China: Southern Borders Are Burning

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March 16, 2021: China is angry at its southern neighbor Myanmar (Burma) because a February 1 st military coup put the Burmese army back in charge of the government and unleashed a lot of popular anti-China anger. The Burmese generals had been persuaded to allow democracy to return in 2010 with the understanding that the generals would not be punished for misdeeds during decades of military rule. The generals continue to misbehave after 2020.

Chinese officials met with their Burmese counterparts three weeks after the coup and were assured that the substantial Chinese economic investments in Burma would be protected. The coup put an unpopular military government in control. China thought this would make Burma a more compliant and cooperative neighbor. Within a week of the military takeover anti-military demonstrations began and continued despite police and soldiers ordered to fire on the crowds. That killed or wounded a growing number of Burmese but did not stop the demonstrations. After late February meeting, in which the generals assured China that they would be cooperative, the military government quietly ordered media and diplomatic efforts to play down any cooperation between the military government and China.

By March China was aware that the Burmese generals were playing down any cooperation with China and not doing all they could to protect Chinese factories and infrastructure facilities. So far at least 30 Chinese factories have been attacked and damaged and at least two Chinese injured. The anti-China aspect of the demonstrations continues to grow and the Burmese military seems to be agreeing with the anti-China anger, if only out of a sense of self-preservation.

Right after the coup China and Russia used their veto powers to block UN actions against the new military rulers. The military move was a reaction to recent parliamentary elections that put into power, with over 70 percent of the vote, a political party that pledged to reorganize the military to prevent another military takeover. The response of the military was not unexpected, because the civilian government knew that the Burmese generals had maintained their business connections with China after 2010 and that included China has selling $1.4 billion worth of military equipment to Burma since 2010. Russia sold $800 million worth. Together China and Russia accounted for over 90 percent Burmese spending on imports of military gear. If the elected government were allowed to take power there would be no more future sales and some of the incomplete (not yet delivered) sales would be cancelled. Billions in Chinese transportation and infrastructure investments were also in danger because most Burmese had become very anti-China during the last few decades.

Before giving up power in 2010 Burmese army officers made a lot of money allowing China to do business in the tribal north, often at the expense of local civilians, most of them tribal people. After the return of democracy in 2011, China no longer had as much freedom in the north. China tried to maintain many of these endangered economic projects by including them in the new CMEC (China-Myanmar Economic Corridor) agreement China and Burma signed in late 2018. That agreement called for both countries to begin detailed negotiations on where a 1,700-kilometer-long transportation corridor from southern China (Yunan province) to central Burma (Mandalay) and then west to the coast at the Kyaukpyu SEZ (Special Economic Zone) will be built and what it will consist of. The corridor would improve roads, railroads and build, as needed, pipelines and electrical transmission lines. This would be financed by China and built mainly by Chinese construction firms. During the February meeting China demanded that the army provide more security for the Kyaukpyu facility. Most Burmese not only hate their own military but also new Chinese facilities like Kyaukpyu. The Burmese generals apparently concluded that China had become more of a liability than asset.

Popular hostility to CMEC forced the Chinese to allow provisions in the treaty to minimize the risk of a “debt trap” where Burma might find itself with debt it could not repay unless it turned over new facilities to Chinese ownership or control. This has happened in other nations, most obviously in nearby Sri Lanka. Burma needs the investment and since 1988 China has been the major foreign investor in Burma with projects totaling $20 billion so far. Burma told China it was working on special “debt trap” provisions and the main one is for China to allow foreign nations to provide some of the loans needed for the CMEC work. Details of this deal are still being negotiated. This explains why only a few of the 38 projects that comprise CMEC have so far been approved by Burma. Reaching agreement on the rest of those projects gave Burma some leverage over China.

CMEC is the Burma component of the massive Chinese BRI (Belt and Road Initiative) effort. Also called OBOR (One Belt, One Road), BRI is all about China building roads, railroads, pipelines and ports to make it easier for Chinese imports and exports to move around, from East Asia to Europe, Africa and beyond. Pakistan, Nepal, Thailand, Sri Lanka and Burma are all BRI participants that are seeing billions of dollars in Chinese construction projects taking place and the terms of these deal tend to favor China, not the country where the construction takes place. Not surprisingly many people in these BRI countries see the Chinese investments as another form of colonialism. China prefers not to call it colonialism but rather seeking to expand its commercial activities.

All the Burmese disagreements over border security and CMEC have not slowed down the growth in trade with China. In 2019 that trade increased 38.5 percent over 2018 to $17.7 billion. That is huge considering that the Burmese GDP is $67 billion. That trend continued in 2020, despite covid19 problems.

In early 2020 t he Chinese leader made a two-day state visit to Myanmar. This was mainly about discussing matters of mutual interest with elected Burmese leaders. There were many things to discuss, including the Rohingya refugees, tribal rebel violence on the Chinese border and Chinese investments in Burma. China has been protecting Burma in the UN, where there are calls for punishing Burma over the Rohingya mess. The tribal rebels are largely an internal Burmese matter. Burmese negotiations with the tribal rebels have been heavily influenced by China. That is because China is part of the problem. This state visit was to try and get Burmese leaders to be more cooperative with Chinese investors. That did not happen. There were some token concessions but Burma remains wary of Chinese investments. For that reason, the quick Chinese moves to protect the new military government were not a surprise. The question for Burma is whether there will be a civil war. That threat played a major role in persuading the military to allow democracy to return in 2010. Now the anti-coup demonstrations are growing in size and intensity despite soldiers and police ordered to open fire. Dozens of demonstrators have died and over a hundred have been wounded. Desertions from the army and national police are beginning, with some of the deserters showing up in neighboring countries seeking asylum.

Burgeoning BRI Blues

Burma is one of many nations China has targeted for BRI investments. Burma was not alone in being wary of what China offered with BRI. In fact, only 26 percent of the 122 BRI projects announced so far are assured, with signed contracts and treaties, of completion. Part of the problem is Chinese economic problems. The American-led trade war is causing more problems than expected and various internal problems have slowed economic growth. One of those internal problems is a financial system weakened by years of reckless lending that led to trillions of dollars of bad debt that will take years of tight credit and careful bank management to deal with. That means much less money for BRI projects and “diplomatic loans and investments”.

Iran Irritations

Iran has resumed illegally exporting oil to India and China. This is risky because the tankers carrying these shipments can be intercepted and seized. As soon as the new American government took power in January Iran told current and past customers for discounted smuggled oil that Iranian oil would be more easily available in 2021, either free of sanctions or less vigorously enforced sanctions. Iran was betting that the new U.S. government would ease off on the oil export sanctions. So far this has not happened but the Iranian leaders insist it will happen and soon.

The Southern Front

Down south in Tibet, the Chinese forces have not completed their agreed withdrawal from Indian Ladakh along the shore of Pangong Lake. Last September India and China agreed to halt their operations on the Indian border and continue negotiations. Both sides declared victory but China was the actual winner because now a thousand square kilometers of additional Indian territory along Panglong Lake is under Chinese control. By the end of 2020 the two sides had agreed to pull most of their forces back because of the frigid weather in the high mountains surrounding Pangong Lake. China has been slow to carry out all those withdrawals.

This is another aspect of Chinese SSSN (Shove, Stop, Stands Fast) tactics, which have once again prevailed, as they have many times in the recent past. China initially expressed no interest in retreating but was willing to negotiate. With the cold weather approaching last September India was in no position to refuse the Chinese offer. China believes they will prevail by repeating their SSSN and push Indian forces out of all the disputed areas along their common border. SSSN is slow and it would take decades to grab all the Indian territory claimed by China. As long as China maintains a stronger military than India and can keep more troops near the disputed border areas, India will not feel confident to defend forcefully and risking a large-scale battle on the border. While both nations have about the same population, the Chinese economy is nearly five times the size of India’s. This was no surprise to India, which has put greats emphasis on economic growth since the 1990s. That has paid off, with GDP nearly doubling in the last decade from $1.7 trillion to the current $2.9 trillion. This made India the fifth largest economy, recently surpassing Britain and France. The rest of the top five are the U.S., China, Germany and Japan. Chinese GDP growth is slowing although in the last decade it more than doubled from $6.1 trillion to $14 trillion. But for once annual Indian GDP growth has been faster than in China, where GDP growth rates have been declining over the last five years. Over three decades of spectacular economic growth in China resulted in the Chinese GDP becoming over fourteen times larger than it was in 1989. In that same period the U.S. GDP doubled. After World War II India had a larger GDP than China and never felt the same urgency as China to modernize and expand the economy. Actions have consequences and, in this case, it means China can push India around on their mutual border.

Another reason for this is that India is still haunted by the last battle between Indian and Chinese forces back in 1962. In a month of fighting that began on 20 October 1962, India lost 7,000 troops (57 percent prisoners, the rest dead or missing) compared to 722 Chinese dead. China declared a ceasefire that India accepted. China actually advanced in two areas, a thousand kilometers apart and ended up taking 43,000 square kilometers of Indian territory.

The source of the 1962 war and current border disputes are a century old and heated up again when China resumed control over Tibet in the 1950s. From the end of the Chinese empire in 1912 up until 1949 Tibet had been independent. But when the communists took over China in 1949, they sought to reassert control over their "lost province" of Tibet. This began slowly, but once all of Tibet was under Chinese control in 1959, China had a border with India and there was immediately a disagreement about exactly where the border should be. That’s because, in 1914, the newly independent Tibet government worked out a border (the McMahon line) with the British who then controlled India. China considers this border agreement illegal and wants 90,000 square kilometers back. India refused, especially since this would mean losing much of the state of Arunachal Pradesh in northeastern India and some bits elsewhere there and all along the new northern border.

India, as a democracy with a free press, has a public discussion of Chinese tactics and possible Indian responses. China also tries to take advantage of the Indian media freedom by buying favorable coverage in the Indian press. This is done via bribes, offers of investments or loans as well as economic concessions within China. Military strategy in China, since ancient times, has placed emphasis on having a powerful military but using it mainly as a threat and giving enemies an incentive to accept bribes and allow China to get what they want. Yet India has rarely been seen as an enemy of China. There is nothing valuable on their mutual border which for thousands of years has been along high mountains and thinly populated lowland jungles. Neither India nor China had any incentive to raise large armies to threaten each other.

Because of this background, the border disputes since the 1960s are seen by Indians as inexplicable and by Chinese as overdue restitution for centuries of humiliations inflicted by Western invaders. India, ever since it emerged from centuries of British colonial rule in 1947, insisted that India and China shared a background of oppression by the West. China sees India as trying to perpetuate Western crimes against China. To most Chinese, Indians look and sound like Westerners, so therefore India must be an enemy of China. India has come to accept that the Chinese are obsessed with making India pay for real or imagined wrongs inflicted by Western imperialists and see nothing wrong with using ancient Chinese imperialist methods to get their way. Suddenly British imperialism is not the worst thing that could ever happen to India. China is seeking to provide something much worse and much closer.

The latest phase of this ongoing campaign began earlier this year when China revived its border war with India over Pangong Lake, which is largely in Tibet and connected to Chinese claims on Kashmir territory. This is the longest lake in Asia and part of the 134 kilometers-long lake extends 45 kilometers into the Indian Ladakh region. China is using its usual SSSN 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 soldiers from India or China.

March 13, 2021: China launched three more Yaogan 31 maritime electronic surveillance satellites using a LM (Long March) 4C SLV (satellite launch vehicle). A similar launch was made on February 24th. The three satellites in each four-ton payload were put into a pattern of orbits which enabled the satellites to rapidly locate any ship or aircraft below creating any electromagnetic signals. China only described the two launches as military satellites and no details were released. Western analysts have identified and described the Yaogan 31 birds. In late 2020 there was another secret launch via a LM 4C that apparently put another radar satellite in orbit. China uses these to detect American warships at sea and groups (usually of three) smaller satellites to track ships electronically so they can be attacked by ballistic missiles with maneuverable radar homing warheads. Those missiles have not been seen in action yet but Chinese warships and bombers carry high-speed anti-ship missiles that could use the satellite tracking data.

March 12, 2021: In early 2020 China revived its efforts to force Indonesia to acknowledge Chinese claims on the Natuna Islands and the lucrative fishing grounds there. There are potentially natural gas deposits as well. This latest effort began in late 2019 when Chinese fishing boats began entering Indonesian waters off the Natunas and fishing illegally. There were 30 of these incidents, involving over 60 fishing vessels. All were ordered to leave and were escorted to international waters. But the Chinese kept coming.

For over a year China claims it is trying to settle this dispute peacefully through negotiations. The basic problem is that the Chinese assume that they have some historical right to fish in Indonesian waters while Indonesia insists there is no legal or historical basis to the Chinese claims and the discussions with the Chinese are crippled by their “what’s mine is mine and what’s yours is negotiable.”

Since 2016 China and Indonesia have been unofficially, but very visibly, at war with each other over illegal fishing. Early on Indonesia seized and destroyed a number of Chinese fishing boats and ignored Chinese complaints and threats. China has long been stealing fish (poaching) from offshore areas where the fishing rights belong to other countries. This poaching has been going on with increasing frequency since the 1990s. But now many of the victims have done the math and noted that the most frequent offenders are Chinese ships. These are either Chinese owned fishing ships or ships from other countries that register themselves as Chinese to gain a measure of immunity from being stopped or punished by the nations being plundered. But some nations are not just complaining, they are fighting back. In the case of Indonesia, the resistance consists of shooting at poachers and, since 2014, destroying (via explosives or burning) over 170 ships used by guilty poachers. Indonesia calculates that this poaching costs Indonesia over $2 billion a year and that China’s worldwide poaching operation brings in over $20 billion a year. Since China does not officially admit it is organizing and controlling this, and the Indonesians are using large warships with orders to fire on any poacher caught and refusing to surrender, the Chinese are taking most of the losses off Indonesia. For a while China sent warships to accompany flotillas (often ten or more ocean going fishing ships) and protect the poachers if caught and keep the police or coast guard boats busy while the poachers escaped. But Indonesia responded by sending out warships (corvettes and frigates) with orders to fire on any foreign warships caught with the poachers. China stopped sending warships but the poachers kept on coming and Indonesia keeps capturing and prosecuting the crews. The poacher ships are often destroyed as media events, with local news being allowed to capture and broadcast videos of the fires and explosions.

China has been deliberately sending fishing boats to poach in order to establish a claim that the Natunas are “traditional Chinese fishing areas” and thus belong to China. The 272 Natuna islands are 3,000 kilometers from China and within the Indonesian EEZ (Exclusive Economic Zone). Waters 360 kilometers from land are considered the EEZ of the nation controlling the nearest land. The EEZ owner can control who fishes there and extracts natural resources (mostly oil and gas) from the ocean floor. Technically, most of the Natunas are just outside the Chinese South China Sea claims. At first it seemed China was only interested in poaching, which its fishing ships do as far away as Africa and South America. But now China has expressed an interest in purchasing some or all of the Natunas. The implications is that if Indonesia won’t sell, China will lay claim to the Natunas and take them along with the rest of the South China Sea claims.

March 11, 2021: Ukraine has decided to end Chinese majority ownership of Motor Sich, a major and profitable local defense manufacturer. The government will, in effect, nationalize Motor Sich. While this will annoy China, it will also please the United States, a major ally and supporter of Ukraine in its fight against Russian invaders. The Americans had recently sanctioned the Chinese firms that were buying a majority interest in Motor Sich. The Americans fear that control of Motor Sich would enable China to solve its problems with developing and manufacturing high-performance jet engines. Back in 2019 China went forward with its efforts to buy this majority stake. Many Ukrainians felt China would take advantage of the corrupt government and industry officials associated with firms like Motor Sich to get better deals. These were often at the expense of Ukraine but very lucrative for the corrupt Ukrainians involved. Many Ukrainians, and Americans, realized how China operated in deals like this. If China obtained a major, or majority, stake in Motor Sich they could, and probably would, steal all the technology and manufacturing secrets and eventually move Motor Sich production to China. Initially they would hire some Ukrainian tech experts to help the Chinese manufacturing operation to get up to speed, but eventually Motor Sich in Ukraine would become a branch of the main operation in China. Eventually the Ukrainian branch of the renamed to something Chinese and “Motor Sich” would disappear. Most Ukrainians want to keep Motor Sich Ukrainian and not plundered of all its tech by the Chinese.

March 10, 2021: For the third time this year the U.S. Navy conducted a FONOP (freedom of navigation operation) near China as an American destroyer passed through the Taiwan Strait (the waters between Taiwan and the Chinese mainland). This time a Chinese destroyer showed up at the same time, headed in the same direction as the American warship. Since July 2018 the U.S. Navy has carried out Taiwan Strait FONOPs nearly every month. Until the 2018 FONOP such trips through the Taiwan Strait (which American warships do regularly) were not publicized, something the U.S. had been doing since 2007. The renewal of publicizing these movements annoys China which responded by having their own warships following American warships passing through the Taiwan Strait and increasing Chinese naval ship patrols around Taiwan.

March 9, 2021: The U.S. Navy implied that Chinese use of some of its DF-21D ballistic anti-ship missiles during a training exercise in August 2020 proved the missiles was a real threat. The missiles were launched but were not aimed at any test target so it was unclear if there is yet any proof that these missiles can actually hit a moving ship on the high seas. In November Chinese media reported the same thing. that China had test fired several of its DF-21D ballistic missile from mainland bases into the South China Sea and nearby ocean areas. China claims that one of these missiles hit a moving ship. No comment from Western intel agencies that usually monitor these missile tests. The DF21D was designed to hit American aircraft carriers. Since 2006 there have been stories (in the West) about how China was working on targeting systems for its ballistic missiles that would enable them to seek out and hit aircraft carriers. Such sensors would use infrared (heat seeking) technology. This sort of thing had been discussed for decades, but China appeared to be putting together tactics and missile systems that could make this work. The key was having multiple sensor systems that could find the general location of the carrier, before launching the ballistic missile, like the existing DF-21, with a range of 1,500 to 2,100 kilometers. By 2010 the carrier killer missile was identified as the DF-21D. Since then, this weapon has been tested at least once before, in 2019, when six were fired. The Americans did not release any data they might have had about how successful these 2019 tests were. During periods of military threat, like the Cold War, and current revival of those tensions, it was common for the military on both sides to claim the other side had awesome capabilities that did not exist. The claims were meant to motivate governments to provide lost of money to develop defenses against the claimed superweapons of the other side.

March 8, 2021: Filipino efforts to appease China have been an embarrassing failure. As is their custom, the Chinese promise much and deliver little. China’s offer of negotiations over South China Sea disputes produced nothing for the Philippines. Chinese offers to provide the SinoVac covid19 vaccine backfired when it was discovered that China was charging the Philippines three or more times per dose as other customers in east Asia and Africa. Moreover, the SinoVac vaccine appears to much less effective than Western vaccines also available to the Philippines. Worse, all these negotiations and delays in Chinese deliveries have meant that the Philippines will be the last nation in the region to receive enough vaccine to suppress the covid19 threat.

March 7, 2021: The annual Global Soft Power Index measures the ability of nations to impress others by their economic power and how it is used both internally and externally. China fell from 5th to 8th place because of increased repression of its own people and aggression towards neighbors. The U.S. fell from number first to sixth place because of growing corruption and internal political problems. The political feuding was perceived as the main reason the U.S. was unable to contain covid19.

March 6, 2021: ISIL (Islamic State in Iraq and the Levant) appears to have undertaken an unofficial and unilateral truce with China. That means no more attacks against Chinese in Moslem countries and no more public criticism of Chinese mistreatment of the Moslem Uighurs in northwestern China (Xinjiang province), an area the Uighurs and many Moslems refer to as East Turkistan. The ISIL move was practical, as in there was little chance of success in attacking China or Chinese. What happened in Xinjiang while ISIL was building its “caliphate” in eastern Syrian and western Iraq was scary, and ISIL members don’t scare easy. China came to be viewed as an even more dangerous foe than Russia and even hardcore ISIL backed off from including China on their target list. This applies to Moslem majority governments in general, which criticize real or imagined persecution by Infidel (non-Moslem) nations. But not China. While most Western nations criticize Chinese persecution of Uighurs there is little criticism from Moslem majority nations. The main reason is assumed to be economic as China is a major importer of oil from Moslem states and a major source of imports, including high-tech stuff and even weapons. China will sell to anyone who can pay and that appeals to many Moslem majority nations who are unable to get some Western weapons because of fears about how it will be used. An example of this is armed (with laser guided missiles) UAVs. The U.S. refused to sell these to many Moslem states because of fears they would be used against civilians. No problem with the Chinese, who now dominate the market for UAV exports to Moslem nations.

March 4, 2021: The U.S. has approached Japan, Taiwan and the Philippines about their willingness to host island based American surveillance and anti-ship missile bases to contain Chinese aggression in the South China Sea. The United States would spend nearly $5 billion on establishing these bases and provide personnel and financial support to keep them operational. It may be a while before these three nations respond. China will promptly denounce the idea and pressure the three proposed host nations to reject the American offer, or else. Freely available commercial satellite photos show China continuing to build and expand its military bases in the South China Sea, most of them located on artificial islands created by dredging nearby sandbars for sand to build reefs into islands.

February 22, 2021: East Asian nations, including, China kept their covid19 infection rate low. That had little to do with being a communist police state because democracies like Taiwan, Singapore, Japan and South Korea produced verified results that showed how a disciplined response can keep covid19 infections and deaths at very low levels. While most Western nations reported covid19 death rates of 800 to 1,600 per million, South Korea reported 31, North Korea falsely reported none at all, Japan reported 59, Singapore five and Taiwan 0.4 per million.

China not claims it suffered only three deaths per million population capita and much less economic disruption than other industrialized nations. The lower economic disruption is obvious. South Korea suffered much less than other industrialized nations, seeing its GDP shrink only one percent. The only nation with better performance were Norway, which suffered 0.8 percent contraction and China claimed 2.3 percent GDP growth. China admits it has a problem with the accuracy of economic and other data. It will take a few years before economists and other researchers can discover that really happened in China during 2020. Unofficial reports from China indicate that Chinese covid19 deaths were much higher than reported. Even with that most Chinese were confident enough to go back to work, and large public gatherings like mass transit or movie theaters. To maintain this covid19 advantage China still sharply restricts Chinese from travelling outside the country and quickly quarantines any areas where more covid19 appears. The lower infection and death rates are the result of populations accustomed to acting in a unified and precise manner when confronting an emergency. North Korea has a long border with a populous and industrialized region of China and what happens in northeast China gets into North Korea and the rest of the world via cell phones and the Internet. Reports of local covid19 outbreak lockdowns in northeast and other parts of China continue to get into circulation.

February 17, 2021: China and Russia have agreed, after more than a year of negotiations, to develop a joint BMEW (Ballistic Missile Early Warning) system. This involves Russia providing the tech needed to bring Chinese BMEW equipment up to Russian standards. As an incentive for Russia to cooperate, and provide the needed tech, Chinese Internet censors were ordered to allow open discussion about Chinese claims on a quarter of the Russian Far East and most of the prime coastal areas. China never cancelled these claims, even in the 1940s and 50s when China was very dependent on Russia. These claims amount to about nine percent of Russian territory. The Russian Far East contains part of Siberia as well as the large Pacific Ocean coastline and the port of Vladivostok. The coastal areas are the most densely populated. The Russian Far East is huge, at 6.9 million square kilometers. That is nearly the size (eight million square kilometers) of the continental United States. While these 48 states have 310 million people, the Russian Far East only has a population of 8.3 million. The Far East region contains 40 percent of Russian territory and less than six percent of Russia’s population. The region contains many naval and ballistic missile bases as well as ports that provide the cheapest way to get goods from the rest of Russia to the Far East. The Trans-Siberian Railroad alone cannot support the population and economy of the Far East region.

February 15, 2021: During 2020 China often halted deliveries of gasoline and diesel fuel to North Korea because the Chinese deliveries were not being used in the market places, where everyone had access, but diverted to the military. North Korea kept promising to comply with Chinese restrictions and kept getting caught cheating. Smuggling these fuels via ship-to-ship transfer at sea was limited by increased scrutiny and more North Korean tankers being caught and seized. At the end of 2020 North Korea assured China that is would not cheat on fuel allocation and evidence was visible in early 2021 as market prices for gasoline and other fuels declined. Imports of refined petroleum products from China and Russia during the first six months of 2020 were only 17,000 tons, half what came in during the first six months of 2019.

 

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