The Pragati Podcast: What’s Happening in China?

 Indians and Indian news outlets are rightfully concerned with the ongoing Chinese aggressions in Ladakh and the India-China border conflict that could escalate any day. On Episode 150 of The Pragati Podcast, Hamsini Hariharan helps listeners take a peek at what is happening within China since the Coronavirus pandemic started, how the Chinese economy and politics are faring, and explores what else is occupying China’s foreign policy today.

Hamsini Hariharan started The Pragati Podcast along with Pavan Srinath in April 2017, and was a co-host for close to 70 episodes. Currently, Hamsini is the host of States of Anarchy – a weekly podcast on global affairs and foreign policy. She also writes a weekly column for CNBC News-18 on Chinese politics and policy. She is a visiting faculty at the Symbiosis Centre for Media and Communication. She is on @HamsiniH on twitter and @lady_baritone on Instagram.

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The Diplomat: China Doesn’t Understand Europe, and It Shows

 While his tour was designed to improve China’s post-pandemic image in Europe, some of Wang’s statements only made things worse for China. In Norway, while answering a question about the Nobel Peace Prize and Hong Kong, Wang said that China won’t allow the politicization of the Nobel Prize by interfering in China’s internal affairs — a response that many in the West read as a Chinese threat against awarding the Nobel Prize to Hong Kong protesters. Later, while in Germany, Wang criticized the Czech Senate President Milos Vystrcil’s visit to Taiwan and warned that it would incur a “heavy price” — another threat against a European country for doing something considered normal in a democratic state.[...]

China’s run of European mistakes started in 2012, when it decided to set up the 16+1 mechanism with the Central and Eastern European (CEE) countries, among them both EU members and non-members. Back then, China’s decision was watched with suspicion in Brussels and with every step China has taken in the CEE region the European Union’s fear of division has increased. While the EU seems to have gotten over the 2018 Visegrad (V4) moment, when China inaugurated a V4+China format for meetings with Hungary, Poland, Czechia, and Slovakia, and Wang even praised the V4 as the EU’s “most dynamic force,” things changed a lot in 2019. Two crucial moments were Italy’s decision to join the Belt and Road Initiative (BRI) and Greece’s addition to the 16+1. [...]

Moments like these have shown that China doesn’t understand the EU at all. While world powers no longer create agreements like the Treaty of Tordesillas, the idea of spheres of influence still exists in their minds. Sixteen formerly communist CEE countries teaming up with a communist great power set off alarm bells in Brussels. The EU doesn’t want any new “Berlin Walls” and it definitely doesn’t want to swap out Russian influence with Chinese in the CEE region, creating a new Iron Curtain. The European Union’s fear of division was mainly generated by China, which failed to understand how sensitive and important this subject is for Brussels. [...]

Sometimes, China doesn’t even seem to understand the basics of the European Union. The EU is a supranational entity, which receives its mandate from all 27 EU member-states, yet remains separate from the national institutions of each member state. The members of the European Parliament, although they come from each EU country, represent not their countries, but the EU. China’s failure to grasp the bloc’s basic structure became clear when it scolded the Estonian Ministry of Foreign Affairs after an Estonian member of the European Parliament went to Taiwan.

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The New York Times: When China Met Iran

Leaked news this month that China and Iran had come to the verge of signing a 25-year trade and military partnership agreement struck like a geopolitical storm in Washington — a rising rival of America and a longtime foe joining forces to threaten the United States’s predominant position in the Middle East. [...]

Yet in Iran and China themselves, the reaction was hardly ebullient. Critics of Iran’s beleaguered president, Hassan Rouhani, called the deal a new Treaty of Turkmenchay, after the notorious 1828 accord under which a weakened Persia ceded much of the South Caucasus to the Russian Empire. In Beijing, a government spokesman who was asked about the deal dodged rather than criticize Washington, insisting blandly that Iran is merely one of many countries with which China is “developing normal friendly relations,” and claiming not to have further information about the reported deal. [...]

In recent years, as the United States has been bogged down in unrewarding conflicts in the Middle East, China has been quietly expanding its economic, diplomatic and even military activities in the region. Beijing’s motives are straightforward but varied: It seeks to advance its interests, such as a pressing need for energy imports and for destinations for surplus capital and labor. In practice, it tries to advance President Xi Jinping’s signature Belt and Road Initiative, which is aimed at reshaping regional economic topographies in China’s favor and counters what Beijing sees as an American effort to contain it. In short, China seeks to establish itself in the eyes of the world — and its own people — as a great power capable of contending with the United States.

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The Bridge: Don’t Bring a Knife to a Gunfight with China

There are several durable reasons why China is the principal U.S. competitor least likely to employ insurgency—“the organized use of subversion and violence to seize, nullify or challenge political control of a region”—either directly or by proxy, in the future.[6] First, despite its global ambition and revisionist aims, China turned its back on supporting revolutionary insurgents decades ago. Second, China's approach to great-power competition focuses on economic competition, nonviolent subversion, and, if that fails, high-intensity warfare. Third, the international situation has rendered classic Maoist people's war anachronistic, as Chinese military thinkers recognize. Finally, China's leaders are acutely afraid of internal rebellion, and thus have strong normative reasons to not support insurgents. [...]

America's relationship with China is now transforming again. China is more powerful and aggressive than it has been at any time since Mao died in 1976. Xi Jinping, who became General Secretary of the Communist Party of China in 2012, is pursuing an ambitious plan to achieve China's “National Rejuvenation” which ultimately seeks to make China the world's preeminent political, military and economic power by 2049.[11] But despite his pretensions, he is no Mao.[12] As Xi himself said in 2009, “China is not exporting revolution.”[13] Whatever the failings of U.S. engagement, since Nixon, China has transitioned from a rogue state that actively armed Maoist groups around the world into a reluctant stakeholder in the international order that shows no inclination to support insurgencies abroad.[14] [...]

If “Hong Kongization” fails in Taiwan, China does not expect to deploy guerrillas to undermine Taipei as a last resort. Instead, the People's Liberation Army is planning to employ armed force in a conventional “local war” to compel Taiwanese submission.[25] The People's Liberation Army's role is to take advantage of a “Revolution in Military Affairs with Chinese characteristics” and prepare for these “local wars.”[26] This focus on “local war” explains why China is spending a lot of money to buy tanks, planes, ships, and even militarized islands, and why rather than training to support insurgencies, People's Liberation Army ground forces train to fight U.S. Army-style brigade combat teams in their major exercises.[27] Chinese leaders simply do not think that “high-intensity conventional maneuver war is out,” as Vrolyk argues. They are developing capabilities that will let them avoid and, if necessary, win a modern war, but they have not prioritized support to insurgent proxies. [...]

Given China’s existing strategy, military thought, and fears of rebellion, renewed state support for insurgents is far from certain. Instead, China is more likely to employ economic and informational tools to achieve its aims, while focusing on partnerships with state actors and striving to remain below the threshold of armed conflict. While this does not mean we can afford to disregard counterinsurgency entirely, as China is not our only competitor and could always adopt new stratagems, it does suggest a different set of defense priorities for countering China. To compete with China, what the United States armed forces need most are ways and means for integrated campaigning to further U.S. interests, which would allow them to counter Chinese actions below the threshold of armed conflict. We also certainly need capabilities for high-intensity combat, in case all else fails.

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Forbes: Is America’s Fossil Fuel Empire Collapsing?

The most ambitious clean energy project in history, Europe’s Green Deal marks the beginning of a new era in clean energy policy. Notwithstanding its challenges, Europe’s plan represents a “broad roadmap” for remaking its entire economy with the aim of creating the first climate-neutral region in the world by 2050. Underwritten by one trillion Euros in investment, the Green Deal calls for establishing the first-ever climate law anchored to the 2050 climate neutrality target. [...]

China is of course the world’s largest manufacturer and distributor of cleantech, but it is also the world’s largest carbon emitter. As the world’s manufacturing hub, China remains the largest producer of solar panels, wind turbines, batteries and electric vehicles, but it is also the top investor in clean energy. In addition to this, China is the world’s leader in renewable energy patents with the U.S., Japan, and Europe lagging behind. Together with China, the EU’s Green Deal could successfully remake the economy of Europe and much of Asia.

The larger significance of a green EU-China partnership is that it would provide the economies of scale and scope that the world desperately needs. Together, China and Europe could make it much cheaper for other regions in Asia, Africa, and Latin America to decarbonize. China is already globally dominant in renewables, electric vehicles (EV), energy storage, rail infrastructure, artificial intelligence (AI), telecommunications, and robotics. Even as the country’s rapidly expanding heft now rivals the United States, its massive capacity for cleantech production could effectively move the world beyond fossil fuels. [...]

At home, the United States faces the real possibility of social and political implosion. Its market-led society has given birth to a kind of corporate feudalism that has effectively nullified its democracy. As Jeffrey Sachs points out, each U.S. election cycle now costs $8 billion or more, and is routinely subverted by billionaires, Big Oil, the military-industrial complex, and the private health-care lobby. To put this in perspective, the richest four hundred Americans now have more wealth than 185 million of their fellow citizens.

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PolyMatter: Why Kazakhstan is Changing Alphabets

The Guardian: Why China fears sending the tanks into Hong Kong

The problem of open-ended civil unrest in Hong Kong, which has been punctuated by rising acts of violence and vandalism carried out by a distinct but hardline minority, is a reflection of China’s new assertiveness under Xi – an assertiveness that marks a break with the caution of the post-Mao era. It can be seen in Xi’s signature undertaking, the Belt and Road Initiative – an infrastructure building project with global ambitions. Or, most recently, the flaunting of new weapons systems during the military parade commemorating the 70th anniversary of Communist party rule – a declaration of China’s intention to rival American military power more openly than at any time in the recent past.[...]

This blocking of any path forward that would permit more self-determination under Chinese sovereignty – as promised when Britain handed Hong Kong back to the mainland in 1997 – has led to a marked radicalisation of Hong Kong’s population this year, and created a revolt of the middle class. The peaceful demonstrations that have regularly drawn hundreds of thousands of residents into the streets since the summer have included many older people, as well as plenty of residents from other segments of the population long assumed to be conservative or at least acquiescent, whether civil servants or business people. [...]

From here, Beijing’s choices in Hong Kong will not grow easier. The ultimate option, of course, is to mount a police or military intervention from the mainland in order to put down the protests. But at what cost? Hong Kong would lose forever its status as a global, cosmopolitan city, a goose that lays golden eggs for China. Since Deng Xiaoping introduced capitalism to China, Hong Kong has served as a critical business and investment portal for the country: a place where foreign companies feel it is safer for them to be based because of the independent judicial system and a banking structure that allows the free conversion of currencies and unlimited international transfers. As China has grown vastly richer it has become less dependent on Hong Kong for such purposes, but lots of investment into China still passes through the city.

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The Guardian: The European Union has bigger problems to deal with than Brexit

The EU’s biggest problem is that its economic model has aged alongside its population. Europe has plenty of world-class companies but, unlike the US, none of them were set up in the past 25 years. In Europe’s golden age, Volkswagen was a rival to Ford, and Siemens could go toe to toe with General Electric. But there is no European Google, Facebook or Amazon and in the emerging technologies of the fourth Industrial Revolution, such as artificial intelligence, Europe is nowhere. [...]

When plans for the euro were being drawn up 30 years ago, the assumption was that the single currency would make the single market work more efficiently and so generate faster growth. It hasn’t happened. The performance of the eurozone countries has got worse not better, but so much political capital has been invested in the monetary union project that there is an unwillingness to accept as much. [...]

Italy has tired of waiting for monetary union to deliver. Its banks are in even worse shape than Germany’s, Rome has no control over monetary policy and its attempts to boost growth by running a bigger budget deficit have fallen foul of Europe’s hardline fiscal rules. Last week, Italy’s government announced it would be the first EU country to take part in China’s Belt and Road initiative – an attempt to link Asia, the Middle East, Africa and Europe with a series of ports, railways, bridges and other infrastructure projects. Italy’s willingness to take part in the attempt to recreate the old silk road reflects its desperation to revive its economy by any means available. It also reflects Europe’s diminished status in the global pecking order.  

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The Guardian Longreads: Concrete: the most destructive material on Earth

He said the amount of concrete laid per square metre in Japan is 30 times the amount in America, and that the volume is almost exactly the same. “So we’re talking about a country the size of California laying the same amount of concrete [as the entire US]. Multiply America’s strip malls and urban sprawl by 30 to get a sense of what’s going on in Japan.” [...]

That is true of all countries at some stage. During their early stages of development, heavyweight construction projects are beneficial like a boxer putting on muscle. But for already mature economies, it is harmful like an aged athlete pumping ever stronger steroids to ever less effect. During the 1997-98 Asian financial crisis, Keynesian economic advisers told the Japanese government the best way to stimulate GDP growth was to dig a hole in the ground and fill it. Preferably with cement. The bigger the hole, the better. This meant profits and jobs. Of course, it is much easier to mobilise a nation to do something that improves people’s lives, but either way concrete is likely to be part of the arrangement. This was the thinking behind Roosevelt’s New Deal in the 1930s, which is celebrated in the US as a recession-busting national project but might also be described as the biggest ever concrete-pouring exercise up until that point. The Hoover Dam alone required 3.3m cubic metres, then a world record. Construction firms claimed it would outlast human civilisation. [...]

Empty, crumbling structures are not just an eyesore, but a drain on the economy and a waste of productive land. Ever greater construction requires ever more cement and steel factories, discharging ever more pollution and carbon dioxide. As the Chinese landscape architect Yu Kongjian has pointed out, it also suffocates the ecosystems – fertile soil, self-cleansing streams, storm-resisting mangrove swamps, flood-preventing forests – on which human beings ultimately depend. It is a threat to what he calls “eco-security”. [...]

Yu has been consulted by government officials, who are increasingly aware of the brittleness of the current Chinese model of growth. But their scope for movement is limited. The initial momentum of a concrete economy is always followed by inertia in concrete politics. The president has promised a shift of economic focus away from belching heavy industries and towards high-tech production in order to create a “beautiful country” and an “ecological civilisation”, and the government is now trying to wind down from the biggest construction boom in human history, but Xi cannot let the construction sector simply fade away, because it employs more than 55 million workers – almost the entire population of the UK. Instead, China is doing what countless other nations have done, exporting its environmental stress and excess capacity overseas. [...]

Although the dangers are increasingly apparent, this pattern continues to repeat itself. India and Indonesia are just entering their high-concrete phase of development. Over the next 40 years, the newly built floor area in the world is expected to double. Some of that will bring health benefits. The environmental scientist Vaclav Smil estimates the replacement of mud floors with concrete in the world’s poorest homes could cut parasitic diseases by nearly 80%. But each wheelbarrow of concrete also tips the world closer to ecological collapse.

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Jacobin Magazine: China’s Uyghur Repression

he emergence in Xinjiang of a new network of political reeducation camps has been a poorly kept secret for some time. But research and reporting is giving us hard evidence of the scale of this new policy. Since the middle of 2017, a major construction boom has thrown up a variety of detention centers and prisons whose inmates number in the hundreds of thousands. These camps combine many of the brute horrors of China’s earlier reeducation-through-labor system with the latest high-tech surveillance and monitoring mechanisms. [...]

More than at any point since its incorporation into the People’s Republic of China, Xinjiang today resembles occupied territory, and the party’s policies reveal an all-encompassing view of the Uyghurs as an internal enemy. The Uyghurs’ very presence in the land is an inconvenient reminder of Xinjiang’s alternative identity as the eastern fringe of the Islamic and Turkic-speaking world — one that Beijing would prefer to erase if it could. The party may not have any intention yet to physically remove the Uyghurs, but its efforts to marginalize the Uyghur language and rewrite the region’s history serve similar goals to a policy of ethnic cleansing. [...]

In the wake of 9/11, China refashioned its hard-line campaign against separatism into a wing of the global “war on terror,” and in doing so reached something of an accommodation with Washington. There have been sporadic acts of terrorist violence in Xinjiang and elsewhere in China, some of which, tragically, have cost the lives of ordinary Han Chinese. But Uyghur resistance in Xinjiang is much more disorganized and demilitarized than China would like us to believe. China’s war on terror has claimed as its victims even mildly dissenting party members such as economics professor Ilham Tohti, who was given a lifelong prison sentence four years ago for criticizing the marginalization of Uyghurs in Xinjiang. [...]

There’s no point talking about holding China to international norms when those norms don’t exist. If anything, Islamophobic bigotry has become the norm around the world, and with it a variety of intrusive and punitive de-radicalization programs similar in conception, if not scale, to China’s. Reading Jim Wolfreys’s recent book on France, it’s not hard to see similarities with the measures being implemented in Xinjiang: bans on forms of veiling, citizens encouraged to look out for signs of radicalization as innocuous as someone changing their eating habits. In 2015, Socialist Prime Minister Manuel Valls went so far as to consult on the constitutionality of creating detention centers for more than ten thousand people on a police watch list of suspected extremists.

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Jacobin Magazine: China’s One-Man Show

This has a number of knock-on effects. If you know that you have to step down at the end of ten years, you moderate your behavior. You don’t want to have a whole set of enemies waiting to get you. So, the tenor and tone of the administrations that followed Deng Xiaoping were altogether calmer than during the era of Mao Zedong.

Term limits also solved the question that has bedeviled China’s politics, which is the question of succession. All through the imperial period — 2,000 years of naked power struggles and succession struggles — you see the bad effects of not having a constitutional succession process. And we saw it also in the first years of Chairman Mao, when every person who was named number two, and therefore could be expected to succeed Mao, ended up either dead or in jail. [...]

There are a couple of possible explanations for that. One, it dovetails very well with an international role. As president, he gets to interact with other presidents, whereas as general secretary it’s a little more complicated to meet Queen Elizabeth or a US president. [...]

It’s not really clear how the state is going to deal with that going forward. There have been some measures to clean up what they call gray banking and shadow banking sectors, where financial instruments of the kind that caused so much trouble in the Western financial system were devised by local authorities and by state-owned enterprises in order to go on fueling their growth. You can’t run like that forever, and that is one of the problems that Xi Jinping is going to have to address. [...]

I think the ultimate vision is a restoration of the sense that China is the center of its world. That was the way China felt about itself for many centuries, partly because it didn’t really go very much farther. There was a brief period in the Ming Dynasty when ships went up and down the coast of Africa, and there was always land-based trade along the Silk Road, but China was content to treat the states and its neighbors in the immediate region as tributaries that paid homage to China as the great regional power. It was 20 percent of the world’s economy, which is pretty much where we’re heading back to.

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Quartz: What China’s Xi Jinping wants with all that power

Xi often speaks of the importance of the “rejuvenation” of the Chinese nation, and of the ambitious and tricky tasks the country must navigate over the next 15 or so years: become more uniformly prosperous, repair the environment, and turn China into the world’s biggest power. To do all that, Xi believes that the party must be at the center of everything, and he himself at the center of the party. [...]

After Mao’s death in 1976, Deng Xiaoping, who had been a political target, returned to the inner circle of the party, and soon maneuvered his way into becoming its most powerful leader. He quickly decided to introduce collective leadership—highlighted, among other things, by a power-transfer mechanism—to prevent the rise of another Mao-like personality cult. In a new constitution ratified in 1982, the presidency was restored with a two-term, 10-year limit. A retirement rule for Chinese officeholders was put in place for the first time, and China was set apart from other authoritarian regimes by having a process for orderly leadership succession. [...]

Xi, who spearheaded a dramatic crackdown on corruption and dissent, as well as a slew of legal reforms under the rhetoric of “rule of law,” may not want to do things that way. “It might be that he has less faith in the efficacy of informal power versus more formal institutional power, and that might be a lesson he learned from Deng’s experience,” Sam Crane, a Chinese politics expert at Williams College in Massachusetts, told Quartz.  [...]

Xi’s move “makes sense with how he views both Gorbachev’s and [his predecessor] Hu’s [Jintao] governance failures—basically that they allowed the state to strengthen at the expense of the Party, straining the linkage between the two and allowing for the existence of a state without a Party,” wrote Jessica Teets, a political scientist at Middlebury College in Vermont.  

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New Statesman: The new age of great power politics

Two of the nations that had evangelised most about the liberal international order, the United States and the United Kingdom, seemed to lose their faith in its durability (and perhaps even its desirability). Even many of those who continued to value the citadel that had been built after 1945 believed that it was time to raise the draw-bridge, fill the moat and man the ramparts. Citizens of nowhere – a phrase that Huntington adapted from Adam Smith’s The Wealth of Nations before Theresa May’s speechwriters got their hands on it – had their notice served. Absent the US as its guarantor, what would this mean for the rules-based international system that was supposed to be the great offering of the post-Cold War Western Belle Époque? [...]

There is an ugly reality about the emerging new world order but it is a reality that must be confronted, nonetheless. As president, Trump has proved to be even more ogreish than he appeared on the campaign trail, notwithstanding the mild softening of tone in the recent State of the Union address. So many taboos and conventions have been broken (he recently traduced Britain’s NHS) that it is far from inevitable that future aspirants for high office will try to raise the bar back up again, as opposed to muddying themselves in an effort to squirm under it. [...]

Twelve months after Trump’s inauguration, it is fair to ask a broader question: what, in material terms, has changed in global politics in the first year of his presidency? The answer is that the world does not revolve around Trump, but he does embody a profound shift in the atmosphere. There is a sharpening of elbows (and, in some cases, knives) in many of the world’s most powerful capitals, with implications for prosperity and security. An age of relative equipoise between the world’s major powers is ebbing away into an era in which inter-state competition will be more nakedly pursued. [...]

It was only in the post-Cold War era, when Britain’s foremost ally emerged triumphant and seemingly unrivalled, that national defence spending dropped from an average of 3 per cent of GDP. In a world where Britain will have more difficulty in keeping its voice heard, it is time to revisit this question. When May made a point of stressing Britain’s role in European defence at the outset of the Brexit negotiations, it was widely condemned as a crude tactic. In other parts of the world, it is regarded as less uncouth to talk about such ugly realities. In Asia, in particular, where Western nations are now clambering for advantage, the relationship between trade and security is seen more explicitly in terms of a quid pro quo. As the UK government has sought to lay the ground for enhanced post-Brexit trading relations “East of Suez” – with Australia, Japan, South Korea, and others – these conversations have all been tied to closer collaboration on security and defence.

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The Washington Post: Putin’s Silk Road gamble

Another blow was the loss of Ukraine as a potential participant in Russian-led integration arrangements. Without Ukraine, the second-largest post-Soviet economy and a market of about 44 million people, Moscow’s hopes to create an integrated bloc that would be on par with the European Union and other centers of global economic power were essentially dashed. Lacking a market of sufficient size to create its own viable geo-economic area, Russia was left with the only option of moving into another nation’s economic orbit. [...]

Still, while praising the Belt and Road plan, Moscow is keen to prevent Beijing’s geopolitical domination of continental Eurasia. Instead of wholeheartedly subscribing to China’s scheme, the Kremlin promotes its own vision of “a larger Eurasian partnership” or “Greater Eurasia,” a network of existing and emerging “integration formats.” Beijing’s Belt and Road would be just one element, alongside the Eurasian Economic Union, the Shanghai Cooperation Organization, the Association of Southeast Asian Nations and potentially even the European Union. [...]

Russia aspires to be the main security and diplomatic broker in Eurasia while leaving China with the role of the economic leader. As one observer put it, “China would be the bank, and Russia would be the big gun.” Such an arrangement might harken back to the history of the European Community, when France acted as the political leader while West Germany was the economic engine. Moscow’s preference for a new Eurasian order is reflected in its diplomatic activism, such as its leading role in securing the admission of India and Pakistan into the Shanghai Cooperation Organization and in advocacy for the future membership of Iran.

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Politico: China’s meddling poses greater threat to EU than Kremlin, says study

“While Beijing’s efforts have received much less scrutiny than the efforts of Putin’s Russia, Europe neglects China’s increasing influence at its own peril,” the report warns. “Beijing’s political influencing efforts in Europe are bound to be much more consequential in the medium to long-term future than those of the Kremlin.”

Beijing’s growing influence is dangerous for Europe, the report warns, because “China’s political model is based on an authoritarian regime intent on strengthening a deeply illiberal surveillance state at home while also exporting — or at least trying to popularize — its political and economic development model abroad.” [...]

The authors cite former British Prime Minister David Cameron’s new job at a Chinese state-backed investment fund and former British Prime Minister Gordon Brown’s role as chief adviser to the China-CEE Fund, which invests in Eastern European countries, as recent examples of China’s strategy to influence Britain’s highest political circles. Brown “has also been actively organizing conferences promoting China’s [Belt and Road Initiative, an investment plan] at his alma mater, the University of Edinburgh,” they write.

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The Atlantic: Tillerson to Latin America: Beware of China

China’s trade with and investment in the region deepened at around the time of the great recession of 2008. Between 2015 and 2019, it plans to invest $250 billion in direct investment in the region and about $500 billion in trade. It’s well on its way: China is already the largest trading partner of Argentina, Brazil, Chile, and Peru.

As I’ve previously written, countries in Africa, Asia, and Latin America have a hard time securing international financing because of poor governance, corruption, and their economic policies. But China goes to them, builds desperately needed roads, railways, and ports, and uses these new facilities to transport raw material to feed its growing economy and population. China is an attractive investor not only because it has a policy of non-interference in the domestic affairs of its partner countries but because its projects are completed at a speed that developing nations are unused to. More importantly, perhaps, it offers to finance these projects on easy terms. But there’s always a catch, Tillerson said Thursday at the University of Texas, his alma mater. [...]

“China is experimenting with market-based solutions, and moving incrementally in its international economic efforts, much as it did during its domestic development,” he wrote. “Its approach to global economic affairs appears to be more pragmatic than ideological—and may be more likely to defend than upend the liberal economic order.”

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Al Jazeera: After a year of elections, Nepal moves closer to China

Presumptive prime minister and UML chieftain Khadga Prasad Sharma Oli began his political career as a Maoist in the early 1970s in Jhapa across the border with India's West Bengal state. Those were the days of slogans like "China's Chairman is Our Chairman and China's Path is Our Path" rending the air in West Bengal. But Oli embraced revisionism early on and by 1990s he had begun to reclaim hyper-nationalist rhetoric. He is known better for his demagoguery than democratic convictions. [...]

Along with Pakistan and Sri Lanka, Nepal rushed to join One Belt One Road (OBOR) initiative, which aims to invest in infrastructural projects as a part of President Xi's peripheral diplomacy doctrine with China at its centre. The lapsed Maoist duo of Oli and Prachand expects to attract enough Chinese money to build trans-Himalayan railways, hydroelectric projects modelled after the Three Gorges dam and make the entire economy of Nepal look northwards for sustenance. [...]

Over one-third of the Nepalese economy is based on remittances from unskilled and low-skilled labourers sweating out in volatile countries. Sovereign guarantees of an externally dependent economy may not have anything more than geopolitical significance. That is likely to put a spanner in the grandiose plans of the Left Alliance if India decides to protect its traditional sphere of influence. [...]

Unless the Chinese decide to do to Nepal what the Soviets did for Cuba or the Americans for West Germany during the Cold War, Indian ports will continue to be the lifeline of the Nepalese economy. Religious, cultural, linguistic and social affinities between India and Nepal mean that a large number of poor Nepalese look towards India for permanent or seasonal employment. New Delhi is unlikely to loosen its grip in its backyard without some resistance. [...]

The much-vaunted Peace Process that brought Maoists into mainstream politics in 2006 is also far from complete. The Truth and Reconciliation Commission hasn't yet completed its task of bringing perpetrators and victims of the decade-long armed conflict together. The Commission of Investigation on Enforced Disappeared Persons has not been able to ascertain the whereabouts of victims or identify the guilty. Without a sense of closure, wounds of the armed conflict would continue to fester.

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Quartz: Why does India want to buy the world’s emptiest airport?

When the bills became due, the government couldn’t repay them. Sri Lanka, now minus Mahinda Rajapaksa, was forced to go to its Chinese backers cap in hand—essentially to hand over ownership of the port in a debt-for-equity swap. Although Sri Lanka claims to have retained control over management of the port, the details are suspiciously murky. China now has plans to build a big Special Economic Zone around Hambantota. This may eventually drive some demand for shipping, but it is hard to see it ever becoming the global shipping hub it was once touted to be. [...]

Similar claims are being made about the China-Pakistan Economic Corridor now being constructed in Pakistan at a cost of somewhere like US$40 billion-$100 billion, with some fearing it will create a “debt trap” for Pakistan. [...]

This is where the world’s emptiest airport comes in. India is proposing to spend around US$300 million to buy out Sri Lanka’s debt to China in return for a 40-year lease over Hambantota airport. But India’s future plans for the airport are hazy. Maybe a flight school? A new destination for Indian weddings? There seems little chance that it will turn a profit.

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The Atlantic: 'It's a Mistake to Underestimate China'

But there are few signs that Washington has the political appetite to compete with the kinds of investments China has been making around the world. The most visible aspect of Beijing’s ambition to extend its economic and political influence around the world is the Belt and Road initiative, a massive infrastructure plan that aims to connect China to its Asian neighbors and farther afield. Think of it as a hub-and-spoke model: China, the hub, builds infrastructure in countries around the world, the spokes, in order to facilitate trade. China is building roads, bridges, seaports, and airports in more than 60 countries to facilitate the import of raw material in order to further fuel its own economic growth while it searches for new markets. Unlike the West, China offers cheap loans, doesn’t ask questions about human rights or the environment, and doesn’t export its political ideology. [...]

To be sure, there are challenges to China’s ambition. For one thing, the market logic underpinning some Belt and Road projects is questionable. One example: China’s investment in a Sri Lankan port didn’t get the traffic or cargo it had expected, saddling the Sri Lankan government with massive debt that it had trouble paying off. For another, the reaction to Belt and Road-funded projects isn’t always positive. Vietnam and Burma are good examples. In those countries, China is accused of importing workers, degrading the environment, building shoddy infrastructure, and eroding sovereignty. Meanwhile, regional rivals like India, Japan, and Russia, which fears China’s influence in Central Asia, are wary of Belt and Road. [...]

But, ultimately, Kilman pointed out, “none of these challenges are insurmountable” for China. Indeed, if Beijing has shown one thing, it’s the ability to learn from its mistakes. For instance, while some of its projects may be white elephants, such as the one in Sri Lanka, they serve an important geopolitical goal; following complaints and protests in other countries, China has built local capacity and provided jobs. “Not all of what China is doing is market-driven, but there are infrastructure needs in the Indian Ocean area,” Kliman said. China is meeting those needs.  

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The Atlantic: China vs. America in a Financial Game of 'Risk'

For China, Hambantota offered an important port that would bring raw material, such as minerals and metals from Africa and oil from the Middle East, via the Indian Ocean to China’s own ports. For Sri Lanka, whose economy is still struggling to recover from a devastating decades-long civil war, not to mention the impact of the 2004 Indian Ocean tsunami, the Chinese money offered an important financial lifeline—until it didn’t. The port didn’t get the traffic it had hoped for, didn’t get the cargo that was expected, and didn’t create the jobs that were promised. Sri Lanka still had to repay its loans, though—and not just to China. Almost all of the revenue that Sri Lanka's government generates goes toward servicing its massive debt. The only solution that Sri Lanka could come up with was to lease the port back to China for 99 years and repay China with money from the lease. [...]

China views its actions through its own national-security prism. It goes to countries in Africa, Asia, and Latin America that have a hard time securing international financing; offers them easy terms; builds desperately needed roads, railways, and ports; and uses the newly built facilities to transport raw material to feed its growing economy and population. There are advantages from the perspectives of both China and the countries receiving the loans. For one thing, Brad Parks, executive director of AidData, said in an email that factors that make China an attractive investor include its “policy of non-interference in the domestic affairs of its partner countries.” [...]

But the U.S. and its allies in the region, primarily India and Japan, worry that projects like Hambantota in Sri Lanka and the seemingly easy terms of China’s loans put regional economies at a distinct disadvantage—not to mention putting the U.S. and its allies at a strategic disadvantage. Speaking Wednesday at the Center for Strategic and International Studies in Washington, Rex Tillerson, the U.S. secretary of state, warned that the Indo-Pacific region could fall victim to China’s “predatory economics.” He said China’s actions “result in saddling them [the countries in the region] with enormous amounts of debt.”

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