How will China react to lost investments?
JMA posed an important strategic question, albeit with application beyond Afghanistan:
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The Chinese approach has not been tested. When the regimes (who have been bought by the Chinese) fail to protect the Chinese 'investments' (which are being more readily seen as the looting of national resources) or the regime changes and the new one also wants a piece of the action we will see how the Chinese react.
This issue appeared once briefly at an Oxford conference on international terrorism, in the Africa session; remarks were made about the Tan-Zam railway and the social consequences with dual heritage / mixed race children.
We may have a test case in Zambia, where in a democratic election the new President has indicated a different stance on foreign investors:
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..he has frequently criticised foreign mining firms - often from China - about labour conditions. While the party has disputed media reports that it is anti-Chinese, his election is likely to shake up the way contracts are awarded, our correspondent says.
Link:http://www.bbc.co.uk/news/world-africa-15039094 For more on the new President: http://www.bbc.co.uk/news/world-africa-15034694
How will China react to lost investments?
A couple of posts have appeared in a thread on the war in Afghanistan, but raise questions and issues that IMHO need their own thread.
There is to my knowledge little history of China losing overseas investments, partly as it has exported people, not capital. Other nations have considerable history of losing investments, notably post-1945 either in giving up colonies or nationalisation of assets and quite a few small wars have ensued.
Why does China invest abroad?
My understanding is that China decided a few years ago that returning it's income from exports to China would set off inflation, alongside distorting its planned investment strategy and it sought non-Chinese investments as a potential source of income. Many of those initial investments were not in natural resources; the only one I can recall was a mobile phone provider and this led to serious concerns over national security.
Zambia is only one test case
China's foreign policy is immature and while many nations desire increased Chinese investment, they are also tiring of China pursuing its naked economic interests at all costs. China, just like the powerful countries in the West, will have to learn to adapt its foreign engagement policy if it wants to remain a significant player in the global arena.
http://democracyforburma.wordpress.c...r-yale-global/
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CHIANG MAI: At a time when Asian countries are increasingly worried about China’s growing assertiveness, Burma’s rejection of a huge Chinese hydroelectric dam project has raised new questions: Is this a rare victory for civil society in a repressive country? Or does it indicate an internal dispute over the country’s dependence on China? Regardless of the answers to these questions, the public difference over a close ally’s project marks a new stage in the Burma-China relationship.
On September 30, Burma’s new president, Thein Sein, sent a statement to the country’s parliament announcing that a joint venture with China to build a mega-dam in the far north of the country had been suspended because “it was contrary to the will of the people.” The US$3.6 billion The Myitsone Dam would have been world’s 15th tallest and submerged 766 square kilometers of forestland, an area bigger than Singapore.