China’s Growing Economic Interests in Africa: A Pragmatic Basis for International Policies to Restrain Repression and Genocide?

Yehuda Bauer
Professor of Holocaust Studies, Hebrew University
Academic Adviser, Yad Vashem
Bauer1926@yahoo.com

I do not claim to be an expert on China, or even especially knowledgeable, though I did study Chinese history. But I think it is essential that we try to understand Chinese policies, and make an attempt at analyzing them and their impact. It is clearly China that prevents any meaningful non-military international preventive policies in regard to the situations in Sudan, Burma, or Iran. Other possible foci of concern - see Barbara's risk assessments (Harff 2009, pp. 75-78) - may also be or may become centers of Chinese economic and political activity.

The background for this paper is my conviction that what we are witnessing is a slow decline in US influence. The US is no longer the only superpower. The current economic depression hit the West. China is one of the countries which suffered rather mildly. But it is not only the US and China, but also a number of countries and groups of countries that have become meaningful players on the global scene: India, Germany, South Africa, Iran, Turkey, the Arab League/Organization of Islamic States, and so on. Our emphasis on looking to the White House as the arbiter of world affairs is mistaken, although the US certainly is the primus inter pares, the first among equals, and therefore crucially important. The basic difference between open or relatively open societies such as the "Western" countries (US, Canada, most but not all of Latin America, the EU, some African countries, Japan, Thailand (more or less), Indonesia (more or less), Australia and New Zealand) on the one hand, and closed or relatively closed countries, such as China, Russia, Iran, Saudi Arabia, etc., is basic: in the first group of countries one has access to the public, in the other one does not. All our talk about NGOs, public opinion, and so on is vitiated by the fact that for at least half of humanity this is a world that has no relevance for them

My sources are of course purely secondary, and not systematic. This paper is designed to encourage all of us to delve more deeply into this complicated matter. Take Chinese activity in Africa. Trade with Africa (that includes all African countries) was (US) $3 billion in 1995, $55b in 2006, and $107b in 2008, the balance being in Africa's favor. What does that mean? It means that China was importing oil and raw materials, and exporting a combination of means of production, infrastructure, and (cheap) consumer goods. In fact, in 2009, oil, gas, and minerals accounted for 86% of all African exports to China. By partial comparison, oil accounted for 88% of all US imports from Africa in 2008. But I am not sure that these figures for China and the US are at all comparable, because US investments are concentrated in countries like Nigeria and South Africa (French in Chad and Cameroon), whereas the Chinese import their stuff largely from more problematic countries - Sudan, Angola, Congo Brazzaville, Equatorial Guinea, and now also Ethiopia and others. Chinese foreign trade altogether was $2.56 trillion, so that China's African trade was about 4% of the whole. However, in 2008, US trade with Africa came to $140 b, and China was already second.

A crucial question concerns Chinese dependence on foreign oil. In 2008, 50% of the oil that China consumed came from abroad. That oil supplied 12% of all the energy China consumed, because it still depends on coal, nuclear power, and hydro-electricity. One third of the 12%, or 4%, came from Africa. Again, by comparison, the US imported 5.2% of all its energy needs from Africa. But some 79% of African oil for China is used for industrial purposes, whereas in the US a similar 70% are used for motor vehicles. To put all this in perspective, China receives 8.7% of African oil exports, whereas the US and the EU receive some 33% each. The Chinese apologetic argument is, therefore, that China does not dominate African oil markets; the answer is that Chinese oil imports grow by leaps and bounds, whereas Western imports are more or less static. China imports its African oil from the more problematic countries, its imports are exploitative, and income does not filter down to ordinary people, and this is so even when one takes into account Western exploitative investments, such as in Nigeria. Are the Chinese also penetrating Nigeria? I don't know, but I am trying to find out.

A major issue is the Chinese investments in African infrastructures. The West has not helped Africa, to put it mildly, and that is true both of state-sponsored and of private investments. China, on the other hand, has pledged $25 b. for infrastructure for the next three years, but I could not find figures as to the fulfillment of the pledge - one assumes that it was more or less accomplished. This probably contrasts with the non-fulfillment of Western pledges of $25b in 2005 - by 2009, only $2.3b were delivered.

The way China invests in infrastructure contradicts all accepted norms. Take Angola. By 2007, China had loaned Angola over $6b, with an interest rate that went down from 1.5% to 0.25%. The loans were made to a notoriously corrupt government, and no provision was made for reports as to how the funds were to be spent. 70% of the projects were open to bids from anywhere (30% from Angolan investors), and most of these went to Chinese companies (all of whom are controlled, directly or indirectly, by the government/party). Repayment of the loan was in oil, of course. The US Treasury termed China a rogue creditor. But one can understand the Angolans: they are indebted to the West to the tune of about $300b, and are paying relatively high interest, whereas China regularly cancels the repayments of its loans. The problem is that the people who benefit are a) the corrupt, and often dictatorial and murderous, governments, and b) their individual corrupt officials. Sometimes, Chinese investments are totally interest-free - as for instance in a highway between two Ghanaian cities (Accra and Kumasi). And it does not seem that Western loans and investments are less prone to misuse by corrupt governments and officials.

The point in all this is not the static situation, but the dynamics. The slow decline of global American -and generally, Western - economic and political supremacy may take decades to work itself out, but who knows, it may take much less time. China is penetrating markets, and especially energy sources, at a growing speed. This is true not only for Africa, but also for Burma, South-East Asia, and Taiwan (!!). It is also true for tiny Israel, for instance: $4.5 b was invested by China in Israel in 2007 alone, buying up controlling interests in start-up high-tech companies, and in engineering ventures (part of the trans-Israel highway). Why? I would guess that it was Israeli technical know-how that was sought.

It is true that China is not the only Power that supports authoritarian, dictatorial, corrupt and reactionary governments. It is not China that has a special relationship with Saudi Arabia, Egypt, Nigeria, and so on. But there is a basic difference: in the case of Western exploitation, there are real or potential correctives in the form of democratic institutions in Western countries, and a (mostly) free press that can mobilize - again, potentially - public opinion, and oppose policies. There is no such possibility in China. Chinese policies are driven by a tremendous rate of growth (between 7% and 11%, depending on whose statistics you rely) and a resulting need for energy resources to develop - at break-neck speed - industries to satisfy a growing demand. There is also the ‘danger' that millions of Chinese workers may demand higher wages and salaries, and they have to be held under control on the one hand, but given more leash on the other hand.

I have tried to find out something about the internal workings of the Chinese system. Clearly, this is state-capitalism controlled by a dictatorship. In fact, re-reading Lenin's analysis of imperialism, I am convinced that this is an almost classic case of predatory imperialism, on a par with the Western model. There is no need to occupy foreign lands physically, in fact this would be counter-productive. Local corruption matters little. Oil, gas, and minerals matter more. Low interest rates and lost loans are small change for full support by the exploited countries of Chinese policies globally. Penetration into different countries and continents (I have not discussed here very major Chinese investments in Latin America, for instance) are of primary importance in order to make China the second most important, and in the future the first most important, player on the international field. Western press, such as the NYT and its major analysts, understand this very well. And yet, there is a major misunderstanding, I believe: in the West, at least lip-service is paid to moral norms in internal and international politics. As far as the Chinese are concerned, moral considerations are simply absent. There is absolutely no point in approaching Chinese diplomacy with arguments based on morality, they are impervious to them. What matters are economic and political interests. This does not mean that the Chinese are somehow "bad" people. It means that their economic needs are so overwhelming and urgent, that no other considerations matter. At previous points in global history, other regimes, and especially Western ones, did not act differently.

What I do not find in any of the reporting and the analyses is what seems to me, as an historian (who, a couple of million years ago, took a second major in Far Eastern history) to be pretty obvious: China, model 2010, is not unlike China, model 1410 or 1710. The present Emperors are not (so far at least) related to each other, but are elected by the Party leadership for a period of several years; the present Emperor is Hu Jin-tao, and the next one will bear another name, but he (most likely not she) will be a copy of the 16th century Ming or the 18th century Manchu Qing Emperors. Forget about Communism - the adoration of St. Marx is still there, but these are purely liturgical ceremonial acts. Who in China today knows about or is interested in Friedrich Engels, the Manchester industrialist and exploiter, or in Plekhanov, Martov, Gorki, or Kautsky? The number of Chinese billionaires is larger than the parallel number in the US. But the Party controls ‘private' Chinese industry and trade. Exactly how this is done is known only in outline, or not at all. There seems to be a reporting system, whereby reliable Party cadres report to higher instances exactly what individuals do, in the economic social, and cultural spheres. This is, more or less, the way the Mandarin class under the Manchu and the Ming (and before that), operated. This is also the way the Soviet nomenclatura handled things. The Mandarin class recruited itself, by and large, from the lower and upper middle class, trained the most promising individuals, and integrated them into the ruling stratum of society. The breakthrough occurred in about the 15th century, when the Ming began to include the merchant class (in addition to the landowning class) in the population from which the cadres were drawn - in a general population of about 200 millions. The Manchu continued this tradition, though the top positions were still reserved for the Manchu conquerors themselves. The CP does the same: it recruits its cadres from the general literate society, and with 1.3 billion people around there are many good candidates. They are integrated into a Party that builds its persuasiveness on several foundations: a) success, over the past coupe of decades, which cannot be doubted, by any standards, in almost all spheres of a person's existence; b) tradition - historical memory of Chinese greatness; c) nationalist patriotism, even chauvinistic nationalism (we are better than anyone else, or: we are the heirs of the Middle Kingdom); d) opportunity in a growing and developing society with an optimistic view of unlimited success in the future. Instead of class struggle there comes, as indicated, the ideology of a supercilious nationalism.

Chinese international policies are characterized by great caution. The major principle which concerns issues of genocide prevention is support for any government that can protect Chinese interests, and opposition to any attempt to put pressure on such a government for any reason or purpose. I think that there are two main reasons for this: one is an historical one: China was occupied several times in its history by foreign powers: by the Mongols in the 13th-14th centuries, by the Manchu in 1644, and by the West in the 19th century. Foreign interventions in any country's affairs are therefore looked upon as bad, en principe. The other is the problems that China faces internally - Tibet, Xinjiang, and ethnic diversities of other groups. We don't want you to intervene in our affairs, and we will refuse to intervene in other nations' affairs.

Despite the argument about the lack of any moral sensitivity presented above, can one nevertheless see some weaknesses in this utilitarian armor? The Chinese need to save face in their relations with the rest of the world, and they are as capable as anyone to mouth the usual universalist clichés. They also are aware of the fact that as they control some 20% of the US debt, and are the main creditors of the Americans, they are also dependent on the health of the American market, both to secure their investments and to sell products in America. They may therefore be accessible to pragmatic arguments that touch their interests - both positively, i.e. in securing their present and future investments and markets, and negatively, by exposing them to risks. They are not accessible to Elie Wieselesque sermonizing.

As to the lack of public opinion or freedom of expression in China: the chances that this might yet develop are there, but they are not very bright. I would argue that there appears to be a possibility of the entrenchment of a new kind of capitalism-imperialism. Until now, we all thought that a successful capitalist society requires freedom of opinion and of action, things that can only be guaranteed by democracy. We equated capitalism with middle class, individualism, and democracy. China seems to show another possibility: private enterprise open to unlimited expansion and controlled by the government/party, combined with a dictatorship that guarantees that. Chinese entrepreneurs do not need democracy. They can get everything they want by placing themselves under the protection of Comrade Hu. This development, if it continues, presents the greatest possible danger to a West that is committed to a free (relatively speaking) society. There are precedents for such a situation: Nazi Germany permitted and even encouraged free enterprise, and its control system was arguably less efficient than the one practiced in China. Fascist and semi-Fascist states in Europe, Latin America, and elsewhere all practiced similar types of capitalism. Wilhelmine Germany, Tsarist Russia, and Meiji Japan all practiced what Jeffrey Herf calls "reactionary modernism", where feudal or backward-looking elements controlled a modern capitalist development, in the case of Germany and Japan even with a tightly-controlled parliamentary shop-window. The equation capitalism=middle class=individualism=democracy as an iron rule is demonstrably wrong.

I think that all this has to be considered against a much more general, historical background. We do not usually take into account that democracy is not only a weak reed, but also that it is very new. If democracy means formal equality of all citizens, then ancient Athens was not a democracy - it was built on slavery. Neither was the US, until the sixties of the last century, when the Civil Rights movement finally gave some legitimacy to the formal equality enshrined in the American Constitution, which by then was some two hundred years old, but had never been fully translated into practice. Britain had no equal rights for women until after World War I, nor did some other democracies. Very recently, democracy has again lost some ground, in Russia, in South Africa, and elsewhere; of course, these societies are still counted as democracies in typically self-delusionary fashion by some Western media. In fact, I would argue that, contrary to the widely accepted American ideology, people do not normally fight for democratic freedoms. If left alone, they rather tend to hide in conservative family, clan, and ethnic structures, which give them greater personal security and provide a familiar environment. If we want to advance democracy, we have to realize that this is a constant struggle, which sometimes (perhaps oftentimes) has to take place against instinctual opposition. China is an excellent example where, apparently, masses of people do not feel any need to change an authoritarian system to which they have become historically attached. Capitalism without democracy seems to be an option, and a pretty dangerous one. Genocide prevention, among other issues, will not be advanced until we find ways and means to persuade the Chinese bureaucracy. At the moment, this can only be done by putting ourselves in their shoes and argue from their own interests, as it were.

There are several basic principles followed by Chinese foreign policy: one, sovereignty. This, again, is part of a historical legacy in which China was, repeatedly, conquered by foreigners, and defense of the country and its people, the Han majority, is a basic reaction. We will allow no one to mess with Tibet and Xinjiang, and we will not interfere with others. Two,  togetherness. China prefers a common, non-military approach to contentious issues, except when areas considered by China to be Chinese (Taiwan, some islands in the Sea of China, etc.) are the issue. Togetherness stands in contradiction to sovereignty, and this is a dialectic that should be exploited for prevention of genocidal situations. Three, as already stated, the absolute supremacy of Chinese economic interests

There is a wonderful dog story from communist times: two dogs met on the border between communist Czechoslovakia and Austria. The Austrian dog was thin and all bones, and the Czech dog was big and fat. The Czech dog wanted to cross into Austria, and the Austrian dog asked him why. Look at me, he said, I am all skin and bones, and you are big and fat. Yes, said the Czech dog, but I would like to bark, just once, please. The Chinese dog seems to be growing fat, while on a tight leash, and he feels no need for barking. We do, and wonder how to do it effectively, so our bark is heard in Beijing.

What could be the options? One, any approach to China should start from a guarantee of Chinese investments and interests. Two, utilitarian arguments should be put forward. Example: a new North-South conflict in Sudan will endanger Chinese interests, because most of the oilfields are in the South, the pipeline crosses through disputed territory, and the port, Port Sudan, is controlled by the North. Hence, an approach to China could well emphasize that there is a common need (‘togetherness') to guarantee economic interests as embodied in Sudanese documents granting oil concessions to China. A recent report talked about new Chinese oil concessions in Southern Darfur. If this is correct - I do not know whether it is or not - then one could extend the argument to Darfur. The argument of lack of stability in Sudan might also be of some importance, if the government does not succeed in totally wiping out rebel opposition in Darfur. An approach to the French regarding Chad may have to be made before one talks with China about Darfur. Detailed knowledge of internal Zaghawa policies, and the tortuous behavior of that great humanitarian, Mr. Deby, would be a precondition, of course. But one should always remember that no Chinese politician will agree to do anything drastic about the government in Chad. Three, although any economic pressure on China is totally unrealistic, one should remember that as China is the major creditor of the US, it has a vital interest in the well-being of the American economy. In other words, they need Americans to buy Chinese products. Greg Stanton has argued in favor of more attempts to achieve public support for action on Darfur, despite past failures. Eyal Mayroz has shown, in his paper for this meeting, that there is a gap between public support, in principle, of a pro-active policy on Darfur, and its translation into pressure that will impact on decision-makers. There is the danger of ‘sham compliance', i.e. of seeming agreement with the principle of acting on Darfur, and real action. But there are, in relatively recent American history, examples of issues that did not affect the immediate interests of Americans (e.g. Soviet Jewry) where effective pressure could be put on policy-makers. This has to be done in an American way, i.e. grassroots organization, down to block stewards, local politicians, and, very importantly, religious organizations. Such a movement may affect customer behavior, and cause disinvestments and so on, without actually declaring an economic war on China. One could then argue with the Chinese that it is not worth their while opposing an active policy that will force Khartoum to arrive at compromises, if the price for the lack of action endangers Chinese economic interests.

In conclusion, I would argue that there is a possibility, hopefully, of influencing Chinese policies, provided of course we find Western governments who would be willing to take that path.

 

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