Archive for December, 2015

THE rivalry for the spheres of influence in the Asian region is mainly between two global giants – the existing superpower United States and a fast emerging power, China. China may be perceived as trying to revive its past glory and influence in the region during the Ming Dynasty (1368 to 1644), especially during the period when the commander-in-chief of the largest navy in pre-colonial world history, Admiral Cheng Ho, made seven sea voyages from 1405 to 1433.

Six of Cheng Ho’s voyages included visits to Malacca, where the sultanate established a close rapport with imperial China. The all-powerful Ming Emperor Yongle was known to have granted some form of patronage and protection to Malacca (and the rest of Malaya) against an expansionist Siamese Kingdom. Cheng Ho died on his seventh voyage in 1433. Many of the crew and people who accompanied Cheng Ho settled down in Malacca and married the locals to form the Baba Nyonya community. China and Malacca therefore, have a very special and meaningful historical relationship.

During the period of China’s maritime and naval supremacy, China never colonised, bullied or suppressed the people overseas. Cheng Ho went everywhere he could to seek trading partners, friendship and peace and there was no need for any wars or conflicts.

When Emperor Yongle died in 1424, the subsequent emperors decided to adopt a closed door and reclusive policy as they felt that there was nothing that the world could offer China which it needed. With this policy, world history was changed and it allowed the subsequent western colonisation of much of Asia, starting with the Portuguese in 1511.

The launch by China last year of the Maritime Silk Road (MSR) project, seen by many as China’s answer to the US backed Trans Pacific Partnership Agreement (TPPA) can be perceived as a smart strategic plan to regain its influence over Asia. The MSR, to connect two-thirds of humanity, is probably the largest ever development project in world history and it is focused on “prosper thy neighbour” approach of joint developments and mutual benefits with the countries involved rather than the neo-colonial development model of the past.

China has also laid claims on some resource-rich islands and some countries in the region have also been drawn into these territorial disputes. These disputes must be handled properly, fairly and diplomatically, otherwise they can pose a serious threat to peace and stability in the region.

From a poor agrarian economy devastated by colonisation, wars and many internal upheavals, a united China, after World World II and the civil war with the Kuomintang, has risen rapidly, especially in the last 40 years or so since Deng Xiaoping became the paramount leader in 1978. Like a “phoenix rising from the ashes”, China has made staggering and perhaps frightening economic achievements. It has become the envy of many existing and developing economic powers.

China is now the world’s second largest economy by GDP and catching up fast to overtake the US, still the world’s largest economy by GDP. But China is now the world’s largest economy by purchasing power parity and the world fastest growing major economy.

China is the largest manufacturing economy in the world and the largest exporter of goods. It is also the world’s fastest growing consumer market and second largest importer of goods. It is the largest trading nation in the world.

World renowned economist Joseph Stiglitz, in his famous article entitled “The Chinese Century” published on Dec 31, 2014, made a compelling case that it would be a big mistake for the US to see China as a threat and to try to “contain” China with a Cold War approach as advocated by the right-wing hawks.

The US should instead view the challenge by China as a wake-up call to review and undertake a strategic analysis on how to harness its strengths and overcome the weaknesses of the US economy. It should see China as a friendly competitor whose economic prosperity would also offer many new opportunities to benefit the US.

The world economy is not a zero sum game as promoted by the opponents of China. In fact, Stiglitz argued that China did not want to be in such a pole position so quickly as it came with huge responsibilities and obligations to the global community.

It is clear that China does not want to be seen as a threat to anyone in expanding its economy and business overseas.

Malaysia established diplomatic ties with China in 1974, driven mostly by economic necessity. It was the first in Asean to do so and it paved the way for the other member states of Asean to follow suit.

In the past and before 1974, Malaysia had felt threatened by the support (perceived or otherwise) given to the communist insurgency by the Chinese government. With the control and suppression of the insurgency and assurances by the Chinese government of non-interference in the internal affairs of other countries, the government of Malaysia, then under the prime ministership of Tun Abdul Razak, rightly decided that the country’s economy had a lot more to gain by being a friend to China.

Cash-rich China is investing in Malaysia in a big way and major current investments appear to be focused on its old trading and settlement port, Malacca and in the infrastructure, maritime and tourism sectors. The largest such project is Malacca Gateway, a tourism, entertainment, marine and land reclamation project, which is estimated to be valued at RM43 billion.

Within Asean, Malaysia appears to be the country most liked and favoured by China for investments and is benefiting immensely from the largest and fastest growing economy in the world. With the current (negative) state of the world economy, there are hardly any countries in the world with that kind of financial resources. China may really be the saviour that the Malaysian economy needs and with Malacca now showing the way forward.

So is China a threat to the region?

China appears to be a threat to superpower US but as Stiglitz argued, it does not have to be if the US can take advantage and leverage on the opportunities created and work peacefully together for the equitable benefit of all.

As for the other Asian countries, history can speak for itself. China has never exploited, oppressed and colonised them and it would be folly for any of them to oppose China simply out of fear of its sheer size. It would make more economic sense for them to participate in the MSR and other development projects to gain from a smart and win-win partnership with China based on equity and mutual respect.

The writer is the CEO of a think-tank and strategic consultancy firm, which has developed an “Asian heritage for peace” museum project for the region. Comments: