China: Dubious Data

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September 15, 2015: The Philippines is pressing the United States to provide more direct military aid and assistance in resisting growing Chinese pressure to take control of islands and reefs in the South China Sea that, according to international law are Filipino. The American commanders want to help but current U.S. policy is to avoid confrontation with China. Meanwhile China continues to insist that its claims on the South China Sea, including territory existing international law recognizes as belonging to Taiwan, the Philippines, Vietnam, Malaysia and others are justified by historical precedent and there is no disputing that. In fact China is using its growing military and economic power to bully any opposition into recognizing Chinese claims. 

There are more ominous implications to all this. China has made it clear that it intends to use its armed forces to protect its “maritime Silk Road” trade routes to the Middle East and Africa via the South China Sea and Indian Ocean. This is part of a new economic policy China is pushing, to have China increase economic investments in countries that border the “silk road”. This has got all the nations adjacent to this new Silk Road worried. It has not helped that in August China said it was finished creating new islands (for military bases) in the South China Sea, because satellite and aerial photos show such island building is still going on. Taiwan is also alarmed at China releasing a video showing special operations commandos training by assaulting a facsimile of rather distinctive Taiwanese government buildings.

China sent North Korea congratulations on the 67th anniversary of its founding. North Korea played down this message, which in East Asia is seen as disrespectful. This is apparently in reaction to North Korean dismay over a recent show of disrespect by China. This is all about why North Korean leader Kim Jong Un agreed to go to China for the September 3rd parade marking the 70th anniversary of the end of World War II (according to the Chinese Communist Party) but later decided not to show up. The visit was cancelled without explanation. At the end of August Chinese rumors of what happened reached North Korea and rapidly spread. It appears that Kim Jong Un expected to be standing next to Chinese leader Xi on the reviewing stand but was told this was not going to happen. Kim Jong Un took this as an insult and cancelled his visit. China told him this was disrespectful and there would be repercussions. That apparently led to China telling North Korea they were on their own during the August confrontation with South Korea and that forced North Korea to back down. North Korea denies there was any dispute with China over where anyone would stand during the parade but North Koreans believed the “petulant Kim Jong Un” version and Kim Jong Un is not happy about that, especially since the South Korean president attended. China has made it clear that it considers South Korea, now a major trading partner, the more important part of Korea. That relationships has a downside as China is the largest export customer for South Korea and the showdown of the Chinese economy over the last year has caused a recession in South Korea.

The Chinese Communist Party is playing up its acknowledgement that corruption is the biggest problem the party, and the country, faces. Left unsaid is that fact that the government tolerated too much corruption for too long. This was partly greed and partly an effort to prevent the dwindling number of communist true believers from interfering with the economic liberalization that has brought China unprecedented wealth and power. The “economic miracle” began in the 1980s and since 2005 Communist Party purists have become nearly extinct. At the same time public anger against corrupt officials has grown to dangerous levels. The communist bureaucrats were rudely reminded of this after the August 12th series of massive explosions in the warehouse district of a port city (Tianjin) near the capital. The final death toll was 173 with about 400 badly injured and billions of dollars’ worth of damage done. This disaster was not supposed to happen. There were laws about storing so much explosive (and poisonous) chemicals in one place and so close to residential areas. The government ordered the arrest of the owners of the warehouse complex and local officials expect to be prosecuted. Some of those arrested could possibly be executed.

This sort of thing has happened before. It has happened too many times before and is still happening with increasing frequency despite government assurances that it is aware of the problem and is dealing with it. The problem that is not discussed much is that China has never had a strong centralized government. In the past Chinese empires thrived because the imperial government was able to promptly deal with provinces that became too corrupt and unruly. Chinese see their government as unable to identify, arrest and replace corrupt local officials quickly enough. This failure is seen as a danger to every Chinese. It isn’t just the massive explosions in major cities but the growing air pollution, even in the capital, and less obvious but just as harmful water and food pollution. What good is all this new wealth if the government cannot keep people healthy enough to enjoy it? Chinese leaders also openly warn the police and army that continued unrest in western China (Tibet and Xinjian) is driven not only by cultural and religious differences but also by the corruption of government officials. The government has publically promised to make a difference when it comes to corruption. That is a laudable goal that has eluded Chinese governments for centuries.

September 14, 2015: The government ordered safety checks on all facilities handling nuclear materials. The military has a good safety record with nuclear material but nuclear power plants and the use of nuclear materials in medicine is another matter. The power reactor risk has long been recognized and in 2009 South Korea completed delivery of its first nuclear power reactor to China. This was part of an effort to get away from Russian designs that China had been using for decades. South Korean Doosan Heavy Industries had this 600 megawatt reactor on line by 2012. Firms like Doosan have been selling China power plant components for years, but this was the first sale of a complete nuclear power plant. Currently China has 21 reactors producing electricity, with another 28 planned or under construction. Currently China has about fifty power, research and medical nuclear facilities in operation. Existing nuclear power plants only provide about two percent of electricity, and China wants to increase that in order to reduce pollution (80 percent of current electricity is produced by burning coal.) The goal is to have nuclear plants producing six percent of electricity by 2020. Meanwhile nuclear power produces 20 percent of the American electricity and 74 percent in France.

September 13, 2015: After years of pressure from privately owned businesses, economists and anti-corruption officials China announced plans to reform the way state owned companies are run. About a quarter of the economy is still controlled by state owned firms. These operations make far less profit than privately owned firms and are seen as a form of make-work to keep unemployment down. Worse, these inefficient firms are often run by very corrupt and inept officials and not allowed to go bankrupt. The reforms are supposed to make the state owned firms more competitive and subject to bankruptcy. With a looming labor shortage the government feels it can survive a lot of these state owned firms going bankrupt.

The government issued a lot of new economic data over the weekend and more people (inside and outside China) are questioning the reliability of that data. Those doubts are one of the reasons for sharp fall in Chinese stock markets over the last few months. That market decline has halted during the last few weeks and the government points out that overall stock prices are about 20 percent higher than a year ago. Chinese investors are also nervous about the government supplied economic data and the impact of corruption on the economic and physical health of the nation.

September 12, 2015: China and India are trying to negotiate another border dispute. In this case an Indian patrol caught China building a watchtower on the Indian side of the border in Indian state of Ladakh (northwest India) and had to persuade the Chinese to withdraw. India has had 150 disputes like this so far this year and about two-thirds of them resulted in confrontations between Indian and Chinese troops. This sort of thing has been common in the last few years and China usually backs down, eventually. Most of these incidents occur in only four areas, Ladakh being one of them.

September 5, 2015:  The U.S. confirmed that five Chinese warships had, for the first time, passed through U.S. territorial waters. This was all quite legal as the Chinese ships were on their way to a naval exercise with Russian warships and exercised its right, under maritime law, to undertake "innocent passage" through American territorial waters off the Aleutian Islands to reach Russian territory. The Aleutian Islands extend from Alaska to the east coast of Russia and the territorial waters (22 kilometers from the shore) create a barrier to travel between the North Pacific and the Bering Sea. Maritime law recognizes such situations and allows for "innocent passage" for ships that are just passing through, which is what the Chinese ships were doing (and Russian ships regularly do). Nevertheless this was another first for the Chinese Navy.

September 4, 2015: South Korea revealed that it detected North Korean UAVs (Chinese made D-4s, a 140 kg aircraft with a 28 kg payload) crossing the DMZ between 22 and 24 August. Jet fighters and attack helicopters were sent up to intercept. Since similar incidents last year South Korea has deployed radars to the DMZ that can detect small, low flying UAVs. South Korea did not reveal if it intercepted these UAVs. 

September 2, 2015: Pakistan announced that nearly all Uighur Islamic terrorists in Pakistan had been killed or driven from the country. For several years China has been pressing Pakistan to do something about Chinese Islamic terrorists (Turkic Uighurs from northwest China) based in Pakistan and Pakistan finally began making some serious moves on that problem in early 2014. There followed the June 2014 offensive in North Waziristan concentrating on the “bad Taliban” and their allies (like the Uighurs).  Pakistan is still reluctant to admit it is the cause of so many regional Islamic terrorism problems but the neighbors were not being very understanding. China, which supplies a lot of Pakistan’s weapons and foreign investment, finally told its troublesome neighbor to fix the situation or see China go from being a helpful to a hostile neighbor. The other neighbors have had a similar reaction, but given China’s place as Pakistan’s most important ally, Pakistan could no longer ignore the problem.

August 29, 2015:  North Korean leader Kim Jong Un replaced more of his senior military leaders. This has been going on since Kim assumed power in 2011 and was seen as an effort to get younger and more dynamic military leaders in place. Kim is desperate to reverse the decline of his armed forces but with a crumbling economy and little foreign aid (mainly from China, which threatens to cut aid if the north defies China again) prospects are not good.

August 26, 2015: In April, May and June of 2015 Japanese fighters had to take off and intercept intruders 173 times. Chinese aircraft were the cause 66 percent of the time otherwise they were usually Russian. During the same three months in 2014 there were 340 Japanese fighter sorties to deal with intruders and 70 percent of the time the intruders were Chinese. In 2013 Japanese aircraft went up over 300 times to confront Chinese aircraft (often recon aircraft) coming too close to Japanese air space. Thus 2013 was the first year Chinese intrusions exceeded Russian ones. This has been coming for several years. In 2011 nearly 43 percent of the sorties were for Chinese aircraft. That's almost three times as many Chinese intrusions as in 2010. Russian aerial activity has been declining for years and this is believed due to the difficulty and expense of keeping elderly Russian aircraft operational. Russia cannot afford to replace its Cold War era aircraft. 

 

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