Tag Archives: China

Who runs the world?

14 November 2012

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May be it is just because my adviser at some point studied the politics of language and identity (see here and here), but this morning over breakfast as I was watching the newly elected appointed successor of Hu Jintao as president of China give his inaugural speech to the press I was reminded of the continued soft (and hard) power of the English speaking North Atlantic world – or just simply the US.

In my opinion, it says a lot that the Chinese authorities felt the need to have a translator in the room, and for Mr. Xi Jinping to wait after every paragraph or so for the English translation to go through (they may have had translations to other languages as well, I was watching it live on the BBC).

Imagine the day when a newly elected US president, standing on the steps of the Capitol, gives a speech in English but has to wait every now and then for a Mandarin Chinese translation to go through.

I may be making too much of this. It all might have been a deliberate attempt to engage the rest of the world. As Time reports, Mr. Xi urged the press to facilitate more exchanges between China and the rest of the world:

But most of all, Xi was in a celebratory mood, advising the gathered press to do their part in furthering cross-cultural awareness. “Friends from the press, just as China needs to learn more about the world, so does the world need to learn more about China,” he said in a jocular tone. “I hope you will continue your efforts to deepen mutual understanding between China and the world.”

Language is very central to human interactions, and whoever has power over language usually has a lot of sway (as is argued in the books above). This morning someone won the politics of language. And it was not Beijing.

Where do the poor live, and how do we make them become middle class?

2 September 2012

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The Economist reports:

“WHERE do the world’s poor live? The obvious answer: in poor countries. But in a recent series of articles Andy Sumner of Britain’s Institute of Development Studies showed that the obvious answer is wrong. Four-fifths of those surviving on less than $2 a day, he found, live in middle-income countries with a gross national income per head of between $1,000 and $12,500, not poor ones. His finding reflects the fact that a long but inequitable period of economic growth has lifted many developing countries into middle-income status but left a minority of their populations mired in poverty. Since the countries involved include giants like China and India, even a minority amounts to a very large number of people. That matters because middle-income countries can afford to help their own poor.”

The article raises important issues that inform the debate on how to tackle problems of poverty and underdevelopment – is it all about politics & governance or all about economic expansion? The answer, of course is that it is a moderate mix of both.

But since political realities often force governments to concentrate on one or the other, a responsible answer is that it is all context-dependent; some places need strong economic expansion first, before political reforms can be anchored in society. In others, political change should be top of the checklist.

The Botswanas and Singapores of this world are lucky in that their leaders were smart enough to know what their countries needed and pursued it with singular ambition, despite the unavoidable mess that came with the choices they made.

This of course goes against the received wisdom among academics (me included) who believe in the strong power of the right types of (liberal, in the classical sense) institutions to put countries on the path to becoming Denmark. The problem with this approach is that it does not tell us how to compress the more than 600 years that transpired between the Magna Carta and the voting reform legislations in England in the latter part of the 19th century. Lest we forget, England (which is every scholar’s favorite source of empirical conceptualization of institutional development) has not always had good institutions.

Institutions take a lot of time to build. A lot more time than the average human life span.

So the question still stands: How do we get the most number of people out of poverty in the least amount of time with the least harm to their political and human rights?

More on this here.

All Roads Lead to Monopsony? Moyo on China’s Commodity Grab

25 June 2012

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Following the success of Dead Aid (which I enjoyed very much), Dambisa Moyo tried a repeat with Winner Take All – a book on China’s rising dominance of global commodity markets – with very little success.

The first half of Winner Take All is mostly a recount of statistics (most of which are already in the public domain) and general information on the state of the global commodity markets. It is not until the second half of the book that Moyo delves into the real issues regarding her subject matter – global commodities and China’s insatiable appetite for the same. But even then, the chapters are rather short on actual information on China and are instead full of comparative statics with the rest of the world (or more accurately, mostly the United States of America).

Moyo is not a China expert, and it shows in Winner Take All.

If you are looking for an indepth take of Chinese firms involved in the global commodity markets, their specific investments, strategies and relationships with the Chinese authorities, you will be disappointed. Moyo simply treats all of China as a single actor. There is no domestic politics. There is no discussion of redistributive concerns within China and how they will impact China’s economic performance. There is no nuance on the potential impact of China’s impending demographic decline (except in the concluding chapter). In the end the whole thing reads like it should be a special in the Atlantic Monthly rather than a stand-alone book.

The book, mistakenly, falls into the trap of Western declinism, suggesting that China will undoubtedly emerge to be the ultimate monopsonist in the global commodity markets (almost unchallenged). There is also loose talk of potential for conflict over resources – something that is contradictory to discussions in other sections of the book that emphasize the symbiotic relationship between China and the rest of the world.

The greatest strength of the book is its balanced take on the economic, political and social effects of the rise of China – especially with regard to Chinese investments in the rest of the world. The “Angola Model” of infrastructure-for-resources, discussed in the book, is far superior to the Swiss-accounts-for-resources model that has been the preserve of the West in many resource-rich developing countries over the last half century.

Winner Take All is a far cry from the provocative Dead Aid. It lacks a substantive discussion on the political economy of China’s economic rise (whether domestically or globally). Instead, it gives perspective (for those not in the know) of the implications of China’s economic rise.

Most importantly, it is also a welcome addition to the works of scholars like Deborah Brautigam who continue to remind us – and rightly so – that China’s economic adventures in the developing world have net positive benefits, despite the overwhelmingly negative press. For this reason I would recommend the book. 

14th of February Edition

14 February 2012

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Click to enlarge.

Source: http://benkling.tumblr.com/

H/T Paul G.

South Africa and the AU [Rant and rave alert!!]

31 January 2012

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As you may already know South African candidate for the AU Commission Chair Nkosazana Dlamini-Zuma (ex-wife of president Zuma) failed to get elected. Instead the AU extended Mr. Jean Ping’s term till June. Ms Dlamini-Zuma intends to vie for the seat again in June.

South Africa and its backyard (SADC member states) had lobbied hard for Ms Dlamini-Zuma.

The South African Business Day reports:

Mzukisi Qobo of the University of Pretoria says: “It is clear that this is an intensely divisive campaign, and plays into the hands of those who view SA as harbouring intentions of running roughshod over other countries. Unity in the AU is a facade reinforced by a poorly conceived notion of pan-Africanism.

“Africa’s political elites still think very much in terms of regional groupings — east Africa, north Africa, southern Africa and west Africa — as well as along the colonial lines of Francophone, Lusophone and Anglophone. These are realities that are there.”

SA’s foreign policy stance has been back and forth, which may have caused more divisions with countries like Nigeria and Egypt.

 But political analyst Steven Friedman does not think policy “flip-flopping” was the reason Ms Dlamini-Zuma did not get the post. With its economic infrastructure strength, other countries feared that SA would dominate Africa politically if given a chance, he says.

To which I say, why not?

What would be so wrong with a reasonably stable and important regional player taking charge of the rudderless dictators’ club institution that is the AU? The organization’s failures in the recent past – including in Libya, Sudan, Cote d’Ivoire, Somalia, Zimbabwe, DRC, Central African Republic, etc – have been partly because no single country has managed to emerge as its de facto leader and ultimate guarantor (forget the delusion late King of Kings, he was a clown on steroids).

Instead of having a strong leadership – whether by a single country or by a group of regional representatives – the AU has opted to have weak leadership in the form of a Commission headed by nondescript individuals political lightweights unable to rally the member countries to any respectable cause. The only time the club’s dictators are ever united is when they dump on the ICC and all other manner of foreign infringement on their “sovereignty” (which means the right to starve, jail or murder their citizens). The existing post of a rotating presidency has also been a complete sham. Obiang was the latest one to occupy the post. Yes, Teodoro Obiang Nguema Mbasogo of Equatorial Guinea. This guy.

May be this episode will end Pretoria’s navel-gazing and encourage it to focus on having a coherent Africa policy that will provide strong leadership for the AU.

A leaderless organization of 54 states, new $200m headquarters or not, is a useless organization.

For more on this see here and here.

Also, check out this thought-provoking piece on the symbolism of the new AU headquarters.

Human brutality timeline

6 November 2011

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The Times has a chat on the timeline of human brutality. Encouragingly, the overall picture appears to be that (compared to past periods) less people – as a percentage of the total – die from violence. Here is the Times on the top three most deadly human conflicts:

The savagery of the Mongol conqueror Genghis Khan may have culled the global population by about 11 percent; two bloody upheavals in China — the An Lushan Rebellion and the collapse of the Xin Dynasty — each may have felled about 6 percent of humanity. Those are but 3 of the 100 worst atrocities in history, as cataloged by Matthew White in “The Great Big Book of Horrible Things,” an amusing (really) account of the murderous ways of despots, slave traders, blundering royals, gladiators and assorted hordes.

More on this here.

What does a Sata Presidency Mean for Zambia?

2 October 2011

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UPDATE:

For a closer take on the Sino-Zambian connection check out Louise Redvers’ piece for the BBC.

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So the Economist beat me to writing about what a Sata presidency means for the Zambian economy, especially with regard to foreign investment.

For the two of you out there who are not conversant with the campaign details in the Zambian election, Mr. Sata’s main campaign strategy involved characterizing incumbent President Banda as someone who was out to mortgage Zambia’s future to foreign investors, and especially China.

Here is what the Economist had to say:

“He is too savvy a politician not to realise how much this impoverished country of 13m people needs China’s cash. Over the past decade, the Chinese have invested over $2 billion in Zambia, the GDP of which is only $16 billion. More than half of that came in last year. And China is committed to pouring in billions more. There are now about 300 Chinese companies in Zambia, most of them privately owned, employing around 25,000 locals. Standards differ: some companies treat their workers badly, but most of the big state-owned companies genuinely seek to respect local labour laws.”

The long and short of it is that Sata will definitely kick out a few shady companies that were operating outside the law – and these are not just Chinese firms; the South Africans and Australians also have some shady businesses in Zambia. The former, especially, have a lot of money-laundering operations.

More on this here and here.

On the democracy and governance front, things won’t change much. President Sata’s camp is full of recycled UNIP veterans. UNIP was the independence party that ruled Zambia between 1964 and 1991. Mr. Sata, however, could surprise us by finally passing through a new constitution for Zambia. The last parliament killed the proposed constitution.

The decline of odious ODA?

11 August 2011

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The Economist has a piece outlining the paradox of Indian overseas development assistance (to the tune of 11 billion over the next 5-7 years). With figures from the CIA factbook I have calculated that about 300 million indians live below the poverty line. The Economist piece also touts the emergence of middle income donors, especially among the BRICs.

In this world Europeans and Americans no longer dominate aid. China is the biggest source of investment in Africa and the Gates Foundation is as important as many donor governments (and much more innovative). Private capital flows to Africa outstrip aid flows, contradicting an old justification that aid is necessary because investors hold back.

For the poorest, the new donors are more important because Western aid is shrivelling. Congress is proposing to chop American aid by a fifth. Brazil is giving more to the Somali famine than Germany, France and Italy combined. There are exceptions: Britain and Australia promise to boost aid spending. But they seem like a last hurrah of Western generosity.

Adding that:

In this new world the justification for aid and the behaviour of donors must change. For India and others, it is far from clear why the government should send aid abroad when it has so many poor people at home. No doubt, aid will be defended as a boost to global influence. The risk for India is that, just like the West did in the 1960s, it will pour money into grand projects which fail—and encourage bad government.

I disagree with this latter assessment. It is not aid per se that caused the epic governance problems facing most of the low-income countries of the world. Sure it stunted the co-evolution of accountable government and domestic revenue generation. But the biggest failure of aid was what it was spent on.

Aid being highly fungible meant that most of the money wound up in the private accounts of venal leaders and gun-runners.

Things have since changed a bit. For instance, China’s resources-for-infrastructure deals can be a model for Aid 2.0 (this no doubt needs some tweaking too, as this damaging expose on Sino-Angolan oil deals shows). Plus this time the infrastructure investments are different. In an earlier period most of the investments were overtly white elephant projects (like Moi’s infamous hydro-electric dam in Turkwel). Most of the current projects are in roads, telecoms, and to some extent agriculture – investments that will have a much bigger impact because of their broader reach.

You can find a related earlier post here.

Graphical Illustration of China’s global reach

22 June 2011

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NPR has this cool graphic on China’s global investments [click on image to enlarge].

Notice that Nigeria is among the top destinations of Chinese investments.

In my alternate universe Abuja (the undisputed regional hegemon) is stable and uses this, and the fact that it is also among the most important sources of US-bound crude oil, as leverage to nudge the two biggest global powers in the direction of a more stable and coherent Africa policy.

More on this here.

Dictatorship and Disease

24 May 2011

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Most Bad things go together.

Like Keating at FP, I am unwilling to make any causal claims linking dictatorship to disease or vice versa but suffice it to say that most people who live under dictatorships – in Chad, Zimbabwe, Myanmar, North Korea, etc – do live despite great odds occasioned by their respective governments’ incompetence and runaway lack of accountability.

It is not obvious that democracy necessarily leads to good outcomes. In this regard I agree with Huntington that it is not the type of government that matters but the degree of government. China and Rwanda, for instance, are competent autocracies with high degrees of government. They also register much better outcomes than many nominal democracies out there

(Just for the record, this is not to say that we should not promote democracy. Despite the sobering reality of this world, I believe that everyone should do all in their capacity to help disperse power whenever they see it being concentrated in one individual or institution — paraphrasing my officemate Tomer).