Chinese Military,Political and Social Superthread

[GAP]

Harper’s mission
Article Link
Lawrence Solomon  Feb 3, 2012

He is the only PM in memory who has shown any spine in his dealings with China’s brutal plunderers

When Canadian Prime Minister Stephen Harper meets China’s President Hu Jintao in Beijing next week, it will be a meeting between a growing, newly confident power and one that is unsure of itself and its place in the world. Harper heads the confident power. Hu stands atop a vast chaos, a seething, heaving economy of plunderers that keeps the plundered at bay through an army of spies and thugs, of thieves that pirate the West’s designs and innovations, and of military adventurers who threaten to seize property and resources from nearly all its neighbours.

In aid of its territorial claims against its neighbours, China’s military – the world’s largest after the U.S.— has been growing rapidly and, most believe, surreptitiously — some estimates, such as from the Stockholm International Peace Research Institute, have had China underreporting military spending by a factor of five. Under this onslaught, Vietnam fears for its Spratly Islands, Japan for the Senkaku Islands, Taiwan for itself.

As remarkably, China’s official accounts show it to spend even more keeping its citizens in check — it calls this “social stability maintenance” — than on its military. Spending on social stability, which includes police, jails, and an elaborate domestic surveillance system that tracks citizens, has been increasing at a blistering rate – almost 14% in the current year. As with military spending, many believe the Chinese government is understating these expenses, too, to hide the shame of needing to crack down on a populace that holds it in contempt, that increasingly mocks its ham-handed stupidity, and that increasingly confronts it.

The number of protests against injustices has been steadily climbing. In 1993, according to the Chinese Police Academy, China experienced 8,700 “mass incidents.” By 2006, that figure had soared to more than 90,000 and in 2010, according to an estimate from Tsinghua University, it doubled to 180,000. The great majority of the protests are not political but economic, typically by communities protesting against the confiscation of their land by developers in league with corrupt government officials.
To defuse this powder keg, the government sometimes attacks, sometimes appeases, sometimes both. In one high profile protest last September, thousands of villagers in the southern community of Wukan demonstrated against the seizure of their farmland, leading to attacks by riot police, a counterattack by villagers, and a government siege of the village designed to starve the village into submission. After withering foreign coverage (but almost none in China’s official media), the government finally caved, agreeing to fire the corrupt officials and suspend the land seizures pending an investigation. The village of Wukan this week even conducted fair and free local elections, thought to be a first in today’s China.

But the appeasement of Wukan is very much the exception. China is today more repressive than at any time since the Tiananmen crackdown in 1989. Critics are being increasingly detained, beaten, or jailed for crimes such as “inciting subversion of state power” after writing essays on constitutional democracy.

“Disappearances” of dissidents are not only on the rise in China, the government’s draft criminal code is effectively legalizing them, raising fears that disappearances will become a common feature in the China of tomorrow. Chinese government caseworkers, in an odd mix of bureaucracy and brutality, advise their dissident “clients” on the liberties they may exercise (such as speaking to the press or writing an article), when they may exercise their liberties, and the merits of leaving their homes for extended periods of time, for either an exile in the countryside or outside China altogether.

What does Harper want with this government, about which he cannot have any illusions — he is, after all, the only Canadian prime minister in memory who has shown spine in his dealings with China. Harper travels not as a supplicant, as did former Prime Minister Jean Chrétien and his Team Canada of businessmen, but from a position of power, the leader of a country whose resources China, among others, covets. The itinerary for the Harper trip mostly reads like a goodwill foray — signing of “co-operation agreements,” a visit to the panda zoo, sealskin attire to promote Newfoundland jobs and other made-for-photo-op occasions. Harper hopes the Chinese will formally agree not to plunder Canadians who invest in China but he must know that China signs such agreements easily, and then fails to enforce them.

The takeaways from Harper’s trip to China — apart from the pandas that will soon visit Canada — have little to do with China proper. By promoting seal products, Harper will show Newfoundlanders he is standing up for their culture. By being respectful to China, Harper will please the large and chauvinistic Chinese-Canadian community. Mostly, however, Harper is going to China to impress upon the U.S. the danger of taking Canada for granted.
More on link

That last highlighted sentence says far more than all the statistics in the world.....Harper can play the game just as well an any out there..................

 

[Edward Campbell]

There is a whole lot more than just impressing upon the U.S. the danger of taking Canada for granted.

Even as we put the finishing touches on a free trade deal with the EU, Prime Minister Harper is steering us, as The Ruxted Group advocated, in a new direction: extending our (stronger) right hand towards Asia. It is an appropriate 21st century policy.

China is not the only target ~ we need to extend that right hand of friendship and trade all of Asia, including Islamic Asia, Indonesia and Malaysia especially, in order to offset the baleful influence of the Arabs.

 

[a_majoor]

Of course plan "C" is to continue building the PLA and PLAN to the point they can do force projection:

http://the-diplomat.com/2012/02/08/china%E2%80%99s-achilles%E2%80%99-heel/?all=true

China’s Achilles’ Heel
February 08, 2012
By Minxin Pei   

With little in the way of force projection, China’s dependence on natural resources in unstable parts of the world could undercut its economic ambitions. There are limits to freeriding.
 
The seizure of 29 Chinese workers by Sudanese rebels in the southern part of Sudan last week exposed one of the most vulnerable links in China’s ambitious plan for extending its economic influence abroad. To be sure, this isn’t the first time workers sent by China to dangerous regions were kidnapped or harmed. Five years ago, three Chinese engineers were murdered by a militant group in Pakistan. When civil war broke out in Libya nearly a year ago, Beijing had to dispatch a fleet of ships and airplanes to evacuate more than 30,000 Chinese workers from the country.

Despite the release of the workers this week, such incidents – and there will be many similar ones in the future – raise several important questions about China’s strategy of “going out” in general, and its quest for natural resources in particular.

The motivations for Beijing to expand its economic reach across the globe are easy to understand. The Chinese economy is resource-intensive and depends on secure access to energy, minerals, and other commodities to sustain its growth.  Unfortunately, the geopolitics and economics of natural resources are tricky. Most of them are located in unstable or war-torn countries, with poor infrastructure, corrupt governments, and intractable ethnic conflict. The global markets for natural resources are notoriously volatile and frequently go through boom-bust cycles. Worse still, as a late-comer to the scene, the low-hanging fruits have already been picked by entrenched and powerful Western multinationals, such as Exxon, Shell, BP, Rio Tinto, BHP, and the likes, which have established seemingly unchallengeable advantages in technology, capital, and risk management.

Faced with such a strategic landscape in the competition for natural resources, China has long concluded that it will risk letting its economic security held hostage by the vagaries of the market and the entrenched Western giants if it doesn’t make a concerted all-out effort to gain direct access to strategic natural resources. The policy and actions flowing from this strategic assessment in the past decade are easy to see: China has become the world’s most aggressive player in competing for access to natural resources. It has tied its foreign aid program to gaining concessions on exploiting natural resources. Its state-owned companies, supported by access to cheap (if not free) credit from Chinese banks, often outbid foreign competitors in securing contracts and exploration rights. It is willing to take excessive financial and security risks and encourages its companies to venture into areas, such as Sudan, Zimbabwe, and Congo, where their Western rivals don’t dare to tread.

But in executing this strategy, the Chinese have found themselves facing a fundamental dilemma: it’s a rising power with global economic interests, but no global power projection capabilities to protect these interests.

On most occasions, to be sure, China can free-ride on the security provided by the West, especially the United States. For example, with the U.S. Navy patrolling the sea lanes and keeping a close watch on conflict-prone areas, China gains free protection. One of the most illustrative cases is China’s $3 billion investment in an Afghan copper mine, which is protected by the U.S. Army.

Yet, free-riding has its limits. There are areas where conditions are so unstable that even Uncle Sam doesn’t want to risk the lives of its soldiers. Sudan is one such country.

If China insists on going it alone in its quest for resource security, its only option for protecting its sprawling interests is to develop commensurate power projection capabilities. This will be both costly and, more worryingly, cause anxieties among its neighbors and Western countries since it will entail sustained and massive increases in China’s military spending. This option, which will take years, if not decades, to implement, won’t meet the more immediate needs of providing security for Chinese economic interests in dangerous places anyway.

Without its own power projection capabilities, China will have to do one of two things.

First, it can simply do nothing and let itself be literally held hostage by the geopolitical and security risks prevalent in the regions where it has made valuable investments. This is hardly an attractive option because China risks losing its investments and its government, which has been subject to fierce criticisms in the Chinese cyberspace after the kidnapping of Chinese workers in Sudan, will appear weak, incompetent, and helpless.

Second, China can alter its existing go-alone strategy and join the West in ensuring collective resource security. This requires a fundamental change in Beijing’s mindset. (And obviously, similar adjustments are needed in the West as well.) Instead of viewing the quest for resources as a zero-sum game, China will see that its interests are closely linked with those of the West, and that it can make its investments and operations in far-flung regions more secure by pooling its efforts with those of the West.

Such a cooperative strategy will likely yield more benefits than China’s cut-throat competitive strategy. On the financial front, China won’t be wasting money trying to outbid its Western rivals (who will be partners). Its development aid will be more aligned with the goals of seeking conflict resolution and improving governance, rather than with obtaining competitive advantages in securing contracts. By partnering with the West in making resource-rich developing countries more stable, China will in fact reduce the risks of its investments and economic interests there. Even in crises such as the ongoing hostage drama in Sudan, a China in close cooperation with the West may seek direct assistance from its partners that have the requisite military capabilities in these areas. So for China, shifting its current strategy will be truly win-win.

To a Chinese leadership steeped in realpolitik and paranoia about the West, this proposal may sound naïve. But the alternatives are far worse. If Beijing stays on its present course of seeking resource security at any cost, it will run into crises far worse than the one they have just encountered in southern Sudan.

 

[Edward Campbell]

This article, reproduced under the Fair Dealing provisions of the Copyright Act from the Globe and Mail, is a reminder of how obscure Chinese politics can be:

http://www.theglobeandmail.com/news/politics/brewing-scandal-in-china-could-be-a-reality-check-for-harper/article2334141/

Brewing scandal in China could be a reality check for Harper

MARK MACKINNON

Guangzhou, China— Globe and Mail Update
Published Friday, Feb. 10, 2012

It’s the biggest political scandal to hit China in years, and Prime Minister Stephen Harper is about to land in the middle of it.

Bo Xilai, the charismatic and controversial Communist Party boss of Chongqing – the last stop Mr. Harper’s five-day, three-city visit to China – was until this week seen as a rising political star, all but certain to be promoted to the all-powerful Standing Committee of the Politburo during a once-in-a-decade transfer of power that begins this fall.

Then came the disappearance of his right-hand man, the former police chief and deputy mayor of Chongqing, Wang Liqun, in a cloak-and-dagger mystery worthy of a Cold War thriller. The swirling intrigue may dash Mr. Bo’s hopes of reaching the pinnacle of power, while providing a grim reminder of the opaque and sometimes-dangerous ways power works in this authoritarian state.

His whereabouts unknown, Mr. Wang is under police investigation and on what state media have called “vacation-style treatment.” The forced hiatus comes after he made a mysterious, unsanctioned visit on Monday to the United States consulate in Chengdu, several hours’ drive west of Chongqing.

The reasons why Mr. Wang went into the consulate – and what he said to the diplomats stationed there – has not been revealed. The consulate was surrounded by dozens of police vehicles who set up roadblocks until Mr. Wang emerged and gave himself up. “He did visit the consulate and he later left the consulate of his own volition,” a spokeswoman for the U.S. State Department confirmed.

Mr. Harper and Mr. Bo are still expected to meet on Saturday, but getting to know the man behind the Chongqing model may be less relevant than before the caper at the U.S. consulate.

The Chinese Internet is alive with rumours about what materials Mr. Wang might have given the Americans relating to Mr. Bo. Unlike most sensitive topics, online discussion of the case has not been thoroughly censored. Mr. Wang’s disappearance has also been given prominent coverage in the state-controlled media.

Wu Jiaxiang, a former researcher for the Central Committee of the Communist Party who is now an independent academic, said the lack of censorship means that some in Beijing are happy to leave the controversial Mr. Bo twisting in the wind. “Wang is just a pawn,” he said.

After Mr. Wang’s arrest, a letter attributed to him was posted online; it warned that if Mr. Bo rises to power in Beijing, “it will lead to calamity for China and disaster for our nation.”

“When everyone sees this letter, I’ll either be dead or have lost my freedom,” reads the letter, dated three days before Mr. Wang entered the U.S. consulate.

Mr. Wang’s political career is almost certainly now over, and questions are swirling around Mr. Bo as well. The two made headlines first for smashing Chongqing’s crime syndicates and introducing “red culture” campaigns that were imbued with nostalgia for the supposedly purer days of Mao Zedong.

It became known as the “Chongqing model,” and Mr. Bo was the darling of the country’s political left. Whispers abounded that parts of the Chongqing model would be implemented at the national level if Mr. Bo were promoted to the Standing Committee.

Now, some believe Mr. Bo’s path to power is far less clear. “It’s basically impossible for him to join the Standing Committee of Politburo” following this incident, said Zhang Ming, a professor of political science at Renmin University in Beijing. “[Wang Liqun] is a symbol of Chongqing Model. He was the core member of Bo’s team. The Chongqing Model with its Maoist symbols is now basically bankrupt.”

The Prime Minister met Friday with Wang Yang, the Communist Party boss in coastal Guangdong province and another rising political star who is considered a contender to join the Standing Committee of the Politburo this fall, when seven of its current nine members are due to retire.

Canadian officials said Mr. Harper and Mr. Wang discussed political reforms in the province, including the recent unrest in the village of Wukan, a rare instance of people power in China that saw villagers take to the streets to oust leaders they saw as corrupt and then hold their own elections. Mr. Wang has won plaudits for siding with the villagers in the dispute.

The episode in Chongqing may provide a reality check for the Prime Minister about the system and people he’s making deals with as he seeks to deepen Canada’s economic with China by lifting barriers to trade and investment.

In a speech Friday to an audience of Canadian and Chinese businesspeople in Guangzhou, Mr. Harper said that Canada would continue to press for greater rights and freedoms here as the economic relationship deepened.

“Canadians believe, and have always believed, that the kind of mutually beneficial economic relationship we seek is also compatible with a good and frank dialogue on fundamental principles such as freedom of speech, freedom of assembly, and freedom of belief and worship,” he said.

“And they demand that their government – and their businesses – uphold these national characteristics in all our dealings.”

The Chinese Communits party is not monolithic; there is a "hard left" wing, represented by Bo Xilai's red culture movement, there is a "hard right" wing represented by former leaders Jiang Zemin's Shanghai gang and a centre left movement represented by Hu Jintoa's current administration. Neither Jiang nor Hu was ever able to build a strong enough coalition in the Standing Committee to select their own successors.

The party aims for a sort of meritocracy but we have no way of measuring its success because the processes by which the members of the all powerful political centre are chosen remains very private.

 

[a_majoor]

And more on the Prime Minister's visit to China. Tweaking both the Americans, the environmental movement and the Chinese in his speech is probably going to lead to "interesting" consequences in the long run ("Interesting" in the Cinese sense of "living in interesting times").

http://news.nationalpost.com/2012/02/10/stephen-harper-pushes-for-responsible-oil-and-gas-trade-in-china-speech/

Harper in China: PM attacks ‘foreign money’ behind oil sands protest, refuses to trade human rights
Postmedia News  Feb 10, 2012 – 9:43 AM ET | Last Updated: Feb 10, 2012 12:24 PM ET
 
By Jason Fekete

GUANGZHOU, China — Prime Minister Stephen Harper delivered a pointed message Friday directly to the People’s Republic of China from the people back home: Canada wants to sell you its oil and gas, but won’t trade its principles along with it.

He also targeted groups opposed to Canada’s energy development, saying his government will put the country’s economic interests ahead of “foreign money and influence” trying to obstruct petroleum production.

Harper used a keynote speech to nearly 600 Chinese and Canadian business leaders gathered in Guangzhou — one of the largest cities in the world’s most populous country — to champion what he said is a new era in a strategic Canada-China energy partnership.

However, he also used the 21-minute speech to tell the Chinese, on their turf but in his terms, that Canada will not sever its trading relationships from national values such as human rights, and expects China to be a responsible global citizen.

And with major U.S. media outlets covering his speech, Harper also delivered a not-so-subtle reminder to the United States: if you don’t want Canadian oilsands crude, China is a waiting customer with a growing energy appetite.

Indeed, it wasn’t just what Harper had to say on Friday, but where he was delivering it.

In the first speech by a Canadian prime minister in Guangzhou, he reinforced the message that Canada wants to take its bilateral relationship to the “next level,” and that boosting trade is the way to achieve it.

Canada has an abundance of petroleum and is looking to “profoundly diversify” its trade relationships, Harper said, as well as deepen its economic cooperation with a booming China that needs resources to fuel its growth.

“We are an emerging energy superpower,” Harper told corporate leaders at the Canada-China business dinner in the city of 13 million people.

“We have abundant supplies of virtually every form of energy. And you know, we want to sell our energy to people who want to buy our energy. It’s that simple,” he said, to applause from the crowd.

Harper said it’s the government’s responsibility to ensure the resources are produced in an environmentally sustainable manner.

But the federal government must also put the interests of Canadians ahead of “foreign money and influence” that are deliberately trying to obstruct oil-and-gas development in Canada — such as the Northern Gateway oilsands pipeline — “in favour of energy imported from other, less stable parts of the world,” he said.

Harper noted that virtually all of Canada’s energy exports currently go to the U.S. and that it’s increasingly clear the country’s commercial interests are best served by diversifying its energy markets.

However, he argued Canada’s relative wealth and prosperity has come not only from resources and hard work, but also democracy, the rule of law and human rights.

Canadians believe in a frank dialogue on fundamental principles they cherish — such as freedom of speech, assembly and religion — and want their business dealings to follow those same values, he said.

He also told the Chinese that economic, social and political development are inseparable.

“Canada does not — and cannot — disconnect our trading relationship from fundamental national values,” Harper said.

“Therefore, in relations between China and Canada, you should expect us to continue to raise issues of fundamental freedoms and human rights and to be a vocal advocate for these, just as we will be an effective partner in our growing and mutually beneficial economic relationship.”

In the same vein, Harper called on China to be a responsible citizen on global security.

The federal government has expressed its extreme disappointment with China’s decision, along with Russia, to veto the United Nations Security Council’s resolution calling on Syrian President Bashar Assad to quit and help end the bloodshed in that country.

“Canadians also demand that their government be a responsible global citizen in dealing with the peace and security challenges that confront the world,” the prime minister added.

“And, wherever we can, urge other governments, including global actors like China, to do the same.”

Worth noting, though, is that Harper’s message on human rights and security was far more direct on Friday to business leaders than what he said publicly on the issue during two days of bilateral meetings in Beijing with Chinese President Hu Jintao and Premier Wen Jiabao.

Human rights groups in Canada urged Harper on the eve of his trip to raise, both privately and publicly, the “deeply troubling” rights abuses in China.

“The human rights situation in China has worsened recently and simply cannot be ignored,” argued Alex Neve with Amnesty International Canada.

But it is energy security, as much as global security and human rights, that Harper is promoting to China, and the message — at least on the petroleum possibilities — is being well received by the Chinese leadership.

Guangdong Province Governor Zhu Xiaodan, who attended the dinner with Harper, said his southern area of the country consumes an enormous amount of energy and needs additional supply.

“It’s our hope in the future we can import more high-quality energy and resource products from Canada,” Zhu said.

The Canadian government and energy sector are increasingly eyeing new pipeline projects that would send oilsands crude and liquefied natural gas to the West Coast for shipment by tanker to Asia.

Enbridge’s $5.5-billion Northern Gateway pipeline, which would ship oilsands bitumen from northern Alberta to a marine facility in Kitimat, B.C. is currently under review by the National Energy Board (NEB) and the Canadian Environmental Assessment Agency.

The pipeline could be operational by 2017, but faces mounting opposition from environmental groups and First Nations communities worried about the ecological footprint that could go with it.

Last fall, the NEB granted British Columbia’s Kitimat LNG terminal a 20-year export licence that will allow liquefied natural gas to be shipped to Asian markets.

Building additional pipeline capacity is even more critical if Canada is to get its resources to market, given the White House’s recent decision to reject, for now, the Keystone XL oilsands pipeline that would ship crude from Alberta to the U.S. Gulf Coast.

Harper’s four-day trade mission wraps up Saturday with a visit to a zoo in Chongqing to announce details of China loaning a pair of giant pandas to zoos in Toronto and Calgary for five years each.

The prime minister’s visit and interest in a stronger energy partnership with China has certainly drawn the attention of American politicians and media.

Major U.S. news agencies such as the Associated Press and Wall Street Journal covered the speech Friday from Guangzhou, according to the Prime Minister’s Office. Back in the U.S., Republican members of Congress are voicing their concerns about delays on the Keystone XL and Canada looking to ship its oil to China instead of stateside.

“I hope the American people fully understand exactly what’s going on here, because it’s time to act. Right now, Prime Minister Harper is talking to President Hu Jintao, the president of China, and believe me, China wants the oil,” Republican Sen. John Hoeven, from North Dakota, said this week on the floor of the Senate.

Meanwhile, Harper also trumpeted the growing educational ties between Canada and China, and earlier in the day visited the Huamei Bond International School, which teaches a Canadian curriculum.

Hundreds of kids, wearing red and white track suits and holding Chinese and Canadian flags, lined the walkway waiting for Harper on a cold and damp day.

Harper and wife Laureen stopped to speak to kids inside a classroom and library, before the prime minister joined in a brief game of ping-pong.

With files from Sheldon Alberts, Postmedia News

Edward's post just upthread illustrates the uncertainty that will surround our China venture; we really don't understand the politcs and culture as well as we should, and there may be many fundimental things that simply cannot be glossed over. Different ideas about Human Rights or intellectual property laws (among other things) are at the "civilizational" level that Samuel Huntington was speaking about in "The Clash of Civilizations"; the very ideas have different meanings to the different parties. Still, this is a high risk/high reward situation, so if *we* can make it work it will be a huge boon to Canada and Canadians.

 

[a_majoor]

Without comment:

http://news.nationalpost.com/2012/02/10/this-is-the-poem-that-got-a-chinese-activist-seven-years-in-jail/

This is the poem that got a Chinese activist seven years in jail
National Post Staff  Feb 10, 2012 – 2:44 PM ET | Last Updated: Feb 10, 2012 4:41 PM ET

Veteran Chinese activist Zhu Yufu has been jailed for seven years after being accused of “subversion of state power” by writing a poem.

This is his poem.

IT’S TIME

By Zhu Yufu, translated by A. E. Clark and reprinted with permission

It’s time, people of China! It’s time.
The Square belongs to everyone.
With your own two feet
It’s time to head to the Square and make your choice.

It’s time, people of China! It’s time.
A song belongs to everyone.
From your own throat
It’s time to voice the song in your heart.

It’s time, people of China! It’s time.
China belongs to everyone.
Of your own will
It’s time to choose what China shall be.

References to a “square” might evoke memories among many Chinese people of Tiananmen Square in Beijing, the epicentre of pro-democracy protests in 1989 that were quelled by armed troops, according to Reuters. But the poem did not mention that.

The harsh sentence has already led to calls for Prime Minister Stephen Harper to condemn the verdict. The Hong Kong-based Information Centre for Human Rights and Democracy urged Mr. Harper to speak out on Mr. Zhu’s behalf.

Amnesty International also hit out at the assault on Mr. Zhu’s “basic human right to freedom of expression.”

“We believe this is a sign that the Chinese leadership is afraid,” said Sarah Schafer, Amnesty International’s China researcher in a statement. “Why else would they sentence someone to seven years in prison for writing a poem? The Chinese government has seen the uprisings in the Middle East and North Africa. It has seen the people coming out in the tens of thousands to protest a repressive regime in Russia. And it has seen the Chinese people themselves grow stronger in their demands for more freedoms and a say over their country’s future. And now the leaders at the very top have clearly given out orders that any hint of dissent must be crushed.”

Mr. Zhu has been a thorn in the side of the Chinese government for more than a decade.

Between 1999 and 2006, he was jailed for founding a controversial political magazine and served another two years from 2007 after he confronted a policeman who questioned his son, said Agence France-Presse.

Mr. Zhu was detained last year as part of a widespread crackdown on dissent. As evidence of the “subversion of power” charge, prosecutors cited the poem as well as messages he sent on the Internet.

“The court verdict said this was a serious crime that deserved stern punishment,” said Mr. Zhu’s son, Zhu Ang, quoted by Reuters.

In December last year dissident Chen Wei was jailed for nine years for subversion after writing four online essays. Another activist Chen Xi was jailed for ten years for writing online.

The sentences were some of the heaviest since Nobel laureate Liu Xiaobo was jailed for 11 years on Christmas Day 2009.

National Post, with files from news services

 

[Edward Campbell]

Get used to seeing Xi Jinping; he will replace Hu Jintao as the Chinese leader later this year. His position on the Chinese political spectrum remains obscure but, for better or worse, he will be here for many years, possibly ten.

 

[sean m]

China's Nouveau Riche:

http://www.youtube.com/user/journeymanpictures?ob=4&feature=results_main.

One thing that seems to be known about the Chinese is that they are go getters, this video seems to demonstrate their commitment to achieving further financial success.. either immediately or in the future. They seem to want success immediately but are willing to wait if it is necessary.  They seem to be also willing to have the chance of making large sums of capital not just for themselves but also the future generations of their families.

 

[GAP]

China faces conflict of law, business in iPad row
By Joe McDonald Associated Press Friday, February 17, 2012
Article Link

BEIJING — Chinese officials face a choice in Apple’s dispute with a local company over the iPad trademark — side with a struggling entity that a court says owns the name or with a global brand that has created hundreds of thousands of jobs in China. Experts say that means Beijing’s political priorities rather than the courts will settle the dispute if it escalates.

Shenzhen Proview Technology has asked regulators to seize iPads in China in a possible prelude to pressing Apple Inc. for a payout. There have been seizures in some cities but no sign of action by national-level authorities.

Proview has a strong case under Chinese trademark law, but that could quickly change if Beijing decides to intervene to avoid disrupting iPad sales or exports from factories in southern China where the popular tablet computers are made, legal experts say.

“If this becomes political — and it’s very easy to see this becoming political — then I think Apple’s chances look pretty good,” said Stan Abrams, an American lawyer who teaches intellectual property law at Beijing's Central University of Finance and Economics.

The dispute centers on whether Apple acquired the iPad name in China when it bought rights in various countries from a Proview affiliate in Taiwan in 2009 for 35,000 British pounds ($55,000).

Apple insists it did. But Proview, which registered the iPad trademark in China in 2001, won a ruling from a mainland Chinese court in December that it was not bound by that sale. Apple appealed and a hearing is scheduled for Feb. 29.

“My gut reaction is that many of these activities really could be seen as pre-settlement brinksmanship,” said David Wolf, a technology marketing consultant in Beijing. “Proview’s motive is money, not to shut down Apple.”

Shenzhen Proview Technology is a subsidiary of LCD screen maker Proview International Holdings Ltd., headquartered in Hong Kong.

Chinese news reports say Proview is deeply in debt, increasing the pressure for it to demand a substantial payout from Apple. Proview International, meanwhile, has been suspended from trading on the Hong Kong stock market since August 2010 and will be removed in June if it cannot show it has sufficient assets, business operations and working capital.
More on link

 

[a_majoor]

Very nice assessment by Walter Russel Mead, we should be more focused on Asia as a whole rather than just China:

http://blogs.the-american-interest.com/wrm/2012/02/17/the-game-of-thrones-goes-dc/

The Game of Thrones Goes DC
Walter Russell Mead

Earlier this week I was in Washington, teaching a class and attending some events connected to the visit of China’s vice president.  It was an instructive time; in meetings with U.S. officials, with experts who follow China closely, and at the “state lunch” when Vice President Xi was the guest of honor at a State Department luncheon hosted by Secretary Clinton and Vice President Biden, I was able to get a close up view of some of the factors at work in shaping what just about everybody on the planet considers—in a hackneyed phrase — the most important bilateral relationship on planet Earth.

Via Meadia readers know that we try to organize our coverage here around the big stories that we think are shaping the world, and that the “game of thrones” in Asia is one of those. Obviously, an official visit to the United States by the man widely expected to become the president of China is an important move in that game; watching this event from a ringside seat helped me understand just what is and is not going on.

There was a lot to digest; the world is still processing the U.S. initiatives in Asia last fall, and partly because press coverage of the policy “pivot” was so weak and poorly thought through, the debate about our new Asia policy still hasn’t fully engaged the public.  Watching Xi, Biden and Clinton, and listening to some of the experts and officials who shaped and executed last fall’s dramatic U.S. shift, I came back north with a few new thoughts about where we stand and where we are headed.

First, I come away thinking that far too many people in Washington (and, as I’ve seen in the past) also in Beijing and in Europe, look at this relationship through the wrong lens.  They think and write and act as if the U.S. and China were the only significant players in the game, and that everything that happens in Asia boils down to U.S. and China relations.

This is wrong. The United States and China are not two gunmen staring each other down in main street at high noon while the timorous townsfolk cower in the saloon. The bilateral U.S.-China relationship has to be seen and evaluated in the context of the evolving geopolitical and economic structure of the Asia-Pacific world.

This matters a lot: failing to grasp the context is the root cause of some very consequential and widespread errors about U.S.-China relations. To look only at the bilateral relationship leads people to overstate both the likelihood of conflict between the two powers and to overestimate China’s strength. In China, those who think of the relationship out of context often push for a more aggressive Chinese foreign policy than the facts justify or China’s real interests warrant. In the United States, it leads people to divide into two camps: the declinists, who think the U.S. must try to appease a rising China, and the containers, who think we must work to contain China before it’s too late.

The Via Meadia view is a bit different. China isn’t rising in a vacuum; the rise of China, while significant, is less threatening to U.S. interests than either the appeasers or the containers think.  If you think about the question regionally, the option of a middle course emerges with greater plausibility: we can promote a regional environment that makes a Chinese bid for regional hegemony impossible without embracing a policy of containment. Especially given India’s rise, but also taking account of the growing power and capabilities of countries like Vietnam, Asia is just too big and too complicated for China to hope to dominate its hood the way that other powers have tried to dominate strategic geopolitical theaters.

From that perspective, America’s job is less to thwart China in a head-to-head confrontation than to promote the rise of an Asian system that provides for the prosperity and security of all the states in the region, including China. And ideologically, while the U.S. has no love for China’s one-party system, we do not perceive China as an aggressive ideological competitor like the Soviet Union; Chinese Communism isn’t trying to impose its tyranny on the whole world—and has little ideological appeal inside China, much less beyond its frontiers. While the U.S. can and should stand up for its own values, and while China’s embrace of state capitalism creates some disturbing economic dissonances that need to be dealt with, we are not in a cage match with an aggressive, expansionist communist ideology that is out to conquer and revolutionize the world.

The Washington tendency to focus on the bilateral relationship rather than the broader regional context was a little disturbing, and it has produced a more polarized debate than we need. I think this “bipolar bias” is partly due to the American practice of training and promoting China specialists rather than Asianists; there is a kind of instinctive bilateral fixation among people who know every twist and turn of U.S. and China policies and politics, but often know and think much less about the context.

It’s also about the relative marginalization of India in the American foreign policy world.  South Asia has been walled off from East Asia in the minds of foreign policy types for a long time; that is a problem when the integration of the two regions has become a central goal of American foreign policy.  The reality, as Via Meadia readers know, is that commercial and security ties between countries like Japan and India are growing rapidly, and as India’s horizons expand it is asserting its interests in Southeast and even East Asia much more forcefully than before.

The second big takeaway I brought home from Washington to New York is that although the plot line of American foreign policy in Asia looks pretty good, the soundtrack is too loud and too sharp. America is shooting from the lip. Vice President Biden’s “toast” (really, it was more of a roast) at the Xi luncheon was a classic example. Biden strung together a laundry list of complaints and criticisms as Xi stood there, smiling.

It is an election year, and China policy will be an issue, but the Vice President sounded tinny rather than strong, whiny rather than confident, and rude rather than frank. Constantly yapping at the leaders of foreign countries about policies that we know they will not change and that we have no power to get them to change is low rent, and it projects weakness just when we would want to be strong.

Beyond the occasional infelicities of tone, the U.S. hasn’t in my view done enough to emphasize the differences between a policy of supporting the rise of all Asia and a policy of containing China. The Chinese have always been suspicious that the U.S. was embarked on a project of containment (often translated as “throttling” in Chinese, I’ve been told) and encirclement; the events associated with last fall’s “pivot to Asia” plus some of the rhetoric this time around will strengthen the hands of those Chinese leaders who see us this way. Already, there are some signs of China pushing back against what many there perceive as a hostile and aggressive U.S. policy.

It’s time for people like the President, the Secretary of State and the Vice President to talk positively and publicly about a vision for Asia that looks to the security, independence, dignity and prosperity of everyone in the region and that suggests new and deeper forms of cooperation between the two biggest Pacific powers. Deepening American relations with China even as we deepen our relations with its neighbors is the best way to promote the kind of peace and prosperity we want in the Pacific.  Right now, we aren’t doing that quite as effectively as we should.

A third takeaway: the administration’s military budget doesn’t seem to track well with its foreign policy. This is partly about Asia and partly about the Middle East. In Asia, the administration proposes a robust policy on issues like the South China Sea that presuppose a high degree of military readiness. And in the Middle East, it cannot have escaped the administration’s notice that we remain quite deeply engaged and will need to preserve the capacity to act decisively and effectively as far ahead as the eye can see. Overall, the administration’s plans for significant defense cutbacks will be hostage to China’s plans for military modernization. Allies in Asia are wondering nervously whether the U.S. pivot is real or just talk. Making this policy work is going to involve a willingness to spend money. Perhaps the President is waiting until after the election to look this particular problem in the eye; perhaps the Office of Wishful Thinking has taken charge of the Pentagon budget process. But the administration has committed itself to ambitious and far reaching goals in Asia, and the world will be watching to see if it has enough money in the bank to cover the checks it has written.

A mix of forward deployment, aggressive anti-China rhetoric and declining military spending is close to the worst possible Asia policy.  A mix of forward deployment, deep engagement with both China and its neighbors and steady as you go spending is close to the best. My impression after my time in Washington is that a lot of people inside the government understand this; it remains to be seen whether the politicians can orchestrate the policy to keep us on the right track.

 

[Kirkhill]

Reposting this in the correct thread because I screwed up previously. :-[

We may not see the "discussion" between China and the West as a struggle, much less a conflict but not everybody necessary sees the situation in the same light:

China unwavering on Syria in new UN vote

China voted against a draft resolution on Syria at the UN General Assembly Thursday, days after it vetoed a UN Security Council draft resolution pressing for regime change in Damascus.

The country's courage to truly express itself and to calmly stand its ground is worthy of merit. Some Western media ridiculed certain nations, including China and Russia, for these choices. The trajectory of China's influence on world politics is rising. The West should be advised to reduce its expectations on abstention votes by China. Like it or not, China's stance must be taken into more serious consideration.

Politics serve to secure national interests on the global stage. Western powers are privileged to interpret interests and ethics at their own will due to their obvious dominance of public opinion. They label the 12 countries who voted differently to them at the UN as being "unethical." China should never be fooled by this hypocrisy.

The US and Israel were the only two nations that were against a draft resolution on Cuba at the UN Assembly in November. The US appeared to be more isolated than the current 12 nations. Washington acted against public global opinion despite its monopoly of the world's richest resources and leverage in directing the world's development.

China must act confidently and proactively in implementing its diplomatic strategy. China's vote, representing one-fifth of the entire world population, deserves its due respect.

It is wrong to blindly come down on the side of the West in each vote. Calls for China to vote in along with "universal values" can frequently be heard online. But that is a mere reflection of diverse and vibrant public voices.

Western values that contradict China's rise would eventually infiltrate global affairs and consequently seek to weaken China in various ways. As China rises, so will the pressure it faces. China appears to be an easy target for some Western media.

A lack of confidence is the root cause for the unease of some Chinese when faced with Western accusations. Confidence comes from looking at facts from a historical perspective. 

We have to halt the stereotyped view of China, which is a player more willing to make concessions to avoid trouble. They should be advised to look at China as a country that does not bring unnecessary trouble, but also never shuns away from dealing with trouble head-on. 

We are a peace-loving nation, which has not been involved in any military conflict for more than two decades. In sharp contrast, countries such as the US and Britain have engaged in numerous wars during the same period. Now, they think to lecture us on justice. Surely, they cannot ignore the irony.

The Link

Russia, China, And India Should Not Let The West Have Its Way In Syria

No matter how India looks at it, the end result is that for its own interests and for the interests of the whole world, India should join Russia and China to stand up against the western aggression against Syria and Iran. India should not let Syria become another Libya. If Syria falls, then the West is going to go after Iran. India has very crucial economic relations with Iran. The two countries have a long history of friendly relations. India cannot let the West dictate its relations with Iran. It is the western domino game plan. Libya, Syria, and then Iran. Can India guess who is next? Do not exclude yourself. Look what happened to the Indian friends: Iraq, Libya, the Soviet Union, and Yugoslavia!

By Dr. Sawraj Singh

Russia, China, and India should realize that Syria is the last battle for maintaining the western domination and the American era. If Russia, China, and India can join their forces and block the west in Syria, then the western domination of the last two centuries will end, and the unipolar world order, under the western domination and the American leadership, will be replaced by the multipolar world order. The most important thing for Russia, China, and India to understand is that they are not fighting Syria’s battle, but are fighting their own battle. None of the three countries can have a respectable status in the current unipolar world, and they need a multipolar world to get a proper and fitting status. Therefore, they are fighting their own battle.

Russia and China vetoed the resolution on Syria in the Security Council in the UN. This has drawn an unprecedented response from the western countries. The western media is blaming them for the situation in Syria. However, the truth is that the western countries are using their agents and terrorists to incite violence in Syria, so that they can use the violence as an excuse to attack Syria, just like they did in Libya. The West is using the UN and human rights as a cover for their aggression. Navi Pillai is trying to become an accomplice to this aggression by criticizing Syria for human rights violations. Obviously, she wants to make Syria another Libya. The whole world can see the West’s true face as far as human rights are concerned, in Libya. The most brutal and barbarian acts have been committed in Libya by the West and its agents and lackeys. The West wants to repeat this performance in Syria.

If the West succeeds in Syria, then the western domination may last for another half century. The West was defeated in Vietnam, and that was supposed to be the end of the western domination. However, by exploiting the difference between Russia and China, the West extended its domination for a half century. Now, by not letting Russia, China, and India unite, it may extend its survival for another half century.

Russia and China seem to understand the western designs better than India. Being a Hindu majority country, the West’s propaganda against Islamic fundamentalism and terrorism throws India off balance. India does not realize that almost all the so-called Islamic fundamentalist and terrorist groups have been created by the CIA. Can India not see that all the secular regimes in the Islamic countries have been toppled by these groups in collaboration with the West? Iraq and Libya went through that, and now the same thing is happening in Syria. What more proof does India want? The truth is that not only the so-called Islamic fundamentalists, but almost all extremists, fundamentalists, and fanatics in every religion are blessed by the CIA. The west can incite any kind of fundamentalism, extremism, and fanaticism to advance its cause. India should have no illusion that being a secular state, it has already been targeted by the CIA for balkanization and disintegration after the Soviet Union and Yugoslavia.

If India wants to remain a secular and neutral country, then it has no other choice but to join Russia and China to expose and counter the western designs. Syria and Iran are very good opportunities for India to revive its credentials of secularism and neutrality. This is also the best time to revive the traditional friendship with Russia.

India should realize that Russia and China are going to stand firm against the western hooliganism, arrogance, double standards, and hypocrisy, whether India joins them or not. However, if India joins them, then it will be in the best interests of not only the Indian people, but of the whole world, including the American and the European people. Without India, the West may not fight a Third World war with Russia and China, because it may find it difficult to match China’s manpower. Therefore, with India joining Russia and China, the chances of a peaceful transition from a unipolar to a multipolar world order increase. This is in the best interests of the people of the world: to preserve peace and harmony in the world. India can play a crucial role.

No matter how India looks at it, the end result is that for its own interests and for the interests of the whole world, India should join Russia and China to stand up against the western aggression against Syria and Iran. India should not let Syria become another Libya. If Syria falls, then the West is going to go after Iran. India has very crucial economic relations with Iran. The two countries have a long history of friendly relations. India cannot let the West dictate its relations with Iran. It is the western domino game plan.

Libya, Syria, and then Iran. Can India guess who is next? Do not exclude yourself. Look what happened to the Indian friends: Iraq, Libya, the Soviet Union, and Yugoslavia.

Dr. Sawraj Singh, MD F.I.C.S. is the Chairman of the Washington State Network for Human Rights and Chairman of the Central Washington Coalition for Social Justice. He can be reached at sawrajsingh@hotmail.com.

 

[tomahawk6]

China’s Falkland Islands Lesson

http://the-diplomat.com/flashpoints-blog/2012/02/21/china’s-falkland-islands-lesson/

We’re rapidly approaching the thirtieth anniversary of the Falklands War (April to June 1982), which saw the British military reclaim the United Kingdom’s remote South Atlantic island possessions from Argentine invaders.

Gen. Sir Michael Jackson, a former British Army chief of staff, recently made headlines when he proclaimed that defense cuts make it “just about impossible” for British naval forces to wrest back the Falklands should Argentina occupy them again. The Royal Navy retired aircraft carrier HMS Ark Royal last year, leaving the navy with zero capacity to project fixed-wing air power by sea until the troubled Queen Elizabeth-class flattops enter service, presumably around the end of this decade. London also sold the nation’s entire inventory of Harrier jump jets to the U.S. Marine Corps for spare parts, leaving the navy with zero air power to project until the F-35 Joint Strike Fighter enters service, also around the end of the decade.

Like nature, power politics abhors a vacuum. It’s probably no coincidence that Buenos Aires is ramping up its demands for the islands as Britain’s capacity to re-conquer them dwindles. Economically stagnant Argentina desperately wants to tap the natural resources found in the waters and seabed adjacent to the Falklands. A recent series of oil discoveries – most recently in the “Sea Lion” field eighty miles north of the islands – has spurred talk of a “black gold rush” in the South Atlantic. Argentine President Cristina Fernandez de Kirchner has reproached London for exhausting “Argentinean natural resources” while vowing to “get [the islands] back.” Meanwhile, Britain’s shrinking expeditionary capability has reduced officials like Brig. Bill Aldridge, commander of British forces in the South Atlantic, to insisting that it matters little whether the British military can recover the Falklands; it will never lose them in the first place. Declares Aldridge, “I am not expecting to hand the islands over to anybody and therefore put us in a position to have to retake the islands.”


Maybe hope really is a strategy!

The latest kerfuffle has caught some attention beyond Argentina and the British Isles. You can bet strategists in China are monitoring events in the South Atlantic closely. These are people who do their homework. They afforded the 1982 conflict close scrutiny, finding much to commend and condemn on both sides, and many lessons to learn. A few years ago, my colleague Lyle Goldstein read their commentary on the Falklands and wrote an article documenting their findings. It only makes sense that Beijing would regard the campaign as a source of guidance for contemporary strategy. Just look at the map – a Western sea power fought a short war to reverse a weaker regional power’s seizure of islands it considered sovereign territory. Geography compelled the extra-regional power to stage military operations across thousands of miles of ocean, where the local power enjoyed such advantages as proximity to the combat theater, abundant manpower and resources, and intimate familiarity with the surroundings.

Sound familiar?

What lessons about strategy, tactics, and force structure is Beijing likely to derive from the British experiences then and now? Lyle’s article is worth reading in its entirety, but here’s the bumper sticker for the guidance China takes from the conflict: a local power can overcome a stronger outside power if it is more willing than its antagonist to bear the costs and hazards of war, makes good use of its “home field advantage,” and acquires certain specialized weaponry in adequate numbers.

For example, Chinese commentators highlight the battle damage inflicted by Argentine Super Étendard fighter jets firing Exocet anti-ship cruise missiles. When I taught firefighting and damage control in the 1990s, we started off each new class by showing a film from the Falklands. My favorite part was when the skipper of the sunken HMS Sheffield recalled thinking it was “slightly bad news” when he heard an explosion and turned to see one of the ship’s gun mounts spinning around in the air high over the ship. Monty Python humor aside, the death of the Sheffield confirmed that sea-skimming missiles could evade modern shipboard air defenses and wreak lethal damage. Whether this inspired the People’s Liberation Army Navy to premise its anti-ship tactics on “saturation attacks” that overwhelm a fleet’s defenses is an open question. More likely, such encounters reaffirmed tacticians’ preexisting preference for cruise missiles as an implement of war. Had Argentine aviators possessed more than a few Exocets, conclude Chinese observers, the outcome of the conflict could have been far different.

Or, there’s undersea warfare. Both navies put submarines to effective use as an offensive weapon; both performed miserably at finding and sinking enemy submarines. A Royal Navy nuclear-powered attack submarine made short work of the Argentine cruiser General Belgrano, prompting the Argentine surface fleet to stay safely out of range for the rest of the war. For their part, Royal Navy anti-submarine crews were unable to reliably classify sonar or magnetic contacts, so they “classified targets with ordnance.” That’s a fancy way of saying they dropped anti-submarine munitions on anything with a signature remotely resembling that of an Argentine boat. This ham-fisted approach had a perverse strategic effect: it virtually exhausted the Royal Navy’s war stock of antisubmarine weaponry at a time of surging tension in the Cold War. The division of labor among NATO fleets assigned British mariners the task of policing North Atlantic waters for Soviet craft. That was hard to do once the Falklands campaign emptied Royal Navy warships’ weapons magazines. Lesson: antisubmarine warfare is hard even for the world’s most advanced navies.

How will the PLA Navy and the shore-based arms of Chinese sea power put such lessons to work in future conflicts? Savvy commanders might strike at U.S. Navy reinforcements steaming westward across the Pacific far from Asian coasts, wearing them down during their long voyage. Argentina missed several opportunities to make things tough on the oncoming British task force before it reached the theater. That China would repeat this mistake is doubtful. Targeting logistics vessels carrying supplies to U.S. carrier or amphibious groups, for instance, would be a convenient way to disrupt any relief operation off Taiwan or some other hotspot. These lumbering ships are few in number, carry token defensive armament, and often cruise without protective escorts. They would be easy pickings for Chinese submarines, let alone multidirectional cruise-missile strikes of the kind Chinese rocketeers envision. Take out the oilers, refrigeration ships, and ammunition ships, and the fleet withers on the vine.

In short, as they consider how to pierce Chinese “anti-access” defenses, U.S. strategists could do worse than investigate what pundits from the “red team” are saying about the Falklands dispute – then and now.

James Holmes is an associate professor of strategy at the U.S. Naval War College and co-editor of the forthcoming ‘Strategy in the Second Nuclear Age’ (Georgetown University Press). The views voiced here are his alone.

 

[Edward Campbell]

Although this, reproduced under the Fair Dealing provisions of the Copyright Act from the Globe and Mail, is a Canadian business story, I suspect it is a common problem for acciunting/audit firms from many countries and I also guess the problem is not limited to China:

http://www.theglobeandmail.com/globe-investor/canadian-audits-of-chinese-based-companies-under-fire/article2344920/

Canadian audits of Chinese-based companies under fire

JANET MCFARLAND

Globe and Mail Update
Published Tuesday, Feb. 21, 2012

Canadian accounting firms are doing “disappointing” work when they audit the financial statements of Chinese-based companies that list their shares on Canadian stock exchanges, according to a new review by Canada’s audit regulator.

The Canadian Public Accountability Board released results Tuesday of a three-month review examining the work of Canadian audit firms who have Chinese clients, and said it found major gaps in the audit work. One unidentified audit firm has been restricted from taking any more Chinese clients, while others were required to do additional work on 12 of the audit files that were reviewed.

“The disappointment we had was a lot of things that we felt were fundamental auditing processes and procedures were just not applied,” CPAB chief executive officer Brian Hunt said in an interview Tuesday.

“It’s just a disappointment on our part that things we would consider fundamental here in Canada just were not done, and I’m at somewhat of a loss to explain it.”

The report does not identify the audit firms whose work was reviewed, but Mr. Hunt said they include the major national audit firms as well as a number of smaller firms that offer auditing of Chinese companies.

CPAB said nine of the 12 files that required additional work after CPAB’s review involved smaller regional or local audit firms, but it also noted that it could not review all the documentation for six of the audits involving major national firms because the work was performed by affiliated firms in foreign countries and the paperwork was not available.

“It was therefore impossible to fully evaluated the quality of work performed by the affiliated firms,” the review states.

Mr. Hunt said he also could not identify the 24 public companies whose audits were reviewed, and would not comment on whether Sino-Forest Corp. was one of the audits scrutinized.

The Chinese-based forestry saw its shares suspended last summer on the Toronto Stock Exchange after the board of directors launched a review of its business practices following accusations from a short seller that the firm was operating as a “Ponzi scheme.” The Ontario Securities Commission is still examining the company’s operations.

Mr. Hunt said he does not believe the problems identified are unique to audits of Chinese companies, and said CPAB plans to expand its review this year to audits of other companies based in developing countries whose shares trade in Canada. He said the further reviews will look at companies based in Russia, India, Brazil and other locations.

Auditors must understand that business practices vary in many other countries, and they have to be more alert to possible problems, Mr. Hunt said. For example, he said audit firms must be more careful when getting confirmations of bank balances or accounts receivable in other countries, and in confirming ownership of assets held by the company.

Indeed, CPAB found some auditors were not even applying typical Canadian standards when seeking confirmations. For example, the regulator said it found cases where management controlled the gathering of external confirmations – instead of the auditors themselves contacting the banks or third-party creditors.

Despite the concerns, Mr. Hunt said he believes there is no reason for CPAB to suggest Canadian audit firms should not audit the books of foreign-based companies.

“I think the audit firms do have the capabilities and the talent to do it. There are language barriers, but that’s not typically a show-stopper,” he said.

“The real issue is understanding the unique business practices, and that’s where our disappointment is that a lot of the firms that went over to do these audits just did not recognize that there are differences.”

"Disappointment" is a pretty strong word for auditors to use about colleagues - it means, I think, that Canadian auditors were helping their Chinese clients to "cook the books, to fool the Canadian securities regulators.

But, I repeat: I suspect there are similar irregularities to be found in US, Japanese and European audits of Chinese companies and of Western audits of other Asian firms.

 

[a_majoor]

While much of the evidence is circumstancial, it is interesting to see who benefits from the demise of Nortel:

http://business.financialpost.com/2012/02/25/nortel-hacked-to-pieces/

Nortel hacked to pieces
Jameson Berkow  Feb 25, 2012 – 9:30 AM ET | Last Updated: Feb 25, 2012 11:19 AM ET

Sara D. Davis for National Post

Under mounting pressure to prove China-based hackers had infiltrated the vast global computer network of Nortel Networks Corp. all the way to the chief executive’s terminal, Brian Shields felt he had no choice but to go rogue.

Armed with nearly two decades doing security for the now-defunct Canadian company whose technology still powers telecommunications networks around the world, he had spent a day just before Christmas 2008 digging through the Web browsing history of then CEO Mike Zafirovski, known to colleagues as ‘Mike Z’. Mr. Shields was convinced there were criminals working on behalf of China’s Huawei Technologies Co. Ltd. accessing the CEO’s files, but his hunch hadn’t been enough for his immediate bosses to grant him direct access to the top man’s PC.

“I went on my own then and pulled the Web logs from Mike Z. since I had access to those kinds of logs back then,” the 53-year-old Nortel veteran recalled. It was there he finally found the digital smoking gun he had spent years trying to find.

“I went through about two months and, sure enough, I found that right in the middle of a Yahoo session he had some activity go over to Beijing that didn’t fit in with any of the other URL information that was showing up. It didn’t belong there, it just didn’t. This was rotten.”

As reported by the Wall Street Journal this month, hackers had free reign inside Nortel’s network for more than a decade before the company went bankrupt in 2009. Now, in lengthy interviews with the Financial Post, Mr. Shields and a third-party digital forensics expert who worked on the investigation shed more light on the cyber criminals they were pursuing, their intentions and the inexplicable lack of response from Nortel’s senior staff.

The revelations serve as a wake up call not only to the companies who purchased Nortel’s infected hardware, but to the global technology industry at large.

The attackers were “clearly recent graduates of a Chinese polytechnic” who were “heavily in debt,” yet by 2009 seemed to have “more money than they ever imagined,” according to the third-party expert who works for a leading U.S. computer security tool vendor who requested anonymity.

Although never formally contracted by Nortel to aid the investigation, the expert had been sought out by Mr. Shields in the summer of 2008 for his advice and assistance in analyzing some of the machines he believed were infected. Nortel’s own anti-malware specialist had been unable to find any evidence of foul play, but Mr. Shields refused to let the matter drop.

“I thought [helping Brian] might land me some work down the line,” the expert said. “Nortel was, after all, still a very big company at the time.”

Not only did the expert’s analysis confirm that rootkits (malicious software designed to make certain processes running on a device invisible to basic inspection) existed on the machines identified by Mr. Shields, but that it was professionals who had put them there.

“Brian would wipe the hard drive of one of the machines and re-image it, then we did a second memory image within five minutes,” the expert said. “It was a lot cleaner but I still found a couple of artifacts that told me the rootkit was still there. So it was something sophisticated that was able to survive a reformat of the system.”

Once the hidden processes were discovered, the expert was able to trace the perpetrators to Chinese IP addresses, some of which also had accounts on a Mandarin-language bulletin board hosted just outside of Beijing. It was there the expert was able to glean personal details about the hackers and what they were doing in Nortel’s system.

“They were doing surveillance, intelligence gathering,” he said.

“They were watching what [programs] people were using, what they were doing, what emails they were reading and that is exactly what we would expect to see from someone who was basically engaged in espionage.”

Still, neither the expert nor Mr. Shields was able to establish a direct link between the hackers and their mysterious benefactors. Mr. Shields’ conviction that the Chinese government was involved on behalf of Huawei remains circumstantial at best: the Shenzhen-based company had surpassed US$100-million in annual sales to international markets in 2000, the year many Nortel historians mark as the start of the former Canadian corporate champion’s fall from grace. Huawei enjoyed rapid global growth from that point onward.

Today, many former Nortel customers — including BCE Inc., Canada’s largest telecommunications firm — have moved to Huawei. Analysts expect the privately held company will overtake Ericsson as the world’s largest telecom equipment vendor when it reports annual figures this spring, giving Huawei the crown once worn by Nortel.

China’s embassy in Washington issued a statement to the WSJ specifically denying any involvement in the Nortel hacking, saying “cyber attacks were transnational and anonymous” and shouldn’t be assumed to originate in China “without thorough investigation and hard evidence.”

Finger pointing aside, Mr. Shields believed he did have hard evidence of somebody hacking Nortel’s systems, even if he couldn’t prove who was paying them. Once he found proof of hackers breaching the chief executive’s own computer in late 2008, he presented his findings to Pat Cottrell, Nortel’s IT security manager at the time. Surely now, he thought, he would get the approvals and the attention needed to more thoroughly inspect Mike Z’s computer.

Instead, her response according to Mr. Shields was “Mike Z is a very busy man, he is trying to sell business units and we can’t be slowing him down and trying to interrupt him with memory dumps of his computer.” Ms. Cottrell declined to comment on this story, citing a confidentiality agreement with her current employer.

“I hit myself in the head,” Mr. Shields said. “[Mr. Zafirovski] wouldn’t have even known [the memory dump] had happened. It would have slowed his machine down for maybe 10 minutes.”

Mr. Shields says he struggled for resources ever since the breach was discovered by a Nortel employee based in the United Kingdom in 2004. He even spent several hours in November of 2007 explaining his concerns in a meeting he said was attended by several Nortel executives including Jack Reyes, vice-president of corporate security, and Randy Calhoun, Nortel’s director of corporate and systems security.

They told him to prepare an audit report, which Mr. Shields said he filed in early 2008 but that was never passed along to upper management.

Mr. Reyes could not be reached and Mr. Calhoun, now an independent security consultant based in Dallas, declined to comment. Mr. Shields had a reputation as someone who would “cry wolf,” Mr. Zafirovski told the WSJ.

“I may have been crying wolf,” said Mr. Shields. “That is what my boss was thinking, but the problem was, there was a wolf.”

The digital forensics expert who helped with the investigation “can understand, once [Nortel] started to sell off the company, why they wouldn’t want something like this to come to light.”

“I’m sure some of the people who bought Nortel assets out of the bankruptcy sale wouldn’t have paid as much if they knew they were getting a bunch of computers that were deeply infected with malware.

“Particularly the way Brian got fired [in early 2009] just when he was about to succeed made me and some of my friends really suspicious,” the expert said, adding “in the face of this evidence [Nortel] didn’t really take any action, which was odd.”

Last week, after reading about his report in the WSJ, someone working in the IT department at a buyer of one of the sold Nortel divisions — he declined to say which one; Nortel’s various assets were purchased by several different firms — got in touch with Mr. Shields.

“Can you please help me?” the employee said, according to Mr. Shields.

After learning the employee was the only one handling computer security at his company in addition to several other IT-related responsibilities, Mr. Shields had to decline.

“I said ‘Oh geez, oh man, you’ve already told me more than I needed to know’. They just don’t have people focused on this problem and that is part of the problem,” he said.

Despite an acceleration of high-profile cyber attacks against major global networks in recent years, many executives fail to recognize the potentially devastating nature of such cyber threats, said Gene McLean, vice-president and chief security officer at Telus Corp. from 2001 until 2008.

There is data to support this growing lack of awareness. Last October, security software giant Symantec Corp. released a study that found operators of telecommunications networks, power grids, water systems and other services of vital importance had grown “less concerned about threats and less ready” than they were a year prior even as attacks have grown more frequent and sophisticated.

“If it was a widespread infection — and [Nortel] was a global, well-known, respected organization at that time — you’d have a half-dozen people on that easily to find out what is happening and stop it. Once you’ve done that you certainly need to inform the corner suite; the CEO has to be aware,” Mr. McLean said.

“A good corporate citizen like Telus would certainly jump right on something like that. Others, hard to say.”

 

[a_majoor]

Another potential Black Swan. If the Chinese government is unwilling to give up control (or perhaps the social and cultural model of Chinese Civilization requires central control) then China may not be able to transition out of the current economic model, and be stuck in the "middle". I wonder if these sorts of social stresses being caught in the middle (rising expectations by the population, rising population pressure but a now fixed resource base to meet these needs) were the cause of previous breakdowns in Chinese history?

http://www.telegraph.co.uk/finance/china-business/9109683/China-risks-middle-income-trap-without-free-market-revolution.html

China risks 'middle income trap' without free market revolution
China’s spectacular catch-up growth is nearing its limits, leaving the country prey to the "middle income trap" over coming years unless Beijing embraces the free market and relaxes its suffocating grip over the economy.

China clearly needs to hack away a thicket of impediments, starting with the semi-feudal Hukou system that denies rural migrants rights to urban registration, or access to healthcare, education and housing in the cities Photo: EPA

A joint report by the World Bank and China’s Development Research Centre has warned that the low-hanging fruit of state-driven industrialization is largely exhausted.

"As China’s leaders know, the country’s current growth model is unsustainable," said Robert Zoellick, the World Bank’s president. "This is not the time just for muddling through. It’s time to get ahead of events."

Countries across Latin America and the Middle East saw catch-up growth in the 1960s and 1970s but then they hit an invisible ceiling and have mostly languished in the "middle income trap" ever since, with per capita incomes far behind the rare "break-out" states such as Japan and Korea. "If countries cannot increase productivity through innovation, they find themselves trapped. China does not have to endure this fate," it said.

There is no doubt that the existing model has hit the buffers on every front and risks "unbearable friction" with trading partners unless the trade surplus is brought under control.

China is running out of cheap labour from the countryside and faces a "wrenching demographic change" as the old-aged dependency ratio doubles to North European levels within 20 years, and is fast depleting aquifers in the North China plains.

It can no longer rely on imported technology to keep up blistering growth averaging 9.9pc since Deng Xiaoping began to throw open the economy in 1978 and unleashed the nation’s pent-up commercial energy. "China has reached another turning point in its development path when a second strategic, and no less fundamental, shift is called for," it said.

The report has been seized upon by Politburo reformers battling hardliners and vested interests. Li Keqiang, groomed to take over as premier this year, offered his "unwavering support" for the findings.

He faces tenacious resistance from factions within the party, who insist that the country’s resilience through the global capitalist heart attack of 2008-2009 has vindicated state control of key industries and banks.

The report said China’s growth will slow to 7pc later this decade and 5pc by the late 2020s even if China embraces deep reform. Stagnation lies in wait if it clings to the dirigiste model.

"The forces supporting China’s continued rapid progress are gradually fading. The government’s dominance in key sectors, while earlier an advantage, is in the future likely to act as a constraint on creativity," it said.

"The role of the private sector is critical because innovation at the technology frontier is quite different in nature from catching up technologically. It is not something that can be achieved through government planning."

The picture is complex. China already lets local leaders embark on bold experiments under its strategy of "crossing the river by feeling the stones", permitting a mosaic of different policies that marks it out from other catch-up economies.

However, the country clearly needs to hack away a thicket of impediments, starting with the semi-feudal Hukou system that denies rural migrants rights to urban registration, or access to healthcare, education and housing in the cities.

The report said a quarter of China’s state companies are loss-making and have a productivity growth rate two-thirds lower than private firms, yet they gobble up available credit. Those private companies that resort to the parallel market for credit face grave risks, and one leading tycoon faces the death penalty.

Restructuring these state behemoths cost 20pc of GDP in the early 1990s, and it will be worse this time since the investment bubble has been much larger. "Potential costs of reforming state enterprises may have climbed significantly because opaque accounting practices mean that some state enterprises have accumulated large contingent liabilities that will need to be revealed," it said.

If all goes well, China will be a "high-income" economy by 2030 and perhaps as dominant as Britain in 1870 or the United States in 1945, or indeed as flourishing as the Qing Empire itself in 1820 before the onset of catastrophic decline. Politics will decide.

 

[sean m]

Here is an interesting article from STRATFOR,

The State of the World: Assessing China's Strategy

http://www.stratfor.com/weekly/state-world-assessing-chinas-strategy?utm_source=freelist-f&utm_medium=email&utm_campaign=20120306&utm_term=gweekly&utm_content=readmore&elq=37f52ff891d14a67be453d549665bfe3

Taken from their website;

Simply put, China has three core strategic interests.

Paramount among them is the maintenance of domestic security. Historically, when China involves itself in global trade, as it did in the 19th and early 20th centuries, the coastal region prospers, while the interior of China -- which begins about 160 kilometers (100 miles) from the coast and runs about 1,600 kilometers to the west -- languishes. Roughly 80 percent of all Chinese citizens currently have household incomes lower than the average household income in Bolivia. Most of China's poor are located west of the richer coastal region. This disparity of wealth time and again has exposed tensions between the interests of the coast and those of the interior. After a failed rising in Shanghai in 1927, Mao Zedong exploited these tensions by undertaking the Long March into the interior, raising a peasant army and ultimately conquering the coastal region. He shut China off from the international trading system, leaving China more united and equal, but extremely poor.

The current government has sought a more wealth-friendly means of achieving stability: buying popular loyalty with mass employment. Plans for industrial expansion are implemented with little thought to markets or margins; instead, maximum employment is the driving goal. Private savings are harnessed to finance the industrial effort, leaving little domestic capital to purchase the output. China must export accordingly.

China's second strategic concern derives from the first. China's industrial base by design produces more than its domestic economy can consume, so China must export goods to the rest of the world while importing raw materials. The Chinese therefore must do everything possible to ensure international demand for their exports. This includes a range of activities, from investing money in the economies of consumer countries to establishing unfettered access to global sea-lanes.

The third strategic interest is in maintaining control over buffer states. The population of the historical Han Chinese heartland is clustered in the eastern third of the country, where ample precipitation distinguishes it from the much more dry and arid central and western thirds. China's physical security therefore depends on controlling the four non-Han Chinese buffer states that surround it: Manchuria, Inner Mongolia, Xinjiang and Tibet. Securing these regions means China can insulate itself from Russia to the north, any attack from the western steppes, and any attack from India or Southeast Asia.

Controlling the buffer states provides China geographical barriers -- jungles, mountains, steppes and the Siberian wasteland -- that are difficult to surmount and creates a defense in depth that puts any attacker at a grave disadvantage.

Challenged Interests
Today, China faces challenges to all three of these interests.

The economic downturn in Europe and the United States, China's two main customers, has exposed Chinese exports to increased competition and decreased appetite. Meanwhile, China has been unable to appropriately increase domestic demand and guarantee access to global sea-lanes independent of what the U.S. Navy is willing to allow.

Those same economic stresses also challenge China domestically. The wealthier coast depends on trade that is now faltering, and the impoverished interior requires subsidies that are difficult to provide when economic growth is slowing substantially.

In addition, two of China's buffer regions are in flux. Elements within Tibet and Xinjiang adamantly resist Han Chinese occupation. China understands that the loss of these regions could pose severe threats to China's security, particularly if such losses would draw India north of the Himalayas or create a radical Islamic regime in Xinjiang.

The situation in Tibet is potentially the most troubling. Outright war between India and China -- anything beyond minor skirmishes -- is impossible so long as both are separated by the Himalayas. Neither side could logistically sustain large-scale multi-divisional warfare in that terrain. But China and India could threaten one another if they were to cross the Himalayas and establish a military presence on the either side of the mountain chain. For India, the threat would emerge if Chinese forces entered Pakistan in large numbers. For China, the threat would occur if large numbers of Indian troops entered Tibet.

China therefore constantly postures as if it were going to send large numbers of forces into Pakistan, but in the end, the Pakistanis have no interest in de facto Chinese occupation -- even if the occupation were directed against India. Likewise, the Chinese are not interested in undertaking security operations in Pakistan. The Indians have little interest in sending forces into Tibet in the event of a Tibetan revolution. For India, an independent Tibet without Chinese forces would be interesting, but a Tibet where the Indians would have to commit significant forces would not be. As much as the Tibetans represent a problem for China, the problem is manageable. Tibetan insurgents might receive some minimal encouragement and support from India, but not to a degree that would threaten Chinese control.

So long as the internal problems in Han China are manageable, so is Chinese domination of the buffer states, albeit with some effort and some damage to China's reputation abroad.

The key for China is maintaining interior stability. If this portion of Han China destabilizes, control of the buffers becomes impossible. Maintaining interior stability requires the transfer of resources, which in turn requires the continued robust growth of the Chinese coastal economy to generate the capital to transfer inland. Should exports stop flowing out and raw materials in, incomes in the interior would quickly fall to politically explosive levels. (China today is far from revolution, but social tensions are increasing, and China must use its security apparatus and the People's Liberation Army to control these tensions.)

Maintaining those flows is a considerable challenge. The very model of employment and market share over profitability misallocates scores of resources and breaks the normally self-regulating link between supply and demand. One of the more disruptive results is inflation, which alternatively raises the costs of subsidizing the interior while eroding China's competitiveness with other low-cost global exporters.

For the Chinese, this represents a strategic challenge, a challenge that can only be countered by increasing the profitability on Chinese economic activity. This is nearly impossible for low value-added producers. The solution is to begin manufacturing higher value-added products (fewer shoes, more cars), but this necessitates a different sort of work force, one with years more education and training than the average Chinese coastal inhabitant, much less someone from the interior. It also requires direct competition with the well-established economies of Japan, Germany and the United States. This is the strategic battleground that China must attack if it is to maintain its stability.

A Military Component
Besides the issues with its economic model, China also faces a primarily military problem. China depends on the high seas to survive. The configuration of the South China Sea and the East China Sea render China relatively easy to blockade. The East China Sea is enclosed on a line from Korea to Japan to Taiwan, with a string of islands between Japan and Taiwan. The South China Sea is even more enclosed on a line from Taiwan to the Philippines, and from Indonesia to Singapore. Beijing's single greatest strategic concern is that the United States would impose a blockade on China, not by positioning its 7th Fleet inside the two island barriers but outside them. From there, the United States could compel China to send its naval forces far away from the mainland to force an opening -- and encounter U.S. warships -- and still be able to close off China's exits.

That China does not have a navy capable of challenging the United States compounds the problem. China is still in the process of completing its first aircraft carrier; indeed, its navy is insufficient in size and quality to challenge the United States. But naval hardware is not China's greatest challenge. The United States commissioned its first aircraft carrier in 1922 and has been refining both carrier aviation and battle group tactics ever since. Developing admirals and staffs capable of commanding carrier battle groups takes generations. Since the Chinese have never had a carrier battle group in the first place, they have never had an admiral commanding a carrier battle group.

China understands this problem and has chosen a different strategy to deter a U.S. naval blockade: anti-ship missiles capable of engaging and perhaps penetrating U.S. carrier defensive systems, along with a substantial submarine presence. The United States has no desire to engage the Chinese at all, but were this to change, the Chinese response would be fraught with difficulty.

While China has a robust land-based missile system, a land-based missile system is inherently vulnerable to strikes by cruise missiles, aircraft, unmanned aerial vehicles currently in development and other types of attack. China's ability to fight a sustained battle is limited. Moreover, a missile strategy works only with an effective reconnaissance capability. You cannot destroy a ship if you do not know where it is. This in turn necessitates space-based systems able to identify U.S. ships and a tightly integrated fire-control system. That raises the question of whether the United States has an anti-satellite capability. We would assume that it does, and if the United States used it, it would leave China blind.

China is therefore supplementing this strategy by acquiring port access in countries in the Indian Ocean and outside the South China Sea box. Beijing has plans to build ports in Myanmar, which is flirting with ending its international isolation, and Pakistan. Beijing already has financed and developed port access to Gwadar in Pakistan, Colombo and Hambantota in Sri Lanka, Chittagong in Bangladesh, and it has hopes for a deepwater port at Sittwe, Myanmar. In order for this strategy to work, China needs transportation infrastructure linking China to the ports. This means extensive rail and road systems. The difficulty of building this in Myanmar, for example, should not be underestimated.

But more important, China needs to maintain political relationships that will allow it to access the ports. Pakistan and Myanmar, for example, have a degree of instability, and China cannot assume that cooperative governments will always be in place in such countries. In Myanmar's case, recent political openings could result in Naypyidaw's falling out of China's sphere of influence. Building a port and roads and finding that a coup or an election has created an anti-Chinese government is a possibility. Given that this is one of China's fundamental strategic interests, Beijing cannot simply assume that building a port will give it unrestricted access to the port. Add to this that roads and rail lines are easily sabotaged by guerrilla forces or destroyed by air or missile attacks.

In order for the ports on the Indian Ocean to prove useful, Beijing must be confident in its ability to control the political situation in the host country for a long time. That sort of extended control can only be guaranteed by having overwhelming power available to force access to the ports and the transportation system. It is important to bear in mind that since the Communists took power, China has undertaken offensive military operations infrequently -- and to undesirable results. Its invasion of Tibet was successful, but it was met with minimal effective resistance. Its intervention in Korea did achieve a stalemate but at horrendous cost to the Chinese, who endured the losses but became very cautious in the future. In 1979, China attacked Vietnam but suffered a significant defeat. China has managed to project an image of itself as a competent military force, but in reality it has had little experience in force projection, and that experience has not been pleasant.

Internal Security vs. Power Projection
The reason for this inexperience stems from internal security. The People's Liberation Army (PLA) is primarily configured as a domestic security force -- a necessity because of China's history of internal tensions. It is not a question of whether China is currently experiencing such tensions; it is a question of possibility. Prudent strategic planning requires building forces to deal with worst-case situations. Having been designed for internal security, the PLA is doctrinally and logistically disinclined toward offensive operations. Using a force trained for security as a force for offensive operations leads either to defeat or very painful stalemates. And given the size of China's potential internal issues and the challenge of occupying a country like Myanmar, let alone Pakistan, building a secondary force of sufficient capability might not outstrip China's available manpower but would certainly outstrip its command and logistical capabilities. The PLA was built to control China, not to project power outward, and strategies built around the potential need for power projection are risky at best.

It should be noted that since the 1980s the Chinese have been attempting to transfer internal security responsibilities to the People's Armed Police, the border forces and other internal security forces that have been expanded and trained to deal with social instability. But despite this restructuring, there remain enormous limitations on China's ability to project military power on a scale sufficient to challenge the United States directly.

There is a disjuncture between the perception of China as a regional power and the reality. China can control its interior, but its ability to control its neighbors through military force is limited. Indeed, the fear of a Chinese invasion of Taiwan is unfounded. It cannot mount an amphibious assault at that distance, let alone sustain extended combat logistically. One option China does have is surrogate guerrilla warfare in places like the Philippines or Indonesia. The problem with such warfare is that China needs to open sea-lanes, and guerrillas -- even guerrillas armed with anti-ship missiles or mines -- can at best close them.

Political Solution
China therefore faces a significant strategic problem. China must base its national security strategy on what the United States is capable of doing, not on what Beijing seems to want at the moment. China cannot counter the United States at sea, and its strategy of building ports in the Indian Ocean suffers from the fact that its costs are huge and the political conditions for access uncertain. The demands of creating a force capable of guaranteeing access runs counter to the security requirements inside China itself.

As long as the United States is the world's dominant naval power, China's strategy must be the political neutralization of the United States. But Beijing must make certain that Washington does not feel so pressured that it chooses blockade as an option. Therefore, China must present itself as an essential part of U.S. economic life. But the United States does not necessarily see China's economic activity as beneficial, and it is unclear whether China can maintain its unique position with the United States indefinitely. Other, cheaper alternatives are available. China's official rhetoric and hard-line stances, designed to generate nationalist support inside the country, might be useful politically, but they strain relations with the United States. They do not strain relations to the point of risking military conflict, but given China's weakness, any strain is dangerous. The Chinese feel they know how to walk the line between rhetoric and real danger with the United States. It is still a delicate balance.

There is a perception that China is a rising regional and even global power. It may be rising, but it is still far from solving its fundamental strategic problems and further yet from challenging the United States. The tensions within China's strategy are certainly debilitating, if not fatal. All of its options have serious weaknesses. China's real strategy must be to avoid having to make risky strategic choices. China has been fortunate for the past 30 years being able to avoid such decisions, but Beijing utterly lacks the tools required to reshape that environment. Considering how much of China's world is in play right now -- Sudanese energy disputes and Myanmar's political experimentation leap to mind -- this is essentially a policy of blind hope.

 

[Edward Campbell]

While the three factor at the beginning are fine, if a little sketchy, I think that STRATFOR author is grasping at straws with the Pakistan/Tibet scenarios: as (s)he correctly points out neither China nor India is interested.

As to Xinjiang ~ a couple of years ago a mid level Chinese official put it to me that they, the (mostly) Han Chinese, plan to "f__k Xinjiang into submission." He meant that young men are encouraged to go to Xinjiang and marry a mostly relatively poor, attractive Uyghur girl and raise a totally secular, modern Chinese family. It may be the work of a few generations but my acquaintance was confident of the strategy. 

 

[sean m]

@ Mr. Campbell,

Yes, as you say the author does point out that fact in regards to Tibet. Yet do you or anyone else think that this weakness in Tibet or Xinjiang could turn into an opportunity for someone to attack China if they desired to? "For India, an independent Tibet without Chinese forces would be interesting", can anyone speculate how an independent Tibet would be interesting for India? In regards to Xinjiang, do you or anyone feel that what you contact is saying is accurate that the Uyghur people are really going to allow this to happen to their people? Maybe since  the Uyghurs are ethnically Turkic, and  they seem to mostly be of the islamic faith. Maybe a community whose is ethnically and religiously different from the Han or any other ethnic group in China, would be less inklind (maybe) to marry into a people they view as opressors. This quote "China's second strategic concern derives from the first. China's industrial base by design produces more than its domestic economy can consume, so China must export goods to the rest of the world while importing raw materials. The Chinese therefore must do everything possible to ensure international demand for their exports. This includes a range of activities, from investing money in the economies of consumer countries to establishing unfettered access to global sea-lanes", is interesting since someone could possible develop the notion that, China is as desperate for trade with us as we are for them. It seems like there are individuals in the business world who seems to state that we are in more need for trade with China than visa versa, just an opinion. Maybe the divide between inner and the coastal region of China could get worse if both sides receive what they want or need, perhaps? "The key for China is maintaining interior stability. If this portion of Han China destabilizes, control of the buffers becomes impossible. Maintaining interior stability requires the transfer of resources, which in turn requires the continued robust growth of the Chinese coastal economy to generate the capital to transfer inland. Should exports stop flowing out and raw materials in, incomes in the interior would quickly fall to politically explosive levels. (China today is far from revolution, but social tensions are increasing, and China must use its security apparatus and the People's Liberation Army to control these tensions.)" from what the author is saying it seems that China has a lot of tensions which could spiral out of control and become started in a short period of time, do you or anyone concur with this statement? "For the Chinese, this represents a strategic challenge, a challenge that can only be countered by increasing the profitability on Chinese economic activity. This is nearly impossible for low value-added producers. The solution is to begin manufacturing higher value-added products (fewer shoes, more cars), but this necessitates a different sort of work force, one with years more education and training than the average Chinese coastal inhabitant, much less someone from the interior." This statement seems to infer that China needs to educate it's population a lot more in order to be more productive in the production of more quality goods and services, does anyone believe that since China relies more on foreign investment and purchasing of quality goods- services and businesses, that it could put them in a more precarious situation due to their domestic issues in this regard? Maybe this could be an advantage for us since they require quality goods and services from us and it seems that we what is keeping the coastal and mainland regions of China from spiralling out of control. In regards to the military portion of the article do you or anyone agree with the author?

 

[GAP]

Sean m you may have had a point in that last post, but I defy anyone to try and follow it......it's just a block of words, little punctuation, sentence and paragraph structure.....couldn't be bothered trying...........

 

[Edward Campbell]

Let me see if I can find or make any sense of your post:

@ Mr. Campbell,

Yes, as you say the author does point out that fact in regards to Tibet. Yet do you or anyone else think that this weakness in Tibet or Xinjiang could turn into an opportunity for someone to attack China if they desired to?

Have you looked at the geograrphy of China and its neighbours? The LoCs are pretty tough.

"For India, an independent Tibet without Chinese forces would be interesting", can anyone speculate how an independent Tibet would be interesting for India?

It would pose a potential problem re: the large Tibetan Buddhist minority in India and it might destabilize China, itself, thus creating unnecessary risk for India.

In regards to Xinjiang, do you or anyone feel that what you contact is saying is accurate that the Uyghur people are really going to allow this to happen to their people? Maybe since  the Uyghurs are ethnically Turkic, and  they seem to mostly be of the islamic faith. Maybe a community whose is ethnically and religiously different from the Han or any other ethnic group in China, would be less inklind (maybe) to marry into a people they view as opressors.

Maybe, indeed, my contact was, I suspect, counting on greed, especially amongst poor Uyghur women, to help the project along. Anecdotal evidence seems to suggest (notice how indefinite I am being) that many Uyghur women are quite willing to marry Chinese men and to renounce their faith to get a better life.

This quote "China's second strategic concern derives from the first. China's industrial base by design produces more than its domestic economy can consume, so China must export goods to the rest of the world while importing raw materials. The Chinese therefore must do everything possible to ensure international demand for their exports. This includes a range of activities, from investing money in the economies of consumer countries to establishing unfettered access to global sea-lanes", is interesting since someone could possible develop the notion that, China is as desperate for trade with us as we are for them. It seems like there are individuals in the business world who seems to state that we are in more need for trade with China than visa versa, just an opinion.

There is no question, it is a symbiotic relationship ~ as are all successful trading relationships. What is interesting, in the strategic calculus is that America is burdened with, inter alai, providing "freedom of the seas" for China because America has other, pressing strategic interests that require it to provide that 'service' for all.

Maybe the divide between inner and the coastal region of China could get worse if both sides receive what they want or need, perhaps? "The key for China is maintaining interior stability. If this portion of Han China destabilizes, control of the buffers becomes impossible. Maintaining interior stability requires the transfer of resources, which in turn requires the continued robust growth of the Chinese coastal economy to generate the capital to transfer inland. Should exports stop flowing out and raw materials in, incomes in the interior would quickly fall to politically explosive levels. (China today is far from revolution, but social tensions are increasing, and China must use its security apparatus and the People's Liberation Army to control these tensions.)" from what the author is saying it seems that China has a lot of tensions which could spiral out of control and become started in a short period of time, do you or anyone concur with this statement?

Yes, China, like France, for example, has a lot of internal tensions which can, quickly, flare up into civil unrest. The spread of TV, it is ubiquitous in China, allows everyone to see what live is supposed to be like in the prosperous East coast provinces - everyone wants the same, rather like poor black kids in American ghettoes want what they see on TV. The social problems in China should not be minimized, nor should the capacity of the Chinese system to respond to the popular will. The problem all oligarchies have is keeping a "finger on the pulse" of public opinion.

"For the Chinese, this represents a strategic challenge, a challenge that can only be countered by increasing the profitability on Chinese economic activity. This is nearly impossible for low value-added producers. The solution is to begin manufacturing higher value-added products (fewer shoes, more cars), but this necessitates a different sort of work force, one with years more education and training than the average Chinese coastal inhabitant, much less someone from the interior." This statement seems to infer that China needs to educate it's population a lot more in order to be more productive in the production of more quality goods and services, does anyone believe that since China relies more on foreign investment and purchasing of quality goods- services and businesses, that it could put them in a more precarious situation due to their domestic issues in this regard? Maybe this could be an advantage for us since they require quality goods and services from us and it seems that we what is keeping the coastal and mainland regions of China from spiralling out of control. In regards to the military portion of the article do you or anyone agree with the author?

There is a always a market for new, innovative goods and services in China ~ just as there is in America, Brazil, Canada, etc, etc ... The Chinese education system is still evolving, as is our (I hope); the Chinese appear happy with their relative mastery of technical learning but they want to introduce greater creativity without sacrificing what they already do well. Their perception is that America squandered its global lead on technical skills and knowledge in pursuit of "self actualization" and so on.

See how easy paragraphs are, Sean? Just a simple "RETURN" at the end of each idea makes your post comprehensible - something it was not in its original form.