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China on a learning curve

Updated On: Jun 01, 2007

China has quite a bit on its plate recently – all part and parcel of a learning curve as a rising power.

With its trade frictions with the US unresolved and the lingering tainted food export saga unfurling to hurt its international image, China now has to deal with EU noises about its international dealings in Darfur, pressures on climate change and a slight glitch with India over border issues.

Chinese-made food and drug scares started when diethylene glycol, a toxic chemical sometimes used in antifreeze ended up in cough syrup and toothpaste sold in Central and Latin America.  It was alleged that more than 100 people in Panama had died from the tainted cough syrup. In other incidents, 11 people died in Chinaafter being treated with an injection tainted by a toxic chemical while six people died and 80 others fell ill after taking an antibiotic that had been produced with a disinfectant.  Perhaps reflecting increasing distrust, rumours are being circulated that bananas grown in Hainan contains viruses similar to Sars, greatly hurting the industry and costing Hainanese banana producers up to 20 million yuan ($US2.6m) a day. China's Agriculture Ministry has stepped in to quash the rumours and have activated police investigations. "It is utterly a rumour," a Chinese Health Ministry official was quoted as saying by Xinhua news agency. "There has not been a case in the world in which humans have contracted a plant virus, and there is not any scientific evidence."

To placate the recent fears about Chinese food exports which has turned inwards to worry domestic consumers, the Chinese leadership went about to set an example by imposing a very harsh sentence on the former director of China’s top food and drug safety agency for his corruption charges.  He was sentenced to death for corruption and accepting bribes from pharmaceutical companies and his execution was meant to serve as a warning to others.

While the lax food and drug regulation issue likely to occupy China’s attention for some time on the domestic side, the Chinese also have to deal with increasing criticisms from abroad on its international conduct. During the 8th Asia-Europe Foreign Ministers meeting held in Hamburg, European foreign ministers confronted China over Kosovo, the Darfur conflict and its tacit support for Myanmar. EU wants China to condemn the Myanmarese government over the detention of pro-democracy campaigner Aung San Suu Kyi while China sees it as a mainly domestic issue.

China's close ties with Sudan as an arms dealer for the latter in exchange for its oil is also under scrutiny. The Europeans are getting increasingly impatient with Chinese positions on Sudan with Iranian and North Korean issues festering in the background. Some Europeans see China as an obstacle in UN attempts to tackle rogue states and their international excesses. On top of state to state relations, Germany, the host of the EU-Asia meeting also wants to pin down China on the issue of eliminating greenhouse gas emissions once the Kyoto protocol runs out in 2012.

EU’s pressures on China come at a time when the latter is dealing with American unhappiness at its trade policies. The verdict is still split on whether such pressures from the West would push China to do more to improve its record or achieve the opposite effect of convincing Chinese suspicions that the West is trying to curb its rise. This is especially so since resentment about US demands on Chinese yuan revaluations is becoming more and more vocal.

Also causing international concerns is the recent overheated Chinese stock market. Shanghai's main stock index has penetrated through the 4,000 mark for the first time with strong investor interest, but analysts warned  that this may be a bubble. The latest warning came from former Federal Reserve chairman Alan Greenspan who said that the Chinese stock market could undergo a dramatic correction. Underlining such concerns is that fact that the current bout of stock market fever is driven not by large institutional investors but by ordinary people like students, housewives and pensioners. 300,000 people a day opened brokerage accounts in China. The overheated stock markets have even prompted the Chinese government to warn students not to dabble in shares.

Other than China’s impact on global issues, other rising powers in Asia also have their bones to pick with China bilaterally. When Beijing’s embassy in New Delhi rejected issuing a visa to an Indian official from the north-eastern Arunachal Pradesh state on the grounds that he does not need one as he is a Chinese citizen, it triggered sensitivities over the unresolved border issue.  The official belonged to a group of 107 mid-career government officials which India had dispatched to China for a two-week study tour. In protest, India cancelled the trip for the entire group. Similar incidents have taken place in April 2007 when three other officials and an Arunachal state legislator were denied visas for the same reason and a few years back when former Arunachal chief minister Gegong Apang tried applying for a visa and was rejected on the same grounds.

In the ongoing negotiations between the two Asian giants, China has zeroed in on the Buddhist enclave of Tawang and has refused to budge in this issue as Tawang once belonged to Tibet and China wants New Delhi to return it in order to settle bilateral border issues. In the ongoing negotiations, a proposal for Chinese-held Arunachal to be exchanged with the India-held western sector of the Himalayas is being floated.

China understands that India has been parading its claim over Arunachal and is particularly sensitive to Indian moves to legitimize its claim over the territory. At India’s 26 January 2007 Republic Day parade, civilian floats featuring life in Arunachal Pradesh was presented by India for visiting VIP President Vladimir Putin of Russia. Such antics are likely to complicate the ongoing negotiations for border issue settlement.

Not all bilateral relations have been as tricky for Chinese, however. China and Thailand signed the Joint Action Plan on China-Thailand Strategic Cooperation and the Agreement on Mutual Recognition of Academic Degrees in Higher Education after Chinese Premier Wen Jiabao held talks with visiting Thai Prime Minister Surayud Chulanont. While this accord was important in promoting exchanges, Surayud is also keen to solicit Chinese money for the construction of roads, railways (a rail link between China's Yunnan province and northern Thailand) and industrial zones in Thailand.

Eager to polish up its international image and gain acceptance for its post-coup government, Thailand is looking to China for reassurance of support and she got it. Chinese President Hu praised Thailand as a close, trustworthy and cooperative friend that respected the development path chosen by the Thai people, the official Xinhua news agency was quoted as saying. In return for this recognition, Thailand reiterated its one-China policy while Gen Surayud expressed gratitude for the consistent support and understanding of the Chinese government for Thailand. (31 May 2007)

Sources:

Ex-Chief of China Food and Drug Unit Sentenced to Death for Graft (Channelnewsasia, 30 May 2007)

Surayud vows ties with China will stay strong (Bangkok Post, 29 May 2007)

EU pushes Asia on climate change (Bangkok Post, 29 May 2007)

China reaffirms its claim to disputed state (Straits Times, 28 May 2007)

Europe seeks to pressure China at EU-Asia meeting (AFP, 28 May 2007)

ChinaThailand sign strategic deals (Xinhua, 28 May 2007)

China's stock market hits record (BBC News, 28 May 2007)

China wants dialogue, US just wants more (Asia Times,26 May 2007)

Killer banana rumour grips China  (BBC News, 25 May 2007)