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China factor and its import in international relations

By Jayatilleke de Silva

China has been the focus of attention of many political analysts and international relations experts. This is quite natural for several reasons.
First, it has seen almost two-digit continuous growth for the last three decades. This is an unparalleled feat. Only India could come close to it.
Second, it has achieved a 60 per cent reduction in those living below the poverty line between 1981 (65 percent) and 2007 (4 percent), thereby lifting 600 million people out of poverty. Besides it has raised the poverty line by 500 percent in a span of 24 years. The poverty line which stood at 200 yuan per capita was raised to 1,196 yuan in 2009.

Third, China is now the second biggest economy after the United States. Goldman Sachs Inc has predicted that it will surpass the United States and become the world’s biggest economy by 2027. According to Nobel Laureate Robert Fogel Chinese economy would amount to 123 trillion US dollars in 2040 and will produce 40 per cent of the Global GDP then in contrast to the United States contribution of 14 per cent.
Fourth, it has been the first major economy to get out of the financial crisis that followed the collapse of the sub prime mortgage market in the United States in 2008. This is in contrast to the fate of the developed western economies including the United States and the UK which are still reeling from the fallout of that crisis.
Fifth, China’s ascent to the top has been marked by a strategy of peace and cooperation instead of war and aggression as was the case with colonial powers.

Sixth, its dual role as a world power, on the one hand, demonstrated by its veto holding position in the UN Security Council and growing influence in the multilateral institutions and as a developing country, on the other hand, struggling for a new world economic and political order, makes it more attractive to a wide range of countries across the globe irrespective of their political and economic differences.
Today the Chinese economy is very much integrated to the world economy and together with it its geopolitical role has also climbed steeply. This has made it imperative for all nations big or small to assess the true import of the China factor in orienting its international relations. No country could ignore it without risk to its own national interest.
This situation has naturally caused a flourish of anti-China propaganda stemming from aggrieved parties, notably the conservative forces in the declining super power, the United States. China is seeking hegemony, domination and is exercising a modern variant of neo-colonialism, they charged. Even the United States Secretary of State Hilary Clinton alluded to new types of neocolonialism threatening the continent without directly mentioning China, during her recent visit to several African countries. The same views are echoed throughout Asia and Latin America too.

The truth is that developing countries or countries of the South find common objectives in their struggle for a New Economic Order and the development of relations with China suits their national goals of economic development and preserving their sovereignty and independence from external threats. China follows a policy of respect for sovereignty of each nation and non-interference in the affairs of other states. The mutual coincidence of interests has made it possible for China to arrive at win-win situations in its dealings with the Third World.
A good example of the benefits of cooperation with China is seen from the experience of the African continent. Africa has a difficult battle to eradicate poverty, unemployment and ensure food security to its people. China, on the other hand, needs raw materials and food to satisfy the ever growing needs of its vast population. While China’s products, technology, financial aid and human resource development assistance meet the needs of African development, African imports, especially crude oil and agricultural products promote economic development in China.

According to the Economist magazine currently China provides more loans to Africa than the World Bank. What more, China provides loans without conditionalities and it does not make human rights or any other internal political issues a problem in providing them. This has made the West to accuse China of supporting authoritarian regimes but the accusation runs shallow considering the West’s track record in supporting dictatorial regimes throughout the world such as those of Mobutu, Pinochet, Duvalier, Somoza and many more. Chinese investment in Africa increased by 30.3 percent during 2005 – 10, according to the Heritage Foundation. A notable landmark in the development of Sino – African relations is the establishment of the Forum on China – Africa Cooperation (FOCAC) established in October 2000 attended by 44 African countries. Its meeting in 2006 was attended by 48 African nations, including 43 Heads of State, demonstrating its rapid growth.
A similar situation is visible in Latin America too. At present China is the region’s second biggest trading partner after the United States. It has also established strategic partnerships with Brazil, Mexico, Argentina, Venezuela and several other Latin American and Caribbean countries. It has initiated a dialogue with regional bodies Mercosur, the Rio Group and the Andean Community. It has joined the Inter-American Development Bank (IDB) as a member.

The Economic Commission for Latin America and the Caribbean (ECLAC) in a report published in May 2010 called upon the countries of the region to ‘promote a strategic alliance’ with China. “Chinese investments in infrastructure projects and energy would not only strengthen economic relations between the region and China, but also generate positive externalities for the regional integration process in Latin America,” it said. ”The relationship between China and Latin America and the Caribbean is ripe for a qualitative leap,” it concluded.
The development of Sino – Latin American relations has, however, caused concern in the United States which had hitherto considered the region as its exclusive backyard and resisted vehemently any incursion there by foreign powers. It had even proclaimed a separate doctrine – the Monroe Doctrine - calling for a hands off policy by other powers. The declining economic might of the United States and its ever increasing dependence on China to bail it out financially has prevented the application of the Monroe Doctrine at present.
Relations with China has helped the region to obtain financial assistance and find markets for their produce to cover the losses resulting from the contraction of the United States and European markets due to the global financial crisis.

A similar trend is visible in Asia too. China has entered into a Free Trade Agreement with the 10-member Association of South East Asian Nations (ASEAN). It is the second biggest trading partner of Japan. Its relations with South Korea has improved tremendously. Pakistan is increasingly reaching out to China in the wake of the deterioration of its relations with the United States and the increasing threat from non-state armed groups.

Nor has the European Union underestimated the import of developing relations with China. The frequent exchange of visits at the highest level between the EU countries and China as well as the swelling trade relations testify to this fact. The all round development of Sino-US relations also shows that in the present world context almost all nations are attracted by China. This could not be the case if developing such relations ran counter to the national interest of these nations. Of course, this does not preclude the development of contradictions among them, for life is replete with contradictions. Such contradictions cannot be swept under the carpet but have to be resolved through dialogue and mutual understanding.