Already today China is building up its foreign economic relations on the principle of "the nucleus vs. the periphery", copying the policies of the "golden billion". As for its foreign policy, it presents itself as an alternative to the US "new world order ". Considering its status of a member of the UN Security Council and a nuclear power, it makes it possible to speak of China having really become an alternative to the US.
If previously Russia was first of all a supplier of military hardware and raw materials for Chinese economy, it is also becoming, alongside of North Korea and Indonesia, a supplier of semi-finished goods for various branches of Chinese industry, in fact its appendix as a source of raw materials for its industry.
Examples are near at hand. The Chinese are willing to invest in wood processing industry, but on the condition of importing only semi-finished products. Finished products have to be manufactured on Chinese territory. On these conditions, they are willing to invest in the construction of the Amazarsk pulp mill and the reconstruction of the Amur pulp-and-cardboard plant. We get the waste, and they get the profits. Moreover, we get not only our waste, but also theirs. The share of the Chinese side in the Amur flow volume is about 30 percent, and in its pollution 70-90 percent. The pattern of relations is like that between the "golden billion" and the periphery. The "golden billion" get the resources of the periphery, while exporting its problems related to the economic activities. That's the way the nucleus functions. The same principle applies to North Korea: the basis of its exports to China is metal scrap, products of ferrous and non-ferrous metallurgy and semi-finished products for China's chemical industry. In the meantime, China will have curtailed its production in low-technology branches of ferrous metallurgy, while preserving its high-tech branches, like the West and Japan did in the 1970-90s by moving production to developing countries. The Chinese just took advantage of the hard situation lived by Russia and N. Korea at the beginning of the 1990s.
Simultaneously China intensifies its efforts to advance in South-Eastern Asia. Apart from the traditionally high proportion of "huatsiao" (expatriate Chinese) in the economies of the countries of the region, Chinese mainland corporations began to actively buy up assets and shift assembly lines to those countries (for example, to Indonesia). The process was greatly favored by the financial crisis of 1997-1998, whereas there was no counterweight to the Chinese financial power at that time. To complete the picture, one should remember the restitution of Macao and Hong Kong to the Chinese bosom. Thus economies of a large part of East-Asian countries now come to be centered on a single Chinese market.
Practically free of charge, the Chinese took advantage of the US victory in the "cold war" at the beginning of the 1990s and the US financial blow on Asian economies in 1997-98. And that's just the beginning. For instance, Chinese car assembly plants have already appeared outside the confines of the PRC. Now even the countries of the "golden billion" have to ward off the offensive of the "yellow billion" in trade wars. The defense does not seem to be very effective, judging by such facts as President Bush having recently asked China to raise the yuan exchange rate or Europe having raised customs duties on Chinese consumer goods.
China is the world's second biggest energy consumer, but it still has one unsolved problem, that is the deficit of energy carriers. Peking is quite aware that the ways and means of solving that problem have been moving from the field of pure market economy to the field of politics and even outright use of force. The first important source of energy is Russia. For example, the Bureya Hydro-Power Station has been designed with, first and foremost, Chinese consumers in mind. In future the RAO UES (Russian power supply giant monopoly) would be ready to supply up to 100 billion kwh annually to the other side of the Amur River. Agreements have been signed for the construction of oil and gas pipelines from Eastern Siberia to China.
However, that will not be enough. There are also hydrocarbon deposits in the Central Asia, and Chinese companies are rushing there. Thanks to its activity within the framework of the Shanghai Cooperation Organization (SCO), China is beginning to force US military bases out of the region. Thus Peking is killing two birds with one stone: the US will cease to threaten it from the Western direction, and secure oil supply from the Central Asia and Siberia is assured.
But the main world "fuel can" is still the Persian Gulf, and there China has its ally and supplier - Iran. This explains the broad economic and military-technical cooperation between the two countries. It is thanks to the PRC that Iran has made a spurt in the military-industrial sphere – "Chinese roots" can be traced everywhere - from sub-machine guns to modern guided missiles. It is only a powerful Iran that can assure uninterrupted oil and oil-products flow. Besides, in case of emergency a powerful Iran would be in a position to disrupt oil supply from the Middle East to the US and its allies by blocking the Strait of Hormuz and striking blows at the Arabian Peninsula oil fields. This circumstance seems to play a role in the high-priority creation and production of missile weapons in Iran. The setting up of the Tehran petroleum stock exchange, the shedding of the dollar as a means of payment, and other measures of a financial nature are to be viewed in the same light.
In fact, this is the key issue in the Middle East now, and not some semi-mythical "Islamic bomb". True, things are not so simple on that issue either – for example, Pakistan became a nuclear power largely thanks to the Chinese aid, as it received engineering documentation as early as in 1982, and it is from there that the technologies began to spread all over the world. It is also from there, as well as from N. Korea, that Iran received ballistic missiles. China also greatly assisted Iran in setting up production of chemical weapons. Many other instances of China breaching the non-proliferation regimen can be cited.
It also explains the brisk build-up of the military infrastructure, as well as the rate and scale of combat training of the growing Chinese navy in the area of the Spratly Islands in the South China Sea – it is through that region that up to 80 percent of oil and oil-products transported by tankers are supplied to North-Eastern Asia.
The same kind of policy can be traced in the development of relations with Venezuela (re Hugo Chavez's threats to stop oil supply to the US and re-route it to China), Sudan (promising deposits have been found there and are being developed by Chinese companies) and many other states. Peking is also resorting to propaganda moves to pique the US. Thus in 2000 it gave financial assistance to Belgrade to reconstruct its infrastructure destroyed during the NATO aggression in 1999.
It is too early yet to say that the 21st century will be a "Century of China", because there are too many "snags" for that, but China has already become a real alternative to Pax Americana. We are witnessing the process of a number of countries crossing over from Washington to Peking. The PRC has only to declare its new status, like the USSR did at the time of the "Caribbean crisis". The Taiwan problem would serve the purpose, as well as the dispute over the Spratly Islands and the Korean Peninsula. But will China have the sufficient strength? For a demonstration of strength – yes, for a military victory over the US - no. However, the unprecedented military preparations in China are going on, and its military-industrial complex has practically bridged the gap in the field of advanced military technologies between China, on the one hand, and Russia and the West, on the other, during the last 15 years. "China has been rapidly developing its defense industry, and our experts believe that in the nearest five years the Chinese will be able to create such modern weapons as we are making today, and they will surely manufacture it if they cannot buy it", said French Minister of Defense Michelle Alliot-Marie in 2005. Many Western military experts share that opinion. Incidentally, there is every reason to believe that in that case the market for the sale of Russian military hardware will shrink a lot.
Lately China has been increasingly firm towards its neighbors, as evinced by the incident with the US spy plane grounded on the island of Hainan, the appearance of a Chinese submarine in Japan's territorial waters, the movement of 150,000 troops close to the N. Korean border, and the escalation of military maneuvers in the Taiwan Strait. Russia should do well also to ponder these developments. The influence exerted by the Chinese on many aspects of life in our Far East has been rapidly growing. Pipelines and markets – it's all well and good, but by making concessions in the expectation of reciprocity Russia has already lost a number of areas along the border. And then, is it for nothing that China has been building up fire power and mobility of its ground forces, and updating its huge tank fleet?..
