April 23, 2008

Don't Boycott the Olympics

For the last several weeks, I have struggled with the real issue of whether nations and their leaders should boycott the Chinese Olympics over a wide range of issues from Darfur , Tibet, Burma, to internal human rights. All these crises involving great human suffering and sacrifice demand our attention. These are issues about which I feel passionately. Clearly we must make a powerful statement to the Chinese expressing our outrage over their policies. Olympics

At first blush, the Olympics offer a great opportunity to make such a statement. The Chinese government and its people have invested their national pride in this prestigious event. What better way to show them how we feel. However, as I have read more and dug deeper into the issue, it becomes much more complex

First - upon reflection, I have come to believe it is essential in this time of turmoil, war, famine and anger to have at least one place where the people of the nations of the world can meet in peace and friendship. Seeing all the nations march together into the arena in the opening ceremonies is still a powerful experience of coming together. Lord knows we have ample opportunity to express our outrage and concerns between Olympics.

Second - it is exactly because the Chinese have invested so much of their national pride in the Olympics that it would be huge mistake to boycott them. No one can argue that China hasn't become a major player on the international scene. Their 'resource diplomacy' has made their presence known in most of the Southern Hemisphere. America still has time to find common ground with the Chinese and avoid a new 'cold war' in the Far East. Our strategic interests far outweigh the minimum benefits garnered through a boycott. Fareed Zakaria in Newsweek wrote:

"In these circumstances, a boycott of the Olympics would have precisely the opposite effect that is intended. The regime in Beijing would become only more defensive and stubborn. The Chinese people would rally around the flag and see the West as trying to humiliate China in its first international moment of glory. (There are many suspicions that the United States cannot abide the prospect of a rising China.) For most Chinese, the Games are about the world's giving China respect, rather than bolstering the Communist Party's legitimacy.

For leaders to boycott the Games' opening ceremonies alone is an odd idea. Is the president of the United States supposed to travel to Beijing to attend the women's water-polo finals instead? (Britain's Gordon Brown, for instance, has said he'll attend the closing, but not the opening ceremonies.) Picking who will go to which event is trying to have it both ways, voting for the boycott before you vote against it. Some want to punish China for its association with the Sudanese government, which is perpetrating atrocities in Darfur. But to boycott Beijing's Games because it buys oil from Sudan carries the notion of responsibility too far. After all, the United States has much closer ties to Saudi Arabia, a medieval monarchy that has funded Islamic terror. Should the world boycott America for this relationship?"

He ended his commentary by saying:

In fact, in almost all cases—Turkey, India—granting autonomy to groups that press for it has in the end produced a more stable and peaceful national climate. But that is a lesson the Chinese government will have to learn for itself; it is unlikely to take instruction from outsiders. Its handling of the protests in Tibet is disgraceful. But humiliating the entire country over it would make matters worse.

In the end, because of the need for a peaceful gathering place and our future ability to affect the course of our relations with China, it is important that we show up in Beijing. Now is not the time for symbolic actions that yield little but fleeting self-satisfaction. Indeed, such an action could possibly do long term harm to the peace and security of the world

April 20, 2008

Congo: China's "Resource Diplomacy" - The Biggest Deal

Nothing but bad news has been coming out of the Congo for years and years. Their civil war has claimed over four million lives and much of the country lies in ruins. Since the days of King Leopold of Belgium, this resource-rich nation has rarely seen good news. For decades and decades, colonial powers and tinhorn dictators have raped this country. Now even with the effects of their devastating civil war, there just might be good news for the Congo but bad news for U.S. policy makers.Congo 

The People's Republic of China is about to sign a pact with the Congo that will be one of the biggest deals in Africa to be negotiated with any major power today. With no questions asked about the internal politics and human rights issues within the Congo, the deal, worth $9 billion dollars, could possibly be the light at the end of the tunnel. BBC News outlines the scope of this major treaty:

"And the new road they're planning will be the first fruit of the biggest single deal China's ever done in Africa, worth $9bn.

Due to be signed in Beijing in the next few days, it gives DR Congo $6bn of desperately needed infrastructure - about 2,400 miles of road, 2,000 miles of railway, 32 hospitals, 145 health centres and two universities.

In return, China gets a slice of DR Congo's precious natural resources to feed its booming industries - 10m tonnes of copper and 400,000 tonnes of cobalt. "

To put this in context, the $6 billion for the Congo is four times its annual budget! At the moment, this is almost one small barely functioning rail line in the country. China loves to call these treaties "win-win" diplomacy where they win with access to precious resources and the Congo wins with amazing improvement to their infrastructure. For years, the Congo has seen its resources depleted in a series of badly negotiated deals with global companies -- and almost all of the money has invariably ended up going into the hands of corrupt officials.

As unique as this deal will be for Africa and for the Congo, it is important to remember that China 'wins' significantly more than the Congo. Some analysts speculate that by the time China extracts all the copper and cobalt, they will have an overall profit of $42 billion dollars. In addition, there are zero details on human rights and labor questions involved in the building of the infrastructure. Without too much trouble, this promising plan could quickly turn into just another colonial power putting down its roots in Africa.

A lot remains to be seen if this will, in the end, be a significant breakthrough for the Congo. Yet, given their past, it is at least a new way that offers some semblance hope for them.

The pact also reminds Americans of their lack of policy in Africa and while we are bogged down in Iraq, China is, with great alacrity, tying up resources around the world with their brand of 'resource diplomacy'. Americans might soon wake up to a real shortage of key minerals, materials, etc because we have been out-negotiated, out-maneuvered and out-smarted by the Chinese.

There is an amazing 19 minute video on BBC news from the Congo on this effort. If you have the time, take a look and learn. Just click here.

March 25, 2008

China: Resource Diplomacy

No matter what corner of the world into which you peek, you will find the Chinese building, extracting, processing and smelting! You can look to Angola and find a cross-country rail line being built in exchange for oil or to Bolivia for gas deals or to Australia for coal purchases or to energy deals in Kazakhstan. The Chinese have embarked upon a global effort to corner the markets in fuels, metals, raw materials and grains. Giving new definition to the term 'resource diplomacy', China's desperate desire to have access to raw materials in order to continue its amazing growth affects every nation on the globe. Mapofchina

While the United States' foreign policy has become frozen and paralyzed by our 'war on terror' epitomized by our disaster in Iraq, the Chinese have increasingly spread across the global terrain in a 'no questions asked' foreign policy and reached major deal after major deal concerning vital raw goods. Our nation could soon wake up from the nightmare of President Bush's tragically myopic vision of the world to find that we have been cut off from not only needed goods but needed friends.

In a 'must read' special report in The Economist called "The New Colonialists", the magazine devotes fourteen pages to this critical issue. As the report states, "China with about a fifth of the world's population, now consumes half of its cement, a third of its steel and over a quarter of its aluminum." The impact - not only on China's horrendous environment but also the world's - is major. The cornering of the world markets could lead to major international tension in the near future. The carefully carried out 'resource diplomacy' could leave both the European Union and the United States more isolated in the Southern Hemisphere than ever.

Here is an important excerpt from the remarkable special report in The Economist. Take time to read the entire fourteen pages. You will not regret it.

"China's hunger for natural resources has set off a global commodity boom. Developed countries worry about being left high and dry, but the biggest effects will be felt in China itself, says Edward McBride

Beside the railroad track, between two hillocks of rust-red soil in the midst of Congo's mining belt, three Chinese laborers appear as if from nowhere. There are lots of Chinese around these days, explains one of their compatriots, Harvey Lee, who is driving through the scrub to the nearby copper plant he runs for a Canadian metals firm. On his way, he points out several rudimentary smelters. “That one”, he says, waving at a clump of corrugated-iron sheds and belching chimneys, “is owned by a man from Shanghai.” Moments later, when another ramshackle compound comes into view, he adds, “and that one belongs to two ladies from Hong Kong.” In all, he reckons, Chinese entrepreneurs have set up half of Lubumbashi's 50-odd processing plants.

All around Lubumbashi, the capital of Congo's copper-rich province of Katanga, there are signs of a sudden Chinese invasion. Chinese middlemen have begun buying ore from the area's many wildcat miners and selling it on to processing plants like Mr Lee's. Locals point out several villas in the city's leafy colonial cantonment that are occupied by mysterious Chinese businessmen. Katanga Fried Chicken, hitherto Lubumbashi's most popular restaurant, now has three busy Chinese competitors.

If all goes according to plan, these fledgling businesses will soon be overshadowed by Chinese investment on a much grander scale. In late 2007 the Congolese government announced that Chinese state-owned firms would build or refurbish various railways, roads and mines around the country at a cost of $12 billion, in exchange for the right to mine copper ore of an equivalent value. That sum is more than three times Congo's annual national budget and roughly ten times the aid that the “consultative group” of Western donors has promised the country each year until 2010. The Chinese authorities, it seems, are so anxious to obtain enough minerals to sustain their country's remarkable economic growth that they are willing to invest billions in a dirt-poor and war-torn place like Congo—billions more, in fact, than Western governments and investors combined are putting in.

And Congo is not the only beneficiary of China's hunger for natural resources. From Canada to Indonesia to Kazakhstan, Chinese firms are gobbling up oil, gas, coal and metals, or paying for the right to explore for them, or buying up firms that produce them. Ships are queuing off Australia's biggest coal port, Newcastle, to load cargoes destined for China; at one point last June the line was 79 ships long. African and Latin American economies are growing at their fastest pace in decades, thanks in large part to heavy Chinese demand for their resources."