China: Everything Is Just Fine


August 6, 2020: China and America are at wat, at least as far as the CCP (Chinese Communist Party) is concerned. The basis of CCP rule in China is economic prosperity. Chinese tolerate the police state antics of the CCP as long as the economy keeps growing. Now the foreign victims of Chinese aggression (economic, Internet based espionage and theft and more) are fighting back. This comes after years to demanding that China back off with the illegal behavior. Sometimes China said it would but did little or nothing. Often China denied there was any misbehavior. Now the foreign victims have gone from ask to attack. This comes at the worst possible time because the Chinese economy is already suffering from covid19 problems (internal quarantines and worldwide recession) as well as massive corruption, an aging population and a labor shortage. All this brings China closer to an even bigger economic disaster; a banking system collapse brought on by a massive real-estate bubble.

Destroying Hong Kong autonomy and economic benefit, which is a loss to all of China, is seen as another example of the CCP sacrificing the welfare of all Chinese in order to maintain the power of the CCP. Just another corrupt dynasty according to Chinese history and CCP leaders as well as most Chinese know how that usually ends.

The CCP has been trying to use nationalism to improve their image with most Chinese. That worked for a while, but it eventually helped turn trading partners into enemies. While many Chinese are still angry over century (or centuries) old injuries China suffered, Chinese trading partners are dealing with very recent, and often ongoing injuries.

China is increasing its military pressure over territorial claims in the South China Sea and on the Indian border. In addition, there is widespread Chinese misbehavior everywhere else. This often involves theft of trade secrets and whatever else can be taken via Internet hacking. Chinese trade and investment practices are increasingly condemned and rebuffed.

China is suddenly on the defensive but does not want to admit it.

August 4, 2020: China’s first 40,000-ton Type 075 LHD (Landing Helicopter Dock) amphibious ship began sea trials. This ship is designed to carry 30 helicopters as well as landing craft operating out of the well dock in the rear. These would move up to a thousand marine infantry troops carried on the ship to landing zones ashore. At present it appears that three Type 075s are planned and how many more are built will depend on how well the first Type 075s perform in service. These ships appear to be 250m (820 feet) long and 30m (99 feet) wide. The Type 75 is similar to the eight American 41,000-ton LHD helicopter carriers that are capable of carrying up to twenty F-35B vertical take-off fighters. The design of these American mini-carriers began with the eight Wasp class LHDs. The last of these amphibious assault ships (Makin Island, LHD-8) entered service in 2009 and was followed by two more that had some drastic modifications that led them to be designated LHAs because they were a bit larger (45,000 tons) and did not have the internal dock for landing craft. The additional space was devoted to more fuel, weapons storage and aircraft maintenance. The first of these ships (LHA-6) entered service in 2014 and the U.S. Navy would like to have six of these LHAs but that depends on money being available.

August 2, 2020: China has made a sale of one of its air defense systems to a European nation; Serbia. The air defense system is the FK-3, which is the export version of the relatively recent HQ-22. Described as similar to the American Patriot System, HQ-22 was introduced in 2016 by a Chinese competitor of the firm that developed and produced the HQ-9. China encourages this kind of competition and it pays off. Neither the HQ-9 not the HQ-22 have any combat experience.

The HQ-9 was always described as roughly equivalent to the U.S. Patriot. Most of the current Chinese long-range antiaircraft systems are the Chinese designed and manufactured HQ-9. China began introducing the HQ-9 in 2001. It was a much less capable system back then. Over a decade of development was believed to have benefitted from data stolen from similar American and Russian systems. A version of the HQ-9 is deployed in ships as well.

China has been cultivating Serbia for nearly a decade. In 2011 China was expanding military cooperation with Serbia. This was part of China's "Partners With Pariahs" (not the official name) program. China will hook up with anyone who might be useful, no matter the judgment of world opinion. China does business with Zimbabwe, Libya, Burma, North Korea, Iran and numerous other international bad boys. It's just business and it paid off with Serbia in a substantial sale of air defense equipment.

August 1, 2020: Hong Kong lost its bid for autonomy and is now seeing its freedoms and economic strength dismantled. It is still unclear how many residents will flee China. It could be several million. China seems inclined to let them go and accuse nations that accept the refugees as interfering in Chinese internal affairs. The nations involved point out that China is the outlaw in this situation, blatantly violating the 1997 treaty it signed with Britain. About half the seven million Hong Kong residents could accept the British offer passports and use those passports to move anywhere in the West, most likely to Singapore, Australia, Taiwan, America or Europe. China is forcing this decision by arresting, and moving to China, more and more protest leaders and prominent protesters in general. There is now censorship in the media and bookstores. Western nations are curbing or cutting their economic connections with Hong Kong. For the locals, Hong Kong isn’t Hong Kong anymore.

July 30, 2020: Major investors in China, like Japan, Taiwan and the United States, are encouraging manufacturing operations to either return home or move to another country in Asia. Apple is moving iPhone manufacturing to India. Japan is spending over a billion dollars to help Japanese firms move their operations out of China. Taiwan is doing the same. China is seen as an increasingly hostile and unpredictable place to do business and the move out of China, which began a few years ago, is accelerating.

July 28, 2020: In the southwest (Tibet border with India) China and India are not withdrawing their forces before the six month deep freeze descends on the region. Both sides are providing cold-weather shelter for their troops and stockpiling food, fuel and other supplies. Earlier in 2020 China revived the border war over Pangong Lake, which is largely in Tibet and patrolled by a small Chinese naval force. Commercial satellite photos (something China has not managed to censor yet) showed what was really going on. Throughout July China spread out its forces on the lake coast and did not withdrawn any of them as they had assured India they would.

Pangong is the longest lake in Asia and part of the 134-kilometer long lake extends 45 kilometers into the Indian Ladakh region. China is using its usual “sneak, grab and stay” tactics to slowly move the border into territory long occupied by India. The portion of the lake shore in dispute has no native population. The only people who visit the area are Indian or Chinese soldiers China has moved several commercial and military ships into the area of conflict. The satellite photos show a floating dock that had been towed to one location, making it easier for China to being in supplies and more troops. By September the cold weather will begin freezing over the lake surface. This freeze usually lasts from October to March or April. For at least three months the ice is thick enough for light vehicles (SUV and pickup truck size) to move across the ice.

By the end of June Chinese troops have occupied about eight kilometers of Indian territory along the north coast of Pangong Lake. Chinese troops have erected large signs on the shoreline indicating the newly occupied area is now Chinese territory. China has moved another 20,000 troops, including light tanks and other armored vehicles to the Ladakh sector. Another 10,000 troops are kept about a thousand kilometers away, in Chinese lowland territory where altitude sickness is less of a problem. China has most of the high ground and that limits the number of combat capable troops it can bring to its side of the border. Both sides have moved more warplanes and helicopters to nearby airbases and these aircraft are regularly flying over Pangong Lake.

July 24, 2020: Efforts to enforce sanctions against North Korea are now paying attention to the “secret” 2017 deal whereby North Korea sold Chinese companies the fishing rights for certain valuable species, like squid, that are valuable mainly as export items. This was tough on North Korean fishermen, but the North Korean government needed the foreign currency and selling fishing rights to Chinese firms was the easiest way to get the cash. Since then the Chinese fishing boats enter North Korean fishing grounds and take squid and other seasonal and exportable species. The sale of fishing rights was never a secret but it was never officially acknowledged by those buying and selling. Now questions are being raised and accusations made. The sanctions also banned selling fishing rights but that has proved hard to enforce.

July 23, 2020: China has gone public with its criticism of Russia for not delivering more missiles for the S-400 air defense batteries China purchased from Russia. The second shipment of Chinese S-400 equipment arrived by ship in December 2019, about a year after the first shipment. Another shipment, of missiles, was supposed to arrive in February but did not. Russia offers no explanation or a new delivery date. China already has some S-400 missiles but not enough for the S-400s to be used in a major conflict.

July 22, 2020: According to official data trade between North Korea and China declined 70 percent during the first five months of 2020. There has been some smuggling, which China does not disrupt as in the past. But on the North Korean side of the border there have been seriously effective efforts to reduce smuggling, mainly because of the risk of bringing in covid19. The reduction in legal and illegal trade had reduced North Korean cash reserves and caused unprecedented shortages throughout the country.

July 20, 2020: Five Australian Navy ships passed through the South China Sea on their way to a joint training exercise with American and Japanese warships. Unlike 2019, this time the Australian ships did not get close than 22 kilometers to a Chinese claimed island, or artificial island. That is what the U.S. Navy considers a FONOP (freedom of navigation operation). In one 2019 FONOP American and Australian warships together carried it out. China issues warnings and accuses the Americans of troublemaking because of these FONOPS. There were seven American South China Sea FONOPs in 2019, five in 2018, six in 2017 and three in 2016. Since 2015, when Chinese South China Sea claims became a major issue, the Americans have carried out more FONOPS in the South China Sea each year.

China lays claim to two million square kilometers of open water, which is 57 percent of the South China Sea. China continued its policy of not interfering with FONOPS but does sent warships to follow the foreign ships. There are two ways China can enforce its sovereignty and exert control over its territorial waters. The traditional response is to attack intruders with gunfire or missiles. Then there is the preferred Chinese method of swarming around the intruder with commercial, coast guard and even navy warships and combat aircraft. This has included causing collisions (often just “bumping”). China does not want a war with the United States, mainly because of the economic risks which could lead to more unrest inside China. Interference with seaborne trade and trading relationships in general would disrupt the Chinese economy and threaten CCP control. What China has demonstrated is a willingness to do everything short of war, especially if they can reasonably claim victim status. Australia and China are engaged in a major diplomatic and economic dispute. Australia accuses China of trying to use trade restrictions (reducing purchases from Australia) to coerce Australia into doing what China wants. Even though China is the largest customer for Australian exports, this coercion is not well received in Australia. One response from Australia was to repeat its accusations that Chinese claims in the South China Sea are illegal. At the same time Australia acknowledges that China has militarized its bases in the South China Sea and that makes it riskier for foreign warships that carry out FONOPS there. Australia has increased its military spending because of the growing threat of attack by China.

July 19, 2020: Only 147 North Koreans made it to South Korea during the first six months of 2020. Nearly all of them followed the traditional route through China and that was the problem. Much tighter security on the North Korean border and covid19 related movement restrictions inside China (and North Korea) reduced the number of defectors (compared to 2019) by over 80 percent. This is part of a trend because increased border security imposed since Kim Jong Un became the hereditary dictator in North Korea in 2011 has soon had the number of North Korean defectors reaching South Korea decline 52 percent (to 1,396) in 2014 from the peak year (2,914 in 2009). This was accomplished with the cooperation of China. To make it all the way to South Korea requires getting to a country, like Thailand, that has South Korean embassy and local police who tolerate North Korean refugees arriving to visit the embassy for sanctuary and transportation to South Korea. For many escapees it is easier and cheaper to stay in China or go to some other country. China tolerates this as long as the North Korean illegals behave and, if caught, provide useful information about what is going on inside North Korea. While the cost of hiring a people smuggler to get you into China has doubled (and doubled several more times) since 2011 there are a growing number of relatively wealthy people in North Korea (because of the legalized markets) and many of them are getting out. There are about 35,000 North Korea refugees in South Korea and about three times as many in China and a smaller, but growing number showing up, often illegally, in other countries.

July 16, 2020: Off the north coast of Somalia warships from Japan, South Korea and Spain took part in two days of naval exercises. The ships are part of the anti-piracy patrol. Pirate activity is way down and some nations have their anti-piracy ships spend of their time watching the coast of nearby Yemen (where some pirates have been operating) and the entrance to the Red Sea and the Persian Gulf, where there has been a lot of arms smuggling (to Shia rebels in northwest Yemen) by Iran.

July 13, 2020: The U.S. took a stronger stand against Chinese aggression in the South China Sea by declaring Chinese claims to offshore resources across most of the South China Sea completely unlawful, as is its campaign of bullying to control these resources. In 2016 an international court ruled against China and stated that occupying uninhabitable rocks and building artificial islands did not confer an EEZ (Exclusive Economic Zone). Ownership of “rocks” gets you, at best 22 kilometers of territorial waters from the edge of each rock rather than 360 kilometers for EEZ rights. Before this change the U.S. merely called for China to comply with the court ruling, something China said it would not do even before the court completed its deliberations. The Americans did continue to carry out aerial and naval FONOPs to assert the right of innocent passage. This annoyed the Chinese, who claimed most of the South China Sea was under Chinese control and no foreign ship or aircraft could enter without permission.

The FONOPS will continue, and probably become more frequent. More importantly the U.S. will now actively oppose all illegal Chinese claims that the 2016 court ruling agreed were invalid and not legally enforceable by China. The U.S. has already increased aerial reconnaissance over the South China Sea, which not only monitors what the Chinese are doing but also documents ongoing Chinese violations of international law.

Before this change in American policy China was confident it could bully the nations bordering the South China Sea that were suffering from the Chinese aggression. That bullying will be more difficult if the victims can call on the Americans for backup. Japan is now more confident in continuing its support for the South China Sea victims.

July 11, 2020: In the South China Sea an American destroyer conducted another FONOP, the first since May and the sixth one for 2020.

July 10, 2020: Russia and China both vetoed UN efforts to extend aid shipments to Islamic terrorist held Idlib province in northwest Syria via Turkey. Russia, Syria and Iran want the Islamic terror groups in Idlib destroyed. Turkey opposes this because many of those Islamic terrorists as well as civilians seen by Syria as supporters (and subject to punishment or death) will seek asylum in Turkey. Russia is willing to allow aid to come in via Syria but that would enable the Syrians to manipulate aid deliveries to favored factions and make it easier for Syria to shut down all rebel/Islamic terrorist activity in Idlib. Russia already got the Idlib aid coming in via Iraq and Jordan halted. Shutting down the aid via Turkey means air groups have to deal with the Syrian government, which is considered an outlaw operation and guilty of war crimes. Russia believes that if it becomes the most useful foreign supporter of the Assad government Russia will have a reliable foothold in the Middle East for a long time. That only happens if Russia can work things out with Turkey and maintain their traditional good relations with Israel. China also seeks to improve ties with Turkey and votes with Russia in situations like this.

China’s new KZ (Kuaizhou)-11 solid-fuel satellite launcher failed about a minute after its first commercial launch when the third stage motor failed to ignite. This first launch was supposed to have been in 2018 but there were technical delays. A second KZ-11 launch was already scheduled for late in 2020 and it is not yet known if that will be delayed. The 78-ton KZ-11 is a larger commercial version of the military LM (Long March) 11. KZ-11 is operated by a commercial launch service company and offers a cheaper (about half the current price) way to get satellites in orbit. The KZ 11 takes much less time to get ready and that’s because the KZ 11, like the LM 11, uses three solid fuel rockets. The LM-11 and KZ-11 are both based on the DF-31 ICBM and are launched from a TEL (transporter erector launcher) truck that moves the rocket to the launch site. China has set up a separate company (Expace) for KZ 11 commercial launches that enable customers to get a satellite into orbit in less than 24 hours.

July 9, 2020: China has become the ultimate fiscal lifeline for Pakistan. Decades of deficits, growing corruption, excessive defense spending and military domination have left Pakistan broke and few willing to give or lend enough cash to keep Pakistan solvent. A recent example of how this works was seen when despite economic recession and a public debt crisis (no one will lend to Pakistan anymore), the Pakistani defense budget was increased twelve percent for 2020, with annual spending now $7.85 billion. Spending on dealing with covid19 has averaged about $100 million a month and by the end of the year military spending will be at least five times what was spent on covid19. The India defense budget is also up (13.6 percent more) in 2020 to $66 billion.

The only economic relief available to Pakistan is China and CPEC (China-Pakistan Economic corridor). CPEC is a vast Chinese investment and construction effort that depends on vigorous support of the Pakistani military to succeed. China needs the Pakistani military to keep Islamic terrorists and tribal separatists from attacking the Chinese construction projects. Pakistan also helps China by keeping Indian forces occupied in Kashmir and the northwest Indian portion of the Pakistani border.

July 8, 2020: The United States has agreed to Japanese terms for Japan to obtain another 105 F-35 stealth fighters. This will cost $23 billion and include spare parts, including 110 engines and additional electronic and other accessories. With earlier purchases this new order will give Japan 147 F-35s. That large force of stealth fighters won’t be in service until the mid-2020s because of production for about five years because of growing demand for F-35s and limited production capability. Japan will help by manufacturing some components and assembling their F-35s in Japan.

All this Japanese F-35 news was not welcome in China. Combined with South Korean F-35s China now has to deal with over 300 F-35’s operating near their northern borders. In the 1990s Chinese support for an aggressive and unpredictable North Korea prompted South Korea to become a major developer, manufacturer and exporters of modern weapons. Now Japan, with a larger population and industrial base than South Korea has followed South Korean in an arms race with China.

July 7, 2020: In Iran a draft of a 25-year economic/political/military agreement with China was leaked. Some details of the agreement are still being worked on, but the draft document indicated Iran was willing to make a lot of concessions to become a close economic partner of China. That would mean China would have an incentive to protect Iran diplomatically and militarily. The document makes Iran the major supplier of petroleum to China and China the major source of foreign investment as well as becoming Iran’s largest trading partner. It also included Iran reducing economic cooperation with India.

July 6, 2020: In the southwest (Tibet border with India) China began withdrawing additional troops it had brought up to the India/Tibet border and into Indian Ladakh State. It is unclear how much additional territory in the Galwan Valley and along Pangong Lake China now controls. As part of this temporary peace deal each country agreed to pull its forces back about a mile (1,500 meters) from the scene of the hand-t0-hand battles that left over fifty Chinese and Indian troops dead and many more wounded. During the negotiations for the Galwan River Valley ceasefire and withdrawal China revealed that it now claimed territory extending 800 meters into India that China had never claimed before.

In June China has, for the first time, claimed ownership of the Indian Galwan River Valley. As is the Chinese custom, a major show of force attempts to push back Indian border forces without triggering a shooting conflict. China then reinforces the area with more troops, agrees to negotiate, withdraws some of its troops to keeps some of them occupying small bits of territory that China has never held before. This is an ancient Chinese strategy that worked in the South China Sea and to a lesser extent on the Indian border. China tried it against the Russians in the early 1970s and almost triggered a nuclear war. China does not want to repeat that sort of thing with India. As a result all you see as slow-go advances.

July 3, 2020: In the south (Burma) fighting between tribal rebels and the Burmese army has intensified over the last few weeks and over 40,000 villagers have fled their homes. In Shan State many are fleeing into China. Burmese army leaders have become more outspoken about “foreign support” the tribal rebels are receiving. The generals won’t come right out and name China, but it is no secret that China has done little to curb Chinese weapons dealers from selling all manner of military small arms to tribal rebels and getting it across the border into Burma. That cannot be done without the acquiescence of the Chinese government. In this way the Chinese are sending a message to the Burmese generals, who the Chinese see as equally responsible for the violence in the north, sometimes right on the Chinese border. Both the rebels and the army are often using Chinese weapons and ammo against each other. There are not a lot of casualties and most of them are from army convoys being ambushed or the army firing into pro-rebel villages to drive the civilians, and any rebels, out and into the bush. The army does not have enough troops to occupy all the territory they push tribal rebels, and civilians, out of. Often the rebels, if not the civilians (at least not right away) come back and resume attacking convoys and patrols.




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