China & Development Alternatives

Patrick MarrenKimmage Development Studies Centre,

Dublin,Ireland

China & Development Alternatives

Outline

Images/Impressions of China

Historical China - Admiral Zheng He

Comparative Development – India and China

The Dragons Gift - China in Africa

China - Future?

China & Development Alternatives

What comes to mind when you think of China?

Do you see China as playing a positive or negative role in world affairs?

Do you think China will become more like the West as it gets richer?

China & Development Alternatives

C15th Chinese ExplorerAdmiral Zheng He

Zheng He's Treasure Ships

Zheng He & Indian Ocean

Admiral Zheng

Series of Expeditions 1405 to 1433

4th Expedition – Malindi Kenya

28,000 men, 60 Treasure ships over 120m long and 50m wide, and 190 support ships

Trading Gold Porcelain and Silks in exchange for Herbs, Ivory, Myrrh and Giraffe

Past and Present

Zheng He's Expeditions – No bloodshed, colonisation or plundering

Peace, Friendship and Openness – Themes pushed by China today. China is not to be feared

Chinas Success

Today China is The most populous country The biggest exporter The second biggest economy Has taken 300m out of poverty

“With great wealth, comes power”

Historical Progress – Comparison with India

China Indep. 1949 Revolutionary

Socialist

India

Indep 1947

Parliamentary Democracy

Nehru 1954

“We differ in our political and economic structures, yet the problems we face are the same. The future will show which country and which structure of government yields greater results”

China and India

Broadly similar inheritance Mass rural poverty with feudal structure Acute embedded patriarchy – flagrant gender

violence – infanticide, foot binding, child marriages

High Inequalities Limited Industry, with low productivity

China and India

Differences China – culturally homogenous 90% Han One dominant language 2000 years old history

Acceptance and legitimacy of State

Commonality of socio-cultural orientation and interests

China and India

Differences India – Mosaic of Languages, cultures and

religions, further fractured by caste and class Singh (2000) Survey

4,694 communities, 13 languages spoken by 10m+, another 29 by 1m+

China and India

Power China – Based on peasants and workers –

CCP supporters India – Middle and Upper classes- Congress

Party supporters

China and India

1950 China India

GDP pc ($) 65 62 Labour (%)

Agric 77 72 Industry 16 17

Who won?

HDI Life Exp Schooling

GNI pc

years years $ ppp (2008)

CHINA 89 73.5 7.5 7258

INDIA 119 64.4 4.4 3337

Who won?

Literacy 2nd Level Enroll

3rd Level P/T ratio

% 15+ years years

CHINA 93 74 22 18

INDIA 63 57 13 40

Who won?

Agric Yields Wheat

Kg/ha

CHINA 4155

INDIA 2688

Chinese Success

Saith (2008) Development and Change

Institutional Framework India – Rigid and a constraint to development China – A prime target variable – refashioned

to accelerate growth

Land reform

India – Never took place, minimal effort, beneficiaries supporters of CP, killed off further reform

China – Massive with terrible human cost

Great Leap 1958 – 62

1959 Collectivisation not working, replaced by commune sys.

Land reform

1978 – Household Production System 3 types of reform tried 1980 – Bao Gan Dao Hu -favoured 1982 – 70% of HH practising

China Aid

China – major donor Secretive & not DAC member Concerns over impact – Human rights, Debt,

Governance

China Aid

Aid from China – Long History To counter USSR & USA Three phases Large Scale Aid projects – Tan. Zam Railways,

Dams etc – Favoured by Mao Very expensive – 5% of GDP by 72 Not successful

China Aid

2nd Phase Rehabilitation of old projects and joint

management 3rd Phase Privatisation of old projects, and joint

commercial ventures

Aid and Trade – China sees aid as benefiting both its industries and host nations

China Aid

3rd Phase Old Industries encouraged to move to EPZ Textiles and Plastics – no tax rebates Host state identified – Mauritius, Nigeria,

Tanzania etc Provided employment, provides exports,

provides market opportunities

China Aid

Chinese Aid Barter and Projects

Angola & Sudan – Major Chinese investment in infrastructure in exchange for oil

Ghana – for cocoa

Saves foreign exchange, limits corruption

China Aid

Operating Principle Non intervention in State Sovereign Issues

Human Rights and Governance concern

China as alternative – hinder change

China Aid

Policy Space – DAC alternative 1980's and 90's – 95% of Aid from DAC DAC – focussed on Neoliberal agenda Aid for Policy change – Structural Adjustment

Programmes & Governance Little Aid for Industrialisation or Agriculture

China Aid

DAC – Aid Effectiveness Paris and Accra Declarations Ownership Alignment Harmonisation Predictability

YET in reality, DAC DONORS DRIVE AGENDAS

China Aid

2000's – Global Growth Resource exports boom BRIC's – New donors - “Poor but Powerful” China – biggest and attractive

Forum of China and Africa Cooperation

China Aid

China – Africa a market not basket case African perception of China as an equal, who

gives respect

China Aid

China Aid still small, Export Credits bigger China's own lesson

“To end poverty, build a road” China's current aid practice based on own

experience of aid and development

China Aid

China Aid still small, Export Credits bigger China's own lesson

“To end poverty, build a road” China's current aid practice based on own

experience of aid and development Its consistent and conditionality free

China Aid

China Chinese Imports are a threat, but Chinese “Investment” aid has rehabilitated and

strengthened industries in host countries

“To end poverty, build a road” China's current aid practice based on own

experience of aid and development Its consistent and conditionality free

China Aid

China Is a powerful force in Africa and there for the

long haul. It is strategic and planned Ultimately, African Governments will the say as

to whether these interactions benefit their citizens

China & G20

China & US relationship - main global play

US – Bad saver, big consumer

China – Big saver, bad consumer

2000's US trade deficits with China, funded by China

China – Hold $2.5 tn in reserves China – Seen as unfair player – exchange rate Trade tensions in 2009

China & G20

China's focus on exports – weakness Rising internal tensions – Inequality, Rural –

Urban divide, Corruption, Nepotism Needs growth to placate population, address

inequality, etc

But cannot rely on exports Must revalue currency, encourage domestic

demand – 35% of GDP currently

China & G20

G20

19 countries plus EU (also invites IFI's) Replacement of G8 Represents 2/3rds of Global Pop, 80% of

Trade and 85% of GDP Centre for Global Governance

China & G20

Pittsburgh Summit – G20 focus

Framework for Strong, Sustainable, and Balanced Growth

Strengthening the International Financial Regulatory System

Modernizing our Global Institutions to Reflect Today's Global Economy

Reforming the Mandate, Mission, and Governance of the IMF

Reforming the Mission, Mandate, and Governance of Our Development Banks

Energy Security and Climate Change

Strengthening Support for the Most Vulnerable

Putting Quality Jobs at the Heart of the Recovery

An Open Global Economy

China & G20

For China

G20 – a recognition of its global power status – cloaked in appearance of a broader rebalancing of Old and New powers

G20 – takes spot light away from China, slowly growing into its role, but still uncomfortable with this new power

China & G20

Q: Will G20 sit above BWI’s? As steering and reforming institution

Possibly – it’s globally representative, more authoritative and legitimate than previous G groups

Includes Old and New, comprises most of established and emerging powers, producing most of the worlds output, but small enough to reach agreement.

China & G20

USA - Worried about “Multipolarity without multilateralism” Old Global institutions ineffective, not representative, in capable to dealing with new millennium challanges.

G20 with a nested G2 offers a way of meeting those challenges

Sino-US relations – remain most important in terms of global impact, but focussed on economic interests rather than geostrategic rivalry

China & G20

China – Views Will collapse Will become like US & Europe Will survive as China

CCP – Lesson from Tiananmen Refuse equal dialogue with society Fear for breakup of CCP unity – closed ranks,

debates now internal But its shown to be receptive to change to maintain

survival