September 30, 2016: Despite recently easing up on sanctions China promptly condemned the September 9th North Korean nuclear test. China closed the border crossings with North Korea for three days but then traffic resumed. China is North Korea’s largest trading partner, buying over half of legal North Korean exports. In turn North Korea imports over $3 billion worth of food, medicine and other unsanctioned items from China.

Until the latest North Korean nuclear test China was directing more anger at South Korean refusals to halt the expansion of their anti-missile defenses. To coerce South Korea China loosened the UN sanctions on North Korea it began enforcing in March as part of an international effort to get North Korea to halt its nuclear weapons and ballistic missile program. That may have encouraged North Korea to detonate the nuke today but China is embarrassed because they told the world that they had North Korea under control. Even before the recent test China quietly cancelled some investments that were going to be made in North Korea. China always wanted North Korea to halt its nuclear weapons program but it is also opposed to neighbors like South Korea and Japan installing anti-missiles systems. China can’t seem to get any Koreans to do as they are told. Then again, that describes the relationship between China and Korea for over a thousand years.

China is concerned about the erratic behavior of North Korea but officially insists that there is little it can do except criticize North Korea and urge the North Koreans to back off on their nuclear weapons development. In reality, there is much China could do to get the attention of the North Koreans, but that would involve the possibility of making North Korean leaders more erratic and aggressive. Cutting economic (oil and natural gas) and food aid as well as halting unofficial aid to illegal North Korea exports (drugs, counterfeit currency, weapons) would hurt more than the current sanctions and might cause a collapse of the North Korean government. That is something China wants to avoid, because it would force China to confront South Korea and the West over Chinese plans to occupy North Korea in such a situation. China would call this peacekeeping but the rest of the world would call it an annexation. This could get very nasty. Another option is to back pro-Chinese North Korean officials in a coup to install a more obedient (to China) government. This is risky, as the North Korean leaders have been aware of this threat for over a decade and have regularly purged the ruling bureaucracy of anyone believed to be pro-China. A failed coup would be, well, messy. According to China quick solutions and very critical of anyone making military threats against North Korea.

Above all China wants to avoid chaos in North Korea because that would be bad for the Chinese economy and increase the threat of conflict with even more dangerous opponents like Japan, South Korea and the United States. The most extreme (but acceptable) measures China could take include literally taking control of North Korea (which China has done in the distant past). Staging a coup in North Korea has always been a possibility but the paranoid (for good reason in this case) North Korean leadership has made it difficult for China to recruit enough North Korean officials to make this feasible. That said, the potential is still there and China could still go this route. Many North Koreans believe that the Chinese will just move in and take over if it appears that the North Korean government is about to fall apart or otherwise becoming too dangerous to China. The Chinese takeover plan apparently includes installing pro-Chinese North Koreans as head of a new "North Korean" government, and instituting the kind of economic reforms they have been urging the North Korean to undertake for over a decade. The Chinese do not want North Korea to merge with South Korea, nor do they want North Korea to collapse economically and politically because that would send millions of desperate and starving refugees into northern China. All the neighbors (especially China and South Korea) want North Korea to stay independent, and harmless. Thus China is willing to unofficially annex North Korea, knowing that the South Koreans would go along with this as long as the fiction of North Korean independence was maintained. South Korea won't admit this, but most South Koreans know that absorbing North Korea would put a big dent in South Korean living standards. That is more unpopular than any other outcome. While all Koreans would like a united Korea, far fewer are willing to pay the price.

The Wukan Rebellion

Despite a government media blackout one of the biggest news stories in China is that public protests and political unrest in the southern coastal town of Wukan continue. Apparently Hu Chunhua, the senior provincial CCP (Chinese Communist Party) official was told that if he does not shut down the Wukan protests this year his chances of getting into the seven member Politburo Standing Committee (that selects the leader of China) will disappear. Since 2012, when Hu Chunhua got promoted to his current job, he has been spoken of as a future leader of all China. But the inability of the provincial government to suppress the Wukan unrest is seen as a major failure.

The Wukan protests against corrupt local officials and the unwillingness of provincial or national governments to do anything about it resumed in mid-June. The protests went on for nearly a week before the government decided to restrict access to Wukan and banned any further mention in Chinese media (including the Internet). Many Chinese have been following events in Wukan with great interest since it all began 2011. Wukan became national news in 2012 when an anti-corruption effort turned into what amounted to an uprising. It ended with one of the rebel leaders being made the local CCP boss. That did not lead to the expected crackdown on corruption. The CCP, like similar organizations, looks after its own first.

The persistent unrest in Wukan (and elsewhere in China) goes back to the fact that the Communist Party is still the ultimate power in China, which is still a communist dictatorship. But since the 1980s the government has allowed, and encourages, business owners and entrepreneurs to join the party. While the party still has some true-believers in radical socialism, the leadership is dominated by advocates of a market economy. When implemented in the 1980s local party leaders quickly used their power to get rich themselves, often with corrupt practices. Many local and provincial party leaders, like those in Wukan, screwed too many of the locals too often. That led to lots of demonstrations and, in 2011, open rebellion. The national government eventually ordered provincial officials to side with the rebels against the corrupt local officials. This was a bold move, but is also in line with the policy of bringing the most effective people into the party. For most of December 2011 the town of 20,000 was in open rebellion because of corrupt local officials who also killed a popular protest leader. The national government apparently ordered provincial officials to be the good guys and quiet things down as quickly as possible, with the least amount of mess (dead bodies and general destruction.) While police surrounded the town and banned foreigners, especially journalists, from the area, news got out anyway. Internet access was cut off, but there were still cell phones and people sneaking in and out. The government does not want stuff like this to spread, because there have been hundreds of outbreaks similar (but not as extensive) to Wukan during 2011 and 20012. Enough Wukans happening at the same time and in the same area could spark a wider rebellion. It's happened many times before in China's history, and Chinese officials, especially at the national level, paid close attention to history. So the Wukan situation (and several others in the south) were exploited by the national leadership as an opportunity to punish some local officials and serve them up as examples to the many more local officials who do the same thing, but more discretely. The national officials would like to get rid of corruption, but more discreet corruption is an acceptable alternative. The new Communist Party leader of Wukan was unable to bring corrupt local officials, especially at the provincial level, to justice. In June 2016 the rebel leader turned local Communist Party leader was arrested for continuing support of local demands that the government act on corruption and right past wrongs (like stealing of land). The locals realized the government claims that it was doing something about corruption were only true some of the time and that in many provinces the local officials were powerful (or clever) enough to escape punishment and continue as before. Limiting the spread news about Wukan is what government control of the mass media is all about.

Venezuela

In places like Africa and South America China has found new markets for its products and has adapted to sometimes volatile local situations. A current example is Venezuela, a South American nation that tried socialism for 17 years and, as often happens, trashed the economy. Still in power, the Venezuelan socialists have, since 2015 tried one unworkable government “economic recovery” plan after another but none have worked. The government is rapidly running out of cash and has lost most popular support for any of their radical solutions. Attempts to get more loans out of China, a major customer for Venezuelan oil and major lender, are now turned away without explanation. The Chinese see where this is going and want to cut their losses. China has been a major diplomatic and economic supporter but because China is now obviously backing away no one else is willing to lend. Venezuela already has lots of foreign debt and some of it looks like it won’t get paid back even after a new non-socialist government takes power. In 2015 China agreed to provide another $5 billion but only for maintenance and upgrades on Venezuelan oil production facilities. This was so China has a better chance of getting paid back the other $40 billion it has loaned Venezuela. But even that deal appears to be unravelling because of corruption and mismanagement in the state owned oil company. Since 2014 China has been quietly advising Chinese working in Venezuela to get out and over 30,000 Chinese have done so. New investments from China or Chinese firms, once so abundant, have disappeared since 2015. China has applied the same strategy elsewhere, especially in Africa.

Fish To Lie And Die For

China has earned a reputation for ignoring international law and other illegal activity by Chinese ships that are helping the Chinese economy. It has long been known that China encourages its coast guard to do whatever they can get away with to drive foreign fishermen from their traditional fishing grounds that are now claimed by China. In the South China Sea these claims are backed up by a growing number of artificial islands. China stations military personnel and weapons on these tiny island fortresses. In preparation for each island building operation China demands that all foreign vessels stay out of the area. The Chinese always stop short of actual combat in forcing (or intimidating) other nations out of disputed waters. Some outsiders think this is about potential underwater oil and gas fields. In the future perhaps. In the present it’s all about food, in this case fish.

Many Chinese fishing ships are part of an unofficial but organized and paid naval militia. The Chinese maintain this force with subsidies (for building new fishing boats) and assurances that the navy will assist Chinese fishermen in gaining access to foreign fishing areas and exclusive use of fishing grounds in international waters. The fishing boats are the most numerous and aggressive component of this militia. There appear to be over a hundred civilian ships (mostly ocean going fishing trawlers) associated with this militia program, which openly functions as a government supported organization and has headquarters in southern China. Any foreign criticism of the Chinese naval militia elicits only denials from the Chinese government.

While most nations bordering the South China Sea refuse to push back at these Chinese tactics, elsewhere it is often different. South Korea has been having increasing problems with aggressive Chinese poachers. Many of these Chinese fishermen are armed with knives, saws, and axes and willing to use force to repel South Korean coast guardsmen or maritime police seeking to arrest them. China protests the “rough treatment” of its fishermen but does little to curb the poaching or violence against South Korean coast guardsmen. South Korean regards this as another example of Chinese arrogance. While South Korea and China are big trading partners, they are also at war here. This is low level stuff off the South Korean coast where, the South Korean coast guard has seized thousands of Chinese fishing boats for poaching. Chinese fishermen consider the risk acceptable because the fish stocks off the South Korean coast are much richer (in quantity and quality) than off China (where overfishing has done a lot of damage). South Korea has become more forceful against the poachers but they keep coming and the Chinese government insists it cannot control them. North Koreans have a similar but more sinister problem. A Chinese firm apparently solved the North Korean problem by purchasing fishing rights off both North Korean coasts for $75 million.

The farther away from China the less intimidated the victims of these tactics are. Indonesia has seized and destroyed a growing number of Chinese fishing boats and ignored Chinese complaints and threats. Argentina did the same and China backed off. But off the coasts of South Korea and Japan, as well as throughout the South China Sea there is less willingness to fight back. Despite the ancient fear of war with such a powerful neighbor, more neighboring states are using force to repel the Chinese poachers.

September 29, 2016: A Chinese fishing trawler caught fire off the South Korean southwest coast after it was caught illegally fishing and when ordered to stop by a South Korean patrol boat. The trawler tried to run for international waters and apparently radioed for help from the Chinese military. The South Korean patrol boat launched a speedboat with a boarding party which caught up with the trawler. South Korea police climbed aboard and found the Chinese crew of 17 had locked themselves up in their work spaces. The police headed for the wheelhouse and tried to get in by first breaking a window and tossing in two flash grenades to incapacitate the Chinese inside. That worked but the flash grenades started a fire which quickly spread, producing lots of smoke. The patrol boat soon caught up and sent in sailors with firefighting gear to put out the fire. Three of the Chinese crew had locked themselves in the engine room and were found to have died from smoke inhalation. The Chinese crew were apparently under orders to stay locked in until help arrived. The other 14 Chinese sailors were jailed until the situation could be resolved (usually by China paying a large fine).

September 26, 2016: The U.S. revealed an indictment of four Chinese executives with DHD (Dandong Hongxiang Industrial Development Company) a major Chinese trading company. DHD and its managers are being prosecuted for illegally providing front companies and other cover so North Korea can evade banking sanctions. China had earlier announced it was investigating DHD for corruption and criminal activity and let it be known they preferred to handle the DHD situation themselves. The U.S. broke precedent in going after DHD executives and said it was investigating more Chinese firms for similar illegal activities. China protested this, not so much because it wants to ease the sanctions on North Korea but because China is trying to curb the corruption that is crippling the Chinese economy. China insists on strictly controlling publication of details of this corrupt activity, apparently because many of those involved are members of the Chinese Communist Party. China is especially hostile to American efforts to collect enough evidence to indict Chinese government officials. As potentially hazardous North Korean missiles and nukes are to China, damaging the reputation of the Chinese leadership is considered more of a threat.

On a brighter note today China and Cuba signed thirty economic agreements. China is, after Venezuela, Cuba’s largest trading partner. Currently that trade amounts to over $2 billion a year. Since the late 1990s China and Cuba have been increasing military and economic ties and since the 1960s Cuba has been considered an ally of China and that began to pay off in the late 1990s. By 2006 China had become Cuba's second largest trading partner. China has achieved this by extending credit to Cuba, despite a long record of unpaid trade loans. Later in 2006 a Chinese military delegation visited Cuba, offering to compete with Russia in the bargain-basement weapons market. Cuba was now getting a lot of money from Venezuela and could afford to upgrade its decrepit armed forces. By 2010 China and Cuba announced closer military cooperation, which meant more freebies for Cuba and more access to Cuba for intelligence gathering activities (in America's backyard) by the Chinese. In late 2011 the first Chinese Navy vessel (a Hospital Ship) to ever visit Cuba arrived for a working visit. In 2012 China and Cuba have agreed to increase military cooperation. While China had supported the Cuban dictatorship since the 1960s they never provided much in the way of economic or military aid. Now China pays Cuba for the use of electronic monitoring (of the U.S.) facilities. China maintains a low profile in Cuba, apparently in order to avoid a confrontation with the United States that would weaken Chinese complaints about American military forces operating near China. In late 2015 Chinese warships visited Cuba for the first time as a Chinese destroyer, frigate and supply ship arrived.

September 19, 2016: China announced improved cooperation with the United States to eliminate the North Korean nuclear weapons program. Left unsaid is that the U.S. and China have unresolved differences over how to go about this.

September 9, 2016: China promptly condemned today’s North Korean nuclear test in and threatened unspecified retaliation.

Meanwhile in Tibet Chinese troops again crossed the Indian border into Arunachal Pradesh. Unlike a similar incident three months ago where the Chinese stayed a few hours then left, this time a camp was set up 45 kilometers inside India and was there for several days before being discovered. When Indian troops showed up the Chinese refused to leave, claiming they were in Chinese territory. Neither of these incidents were supposed to happen because of border agreements China and India negotiated in 2013 and 2014. China said the June incursion was an accident and the troops left as soon as India contacted China (per the border agreements) and China was able to contact the border troops involved. But this time the Chinese refuse to move. Negotiations with India are still going on with another high-level meeting on October 1^st. There had been fewer of these incursions since 2014 but China still claims to own Arunachal Pradesh. China has always maintained that the 3,500 kilometer long border between India and Chinese Tibet (1,126 of with Arunachal Pradesh) was only temporary and since 2010 China has been more aggressive about it. In 2011 there were 213 of these Chinese border violations, followed by 426 in 2012 and 4113 in 2013. In 2014 China protested India building roads near the Chinese border in northeastern India. The roads were in an area that new (2014) Chinese maps showing Indian territory claimed by China as actually being part of China and within China’s borders. This is just another escalation in a long-running border dispute over who owns areas like Arunachal Pradesh. In this part of northeast India there are few, if any, ethnic Chinese. The locals know that a Chinese takeover would mean drastic changes because the first thing China does in places like this is move in a lot of ethnic (Han) Chinese and marginalize the natives. This rarely ends well for the locals. While these Chinese claims have been on the books for decades, since 2000 China has become more vocal about it. That's one reason India has been rapidly increasing its defense spending. But since both nations have nuclear weapons, a major war over these border disputes is unlikely. Constant Chinese pressure is another matter. China is applying the same tactic in all its recently activated territorial claims. Constant pressure while avoiding anything that might trigger a war is seen by China as a slow but certain way to secure its claims.

September 7, 2016: Since late August China has had an unusual number (at least ten) of coast guard and navy ships off Scarborough Shoal. While claimed by China this shoal is 220 kilometers from one of the main Filipino islands (Palawan) and 650 kilometers from Chinese territory (Hainan Island) and according to international law it is Filipino. China is trying to persuade (with offers of cash, trade and whatever) the Philippines to cooperate and that may be working.

September 6, 2016: Japan confirmed its offer (earlier in the year) to lease the Philippines five TC-90 aircraft. These are military versions of the popular King Air twin engine civilian transport. The TC-90 doubles the range of Filipino coastal surveillance from 300 to 600 kilometers. Japan is also sending two used offshore patrol vessels and has already sent ten smaller patrol boats. Japan is offering similar aid to Vietnam. China regards Japan as a major (along with the United States) threat to Chinese territorial expansion efforts and is openly warning Japan to back off.

September 5, 2016: North Korea launched three ballistic missiles eastward from a base on its west coast. The three missiles appeared to be Rodongs because they travelled about a thousand kilometers over North Korea and landed off Japan. This was seen as an effort to intimidate Japan, as well as any other neighbors who were hostile to North Korea.

September 4, 2016: Taiwan has ordered an additional 24 UH-60M transport helicopters and is paying the manufacturer $5.7 million each to have them customized with added defensive electronics and the ability to carry heavy weapons. This mod is called “Battle Hawk” but Taiwan did not use that term. In 2007 Taiwan decided to retire its 90 UH-1H transport helicopters and replace them with 56 (perhaps followed by 30 more) UH-60M models. The first four arrived in late 2014 and the last them will be delivered by the end of 2019.