China’s One Belt One Road Stretches to Africa


Trial services on the railway line began last October and regular services transporting goods and passengers are expected to begin early this year. Photo: Xinhua

Trial services on the railway line began last October and regular services transporting goods and passengers are expected to begin early this year. Photo: Xinhua

In its report titled “Why China-built electric railway linking landlocked Ethiopia to sea matters to Beijing and Africa”, SCMP says, “A US$3.4 billion electrified railway line built by China was officially launched on Tuesday to link the Horn of Africa to its inland countries.

“The line connects the strategic Red Sea port of Djibouti and Addis Ababa, the capital of landlocked Ethiopia, the fastest growing economy in Africa.”

This railway will connect China with landlocked African countries, a much longer stretch of China’s Silk Road.

It seems Chinese President Xi Jinping’s Chinese dream of Silk Road economic belt and 21st century maritime Silk Road (One Belt, One Road) will soon come true.

Comment by Chan Kai Yee on SCMP’s report, full text of which can be found at http://www.scmp.com/news/china/diplomacy-defence/article/2061124/why-china-built-electric-railway-linking-landlocked?spm=0.0.0.0.cn2buE.


China Moves Abroad Labor-intensive Industries through One Belt One Road


Hambantota deep water port

Sri Lanka’s Hambantota deep water port for China’s One Belt, One Road

Hambantota airport for China's One Belt, One Road

Hambantota airport for China’s One Belt, One Road

There will be quite a few advantages for Chinese President Xi Jinping’s Silk Road economic belt and 21-century maritime Silk Road (One Belt, One Road) initiative.

The most important is trade security by establishment of land trade route to Europe through Russia and Central Asia and safer maritime route through Indian Ocean with ports in Bangladesh, Sri Lanka and Pakistan.

The other also very important advantages include:
Finding an outlet for China’s overcapacity in its industries of construction, construction material, energy, transport, etc.;

Exploiting investment opportunities for China’s surplus capital; and

Moving China’s labor-intensive industries through development of infrastructures in the belt to the countries in the Belt where labor and other resources are much cheaper.

Reuters says in its report “Sri Lanka launches China-led investment zone amid protests” that the zone will create 100,000 jobs, which undoubtedly will mostly be jobs in labor-intensive enterprises moved from China.

According to Reuters, China’s port, airport and investment zone make “some countries, including India and the United States, nervous with Sri Lanka’s proximity to shipping lanes through which much of the world’s trade passes en route to China and Japan.

Those are trade passes to China and Japan not US or India, why shall they be nervous?

Anyway, we see from the developments Xi’s wisdom and vision. US president-elect Trump’s threat of a trade war may create difficulties for the export of China’s labor-intensive industrial goods, but Xi has taken a step earlier in building infrastructures abroad for China to move such industries to poor countries for export to the US. Xi has been subduing the US with his wise One Belt One Road strategy before the US starts the trade war.

The best way in military conflict is to subdue the enemy with strategy, the next, with diplomacy, the next, with fighting…                                                                                                                      Sun Tzu

Comment by Chan Kai Yee on Reuters’ report, full text of which can be found at http://www.reuters.com/article/us-sri-lanka-china-investment-idUSKBN14R0JG.


PLA Air Force to Keep on Patrol of East, South China Seas


Chinese H-6K bomber warplanes conducting regular combat patrol of South China Sea

Chinese H-6K bomber warplanes conducting regular combat patrol of South China Sea

I really wonder why the Philippines and Australia are worried by China’s deployment of defensive weapons on its artificial islands according to Reuters’ report today “China defends its right to ‘ready slingshot’ in South China Sea” that I reblogged less than an hour ago.

Does the Philippines or Australia want to attack China’s artificial islands?

If they want to worry, they have to worry about Chinese air force’s training in and patrol of the South China Sea. As China’s H-6K bombers are patrolling the sea fully armed, they may attack the Philippines or Australia at any time if they have received such orders.

SCMP says in its report “PLA air force vows to continue training and patrols over East and South China seas”, “The mainland Chinese air force said on Thursday it would continue training and patrols in the air space over the East and South China seas, following recently intensified drills that have rattled Taiwan and Japan.”

“Such flights have became more frequent since a telephone call between Taiwanese president Tsai Ing-wen and US president-elect Donald Trump on December 2,” says the report. Obviously, China is exploiting Trump’s use of Taiwan as a bargaining chip to pressure Taiwan and enhance tension to scare away the investment that Taiwan urgently needs.

A shrewd US president will soon replace stupid Obama. It is interesting to watch the competition of shrewdness between Trump and China’s Xi.

So far Xi is the winner. He is exploiting Trump’s trick to create difficulties for Taiwan President Tsai Ing-wen in improving Taiwan economy. If Tsai fails to improve economy, she will lose to pro-Beijing KMT in the next presidential election.

Comment by Chan Kai Yee on SCMP’s report, full text of which can be found at http://www.scmp.com/news/china/diplomacy-defence/article/2054845/pla-air-force-vows-continue-training-and-patrols-over.


Both Trump and China’s Xi gain in Graver Tension across Taiwan Strait


Taiwan's President Tsai Ing-wen speaks on the phone with U.S. president-elect Donald Trump at her office in Taipei, Taiwan, in this handout photo made available December 3, 2016.   Taiwan Presidential Office/Handout via REUTERS/File Photo

Taiwan’s President Tsai Ing-wen speaks on the phone with U.S. president-elect Donald Trump at her office in Taipei, Taiwan, in this handout photo made available December 3, 2016. Taiwan Presidential Office/Handout via REUTERS/File Photo

Trump is regarded as inexperienced in diplomacy when he questioned US one-China policy. There is fear that China may, therefore, take Taiwan by force. China’s military threat is real and it has sent fighter jets to fly around Taiwan.

Reuters says in its report “U.S. urges Taiwan to increase defense spending given China threat” yesterday, “Defense spending in Taiwan has not kept pace with the threat posed by China and should be increased, a senior U.S. defense official said on Tuesday, days after U.S. President-elect Donald Trump touched off a storm by questioning American policy over the island.”

The US official meant that Taiwan should buy more weapons. That will certainly enable US weapon producers to make more money as the US is Taiwan’s only weapon supplier.

Trump need not send US troops to heighten tension across Taiwan Strait. A few words are quite enough. China will respond with military threat at Taiwan and Taiwan has to buy more US weapons resulting in Taiwan having less funds to seek economic growth.

China will, on the other hand, greatly reduce its preferential treatments for Taiwan to aggravate Taiwan’s economic difficulty while the tension caused by Trump and China will scare investors away and cause them to refrain from investing in Taiwan or even withdraw their investment. Taiwan’s economic difficulties may cause pro-independence President Tsai Ing-wen to lose the next presidential election to pro-Beijing KMT. Peaceful solution of the Taiwan issue will be facilitated by the KMT if its is in power.

Some analysts are afraid that Trump’s hawkish words may encourage Tsai to declare Taiwan independence. Is Tsai so stupid when she is not sure that the US will support and succeed in supporting Taiwan independence? She must have the common sense that China is much more important than Taiwan for the US. The US only wants to use Taiwan as a bargaining chip. It has no intention to fight a war with China for Taiwan as it will gain nothing in the war even if it wins the war.

Therefore, China’s Xi will laugh in his sleeve at Trump’s use of Taiwan as a bargaining chip as it helps Xi in his efforts for a peaceful solution of the Taiwan issue.

Comment by Chan Kai Yee on Reuters’ report, full text of which can be found at http://www.reuters.com/article/us-usa-taiwan-defense-idUSKBN1422TT.


Trump a Shrewd Businessman, China’s Xi Not Less Shrewd


A file picture of a PLA Su-30 fighter and an H-6K bomber taking part in a drill in the Western Pacific in September. Photo: Xinhua

A file picture of a PLA Su-30 fighter and an H-6K bomber taking part in a drill in the Western Pacific in September. Photo: Xinhua

Trump, as a businessman, knows how to make profit so that he has been able to build up his enormous empire.

What does he want as US president then?

Some analysts believe that his hardline policies may give rise to World War III.

Why?

Does he want his commercial buildings and hotels destroyed by nuclear bombs?

His speeches may be self-contradicting sometimes, but not his goals to become US president: He wants the US to gain in order to make its economy prosper. If US economy prospers, so will his business empire along with it.

Some analysts are so stupid as to think that Trump will play some dirty secret tricks to benefit his empire. If so, Trump will be bankrupt politically. Will he be so stupid?

His open trick to make the US prosper for the benefit of his business empire is to enable the US to benefit from its diplomacy.

How?

He uses his hardline rhetoric to cause tension in the world.

In Europe, he praises Putin and thus encourages Putin to be more aggressive so that Europe wants better US protection. The US will gain in having Europe to pay more for the protection or buy more US advanced weapons for self-protection.

In Asia, he will reverse Obama’s stupid policies of containing China.

Obama’s pivot to Asia hurts the US instead of benefiting it. Economically, the US has to make concessions to have TPP accepted by other members in order to contain China. Hurting oneself to hurt one’s competitors. That is not a wise businessman’s way. A wise businessman hurts his competitors in order to benefit himself.

It is sure that TPP may hurt the US but whether it may hurt China remains a question as China is carrying out substantial reform to make its economy adapt to TPP.

Obama’s efforts to contain China by intervention with China’s disputes with its neighbors in the South China Sea have entirely failed as US threat has caused China to build seven artificial islands there to entirely remove the threat of US attack of China from the South China Sea.

In fact, tension in the South China Sea may not cause countries there to pay for US protection or buy US weapons. ASEAN will not seek US protection for fear of upsetting China as it is now greatly benefited by better relations with China. US only ally there the Philippines may want better US protection and US weapons but it is too poor to be able to pay for that.

Trump does not want to contain China. On the contrary, he want the US to have substantial gains from China’s vast market. He wants China to make trade concessions for better US access to Chinese market.

For that, he needs tension in East Asia. His telephone call with Taiwan President Tsai Ing-wen was precisely aimed at that. He will try to sell more weapons to Taiwan and support Japan in its disputes with China to cause China to make trade concessions.

On the other hand, he appoints a pro-China politician as US ambassador to China for better economic ties with China. That will be his carrot and stick policies toward China.

By so doing, he will not only gain concessions from China but also make Japan and South Korea pay more for US protection and make them and Taiwan buy more US weapons.

If Trump succeeds in both Europe and Asia, he will be able to get substantial gains for his country so that he will be sure to win the next presidential election for a second term.

China’s Xi Jinping is not less shrewd. SCMP says in its report “PLA will ‘step up flights near Taiwan’ to pressure Tsai after Trump phone call” today, “Beijing wants to keep up the pressure on the island amid fears the US may soften its stance on its policy that Taiwan is part of one China”. Taiwan is Xi’s priority now. He has to cause Taiwan’s pro-independence president Tsia Ing-wen to lose to the pro-Beijing KMT in the next Taiwan presidential election.

SCMP says “China’s military has already flown a series of flights close to the island in recent months as it tries to ratchet up pressure on Taiwan’s independence-leaning government.” Trump’s support for Tsai will give Xi the excuse to send more warplanes to threaten Taiwan.

That will force Taiwan to incur huge costs to buy US weapons at the expense of its economic growth. Xi, on the other hand, will contain Taiwan economically by reducing import of Taiwanese products and Mainland tourists to Taiwan. Tsai’s economic failure will cause her to lose the next election.

There is always the military alternative for Xi to take Taiwan by force, but that will be Xi’s last resort. He certainly does not want to risk a war with the US. Even if the US does not intervene, he will have difficulties in dealing with the aftermath of the war.

Having a pro-Beijing Taiwan government is a much better choice for him. For that he need tension in Taiwan Strait. The military threat of Xi’s takeover of Taiwan by force will aggravate Taiwan’s economic difficulties as no one will invest in Taiwan under the threat. Trump will help Xi in creating the tension.

Article by Chan Kai Yee.

Full text of SCMP’s report mentioned in the article can be found at http://www.scmp.com/news/china/policies-politics/article/2052513/pla-will-step-flights-near-taiwan-after-trump-tsai-call


Trump picks longtime friend of Beijing as U.S. ambassador to China


Governor of Iowa Terry Branstad exits after meeting with U.S. President-elect Donald Trump at Trump Tower in Manhattan, New York City, U.S., December 6, 2016. REUTERS/Brendan McDermid

Governor of Iowa Terry Branstad exits after meeting with U.S. President-elect Donald Trump at Trump Tower in Manhattan, New York City, U.S., December 6, 2016. REUTERS/Brendan McDermid

By Dominique Patton and Steve Holland | BEIJING/NEW YORK

President-elect Donald Trump will nominate Iowa Governor Terry Branstad as the next U.S. ambassador to China, choosing a longstanding friend of Beijing after rattling the world’s second largest economy with tough talk on trade and a telephone call with the leader of Taiwan.

The appointment may help to ease trade tensions between the two countries, the world’s two biggest agricultural producers, diplomats and trade experts said. Branstad has visited China at least six times, and Chinese President Xi Jinping has traveled to Iowa twice, including once while Branstad was governor.

Branstad’s appointment also suggests that Trump may be ready to take a less combative stance toward China than many expected, the experts said.

Trump in a statement cited Branstad’s qualifications including experience in government and longtime relationships with Xi and other Chinese leaders. The nomination, which will be formally made once the Republican president-elect is sworn in on Jan. 20, was well received, even among some Democrats.

“He’s tenacious, and trust me, with the Chinese, you need to be tenacious,” U.S. Agriculture Secretary Tom Vilsack, a former Iowa governor, said of Branstad.

Trump, who defeated Hillary Clinton in last month’s election, has said that when he takes office he intends to declare China a currency manipulator, meaning it keeps the yuan artificially low to make its exports cheap, and has threatened to impose punitive tariffs on Chinese goods coming into the United States.

Added to that, his unusual decision to accept a call from Taiwan President Tsai Ing-wen last week prompted a diplomatic protest on Saturday from Beijing, which considers Taiwan a renegade province. Trump’s transition team played down the exchange as a courtesy call, but the White House had to reassure China that its decades-old “one-China” policy was intact.

Branstad’s established personal connection with China could help smooth a relationship defined largely by international security matters and by bilateral trade, where the massive U.S. trade deficit with the country is a source of friction.

“It means that the Trump team understands that it is important to have an ambassador who has access to Xi Jinping,” Bonnie Glaser, a China expert at the Center for Strategic and International Studies think tank in Washington, said of the pick.

Branstad called Xi a “longtime friend” when Xi visited Iowa in February 2012, only nine months before he became China’s leader.

On Wednesday, Branstad said he and Xi have had a “30-year friendship” and added: “The president-elect understands my unique relationship to China and has asked me to serve in a way I had not previously considered.”

Before his nomination was announced, Foreign Ministry spokesman Lu Kang called Branstad an “old friend” of China when asked in Beijing about a Bloomberg report on the appointment, although he said China would work with any U.S. ambassador.

“We welcome him to play a greater role in advancing the development of China-U.S. relations,” he told a daily news briefing.

Xi’s ties to Iowa go back more than 30 years: He visited Iowa in 1985 on an agricultural research trip when he led a delegation from Hebei Province, returning 27 years later and reuniting with some of the people he had met.

Trump’s stance on China has been in particular focus since Friday’s call with Tsai, the first such top-level contact with Taiwan by a U.S. president-elect or president since President Jimmy Carter adopted a “one-China” policy in 1979, recognizing only the Beijing government.

DUMPING ALLEGATIONS

China is the United States’ largest trading partner in goods. But imports from China far outstripped U.S. exports, making for a trade deficit with China of $336.2 billion in 2015, according to the U.S. Trade Representative.

Specific U.S. trade concerns include allegations that China is dumping steel and aluminum in global markets below the cost of production, hurting American producers. In the agricultural sector, the United States has been unable to get Beijing to lift anti-dumping measures on U.S. broiler chicken products and an animal feed ingredient known as distillers’ dried grains (DDGS).

China is one of Iowa’s biggest export markets, so Branstad is well placed to deal with China-U.S. trade issues, said Professor Huang Jing, an expert on Chinese politics at the National University of Singapore.

“This really sends a message that Donald Trump wants to handle China at the bilateral relationship level,” he said.

Branstad, 70, visited China most recently as the leader of a trade mission that made stops in Beijing and Hebei in November. He will be “somebody who clearly understands agriculture representing U.S. interests” in China, said Dale Moore, executive director for public policy at the American Farm Bureau Federation.

(Reporting by Sangameswaran S in Bengalaru, Christian Shepherd in Beijing, John Ruwitch in Shanghai; Additional reporting by Doina Chiacu and Matt Spetalnick in Washington, Tom Polansek and Mark Weinraub in Chicago and Kay Henderson in Des Moines; Writing by Richard Cowan and David Ingram; Editing by Robert Birsel, Martin Howell, Frances Kerry and Jonathan Oatis)

Source: Reuters “Trump picks longtime friend of Beijing as U.S. ambassador to China”

Note: This is Reuters report I post here for readers’ information. It does not mean that I agree or disagree with the report’ views.


Trump Hard to Deal with, Abe Urgently Wants Better Relations with China


President Xi Jinping (front left) and Prime Minister Shinzo Abe (front, third from right) pictured in a group photograph of leaders attending the Apec summit in Peru. Photo: AP

President Xi Jinping (front left) and Prime Minister Shinzo Abe (front, third from right) pictured in a group photograph of leaders attending the Apec summit in Peru. Photo: AP

Trump’s demand for Japan to pay all the costs that the US incurs in maintaining US military presence in Japan to protect it is Japanese Prime Minister Abe’s great headache.

Trump’s firm opposition to TPP is an even graver problem. To get TPP signed by its members Abe has made some hard concessions and made great efforts to convince Japanese general public to accept. However, Obama has failed to get TPP accepted by US Congress while Trump has declared that he would scrap TPP as soon as he is inaugurated.

In order to bring Trump around, according to CNN report titled “Trump and Japan’s Abe meet for ‘very candid discussion’ in New York”, Abe met with Trump in New York on November 18 and had “very candid discussion” with Trump. Usually “candid” as a diplomatic term means that each side expresses his entirely different views without reserve in straightforward manner and fails to reach agreement.

Obviously, Trump insisted on his view that Japan only paid 15% of US costs to protect Japan while Abe insisted that Japan has paid 75%. It is interesting what compromise they will finally make. There must be an agreement in the end as neither of them want to break their alliance.

TPP is a disaster for Abe as in spite of the concession Abe has made, Trump regards TPP as utterly unacceptable and unfavorable to the US.

Previously, Abe is not anxious about the ASEAN plus three free trade area (ASEAN +3) that his predecessor has commenced discussions. He did not hesitate to cause much delay in the discussions when he visited Yasukuni Shrine to upset China and South Korea, the two major potential members of ASEAN +3.

After all US market is most important for Japan. China’s market is also large and has great potential, but ranks the second in Abe’s priority as after all Japan has geographical and cultural advantages over the US, Japan’s major competitor in Chinese market.

Abe’s promise to bring about Japanese economic growth was a major factor for his Party’s victory in Japan’s parliamentary election. He relies on TPP for expansion of market for Japanese products in order to honor his promise.

Without TPP, Abe has to seek expansion of market through ASEAN + 3. In order to make meaningful progress in the discussions for ASEAN +3, Abe wants Chinese Premier Li Keqiang to attend the Japan-South Korea-China summit for ASEAN +3 Japan will host later this year.

For that Abe has to curry favor with Chinese President Xi Jinping; therefore, SCMP says in its report “Xi Jinping, Abe meet briefly on Apec sidelines … but China and Japan give differing accounts of it”, according to Chinese foreign ministry spokesman Lu Kang, Abe invited Xi to meet with him on APEC sidelines. However, in order to save face, “Yasuhisa Kawamura, a spokesman for Abe, said the two leaders ‘stepped a couple of paces towards each other’ after a group meeting of 21 leaders on Sunday morning, and that the meeting ‘was a natural movement’.”

SCMP says that Abe told Xi during the 10-minute meeting that he would like to seek overall improvement in Sino-Japanese ties. He expressed his desire to have Li visit Japan for the trilateral summit, but Xi gave no clear answer to that request.

Xi is not less shrewd than Abe. He took advantages of Abe’s anxiety to set his conditions by saying “It is important to settle outstanding issues properly and increase popular sentiment towards improving ties.”

Abe certainly understand that by outstanding issues, Xi meant the dispute over the Diaoyus and Japan’s support of US deployment of THAAD in South Korea while by popular sentiment, Xi meant that Abe should refrain form hurting Chinese peoples’ feeling in actions related to Japan’s war crimes in invading China such as visiting Yasukuni Shrine.

Obviously, Abe is playing into Xi’s hands now, but he cannot help that.

Comment by Chan Kai Yee on CNN and SCMP’s reports, full text of which can respectively be found at http://edition.cnn.com/2016/11/17/politics/abe-trump-japan-meeting/ and http://www.scmp.com/news/china/diplomacy-defence/article/2047836/china-japans-leaders-meet-briefly-sidelines-apec-summit