And so Beijing's top leaders face a vicious Catch-22. Pushing too hard
with nationalist, xenophobic sentiment in order to boost domestic unity
could stem the flow of FDI required to push ahead with development
projects key to Chinese domestic unity. But refusing to play the
nationalism card in favor of warmer economic ties with Japan could
remove the last remaining symbolic tie between the Chinese public and
their government, risking a fracture that could cripple economic plans
as well as the political future of the world's most populous
nation-state.
SO THEY WILL JUST REPLACE JAPAN WITH THE GOOD OL' USA, YOU FUCKING
YEAST INFECTION ***** FARTS. ***** YOU.
***** THE WH*RE OF B*BYL*N. READ REVELTAION 18 NOW YOU FUCKING
ASSHOLES!!!
China: Beijing's Hard Choice Between Cohesion and FDI
August 11, 2005 19 26 GMT
Summary
Beijing ordered a crackdown Aug. 10 on anti-Japanese demonstrations
coinciding with historical anniversaries, and the Japan External Trade
Organization warned Japanese businesses the same day to stop being
"overdependent" on investment in China. Beijing depends on stirring up
nationalism to help quiet its increasingly restive population, but it
also depends on foreign, especially Japanese, investment to provide an
economically secure climate for millions of potentially seditious
citizens. China's ability to carefully control expressions of
nationalism is vital to its political future, but the effectiveness of
Beijing's control may be showing signs of strain, and destructive
economic consequences are beginning to mount.
Analysis
China ordered its public security bureaus Aug. 10 to be vigilant in
cracking down on any anti-Japanese protests on V-J Day on Aug. 15, the
official Chinese World War II victory day Sept. 3, and the Sept. 18
commemoration of the Japanese bombing of Shenyang in 1931, the Hong
Kong daily Ming Pao reported.
While it is not certain at this time just how fine a control Beijing
has over each and every nationalist protest, the decision to actively
discourage upcoming demonstrations reveals that China faces an
increasingly difficult choice between domestic social cohesion and
vital relationships with its economic partners.
In April, large-scale protests in China erupted over proposed changes
to Japanese textbooks, which some said whitewashed Japanese
transgressions during World War II. The protesters damaged the Japanese
Embassy as well as several Japanese businesses. Beijing caused a
diplomatic imbroglio when it refused to apologize for the wide-spread
movements. The government labeled the demonstrations "spontaneous
eruptions of just outrage," thus not only denying official culpability
but providing a moral basis for anti-Japanese activity.
Beijing did not want to apologize for the protests because they
provided it with a way to foster national solidarity. Given the central
government's tight controls on information, Beijing was likely directly
responsible for instigating the April protests in order to pressure
Japan and -- more important -- to generate a unifying nationalistic
fervor absent in China since the de facto death of Communism and the
instigation of free-market reforms. With China's systemic economic and
political problems weighing heavily on its plans for the future, an
appeal to a strong sense of nationalism might be the only way for the
central government to maintain power. South Korea depended on national
solidarity during the 1997 Asian financial crisis to undertake drastic
reforms of its oligarchic corporate structure in order to avoid
collapse. China has lacked such solidarity, and anti-Japanese protests
represented the only way to ignite that kind of passion of late.
China knows it is playing with fire, however. Should the protests
against Tokyo get too large or too intense, severe economic
consequences could follow for Beijing -- Japanese businesses concerned
over possible damage to their industrial investments could start
looking for other markets in which to place some of their $5.5 billion
annual direct investment into China. China could not afford this loss,
as it desperately needs increased foreign direct investment (FDI) --
especially in its coastal regions due to a huge demographic shift of
peasants from the countryside into to the megacities along China's
seaboard. Beijing rightly fears the unrest that could occur if these
poor, out of work ex-farmers do not have enough jobs waiting for them
in cities -- which are already fighting the central government to keep
the ex-farmers out.
According to a survey by the Japanese External Trade Organization
(JETRO), Japanese businesses by and large did not decide to pack up and
move out after the April protests. However, there was a huge downward
shift in the number of businesses planning on expanding their
operations in China between January and May. Thus, while in January 87
percent of companies planned on increasing their investments in China,
the number in May dropped to 55 percent. A one-third drop in planned
FDI from Japan would not bode well for Beijing.
On the same day Beijing was dealing with the issue of upcoming
protests, JETRO released its annual white paper on international trade
and FDI. More explicitly than previous versions, the 2005 paper warns
Japanese companies against the risk of heavy investment in China
leading to "overdependence." Instead, JETRO is urging businesses to
investigate creating capital flows to India, Brazil, and the
Association of South East Asian Nations. In the past, JETRO had simply
advised capitalists to look beyond China while they continued a large
influx of FDI to China, a strategy called "China plus one."
And so Beijing's top leaders face a vicious Catch-22. Pushing too hard
with nationalist, xenophobic sentiment in order to boost domestic unity
could stem the flow of FDI required to push ahead with development
projects key to Chinese domestic unity. But refusing to play the
nationalism card in favor of warmer economic ties with Japan could
remove the last remaining symbolic tie between the Chinese public and
their government, risking a fracture that could cripple economic plans
as well as the political future of the world's most populous
nation-state.
Beijing does have one thing to be thankful for, though: At the moment,
it seems capable of effectively controlling protests -- when the April
demonstrations got out of hand, it did manage to rein in the crowds.
But despite being quickly corralled, the intensity of the spring
protests, which brought threats of physical violence against Japanese
businessmen and their interests, did a surprisingly large amount of
damage to Japan's willingness to keep pouring capital into Chinese
development. The government faces a long-term problem if its diminished
support for nationalistic rallies gives rise to a diminished
willingness among the protesters to stop when Beijing tells them to. If
such rallies intensify, an already impossible choice between domestic
cohesion and foreign investment could cease to be a choice at all, and
China's future development could be in jeopardy.
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