The effects of Chinese stock market lows last week are illustrative of its self-sufficiency; the country no longer needs Western demand for cheap labour and manufacturing for economic growth. Instead, a centrally-regulated financial sector and vast amounts of foreign investment are the foundations for a sustainable, globalised economy.
Repeated rebuffing of trade and diplomatic missions, like the UK’s embarrassing Macartney mission in 1793 as one of many examples, proves that China has never intended to industrialise on Western terms. Up to 1820, China contained 30% of the world’s GDP in its own subsistent cycle, showing that it really didn’t have to. Even though the country has joined the market out of economic necessity, this singularity prevails. There is a scene in the West End play Chimerica, in which a sales analyst explains why McDonald’s succeeded in China and ebay did not. The answer: ‘glocalisation’. Ebay tried to sell the West, while McDonald’s adapted to Chinese tastes; at a McDonald’s on the mainland, you can sip on a refreshing Oolong Freeze.
Initiating the Asian Infrastructure Investment Bank and the ‘One Belt, One Road’ global investment strategy are signs that China is ready to become a global power on its own terms. China currently has $1.1 trillion of infrastructure investments and projects overseas. In Mongolia, the capital city brims with construction. Half-formed high-rises edge onto the desert; an empty American-style cul-de-sac stands expectantly on the sand. The country was the world’s fastest growing economy in 2011, and this growth pervades the atmosphere in Ulaan Baatar. This is owed largely to investment in natural resource projects and exports in oil, iron ore, coal and copper by its neighbour. The country’s reliance on China for commodities exports means that stock market fluctuations affect its fragile rise; Dale Choi, director of a Mongolian commodities research firm, explains: ‘When China sneezes, we get a cold. That is how the situation is. It really affects us in a major way.’ Meanwhile my host explains to me that, despite the benefits, there is an underlying feeling of exploitation among her friends.
This sentiment is echoed by a political slogan in Namibia, condemning investment agreements as a ‘raw deal’. Opposition leaders such as Michael Sata in Zambia use Sino-skepticism to gain ground. China is the continent’s largest trading partner, with more than 2000 companies investing mainly in energy, mining, construction and manufacturing, and increasingly in finance, aviation, agriculture and tourism. Despite the financial advantages this brings to trading partners, resentment is growing over corrupt business practices, cultural insensitivity, low quality of work and competition harming local enterprises. Poor working conditions sparked protests in the Zambian town of Sinazongwe, which were met by shotgun fire by Chinese managers. This is an extreme example of how the conditions sparking China’s own rise have been transferred to their work abroad. It is difficult to know how these countries would be faring without Chinese involvement, but employment has undoubtedly increased since investment began. Still, to make a profit, China has to undercut the minimum wage in some countries to cheapen labour, provoking references to exploitation and colonialism.
However, it seems imperialist to suggest that countries cannot make sensible decisions for themselves. Chinese investment generates growth and jump-starts lasting industry, even if the foundations are slightly shoddy. The intent is to generate profit, not to acquire colonial lands. However, withholding judgment on developing economies’ decisions does not mean we should engage with Chinese investment to the same extent. In October, Xi Jinping extended ‘One Belt, One Road’ to Britain, contributing to Hinkley Point C, HS2, property projects, the City and cultural exchanges. The UK does need a significant infrastructure boost, particularly in energy, and the agreements will help to raise flagging statistics. However, the point remains that the taxpayer will be funding these projects, some of which are controversial in themselves. While France could no longer sustain its stake in the Hinkley nuclear plant as a main developer, it is difficult to believe that China was the only alternative. Low interest rates mean it is a particularly good time to borrow, yet the UK are offering disproportionately good rates to state-owned China General Nuclear Power Corporation for its £6bn investment, to the extent that the deal comes across diplomatic rather than desperate. Protests at Xi Jinping’s visit demonstrate that some UK citizens object to supporting the country’s undeniable human rights violations. The atrocities against Uighurs and Tibetans are not culturally relative; even as we respect the rise in living standards for Chinese people in the last few decades, imperialist guilt should not silence criticism of China’s methods for growth.
Existing UK trade deals demonstrate that human rights records are not a priority in commerce. However, our government should strongly consider the effects of the message that recent agreements send to officials and the wider world. There are many other countries offering economic and diplomatic opportunities for the UK; we should not let China’s impressive growth and rising influence cloud our judgment.
Charlotte Baker, Philosophy, Politics & Economics