TCS Daily


The SCO and China's Reach

By Rowan Callick - June 16, 2006 12:00 AM

The recent annual meeting of the once obscure Shanghai Cooperation Organization (SCO) illustrates how rapidly China's global influence is growing.

The group's members and observers, who include half the world's population, signaled at their summit in Shanghai on June 15-16, their determination to play a central role in international energy politics. Russia's President Vladimir Putin urged the formation of "an SCO energy club" -- for it involves some of the biggest energy exporters and importers.

The presidents of the members -- China, Russia, Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan -- also moved to develop the organization into a powerful military and economic force.

The observers included Iran's controversial President Mahmud Ahmadinejad, who formally invited the energy ministers of the SCO to meet in Iran "to explore more effective ways of cooperating in the exploration, exploitation, transport and conversion of energy." The invitation is likely to be taken up, not least because Iran has become the third biggest supplier of oil to China.

India, an SCO observer like Iran, Pakistan and Mongolia, has recently been a major competitor with China for energy. It indicated a change in tack by sending its Petroleum and Gas Minister Murli Deora to the summit, and has decided to join China in bidding $US 2 billion together to develop oilfields in SCO member Kazakhstan.

The Association of South East Asian Nations sent to the Shanghai summit its deputy secretary general, Wilfrido Villacorta, who spoke warmly of the relationship between China and ASEAN -- which was established 30 years ago in defense against communist, chiefly Chinese, incursions. Together, they have initiated the annual East Asia Summit, which excludes the US.

China is starting to dominate East and Southeast Asia. That is a theme of two important new pieces of research to come out of Australia: "ASEAN and East Asian International Relations" by David Martin Jones of Queensland University and Michael Smith of King's College London (published by Edward Elgar), and "The Paramount Power," a paper by former Australian diplomat and academic Milton Osborne for the Lowy Institute.

Martin Jones and Smith say that China is seeking "to re-establish an area of regional influence in the 'Nanyang' -- the southern ocean -- while guarding against separatist Islamic forces and pressure to democratize both from within and without, which impels it towards new authoritarian and anti-Islamic groupings like the Shanghai Cooperation Organisation."

Osborne says: "China has now assumed a position as the paramount regional power." China's "charm offensive," he says, gathered impetus after the end of the Cold War, and accelerated through the Asian financial crisis from 1997, which "gave it the opportunity to demonstrate its goodwill towards the south east Asian region," participating in major loans and refusing to devalue the yuan, thus seeming to stem the tide of currency collapses.

He says that "China's economic development, once seen as a threat by south east Asia, is now generally regarded as an opportunity," reflected in the substantial trade increase reinforced by a framework agreement on free trade with the ten members of ASEAN to come into full effect in 2010. China has trade deficits with many of those countries, which supply industrial parts it assembles.

On June 17, Premier Wen Jiabao set off for Egypt, Ghana, the Republic of Congo, Angola, South Africa, Tanzania and Uganda. After visiting the USA in April, President Hu Jintao went on to Saudi Arabia, Morocco, Nigeria and Kenya -- a trip as important for Chinese interests as the more awkward stay in America, with trade with Africa soaring to $US 40 billion last year.

China has become determined, as it rapidly emerges as a great economic power, to ensure it boxes its weight on the international stage -- unlike its rival Japan.

When the Berlin Wall fell and the Cold War ended, Washington felt confident that the Pax Americana would swiftly become irreplaceable, that countries that courted prosperity must accommodate themselves to American values. The rise of Islamist terror is the factor that has most famously dented that confidence.

But a trend that is quietly having a bigger impact on greater areas of the globe is the rise of China -- which is also offering prosperity, but is making few other demands beyond access to resources and the One China oath of loyalty.

Hu remains little known in the West. But since becoming Vice President five years ago, and then taking the top job -- leadership of the communist party -- two years later, his face has become familiar in the world beyond the West.

He has visited in this time Iran, Syria, Jordan, Cyprus, Malaysia, Singapore, Russia, Kazakhstan, Mongolia, Thailand, Egypt, Gabon, Algeria, Poland, Hungary, Rumania, Uzbekistan, Brazil, Argentina, Chile, Cuba, Brunei, Indonesia, the Philippines, Mexico, Vietnam, and both North and South Korea, as well as in April Saudi Arabia, Morocco, Nigeria and Kenya.

China's leaders have in recent years visited Latin America more frequently than have US leaders, and China is now the second-biggest trading partner, after the US, of most of the continent. Mexico's leading academic on China, Romer Cornejo of the Colegio de Mexico, says the region is now listening more attentively to what China's leaders are saying because "they have a long-term plan for Latin America" -- including buying a bigger share of the commodities that traditionally go to the US.

Quietly, China has also been building an engineering, construction and transport empire in the developing world. It has become the sixth largest engineering contractor, with new contracts up 24 per cent in 2005 to $US 29 billion.

In previous decades, China invoked Maoist ideology to champion what it viewed as downtrodden developing countries. Such rhetoric, such interest, was on the whole received politely but in a lukewarm way in the developing world. The big difference today, is that China is perceived to be rich. It wants to buy the developing world's commodities, and has the capacity to offer the rulers attractive rewards.

China's popularity with Third World leaders hinges in part on its toleration of the behavior of its partners. Pol Pot set the pace, and since then no act appears to push any of its friends beyond the pale. Furthermore, the ideologically commendable, penurious old uncle has become the rich, friendly uncle.

Thus, regimes like that of Uzbekistan's feared President Islam Karimov, or of Zimbabwe's Robert Mugabe, or of the Sudan, or of the generals who control Burma, are no longer frozen out of international contact.

As long as their control is credible, they can be sure of a welcome in Beijing -- which has itself effectively opted against meaningful political reform, in part because of the praise showered by international business on the party's leaders for China's economic success.

Rowan Callick is the Beijing based China correspondent of The Australian newspaper.

Categories:
|

TCS Daily Archives