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April - May 2017 www.allchinareview.com
Mutual Gains, The New Normal In International Relations? China Steps Up as U.S. Steps Back from Global Leadership Opportunities and Limits of China’s Role in Afghanistan Food and Identity in Contemporary Perspective
Moving from Washington to Beijing Consensus
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APRIL - MAY 2017
China Steps Up as US Steps Back from Global Leadership p.18
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International Relations Mutual Gains, Not Shared Values: The New Normal In International Relations? Lucio Blanco Pitlo III
Outlook Moving from Washington to Beijing Consensus Ume Farwa
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China Steps Up as US Steps Back from Global Leadership Flynt Leverett and Robert Sprinkle
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The Coming War on China John Pilger
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Opportunities and Limits of China’s Role in Afghanistan Angela Stanzel
Economy 32
Can China’s Belt and Road Initiative Successfully Lead to a New Eurasian Economic Zone? Jeremy Garlick
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The TTP is Dead. What Happens Next? Kavaljit Singh The Rise and Decline of Four Little Dragons Dan Steinbock
Can the “Great Wall” Hold Back a Technological “Tsunami”? Christopher Lim and Tamara Nair
Culture 50
2017: Three Great Expectations Tommy Koh
World Politics
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Technology 45
Authentic, Ethnic, and Fusion: Food and Identity in Contemporary Perspective Ishita Banerjee-Dube
Olympics 54
Beijing 2022 and China’s Second “ComingOut Party” Dan Steinbock
China-US 57
China and Trump: A New Mega-narrative Zha Daojiong
World 59
Trump and the New Iran Gambit Peter Koenig
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Paul Krugman is Right Here – The Danger of Trumps’ Trade Plans is the Reverse China Shock Tim Worstall
Philippines 65
The Philippines “BRIC” Plan: From Regime Change Ploys to Accelerated Economic Development Dan Steinbock
Production & Design: Angela Lamcaster Print Strategy: Stefan Newhart Production Accounts: Lynn Moses Editors: Elenora Elroy, David Lean Managing Editor Europe & Americas: Yetunde Olupitan Group Managing Editor: Jane Liu Editor in Chief: All China Review Publishing Oscar Daniel READERS PLEASE NOTE: The views expressed in articles are the authors' and not necessarily those of All China Review. Authors may have consulting or other business relationships with the companies they discuss. All China Review: 3 - 7 Sunnyhill Road, London SW16 2UG, Tel +44 (0)20 3598 5088, Fax +44 (0)20 7000 1252, info@allchinareview.com, www.allchinareview.com No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording, or any information storage and retrieval system, without written permission. Copyright © 2017 EBR Media Ltd. All rights reserved. ISSN 2044-9305
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Global Outlook
Moving from
Washington to Beijing Consensus BY UME FARWA
In the era of globalisation, Ume Farwa elaborates on the failures of the Washington Consensus and the hopes and promises that the Beijing Consensus brings, not only to China but also to smaller nations around the globe. “After 75 years of US leadership on the world stage, the Mar-a-Lago Summit might mark the beginning of a handover of power from the United States to China.” Fareed Zakaria, Author of the Post American World 1
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ow that the question of the shift of power from the East to the West has settled, the time demands a global outlook markedly in contrast with the previous one. Along with the American Dream, Washington Consensus has also proved to be an illusion. The United States couldn’t live up to its own socio-economic proposals according to the Washington Consensus, both at home and abroad. Since 2003, when the world famous economist, Joshua Cooper Ramo floated the term Beijing Consensus, a Chinese model of development and progress had begun to attract attention across the nations with American global influence shrinking and Populist forces compelling it to back off from its global responsibilities, the Beijing Consensus could never have been more relevant. Here a critical question arises: What can the Beijing Consensus offer to the world,
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April - May 2017
In his Bowling Alone, Robert Putnam pens the details of how American elites have been building an empire at the expense of their nation, all in the name of neo-liberalism.
in terms of ideas, initiatives and institutions, which Washington Consensus failed to deliver? In 1989, John Williamson proposed ten policy proposals, based on the themes frequently used in Washington-based international institutions, to set an economic model for other nations. Centred in financial liberalisation, private entrepreneurship and political opening, these policy proposals were as much social as they were economic. It shifted development thinking to neo-liberalism. During the Cold-War era, its inherent tensions between democracy and capitalism remained bubbling under the surface resurfacing at the time of the Great Recession of 2007. Since then, the world has been losing confidence in it. However, it suffered setbacks from its very outset. It is because it manifested itself as “one-size-fits-all” approach. When Williamson tried to apply it to Latin American, he was surprised to know it was not applicable to even America’s immediate neighbourhood.2 In 30 years of trade with Latin America, the consensus helped grow the region less than one percent in terms of per capita income. It constituted a system of monopoly of global and national elites in which the rest suffered. In his Bowling Alone, Robert Putnam pens the details of how American elites have been building an empire at the expense of their nation, all in the name of neo-liberalism.
Conceptualising mainly on equality and development, it had been benefiting only the few elites of the societies. J.D. Vance penned down the painful detail of alienation and anger of America’s working class and of how Americans stood against their own system. In his book, Hillbilly’s Elegy: A Memoir of Family and Culture in Crisis, he explained that Americans believed that their governments robbed them of their hopes, shattered their dreams and their cities crumbled. This is the utter failure of the Washington Consensus in its very home. The Washington Consensus lost its charm because its spirit was devoid of any consensus. From the very outlook, it appears a diktat carried out through Bretton Woods Institutions. For decades, the Global South has been looking for “opportunityfor-all” but it found itself marginalised in global economy and, at times, burdened by the fiscal policies, with the stringent conditions of reforms from US perspective only. In comparison with the Washington Consensus, the Beijing Consensus is the Chinese model of progress which is a fusion of Chinese thinking and learning on a development model and globalisation. It interpreted growth and development as a function of political control in economic sector, state-ownership of firms and innovation in state sectors. Joshua Cooper Ramo describes it as a composite of three theorems: Repositioning the values of innovation to reduce the friction-losses of reforms; a development model of sustainability and equality; and the theory of selfdetermination.3 China’s innovation with caution was the flip side of “cross the river by groping the stones”. Therefore, it can offer flexible ideas of development of experimenting while gauging a state’s own suitability. From 1980 to 2015, it reduced poverty by 94 percent, which is no mean feat.4 It, thus, sets a successful practical application of bottom-up sustainable development approach. It is the approach that China figured out for its progress and development when the Washington Consensus (Washington-knows-best) was the global norm. Therefore, it is attractive to other nations because they think, just like China, they can write their own story of success and development, keeping their culture and national pride intact, in a world where they might not be a significant power. Lurking behind it is the idea of a free world: freedom from foreign oppression; striving for a path to be independent while staying interdependent with
other states. This idea along with developing countries is the strength of China in furthering the Beijing Consensus. It is time for China to add intellectual charisma and accelerate the momentum of China-led initiatives and institutions based on consensus, suitability, wide-ranging applicability, and economic equality. With the US backing off from TransPacific Partnership, it is time for Regional Comprehensive Economic Partnership (RCEP). Here, China is reluctant to give a regional free trade agreement, which excludes the US. Instead of waiting for the Trump’s protectionist US, China should take lead and further RCEP. It would strengthen Beijing’s influence in the region if it starts negotiations on RCEP on the basis of ASEA Free Trade Area. In Asia only, there is need of $1.4 trillion to invest in infrastructure annually between 2017 and 2030 to sustain its growth momentum, according to the latest Asia Development Bank report.5 One Belt One Road (OBOR) is one such initiative. It used an investment-aid-grant-loan model to back the projects of these initiatives. In Asia, particularly, inadequacies and different socio-political systems are some of the challenges which China needs to steer clear of. For instance, in the China-Pakistan Economic Corridor (CPEC), it has used this model, which is making the country a darling of foreign investors. These investments are the soft and concessional loans, which are given to the companies involved.
The Beijing Consensus is the Chinese model of progress which is a fusion of Chinese thinking and learning on a development model and globalisation.
It is time for China to add intellectual charisma and accelerate the momentum of China-led initiatives and institutions based on consensus, suitability, wide-ranging applicability, and economic equality. Nonetheless, there are certain confusions popping up. The most significant became apparent when the Global Times published an article whether Pakistan would be able to return loans as its fiscal debt increased to around 2.4 percent.6 To dispel
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Global Outlook
In the short run, state-controlled capitalism may work but in the long run, due to its inherent short falls, China needs to bring a paradigm shift in market economics and offer an alternative to free-market capitalism in an all embracing manner.
The 16th Meeting of The Regional Comprehensive Economic Partnership Trade Negotiating Committee and Related Meetings held in Indonesia December 2016. Photo courtesy by www.royalindo.com
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the misperceptions, if any, and allow no room for misunderstandings, Chinese state entities will have to work in collaboration with the host country and its people. Before launching any mega-investment project, it needs to conduct a survey among different strata of its society to analyse how the host country views China’s approach. In a today’s multi-polar word, the likelihood of the South-South Development Cooperation has been expanding. It will resolve the longstanding issue of the North-South gap in terms of economy and industrialisation. Since its initiatives in developing countries are based on the South-South Cooperation Development Cooperation Model, it needs to expand its development finances, not in terms of volume but in its scope as well. Therefore, a Sovereign Wealth Fund should be established. China has created a network of multilateral regional and international institutions. Asian Infrastructure Investment Bank, Shanghai Cooperation Organization and Association of South East Asian Nations +3 are the few of such influential entities. These fora can be used effectively to enhance influence of Beijing in the region. However, it shouldn’t stand aloof from existing
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April - May 2017
internal financial institutions rather it should increase its influence within these institutions. It should develop a culture of consensus rather than dictation, the old practice in these institutions. Gradually, it should increase joint ventures of Bretton Woods Institutions and China-led institutions in order to expand its sphere of influence. Intellectual charisma of the Beijing Consensus is its strength. It is anchored in learning from the West’s failures without leaving its own ground. This adds gravity to the idea of Globalisation. In the short run, state-controlled capitalism may work but in the long run, due to its inherent short falls, China needs to bring a paradigm shift in market economics and offer an alternative to free-market capitalism in an all embracing manner. It is of paramount significance as the nations which lead the world create a “Weltanshauung”, the global outlook, which then becomes a central piece of their global supremacy. The US created the global outlook on the basis of liberalism, which charmed the world. Though this global outlook is fading away, China still needs to work for a global outlook with its own characteristics. The Beijing Consensus is but a part of this outlook. Beijing will have to proportionate its increasing influence with acceptance of its ideas.
Ume Farwa is a Research Fellow at the Institute of Strategic Studies Islamabad (ISSI) and Sub-editor at ISSI Quarterly Journal. Her area of research is the political economy of China and of Pakistan-China relations. References 1. Zakaria, Fraeed. (2017). Trump prepares to pass the leadership baton to China. The Washington Post, March 16. Also available at https://www. washingtonpost.com/opinions/trump-prepares-to-pass-the-worldleadership-baton-to-china/2017/03/16/c64ccee2-0a84-11e7-a15f a58d4a988474_story.html?utm_term=.b8face82e463 2. Ramo, Joshua. (2004). Beijing Consensus. Foreign Policy Centre, London. 3. Ramo, Joshua, “Beijing Consensus”, 2004, Foreign Policy centre, London, page 11-12. 4. Ghazanfar Ali Garewal. (2017). Shanghai: economic conduit for global south. Shanghai Daily, February. http://www.shanghaidaily.com/opinion /foreignperspectives/Shanghai-economic-conduit-for-global-south/shdaily.shtml 5. China Real Time Report. (2017). Building Binge: ADB Calls for More Infrastructure Across Asia. Wall Street Journal, February 8. http://blogs.wsj.com/ chinarealtime/2017/02/28/adb0228/ 6. Song Shengxia. (2017). China should ensure Pakistan doesn’t face financial crisis. The Global Times, February21.http://www.globaltimes.cn/content/1033997.shtml
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Outlook
2017 presidential election will be reserved for Malay candidates: PM Lee
2017: THREE GREAT EXPECTATIONS BY TOMMY KOH
In this article, the author discusses three events that will be important in 2017. These are Donald Trump’s inauguration as the 45th President of the US, Asean’s 50th anniversary and the next Singapore presidential election.
Third, the next Singapore presidential election will be held on or before Aug 26. I wish to discuss each of those three events and explain why they are important and how they will have an impact on our lives.
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The Trump Presidency The US is the only superpower in the world. It has the world’s largest economy, the most powerful military and very attractive soft power. There is no other country like it. At the end of World War II, the US led the victorious allies in designing the
hen I think of 2017, three events dominate my mind. First, on Jan 20, Mr Donald Trump will be inaugurated as the 45th President of the United States of America. Second, on Aug 8, Asean will commemorate its 50th anniversary.
post-war order. The vision was to create a new world order based on the sovereign equality of states, the rule of law and collective security. On the economic side, the vision was to create an economic order based on free trade, stable currencies and cooperation to promote development. It was also part of the vision to promote democracy and human rights. To fulfil that vision, several multilateral institutions were established. They include the United Nations, the International Monetary Fund, the World Bank and the General Agreement on Tariffs and Trade (which has evolved to become the World Trade Organisation). Every US president since Franklin Delano Roosevelt has, to a greater or lesser extent, adhered to that vision and supported those institutions of global governance. The question is whether the 45th President of the United States, Mr Donald Trump, will do the same or depart from precedent and make a paradigm shift. Under his leadership, will the US become isolationist?
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Outlook
Individual Asean governments must have the wisdom to realise that Asean must remain united and neutral if it is to retain the central role it plays in the regional architecture.
ASEAN showcased a new brand logo for its Visit ASEAN@50 Golden Celebration 2017 tourism campaign at the ASEAN Summit held in Vientiane. © TTG Asia
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Will the US continue to champion free trade and globalisation or will it become protectionist and pursue a mercantilist trade policy? Will the US pursue the goal “to make America great again” with or without regard to the interests of others? We do not know the answers to those questions. We can, however, take comfort from some of the individuals whom President-elect Trump has nominated. The Secretary of State and the Defence Secretary are two of the most important posts in the Cabinet. General James “Mad Dog” Mattis, the nominee to be the defence secretary, has a solid reputation in Washington. He earned his nickname in the Marine Corps as a charismatic and toughminded military commander. Mr Rex Tillerson, the nominee for the post of secretary of state, is well known to Singapore’s leaders. ExxonMobil, the company which he leads, is a major investor in Singapore and a good corporate citizen. Mr Tillerson is a free trader and has written in support of the Trans-Pacific Partnership. He has also testified in the US Congress in favour
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April - May 2017
of the US acceding to the UN Convention on the Law of the Sea. He is not an ideologue but a pragmatist. If confirmed, we are confident that he will be a successful secretary of state. Asean Turns 50 On Aug 8, Asean will mark its 50th birthday. It is an event which all of us in Singapore and in Southeast Asia should celebrate. When Asean was born in 1967, many pundits in the West predicted that it would die in its infancy. They pointed out that the region was too diverse and there were few commonalities among the founding five countries. This was a time when some commentators in the West had described South-east Asia as the Balkans of Asia. When the Cold War ended, the detractors of Asean in the West said that Asean was doomed. They described Asean as a creature of the Cold War. The reasoning was that with the end of the Cold War, Asean had lost its reason for being and would therefore fade away. Individual Asean governments must have the wisdom to realise that Asean must remain united and neutral if it is to retain the central role it plays in the regional architecture. Over the past 50 years Asean has overcome many challenges. It has grown from strength to strength. It is today one of the world's most successful regional organisations. I would highlight three of its most important achievements. Asean has transformed South-east Asia from a region of war and conflict to a region of peace and stability. It is not yet possible to say that war between Asean countries is unthinkable. However, when an armed conflict occurred along the Cambodian-Thai border, Asean intervened by trying to calm the situation and urging the two sides to show restraint. Indonesia offered to send observers to the border. The UN Security Council outsourced the management of the crisis to Asean. The second achievement of Asean is economic. The rise of Asean in the world economy is one of
the three biggest growth stories of human history. Asean has become an economic community. The ambition is to create a single market and production base by eliminating tariffs and other trade barriers. With 620 million consumers, Asean has a combined GDP of US$2.3 trillion (S$3.3 trillion), making it the seventh-largest economy in the world. The combined GDP is projected to increase by more than fourfold to US$10 trillion by 2030. This will make Asean the fourth-largest economy in the world. The third achievement of Asean is perhaps the most remarkable. The 10 member states of Asean have been able to unite and act as one. It has established fruitful relations with its 10 dialogue partners, which include all the major powers. It has established several forums to promote dialogue, mutual trust and cooperation, such as the Asean Regional Forum, Asean Plus Three, the East Asia Summit and the Asean Defence Ministers Plus. Asean chairs all these forums. Does Asean have a bright future? I think Asean has a bright future but it faces several important challenges. The first challenge is to ensure that it is securely anchored in the hearts and minds of the 620 million citizens of Asean. Asean must not be seen by the people as a project of the elite and of big business. The second challenge is for the individual governments of the 10 countries to take good care of the people who will be adversely affected by trade liberalisation and economic integration. This must be done in order to avoid a populist backlash of the nature we have seen in Britain and the US. The third challenge is to stay united in the face of intensified competition by the major powers, especially between the US and China. Individual Asean governments must have the wisdom to realise that Asean must remain united and neutral if it is to retain the central role it plays in the regional architecture. Electing Singapore’s Eighth President The Singapore electorate will elect its eighth president on or before Aug 26. The Singapore Government has declared that the next presidential election will be reserved for Malay candidates. Singapore has not had a Malay president since Mr Yusof Ishak in 1970. I had expected my Malay friends to welcome the decision to have a reserved election for our eighth president. Much to my surprise, several of my Malay friends told me that they did not like the idea. They
explained that it would violate the principle of meritocracy. They said they would prefer a Malay president to be elected in an open competition and not in a reserved election. What is my attitude towards the issue? I hold the view that the highest office of our Republic, the presidency, should not be the monopoly or the duopoly of one or two ethnic groups. It should be held by worthy individuals from the different ethnic groups.
The Singapore Government has declared that the next presidential election will be reserved for Malay candidates. Singapore has not had a Malay president since Mr Yusof Ishak in 1970. I like the old system of the Parliament electing the president. Under that system, we had an excellent Malay president, Mr Yusof Ishak, and an excellent Eurasian president, Dr Benjamin Sheares. The Government is not confident that, in an open election, we will ever elect a Malay or a Eurasian to that high office. This is the rationale behind the procedure of reserving an election for a particular ethnic group. Is it a violation of the principle of meritocracy? We have two competing principles at play: the principle of meritocracy and the principle of inclusiveness. In most situations, the principle of meritocracy should prevail over the principle of inclusiveness. However, in this case, I would like the principle of inclusiveness to prevail over the principle of meritocracy. I therefore look forward to voting for an eminently qualified Malay candidate next year to be our eighth president. This article was first published on The Straits Times on 3 January 2017 (http://www.straitstimes.com/opinion/ 2017-three-great-expectations).
Tommy Koh is the Chairman of the governing board of the Centre for International Law at NUS.
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World Politics
China Steps Up as US Steps Back from Global Leadership BY FLYNT LEVERETT & ROBERT SPRINKLE
Global leadership is shifting, not drifting, toward Beijing. As Washington greets a new administration disinclined to play a worldwide role, Beijing increasingly accepts opportunities to lead.
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hinese President Xi Jinping’s appearance at the World Economic Forum earlier this year shows global leadership is shifting, not drifting, toward Beijing. The most vigorous defense of globalization and multilateral cooperation was mounted not by an American statesman, but by the president of the People’s Republic of China. “The problems troubling the world are not caused by globalization,” Xi declared. “Countries should view their own interest in the broader context and refrain from pursuing their own interests at the expense of others.” Speculation is mounting that the United States, with Donald Trump cast in the role of president, will ignore international challenges, renounce global responsibilities and abandon friends and allies. As Washington greets a new administration disinclined to play a worldwide role, Beijing increasingly accepts opportunities to lead. Xi and his colleagues understand that their country’s domestic
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Xi Jinping appeared at the World Economic Forum, a first for a Chinese leader, with a fullthroated defense of globalisation. © Gian Ehrenzeller / European Pressphoto Agency
China is already the world’s leading producer of renewable energy technologies. More remarkably, it is also the leading consumer.
development and global ascendance require steady engagement and honest efforts abroad. Yes, China has “done the right thing” before. It has restricted antibiotics in food-animal agriculture, created a new infrastructure-development bank for Asia, aided previously exploited African countries and promised to end its internal ivory trade. But never before has China so forthrightly stepped up when the United States appears to be stepping away. As scholars of Chinese strategy and the intersection of science and politics, we see how Beijing’s ambitions and interests will affect its engagement on a range of important international issues. The Case of Climate Change Climate change policy is one good example of this trend. Commentators warn that Trump’s pledge to withdraw the US from the Paris climate agreement would let China “off the hook” for curbing carbon emissions. In fact, China put itself “on the hook” in Paris for reasons having little to do with the United States. China’s most urgent atmospheric problem is not carbon dioxide. It’s combustion toxicity from burning coal, oil and biomass. The Chinese these days don’t look through their air; they look at it. And what they see, they breathe.
Combustion toxicity has degraded China’s air quality so much, by Chinese assessments, as to destroy 10 percent of GDP annually since the late 1980s and cause hundreds of thousands of premature deaths every year. And air pollution has become China’s single greatest cause of social unrest. In response, China is closing its old coal-fired power plants, and the new ones it’s building are much farther away from its prosperous and politically influential eastern cities. Other fossil-fueled industries are being put farther away, too. China has also contracted with Russia to buy huge amounts of natural gas, whose combustion emits lots of CO2 but not a lot of toxic air pollutants. These moves will expose fewer people, especially prosperous urban dwellers, to toxic air pollution. On their own, though, these moves will not do much to meet carbon targets and restrain warming. In an even better bet to clear its air, China is moving to add more nuclear, hydroelectric, solar and wind turbine generating capacity. Greenpeace estimates that during every hour of every day in 2015, China on average installed more than one new wind turbine, and enough solar panels to cover a soccer field. China is already the world’s leading producer of renewable energy technologies. More remarkably, it is also the leading consumer. And in January, it announced plans to invest an additional US$360 billion in renewable power between now and 2020. That’s $120 billion a year. These renewable power measures are being taken to fight China’s number one problem – air pollution – but they will also automatically cut China’s carbon emissions. If it can manage political rivalries among local power companies and upgrade its electrical grid to handle all that solar and wind capacity, then China is likely to meet its Paris commitments earlier than currently required. Defecting from Paris would not help China address its air pollution problem. Defection would, however, reinforce the
presumption that US leadership is indispensable – a presumption Beijing is loath to perpetuate. A savvier and more probable move is for China to assert – for the first time on a major global issue – moral authority. Chinese diplomats are already reassuring the world that China will keep and even expand its climate commitments. This message conveys Beijing’s resolve not to let multilateral greenhouse gas mitigation collapse, and show the way out of a crisis whose agreed solution is threatened by others’ malfeasance. National Interest in Global Leadership If sustained, such action will mark a critical inflection point in China’s global role. It will become less a challenger to an established order, and more a champion of a common cause. The United States will risk being regarded as aloof and unreliable and, following its 2016 election, even politically unstable. Likewise, Beijing is asserting greater leadership in other areas once led by Washington. With the demise of the Trans-Pacific Partnership, which Washington negotiated with 11 Asian countries excluding China, Beijing is promoting its own Pacific trade-and-investment framework excluding the United States. Even more grandly, Xi is articulating an alternative vision for global economic growth. The model focuses on physical investment, especially in transportation and IT infrastructure. In this, it is linked to the new Silk Road project, through which China is expanding linkages across Eurasia by integrating railways, ports and information networks into transnational corridors. The Chinese approach also does not rely on portfolio investment and central banks exertions to drive growth – a sharp contrast to Western policies. Ceding global moral authority to China would be a high price for America to pay for the pleasures of political posturing. Yet a China leading by example would have a greater stake in its own reputation, and the greater that stake becomes the more engaged China becomes. Such a China, we believe, could profoundly benefit the world. This article was first published on The Conversation on 24 January 2017. (http://theconversation.com/china-steps-up-as-us-steps-back-from-globalleadership-70962).
Solar panels in Jiangsu Province, China. © Reuters
Flynt L. Leverett (left) is Professor of International Affairs and Asian Studies at Pennsylvania State University. Robert Sprinkle (right) is Associate Professor of Public Policy at University of Maryland.
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World Politics
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Opportunities and Limits of China’s Role in Afghanistan BY ANGELA STANZEL
China’s increasing engagement in Afghanistan reflects its interests in a stable immediate and wider neighbourhood, in particular since Beijing announced to revive the old Silk Routes. While tackling security remains a long-term goal there is scope for the Chinese government in the short and medium term to increase capacity and improve the situation in Afghanistan.
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hina’s role in Afghanistan is gradually evolving towards more engagement in various areas, which reflects the Chinese government’s concerns about deterioration of security and the impact this could have on the region as a whole. In particular since China announced to revive the old Silk Routes, its “One Belt One Road” (OBOR) initiative, it has even more an interest in a fairly
stable immediate and wider neighbourhood. The Silk Road initiative has already given a new impetus to China’s infrastructure development in Pakistan, which had been promised Chinese investment of $45 billion in to construct a China-Pakistan Economic Corridor.1 This project, linking the deepwater port of Gwadar with the Chinese Western province Xinjiang, also includes cooperation to strengthen security – the greatest obstacle in Pakistan. There is some hope in Afghanistan to benefit too from China’s investment and its aim to transform the region into a major trading hub. OBOR is almost cut out for Afghanistan’s need of infrastructure on the one hand and potential vast natural resources on the other hand. The country, at the crossroads of Central and South Asia, between India
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World Politics
Recently, China has signalled its willingness to cooperate multilaterally on security issues concerning Afghanistan – it has now an anti-terrorism alliance with Afghanistan, Pakistan, and Tajikistan, to tackle the threat of terrorism and extremism.
China's People's Liberation Army troops and Pakistani troops attend flag hoisting ceremony Photo: Reuters
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in the South and Russia in the North, would have he potential to become a part of China’s trade and investment network. Beijing already sent a signal towards more cooperation: During Abdullah’s visit to China both countries signed a memorandum of understanding on the OBOR initiative. Since this summer, China started operating the first cargo trains to Afghanistan (Hairatan and Mazar-e-Sharif) in frame of its OBOR network.2 However, the precarious and uncertain security situation is one of the main obstacles for China to implement major projects on the ground. China has failed once before in its attempt to invest into a large-scale project in Afghanistan: A planned $3 billion lease of the Aynak copper mine in 2008, by a consortium of Chinese state-owned companies, never launched mainly due to security issues. Ever since, China has remained reluctant to make large
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April - May 2017
investments in Afghanistan. Afghanistan is increasingly presenting a security concern to China, in particular since the large numbers of NATO forces had left the country by the end of 2014. Although this year the Taliban did not control as many districts as in 2015, they continued to carry out large-scale attacks throughout the country: In June, security guards at the Canadian embassy in Kabul were attacked; in July, Taliban militants drove a truckload of explosives into a foreign military facility; in August, militants stormed the campus of the American University of Afghanistan in Kabul; in September, the Taliban launched two major attacks in the capital within a couple of hours; in November, the Taliban stormed the German consulate in Mazar-e-Sharif. The Chinese government is concerned about the strengthening of the Taliban and other Islamist militant groups in Afghanistan due to possible links between these groups and the restless Muslim population in the neighbouring Xinjiang Province. In addition, Afghanistan’s instability might impact the stability of those countries that are key to China’s OBOR: Central Asia and Pakistan. The Chinese government traditionally refers to its principle of non-interference when it is reluctant to engage in security issues that carry too great risks to go wrong. Nevertheless, China gradually increased its security engagement globally, notably in Africa, although it is still limited to multilateral efforts, mainly UN peacekeeping missions, such as in Mali and South Sudan. Similarly, Beijing has viewed any active role of engagement in matters of security in Afghanistan as risk to becoming a target of terrorist groups such as the Taliban. But recently, China has signalled its willingness to cooperate multilaterally on security issues concerning Afghanistan – it has now an anti-terrorism alliance with Afghanistan, Pakistan, and Tajikistan, to tackle the threat of terrorism and extremism.3 The four countries agreed on establishing a “four-country mechanism” to share intelligence and training. In addition, Beijing is strengthening its bilateral security ties with the Afghan government. In February, the chief of the Chinese army, Fang Fenghui, announced roughly $70 million of military aid to support the Afghan government’s anti-terrorism efforts.4 Beginning of July, the Afghan forces received the first batch of
Chinese military equipment, and in August, both countries held their first strategic military dialogue.5 Allegedly Chinese security forces are also patrolling on the Afghan side near the border to China, although such reports have not been confirmed by the Afghan or Chinese government.6 Such efforts reflect Beijing’s growing worries about an eruption of insecurity that could endanger its security of its border province Xinjiang and its investments in the Central Asian region. However, China’s security role is unlikely to become crucial in order to turn around the situation on the ground in Afghanistan. Beijing has also made less typical diplomatic efforts to promote the Afghan peace process in frame of the Quadrilateral Coordination Group (QCG). China along with Afghanistan, the US, and Pakistan has been holding talks in Islamabad since early 2016 to engage the Taliban in a reconciliation process.7 But the QCG has not achieved any progress as the Taliban are refusing to negotiate so far. Nevertheless it is important to keep the effort alive, not least because it reduces mistrust between Afghanistan and Pakistan. And China’s role as a mediator and confidence-builder may be crucial, as it appears that only Beijing’s constant pressure has kept its long-time ally Pakistan relatively peacefully engaged. Beijing’s interest in benefiting from a reconstructed Afghanistan is also reflected in its evolving role in the area of economic and humanitarian development assistance – and it does have the means to increase its contribution. China is already evolving into a notable though not yet major player in Afghanistan in the area of economic and humanitarian assistance. China’s contribution is still small compared to that of the US or Europe and far from that the largest from donor of Afghanistan in the region – India, which has provided roughly $2 billion to date. But China has gradually increased its contributions to Afghanistan’s development in the last two to three years: it provided roughly $240 million in development assistance and aid between 2001 and 2013, and around $80 million in 2014 alone.8 During the visit of Abdullah Abdullah (the government’s chief executive) to China in May, both countries signed an agreement on technical cooperation (worth around $76 million) and on non-emergency humanitarian
aid. China further pledged $8 million of emergency relief to Afghanistan in July.9 In addition, China is beginning to develop training and education programmes as well as to provide housing projects in urban centres. The Chinese government announced in 2015 to provide 500 scholarships for Afghan students to study in China, and training for 3,000 Afghan professionals in fields including anti-drug trafficking, agriculture, counterterrorism, and diplomacy.10 Following a cooperation agreement last November, China announced to build 10,000 residential flats in Afghanistan, worth roughly $80 million.11 Housing has become an issue in Afghanistan since large numbers of internally displaced people moved in recent years primarily from rural areas to urban centres to escape fighting and seek a better livelihood.12 The urban population is growing on average 6 percent per year (one of the highest rates in Asia), which has put more pressure on cities such as Kabul, Herat, Mazar-e-Sharif, and Kandahar to provide resources and infrastructure.13 Because of its principles, China’s peace-building efforts could not include engaging in state building efforts, such as it is often the Western countries’ approach, but Beijing could increase its efforts in some areas that would support capacity-building of the Afghan government. The government, which is too preoccupied by the country’s worsening security situation to focus on solving its other problems, needs support in a range of areas, such as building capacities to fight corruption, drug trafficking, as well as to improve the weak institutional capacity. Afghanistan also still lags far behind many other low-income countries in social and physical infrastructure. Although China has increased its involvement in recent years, this still does not reflect the degree of its interest in Afghanistan and there is much potential to widen its scope of assistance. Joint training, professionalisation programs for Afghans, or infrastructure projects, for instance, could be areas for Western countries, the US and Europeans in particular, to further engage China. The US and China have already been engaged in moderate training for Afghan security forces and Afghan diplomats for several years, and agreed upon new joint training programs for Afghan medical and
Because of its principles, China’s peace-building efforts could not include engaging in state building efforts, such as it is often the Western countries’ approach, but Beijing could increase its efforts in some areas that would support capacity-building of the Afghan government. www.allchinareview.com
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World Politics
veterinary professionals last year. Germany and China as well have taken first steps exploring this option: Both countries announced recently cooperation in third countries, notably in Afghanistan and agreed to establish a disaster management office and to cooperate on training Afghan personal in the mining sector.14 Any support by China to build the country’s infrastructure, to train Afghan professionals, or to keep an eye on stability and security, would help for what the international community as a whole has been trying to achieve ever since the Bonn Conference on Afghanistan in 2001. In sum, while tackling security remains a long-term goal, there are a number of steps the Chinese government could take in the short and medium term, possibly in cooperation with other countries, to increase capacity and improve the situation in Afghanistan. China might be willing to invest more in Afghanistan if prospects in the country to enhance infrastructure network (roads, railways, etc.) are good enough. It could invest in Afghanistan’s infrastructure, for example via its Silk Road Fund or via the newly-established Asian Infrastructure Investment Bank. In view to the insecurity and uncertainty however it appears unlikely for Afghanistan to become a key country in China’s OBOR plans in the near future, although Afghanistan could certainly benefit from the region’s improved infrastructure for trade and access to markets. In the short and medium term, Afghanistan might actually benefit more from China’s current approach to focus on smaller-scale projects rather than focusing on large-scale projects, as it became common for Chinese infrastructure investments. China could provide more funding to specific projects in Afghanistan, such as in the areas of health, education, and rural or urban development. For other actors in Afghanistan, in particular the US and Europeans, it is necessary to understand Beijing’s limits and choices in Afghanistan in order to further engage China and to pursue more cooperation.
Angela Stanzel joined the European Council on Foreign Relations (ECFR) as a Policy Fellow for the Asia and China Programme in 2014. Before joining ECFR, Angela worked for the Körber Foundation in Berlin, for the German Marshall Fund of the United States in Brussels (Asia Programme) and the German Embassy in Beijing (cultural section). Alongside China’s history, politics and economics, her research work focuses on East and South Asia’s foreign and security policy. References 1. “China’s Xi Jinping agrees $46 bn superhighway to Pakistan”, BBC, 25 April 2015, http://www.bbc.com/news/world-asia-32377088. 2. Eltaf Najafizada, “China lays new brick in Silk Road with first Afghan rail freight”, Bloomberg, 11 September 2016, http://www.bloomberg.com/news/ articles/2016-09-11/china-lays-new-brick-in-silk-road-with-first-afghan-rail-freight. 3. “China joins Afghanistan, Pakistan, Tajikistan in security alliance”, Reuters, 4 August 2016, http://www.reuters.com/article/us-china-security-idUSKCN10F1A6 4. Divya Kishore, “China delivers its first shipment of military aid to Afghanistan”, International Business Times, 4 July 2016, http://www.ibtimes. co.uk/china-delivers-first-lot-military-aid-afghanistan-1568784. 5. “Inaugural Strategic Dialogue by China – Afghanistan militaries held in Beijing”, China Military News, 8 August 2016, http://english.chinamil.com. cn/news-channels/china-military-news/2016-08/08/content_7195557.htm. 6. “Chinese forces patrol deep inside Afghanistan: Report”, Afghanistan Times, 5 November 2016, http://afghanistantimes.af/chinese-forces-patroldeep-inside-afghanistan-report/. 7. Thomas Ruttig, “In Search of a Peace Process “ A ‘new’ HPC and an ultimatum for the Taleban”, AAN, 26 February 2016, https://www.afghanistan-analysts.org/ in-search-of-a-peace-process-a-new-hpc-and-an-ultimatum-for-the-taleban/ 8. Zhao Huasheng, “What is behind China’s growing attention to Afghanistan”, Carnegie, 8 August 2016, http://carnegie-mec.org/2015/03/08/ what-is-behind-china-s-growing-attention-to-afghanistan. 9. “China aids Afghan villages”, 26 July 2016, http://reliefweb.int/report/ afghanistan/chinas-aid-afghan-villages. 10. Zhao Huasheng, “What is behind China’s growing attention to Afghanistan”, Carnegie, 8 March 2015, available at http://carnegie-mec. org/2015/03/08/what-is-behind-china-s-growing-attention-to-afghanistan. 11. Akhtar M. Nikzad, “China to build 10,000 residential apartments in Afghanistan”, February 23, 2016, http://afghanistantimes.af/ china-to-build-10000-residential-apartments-in-afghanistan/. 12. Anne-Kathrin Glatz, “Afghanistan: New and long-term IDPs risk becoming neglected as conflict intensifies”, IDMC, March 2015, available at http://www.internal-displacement.org/south-and-south-east-asia/ afghanistan/2015/afghanistan-new-and-long-term-idps-risk-becoming-neglected-as-conflict-intensifies. 13. Budapest Process, “Afghanistan Migration Country Report”, International Centre for Migration Policy Development, 2013, https://www.budapestprocess.org/projects/silk-routes-project. 14. Press conference, Merkel and Li Keqiang, 13 June 2016, h t t p s : / / w w w. b u n d e s k a n z l e r i n . d e / C o n t e n t / D E / M i t s c h r i f t / Pressekonferenzen/2016/06/2016-06-13-merkel-mp-li.html;jsessionid=02E4169911C4DC6DDDF18A209C7C517A.s3t1.
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