Globalization

[Airbornelawyer]

Originally Posted by ghuinness

Globalisation yes, but for what purpose? I don't agree with you that the underlying motive is purely economic. China is helping China in order to encircle the USA. I don't trust them and I wish people would wake up and see the game China is playing. That will never happen as long the focus is the P&L statement.

my .02

The underlying motive is security, of which economic security is just one component.

Others more knowledgeable on Chinese affairs than I have argued that China does not seek to isolate or encircle the US, but to ensure that China cannot be isolated and encircled. They argue that China seeks the same sort of hegemony in East Asia that it views the United States as enjoying in the Western Hemisphere since the advent of the Monroe Doctrine.

There is some argument as to how much hemispheric security we actually enjoy, given Cuba, narcotrafficking and transnational terrorism, but for most of our existence we have been relatively unthreatened in our hemisphere. None of the major nations of the hemisphere - Brazil, Mexico, Canada - or the second-tier - Argentina, Chile, Colombia, Peru and Venezuela - are serious threats to the US (though Venezuela may become a thorn in our sides), and all but Cuba are formally our allies. The Monroe Doctrine is not as absolute as it was a century ago, but non-American powers generally defer to the US in the region. German attempts to fill a power vacuum created by Spain's defeat in 1898 were soundly rebuffed in Venezuela and Mexico, as were Soviet attempts in Central America.

From China's perspective, it is the one that is encircled. China's only reliable allies in East Asia are relatively inconsequential states - Burma, Laos and North Korea - and the last of these is proving a troublesome ally. Meanwhile, China borders or faces Russia, India, Vietnam, South Korea, Japan and Taiwan, all major states or economic powerhouses (compared to China, Vietnam is small, but it is the 13th largest country in the world) and all threats in various ways to Chinese hegemonic ambitions. Furthermore, while China's only close ally in the Western Hemisphere is Cuba, the United States has allies throughout East and Southeast Asia, the most important being South Korea, Japan, Taiwan, the Philippines and Thailand, but Australia could also be added to the list. And to the extent the US improves its relationships with other countries of the region - Russia, India, Mongolia, Indonesia, even Vietnam - it fuels the Chinese perception of encirclement.

Economic measures address this fear in part two ways: one, securing access to natural resources and high-technology improves China's overall power. Second, enmeshing the US, EU Japan and other powers in a web of economic interests leads us to deter ourselves from acting against China's interests, since there are more and more non-Chinese whose own economic interests are tied to China's.

Thanks AL.

If anyone is interested I found a recent article by
Wang Xiaodong

A rising China counters US clout in Africa

[NousDefionsDoc]

Good. We have no complaint since we have basically abandoned Africa to its fate.

The same thing will happen in LATAM unless the admin gets on the ball. Venezuela, Ecuador, etc.

Originally Posted by NousDefionsDoc

Good. We have no complaint since we have basically abandoned Africa to its fate.

The same thing will happen in LATAM unless the admin gets on the ball. Venezuela, Ecuador, etc.

Good?

I understood from your post above that suggesting Africa was ludicrous.

Expansion is already occuring in LATAM and elsewhere.

- China is putting the squeeze on Australia.
- controls the Panama Canal and made agreements in December with VE for shipping
- aggressively pursuing interests in the Caribbean

But according to everyone this is all economic security. I don't believe it.

[NousDefionsDoc]

Suggesting Africa was ludicrous as far as what?

Are you confused? Africa investing in China as FDI? Not happening. China engaging Africa? Happening. There is a difference. You seem to think China is a Gap state - its not anymore. Africa is a Gap continent (with exceptions noted). If China wants to engage Sudan, Somalia, etc. - more power to them. It will be interesting to see how China manages the associated security issues. As China accepts the new rules they will have to accept from the Core, those rules should trickle down to Africa. It will take forever that way, but it will happen.

You have to accept a few basic premises or you won't get anywhere.
1. The US is not the only economic entity in the world.
2. The EU and Asia, probably led by China in the future will be near-peer competitors in the economic arena.
3. Asi es la vida.
4. Competition is not necessarily a bad thing - it keeps us from getting lazy.
5. We will not have a war with China.
6. If we abandon an area, we have no right to whine when somebody else moves in.
7. We can't do it all by ourselves economically. Militarily yes, economically no.

You need to stop looking under the bed for the boogeyman. There isn't one big one, there are a lot of little ones. China is on the right track - don't try to derail them. They are trying to join.

Unchecked growth causes problems. They will hit their own snag and have to take a step back.

It'd be very interesting to hear if you think the same way after reading those Chinese Colonels' book, NDD. Please, if you read it, mention your take on it.

[Airbornelawyer]

China is not exactly new to Africa. Anyone remember Admiral Cheng Ho (Zheng He in pinyin)? The Mings intended to expand their dynasty south and west, turning the Indian Ocean into a Chinese lake. But internal problems - mainly the cost of the admiral's expeditions - and the ever-present threat from the north caused the Mings to abandon these plans.

More recently, while the US and its allies were busy trying to contain Soviet communist expansion in Europe, the Middle East, Southeast Asia and Northeast Asia, we also "basically abandoned Africa to its fate." Africa was a problem for the colonial powers, increasing becoming the former colonial masters - France, the UK, Belgium and Portugal. US interests were minimal, and mainly amounted to aiding these European countries (but not to maintain their empires) and occasionally countering Soviet and Cuban inroads. China viewed Africa as an opportunity then, and moved to sell arms and build up friendly Maoist groups. China's successes in building a network of African clients were, shall we say, less than stellar. A number of countries accepted Chinese arms and Chinese advisors, notably Tanzania (where Nyerere also fiddled with Chinese ideology and his own version of the Great Leap Forward), but as soon as a better offer came along, jumped ship to either the Soviets or the West. China's successes mirrored those in East Asia, where the major powers became Soviet or US allies/clients while China settled for Burma and Laos. Or Europe, where China's great success was Albania, and even Albania abandoned them after Mao.

The "major" powers in Africa - South Africa, Nigeria, Congo/Zaire, Ethiopia - were either Soviet or Western allies.

China settled for a string of South Asian and Middle East states which would never be reliable allies or share China's ideology but would at least buy their weapons, even while preferring US, Soviet, French or other European suppliers - mainly Burma, Bangladesh, Pakistan, Iran and Iraq.

In the 1990s, China shifted from ideological to economic motives for its arms sales, though profits aren't necessarily the main component - building a better technological base for its arms production is also a major factor. And who have been China's main customers in the 10-15 years? Burma, Bangladesh, Pakistan, Iran and Sri Lanka:

• Burma (Myanmar): 150 Type YW-531/Type-85 APCs (1993); 50 Type-69-II MBTs (1993); 50 Type-63 light tanks (1993); 30 Type-63 107mm MRLs (1993); 4 Type-311 fire control radars, for use with 24 Type-74 37mm AA guns (1993); 12 F-7M fighter aircraft (1998-99); 36 PL-2A SRAAMs (1993) and 36 PL-5B SRAAMs (1998-99), for use with the F-7Ms; 6 Houxin Class FAC(M) (1995-97); 48 C-801K/CSS-N-4 Sardine air-launched anti-ship missiles, for Houxin Class FAC(M)s (1995-97); 12 K-8 Karakorum-8 jet trainer aircraft (1999)
• Bangladesh: 5 Type-653 ARVs (1993); 1 T-43 Class minesweeper (1994); 1 Haizhui Class patrol craft (1995); 18 Type-59-1 130mm towed guns (1996); 4 F-7B fighter aircraft (1999-2000); 21 HN-5A portable SAMs and 114 RED ARROW-8 ATGMs (2001).
• Pakistan: 750 QW-1 Vanguard (Anza-2) MANPADS (1994-2003); 20 Type-653 ARV (1995); 36 LY-60 SAMs and 3 LL-1 fire control radars for modernized Tariq (Amazon) Class frigates (1996-97); 4 Y-12 transport aircraft (1996-97); 36 LY-60 SAMs and 3 LL-1 fire control radars for modernized Tariq (Amazon) Class frigates (1996-97); 16 C-802K/CSS-N-8 Saccade anti-ship missiles and 2 Type-347G fire control radars for Jalalat Class FACs (1997-99); 57 F-7PG fighter aircraft, including 6-9 trainer versions (2001-03); 6 K-8 Karakorum-8 jet trainer aircraft (2003).
• Iran: Between 1996 and 1999, Iran took delivery of 80 C-802/CSS-N-8 Saccade anti-ship missiles for its Kaman Class (Combattante-2 Type) FAC and 24 C-801K/CSS-N-4 Sardine air-launched anti-ship missiles. In 1996, it received 5 F-7M fighter aircraft; 14 Y-7 transport aircraft were ordered in 1996, of which 8 appear to have been delivered, with the rest expected in 2005-06; 9 Y-12 transport aircraft were delivered in 1994-9; in 2002-03, Iran received 35 FL-6 anti-ship missiles, a copy of the Italian Sea Killer ASM for use on Iran's SH-3D helicopters.
• Sri Lanka: 1 Yuhai/Wuhu-A Class landing ship (1995); 3 Haizhui Class patrol craft (1996); 1 Haiqing Class patrol craft (1996); 3 Shanghai Class patrol craft (1998); 2 Lushun class patrol craft (1998); 36 Type-66 152mm towed guns (1999); 10 CJ-6 trainer aircraft (2000); 6 K-8 Karakorum-8 jet trainer aircraft (2001)

From a military perspective, it would seem China's main focus in these deals is containing India, with garnering hard currency a second priority.

China's other major deals in this period also have a regional/economic focus. Two deals were inked with Kuwait: a 1998 deal, with delivery in 2000-01, for 27 PZL-45 155mm SP guns, 1 Type-653 ARV, 4 Type YW-531/Type-85 APCs, and 27 PCZ-45 ALVs; and a 2001 deal, with delivery in 2002-03, for 24 PZL-45s, 1 Type-653, 4 Type YW-531/Type-85s, and 24 PCZ-45s. Thailand received 1 Similan Class support ship (1996) and 28 C-801/CSS-N-4 Sardine anti-ship missiles (2000). Neither Kuwait or Thailand, though, is likely to choose China over the US in a conflict.

In Africa, Arab North Africa was a better market than Sub-Saharan Africa, though both pale in comparison with Asia. Between 2000 and 2002, Algeria took delivery of 24 C-802/CSS-N-8 Saccade anti-ship missiles for its Djebel Chinoise Class FACs. Between 2001 and 2004, Egypt received 80 K-8 Karakorum-8 jet trainers. Sudan got 6 F-7M fighters in 1997 and Tunisia received 3 Haizhui Class patrol craft in 1994.

As for Sub-Saharan Africa:

• Eritrea: 4 Y-12 transport aircraft (1994).
• Kenya: 9 Y-12s (1997).
• Mali: 2 Z-9B (AS-365/AS-565) helicopters (2000).
• Mauritania: 2 Y-12s (1994-95) and 1 Y-7 transport (1997).
• Namibia: 2 Y-12s (1997) and 4 K-8 Karakorum-8 jet trainers (2001).
• Sierra Leone: 1 Haizhui Class patrol craft (1997).
• Tanzania: 2 Y-12s (1994).
• Zambia: 3 Y-12s (1996) and 8 K-8s (2000)

I don't have data for small arms transfers, where China has had somewhat more success since its lower tech weapons are still cheap and reliable.

In Africa today, China seems to be falling into the same pattern as before and elsewhere. It may be looking for oil in Angola and building roads in Rwanda, but it does not have the impact or clout of Western nations. The countries where it is gaining the most influence are, once again, rogue states that few others will deal with - Sudan and Zimbabwe.

On the other side of the equation, I should note that the United States has not abandoned Africa, nor has it any intention to. That same impetus that is pushing China to expand its efforts in Africa - the need for oil and minerals - is also keeping the US engaged there. And we have strategic interests, especially in the Sahara and the Horn of Africa, that China does not.

Among the top suppliers of crude oil to the United States, Nigeria ranks 5th and Angola ranks 7th. We are by far Angola's largest export partner (the trade deficit we run with Angola doesn't seem to bother anyone though). Gabon ranks 14th, but we receive over half of Gabon's production. Algeria is 15th (about 90% of Algeria's production goes to Western Europe, mainly Italy and France). We are also heavily involved in developing Equatorial Guinea's oil industry, as well as others on the Gulf of Guinea, but none of these are as important as Nigeria, Angola, Gabon and Algeria.

Our national security interests keep us focused on those states where AQ and other Islamist terrorists have made inroads or coudl affect us - Tanzania, Kenya, Somalia, Djibouti, Sudan, Chad, Mali, Mauritania, Nigeria, Niger, Algeria, Morocco, Tunisia, Libya and Egypt - but we are also involved elsewhere.

The main FMS recipients over the past few years include Botswana, Ethiopia, Ghana, Guinea, Mali, Nigeria, Senegal, South Africa and, until 2001, Zimbabwe. Main Foreign Military Financing Program recipients are Nigeria, South Africa, Botswana, Kenya and Senegal. For commercial sales, Nigeria, South Africa and Botswana are the main buyers. Top IMET recipients are Botswana, Ethiopia, Ghana, Kenya, Nigeria, Senegal and South Africa. The leaders for ACRI (now ACOTA) training has been Senegal, Uganda, Malawi, Mali, Ghana, Benin, Côte d'Ivoire and Kenya.

As a theater of American interest, Africa certainly pales in comparison with the Middle East and East Asia, and is behind Latam and Eastern Europe, but we are far from abandoning it to the Chinese or anyone.

[vsvo]

"The Chinese are very nice[.] They don't have anything to do with any politics or problems. Things move smoothly, successfully. They are very hard workers looking for business, not politics."

Sudan's Energy and Mining Minister Awad Ahmed Jaz

China Invests Heavily in Sudan's Oil Industry
Beijing Supplies Arms Used on Villagers

By Peter S. Goodman
Washington Post Foreign Service
Thursday, December 23, 2004; Page A01

[Roguish Lawyer]

AL:

The coolest thing I saw at the National Palace Museum when I was there in like 1988 was a Ming vase with Arabic writing on it.

Anyone who hasn't been there should go. Best art museum I have ever been to.

[NousDefionsDoc]

I thought we agreed

The countries where it is gaining the most influence are, once again, rogue states that few others will deal with - Sudan and Zimbabwe.

but I was wrong

but we are far from abandoning it to the Chinese or anyone.

Abandon is a relative and subjective term with the US. There are many in LATAM that feel abandoned as well.

Originally Posted by NousDefionsDoc

Are you confused? Africa investing in China as FDI? Not happening. China engaging Africa? Happening. There is a difference. You seem to think China is a Gap state - its not anymore. Africa is a Gap continent (with exceptions noted). If China wants to engage Sudan, Somalia, etc. - more power to them. It will be interesting to see how China manages the associated security issues. As China accepts the new rules they will have to accept from the Core, those rules should trickle down to Africa. It will take forever that way, but it will happen.

.....

You need to stop looking under the bed for the boogeyman. There isn't one big one, there are a lot of little ones. China is on the right track - don't try to derail them. They are trying to join.

Unchecked growth causes problems. They will hit their own snag and have to take a step back.

NDD. Sorry, not running off on this one.

Confused? I hope so. I don't have a rosy picture.

FDI? Your original question: “Where will they have to go to get the money”. All my answers pertained to import/export. Given China’s current status FDI should be next to impossible to achieve hence their focus on trade. Obviously some nations will turn a blind eye, they already have. The IBM deal was a perfect example; it was backed not only by Chinese banks but EU and American banks. Clearly China does not meet IMF and WTO requirements, but that did not deter investors. Today, Bank of America announced it is considering a substantial investment in a large Chinese Bank in the range of $14B. This doesn't concern you?

I am not looking for the “boogeyman” as you put it. In fact, it is the opposite. The more I try and disprove my fears, the more questions I find. I started with the Law of the Sea Treaty (LOST) trying to answer the simple question: Why is Condi pushing this? What is so important about this Treaty that addresses our “National Security”?

I looked at it from every conceivable angle and determined its greatest impact was to trade; the economy. Everything pointed to China. I started reviewing their trade agreements: with who and when. Timing on some of these agreements was the next thing that hit me. One deal that stood out occured Feb 2; China loaned Russia $6B which was speculated to be a loan to obtain leverage. Russia coincidentally then pays off it’s debt with the IMF which wasn’t due until 2008. What did Russia do next? Sign agreements with Iran and Syria. Convenient? Coincidental? Reading too much into it? Hedging their bets as you put it?

I don’t expect a direct Military war with China. I do expect economic strangulation, that is what I mean by "encircling the USA". I don't doubt China would use their Military against weaker trading partners.

I agree China will falter. The question is how hard, how far will the reverberations be felt and how will they react. I see a lot of parallels to the market today and the status of globalisation in 1914.

my .02

Ghuinness,

You know what really struck me about your post?

That the banks were able to figure out what a good investment was, and the IMF wasn't.

[NousDefionsDoc]

Yes, FDI. You can't get trillions to build infrastructure through trade - takes too long and you need the infrastructure for the trade.

Clearly China does not meet IMF and WTO requirements, but that did not deter investors. Today, Bank of America announced it is considering a substantial investment in a large Chinese Bank in the range of $14B. This doesn't concern you?

And you think you know something they don't. No, it doesn't concern me, it makes me wish I had money to invest.

I am not looking for the “boogeyman” as you put it.

Yes, you are. Read your posts in this thread again and tell me you're not with a straight face. Again, what do you want done about China? You have listed all your fears, what do you want us to do to/about/on/at them?

You honestly think any one country can economically strangle the US?

I agree China will falter. The question is how hard, how far will the reverberations be felt and how will they react. I see a lot of parallels to the market today and the status of globalisation in 1914.

Interesting that you say that. What was our response in 1914 and what was the result? Even a little before that.

[Airbornelawyer]

Originally Posted by NousDefionsDoc

I thought we agreed

but I was wrong



Abandon is a relative and subjective term with the US. There are many in LATAM that feel abandoned as well.

That's why I said "pales in comparison with the Middle East and East Asia" but "is behind Latam and Eastern Europe." All of these theaters are lagging as resources and attention go to the Middle East.

Obviously, these things fluctuate over time. Central Europe was the main theater for decades, with Latin America, the Middle East and East Asia peripheral, and then only in the context of the long twilight struggle with Soviet Communism. And, of course, before 1941 or so, we cared little about anywhere but Latin America and the Caribbean.

Right now, for obvious reasons, the focus is on the Middle East and East Asia. Resources are being diverted from Europe (that 1-year mission in Bosnia is finally effectively over) and Latin America (to the extent there were many resources there in the first place).

For Latam, in the long-term this represents a geopolitical shift. Since the 1970s, most of the region has shifted to relatively stable democracies, albeit with problems. Cuba is now the only unfree state in the Western Hemisphere, though Venezuela's future is in question. We remain concerned about Colombia and narco-trafficking/terrorism links there and elsewhere in the region. A Chavez-Castro alliance is worrying, but fears of a new left alliance of Lula!'s Brazil, Venezuela, Cuba and Zapatero's Spain seem to have abated. I don't think anyone thinks Brazil will be a military threat to the United States.

You want a metric? (probably not, but here goes )

Total US Foreign Military Financing in 2004 was about $4.6 billion. For 2005 it is estimated to be $4.7 billion and the Administration has requested $4.6 billion for 2006. Looking at 2004, by region:

Africa: $20.9 million
East Asia and the Pacific: $24.7 million
Europe and Eurasia: $191.0 million
Near East: $3,728.6 million
South Asia: $494.7 million
Western Hemisphere: $119.6 million

Africa certainly gets the short end of that stick. East Asia and the Pacific is low because most of the states in the region pay for their own defense. The Near East dominates, but that is because almost 75% of FMF went to two countries, Israel (46.5%) and Egypt (28.0%), while Jordan accounted for 4.4%.

Six countries - Israel, Egypt, Afghanistan, Jordan, Colombia and Pakistan - together accounted for 91.5% of 2004 FMF. Add in Turkey, Poland, Oman, Bahrain, the Philippines, Bosnia, Yemen and Georgia, the only others over $10 million, and you pass 95%.

The estimates for 2005 show some differences. Every region but the Western Hemisphere went up, though Colombian FMF remains about the same. The Philippines got an extra $10 million, but Bosnia went down by that amount. Egypt, Israel, Jordan and Afghanistan remained about the same, while Pakistan, Bahrain, Oman, Yemen got less and Morocco got more.

The request for 2006 also show differences, and Administration priorities. For the Western Hemisphere, the focus remains on Colombia and counternarcotics/counterterrorism. El Salvador's request jumps considerably, mainly due to costs of its Iraq deployment (and as a reward for staying the course when other Central American states bailed). Homeland security gets a boost, as Mexico goes from $0 to $2.5 million and Operation Enduring Friendship, an initiative aimed at improving border security and maritime interdiction capabilities in the Caribbean and Central America, gets $5 million.

The Near East stays the same, while in South Asia a jump in Pakistan's FMF is offset by the elimination of Afghanistan's. Africa, East Asia and the Pacific and Europe lose money. In Europe, Poland and Turkey get less, but coalition partners Bulgaria and Romania get much more. Ukraine was slated for a big jump, but since it decided to withdraw from Iraq this may go down.

FMF, of course, is only part of a bigger picture. Some countries, like Japan and South Korea, don't get FMF because they can pay for their own weapons, or they often get significant assistance in the form of EDA (excess defense articles), or US hand-me-downs.

Every country in Latin America is eligible for EDA. For example, in 2001, we gave Brazil 91 M60A3 main battle tanks, 4 frigates and 2 LSDs. In 1998-99, Argentina got a brigade's worth of small arms and equipment (57 M113A2s, 25 M106A2 mortar carriers, 20 M577A2 CP carriers, 25 M578 ARVs, 1945 M16A2s, 349 M249 SAWs, 245 M203s, 1600 LAWs, 71 1 1/4-ton trucks, etc.).

In 1999, the Peruvian Navy received 4 LSTs.

In 2003, we offered Mexico 70,000 cans of paint.

We have given Poland two frigates, the USS Clark in 2000 and the USS Wadsworth in 2002.

EDA doesn't just go to poorer countries, but to anyone eligible. We gave Germany, for example, 7.7 million rounds of 7.62x51mm in 1997, along with 55,664 hand grenades, 896 antitank mines, about 120,000 20mm rounds, and 7 shotguns. France received 2 KC-135 tankers in 1995.

And sometimes the country rejects the hand-me-downs. Mexico returned some 70 helicopters in 1999 as inoperable. Turkey rejected 50 A-10s in 1993, along with 15 of 27 AH-1 Cobras.

Turkey is probably one of the biggest EDA recipients, though, along with Greece, Egypt, Israel and Taiwan.

Another area of US military assistance, IMET, is more favorable to Latin America. For 2004, the Western Hemisphere received $13.4 million of the $91.2 million allocated to IMET, but 5,021 of the 11,832 students trained were from the Western Hemisphere, mainly Bolivia, Colombia, Argentina, Mexico, El Salvador and Honduras. Africa was funded to $11.2 million and 1,683 Africans were trained, mainly from Zambia, Sierra Leone and Guinea. The biggest chunk, $35.5 million, went to Europe, where 3,149 soldiers were trained. The biggest groups were from Romania, Ukraine, Bosnia, Turkey, Hungary and the Czech Republic.

The relationship between money and numbers of students changes, though, depending on the standard of living of the country, the types of students trained and the types of training. Sending a dozen Ugandan sergeants to ANCOC probably costs less than sending one Russian colonel to a war college. Also, I don't think SOA (or whatever it's called now) is funded through IMET.

EDA, by the way, is something where we have a definite edge over China. Since our standard weapons are in many cases two generations ahead of China's (or Russia's for that matter), our hand-me-downs are often better than or as good as their sale items, and certainly better than their hand-me-downs. We give away M60A3s, they give away T-55/Type-59s. We give away F/A-18s, they give away MiG-21s.