Monday, September 18, 2006

China's Coming Entanglement

One more post before I leave town this week.

In "China Competes with West in Aid to Its Neighbors," Jane Perlez describes the mind-boggling breadth and generosity of the PRC's development loans to its neighbors:

STUNG TRENG, Cambodia — In the dense humidity of northern Cambodia, where canoes are the common mode of transportation, a foreman from a Chinese construction company directs local laborers to haul stones to the ramp of a nearly completed bridge.

Nearby, engineers from the China Shanghai Construction Group have sunk more than a dozen concrete pylons across a tributary of the mighty Mekong River, a technical feat that will help knit together a 1,200-mile route from the southern Chinese city of Kunming through Laos to the Cambodian port of Sihanoukville on the Gulf of Thailand.

This is the new face of China’s foreign aid to poor Asian countries: difficult construction in remote places that benefits the recipient, and China, too.

“It is the favor of our government to the Cambodian people,” said Ge Zhen, 26, one of the more than 50 engineers and 250 other Chinese workers on the four-year project.

Flush with nearly a trillion dollars in hard currency reserves and eager for stable friends in Southeast Asia, China is making big loans for big projects to countries that used to be the sole preserve of the World Bank, the Asian Development Bank, the United States and Japan.

China is doing good while doing well, of course, and most recipients can barely contain their enthusiasm for loans that are unencumbered by the West's environmental restrictions and steep consultants' fees. But there's speculation that China will build a deep-water port at Sihanoukville as a terminal for its Middle Eastern oil imports.

This isn't a bad thing in and of itself; but if China pays to build a port that's designed to receive a strategic mineral like oil, it's likely to think of that bit of Cambodia as China's port, with consequences for Cambodia's sovereignty that are much like those for Central American countries that hosted United Fruit operations during the 20th century.

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