Currently, China is also building a high velocity train from Peru ( Pacific Ocean) to Brazil (Atlantic ocean) - the better to flood its products faster in the region; and, in Argentina it has established a “scientific base” that is billed as a super telescope to “gaze into space.” China’s space program is said to be aimed at targeting US satellites.
Argentina’s President Macri seems, for now at least , happy with Chinese investment in his country. As Trump fiddles, not only is the country going down the tubes, but is weakening the US’ global influence. China’s African adventure is also well entrenched, though some countries are beginning to see and push back on President’s Xi ultimate goal
18
Leaders of Pakistan are you listening?
Pakistan speaks of China-Pakistan Economic Corridor (CPEC). potential to transform Pakistan into a regional economic powerhouse, and even make it the next “Asian Tiger” economy. Pakistan press was effusive in their praise of China. Beijing was hailed for going out of its way to substantially strengthen bonds with Pakistan. Its economic aid was looked upon as largesse and indicative of the commitment of the Chinese leadership towards Pakistan.
However, little was known about its massive plans for Pakistani agriculture. CPEC’s long-term plan reveal that Chinese enterprises will lease thousands of acres of Pakistani agricultural land to set up ‘demonstration projects’ to introduce new seed varieties, pesticides and irrigation technologies. Facilities for processing, storing and transporting, grains, fruits and vegetables are also being set up, indicating that access to the full supply chain of Pakistan’s agriculture is an important goal of CPEC. China is using CPEC to strengthen its food security.
As it stands today CPEC could turn into another East India Company. Pakistan is building a city for half a million Chinese nationals at a cost of $150 million in port city of Gwadar. The planned city is a part of CPEC. Only Chinese citizens will live in this gated zone, a China's colony within Pakistan.
6
Didn't massive theft by former Malaysian prime minister -- and Trump pal -- Najib Razak account for some of this debt?
4
Wonderful reporting by the Times. It's ironic that Malaysians will be able to read this but mainland Chinese won't. The communist government blocks the Times in China. One supposes that the communists don't much like reporting like this.
12
The TPP was the best tool we had for containing Chinese economic imperialism by working with the rest of Asia. Too bad Trump killed it on his first day in office.
12
Of course if a new global Chinese empire could make the world safe for travel again and help solve regional wars, famines and refugee crises I suppose I might be willing to give up some personal freedoms in exchange. The desire to have a peaceful life even under tyrants is a powerful thing.
El Salvador just cut ties with Taiwan in favor of China. The main reason seems to be that El Salvador wanted a loan for a port project that was economically insane. So now it will get the money from Beijing and be in the same situation as Malaysia.
6
The unfinished buildings in the last photo don't look at all like the showroom model of Forest City shown in an earlier photo. Those buildings are just ugly boxes built way too close together!
No one is going to buy those units. It's going to be one huge eyesore of a ghost town.
2
Malaysia and other countries are worried about China, no doubt. However, they are more concerned with Trump’s America rethorric. In the past should China try to use its military against these countries and force them into compliance or else, they knew the USA wouldn’t allow China to invade these countries. They aren’t so sure America will protect the world order of and protect their sovereignty.
They also see what happened in Ukraine when a superpower decided to just take over parts of Ukraine - nobody could stop them.
5
China has become an international loan shark that sells dubious goods to countries on credit and then possesses their homes when they cannot repay. China did that to Sri Lanka by selling a sea port that nobody wanted to build or fund yet China bribed then Prime Minister of Sri Lanka in taking a loan at an exorbitant interest rate. Malaysia is wise to reject China’s offer or it will lose its country too.
6
This, to me, is another report written with the preset conclusion "China's BRI is hurting you, quit it now". People are willing to read what they agree with, you got it.
There is a vast difference between how the west is looking at BRI and Chinese are looking at it. BRI is viewed bad too by Chinese, but for a different reason.
Chinese understand the initiative is more about increasing geo-poltical influence rather that tricking poor countries into traps. The government is frequently bashed for squandering money on investments, forgiving huge amount of debts from other countries while at the same time not providing enough basic education and welfare to its own citizens.
In a free market economy, anyone is allowed to give you loan on given terms, right? If you made a deal with the bank without being forced to, it is your own fault that you can't afford it in the end. Not necessarily the bank's. Malaysia's corruption is Malaysia's own fault. The new government decided to change it, that's good. I don't see how that leads to the conclusions big infrastructure projects funded by BRI are just "debt traps". If everyone can reject China's free money, it will good for the Chinese people. Hopefully they can be treated better by their government with the money.
6
It may be too late.
It would probably be best for the great western powers to work on education of the Chinese away from corruption, Han Chinese racism, and that peculiar unjustified sense of superiority they have about their long history.
If anything their long history tells us they simply cannot handle it when they become a great nation and apparently even after doing it and destroying themselves a few hundred times even as recently as the 1920's, they still do not learn from those mistakes. They are on the same course right now and going as fast as possible like always.
From what I see of history and the recent past Malaysia is very correct to be worried about China.
6
Clearly China has read "Confessions of an Economic Hitman..." and is following the play book.
1
Guangxi Zhuang Autonomous Region may be an "obscure Chinese autonomous region" to a journalist at a desk in downtown New York, but presumably not to the around 50 million people who live there.
3
@Melbourne Town She doesn't work from NYC, I think. However, it makes it an even bigger issue for a reporter who is meant to be an expert on China related stories.
1
"United States’ influence fades in the developing world."
After EIGHT years of Obama's total withdrawal from the world, why is this a surprise?
@Sparky Jones Thanks, I needed a good laugh. Just for the record, it was Obama's Trans Pacific Partnership, which was designed to INCREASE our engagement in the Pacific, which Trump threw out the window on his very first day in office.
16
The photo of the construction of Forrest City was appalling. What an environmental disaster! And a complete eyesore in a formerly beautiful area.
At the very least the Malaysian government should demand that a high percentage of jobs and contracts go to local Malaysian citizens and majority Malaysian-owned companies. If China wants its ports and land it should be made to pay for them upfront in a way that boosts local prosperity.
18
@Alexandra Hamilton LOL! Most Malays would not want the construction jobs. They prefer the luxury of the government offices sitting under a fan or in air-conditioned room filing paper works.
There is labor shortage in Malaysia and most laborers you see working in construction jobs are immigrants from Bangladesh, Indonesia, Burma and God knows where. The Malays or Bumiputras are a privilege class who enjoys preferential treatments and will not do such demeaning jobs.
Domestic maids are mainly from the Philippines and Indonesia and most local Malays will not touch those jobs. Malaysia has big government and they provides them with good living wage.
Malays are nice and friendly people and most of them are happy with their standard of living. Of course they can do better.
2
When I was in college, my economics instructor brought to light an interesting fact that countries that spend the largest amount of their GDP on the military generally have the lowest standards of living. This is due to the fact that money invested back into their country, whether it be social services, infrastructure, or subsidies to industries have a direct payback in increasing their economies.
When you build a tank or an aircraft carrier, after it s built, it has no payback to the country.
China obviously understands that money invested in their country, or facilities in other countries that contribute to their country's economics will have paybacks in the long game. China spends far less of their GDP on defense as compared to the United States, and this is why they can afford infrastructure projects around the world that will benefit them. And if they can convince other countries to invest their own money to their benefit, they are the smart guys in the room. And corruption just makes it easier.
5
@Michael Panico, The observation is correct, but for the wrong reasoning. Countries strive for military superiority because that would presage commerce. It has always been the case since colonial times. Those military powers, from the Portuguese to the French, Dutch, Germans, Brits, and now Americans, are all developed to find new frontiers for commerce and to ensure their shipping routes are safe.
The Chinese do not have military supremacy, but they have money, gobs of it, at this point. So, they use it to try to dress their needs for commerce. At some point, sovereignty like Malaysia are going to fight back. On the most drastic level, countries could easily have nationalized all the Chinese investment, and the Chinese will have nothing to stand on. THAT's why the Chinese are so adamant in setting up military camp in the middle of South China Sea, if only to provide some kind of safeguard over their economic interests.
3
@Michael Panico
Not the case for Israel. However likely would have one of the highest standards of living in the world if we could get rid of Hamas and Hezbollah, and other Arab countries and Iran stop trying to attack Israel.
@Michael Panico
Nope. Corruption makes everything you said prior to that silly sentence, impossible. Its worse than a tank which you can at least use as it is like a parasite draining the life blood of its victim.
Why do you think every previous Chinese rise to prominence in Asia ended with such violence in China? The resentment of how petty corruption grown large betrayed and stole from the masses the very essence of whatever ideals that version of the middle kingdom held high.
1
Several decades ago, China was exporting its communist ideology to countries around the Indian Ocean, and elsewhere. Today, China is still a communist country, implementing capitalism, with strict governmental control. And, yet they have found an alternative way of spreading their influence and ideology.
China has developed a strong economy. Under the disguise of diplomacy and friendship, China is providing aid to under developed and developing countries. Helping these countries is only a cover up. China is developing a long term goal of exerting its influence in the region and beyond. To establish power and superiority around the world.
We see what is happening in the South China Seas. China has occupied some of the uninhabited islands in the region and set up military bases on them. Islands which have claims from neighboring countries. Providing funds in the form of loans on projects such as constructing airports, harbors and highways are all part of a secret strategy which China is not telling the world.
What exactly is China's motive?
8
@citizen
Please stop calling China communist. It couldn’t be farther from the truth. China is an autocracy, a dictatorship.
1
China is also investing hugely in the Maldives. Maldives first ever bridge, which runs one kilo meter from the capital Male' to the airport island, is being built with Chinese loan. That is $USD350 million. Chines companies are also building skyscrapers in the capital and roads in far away islands.
The Maldivian government has also drawn up a map of a silk route and has come up with a free trade agreement with the Chinese.
Keeping in mind that the Maldives government annual budget is around $USD1 billion I think these are huge investments which we are probably going to be unable to repay.
7
$5.5 trillion in goods move through South China Sea shipping bottleneck per year, 90% of it to or from Chinese ports. If even a tiny fraction of that gets diverted over Malaysian soil to shipping lanes on the other side, bypassing America's "chain of islands" containment blockade, Malaysia would be swimming in free money as the middleman.
I smell outside coercion on this one. It's too lucrative to give up. There are hundreds of other Chinese projects they could have cut, such as high rise housing for people too poor to afford them, or highways to small rural towns where few people own cars. Instead, they cut only 2, one of them being this free money printer, and leave the money wasters. The money wasters don't harm America's containment policy against China, this money printer does.
1
@George How much are these other projects that you brought up costing Malaysia? If they're worth many billions, you may have something there. If not, it's likely that the most costly are attracting the most attention.
China is deftly playing a long game with its Silk Road plans and the US and other Western nations are mired in petty short term economic battles and paying no attention. Here in the US we have a president who probably just thinks of the Silk Road as a great financial opportunity for his real estate companies. Even if he understands that Silk Road is in no ones national interest except China’s he doesn’t care. Trump’s interests are firmly fixed on his own commercial success and he could care less about long term geopolitics. Same goes for the rest of our elected officials.
3
I wonder where the Chinese got these ideas of controlling small nations? Maybe the're trying to build their own Banana Republics? Well, it has worked before, in this planet those with the money make the rules.
3
Couldn't there be some amicable agreement between China & ourselves?
We could inform them in advance the countries we intend to level with our bombs. They, in turn, would know in advance what countries would need to repair their devestated infrastructure with new projects.
I wish someone would put forward this practical proposal, which would satisfy both the Chinese wish to create & the American fondness for destruction.
5
Malaysia and all other countries that invites China has to obey their new masters if they want their money.
China does not seek to improve the conditions of any other people then their own.
It is a new form of colonialism that will be very destructive to the developing world.
In the end the Chinese will have to pay the heavy price of being despised and hated.
11
Superb article. Western powers during the 19th and early 20th centuries did to China what China is now doing, but on a far bigger scale, to Southeast and Southwest Asia, and to a smaller degree, Africa. Big business deals with no moral foundation designed to overpower the other party and take over the asset. The business is economic and military domination. Freedom of sea navigation and trade are jeopardized. China is the new Soviet Union, controlling its neighbors from Bhutan to Pakistan. When the US stops foreign aid to countries like Pakistan, we lose influence and give China the opening to take over. Short sighted and foolish US foreign policy - not a surprise at the moment.
5
Mahathir is no fool.
(and he's not necessarily someone to climb into bed with either - he's done some unsavory things in his time - but he's absolutely right to sound the alarm here).
China greases its way by spreading and feeding graft and corruption whenever it invests in a country with weak institutions. The end game is not peaceful mutual profit but rather to subjugate the weaker party with debt and enable colonial land grabs - see Sri Lanka.
9
China's method of colonialism is both overt and sublime, from stuffing Tibet with Han Chinese, to the pulverized reef ecosystems in international waters of the East Sea (where they are building military bases and stocking them with killing machines for "only peaceful purposes"), to the uranium and rare-earth mineral belt of sub-Saharan Africa, to the soybean plantations of the chewed-up Amazon basin... The plan is global hegemony, clear as day.
11
Very good decision by new president.
same is case of pakistan--dole were given
to ex-PM-so is now in prision.
2
Trump's ill advised tariffs have taken a global toll in ways much more important than trade. Malaysia is an example of the heavy handed tactics China employed. China used the tariffs to court countries into their fold if those same countries rejected Taiwan's independence & El Salvador is the latest example. Trump harmed America's soybean farmers permanently. China forged a heavy handed deal with Brazil to provide infrastructure to Brazil so they could get their soy to ports and ship to China. Once again, America loses.
The business community saw the global damage Trump's tariffs inflicted and now we read that the US & Mexico will finalize Nafta. Further, Trump agreed to meet with China even tho none of the pre-conditions Trump set forth were met.
Every day Trump remains in power, America loses. Trump's inexperience and tempestuous, infantile behavior has proven disastrous for America. What remains to be seen is whether the traitorous republicans will allow Trump to involve us in war before they impeach him. Unfortunately, the Ds are lead by feckless Schumer whose campaign skills are utterly pathetic. Planet Earth & America have received no help from Schumer.
The world order has massively changed after only 1 year of Trump. God only knows what havoc a full term of Trump could wreak.
2
It never seems to fail. Sooner or later, dictatorships like Russia and China, seeking to expand influence thru assistance, trip over their own feet. They cannot seem to let go of the reins and empower their recipients to take over. Again and again, the “locals” get more resentful and eventually kick the foreigners out.
4
And we Americans can’t manage sufficient attention span to recognize, much less seize, the strategic value of the Trans Pacific Trade Partnership.
We can pet our cell phones as we circle the drain. MAGA indeed.
6
Both the U.S. and China want colonies. But the U.S. does this by arms, invasion, and killing, while China is doing it by investment, corrupt political leaders, and settlement.
3
And to think that, during the 90s, Malaysia was the Great Capitalist Hope™ in the USA to substitute Communist China in outsourcing manufacture.
This is an extremely well researched and written article and an outstanding example of what a large paper like the NYT does best. The American public needs to know how China is quietly extending its grasp on the world, and this piece and the ones on Sri Lanka et al are most enlightening. This broad coverage of the world and the revealing of new ideas and concepts is so much more rewarding to citizens than the petty hacking at Trump's foibles and follies. Enough of that, already, keep up this type of coverage of world events. Bravo.
42
I think Malaysia is big and mature enough country to handle its own international business and foreign relationship. Mr. Mahathir just demonstrated his ability to Chinese leaders in Beijing. I have full confidence that Malaysia will prosper with smaller and limited joint projects with China. As long as communication and dialog continues, both sides benefits. On the other hand, if no foreign capital invests in Malaysia, she will wither in gradual decay. So are we.
4
The Chinese have figured out that the easiest way to control people is through debt. America has provided a great example over the past half-century of how that process works. How many Americans are virtually imprisoned by debt? Homes, cars, luxury goods. Like the Malaysians, how many of us have "financed" things we don't really need and can't really afford? And all that debt we carry throughout life for the most part has the effect of keeping us in check, docile, and beholden to creditors and employers.
32
It is up to the nations to recognise what foreign investment are in their best interests. Corrupt politicians who accept bribes from foreign interests at the expense of their own is nothing new! It is the duty of the opposition parties to expose and the voting public to remove corrupt politicians in power. Failure in carrying out civic duties is a common phenomenon in Asia and around the world in general. It is a shame!
Foreign Directed Investment (FDI) is not a new concept either! Developed nations off loaded “mediocre” jobs overseas where labour was cheaper. G8 nations, Singapore and other rich nations engaged in massive FDI for many decades. Now, some of the nations with literate populations, started leveraging their Human Resources and hence the growing trade deficits. The developed nations will not be able to produce low value products since they do not have cheap labour. Prosperity is a double edged sword in the sense that the entire population needs to lift the capacity and competence game. This is not the case in US and in many developed countries where the divide between rich and poor is wider than ever.
Putting one’s national interest first is not a bad idea so long nations can find the right balance when it comes to FDIs.
As far as the Chinese and their backdoor routes to their aspirations, my guess is that they won’t go far when one goes by historic evidence.
3
Famous last words: "It seemed like a good idea at the time...
"
9
In 1989, there was a grass roots Democracy movement in Communist China ( 八九民运 ) that was brutally crushed live on TV the world over. The United States did nothing and decided to give the same repressive government full access to the world markets and our own. This pact with the devil involved both the Poppy Bush and Clinton administrations as well as Congresses under both Democratic and Republican control.
Corporate America abandoned factories all over the heartland and shifted manufacturing to China, followed by those of many other western democracies. This hollowed out our domestic economy, fattened the bottom line of corporations and enriched the Chinese government.
After decades of transferred wealth to China, they are a massive nation that is on course to become the most important economy in the world. The manufacturing base, resources and technology they possess is critical to most of what is considered modern life in the US and elsewhere. As America indebted itself with McMansions and overpriced SUVs, China has been building it's economy and forcing the transfer of technology from western economies.
This is still the government that crushed the nascent Democracy movement in Tiananmen Square. This government not only holds nuclear weapons, but the soon to be largest economy on earth. Their Navy is gaining capacity to project power and their aggression in the South China Sea is well noted.
All while we slept.
This is not going to end well.
48
The pendulum is swinging the other way now. This is not going to end well for China.
1
@David Gregory TNCs transferred capital to China via investments, which exploited Chinese labor. This valorized that capital. Capital itself does not valorize anything without labor. Apple does not invest a single dollar in assets (or wealth) there. yet it reaps the lion share of profits from the work of others using components (wealth) made in Japan and South Korea.
"We cannot afford this" is really a euphemism for we want to renegotiate the terms of the contract. Under the previous regime, there were allegations of bribes and corruption which ballooned the cost of the projects. What Malaysia wants is to remove the fats and get to the bottom of the cost.
3
@FrazierCrane,
I think that "we cannot afford this" means that we cannot afford this.
6
Malaysia should use its strategic location to play China off against the IMF and other lenders for good terms on small projects for its own benefit. China pledges not to interfere in the internal affairs of small countries, such as imposing austerity plans as the IMF and World Bank do. Instead it bribes government officials to take huge loans for Chinese built projects and pay them back in natural resources. While thus far China’s neocolonialism is not backed by military force, it is building a world class navy—for what purpose?
7
At least the Chinese have the daring for big, long-term, vision (good or bad), that we have abandoned. It would be impossible to think of the US to launch projects of this magnitude and scale. The days of building the Panama Canal or the Hoover Dam are long gone. We're stick in short-termism and NIMBYism that prevents long-term investments in our future.
15
More countries need to understand that the PRC has a standard operating procedure for taking over key assets: Lend money on projects that will not pay for themselves, let the debts run up, then "foreclose" by taking over ports, bridges etc. Beware the PRC bearing gifts.
14
The 93-year old Mahathir Mohamad’s statesmanship hasn’t rusted. He had the courage to express concerns about China using its Belt-And-Road Initiative to gain control of the developing world, making the countries involved dependent on Chinese capital and pawns of its geostrategic game.
What he at a news conference in the Great Hall of the People in Beijing said: “We do not want a situation where there is a new version of colonialism happening because poor countries are unable to compete with rich countries,” must have been felt as a slap in the host’s face.
Mahathir said he had evidence that the East Coast Rail Link could have been built by a local company for about half of the $13.4 billion sum his predecessor, the corrupt Najib Razak agreed to pay the state-owned China Communications Construction Company. The railway would end up costing nearly $20 billion. He also said that Malaysia had already paid $2 billion toward the $2.5 billion pipeline project, carried out by a subsidiary of the China National Petroleum Corporation, but nothing had yet been built.
It just shows the degree of graft under Najib Razak, who faces 20 years in jail if convicted.
27
I visited Malaysia as an eighteen year-old in 1976 and can attest to the suspicions of ethnic Malays toward the ethnic Chinese. The Chinese, according to Malays I met, were reviled as insular and for having an outsize grip on commerce. It would seem as though nothing has changed except that now the Chinese influence is arising from outside the borders. What is the percentage of the population of native Chinese and how do the two cultures interact? Is it similar to the wealth disparity that keeps growing all over the world, or in some cases was there all along? I found Malaysians of both ethnicities to be be warm, friendly people, I hope that hasn't changed.
9
@Chelonian
I was also wandering through Malaysia in the mid 70's just out of my teenage years on a global search for some kind of identity and ended up on the island of Penang in a small fishing village. It was an idyllic place with miles of palm tree-lined white beaches, real uninhabited tropical jungle. You felt like you had gone back in time. Imagine my horror when many years later I saw what the area had become- five story buildings along the same seashore. My initial response was that it was more MacDonaldization of the planet : modern development spoiling native beauty in another place. But whoah. It was much worse than that and turned out to be the brainchild of a Chinese government bent on a hegemonic strategy. Recently Kissinger said the most relevant period of history to study was the period before WWI....
10
@Stephan Morrow, Penang was beautiful as was much of the country. Taiwan, another stop on my trip, is in the "paper" today as well. I remember sitting down at a sumptuous banquet with businessmen who were going to enter the US market through hand tools sold at K-Mart. McDonaldization, indeed.
2
@stephan morrow You mean Penang would remain the way it was in the 1970's if this Chinese project didn't happen?! I know Americans are not thought to know much about geography, but even ignorance should have a limit!
“The ‘Belt and Road Initiative’ (BRI) is intended to develop strong economic ties with other countries, shape their interests to align with China’s and deter confrontation or criticism of China’s approach to sensitive issues.”
“Countries participating in BRI could develop economic dependence on Chinese capital, which China could leverage to achieve its interests,”
The article keeps bringing this back as Neo Colonialism but you know what that description really reminds me of? The Marshall Plan. It worked great for the US, I can understand how China would want to emulate this. Especially in a time of failing American leadership.
8
America GAVE the money to Europe in the Marshall Plan. French and German, etc businesses did the work, using European labor and materials.
China insists on DEBT owed by poor countries, to buy Chinese materials installed by Chinese labor working for Chinese companies.
That is nothing like the Marshall Plan.
70
@Baptiste C.nope. Marshall plan helped the US and Europe. BRI is really about helping China. Many of the projects are not really economical or beneficial for the smaller country. Already there have been some instances where the debt has been too high and the Chinese have taken over the assets. Given that a fair few of them tend to be such things as large ports in strategic locations, I think that is the whole intention. This is part of the whole strategy in the south china sea (see making the artificial islands which are now being turned into military bases) and now beyond. China will own or control much of Asian strategic assets
16
@Frank
No the US government did not. The Marshall plan was a combination of straight out loans (by US Banks with a guarantee by the US government) and grants tied to an obligation to buy american goods.
It was also motivated by the United States' fear of communism getting a hold in Western Europe as a solution to the countries' economic difficulties coming out of the war.
I'm not saying the two plans are the same. But they do share striking similarities.
3
China is looking to colonize the developing world akin to the manner of Great Britain previously, although money, rather than military might, is China's colonization weapon of choice. Using financial incentive is perhaps even more nefarious, as the countries at first don't even realize they're being taken over.
The British Empire at its height in 1920 controlled close to 25% of the populated areas of the world. For China, to step into the shoes of the once greatest empire on the earth is to it's people belated justice, having never forgotten the humiliation suffered at the hands of the British during the two Opium Wars of the 19th Century.
And, with the United States for all practical purposes having ceded its global leadership role, things really seem to be playing into China's hands. If China can keep its economy and leadership on even keel, it's hard to say how far this may go. Of course, that's a big if.
15
They will hold onto the assets they have grabbed with military might if economics fail them. These are military ports they are building and gobbling up. The US with its unbridled love of pure capitalism cannot really ethically object to China defending its new assets by force. I imagine China may just take over governments that threaten its new power using the same rationale of defending its citizens and property that Russia has been using in the Crimea.
I greatly admire the Chinese people, the empires they have ruled, and the gifts to civilization they have made through history. But I also do not wish to become a part of their new empire.
1
While not a big Trump fan it seems like he is one of the few who is willing to deal with China. The neo liberal economic adherents fail to understand the reality of China. Let's hope we deal with them today in a "trade war" rather than a "shooting war" in about twenty years.
5
Well done, Mahathir, a true patriot who has opposed both U.S. and Chinese commercial hegemony. He also rejected IMF dictates in 1997 and even got the IMF to formally admit his policies had saved the Malaysian economy. No wonder he upset the election pundits.
20
With a teetering real estate market and an economy under pressure from the United States, maybe china isn't taking over the world just yet....
7
Thank you.
A wonderfully informative article.
And let's keep this POTUS out of this conversation as this has been happening long before he assumed office.
If anything, blame his predecessor for talking a big Asia game but paying more attention to EU and a "reset" with Russia.
As to the Chinese, why has it taken so long for their neighbors to realise what they are up to?? Cash of course. And include Australia and New Zealand in that mix as well.
Until recent announcements by these two countries, Chinese investors were welcomed with open arms, faened over, catered to. Their politicians kept quiet while China flexed it's military muscle over it's tiny neighbors while we provided these two countries a military umbrella.
And India - the so called nuclear but a bankrupt power - watched while China built a deep water port literally in it's backyard, Sri Lanka. India is so powerless because of it's fixation with Pakistan and it's congenital hatred or distrust of America.
It was almost getting too late - so, I welcome this POTUS calling out China on it's trade practices, stealing of intellectual property, currency manipulation, coddling of north Korea among many issues.
While America is focused on Russian meddling - it's China who we should be worried about.
From our history, we know that it was an Asian power that brought us in WW II.
While "Remember Maine" was a one time rallying cry - "Remember Pear Harbor" is not far behind.
5
@Neil
The previous administration negotiated the TPP trade agreement, an agreement that specifically excluded China... and Trump's done what... oh yeah, he backed out almost immediately upon taking office!
6
@Neil
"And let's keep this POTUS out of this conversation "
"so, I welcome this POTUS calling out China..."
You managed that real well, didn't you?
And where is DJT’s Administration in all this? Oh yeah, they are busy calling Omarosa a dog, telling lies about Mueller, golfing in NJ or Florida. Far too busy to handle foreign affairs regarding 2nd most challenging adversary.
Also, are there no American companies investing in Malaysia?
16
I've spent quite a bit of time in Malaysia and all this rings true. It remains only to add that Donald Trump welcomed Mr. Najib to the White House even after the 1MDB scandal broke. Obama would never have allowed that crook near the place. Now Najib will go down as the biggest thief in Malaysian history. Perhaps that's why Trump was so eager to receive him. They are kindred spirits.
31
@Sinbad
Obama went golfing with Najib while margins Najib's wife dropped $200K at an Hermes shop in Honolulu.
.
This story has nothing to do with Trump. If you want to push it that way, you should do a little fact checking first.
1
Why is everyone so surprised? China has been slowly but surely using its wealth to gain economic influence and power in many countries, especially in Asian countries. Economic influence is readily transformed into military, political, technological, and even cultural influence.
If you walk in downtown Sydney, you would see that a third to half of the faces are Chinese. China has been accumulating assets in Australia for years.
China has made it very clear that it intends to displace the United States as the hegemon in Asia. The late Lee Kuan Yew of Singapore, as astute an observer of geopolitics as there ever was, pointed this out long before he died in 2015.
The American people have long grown weary of being the world's policeman. Both Nixon and Lee noted this 30 years ago. Americans are not likely to be willing to fight if China supplants American influence in Asia. China has no doubt taken notice of this.
Chinese construction projects in foreign countries invariably use all Chinese construction and support crews and Chinese material. Local labor is not welcome. Once built, Chinese assets become de facto colonies.
Other Asian countries are already altering their postures to accommodate China's increasing dominance and America's decline. Mr. Lee's associate, Kishore Mahbubani, recently wrote a very cheeky book entitled "Has the West Lost It?" in which he asserts that resistance to China's dominance is futile. The way things are going, he might just be right.
14
@J. T. Stasiak
It's not that clear at all that China intends to be a hegemon in Asia. What is clear is her actions seemed to be one of a defensive one. America has got her surrounded and regularly patrols naval ships as well as her "reccee" planes near her shores. She has also probably learned an extremely bitter lesson in the previous centuries when she lost Hong Kong, Macau, Taiwan, Manchuria to foreign powers.
It seems that she is now in an economic position to not repeat past mistakes.
From Japan, South Korea, Philippines, Taiwan, Singapore and recently Vietnam, American force presence is a stark reminder of her vulnerability. Not to mention in the pacific islands too.
Remember when Soviets had missiles in Cuba and it almost sparked a nuclear war? The point is , China is positioning her self to protect rather than project .
4
@J. T. Stasiak
They're heavily involved in resource rich Africa and now making moves in South America, most recently Ecuador.
3
The overproduction of capital has been well known phenomena since the 19th century. The internal market is never enough to invest it productively. Thus foreign markets and trade. However, the workers who produced it in the first place cannot consume all its products. Luxury consumption can only go so far as this usually done by the elite. So we end up with periodic gluts. Remember the 2008 crisis triggered by the overproduction of houses offered to people who could not afford them despite the illusions created by advertisement.
The thing keeps repeating itself in different form and places ...
4
@Enri
As the article states, Forest City has nothing to do with the local market and everything to do with China's colonization... as to China's currency control, all they'd have to do us make an exception for this project and since it's a Chinese company building it, they could just repatriate it.
2
Money is not always the same as capital. There is however money capital, but fixed capital (buildings and infrastructure) you cannot repatriate. Money in my pocket is not capital unless I invest it for productive purposes or lend it out at interest
If you’re looking for Chinese-backed investments in artificial islands, you need look no further than the middle of the San Francisco Bay.
7
Remember in Season 1 of the Sopranos when the owner of a motel asked Tony for a favor, which he received, and in exchange Tony and his crew wound up owning the motel?
Better watch out from whom you get favors.
13
Americans fritter away 100s of billions of dollars every year, buying billions of disposable trinkets and baubles from China.
China takes those dollars and saddles enormous debt on vulnerable nations and then inevitably takes what it wants.
Fools and their money, and power, soon part.
16
Not in this case, China's economy is about to roll down word along with the real estate market and stock market
2
Ah, yes, prime minister Mahatir, the great democrat. Have a chat with Anwar Ibrahim about that.
3
@Jason
I guess you could say the lesser of two evils... at least when it comes to dealing with the immediate issues.
1
Mr. Trump didn't kill the TPP: The TPP was stillborn before Trump was elected. Mr. Obama, who negotiated the TPP, did not send it to congress for ratification because the votes required for ratification were not present. The sentiment of the American people is strongly against such treaties at this time. A Senator who supports the TPP would be in serious danger of being voted out of office. Without treaty status, the TPP would be unenforceable. Trump's repudiation of the TPP is moot.
5
@J. T. Stasiak
Incorrect. It would have been a great long term advantage for the US. It needed more PR to get americans to really understand it.
7
The 93-year-old former dictator is the best Malaysia could do. Expect a "new Malaysia"? Meet the new boss, same as the old boss.
8
For a Nation like Malaysia dealing with China is like dealing with Organized Crime.
6
What choice do we have in Malaysia, either China Gang or North American Gang since they are the two largest gangs in the area.
3
China has been on the move for years and rarely does their investment do anything to improve the local economy. In Vancouver, the Chinese have literally taken over the city, driving real estate prices so high, that many people cannot afford to live there. They have just bought the largest dairy in Australia and are taking it public. They are heavily invested in Africa, but locals rarely benefit, because they bring in their own labor. In Southeast Asia, they are heavily invested in Cambodia, are shifting into Myanmar and are building dams in Laos, which will displace many people from the rivers that are the lifeblood of these struggling societies. In mainland China, the people are controlled and monitored, through the use of phones and ID cards. Only Hong Kong has a modicum of freedom. All this is driven by one thing, money, China is swimming in money, and their investment is not investment at all, but taking over. I point again to Vancouver, where swaths of the city refuse to print signs in English or French and where Chinese owned real estate sits empty, depriving communities of commerce. Malaysia is wise to re-think it's policy towards Chinese investment. The rest of the world should be wary as well. As Trump isolates America, its influence wanes, and China is ready to step into power.
19
Let's face it - China is not that great.
First, through out the history of the Chinese people - which covers many different regional ethnicities - they have never been a 'world' power, merely a regional power. And during much of China's history, the mainland has been comprised of many warring factions. As recent as one hundred years ago, parts of China were subjugated to the Japanese Empire and the country was riven by the civil war between the Communist and the Nationalist.
Second, what China is doing in Malaysia and other countries is economic colonialism - no different than what the European power did from the discovery of the Americas up until post-WW II. That does not justify China's action (or the past actions of 'great powers') but it is well within historical precedent.
The real issues of China's assertiveness as a 'world power' are twofold:
1. Will China's policy of economic colonialism prove effective? Given that history has proven that such practices are counterproductive in the long run (that is over decades), China's efforts may be short term gains, but it will be long term suffering, same as Britain, Belgium, Spain, the USSR and, yes, the US.
2. What will the impact of China's policy be domestically? China's economy is build on fast, hot money. Just like the economic upheavals during the industrial revolution (1837, 1873, 1907 and 1929), China will face a downturn leading to internal strife, best case, and external lashing out. The later is the real danger.
8
@Common Sense. You are right inasfar tha China was never a world power. Study China's geography and the reason will be apparent. She also has a huge population that is not homogenous speaking hundreds of dialects in the past.
Over her history she has more trouble keeping their empire together than to look out to expand outside. There is little need to seek global hegemony.
Europe colonialism occurred out of her geography . So many neighborng countries and centuries of war made them seek elsewhere when they learnt how to sail.
2
China wants to export its political system too. Its opaque nature is a very good fit for these projects that tend to benefit only a handful of the people in the target country. Of course that handful benefits nicely.
5
@Bob I have never really understood American's obssesion with exporting political systems or democratic system. I mean, what is the ponit? Dont you guys realise that in many cases it is just imppssible to replicate political systems from ine country to another ? Just take a look at the Middle east, Africa, East Europe, southeast asia, no successful examples whatsoever. Why do you so fervently believe that China will even try to do something even Ameica cannot accomplish?
Is there any actual benefits coming out from exporting political system?
3
@Jian Guan The PRC is not exporting a political system nor expecting others to understand or imitate its supposed "socialism with Chinese characteristics", but instead is offering profitable cronyism to the governors in exchange for power and influence, just as practiced in the PRC itself.
2
The good news. China is autocratic and corrupt. The bad news. China is autocratic and corrupt. Just as Malaysia rejected the “help” of the World Bank” during the Asian financial crisis. It is wise to be very suspicious of Chinese intentions.
10
I warned people about what China would eventually become
after Nixon visited China.
China L.T.D. is war by economic means.
Why the Leftists do not see that China is intent on
making the world its slave wage but instead worry
day and night about being PC is beyond me, but it is
your children's freedom that will be eaten alive by
China.
10
@John Brown I don't understand the comments about lefties and China. All the really pro China supporters are conservative business people - all blinded by $. Try criticizing China in Australia and the business lobby groups will be decrying the racism
2
@Adrien
As usual, business types look for quick money
and don't think about the long term.
If I were Australia I would be vey, very, very
worried that China will one day demand that
Australia open her borders to millions of Chinese Immigrants and if Australia refuses, then China will wage economic warfare on Australia and, if need be in their eyes, militarily
invade Australia.
In the US we are having cultural wars to the death while China keeps usurping the world via its economic and building measures.
I never hear or read about Leftists in America
denouncing China only the people who disagree with their plan to make America in their image, but what will be left of America once China L.T.D. rules the world ?
1
Communist China is the existential threat to Asia’s emerging countries. The Times and others have laid bare China's modus operandi in Sri Lanka, Pakistan and Djibouti --- to grab territory through the “debt trap”! Her artificial islands in South China Sea denies the freedom of navigation and trade to all countries, including the U.S. She has fought wars, big and small, to enforce her unsubstantiated claims of millions of square miles in India, Russia, Vietnam and Mongolia!
China’s external aggression is indeed a projection of her domestic creed of ‘Social Fascism’ and ‘ethnic cleansing’: Tiananmen Squire and the physical-cultural annihilation of Tibetans, Uighurs, inner Mongolians and other ethnic minorities. The fight against China’s external designs is indeed a support to her peoples’ yearning for democracy and freedom.
13
The chinese are comitting to foriegn investment in Malaysia and the nytimes has a problem with that? Whatever happened to free trade and investment? Isnt this similar to what the Americans have been doing all these years in poor countries? Putting in money, building infrastructure, all for some profit at the end? At the end of the day money talks and we all know what walks.
10
Well, Mahathir is sick of all the money walking away from Malaysia--either into China's pockets or the previous PM.
5
The constant bogeyman-ing of China is becoming tiresome and unpersuasive. The pearl-clutching that Westerners do toward China's economic endeavors is largely hypocritical since Western nations would be doing the same things that China is doing had they the opportunity.
8
@Sarah Johnson The difference is that the West has learned from these centuries-old mistakes and no longer attempts colonization through capture or finance. China is nobody's friend. Tell the people of Tibet how tiresome and un-persuasive this narrative is. They will tell you how China is erasing their language, customs, claiming their land and taking their jobs. No country wants another holding the purse.
54
@Sarah Johnson You seem confused about who is doing the bogeyman-ing here. This is a story about Malaysia, and the concerns that many Malaysians have about the impact of these Chinese megaprojects on their country.
It is true that the Western nations did similar things over the years (European colonialism, American neocolonialism). But I think you're again wrong that Western nations would be doing the same thing today if China didn't do it first.
China has a bad track record of throwing money at megaprojects that end up being ghost cities. I don't see a lot of these Western nations you speak of lining up to invest in Melaka Gateway or Forest City.
7
@Astoria22 Have you been in Tibet? If not, go there, talk to people there, and then back here to espress your opinion.
3
I dread to think of the deterioration of the quality of life of fellow locals should this humongous project come to fruition. The State lacks competence to deal with the massive influx of foreign residents competing with the already unsatisfactory amenities.
17
If you peel the onion some more and look at what made China attain this wealth that they are craftily using across the world, we in the west have to take the blame.
For many years now, we have become addicted to cheap Chinese products while US corporations have facilitated this. This in turn with China's manipulation of its currency, and with its government subsidizing its corporations every step of the way we are now caught behind the eight ball. China has totally twisted the WTO rules to its favor and past US leaders and corporations have willfully allowed it.
I do not support Trump on much but I do support him on his trade position with China. The only thing I am hoping is that he genuinely acts on it. China has to be held accountable and made to pay a hefty price for its underhanded actions.
22
China has been a good student of the west. China is using the same tools except outright invasion or colonisation to build up wealth.
The west cry foul when the student is now doing better than the masters.
What alternative is USA offering Malaysia? Freedom of speech cannot fill the tummy or send children to schools/universities.
9
@Konyagi
You over-estimate the importance of China's exports to the US to the Chinese economy overall. Yes, exports to the US are significant, and certain regions of China they generate a lot of jobs. But overall, they are just a drop in the bucket of the Chinese economy, and moreover the importance of these exports has been declining as the Chinese economies diversifies into other sectors.
Trump could cut off all trade with China, and China would still be just fine.
3
@Matt
Keep dreaming. You act as though the Chinese economy is consumer driven. It is not. Consumers are not mobile. Manufacturing and supply chains are.
China made its power play too early. At the current rate, it will be 2040-2050 before China passes the US, and that date only pushes out ever further as the Chinese economy continues to decline.
1
"Mr. Mahathir, 93, was voted into office with a mandate that included getting the country out from under its suffocating debt."
Really?? 93 years old elected into office? I have nothing against old people, but...
4
That 93 year old still has good memory, knowledge and wit. i have seen him answering tough questions from reporters. I cant say the same of the current US president.
1
Can the host governments charge the Chinese companies with complicity in the corruption and sue for damages? Sue for damages in the host country's court system? It seems to me that China can wind up owing countries like Malaysia for these projects or having to renegotiate on terms where the Chinese companies are required to either make the project pay for itself or they make up the difference.
5
I like how Trump is combating Xi head-on. I thought I would never say that about Trump. If he follows through and forces real change in China, I applaud him.
6
@jianwei
Shirley you must be joking, surely.
6
@jianwei I would be very surprised if he forces real change
They took every colonial powers playbook and refined it, then executed on it. Too bad it will all fall apart, as the communist system is built on a stack of lies.
5
Chinese investment is sneaky: they make deals with corrupt and inept dictators to build white elephants that are useless to the host country but ensure the transfer of enormous sums into the pockets of dictator family and cronies. This is how Rajapaksa, Pakistanis and Africans sold off their countries, with little to show for it.
Kudos to Mahathir for calling it as he sees it.
47
Compare that to outright invasion and colonisation from the West that was worse. Taking a project or borrowering from China is at least exercising of free will like a company over extending its financial position. The west plunder and took over lands and resources from local via colonisation was bad for the vanquished with long lasting impact (aborigines in Australia or Indians in Indian Reservations in USA).
4
Except this isn’t about the West. It’s about Malaysia and China. You are all over these comments arguing about the failings of the US while seemingly making excuses for China. Enough.
6
For reasons I could never understand, the Western media and governments fail to understand that China is a communist dictatorship, and deals harshly with anyone who rejects their authority. They must gain resourses from weaker neighbors in order to sustain and grow in power. If this means buying off corrupt governments or shear bullying, so be it. They dont care what many ctitics think. They will just censor you. China first is their MO.
13
@Pepperman
You're not wrong about China being a dictatorship, but you're wrong about it being communist. China is communist in name only. In reality, it is much more of a capitalist dictatorship, like Russia, the UAE, or Saudi Arabia.
5
@Pepperman
And Google, Apple and the rest of the Valley is happy to play their censorship game.
In response to BG who wrote "What a pity to have gotten out of the TPP agreement"
The TPP was primarily a measure to contain a rising china.
Here's the US secretary of defence, under Obama. quote
"In fact, you may not expect to hear this from a Secretary of Defense, but in terms of our rebalance in the broadest sense, passing TPP is as important to me as another aircraft carrier"
Ash Carter , US Secretary of Defence.
BOTH candidates, Hillary Clinton and Donald Trump came out against the TPP. Quote "Clinton came out against the TPP agreement one year ago Friday, two days after the Obama administration clinched the deal with 11 other Pacific Rim countries"
https://www.politico.com/story/2016/10/hillary-clinton-trade-deal-229381
The TPP, if it would have been implemented would have been somewhat useful to contain a rising China, but it did NOT address the root cause, which is the US trade deficit with China. It is this trade deficit that furnishes the dollars China uses to buy up strategic assets and increasingly interfere with US strategic interests.
You might not like this, but from a military, strategic point of view , Trump with his trade war, is doing more than the TPP would have accomplished.
5
What did the US or Malaysia government do for the people of Malaysia before Chinese projects? Almost nothing.
6
@Ted chy
Hardly true. Malaysian GDP rose well enough prior to China.
6
Mahathir is wise to be wary of both America and China and is smart to push back. Indeed both China and America's Wall Street have been playing Malaysians for fools by catering to corrupt leaders from both ends. Classic loan sharks on a global scale.
Islands for 700,000 Chinese citizens? That will give Xi a pretext to invade to "protect" its citizens just like Putin has done to invade Ukraine and threaten neighbors with Russian citizens.
Given the debt Malaysia has with China, the Chinese condo investors could just pay for the property in China. Then again, what will happen to those cities'-worth of empty sky scrapers in China?
"China is the latest power to try to share in the riches." Share? More like take over completely, like their ilk on Wall St.
The most obvious clue - as blatant as it is - that the Chinese projects and loans are a scam is their use of Chinese laborers instead of local laborers under Chinese guidance. What responsible non-corrupt national leader would allow and pay for foreign labor when their countrymen need the work - their income would also remain locally.
I supplied cold storage projects in Africa, sending an American project manager to supervise a local crew. We quickly lost business to the Chinese who brought in criminally inferior product - to our American made equipment - and Chinese labor at less than cost with locals.
They've been doing the same worldwide since the days of using Chinese labor instead of Jamaicans in free-zones in Jamaica!
22
"The most obvious clue - as blatant as it is - that the Chinese projects and loans are a scam is their use of Chinese laborers instead of local laborers under Chinese guidance. What responsible non-corrupt national leader would allow and pay for foreign labor when their countrymen need the work - their income would also remain locally." Totally with you on this point. All projects for development must involve local people plus technology or knowhow transfer to help locals move up the ladder.
3
This article gives one a false image of the true situation between China and Malaysia. For the last decade, China has been the major trade partner of Malaysia. The recent Belt and Road projects were inaugurated under the ousted Prime Minister whose government is accused of massive bribe-taking and corruption.
It is unlikely that any breech between Malaysia and China will happen with the incoming Malaysian Prime Minister who was in Beijing for the last few days. Comments suggesting China is acting like a "colonial" power are farfetched and frequently occur in articles written by western journalists. Malaysia is more likely to continue with China in the future but with a closer watch on their own bureaucrats.
14
@Pushkin China's pursuit of colonialism isn't far fetched at all. Check out what they're doing to Tibet. It's not a pretty picture.
5
@Astoria22 What colonialism? Tibet has been part of China since the Yuan dynasty (13th century). What has the US done to it's native population and lands?
1
@PKW
Say this to Tibetans! Everyone knows that China is the colonial power in Tibet and is arm twisting everyone into accepting it
China has been all about "economic colonialism", they buy up everything instead of going to war, like we Americans spend our money. They are freaking brilliant....and totally scary because economic colonialism is insidious and nearly unstoppable.
Good for Malaysia, now if Australia and Canada and the U.S. and Pakistan, etc.....would all do the same, maybe we may have something to say on the day China decides to enter the warmongering market.
I fear by then we will all be owned by China, one way or another (read about Hollywood and the Dalai Lama and Richard Gere)...perhaps Malaysia will then have to speak up for us at the U.N.
13
China's intention is not benevolent
12
Same as USA. From Malaysia we do not expect China or USA to act in the interest of Malaysia. USA pays attention to us because China is making progress in term of influence in this region.
8
Nice - Mahathir sounds like some kind of hero for pushing back against the hegemonic powers that seek to take over his country.
And a nice nudge for China - you want to take over poor countries with 'free' loans with large strings attached ? Hey - here's one country that says No.
A good example for others to follow.
P.S. a reminder - a sovereign country doesn't ever have to give away its land - another country says they owe money - so sorry - no money honey - wee too poor !
And – if you try to invade – we’ll simply ask democracy loving countries to discourage that.
4
How will Malaysia retain its independence in view of China's colonial intentions? If collusion, graft, and theft by the Malaysian PM led to what appears to be an invasion, does China keep their ill-gotten gains?
2
It's pretty clear from their actions around the world that the current powers in China are only looking out for themselves, at the expense of other sovereign nations. Recently, they have used the model of luring and indebting other nations to secure resources and power - Sri Lanka, Pakistan, Myanmar, etc. I'm glad Malaysia is waking up to this fact and is planning to push back against this neo-colonial approach. China could be a far worse colonizer than Britain and France... we know what they have done and are doing in Tibet and Xinjiang. China has, today, an inward looking government and they care little about integrating with the rest of the world or the fate of anyone outside their ethnic and geographic boundaries. Everyone needs to be wary of dealing with them.
10
@JohnHuffam The pearl-clutching that Americans do about China's economic endeavors are largely hypocritical since America would be doing the same thing to other countries had they the opportunity and competency.
I find the constant bogeyman-ing of China to be unpersuasive and tiresome. Concluding that China would hypothetically be a non-integrating colonizer seems to be nothing more than a projection of deep-seated emotions than an actual analysis of what could reasonably happen.
No country could be a worse colonizer than Britain or France, whose former colonies are still reeling to this day.
6
So far China has plunder less of Malaysia than the British coloniser.
5
Negative comments here about China apparently "victimiizing" weaker countries is ridiculous!
Where in the past , colonial powers came and took what they could and left, today China offers a path towards enhancing countries with much needed infrastructure that will facilitate growth.
Did the western countries provide loans to them or help them in infrastructure developments?
China is offering to build and transfer plus providing the much need capital to do so with loans to be paid out over a long time.
The issue Malaysia has with the projects that China has in them has little to do with their viability or China taking advantage of them. It's all about corruption of the previous government. Projects were priced much higher and the cream taken off . Nothing to do with China except that she probably knew somewhat of the corruption but went ahead anyway. But who is China to interfere or judge whoever is in charge of the country. She believes in non interference and MYOB policy. She deals with whoever the country has elected.
14
@FrazierCrane, you ask: "Did the western countries provide loans to them or help them in infrastructure developments?" Yes, they did. They built railways and other infrastructure. It was directed to the needs of the colonial powers and their companies. The profits were extracted by the companies. That continued under U.S. colonialism without legal colonies. The corruption of local governments is both a cause and an effect of this kind of relationship; the colonial power takes advantage of local corruption to get the concessions it wants, and encourages the local corruption in order to keep that system going. China is doing the same thing.
8
@Thomas Zaslavsky Precisely the point. Colonial powers built infrastructure to facilate their governance and pillaging. Is China doing that?
Colonial powers used force to take advantage of corrupt or inept governments. Is China coercing anyone ? Take my loans and skills or else?
How is China encouraging a corrupt system? She respects the country's leadership that has been democratically elected.
@FrazierCrane
Maybe the West isn't financing these projects because they aren't good projects and they have learned their lesson on funding such initiatives and have no interest in owning or leasing random ports around the world.
2
Malaysia got a point. Once dependent on a financial giant, it becomes mighty difficult to extricate from bad deals later on, especially when the enticement entertains non-self-sustaining endeavors. This is occurring elsewhere as well, just look at Bolivia, falling from the frying pan to the fire...when switching from the U.S. to, you guessed it, China.
13
The Chinese have been purchasing our shipping cargo terminals along the west coast. Yup. The last one being Long Beach, now owned by the Chinese Company COSCO, as of July '18. We're being colonized too. yay. Have they bought Disney yet?
33
I find interesting and ironic that so many readers comments contain statements of shame for previous similar actions by the West as a defense for what the Chinese are doing. Two wrongs don’t make a right. Anyone who thinks the Chinese are doing these investments for anything but their self interest are kidding themselves.
94
You're kidding??
@JRA Two wrongs don’t make a right™ - The international slogan that Western countries use to shame others for doing what they themselves have done.
8
The “TPP” was meant to put the brakes on China’s many silk roads & tentacles in Asia and the rest of the world. Trump and the Trumpians defeated that initiative for the wrong reasons The Malaysian 99-year “lease” grab by China should give everyone pause.
In the US, isn’t interesting how China is manipulating public opinion by pushing advertising agencies to use Chinese women as models and spokespeople in TV commercials for absolutely every product on earth. Chinese people exposure to the American public is meant to make Chinese faces abundantly familiar and normal, though they are such a small minority. This is how they took over Tibet. Han Chinese were shipped over there - the rest is history. Given the ease with which Russia has manipulated US public opinion, why would the Chinese not think that they can do the Russians one better?
11
@Sam
"pushing advertising agencies to use Chinese women as models and spokespeople in TV commercials for absolutely every product on earth"
Can anyone confirm this?
8
Despite their long history, the Chinese have no real experience as imperialists or colonizers. They needed to learn how to grow hegemony.
America has met its best student ever.
Now Trump is providing a master class in self-destruction: My way or the highway...albeit one paved in silk.
We can only hope.
12
@Yuri Asian
The current China is an empire - millenia of experience as colonisers and imperialists. Vietnam was a part of Chia for many years and Korea was a Chinese vassal state. Tibet and Xinjiang are currently chafing under Han rule and colonisation, Cantonese and other "dialects" are being downgraded in favour of Mandarin....does this not sound like the work of an imperial coloniser to you? Yes, they are all "Chinese" but read the histories and learn how they became Chinese - colonisation by an imperialist power.
10
@Mike Goldthorpe
Thanks for your reply. I think you're assuming Vietnam and Korea were discrete countries with distinct borders long ago. They weren't during pre- or ancient history. Vietnam was a territory various kingdoms fought over just like Korea. And China was also territory various warlords fought over. It's inaccurate to suggest China at the time of warring kingdoms was a single empire. It wasn't. Tibet? Tibet in ancient times was the most feared warring kingdom of all, with an army that at one point invaded China all the way to the walls of the Forbidden Palace. Tibet's invasion of China is how Tibet became a Buddhist theocracy. The fact is that China has been invaded and occupied -- most recently by Japan but most notoriously during the British Opium Wars.
I'm trying to figure out what your point is with Mandarin. China has as many as ten language groups and well over 200 dialects. It was Mao who mandated a simplified version of Mandarin as the national language. Mandarin was the Beijing dialect used at the Imperial Court. It's considered high status to speak Mandarin and to this day Chinese parents, particularly those who speak Cantonese, have their children learn Mandarin.
It's a bit ironic for you to live in New Zealand and accuse China of imperialism.
1
A troubling look into the greed of Chinese and Malaysian congolromates. Sadly, this is something we have come to expect from faceless congolromates/corporations and this should worry us all.
Though it needs to be noted that the debt trap formula is a Western innovation and one which is employed ruthlessly across the globe by the World Bank and IMF.
18
The BRI is a plus for receiving nations but not unless a firm mind is sitting on the other side of the table for China is not a generous nation but is a capable one.
Malaysia appears to have find leadership capable of posing questions of cost-benefit nature, and even under a crooked government had stopped damn construction projects when local oppositions raised issues of feasibility.
The push for projects will continue to be relentless as the railroads end is on the Indian Ocean an ancient desire of Chinese commerce; Malaysia should extract a high bargain in return and can.
2
Port investment makes sense but could it be done without huge loans?
If I am the owner of goods and the owner of ships, I'll have influence on ports. If I have influence on ports and ports are huge industries on its own, I would like to have a share in that port's business. Malaysia is just as good a location as Singapore, it's cheaper and ports are not well developed. Developing ports in Kuantan and/or Melakka would seem a good investment.
Could China just get a share of profits or could there be any other way to organise this without creating a dependence with longterm loans?
1
To answer my own question:
The Government Advisory Council (CEP) will advise the government that the East Coast Rail Line (ECRL) project will be privatized if it still insists on resuming the project.
http://malaysiagazette.com/blog/2018/08/20/jika-mahu-teruskan-ecrl-kena-...
1
Whoopee! Finally, one country's leaders have had the temerity to tell the Chinese they're not for sale. But, thanks to our own feckless leader, the U.S. isn't even countering Beijing's lust for power and profits. Trump is allergic to economic alliances with other nations and thereby leaves them wide open to China's tender embrace.
19
@Stu
And why should we be countering China's 'incursion' into it's neighbors economies? China's playing a game that petered out in effectiveness around the 1960's. Just like Japan blew billions in the 1980's in dud investment here in the US and around the world, so is China doing the same now.
The real worry should be not so much about when China implodes. Rather, it's how much of its implosion will be contained to the mainland versus spilling in to regional and global economic, and worst case, military calamity.
8
@Agent Provocateur: Trump's pulling us out of the Asia Pacific trade pact has given China the opportunity to jump right in. I'm not talking about intervening in anyone's economy but rather about creating partnerships that would have the effect of nullifying China's influence.
Dr. Mahathir has shifted his Look East policy from Japan to China, as another reader has pointed out, and even the generally balanced Malaysiakini news outlet makes no mention of the country's pushback on China's white elephant projects in Malaysia. nor Mahathir's warning that he's not into a "new version of colonialism" and that he doesn't want to see any warships near his country. It's all "Oh, let's emulate China's brilliant entrepreneurs and hard work."
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Those Chinese aircraft carriers are just the start: two in service and more on the way. China will exploit American political paralysis and awful “leadership” to dominate the region, as the US did for decades in Latin America.
It will as likely as not end in a Pacific War we may well lose, given China’s cyberwar capacities.
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War can be avoided if USA respect China's safe space and keep to USA's own safe space at eastern side of Pacific.
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It is obvious. Countries are going to start rebelling against Chinese colonialism playing the same game as the IMF and the World Bank, making or forcing loans which cannot be paid.
It is also obvious that the US and China are going to be banging heads in the not too distant future over Taiwan and the South China seas. When a failing power like the US is being challenged by a rising power like China, there can only be one outcome i.e. WAR. Who will win? Probably China, because they have sympathetic 'agents' everywhere. Although, when nuclear weapons are involved, no telling who wins in the end (I mean the REAL end- of all of us!).
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All these man made islands and no concern for global flooding as well as all that on shore building. Amazing. Why's minding the rice paddies?
Using Malaysian corruption to bash China is unfair. It's entirely up to host countries to set terms for bidding, local labor force participation and guarantees. If local politicians steal project funds, that's a local problem, too, and as common in Spain as in Malaysia.
And Sri Lanka's problem, "compelled to hand over to China a 99-year lease on the port and more land near it, giving Beijing an outpost near one of its busiest shipping lanes" is one negative result of 'democracy'.
The newly-elected government had received neither credit nor kickbacks from the project and was horrified that the airport would carry the name of a political rival, so refused to pay for it. The Chinese then offered to take them out of the loan they had incurred by paying them, in advance, for the right to operate the port.
Sri Lanka's sovereign ownership of the port is undisturbed and the port complex will release an internal trade bottleneck. The Chinese, by operating it as they do Greece's Piraeus, will make it thrive.
Rather than the lose-lose proposition this article suggests, 99% of Chinese overseas investments are win-win.
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@godfree American and Europeans are not allowed to freely where and deal with corrupt regimes and the IMF has controls. Sorry China is guilty of enabling corruption. On day a country will say No and they we will see the real face behind these investments. Corruption is rampant in China and seems to now be a major export.
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@GUANNA
USA has been supporting corrupt regimes all over the world as long as they are USA's corrupt cronies regimes. This is like pot calling the cattle black. USA had turned a blind eye to weapon smuggling and openly support corrupt practice by using USD to pay off warlords in Afghanistan to try to buy loyalty. When Donald Trump said "You think our country's so innocent?" during one TV interview with FOX. It was an admission that USA should not pretend to have moral high ground. (https://edition.cnn.com/2017/02/04/politics/donald-trump-vladimir-putin/...
This is lack of nation-state financial planning at it's best.
Crony capitalistic governance enacted by Asian countries and their imbecile leaders over the past 10 years have allowed countries such as Pakistan, Sri-Lanka, Malaysia, Myanmar and others take up huge piles of dollar denominated debt onto their balance sheets. Now they are waking up and realizing that they will be unable to pay these debts. As interest rates rise, or as the dollar gets stronger, the financial situation of these states will only get worse.
Thank God(s) India has repeatedly rejected China's OBOR 'aid'. Last thing the US needs is Asia's largest democracy indebted by Chinese loans and compromise it's sovereignty in the process.
Japan, Australia and US must share some of the blame in hindsight. They should have better advised their Asian allies. Now the result is their inevitable waning influence in Asia.
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Econ 101:
Q: Where does China get all the $'s she uses to invest strategically?
A: The trade deficit in 2017 with the US was $ 375 million
Those $'s are used by China increasingly not for commercial purposes but for military purposes to build up a blue water navy to control the South China Sea, to the consternation of its neighbours, and military bases everywhere possible in Asia to counter US influence.
Macro economists who championed trade with China on commercial grounds missed that the $'s might flow into "Make China Great Again"
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@Woof
You meant 375 billion, not million.
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@Woof
Actually the Chinese used $3 trillion to buy US Treasury notes, currently valued at over $1 trillion. Also, there are over 800 billionaires in China (easily lapping the US at 600) who collected much of the alleged trade surplus, not the government. The Economist estimates the average overall taxation rate in China to be 30% across corporate, VAT, income, property, agriculture, and custom fees (which means the tariff on imports from the US goes to the Chinese government for which Xi is eternally grateful to Trump).
The alleged surplus is just that: alleged. Even The Economist, leading Sino-skeptics, contends that the surplus is misleading and the balance of trade between China and the US is about equal.
Remember: the dollar amount includes the value of every iphone assembled in China but owned by Apple for sale in the US. Profit from the iphone accrues to Apple and its shareholders, not China. And yet it's counted like a Chinese product owned by a Chinese company that exports to the US and pockets the profit back in China. That's just Apple. A thousand US companies also assemble or manufacture in China and have their American-owned products counted as part of China's trade surplus. Penalizing the Chinese for business decisions by US companies to manufacture in China makes no sense.
The answer to Woof's question is that China gets the money it uses for its military exactly the same way as the US does, which is by taxes collected by the government.
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@Woof It’s peanuts compared to the $1.2 trillion in US debt owned by China.
Forest City is right across the border from Singapore. Singapore (75% Chinese ethnicity) gained independence from Britain as part of Malaysia but then became an independent city-state because of conflict with Malaysia (2/3 Malay, 1/4 Chinese). I wonder how that is going to play out.
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It seems the Chinese have hit upon a pretty slick formula. Find a much weaker country with a corrupt leader. (I think there are more than a few of those.) Make huge loans that are siphoned off by the corrupt leader. Offer to forgive the loans in exchange for real estate. Transfer your citizens to the real estate. If and when necessary, defend your property rights militarily. Incorporate the country into your political hegemony. And voila! Instant empire.
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@Enabler Now is that different from IMF lending schemes engineered by the US?
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@Enabler Exactly what happened in the Bahamas. Type in "Bahamar" and China Export Import Bank if you care to see how the Bahamian gov't was used and abused (sold out the people and took the money - to their shame.)
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@Enabler How is it different from what the United States has done in decades and centuries past? The only difference I see is that the US has more private capital and China uses more state-owned businesses.
The West simply does not want competition for business and strategic influence from China. This strikes me as a well researched and reasonable article, except for the fact that it plays the game of the West - critically report on China for beginning to be successful in the approach taken by the the colonial-imperialist West. The US and the West want to compete by not letting anyone else play the games that have worked for them. At least China so far has not engaged in the blatant political manipulation and control the US is famous for. Exactly how many governments has it overthrown, how many uprisings has it facilitated and financed, how many endless wars has it engaged in?
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@Daniel Yakoubian Well, it absorbed Tibet for one, has taken Indian and Pakistani territory for two, has eyes on Taiwan for three, has been asserting crazy ownership and creating military Islands in disputed areas of the South China sea for four, and now with all these sketchy "investments". I'd say it shows every sign of ramping up to aggressive manipulation and expansion of an imperial power. What has changed? Maybe people have wised up and don't want to be the victim anymore.
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@BarryG Tibet once absorbed much of Western China and the Dalai Lama still claims suzerainty over it. Tibet has never been a separate nation, ever.
China has never taken Indian or Pakistani territory, and its SCS claims are more soundly based than other claimants'.
It's investments in other countries have been remarkably beneficial: the leading authority on aid to Africa, Dambisa Moyo, says Chinese aid has done more good for Africa in the past decade than Wester aid in 100 years.
Maybe people have wised up and don't want to be victimized by us any more?
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@godfree Regarding China taking Indian and Pakistani territory: Look for articles about Aksai Chin and China occupied Kashmir.
Red China is well known to use money, women and all the other dirty tricks to buy over people to push through their agendas. Their way is quite effective, especially in less developed countries, even in many cases, the Red China activities actually do a lot damages to the local hosts.
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@James Flynn It can never be topped by the concession China gave Hong Kong to the UK in the name of Free Trade for Opium. The West is no different. Did you forget your history lessons?
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@Sam; Pardon the cliche, but...two wrongs don't make a right.
And this isn't the 19th century.
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@Sam
You're right except Honk Kong was seized by Britain after the British armada threatened the Emperor, along with 18 other concessions distributed to Western powers...Portugal got Macau, Germans got Tsingtao (where they built a world famous brewery) and the Italians got Tianjin, where my family lived in an Italian manse.
The Opium Wars weren't about from free or fair trade (which didn't exist during British Empire). The English forced China to accept opium in payment for tea (the caffeine that powered the English Industrial Revolution) instead of the agreed upon silver. England's had all this colonial opium grown in Afghanistan they had no use for so they pawned it off on the Chinese, who balked until the British armada showed up. The British humiliated the Emperor, who had no military capacity to wage war, by seizing sovereign territory and turning millions of Chinese into opium addicts, which insured a market for British-Afghani opium.
There's a direct line connecting China's abject humiliation by Western powers and a China that will never be bullied again.
Luring countries into debt traps...didn't the U.S. write that book? (See Confessions of an Economic Hitman and the exploits of The RAND Corporation)
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Thank you, good article. Exactly the same is happening in Cambodia. Reverse Hong Kong.
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BRI is an effort by the Chinese government to export its excess construction capacity and get other countries to pay for it. Most of these projects are white elephants and will never generate enough revenues to pay for themselves. In modern times, it is not possible for one country to demand repayment from another at gun point. The western countries have the IMF, which does the dirty work for them. China got Sri Lanka to give them a 99 year lease on Hambantota, but the fact remains that it is white elephant no matter who owns it. China will ultimately have to write down much of its BRI lending which may put an end to its adventurism but not before it pushes the world into another financial crisis.
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He that lieth down with dogs shall rise up with fleas.
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That area is going to be underwater in 15 years.
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Loans? Malaysia should be charging China rent.
Kinda sounds like the US. Corrupt Republicans cripple the economy, and Democrats must fix it.
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That “obscure” autonomous region in China, Guangxi, is on the coast of the South China Sea and has a matching port project that is explicitly for trade with Malaysia.
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Today’s (August 21) Asahi Shimbun reports that Mahathir’s visit to Beijing successfully avoided confrontation. The railroad and 2 pipeline projects were set on paths to soft landings. Mahathir stated that Malaysia is shifting its “look East” focus from Japan to China.
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China best forgive most of those loans to Malaysia .
Nice trick if you can colonize a neighbor and get them to agree to pay for your military bases. It’s amazing what a corrupt regime will agree to. Their forests are already mostly boards run through Chinese sawmills. Now they want harbors and bases as well.
If we had a president that would work with the foreign service ( not the Russian one ) we’d come in as a white night for Malaysia. As it is, we’re yielding the pacific to China day by day.
Make America a colony again!
Vote as hard as you can.
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@RjW "White night." LOL! I see what you did.
2
What a pity to have gotten out of the TPP agreement. China is muscling in the vacuum we have created.
Hopefully Trump will be kicked out soon so that we can get back in some sort of TPP and mend our issues with Europe. This is the only way, in my opinion, to force China to be a responsible country.
We are passed the age of warring against each other.
We all have more pressing problems such as Climate Change and, let us face it, we need to grow up and abandon this mentality of sending our youth to fight devastating (for everyone) wars.
Trump is evil and an idiot to boot. Let us get rid of that little ersatz of a man-boy!
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@BG
I don't know how you come to the conclusion that TPP would have prevented this. Corruption is corruption.
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TPP is about non tariff barriers so it raises trading standards, recognise unions, improve labour laws, establish dispute settlement etc. In short make these countries raise their quality of life to that of developed nations so they may trade inside TPP? For countries like the US, it provides a fairer trading environment, and levels the playing field. So when China has to start playing fair and not impose non tariff barriers to US imports
A lot of people do not understand that TPP is of great benefit to the US because it makes America more competitive and for the other countries, greater trading opportunities for all
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And how did the venal practices of China, which have been going on well before 2016, suddenly become the fault of DJT being elected president?
Your comment is typical of liberal blinders to all things Trump, even when he's calling it like it is and making changes that are good for the US and the world (like pulling out of the nonenforceable and meaningless Paris Accord).
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Good for them. I wish we had done the same.
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Citizens of the third world, choose your leaders very carefully.
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@Bobb Such as the way we in the US did?
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@Bobb One look at President Donald Trump's Twitter feed and you could say this applies to developed countries equally.
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Citizens of USA choose your leaders carefully
China, like many great powers, doesn’t do anything that is not for its own benefit; all those projects abroad either provide income - receiving payment for the project and often hiring its own nationals rather than those of the country where it takes place - or, to provide natural resources for its industry. Just as Western powers ‘help’ developing countries by installing various corporations.
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Malaysia stay away from China! You don't need the new railroad in your East coast. Stay away from colonial Chinese Communist money. China is now under the leadership with underworld style. Don't be a blackmail victim of Xi Jinping, the Al Capone of China. Don't be a crazy rich Malaysians. Let people in Singapore continue to be Crazy Rich Asians. I am glad Malaysian Federation didn't work out many years ago.
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I've been worried about China being a house of cards for years. This type of irrational building has been happening for a long time, including a manufacturing base that provides jobs, with industries that use far more laborers per equivalent dollar of sales. All while building massive military projects. What happens when other countries wake up as well? What about not being able to stockpile all the excess basic goods being produced, and jobs go away that sent money to rural populations that are already restless? Don't get me wrong - I think China is an amazing country. The issue has always been that while I hear it said that China takes the long view, the reality is they are FAR too impatient to become some ego-driven super power rather than taking the time necessary to build a solid foundation. I'm guessing I've been feeling this way for five years or so. I see some major Soviet style upheaval in the next ten years, with the trigger being global recession. It will be bad.
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I couldn't agree more that China is heading for trouble. Lest we forget, China's history has wildly swung between hegemony and innumerable factions fighting each other. It was not that long ago that Communist and Nationalist were battling for supremacy on the mainland.
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@David, I have no idea whether you're right, but it's a thought worth keeping. Remember when Japan was about to take over the world? That was about 30 years ago.
1
The article is wildly slanted against China; how sad.
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@Nancy
I worked in China and Malaysia for a number of years and my take is this article is accurate and to the point.
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@Nancy Specifics would be appreciated.
What China is reported to be doing is very similar to what it is doing in Laos and Myanmar.
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@Nancy
The truth hurts.
Malaysia isn't the only country having second thoughts about Chinese "investment";
Sri Lanka just gave up a port to China because they were heavily indebted to Chinese banks and their government is now facing Sri Lankan citizens anger,
Myanmar(Burma) , Indonesia , Kenya and now even the Philippines are beginning to wonder exactly who really benefits from Chinese investment, and they're realizing it isn't them.
The BRI is finally being exposed as a land grab by China, nothing less.
Thanks to the NYT for shining light on this very important issue, and we look forward to more reporting.
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What a shame Jarred Kushner can't get New York city on that 'Belt and Road' initiative.
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@Richard Mclaughlin The night is young. Never be so sure that the Kushners will not rise up again under the father-in-law and liar-in-chief.
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The U.S. imposes sanctions on a country and then threatens other countries who do not abide by them. That is domination in action, so dear N.Y.T., don't worry so much about China.
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@Andreas, The NYT is not "worried". They are journalists reporting factual information. What you picked up on is the actions of the Chinese gov't which are worrisome to many smaller nation states in the Pacific Rim.
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@Andreas This wasn't an article about mistakes the US is making - there are plenty. The scale of the China problem, however, could be far more massive. Ours could be mitigated by sound leadership. China has the feeling of a speeding train and they're trying to build the track in front of it.
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@Andreas we can worry about more than one thing at a time.
6
Sounds like Malaysia realized China's trying to get in on some neo-colonialism, a la John Perkins' "Confessions of an Economic Hitman."
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Alex. Good call. I was gonna mention that book but couldn’t recall the title. I’m sure the Chinese have studied it closely.
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@Alex Cody
"China's trying to get in on some neo-colonialism, a la John Perkins' "Confessions of an Economic Hitman.""
Once again China can't come up with anything original - just copying ideas from the west and then selling the product overseas.
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@IPI, that is silly. China has originated a great many ideas. (E.g.: Printing. Rocketry. Detective novels.) Of course, in a sense there is nothing new about "economic hitmen", but China has its own, better organized way of doing it.