CHENNAI, India, 23 April 2019
In recent years, China has been praised for achieving rapid and remarkable economic growth and industrial development. China has been the driver of world economic growth in the last decade or so, and the world applauds China’s cuzontribution to the global economy.
China has achieved such progress by skillfully adopting a liberal policy of encouraging and inviting multi-national companies at the forefront of technological developments to invest in China and enter into technical and financial collaboration with Chinese companies. Given the fact that China’s market potential is very large, and faced with the problem of a nearly-saturated market for several products in the US and West European countries, multinational companies felt enthused by the proactive policies of the Government of China, and came forward to invest in a massive way and liberally share their technology expertise in China.
China has facilitated smooth investment by multinational companies by implementing proactive policies and setting up several industrial parks with integrated infrastructure facilities and also ensuring peaceful industrial climate, without labour unrest and bureaucratic hurdles.
It has been a win-win situation for both China and multinational companies based in the US, Western Europe, and Japan, as the interests of all of them have been elegantly met.
Gains for China
When multinational companies invested in China in a big way and introduced their updated technology practices, Chinese technicians and engineers and scientists inevitably got exposure to modern technologies and have updated themselves. In the process, the technology base of China has got considerably strengthened, prompting growth of R&D and product development efforts by the Chinese companies.
Certainly, China could not have achieved such rapid economic and industrial growth without massive investments by multinational companies and introduction of sophisticated technology practices by multinational companies in the industrial, management, and services sectors.
When multinational companies invest their money and technology in countries like China, India, and the Middle East to boost their own business prospects, it inevitably results in transferring technology of high standards to the recipient countries.
Now China is in a position where it can further build its technology base by its own efforts, without needing support from multinational companies on the same scale.
Concerns about China’s long-term intentions
While the world is impressed by the enormous economic and industrial growth achieved by China, suspicions are also getting strengthened as to what could be the ultimate objective and aim of the Chinese government apart from industrial and economic growth.
Many actions of the Chinese government in the political sphere and in their handling human rights issues in the past few decades have caused misgivings about China’s long-term intentions. Many tend to think that China’s intentions and goals are not much different from that of Hitler’s Germany, when Hitler wanted to dominate the world and emerge as undisputed world leader and control the entire world under his thumb.
China invaded Tibet and brutally suppressed the protest movement in Tibet, which resulted in the respected Dalai Lama having to leave Tibet and enter India as a refugee along with his devotees and supporters. Many more Tibetans who stayed back in Tibet and who did not accept China’s invasion were massacred.
China is now claiming Arunachal Pradesh, which is an integral part of India, as its own territory.
China is violently suppressing the Uyghur in China who are asking for religious freedom. There are many different groups of Muslims in China. But in Xinjiang (East Turkistan), which is predominantly Uyghur, the Chinese government has created a surveillance system and internment camps holding over a million people, and many persons have even disappeared completely.
China has warned the world against raising any questions regarding their policies in tackling the unrest amongst the Uyghur. China is trying to repeat its “Tibet success” with the Uyghurs.
With its money and trade power, China has ensured that no Muslim country will protest against China’s suppression of Uyghur. Even Turkey is not saying much, though the Uyghur consider themselves ethnically belonging to Turkey.
The world is developing a deep suspicion that the Chinese leadership, just like that of Hitler, has no ethical or moral commitment and will go to any extent to achieve its self-centered goals and objectives.
Whither the “Big Leap Forward”?
China built a large capacity in multiple fields in the manufacturing and services sectors in a variety of ways. As a matter of fact, in the case of several products, the manufacturing capacity built by China is several times more than what the world needs today or for the next few years.
China is now facing a piquant situation: It is having problems in marketing its products, leading to lower-capacity utilization and closure of units. China today desperately needs world markets for its survival and for sustaining the growth.
It is estimated that 20% of the China’s investment projects are facing a push-back.
China’s Industrial firms posted their worst slump in profits since late 2011 in the first two months of this year 2019, as increasing strains on the economy in the face of slowing demand at home and abroad took a toll on business.
The sharp decline in profits suggests further trouble for China’s economy, which expanded at its slowest price in almost three decades last year. The Government has already lowered the economic growth target this year to 6 to 6.5% from the actual rate of 6.6% in 2018. Profits made up by China’s industrial firms in January-February 2019, slumped 14.0% year on to 708.01 billion Yuvan (US$105.5 billion), the National Bureau of Statistics (NBS) said on its website. It marked the biggest contraction since Reuters began keeping records in October 2011.
Profits in the auto sector were down 37.1 billion Yuan from a year earlier, while those in the oil-processing industry fell 31.7 billion Yuan.
The drag was mainly due to price contractions in key industrial sectors such as the auto, oil processing, steel, and chemical industries. Production and sales are slowing as well.
OBOR initiative: A desperate move
Finding the situation untenable and dangerous for the future economic and social stability of China, the Chinese government has hit upon the idea of launching the One Belt One Road (OBOR) initiative to connect China with Asia, Europe, and beyond with massive infrastructure spending and investment.
The strategy is to spread the Chinese influence abroad and saddle countries with weak economies with unsustainable debt and with projects executed with China’s loan and technology. China expects that it would find a huge market for its products abroad with the OBOR scheme, and it will also serve its ambition of gradually gaining control not only over the world market but over the world itself.
In the process of launching the OBOR scheme, China hopes to achieve the twin objectives of increasing the dependence of other countries on China and directly or indirectly controlling their economy.
Projects are being built under the OBOR scheme first in the weaker countries that are desperately needing investments .
Pakistan is now one of the major victims of China’s economic aggression, allowing China’s schemes under the economic corridor projects. Pakistan, Kenya, Sri Lanka, and others, and recently even Italy have agreed to sign up the Chinese plan.
Of course, there are signs that many countries are realizing the gravity of the trap being laid by China and are becoming more cautious, so that they would not expose themselves to Chinese dominance and control.
Lessons from Hitler’s Germany
While the Chinese leadership has the same ambitions as those of Hitler’s Germany, China has also learnt from the bitter experience of Hitler and has reworked the strategies.
While Hitler indulged in military warfare to control the world, China has chosen the softer path of economic and trade warfare. It wants to dominate the world by economic and trade power and achieve a “bloodless coup”.
Why a trade war with US?
Realizing China’s long-term intentions and alarmed by its strategies, US President Trump launched a trade war with China. The objective is to weaken China’s economic power and affect its capability to dominate the world economically and by its trade power.
To what extent President Trump will be successful in a trade war with China remains a moot question at this stage, as the interests of the US economy itself are also affected to some extent.
At the crossroads
Having created huge industrial capacities and finding OBOR strategies facing resistance in some quarters and not providing the benefits to the level of expectations, coupled with a trade war with the US and being accused of human rights violations and expansionist ambition, the time has come for China to reassess its plans for the future.
Certainly, given the present predicament, China can not have its way by browbeating the world.
The fact that China is forced to support and defend Pakistan-based terrorism in the UN forum, and has no alternative other than opposing the move of several countries to control and checkmate the dreaded Pakistani-based terrorist, clearly indicates China’s confusion. China is afraid that any support that it would extend to control the terrorist would result in terrorist groups joining together and attacking the interests of China in Pakistan, and even violently acting against thousands of Chinese managers and technicians presently working in Pakistan under the “Economic corridor projects”. Obviously, this shows that China has become vulnerable.
China has to step back
China is realizing that economic and trade power has its limits, just like Hitler realised that military power has its limits.
China’s occupation of Tibet several decades ago continues to haunt China and remains as a talking point in world forums. It shows the true face of Chinese leadership to the world community, and the present conditions in Tibet and in Xinjiang remain as a standing monument to China’s ruthlessness.
Unlike Hitler’s Germany, which was totally defeated in its efforts to dominate the world through military power, China’s softer strategy of using economic and trade power to dominate the world may not result in the type of annihilation that Hitler faced. But, China’s influence in the world will be seriously challenged unless it can give up its ambitions to win the whole world. If China will not alter its aims and goals, it will have to pay a price before long.
Whether this weakening of China, now at the crossroads, will lead to liberation of Tibet from China’s aggression, will be the subject of considerable debate and discussions in the coming days.
About the author
NS Venkataraman is a chemical engineer as well as a social activist in Chennai, India. He is the founder trustee of Nandini Voice for the Deprived, a Chennai-based not-for-profit organisation serving the cause of the deprived and down-trodden, and working for probity in public life.