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China an economic threat?

andybob

Well-known member
From The Times (UK), 2 November


Beijing hosts its biggest diplomatic party as it joins scramble for Africa


By Jane Macertney


China aims to make new friends and show the West that it is a force to be reckoned with


Chinese tour guides are brushing up their Swahili, most cars have been ordered off Beijing streets and officials have been told to cycle to work. Hotel chefs have created African menus, the flags of African nations fly over Tiananmen Square and the airport highway has been closed to everyone but African leaders arriving for the largest diplomatic gathering the Chinese capital has seen. The Beijing summit runs over the weekend with as many as 48 of the heads of Africa’s 53 countries in attendance. It will be a landmark in the foreign policy of the country most likely to become a new superpower. It is not insignificant that China - which calls itself the world’s biggest developing nation - is eager to give prominence to its relations with the largest bloc of developing countries. The summit is not only an opportunity for China to nurture its ties with countries that are becoming among its most important sources of raw materials to feed its industrial boom. It is also a chance to underline the view of itself as the closest and most reliable friend to the Third World and to show the West that its diplomacy makes it a force to be reckoned with.


This is no longer the Cold War age, when Beijing sought "anti-imperialist" friendships in Africa to counter the United States and its allies. This time cold, hard business will be at the root of whatever statements on strategic partnership and mutual trust emerge on Sunday. Trade deals are the main incentive behind the slogan "Friendship, Peace, Co-operation and Development" that has appeared on billboards across Beijing. Reductions in tariffs, more aid and training programmes and possibly debt forgiveness will also be on the agenda. China’s trade with Africa ballooned to $40 billion (£21 billion) last year from $5 billion a decade earlier. Trade soared 30 per cent and is expected to grow by at least 25 per cent this year to more than $50 billion. Angola has overtaken Saudi Arabia as China’s largest supplier of oil and African oil now accounts for one third of total imports. Africa’s natural resources are attracting Chinese investment across the continent: phosphates from Morocco, copper and cobalt from the Democratic Republic of Congo and Zambia, iron ore and platinum from South Africa, timber from Cameroon and Gabon and cotton for China’s textile plants.


China is interested not only in minerals; it also wants more diplomatic partners - specifically the five African countries that recognise Taiwan as the government of China. Beijing has invited representatives of Gambia, Malawi, Burkina Faso, Swaziland and São Tomé to attend the summit as observers, clearly with the aim of persuading them that they have more to gain by switching recognition to Beijing and away from an island that China regards as a renegade province. While officials do not yet know how many, if any, of the five will send representatives, any who do attend are certain to be offered financial incentives to switch sides. Taiwan gives medical aid and infrastructure assistance to diplomatic partners but does not reveal the amounts. Oil-rich Chad was the latest country to switch, recognising Beijing in August and becoming the sixth country to change allegiance since 2000. China has rolled out a red carpet for the visitors and more than a million police and volunteers will maintain security. Posters of elephants, giraffes and zebras with the slogan "Africa - the land of Myth and Miracle" line city streets; conference centres have been carpeted with grass. Hoardings show a black hand and a yellow hand clasped or touching fingers. However, one false note was struck on a billboard displaying huge photographs of tribesmen with painted faces and a curved bone piercing their noses - only these were from Papua New Guinea.


It is unlikely to harm China’s prospects in Africa, even though there have been murmurings in some countries that the Chinese buy their resources and sell light industrial goods without regard for African economies. Paul Wolfowitz, the President of the World Bank, accused China recently of disregarding social and environmental standards when lending to developing nations in Africa. China has defended its scramble for Africa. Wei Jianguo, the Vice-Minister for Commerce, said that its soft loans and investments were "like sending firewood in the snow". Chinese products were better suited to African consumer needs, he said. "Chinese investments have greatly benefited the local people and have been popular among them." Zimbabwe has been a big beneficiary, with Beijing funding a new university department that will offer Chinese language and culture courses. In June Harare announced a $1.3 billion deal with China to set up coalmines and three thermal power stations. As President Mugabe said shortly before leaving for the summit: "We have nothing to lose but our imperialist chains." Critics say China’s dealing with countries with poor human rights records, such as Sudan, and its principle of non-interference in other countries’ internal affairs could jeopardise the long-term benefits of its investments. And it is far from certain that when China builds a railway or a stadium it will also transfer technology to African countries. China rejects the criticisms, emphasising that its help comes with no strings attached - unlike Western countries or the World Bank and International Monetary Fund. Wen Heping, an Africa expert at the Chinese Academy of Social Sciences, said: "China wants them to boast of sustainable development. Western countries are interested only in resources. To give them aid is not to put cash in the pockets of a few presidents."
 

Econ101

Well-known member
George Bush didn't lose the subsidized currency argument with China because they were a little bitty power or because he was wrong.

You bet China can stare down GW and win.
 

Steve

Well-known member
It was only a few years ago that Japan's strength was thought to pose a clear and present danger;


Let's be clear: Japan's economy is a mess. The 1990s have been a lost decade, with growth since 1992 averaging around 1% a year. A recession, and perhaps a serious one, is now under way. Unemployment is at record highs. A black hole of bad debt has sucked the life out of the banking system. And those are just the short-term problems.

The deeper structural flaws of the Japanese system are even more daunting. Japan's whole system for allocating capital is broken. The rate of return on capital has now fallen below that in Europe and is less than half the U.S. rate.

what changed that threat?

and is China any differant.......
 

kolanuraven

Well-known member
Let China start holding off a few dozen shipments to WalMart, Target, AutoZone, etc and then see how fast this economy starts to take slide!!!!!
 

Econ101

Well-known member
China is engaging in currency manipulation which hurts domestic businesses and GW could not do anything about it because of China's hold on our economy through U.S. debt and comercial ties as you point out, Kol.

Bush failed on calling China on it because of this.
 

andybob

Well-known member
Unlike Japan, China is actively taking over mining operations, and re-opening factories closed by depotic dictators except the staffing is Chinese therefore not creating local jobs, the Chinese are the fastest growing population, already in greater numbers in many countries than the colonial decendants had ever been. My contacts in Zimbabwe tell of the dislike of the Chinese by the local people as their attitude of distain toward the native people is causing increasing racialfriction.
China has also chosen to activly assist these corrupt regimes remain in power supplying military and riot hardware against specific U.N. sanctions.
 

Steve

Well-known member
Let China start holding off a few dozen shipments to WalMart, Target, AutoZone, etc

Last year I would have agreed with you, but......I have almost bought nothing in Walmart in about a year.......I've been there, and walked away with little....the quality is dropping.....and the prices are not......

I have bought a few things in Target, but not much......

as for Autozone.....I recently bought two reman driveshafts, both went back....talk about crap.....to think someone shipped an old drive shaft to China to be repainted.....reboxed and sold again.....even the guy at the counter was shocked......Chinas' products shiney wrapping is starting to fade....

they like Japan made American companies open thier eyes to prices.....but when push comes to shove, American Companies will shop where-ever the best economic buy is.....

as for Africa, the countries China is aligning themselves with....will suck the money out like vacuumss...and Chinas' communist goverment model will not know when to cut losses.......

I for one am glad they are investing in Africa......the more they invest, the less America has to give, in foriegn aid...
 

Cal

Well-known member
Steve is right. What could pull them down faster than aligning themselves with African nations?
 
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