Will the ‘China solution’ answer the world’s woes?

America once sold dreams, now China wants to sell solutions. Might this be the very template for a world, disrupted east and west by change, and seeking a quick fix?

Trump continues to glower at the Chinese, via Twitter, for the trade imbalance and North Korea’s increasing bellicosity. 
The uncertainty is compounded by a sense that the United States and China are awkwardly trying to ease into each other’s space –  Trump’s America away from the international order it has led from 1945; and China signalling that it will shoulder more of that burden. Unlike past summits, the mood music, too, is different. This time it is the Americans who are singing the blues about the international rules that govern trade and even about carbon dioxide emissions; China is resolutely backing them. Led by Trump, an inexperienced politician with a tendency to angry outbursts, the US appears less steady and reliable for anxious allies than  Xi’s China.
Is it time then to take seriously the so-called "China solution", a phrase  Xi first used last year to assure the world that China has a fix for everything? The Chinese people, he said, are "fully confident that they can provide a China solution to humanity’s search for better social institutions." It was a vague prospectus and certainly much less well-defined than America’s decades-old message to the world – that it will act in the defence of freedom, liberty, free trade, democracy and human rights. He said it in July when the US presidential election still seemed to be Hillary Clinton’s to lose. No one but the Chinese took it seriously at the time but now, with  Trump in the White House, things have changed.
America once sold dreams, now China wants to sell solutions. Might this be the very template for a world, disrupted east and west by change, and seeking a quick fix?
What might a "China solution" mean anyway? First, the status quo on globalisation, with China possibly investing more, if strategically, overseas, especially in the US. This would accelerate a process well in train for the past five years with China as among the top three export markets for 33 US states as the result of piecemeal deals. 
Obor" is not the name of an ancient king or kingdom, but it does resonate with an ambition imperial in its scope.
Obor – One Belt, One Road – is China’s "new Silk Road" and is spinning a web of connectivity by sea and land across Central Asia and into Europe. Its ports, pipelines, railways, roads and airports are a priority for Beijing.
Launched by president Xi Jinping in 2013, it’s a vision that in its potential exceeds that of the Marshall Plan. Chinese officials are, however, quick to downplay such comparisons, for two reasons. The plan that helped Europe emerge from the ravages of the Second World War, they say, was Washington’s way of rewarding friends. Obor is non-political, they claim. Secondly, it involves much more money. The Marshall Plan in today’s value amounted to less than $100 billion (Dh367bn). Some estimates put the value of Obor projects now being built at just less than $1 trillion.
Obor is already extending Chinese commercial influence and reducing the Chinese economy’s dependence on investment in infrastructure at home, and allows it to export some of its vast excess capacity in steel and cement.
We have reached a tipping point, the significance of which was lost in many commentaries. In 2015, Chinese investment overseas outstripped foreign direct investment in China.
China’s outbound direct investment that year increased 18 per cent to $145.7bn, compared to $135.6bn coming in as foreign investment. China has emerged as a net exporter of capital.  
Obor has money. In 2015 the Chinese central bank transferred $82bn to banks for Obor projects. A Silk Road Fund worth $40bn was given the green light by China’s sovereign wealth fund and the government set up the Asia Infrastructure Investment Bank with $100bn of initial capital. While not formally part of Obor, the bank approved loans at its first general meeting for roads in Pakistan, Tajikistan and Uzbekistan.
Obor is far from complete but it is functioning, goods are being transported to Europe by land and sea. Overland trade from China to Europe mostly uses the northern route through Kazakhstan, Russia and Belarus. More than 1,250 trains made this journey in 2015, carrying 47,400 containers – a 40-fold increase from 2011. But is still at an experimental stage. 
The plan involves about 60 countries, though an exact number is hard to pin down. But this vagueness does not diminish its importance. Beijing has three major stated goals: the opening up of China’s west, establishing a moderately well-off society by 2020 and a prosperous one by 2050. This is dependent on the success of Obor.
 Beijing predicts that the new Silk Road will allow China to extend and showcase its soft power both culturally and economically. We are in a "period of strategic opportunity" up to 2020, according to the Beijing leadership, notwithstanding the remarks from American president-elect Donald Trump or territorial disputes in the South China Sea.
The global security environment, they believe, provides opportunities for China to extend its global power without risk of war. It also harks back to, and provides a timely reminder of, China’s more glorious past. Mr Xi’s presidency could well be determined by how successful it is.

The writer specialises on global affairs

 

inally, Obor can shift the axis of world trade. Pacific and Atlantic trade is dominated by the United States. Obor considers Asia and Europe as one market, and suits Beijing’s preference for cutting out the middleman.
Much can still go wrong. Russia may not always favour such a powerful Chinese presence in its own backyard. A credit crackdown in China could diminish funding for overseas investment. The security situation may not be so benign.
But it is worth noting, just before the Trump presidency begins, that China’s leadership horizons extend beyond fantasies of building a wall.    

At this year’s World Economic Forum in Davos,  Xi delivered a paean to global economic engagement, suggested that China should "guide economic globalisation" and that it would welcome everyone aboard "the express train of Chinese development". For the US, a China solution could take the form of financial investments that would create jobs. It would be a politically astute offer that  Trump could tout domestically as a triumph of his negotiating skills. In January, Ding Xuedong, the chairman of the sovereign wealth fund that manages part of China’s foreign exchange reserves, hinted as much when he put a price on  Trump’s infrastructure plan. It would need at least $8 trillion (Dh29tn), he said, and probably the help of overseas investors.
Second, a "China solution" would seek to maintain the status quo on current climate change policies agreed in Paris. They have been officially signed by more than a hundred countries, including China, and just days before  Trump took office  Xi gave a speech to the United Nations positioning China as a dedicated climate change leader. He pointedly said there is "only one Earth in the universe and we mankind have only one homeland". It would be too much to expect that a "China solution" would push  Trump back into his predecessor Barack Obama’s position on global warming. But by sticking with the Paris deal, the Chinese send a strong signal to other countries and earn the virtuous blowback that comes with being responsible global citizens. The irony is that now the US is opting out of parts of the very international system it had long nudged China to embrace as a "responsible stakeholder".
If  Xi were so minded, a "China solution" could also provide essential help for the United Nations, from which  Trump seems determined to cut as much US funding as possible. So far, the Chinese haven’t indicated they’re prepared to step into the breach but it’s not inconceivable considering they are the third-largest donors to the UN’s budget after the US and Japan and the second-largest contributor, after America, to UN peacekeeping.
Finally, there is the vision thing: the "China solution" for a time in which illiberal democracy is on the rise. China offers a stable, economically robust model for an alt-political system – one that makes no pretence even of seeking its people’s approval or mandate but claims to represent and champion their interests just the same.
Some years before he became president,  Xi publicly called out "bored foreigners, with full stomachs, who have nothing better to do than point fingers at us". China, he said, doesn’t export revolution or hunger and poverty. Why should it be considered a threat?
After the summit with  Trump, the question might finally be answered. China is not the best but the least worst solution available right now.

Will the China solution answer the worlds woes?

America once sold dreams, now China wants to sell solutions. Might this be the very template for a world, disrupted east and west by change, and seeking a quick fix?

Trump continues to glower at the Chinese, via Twitter, for the trade imbalance and North Koreas increasing bellicosity. The uncertainty is compounded by a sense that the United States and China are awkwardly trying to ease into each others space Trumps America away from the international order it has led from 1945; and China signalling that it will shoulder more of that burden. Unlike past summits, the mood music, too, is different. This time it is the Americans who are singing the blues about the international rules that govern trade and even about carbon dioxide emissions; China is resolutely backing them. Led by Trump, an inexperienced politician with a tendency to angry outbursts, the US appears less steady and reliable for anxious allies than Xis China. Is it time then to take seriously the so-called China solution, a phrase Xi first used last year to assure the world that China has a fix for everything? The Chinese people, he said, are fully confident that they can provide a China solution to humanitys search for better social institutions. It was a vague prospectus and certainly much less well-defined than Americas decades-old message to the world that it will act in the defence of freedom, liberty, free trade, democracy and human rights. He said it in July when the US presidential election still seemed to be Hillary Clintons to lose. No one but the Chinese took it seriously at the time but now, with Trump in the White House, things have changed. America once sold dreams, now China wants to sell solutions. Might this be the very template for a world, disrupted east and west by change, and seeking a quick fix? What might a China solution mean anyway? First, the status quo on globalisation, with China possibly investing more, if strategically, overseas, especially in the US. This would accelerate a process well in train for the past five years with China as among the top three export markets for 33 US states as the result of piecemeal deals. Obor is not the name of an ancient king or kingdom, but it does resonate with an ambition imperial in its scope. Obor One Belt, One Road is Chinas new Silk Road and is spinning a web of connectivity by sea and land across Central Asia and into Europe. Its ports, pipelines, railways, roads and airports are a priority for Beijing. Launched by president Xi Jinping in 2013, its a vision that in its potential exceeds that of the Marshall Plan. Chinese officials are, however, quick to downplay such comparisons, for two reasons. The plan that helped Europe emerge from the ravages of the Second World War, they say, was Washingtons way of rewarding friends. Obor is non-political, they claim. Secondly, it involves much more money. The Marshall Plan in todays value amounted to less than $100 billion (Dh367bn). Some estimates put the value of Obor projects now being built at just less than $1 trillion. Obor is already extending Chinese commercial influence and reducing the Chinese economys dependence on investment in infrastructure at home, and allows it to export some of its vast excess capacity in steel and cement. We have reached a tipping point, the significance of which was lost in many commentaries. In 2015, Chinese investment overseas outstripped foreign direct investment in China. Chinas outbound direct investment that year increased 18 per cent to $145.7bn, compared to $135.6bn coming in as foreign investment. China has emerged as a net exporter of capital. Obor has money. In 2015 the Chinese central bank transferred $82bn to banks for Obor projects. A Silk Road Fund worth $40bn was given the green light by Chinas sovereign wealth fund and the government set up the Asia Infrastructure Investment Bank with $100bn of initial capital. While not formally part of Obor, the bank approved loans at its first general meeting for roads in Pakistan, Tajikistan and Uzbekistan. Obor is far from complete but it is functioning, goods are being transported to Europe by land and sea. Overland trade from China to Europe mostly uses the northern route through Kazakhstan, Russia and Belarus. More than 1,250 trains made this journey in 2015, carrying 47,400 containers a 40-fold increase from 2011. But is still at an experimental stage. The plan involves about 60 countries, though an exact number is hard to pin down. But this vagueness does not diminish its importance. Beijing has three major stated goals: the opening up of Chinas west, establishing a moderately well-off society by 2020 and a prosperous one by 2050. This is dependent on the success of Obor. Beijing predicts that the new Silk Road will allow China to extend and showcase its soft power both culturally and economically. We are in a period of strategic opportunity up to 2020, according to the Beijing leadership, notwithstanding the remarks from American president-elect Donald Trump or territorial disputes in the South China Sea. The global security environment, they believe, provides opportunities for China to extend its global power without risk of war. It also harks back to, and provides a timely reminder of, Chinas more glorious past. Mr Xis presidency could well be determined by how successful it is. The writer specialises on global affairs inally, Obor can shift the axis of world trade. Pacific and Atlantic trade is dominated by the United States. Obor considers Asia and Europe as one market, and suits Beijings preference for cutting out the middleman. Much can still go wrong. Russia may not always favour such a powerful Chinese presence in its own backyard. A credit crackdown in China could diminish funding for overseas investment. The security situation may not be so benign. But it is worth noting, just before the Trump presidency begins, that Chinas leadership horizons extend beyond fantasies of building a wall. At this years World Economic Forum in Davos, Xi delivered a paean to global economic engagement, suggested that China should guide economic globalisation and that it would welcome everyone aboard the express train of Chinese development. For the US, a China solution could take the form of financial investments that would create jobs. It would be a politically astute offer that Trump could tout domestically as a triumph of his negotiating skills. In January, Ding Xuedong, the chairman of the sovereign wealth fund that manages part of Chinas foreign exchange reserves, hinted as much when he put a price on Trumps infrastructure plan. It would need at least $8 trillion (Dh29tn), he said, and probably the help of overseas investors. Second, a China solution would seek to maintain the status quo on current climate change policies agreed in Paris. They have been officially signed by more than a hundred countries, including China, and just days before Trump took office Xi gave a speech to the United Nations positioning China as a dedicated climate change leader. He pointedly said there is only one Earth in the universe and we mankind have only one homeland. It would be too much to expect that a China solution would push Trump back into his predecessor Barack Obamas position on global warming. But by sticking with the Paris deal, the Chinese send a strong signal to other countries and earn the virtuous blowback that comes with being responsible global citizens. The irony is that now the US is opting out of parts of the very international system it had long nudged China to embrace as a responsible stakeholder. If Xi were so minded, a China solution could also provide essential help for the United Nations, from which Trump seems determined to cut as much US funding as possible. So far, the Chinese havent indicated theyre prepared to step into the breach but its not inconceivable considering they are the third-largest donors to the UNs budget after the US and Japan and the second-largest contributor, after America, to UN peacekeeping. Finally, there is the vision thing: the China solution for a time in which illiberal democracy is on the rise. China offers a stable, economically robust model for an alt-political system one that makes no pretence even of seeking its peoples approval or mandate but claims to represent and champion their interests just the same. Some years before he became president, Xi publicly called out bored foreigners, with full stomachs, who have nothing better to do than point fingers at us. China, he said, doesnt export revolution or hunger and poverty. Why should it be considered a threat? After the summit with Trump, the question might finally be answered. China is not the best but the least worst solution available right now.