Tag Archives: China

Beijing Is Tempting Fate | The Diplomat

Recent flybys continue a disturbing pattern of aggression based on dangerous assumptions.

Why are Chinese forces acting so recklessly? The fact that Chinese military officers are repeating the same behaviors over and over again suggests that these are not the acts of hot-dogging mavericks. The actions, rather, are part and parcel of China’s strategy to gain control of its near seas and change norms of behavior in international waters and airspace off China’s coast. If the PLA makes it dangerous for U.S. and Japanese forces to operate as they always have, the thinking goes, perhaps they will cease to do so.

China’s “I dare you” policy rests on several assumptions. First, China assumes that its rivals are more eager than it is to avoid deadly accidents. Second, and similarly, China assumes that its rivals are more intent on avoiding actual conflict. Third, China assumes that the Japanese and American militaries in particular, due to their training and experience, can be counted on to exercise self-restraint in the face of Chinese taunting.

China is intentionally using its forces in a way designed make a clash or mishap more likely, while counting on others to ensure such an eventuality is avoided. Put simply, Beijing is tempting fate. Will Xi Jinping recognize this is folly before his good fortune runs out?

Beijing Is Tempting Fate | The Diplomat

China No-Money-Down Housing Echoes U.S. Subprime Loan Risks – Bloomberg

China’s home buyers are being offered no-money-down purchases in an echo of the subprime lending that triggered a U.S. economic meltdown and the global financial crisis.

Deals skirting government requirements for minimum 30 percent down payments have emerged this year from Guangzhou and Shenzhen in the south to Beijing in the north as real-estate sales slump, according to state media and statements by government agencies and developers.

Loosening down-payment requirements could erode China’s financial stability by adding to risks for property companies, lenders and an economy already heading for the weakest growth in 24 years. Government warnings to consumers indicate that officials will strive to limit such arrangements, a sign of stress in a property market with a glut of homes.

China No-Money-Down Housing Echoes U.S. Subprime Loan Risks – Bloomberg

China Slowdown To Hit Asia Hard | The Diplomat

Growth in China, the world’s second-largest economy, is forecast to slow to 7.6 percent this year and 7.5 percent in 2015, with the rebalancing process remaining “slow and volatile.”

However, the bank warned that a sharper than expected slowdown in China driven by a slump in property prices and “disorderly deleveraging” could lead to a significant fall in investment and output growth and substantial spillovers within the region, “especially on commodity exporters.”

The prospects of a slowdown have increased following research by Gan Li of Texas A&M University estimating that there are 49 million homes currently vacant in China. The professor has calculated the vacancy rate at 22.4 percent, double previous estimates, and a worrying sign given that the property sector makes up 13 percent of the economy.

The U.S. vacancy rate peaked at 13 percent in 2009 after the bursting of its property bubble, which triggered the sub-prime mortgage crisis.

“Once expectations change, the high vacancy rate will put lots of pressure on prices and could see them collapse,” Li told the Australian Financial Review. “A cold winter for the Chinese housing market is coming.”

China Slowdown To Hit Asia Hard | The Diplomat

Video – Behind U.S.-China bickering, Author Hugh White Sees Risks of War – WSJ.com

Hugh White’s view that America and China are on a collision course is looking more prophetic, but not everybody agrees with his ideas for compromise. The WSJ’s Andrew Browne has the details.

Video – Behind U.S.-China bickering, Author Hugh White Sees Risks of War – WSJ.com

Hugh White believes that war is a distinct possibility.

Xi and Putin think the West is weak | GulfNews.com

By and large, though, they have a shared assessment of the weakness of the west. Obama’s bromides about leadership, Xi would have remarked, failed to grasp China’s intention to upturn the present US-designed order. The president’s much vaunted “pivot to Asia” had made life a little more complicated for Beijing. Washington also had measurable military superiority. But China understood that power resides in a willingness to deploy it.

Just as Putin had changed the facts on the ground in Ukraine Xi calculated China could change them in the waters of the western Pacific. Given US diffidence, collisions with neighbours such as Japan, Vietnam, the Philippines over competing maritime claims in the East and South China Seas served two purposes. They at once demonstrated China’s resolve and Washington’s weakness. As for Europe, it was scarcely worth mentioning so easy did Beijing find it to play divide and rule.

We cannot be sure, of course, this conversation took place, but it is as well to look through the other end of the telescope from time to time. Last week William Hague, Britain’s foreign secretary, told the inaugural London Conference hosted by Chatham House that the world was not simply going through a difficult patch, but had entered a period of “systemic disorder”. Put another way, the advanced democracies of the West have a rough ride ahead.

Xi and Putin think the West is weak | GulfNews.com

David Feith: China’s Timely Power Play – WSJ

On the sidelines of this week’s Shangri-La Dialogue, Asia’s leading annual security conference, diplomats and policy experts largely agreed on two points. First, China sees the remaining Obama years as an opportune time to keep pushing for dominance in the Western Pacific. And second, China hurts itself with the sort of bluster it displayed at the conference, essentially daring its weaker neighbors to seek U.S. help.

Yet the first point undermines the second: As Washington seeks primarily to minimize overseas commitments, it isn’t well-suited to help its Asian friends resist Chinese bullying. So Beijing’s bluster may seem short-sighted, but it is perfectly rational. Intimidating the neighbors is most effective when America is ambivalent about whether to lead a forceful response.

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China seems to have bet likewise in the South China Sea, that now is the time to bully and bluster because the U.S. response will be limited. Unless the Obama administration changes that calculus, Beijing is making a rational play.

David Feith: China’s Timely Power Play – WSJ

Expert: US Should be Blamed for China-Vietnam Row – People’s Daily Online

However, the situation changed drastically with US assistant secretary of state for East Asian and Pacific affairs Daniel Russel’s visit to Vietnam on May 7. With open support from US, Vietnam raised its tone against China and speculated the incident by holding press conferences and sending more ships to interrupt China’s operations; later it even connived in domestic protests against Chinese enterprises, which finally resulted in casualties of Chinese citizens and huge damage to Chinese enterprises in Vietnam.

In the evolution from territorial disputes to friction then to bloodshed, a third party US’ role is evident. It is obviously using dispute between China and Vietnam and other disputes in South China Sea to contain China.

Expert: US Should be Blamed for China-Vietnam Row – People’s Daily Online

China Refuses to Defend its South China Sea Claims to UN Court – Businessweek

China refused to defend its territorial claims in the South China Sea to a United Nations tribunal because it doesn’t recognize international arbitration of its dispute with the Philippines.

“China’s position that it will not accept or participate in the tribunal case involving the Philippines hasn’t changed,” Foreign Ministry Spokesman Hong Lei said in Beijing today.

The UN’s Permanent Court of Arbitration announced yesterday it was giving China until Dec. 15 to respond to the complaint by the Philippines filed in March, when it asked the court to uphold its right to exploit waters within its 200-nautical mile exclusive economic zone. So far China has refused any international efforts to resolve the dispute, insisting any discussions on the issue must be held directly between China and the Philippines.

China Refuses to Defend its South China Sea Claims to UN Court – Businessweek

History Is a Weapon in China – Bloomberg View

For China’s autocrats, history is a weapon. This past weekend, for example, a Chinese general told Southeast Asian nations that their territorial claims in the South China Sea were irrelevant because “China has had indisputable sovereignty over the South China Sea for around 2,000 years,” reported the state-owned CCTV network. Don’t like it? Then learn to “respect history” as China’s Defense Minister told his Vietnamese counterpart in late May, after Vietnamese protesters turned violent in response to Chinese incursions into what Vietnam considers its territory. In this context, history is the rhetorical equivalent of a dismissive wave of a hand that brings an end to a pointless conversation.

In China’s ongoing dispute with Japan over territory and the right to be respected as Asia’s dominant power, history is used more as a cudgel. Japanese leaders themselves have handed Beijing the weapon, with their highly provocative visits to the Yasukuni Shrine, which honors Japan’s war dead (including 14 Class-A war criminals), as well as their determined efforts to finesse Japan’s wartime conduct in school textbooks. For Chinese officials, these acts are affronts, as well as opportunities to lower Japan’s standing in the international community.

History Is a Weapon in China – Bloomberg View

The biggest story since the end of the Cold War: China’s new anti-West axis | City A.M.

To see that this deal is first and foremost about geopolitics is critical. During Putin’s brief visit to Shanghai last month, Xi proposed a new regional Asian security organisation, including Russia, Turkey, and Iran, but excluding the US. Moscow and Beijing also engaged in joint military exercises off the Chinese coast. In other words, the gas deal was simply part of a larger Sino-Russian diplomatic gambit – admittedly still in its very early stages – presenting the first real geopolitical challenge to the United States in a generation.

What we witnessed was the fledgling creation of a new anti-western axis, with China as its leading light, but with potentially enough heft to do nothing less than challenge Western dominance over the medium term.

If this is so, it amounts to the biggest geopolitical story since the end of the Cold War. For such a tie-up undoes the brilliance of Henry Kissinger and Richard Nixon going to China in 1972, wherein (and despite the Vietnam calamity) America managed to become closer to its two main competitors – China and the USSR – than they were to each other, thus ensuring US dominance. Or in shorthand, Putin to Shanghai undoes Nixon to China. If China and Russia find general common cause and move closer to each other than either is to America, the global chessboard is irrevocably altered.

The biggest story since the end of the Cold War: China’s new anti-West axis | City A.M.

Monitoring emerging risks.