Academy of Economic Studies
Faculty of International Economic Relations
Master in Business Communication
Geopolitics of China
1.China - General presentation
China, one of oldest
civilizations in the world, has a written history of 4,000 years It is the
inventor of compass, paper-making, gunpowder and printing. The Great Wall, Grand Canal
and Karez irrigation system are three great ancient engineering projects built
2,000 years ago. Now they are the symbols of the rich culture of the Chinese
nation. China
has gone over a long history of primitive society, slavery society, feudal
society and semi-feudal semi-colonial society and the present socialist
society. Chinese Dynasties. [1]
The People's Republic of China is a unified, multi-national country, comprising
56 nationalities. The Han people make up 91.02 percent of the total population,
leaving 8.98 percent for the other 55 ethnic minorities. They are Mongolian,
Hui, Tibetan, Uygur, Miao, Yi, Zhuang, Bouyei, Korean, Manchu, Dong, Yao, Bai,
Tujia, Hani, Kazak, Dai, Li, Lisu, Va, She, Gaoshan, Lahu, Shui, Dongxiang,
Naxi, Jingpo, Kirgiz, Tu, Daur, Mulam, Qiang, Blang, Salar, Maonan, Gelo, Xibe,
Achang, Pumi, Tajik, Nu, Ozbek, Russian, Ewenki, Benglong, Bonan, Yugur, Jing,
Tatar, Drung, Oroqen, Hezhen, Moinba, Lhoba and Gelo. All nationalities in China
are equal according to the law. The State protects their lawful rights and
interests and promotes equality, unity and mutual help among them.
It has 50,000 rivers each covering a catchment
area of more than 100 square kilometers, and 1,500 of them cover a catchment
area exceeding 1,000 square kilometers. Most of them flow from west to east to
empty into the Pacific Ocean. Main rivers
include the Yangtze (Changjiang), Yellow (Huanghe), Heilong, Pearl, Liaohe, Haihe, Qiangtang and Lancang.
The Yangtze of 6,300 kilometers is the longest river in China. The
second longest Yellow River is 5,464
kilometers. The Grand Canal from Hangzhou to Beijing is a great water project in ancient China. It is of
1,794 kilometers, making it the longest canal in the world.
Also, it is a
multi-religious country. Buddhism, Taoism, Islam, Catholicism and
Protestantism, with the first three being more wide spread.Various religions have
different influence on different ethnic groups. Islam is followed by the Hui,
Uygur, Kazak, Kirgiz, Tatar, Dongxiang, Salar and Bonan nationalities; Buddhism
and Lamaism are followed by the Tibetan, Mongolian, Dai and Yugur
nationalities; Christianity is followed by the Miao, Yao and Yi nationalities;
Shamanism is followed by the Oroqen, Ewenki and Daur nationalities; the
majority Han nationality believes in Buddhism, Christianity and Taoism.
Chinese Money
is called Renminbi (RMB) (means
'People's Currency'). The popular unit of RMB is Yuan. The official exchange rate between U.S. Dollar and
Renminbi Yuan currently is about 1 :
8.3 (1.00 Dollar = 8.30 Yuan Yuan to 10 Jiao Jiao to 10 Fen (There
are parts of China
the Yuan is also known as Kuai and Jiao is known
as Mao. Chinese currency is issued in
the following denominations: one, two, five, ten, fifty and a hundred Yuan; one, two and five Jiao; and one, two and five Fen
2.
Geopolitics of China
Contemporary China
is an island. Although it is not surrounded by water (which borders only its
eastern flank), China
is bordered by terrain that is difficult to traverse in virtually any
direction. There are some areas that can be traversed, but to understand China
we must begin by visualizing the mountains, jungles and wastelands that enclose
it
This outer shell both
contains and protects China.
Internally, China is
be divided into two parts: the Chinese heartland and the non-Chinese buffer
regions surrounding it. There is a line in China called the 15-inch isohyet,
east of which more than 15 inches of rain fall each year and west of which the
annual rainfall is less. The vast majority of Chinese live east and south of
this line, in the region known as Han China - the Chinese heartland. The region
is home to the ethnic Han, whom the world regards as the Chinese. It is
important to understand that more than a billion people live in this area,
which is about half the size of the United States.
The Chinese heartland is divided
into two parts, northern and southern, which in turn is represented by two main
dialects, Mandarin in the north and Cantonese in the south. These dialects
share a writing system but are almost mutually incomprehensible when spoken.
The Chinese heartland is defined by two major rivers - the Yellow River in the
north and the Yangtze in the South, along with a third lesser river in the
south, the Pearl.
The heartland is China's
agricultural region. However - and this is the single most important fact about
China
- it has about one-third the arable land per person as the rest of the world.
This pressure has defined modern Chinese history - both in terms of living with
it and trying to move beyond it.
An area of non-Han regions
surround this heartland - Tibet, Xinjiang province (home of the Muslim Uighurs),
Inner Mongolia and what is commonly referred as Manchuria (a historical name given
to the region north of North Korea that now consists of the Chinese provinces
of Heilongjiang, Jilin and Liaoning). These are the buffer regions that
historically have been under Chinese rule when China
was strong and have broken away when China was weak. Today, there is a great deal of Han settlement
in these regions, a cause of friction, but today Han China is strong.
2.1. Threats to China
2.1.1. Han China
These are also the regions
where the historical threat to China
originated. Han China is a region full of rivers and rain. It is therefore a
land of farmers and merchants. The surrounding areas are the land of nomads and
horsemen. In the 13th century, the Mongols under Ghenghis Khan invaded and
occupied parts of Han China until the 15th century, when the Han reasserted
their authority.
Following this period, Chinese
strategy remained constant: the slow and systematic assertion of control over
these outer regions in order to protect the Han from incursions by nomadic
cavalry. This imperative drove Chinese foreign policy. In spite of the
imbalance of population, or perhaps because of it, China saw itself as extremely
vulnerable to military forces moving from the north and west. Defending a
massed population of farmers against these forces was difficult. The easiest
solution, the one the Chinese chose, was to reverse the order and impose
themselves on their potential conquerors.
There was another reason. Aside from providing buffers,
these possessions provided defensible borders. With borderlands under their
control, China
was strongly anchored. Let's consider the nature of China's
border sequentially, starting in the east along the southern border with Vietnam and Myanmar. The border with Vietnam
is the only border readily traversable by large armies or mass commerce. In
fact, as recently as 1979, China
and Vietnam fought a short
border war, and there have been points in history when China has dominated Vietnam. However, the rest of the
southern border where Yunnan province meets Laos and Myanmar is hilly jungle, difficult
to traverse, with almost no major roads. Significant movement across this
border is almost impossible. During World War II, the United States struggled to build the Burma Road
to reach Yunnan
and supply Chiang Kai-shek's forces. The effort was so difficult it became
legendary. China
is secure in this region
2.1.2. Hkakabo Razi
Almost 19,000 feet high, this region marks the border
between China, Myanmar and India. At this point, China's southwestern frontier begins, ending
with the Himalayas. More precisely, it is
where Tibet, controlled by China, borders India
and the two Himalayan states, Nepal
and Bhutan.
This border runs in a long arc past Pakistan,
Tajikistan and Kyrgyzstan, ending at Pik Pobedy, a 25,000-foot
mountain marking the border with China,
Kyrgyzstan and Kazakhstan.
It is possible to pass through this border region with difficulty;
historically, parts of it have been accessible as a merchant route. On the
whole, however, the Himalayas are a barrier to
substantial trade and certainly to military forces. India
and China-and China and much of Central
Asia - are sealed off from each other
The one exception is the
next section of the border, with Kazakhstan. This area is passable
but has relatively little transport. As the transport expands, this will be the
main route between China and
the rest of Eurasia. It is the one land bridge
from the Chinese island that can be used. The problem is distance. The border
with Kazakhstan is almost a
thousand miles from the first tier of Han Chinese provinces, and the route
passes through sparsely populated Muslim territory, a region that has posed
significant challenges to China.
Importantly, the Silk Road from China
ran through Xinjiang and Kazakhstan
on its way west. It was the only way to go.
2.1.3. Northern Border
There is, finally, the long
northern border first with Mongolia
and then with Russia,
running to the Pacific. This border is certainly passable. Indeed, the only
successful invasion of China took place when Mongol horsemen attacked
from Mongolia,
occupying a good deal of Han China. China's
buffers - Inner Mongolia and Manchuria - have
protected Han China from other attacks. The Chinese have not attacked northward
for two reasons. First, there has historically not been much there worth
taking. Second, north-south access is difficult. Russia has two rail lines running
from the west to the Pacific-the famous Trans-Siberian Railroad (TSR) and the
Baikal-Amur Mainline (BAM), which connects those two cities and ties into the
TSR. Aside from that, there is no east-west ground transportation linking Russia.
There is also no north-south transportation. What appears accessible really is
not.
The area in Russia that is most accessible from China is the region bordering the Pacific, the
area from Russia's Vladivostok to
Blagoveschensk.
This region has reasonable
transport, population and advantages for both sides. If there were ever a
conflict between China and Russia,
this is the area that would be at the center of it. It is also the area, as you
move southward and away from the Pacific, that borders on the Korean Peninsula,
the area of China's
last major military conflict.
2.1.4. The coast
China's most vulnerable point, since the arrival of Europeans in
the western Pacific in the mid-19th century, has been its coast. Apart from
European encroachments in which commercial interests were backed up by limited
force, China
suffered its most significant military encounter-and long and miserable war-after
the Japanese invaded and occupied large parts of eastern China along
with Manchuria in the 1930s. Despite the
mismatch in military power and more than a dozen years of war, Japan
still could not force the Chinese government to capitulate. The simple fact was
that Han China, given its size and population density, could not be subdued. No
matter how many victories the Japanese won, they could not decisively defeat
the Chinese.
2.2. China's geopolitics principles
China is hard to invade; given its size and population, it is
even harder to occupy. This also makes it hard for the Chinese to invade others-not
utterly impossible, but quite difficult. Containing a fifth of the world's
population, China can wall
itself off from the world, as it did prior to the United Kingdom's forced entry in
the 19th century and as it did under Mao Zedong. All of this means China
is a great power, but one that has to behave very differently than other great
powers.
China has mainly 3 geopolitical principles :
Maintain internal unity in the Han
Chinese regions
- Maintain
control of the buffer region
- Protect
the coast from foreign encroachment
Ø Maintaining Internal Unity
China is more enclosed than any other great power. The size of
its population, coupled with its secure frontiers and relative abundance of
resources, allows it to develop with minimal intercourse with the rest of the
world, if it chooses. During the Maoist period, for example, China became an insular nation, driven
primarily by internal interests and considerations, indifferent or hostile to
the rest of the world. It was secure and, except for its involvement in the
Korean War and its efforts to pacify restless buffer regions, was relatively
peaceful. Internally, however, China
underwent periodic, self-generated chaos.
The weakness of insularity
for China
is poverty. Given the ratio of arable land to population, a self-enclosed China is a poor China. Its population is so poor
that economic development
driven by domestic demand, no
matter how limited it might be, is impossible. However, an isolated China
is easier to manage by a central government. The great danger in China
is a rupture within the Han Chinese nation. If that happens, if the central
government weakens, the peripheral regions will spin off, and China will then be vulnerable to
foreigners taking advantage of Chinese weakness.
For China to prosper, it has to engage
in trade, exporting silk, silver and industrial products. Historically, land
trade has not posed a problem for China. The Silk Road allowed
foreign influences to come into China
and the resulting wealth created a degree of instability. On the whole,
however, it could be managed.
The dynamic of industrialism
changed both the geography of Chinese trade and its consequences. In the
mid-19th century, when Europe-led by the British-compelled the Chinese
government to give trading concessions to the British, it opened a new chapter
in
Chinese history. For the first
time, the Pacific coast was the interface with the world, not Central
Asia. This, in turn, massively destabilized China.
As trade between China
and the world intensified, the Chinese who were engaged in trading increased
their wealth dramatically. Those in the coastal provinces of China, the region most deeply
involved in trading, became relatively wealthy while the Chinese in the
interior (not the buffer regions, which were always poor, but the non-coastal
provinces of Han China) remained poor, subsistence farmers.
The central government was
balanced between the divergent interests of coastal China and the interior. The coastal
region, particularly its newly enriched leadership, had an interest in
maintaining and intensifying relations with European powers and with the United States and Japan. The more intense the trade,
the wealthier the coastal leadership and the greater the disparity between the
regions. In due course, foreigners allied with Chinese coastal merchants and
politicians became more powerful in the coastal regions than the central
government. The worst geopolitical nightmare of China came true. China fragmented, breaking into
regions, some increasingly under the control of foreigners, particularly
foreign commercial interests. Beijing
lost control over the country. It should be noted that this was the context in
which Japan invaded China, which made Japan's
failure to defeat China
all the more extraordinary.
China's primary geopolitical issue is this: For it to develop it
must engage in international trade. If it does that, it must use its coastal
cities as an interface with the world. When that happens, the coastal cities
and the surrounding region become increasingly wealthy. The influence of
foreigners over this region increases and the interests of foreigners and the
coastal Chinese converge and begin competing with the interests of the central
government. China
is constantly challenged by the problem of how to avoid this outcome while
engaging in international trade
Ø
Controlling the Buffer Regions
Prior to Mao's rise, with the
central government weakened and Han China engaged simultaneously in war with Japan,
civil war and regionalism, the center was not holding. While Manchuria was
under Chinese control, Outer Mongolia was under Soviet control and extending
its influence (Soviet power more than Marxist ideology) into Inner Mongolia,
and Tibet
and Xinjiang were drifting away.
At the same time that Mao was
fighting the civil war, he was also laying the groundwork for taking control of
the buffer regions. Interestingly, his first moves were designed to block
Soviet interests in these regions. Mao moved to consolidate Chinese communist
control over Manchuria and Inner Mongolia,
effectively leveraging the Soviets out. Xinjiang had been under the control of
a regional warlord, Yang Zengxin. Shortly after the end of the civil war, Mao
moved to force him out and take over Xinjiang. Finally, in 1950 Mao moved
against Tibet,
which he secured in 1951.
The rapid-fire consolidation of
the buffer regions gave Mao what all Chinese emperors sought, a China
secure from invasion. Controlling Tibet
meant that India could not
move across the Himalayas and establish a
secure base of operations on the Tibetan Plateau. There could be skirmishes in
the Himalayas, but no one could push a
multidivisional force across those mountains and keep it supplied. So long as Tibet
was in Chinese hands, the Indians could live on the other side of the moon.
Xinjiang, Inner Mongolia and Manchuria buffered China
from the Soviet Union. Mao was more of a
geopolitician than an ideologue. He did not trust the Soviets. With the buffer
states in hand, they would not invade China. The distances, the poor
transportation and the lack of resources meant that any Soviet invasion would
run into massive logistical problems well before it reached Han China's
populated regions, and become bogged down-just as the Japanese had.
China had
geopolitical issues with Vietnam,
Pakistan and Afghanistan, neighboring states with which it
shared a border, but the real problem for China
would come in Manchuria or, more precisely, Korea.
The Soviets, more than the
Chinese, had encouraged a North Korean
invasion of South Korea.
It is difficult to speculate on Joseph Stalin's thinking, but it worked out
superbly for him. The United States
intervened, defeated the North Korean Army and drove to the Yalu, the river
border with China.
The Chinese, seeing the well-armed and well-trained American force surge to its
borders, decided that it had to block its advance and attacked south. What resulted
was three years of brutal warfare in which the Chinese lost about a million
men. From the Soviet point of view, fighting between China
and the United States
was the best thing imaginable. But from Stratfor's point of view, what it
demonstrated was the sensitivity of the Chinese to any encroachment on their
borderlands, their buffers, which represent the foundation of their national
security.
Ø Protecting the Coast
With the buffer regions
under control, the coast is China's
most vulnerable point, but its vulnerability is not to invasion. Given the
Japanese example, no one has the interest or forces to try to invade mainland China,
supply an army there and hope to win. Invasion is not a meaningful threat.
The coastal threat to China
is economic, though most would not call it a threat. As we saw, the British
intrusion into China
culminated in the destabilization of the country, the virtual collapse of the
central government and civil war. It was all caused by prosperity. Mao had
solved the problem by sealing the coast of China off to any real development
and liquidating the class that had collaborated with foreign business. For Mao,
xenophobia was integral to national policy. He saw foreign presence as
undermining the stability of China.
He preferred impoverished unity to chaos. He also understood that, given China's
population and geography, it could defend itself against potential attackers
without an advanced military-industrial complex.
His successor, Deng Xiaoping, was
heir to a powerful state in control of China and the buffer regions. He
also felt under tremendous pressure politically to improve living standards,
and he undoubtedly understood that technological gaps would eventually threaten
Chinese national security. He took a historic gamble. He knew that China's
economy could not develop on its own. China's internal demand for goods
was too weak because the Chinese were too poor.
Deng gambled that he could open China
to foreign investment and reorient the Chinese economy away from agriculture
and heavy industry and toward export-oriented industries. By doing so he would
increase living standards, import technology and train China's workforce. He was betting
that the effort this time would not destabilize China, create massive tensions
between the prosperous coastal provinces and the interior, foster regionalism
or put the coastal regions under foreign control. Deng believed he could avoid
all that by maintaining a strong central government, based on a loyal army and
Communist Party adepts. His successors have struggled to maintain that loyalty
to the state and not to foreign investors, who can make individuals wealthy.
That is the bet that is currently being played out.
China's
current position
From a
political and military standpoint, China has achieved its strategic
goals. The buffer regions are intact and China
faces no threat in Eurasia. It sees a Western
attempt to force China out
of Tibet
as an attempt to undermine Chinese national security. For China, however,
Tibet
is a minor irritant; China
has no possible intention of leaving Tibet, the Tibetans cannot rise up and
win, and no one is about to invade the region. Similarly, the Uighur Muslims
represent an irritant in Xinjiang and not a direct threat. The Russians have no
interest in or capability of invading China,
and the Korean Peninsula does not represent a direct
threat to the Chinese, certainly not one they could not handle.
The
greatest military threat to China
comes from the U.S. Navy. The Chinese have become highly dependent on seaborne
trade and the U.S. Navy is in a position to blockade China's ports if it wished. Should
the United States do that,
it would cripple China.
Therefore, China's
primary military interest is to make such a blockade impossible.
It would take several generations
for China
to build a surface navy able to compete with the U.S. Navy. Simply training
naval aviators to conduct carrier-based operations effectively would take
decades-at least until these trainees became admirals and captains. And this
does not take into account the time it would take to build an aircraft carrier
and carrier-capable aircraft and master the intricacies of carrier operations.
For China,
the primary mission is to raise the price of a blockade so high that the
Americans would not attempt it. The means for that would be land- and
submarine-based-anti-ship missiles. The strategic solution is for China to construct a missile force sufficiently
dispersed that it cannot be suppressed by the United
States and with sufficient range to engage the United States
at substantial distance, as far as the central Pacific.
This missile force would have to be able to identify and
track potential targets to be effective. Therefore, if the Chinese are to
pursue this strategy, they must also develop a space-based maritime
reconnaissance system. These are the technologies that the Chinese are focusing
on. Anti-ship missiles and space-based systems, including anti-satellite
systems designed to blind the Americans, represent China's military counter to its
only significant military threat.
China
could also use those missiles to blockade Taiwan by interdicting ships going
to and from the island. But the Chinese do not have the naval ability to land a
sufficient amphibious force and sustain it in ground combat. Nor do they have
the ability to establish air superiority over the Taiwan
Strait. China
might be able to harass Taiwan
but it will not invade it. Missiles, satellites and submarines constitute China's
naval strategy.
For China,
the primary problem posed by Taiwan
is naval. Taiwan is
positioned in such a way that it can readily serve as an air and naval base
that could isolate maritime movement between the South China Sea and the East
China Sea, effectively leaving the northern Chinese coast and Shanghai isolated. When you consider the
Ryukyu Islands that stretch from Taiwan
to Japan and add them to
this mix, a non-naval power could blockade the northern Chinese coast if it
held Taiwan.
Taiwan
would not be important to China
unless it became actively hostile or allied with or occupied by a hostile power
such as the United States.
If that happened, its geographical position would pose an extremely serious
problem for China.
Taiwan is also an important
symbolic issue to China
and a way to rally nationalism. Although Taiwan
presents no immediate threat, it does pose potential dangers that China
cannot ignore.
China does not have a military-based geopolitical problem. It is
in its traditional strong position, physically secure as it holds its buffer
regions. It has achieved it three strategic imperatives. What is most
vulnerable at this point is its first imperative: the unity of Han China. That
is not threatened militarily. Rather, the threat to it is economic.
4.1. Economic
implications
The problem of China, rooted in geopolitics, is
economic and it presents itself in two ways. The first is simple. China
has an export-oriented economy. It is in a position of dependency. No matter
how large its currency reserves or how advanced its technology or how cheap its
labor force, China
depends on the willingness and ability of other countries to import its goods-as
well as the ability to physically ship them. Any disruption of this flow has a
direct effect on the Chinese economy.
The primary reason other
countries buy Chinese goods is price. They are cheaper because of wage
differentials. Should China
lose that advantage to other nations or for other reasons, its ability to
export would decline. Today, for example, as energy prices rise, the cost of
production rises and the relative importance of the wage differential
decreases. At a certain point, as China's trading partners see it,
the value of Chinese imports relative to the political cost of closing down
their factories will shift.
And all of this is outside of China's
control. China
cannot control the world price of oil. It can cut into its cash reserves to
subsidize those prices for manufacturers but that would essentially be
transferring money back to consuming nations. It can control rising wages by
imposing price controls, but that would cause internal instability. The center
of gravity of China
is that it has become the industrial workshop of the world and, as such, it is
totally dependent on the world to keep buying its goods rather than someone
else's goods.
There are other issues for China,
ranging from a dysfunctional financial system to farmland being taken out of
production for factories. These are all significant and add to the story. But
in geopolitics we look for the center of gravity, and for China the center of
gravity is that the more effective it becomes at exporting, the more of a
hostage it becomes to its customers. Some observers have warned that China
might take its money out of American banks. Unlikely, but assume it did. China
has placed itself in a position where it has to keep its customers happy. It
struggles against this reality daily, but the fact is that the rest of the
world is far less dependent on China's
exports than China
is dependent on the rest of the world. Which
brings us to the second, even more serious part of China's economic problem.
The first geopolitical
imperative of China
is to ensure the unity of Han China. The third is to protect the coast. Deng's
bet was that he could open the coast without disrupting the unity of Han China.
As in the 19th century, the coastal region has become wealthy. The interior has
remained extraordinarily poor. The coastal region is deeply enmeshed in the
global economy. The interior is not. Beijing
is once again balancing between the coast and the interior.
The interests of the coastal
region and the interests of importers and investors are closely tied to each
other. Beijing's
interest is in maintaining internal stability. As pressures grow, it will seek
to increase its control of the political and economic life of the coast. The
interest of the interior is to have money transferred to it from the coast. The
interest of the coast is to hold on to its money. Beijing
will try to satisfy both, without letting China break apart and without
resorting to Mao's draconian measures. But the worse the international economic
situation becomes the less demand there will be for Chinese products and the
less room there will be for China
to maneuver.
The second part of the problem derives from the first.
Assuming that the global economy does not decline now, it will at some point.
When it does, and Chinese exports fall dramatically, Beijing will have to balance between an
interior hungry for money and a coastal region that is hurting badly. It is
important to remember that something like 900 million Chinese live in the
interior while only about 400 million live in the coastal region. When it comes
to balancing power, the interior is the physical threat to the regime while the
coast destabilizes the distribution of wealth.
Conclusions
Geopolitics is based on
geography and politics. Politics is built on two foundations: military and
economic. The two interact and support each other but are ultimately distinct.
For China,
securing its buffer regions generally eliminates military problems. What
problems are left for China
are long-term issues concerning northeastern Manchuria
and the balance of power in the Pacific.
China's geopolitical problem is economic. Its first geopolitical
imperative, maintain the unity of Han China, and its third, protect the coast,
are both more deeply affected by economic considerations than military ones.
Its internal and external political problems flow from economics. The dramatic
economic development of the last generation has been ruthlessly geographic.
This development has benefited the coast and left the interior-the vast
majority of Chinese-behind. It has also left China vulnerable to global economic
forces that it cannot control and cannot accommodate. This is not new in
Chinese history, but its usual resolution is in regionalism and the weakening
of the central government. Deng's gamble is being played out by his successors.
He dealt the hand. They have to play it.
The question on the table is whether the economic basis of China
is a foundation or a balancing act. If the former, it can last a long time. If
the latter, everyone falls down eventually. There appears to be little evidence
that it is a foundation. It excludes most of the Chinese from the game, people
who are making less than $100 a month. That is a balancing act and it threatens
the first geopolitical imperative of China: protecting the unity of the
Han Chinese
