China’s global ambition
In a recent TV documentary on the ‘Belt and Road’ phenomenon, Christoph Trebesh, a researcher at the Kiel based Institute for World Economy, explained: “It is driven by opaque, state-owned entities using market-based loan terms at high rates of interest and with strings attached, such as revenue from oil or copper sales”. China lends more money, he maintained, than the next richest 32 nations combined. It is “no different from other colonial powers, extending their power through trade, finance and the military”.
By 2017, the Belt and Road was enshrined in the constitution of the People’s Republic of China. It is not a totally new idea. It harks back to China’s long history as a trading nation and the ‘Silk Road’ that took its unique fabric to Europe, stretching from the Pacific to the Atlantic. The ‘Belts’, Maçães explains, consist of six economic ‘corridors’ on land and the ‘Roads’ are three sea routes. “The land element is called a belt to pinpoint that its ultimate goal is the creation of a densely integrated economic corridor rather than a transportation network linking two points”.
The communications, investments and loans that link China to Europe and South East Asia are already well developed. This “supercontinent” stretches from Lisbon to Jakarta, includes India – and encompasses two-thirds of the world’s population and global economic output. His central contention is that “whoever is able to build and control the infrastructure linking the two ends of Eurasia will rule the world”.
“The Belt and Road is the Chinese plan to build a new world order replacing the US-led international system”. This is the essence of the modern-day Thucydides trap that so many commentators are now referring to – when Sparta feared the rise of Athens and went to war. The USA’s dominant position in the world is undoubtedly under threat, a threat that the US ruling class will attempt to repel. It is by no means a certainty as to who wins.
China has grown rapidly to become the number one global rival of the USA, even in its own back yard – Latin America. This book does not cross the Atlantic but, as an article in the New York Times explained in April this year, China “has become the top trading partner of major economies including Brazil, Chile, Peru and Uruguay. Since 2017, 19 nations in the region have signed on to the Chinese government’s Belt and Road Initiative, a multi-billion dollar network of investment and infrastructure projects”.
Bruno Maçães wrote this book in 2018 just as the trade war between the US and China was accelerating. “The ongoing dispute was initially centred around the country’s trade deficit with China but quickly turned to ‘Made in China 2025’,” he explains. “The confrontation started on April 3, 2018, with the US proposing 25% in added duties on 1,300 Chinese products, such as industrial robots and other machinery. This would impact $50 billion or 10 per cent of total US imports from China”.
The book is now particularly relevant in today’s atmosphere of accelerating tensions, measures and counter-measures, sometimes described as a ‘cold war’, between capitalism’s geopolitical giants, which make the ‘truce’ signed in January this year appear meaningless. Donald Trump has said “we could cut off the whole relationship!” and talks of cancelling all dealings with Huawei – in an attempt to cripple the world’s largest telecom equipment company and leader in 5G mobile technology. Trump does not speak for the entire US ruling class, but many sections want to see action taken to limit China’s rise.
At the beginning of his book, Bruno Maçães, who was Portugal’s Europe Minister from 2013 to 2015, refers to China’s long history as a trading nation stretching back millennia but says little about the hundred ‘lost’ years spent under the jackboot of Western and Japanese imperialism – the ‘years of humiliation’. Nor does he mention much about the decades following the victory of the revolution led by Mao Zedong in 1949 or the policies of Deng Xiaoping that changed the direction of China’s economic policy from the late 1970s.
He does give some stark statistics for China’s spectacular growth rates in the most recent period. “Whereas Great Britain took 154 years to double industrial output per person and the United States fifty-three years, China and India have taken just twelve and sixteen years respectively, and both with one billion people”.
The size of China’s economy in purchasing power parity terms is now as great as that of the US. But this by no means implies that living standards are comparable. Premier Li Keqiang has just admitted that more than two-fifths of the population – 600 million Chinese – are having trouble maintaining a basic living standard. With the huge blow to the economy inflicted by the coronavirus, this can be a cause of major problems for some time.
In recent years, as China shed many of the elements of a state-owned, planned economy, individuals, well placed in the ruling ‘Communist’ Party, became owners of large swathes of banking and industry and grew rich… very rich. There are more than 300 billionaires or mega billionaires owning fast cars, luxury yachts and villas abroad, sending their children to European and US schools and universities.
The present general secretary of the ruling party and the country’s ‘president for life’, Xi Jinping, holds enormous power and is surrounded by compliant politburo members, keenly aware that their privileged position could be brought suddenly to an end in one of the periodic anti-corruption campaigns that Xi conducts. In a way, the whole system is corrupt.
Public and state
The exact relationship between private, public and state ownership of companies is shrouded in mystery. The Chinese economy is now said to be 60% privately owned. In 2016 Maçães wrote for Carnegie Europe that “most large Chinese multinationals are not simply state-owned but are effectively managed with a view to goals and strategies defined outside the company and through political channels”.
The state capitalism of China is certainly of a very special kind. The memory of the ‘great leader’ of the 1949 revolution, Mao Zedong, is kept alive in spite of his fall from grace towards the end of his life, in order to maintain the myth that the present regime continues on a path to socialism from capitalism and landlordism.
Mao and the CCP leadership, basing their rule on the example of the Stalin clique in the then Soviet Union, established a planned nationalised economy while suppressing any form of workers’ democracy. But by the 1970s bureaucratic rule was stifling the economy and a section of the Chinese leadership allowed the re-emergence of capitalism in an attempt to overcome stagnation. This was the starting point of what became the state capitalist regime that exists today, a regime that still calls itself ‘Communist’ and declares ‘socialism’ to be its goal in an attempt to retain legitimacy in the eyes of the population.
The Chinese state acts to defend elite rule utilising names associated with the struggles of the first half of the twentieth century. The more than two million strong army in China is called the ‘People’s Army’, the state, the ‘People’s Republic’.
The ‘Communist Party’ and its subservient trade unions have a network of local members who virtually police the neighbourhoods, villages and workplaces. There are no free elections, no free press or media, frequent jailings and disappearances of critics of the government. Whole nations are suppressed, not least the Uighurs of Xinjiang in the west of the country. Semi-independent Hong Kong is now threatened with complete domination from Beijing.
Foreign policy is always an extension of national politics. Maçães gives a detailed picture of the way the ‘Belt and Road’ initiative has been driven forward, trampling on local sensitivities and interests. He enumerates the problems the essentially imperialistic grand plan has come up against literally along the way.
He describes a determined strategy to build ports, trade parks, rail and road routes and highways as well as seaways across Eurasia and into Africa. This is power politics on a grand scale while involving huge elements of state lending and investment, paving the way for private as well as state-financed Chinese ventures to expand and capture world markets – literally striding the globe like a colossus.
China has built new ports stretching from Hambantota in Sri Lanka, through to Gwadar in Pakistan. The project in Gwadar now involves the building of a $10 billion model city. “A quiet fishing village may soon become a new Dubai”. As elsewhere, such a city exemplifies the ‘combined and uneven development’ described by Leon Trotsky in his work Permanent Revolution. So too does the Belt and Road project in Pakistan with the most modern of technology being used building bridges and railways through the countryside where semi-feudal relations of obeisance to prosperous landowners still hold sway.
The rapid construction of a container port in Doraleh, Djibouti saw China actually force an already existing rival port out of existence and establish not only a massive container terminal but China’s first overseas military base. The ‘People’s Republic’ has designs on African countries and their natural and human resources – the projected building of a rail link from Djibouti through Cameroon to Nigeria is nothing short of a neo-colonialism of a very special kind.
China, like any imperialist power, is out to dominate markets and grab precious raw materials vital to the production and sale of Chinese products. About 54% of the global supply of cobalt for batteries comes from the Congo. Chinese imports from there in 2017 totalled $1.2 billion and the second biggest importer, $3.2 million. Maçães writes: “China is not interested in producing batteries. It wants to control the electric vehicles market…Who rules the electric car market commands the world”.
For many years China has had pre-eminence in shipping and container ports. Now new ambitions to dominate trade routes are tied to the opening up of a ‘Northern Road’ through Siberia and the Arctic to northern Europe.
Maçães speaks of the Chinese state’s Machiavellian methods of building allies within the EU, including amongst reactionary regimes in Hungary and some of the former Stalinist states of Eastern Europe. It has established vast business interests in the Mediterranean – in Greece, Italy, and Turkey. Giant companies like Alibaba challenge Amazon in the European battlefield.
It is no coincidence that the Belt and Road project was announced during a speech that Xi Jinping gave to university students in Kazakhstan in 2013. It was an obvious place to start a drive through Central Asia, exploiting the country’s precious natural resources, setting up vast industrial and trading hubs, taking advantage of a dictatorial political system and employing small armies of English ‘experts’.
In China’s ‘home’ region of South East Asia, there are long-standing tensions over China’s control of the vital Malacca Straits amongst other issues. Many rival projects established by Japan, ‘flying under the radar’, actually exceed those of China. India’s role as defender of smaller nations in its orbit is a complication for China as well as longstanding border conflicts between them. India regards the China-Pakistan corridor as a major threat to its national security.
“For South China littoral states”, writes Maçães, “the spectre of Chinese naval and coast-guard assets patrolling vital shipping sea lanes and waters adjacent to these ports may actually dissuade them from participating in the scheme lest it be seen as jeopardising their own territorial and maritime claims”.
Clashes are inevitable. China’s relations with governments abroad has nothing in common with socialist internationalism, let alone the higher stage of socialism known as communism, which it professes, totally hypocritically, to be moving towards at home. If anything, China’s relations with its hundreds of creditor countries and firms around the world are another, higher stage of imperialism!
China sees under-developed economies as virtual colonies hooked up to its superior political and economic power. They provide raw materials on the cheap, a market for Chinese technology and goods, and are forced to repay loans at interest rates even higher than those demanded by western imperialism through the IMF and the World Bank!
During the Covid-19 crisis the Chinese authorities have made it clear that they may countenance a repayment ‘holiday’ but very few defaults, if any, on the hundreds of billions of dollars’ worth of loans to countries – half of which are considered high-risk debtors. In a number of countries, as Maçães himself points out, China takes real estate, assets, ports or airports as collateral.
Maçães, after declaring that “geopolitics has triumphed”, writes that “blowback against the Belt and Road followed almost immediately upon its initial successes”. He lists opposition from the US and India and a range of South Asian countries pushing back against Chinese capitalism’s ambitions including Malaysia, Indonesia, Vietnam and Myanmar. Some proposed schemes have been rejected as too exploitative or downright insulting. In some cases, Chinese labour has been ‘imported’ rather than employ local workers. Little wonder that anti-Chinese sentiment has deepened.
Huge tensions have developed between China and Australia – a country extremely dependent on China for trade and investment. Australia and New Zealand have both complained about political interference and there has been blatant Chinese financing of reactionary political forces in Sri Lanka and elsewhere.
When it comes to the European end of the Belt and Road schema, China has made huge inroads into the market. “EU-Asia trade in goods is consistently more than double transpacific trade and as much as three times Transatlantic”. It involves giants like Alibaba and Huawei, joint ventures in Italy and elsewhere, and even high-speed railway developments.
As the present crisis has followed a decade of slow growth, some European powers aiming to protect their own industries have engaged in a war of words as a prelude to pulling out of deals wherever they can. Others like Italy and East European nations are content to take advantage of what appears to be a more friendly approach to loans and investment and see China as a counterweight to countries like the US, Germany and France.
New proxy colonial wars are in the process of formation as the big powers back different forces. A new inter-imperialist war between the two giants on the world stage is spoken of with some trepidation by serious capitalist commentators. Maçães well understands that “a war for hegemony” is rendered impossible by nuclear weapons. The use of ballistic missiles is not on the cards, but skirmishes, even bloody localised wars, can be envisaged in areas like the South China Sea.
Maçães sees all the potential points of conflict around the world, yet the last pages of his book are devoted to describing a utopia that comes out of the blue as a seamless progression from ‘Belt and Road’ to a space-age paradise! This is the author who links his narrative with the myths and legends of China’s past. It is also a fairy tale, a fiction that he bases on the idea of the rise of China as the most advanced civilised nation on the planet.
Despite its high growth rates up to now, it is not at all certain that China will overtake the US in terms of economic and even imperial might, but China is clearly capitalist in motivation and practice and this is the basis for rivalry and tensions between them. Capitalism means competition for markets and spheres of influence, it means oppression and wars.
Maçães is literally living in a dream world and glossing over all the conflicts and contradictions he has himself described. No wonder the book has in some quarters been classified as ‘history/fiction’. China may rival the US as a global imperialist power but this will not proceed without enormous conflict and cyclical crises that characterise capitalism on a world scale.
Maçães writes that “financial crises now decide the fate of nations, their rise and fall, and these critical moments for building the future have a way of arriving unannounced”. This was before the present devastating Covid-19 pandemic. The simultaneous crises in all the world’s major economies will test the viability of China’s Belt and Road project and Maçães’ contention that it will affect every element of global society, from shipping to agriculture, the digital economy to tourism, politics to culture.
The Belt and Road initiative is entirely geared to what’s in it for Chinese capitalism. Competition with foreign companies for raw materials and markets around the world inevitably brings it into conflict with governments – rival capitalist powers, above all the US, and smaller powers who resent the dominant role that China is playing in their own economies and in their politics. The author of this book speaks himself of “China’s neo-colonial designs” being enhanced by the onerous levels of debt mounting up in the comprador-ridden economies.
Far from a peaceful road to an ideal, capitalist world, the future holds a period of intense turmoil – ferocious struggles between the classes – exploited against exploiters, workers and poor against the bosses and landowners, nation-states against nation-states in intense now open, and now covert, battles for superiority and survival. Capitalism can only be swept from the planet by a movement of workers and young people on an international basis determined to see through a revolutionary struggle for socialism and genuine communism.
Only the defeat of capitalism in all its forms will establish a world order without barriers to the free movement of peoples from one side of the world to the other, without superior and inferior nations or classes – neither an American nor a Chinese world order. Communism means production according to everyone’s ability and distribution according to everyone’s needs. But a utopia can only be built on this planet on the basis of the common ownership of the means of production, distribution and exchange, of socialist democracy, democratic planning and decision-making in all spheres of life.
Reading Bruno Maçães book can open the reader’s eyes to the extent of China’s grand imperialist plan for the world. Reading Marxist and socialist material is vital for building a workers’ movement that fights to transform it.