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"On my part, I remain committed to the process of dialogue. It is my firm belief that dialogue and a willingness to look with honesty and clarity at the reality of Tibet can lead us to a viable solution."

Walker's World: Ganging up on China

January 26, 2010

By MARTIN WALKER, UPI Editor Emeritus
January 25, 2010

WASHINGTON, Jan. 25 (UPI) -- The row over
Internet censorship between Google and China got
all the headlines, but the really alarming
development for Beijing in the last week came from India.

The unprecedented decision by the Indian
government to deliver a formal diplomatic
demarche against Chinese trade policies was just
one of a range of developments in recent days
that must be troubling the Chinese leadership. It
seems as if a critical mass of criticism is
coming together among some of China's leading trade partners.

To Beijing's prickly and defensive leaders, who
have proved quick to take offense, it may seem
that a wave of China-bashing is under way. There
was more than a hint of that in quasi-official
Chinese media charges that the Google affair was
somehow being whipped up by the U.S. government.

But the fact is that each of the countries that
have publicly bridled at the Chinese way of doing
business was acting independently, even though
they have many similar concerns, particularly
over cyberattacks and espionage from China.

Two weeks ago the chairman of Indian's Cyber Law
and IT Act Committee told reporters: "China is
very active in cyberspace. It has raised a cyber
army of about 300,000 people and their only job
is to intrude upon secured networks of other
countries. All this is all aimed at supremacy.
Every country must set up cyber armies to counter China."

But India's latest diplomatic demarche is
something new. The note was delivered by the
Indian Commerce Ministry at the end of last
week's meeting of the Sino-Indian Joint Economic
Group of in Beijing. It was inspired by India's
soaring trade deficit with China, which has risen
from $1 billion eight years ago to $22 billion
last year. India blames Chinese foot-dragging on
promises to open its markets to food and other Indian exports.

Then there was the announcement by the Indonesian
government that it wants to renegotiate the new
free-trade pact between China and the Association
of Southeast Asian Nations. This followed mass
demonstrations in Java by workers concerned for their jobs.

"If there aren't any protective steps taken for
these industries we're afraid that there will be
layoffs and even the closure of those
industries," Industry Minister M.S. Hidayat told
Parliament. He cited Indonesia's steel, textile,
non-organic chemical, furniture and energy-saving
lamp industries as the ones facing the "most
serious impact" and called for the pact to be
renegotiated to shield such sectors from Chinese competition.

Industries in Thailand and Malaysia have also
called for a halt in the free-trade deal between
ASEAN and China. It was hailed when it came into
effect Jan. 1 as the world's third-largest trade
deal, bringing together markets with a combined
population of 1.9 billion people with a gross
domestic product of $6.6 trillion and a trade volume of $4.3 trillion.

Tan Sri William Cheng, president of the
Associated Chinese Chambers of Commerce and
Industry of Malaysia and one of the most
prominent business leaders in the country, called
for a delay in the full liberalization of trade
with China, saying his country's industries are
not ready to face the impact of full competition.
But other Malaysian objectors have said, echoing
the Indian concerns, that they fear China will
not play the game by the same rules.

China's response to criticism is to
counterattack. Take, for example, the warning
last week by Japan's foreign minister that Tokyo
would be forced "to take action" if China does
not uphold the agreement for joint exploitation
of oil and gas fields in disputed island waters
that are claimed by both Tokyo and Beijing. The
Chinese response was this was caused by "domestic
political uncertainty in Japan. … The current
Japanese government, led by Yukio Hatoyama, wants
to divert the public attention to the diplomatic
dispute with China from a funding scandal."

This hardening of opinion toward China is not
restricted to its Asian neighbors. Charles Grant,
director of the Center for European Reform, an
influential London-based think-tank, has just
published a report titled "China's 'peaceful rise' turns prickly."

"European leaders are increasingly critical of
China, at least in private," Grant notes,
suggesting Europe's re-think followed the
crackdowns in Tibet and China's unhelpful
negotiating position at the Copenhagen summit on
climate change. "China's leaders should not
assume that European markets will remain open to them indefinitely."

China's exports to the West, still far below
their boom levels of 2007, are vulnerable to any
more scandals over health and safety. And one
came last week, when companies selling
Chinese-made baby strollers recalled 1.5 million
of them sold in the United States and Canada over
the past four years, warning that badly designed
and sharp hinges could slice off infants' fingers.

Few people want a trade war, which would damage
the whole global economy. But growing concern in
the U.S. Congress and European Parliament over
China's "currency manipulation" suggests the
issue is coming to a head this year. But what
Beijing may not have expected was that the charge
would be led by India, with other Asian neighbors close behind.

If so, then Beijing was not paying attention.
Only last year India's Defense Ministry warned
the country's telecoms industries "not to award
equipment contracts to Huawei and Zhong Xing
Telecommunication Equipment Company Limited in
the interest of national security."
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