Why China doesn't mind the war in Iraq
Source By Antoaneta Bezlova
BEIJING - A less vociferous than expected response to the war on Iraq from Beijing reveals that in weighing the consequences of the conflict, China is torn between its fundamental strategic policies and economic benefits.
As part of a permanent strategy to oppose "US hegemonism", Beijing consistently sides with any country punished by Washington and time and again has tried to thwart any US efforts to pull together a coalition in the United Nations against any other state.
As much as China fears it could easily become a future victim of such punishment, for more than 20 years it has also sought a peaceful international environment to pursue its economic reforms. Ironically, China stands to be among the economic winners from the current conflict.
"There is a silver lining to the war," admitted He Maochun, professor of foreign trade relations at the People's University in Beijing. "We should set our sights on winning contracts for Iraqi reconstruction after the war. Our model is South Korea in the 1980s - they built a highway from Baghdad to Amman and after the Gulf War in 1991. They undertook its reconstruction."
He said the 1991 Gulf War resulted in a loss of 33 percent of China's labor and engineering contracts in Iraq. But the years since the partial lifting of UN sanctions in 1996 have boosted the resumption of bilateral trade and commerce.
"This time, we need to be even more proactive and seize the business opportunities that will arise after the war," He said. Hopes to win handsome deals when the oil-rich country begins to rebuild its civilian infrastructure are just part of many gains China could get from the war in Iraq. Acceleration and concentration of foreign investment is another one.
"As the Iraq situation may have a bigger impact over a relatively longer period than most people expect, international investors are likely to transfer more of their money to safe investment destinations such as China," said Wang Jian, an economist from the Institute of Macroeconomy under the State Development and Reform Commission.
The trend is already visible from the official figures released by the Chinese government this year. Foreign direct investment jumped nearly 54 percent in the first two months of 2003. Pledged foreign investment rose 59 percent during the same period. This marked increase comes on the heels of a record US$52 billion of foreign investment China attracted in 2002.
More than anything else in the aftermath of the war, China is concerned with securing low oil prices when or if Iraq's oil exports come under US control.
Since China became a net oil importer in 1993, its imports have risen steeply and are now essential to sustaining its high economic growth rate. In 2002, imports rose 15 percent on the year. Last year China imported 71 million tonnes of oil, half of which came from the Middle East.
To avoid becoming over-reliant on Persian Gulf oil, it is pushing ahead with long-term plans to contract oil and gas from Russia, Indonesia, Central Asia and Australia. Meanwhile, Beijing has taken a series of measures to guarantee that the war does not disrupt the steady supply of oil and does not cause huge price fluctuations in the market.
China's three leading oil companies will import oil from Indonesia, Sudan and Venezuela, Yang Wencai, deputy secretary general of the China Petroleum and Chemical Industry Association, told the People's Daily. China is also reopening oil wells sealed previously because of their relatively high production cost.
Economic worries and calculations have dominated the state-controlled Chinese media ever since the first bombs began falling over Baghdad last week. But nothing of the climate of indignation whipped up after the US-led bombings of Iraq in 1998 is visible nowadays.
Beijing's official reaction - one of opposition to the war and the violation of the UN charter - was featured prominently on the front pages of many newspapers, but somewhat dwarfed by the amount of information provided on the scope and speed of US-led military action.
"War-related special publications have become hot commodity," read the headline in the Beijing Youth Daily on Saturday, noting the unusual interest with which Chinese readers have taken to the news of a war being fought far away from the country's borders.
One reason for this brisk newspaper business is the unusual lack of restrictions on the war coverage. Instead of trying to censor media reporting that might inadvertently commend the US military might, Chinese propaganda officials have opted for sending an unprecedented number of correspondents to the conflict region to provide a Chinese perspective on the issue. Some media have openly carried reports on what Chinese military could learn from the US war in Iraq.
Indeed, the first Gulf War helped Chinese military discover a lot about the US way of fighting a modern, high-tech war, said Liu Dingping, a researcher with the Strategic Research Center of the People's Liberation Army Military Affairs Statistical Institute.
"This is the fourth war the United States has waged since the end of the Cold War, but there is no reason for the Chinese military to feel ... inferior," Liu said in an interview with Guangzhou-based newspaper Southern Weekend. "With each new conflict, we draw our lessons. The bigger the number of military actions with US involvement, the smaller the gap between the US and China military."