Exporting the Chinese model of development

Edward Wong has a good article in today’s New York Times about how the use of Chinese labor to build and run Chinese foreign investments is generating a lot of anger in those countries.  Because China is investing in a lot of poor countries where jobs are hard to find, the anger is understandable. I think this gets to the central idea of why China’s model of capitalism is not a good one to export.  While many have praised China for its no-strings-attached model of foreign aid, this misses the danger the model presents. Minxin Pei recently pointed out that despite China investing and exporting all over the world, China plays a very small role in international institutions. Pei argues the reason for this is because the Chinese government is more concerned about domestic politics, specifically maintaining economic growth, than solving international problems.

I think this gets to the central problem of the Chinese model of development. China is perfectly happy to provide no-strings-attached-aid to get natural resources, for example. The reason for this is not because the Chinese are benevolent. Rather, its because access to the resources is important for China’s domestic policy. Exporting labor has the same effect: it creates jobs for Chinese workers. China’s model is not new; in fact its very old and it did not end well. It’s essentially economic colonialism. In the 19th century, all the Great Powers in Europe basically had China’s policy today and the result was World War I. The international institutions we have today – imperfect as they are – are based on the premise that coordination of foreign policy is necessary to avoid the problems that uncoordinated self-interested policy tends to create. If all countries followed China’s policies today, global war would be far more likely than global peace and prosperity.

Explaining Myself on Obama and Democracy

My posts on this blog tend to address three themes. One, topical stories that don’t always make the front page, such as my recent posts on Honduras and Switzerland. Two, Afghanistan because of its importance to US foreign policy and because better governance is integral to ending the war.  Three, criticizing the Obama administration for its apparent preference for stability over democratization.  Sometimes a post from the third category has been a bit of a rant, so I want to explain myself. Continue reading »

United Russia looks East

The “China model” has garnered attention as an alternative for liberal development, but comparisons are largely drawn on the experiences of economic liberalization taking place under one-party dictatorships in Southeast Asia. Outside these regional comparisons, the Chinese Communist Party (CCP) seemed to have little applicability to political organization in the rest of the world. Now, according to this New York Times piece, Putin’s United Russia party believes the CCP deserving of study. The article describes a special meeting held earlier this month that featured senior Communist Party officials describing their ruling methodology and quotes from various United Russia leaders on the value and success of the CCP template.

China itself has a similar history of sending its officials abroad to learn techniques of governance they believed suitable for China’s future. Since the 1980s the CCP has demonstrated interest in the People’s Action Party (PAP) in Singapore. David Shambaugh’s book, China’s Communist Party: Atrophy and Adaptation, reveals that the CCP values the PAP model for “guided democracy” in which the PAP sustains itself through successful policies and co-optation of the opposition”.

Each of these cases is evidence of oft assumed authoritarian cooperation, but what the implications of this learning between authoritarians are for democracy advocates and practitioners is unclear. The ability of democracy assistance or democracy/reform advocates to exert any kind of pressure on authoritarian regimes is minimal. However, a regime’s selection and analysis of case studies is perhaps indicative of direction. In China, corruption could potentially undermine the ability of the CCP to claim itself an efficient manager and capable steward of economic expansion. Singapore is the logical choice for the CCP to study given its economic success and the PAP’s ability to retain control of the state during and after economic modernization. Shambaugh believes the interest of the CCP in semi-authoritarian regimes is one example of the CCP undergoing renovation in order to retain power. If similar direction can be assumed from United Russia’s choice of China as a model then the implications are less positive. That direction might best be summed up by Sergei Mitrokhin, leader of the liberal pro-Western Yabloko party, who is quoted in the NY Times article as saying “the China meeting demonstrated that United Russia wants to establish a single-party dictatorship in Russia, for all time”.

Guinea, China, and the Utility of Sanctions

Following the attack by the military on demonstrators who had gathered to protest in a soccer stadium in the capital, Guinea’s coup leaders face increasing international pressure. The AU, EU, the regional organization Ecowas, and the UN united to call for targeted sanctions against the military.  It is unclear what impact sanctions can have on the conflict. According to the Economist Intelligence Unit, Guinea’s economy is dominated primarily by subsistence farming and mining. Bauxite and aluminum constitute around 60% of exports annually and a further 25-40% come from gold and diamonds. This suggests few avenues for effective sanctions and even fewer opportunities for targeted sanctions that punish only the military.

Further undermining the ability of sanctions to produce desired outcomes are $7bn from Beijing. Chinese interest in Guinea is surprising. Earlier in the year the New York Times reported that Chinese investors were becoming weary of pumping resources into the more politically unstable countries in Africa. This suggests that the Chinese government is convinced  the military can provide enough stability to protect its sizable investment, which greatly exceeds Guinea’s annual GDP of $4.6bn

The growth of Chinese aid to Africa is well-documented elsewhere, but it remains unclear what the consequences of Chinese aid will be. The initial popularity of Chinese investment is dwindling in many parts of Africa. Headaches caused by anti-Chinese sentiment in these countries combined with international pressure for Beijing to act responsibly in its role as a global power have forced Beijing to confront the limits of “no-strings attached”.

For example, fecklessness by the government in Burma and strong international support have dampened China’s unconditional support for the military regime in Naypyidaw. The ability of China to influence its more unsavory allies should not be overstated, but China has shown an interest in moderating these regimes both for its own investors and its credibility as a rising power. It remains to be seen if China can exert similar influence in Africa or if it will be interested in doing so. However, in Guinea the international community has little leverage to force compliance. If China can develop that leverage on Camara and his cronies in Conakry, then the strategy of international outrage combined with ineffective sanctions should be reconsidered as the preferred response to human rights crises.

A Snub from One Nobel Prize Winner to Another?

The Nobel Committee said in its press release that it was awarding the Prize to Obama because he promotes a world in which “Dialogue and negotiations are preferred as instruments for resolving even the most difficult international conflicts.” Apparently this does not extend to engaging in dialogue with dissidents of an economically powerful country with which the United States wishes to maintain “a very robust bilateral agenda” that includes trade and security.

Obama has received a lot of flack already over the decision not to meet with the Dalai Lama while the Tibetan leader is in DC this week to receive a human rights prize from Congress on Capitol Hill, which was awarded Tuesday. But the decision to award him the Nobel Peace Prize makes the situation almost comedic – the most recent prize winner is refusing to meet with the laureate from 20 years ago over issues regarding peace and human rights because he is afraid of disturbing an increasingly warm relationship with the oppressor.

When South Africa refused a visa to the Dalai Lama in March 2009, the United States did not quite condemn the move, but it did reaffirm that “the Dalai Lama… is a regular visitor to the United States and we do not miss an opportunity to try and have discussions with him.” Except, it would seem, when doing so might put a shadow on upcoming trade talks with China. This is certainly not the first time this administration has played down concerns over human rights violations in China; Secretary Clinton started off the relationship in February by saying she was not going to push the human rights button. So in many ways this represents continuity with the current administration’s stance. But while the Obama government might think that they’re giving up the issue because it will not go anywhere, it is obvious this is not the case. If human rights pressure really was not affecting Chinese policy, why should that country be so touchy about it? Without a watchful and concerned international community, the state of rights inside China could be much worse.

The Dalai Lama has said that he is not offended and does “not want to create inconvenience to anybody,” which is ultimately self-defeating. Leaders not meeting with him may soon become a trend: Australia’s Kevin Rudd decided not to meet with the Dalai Lama in December for similar reasons of not wanting to rock the boat with China. Freedom House has more examples of Chinese pressure winning out over human rights concerns. With declining outside pressure, the Chinese will be free to repress its dissidents, confident that it is too important to be attacked on such trivial matters as domestic human rights concerns. The same is true in other parts of the world, like Egypt, where the United States has failed to show support to advocates of democracy and justice.

While Obama’s policy might be understandable from the standpoint of US economic interests, it is certainly not befitting of the winner of the Nobel Peace Prize. I hope that this award gives him a reality check to see just that.