China's Asian Dream: Empire Building along the New Silk Road by Tom Miller
My rating: 4 of 5 stars

Tom Miller, a former journalist and senior analyst at Gavekal Research, is a China expert who has spent years in the country and Asia more broadly, and can speak and read Chinese. This is his second book; the first one, China’s Urban Billion was published by Zed in 2012. He is in an excellent position for having written China’s Asian Dream, that focuses on China’s strategic vision and actions to reclaim what it sees as its rightful place as the undisputed leader in Asia. The book gives a systematic and lively treatise of China’s aspirations on the continent and in the world. It paints a picture that poses significant challenges not only to the neighboring countries in the region, but to the West and the United States in particular.

The first part of the book provides a broad historical and geopolitical context, including a brief overview of China’s long history and its humiliation by Britain and the British East Asia Company in the 1939 Opium War and the 1942 Treaty of Nanking that forced China to open its ports to foreign trade. Then in 1895 followed the defeat in the Sino-Japanese war, no less by a country that China regarded a little brother. Then in 1931 Japan invaded China’s northeast setting up Manchukuo, a puppet state. In 1937, a full-out war broke with Japanese domination for years to come. These were humiliations that China has never forgotten (although Mao later thanked Japan for the invasion, as it eventually enabled the successful Communist takeover in 1949).

Chapter 1 after this introduction tells about the ongoing effort by China to establish a ‘New Silk Road,’ what it calls ‘One Belt, One Road,’ connecting China to its neighbors through both a terrestrial and maritime route eventually leading to Europe. The initiative is tied to financing by the Silk Road Fund and the newly established Asian Infrastructure Development Bank. The aim is to tie Asian countries more tightly to China’s sphere of interest through extensive investment in infrastructure. This more proactive strategy, as Miller points out, is a clear departure from China’s earlier foreign policy established by Deng Xiaoping that “diplomacy must serve the greater goal of domestic development” (p. 26). The current President Xi Jingping has taken a much more aggressive stance in promoting Chinese interests abroad.

The rest of the book is divided into sections based on geography. Here Miller reports first-hand accounts from his travels often to remote local areas in the countries. The first such section focuses on Central Asia, including China’s western Islamic dominated province of Xinjiang (literally, ‘New territory’). The Central Asian republics of Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan and Turkmenistan used to belong to the Soviet Union and, while becoming independent after the breakup of the empire, have maintained close ties to Russia. Recently, however, China has made a concerted effort to muscle itself into Central Asia and its expansive oil fields. “Economically, China – not Russia – is now top dog in Central Asia,” writes Miller (p. 75). However, business for the Chinese traders is not always easy, given the need to routinely bribe border guards and the occasional troubles that break out. Tens of thousands of Chinese have settled into Central Asia, but most of them see them as temporary visitors making some money for a few years before returning home. While the Chinese investment is welcomed by the governments, local people fear they are being overtaken by the Chinese – a theme that is quite common throughout the book. Russia at the same time is concerned about losing its grip on Central Asia. Local people in the Stans are worried about Russia’s intentions, especially after Putin’s annexation of Crimea in 2014. Russia remains militarily dominant in the region and its cultural ties to Central Asia are definitely closer than those of China.

The next part deals with Laos and Cambodia, two of Southeast Asia’s poorest countries downstream in the Mekong basin from China’s Yunnan Province. Yunnan shares a 4,000 km long border with Southeast Asia and the Chinese planners have made it a priority to connect these two parts with extensive road and railway connections, as well as air links. China has designated Yunnan as ‘bridgehead’ for Southeast Asia’s development. As Miller notes, ‘bridgehead’ is a military term, which may have unfortunate connotations (p. 98). Laos is also one of the few remaining communist countries ruled by the Lao People’s Revolutionary Party. It is traditionally closely allied with Vietnam and was heavily bombed by the American air force during the Vietnam War, although Laos was not officially a party in the war. When I worked there a decade ago, the Vietnamese presence was still prevalent and Thailand also had a strong influence. In the northern parts of the country, however, you could see an increasing Chinese influence. Today the capital city, Vientiane, has been transformed by Chinese capital. Miller reports from Udomxai, the biggest town in northern Laos where the Chinese make up some 15% of the inhabitants. Even Chinese farmers are moving to Laos to take advantage of the country’s cheap and fertile land. Moving to the infamous opium growing Golden Triangle where Laos meets Thailand and Myanmar, Miller finds industrial scale agricultural plantations operated by the Chinese. Chinese-owned casinos have sprouted up there to cater to Chinese and Thai gamblers; and even the working girls are imported from China (p. 111). Further south, in Cambodia, the Chinese money and influence are equally important and eagerly received by the thuggish Hun Sen regime, which ranked as one of the most corrupt countries in the world by Transparency International. As a consequence, Cambodia has often been out of line with its fellow members of the Association of Southeast Asian Nations (ASEAN), regularly supporting China in its controversial and expansionist policies pertaining to Tibet, Taiwan, Xinjiang and, importantly, the South China Sea. While the elites in these countries are all too happy to receive China and its investments, the relationships between the regular people and the Chinese immigrants who are not known for their respect for other people’s cultures is not always equally friendly. Furthermore, as Miller points out, there is a fine balance to be achieved in foreign relations: for instance, China’s increasing influence in Cambodia is resented in Vietnam (p. 124).

Myanmar provides a cautionary tale as to the perils of associating with undemocratic and corrupt regimes. In the following chapter Miller reports on how China “lost” Myanmar, where it was the closest (in fact only) international ally to the notorious military regime. When the junta dissolved in 2012, anti-Chinese protests ensued, in particular against Chinese state-owned firms operating a giant dam, a copper mine, and oil and gas mines. The Chinese were accused of taking land with poor compensation from locals, as well as destroying the environment and ransacking natural resources (p. 127). Myanmar’s democratic transition coincided by the American government’s ‘pivot to Asia,’ which worried China. Anti-Chinese feelings are widespread in Myanmar and the democratization and consequent freedom of expression led quickly to popular protests against China. Public pressure even caused the new president to suspend work on the $3.6 billion Myitsone Dam that was a Chinese flagship project. The leaders in China were shocked about how popular opinion could lead to such a disastrous outcome – obviously, they were not used to the fact that people’s views mattered – and Chinese analysts started talking about the ‘loss’ or Myanmar (p. 128). Miller claims that in the recent years the Chinese firms have started to understand that they need to improve their relations with local populations (p. 134). The Chinese state has also taken unprecedented steps as a mediator between the government of Myanmar and the Kachin rebels up north. Despite the tensions China should not be counted out in Myanmar. Trade between China and Myanmar stands for a high share of Myanmar’s GDP – and this is not counting the highly significant illegal trade in timber, opium, meta-amphetamines and jade. The environmental watchdog Global Witness estimates that the jade trade in alone 2014 was worth a whopping $31 billion and a significant driver of the armed conflict with the Kachin (p. 141). In the late 1990s, when traveling in the border region of Yunnan and Myanmar, I could witness an incredibly buoyant trade in jade that was by no means under ground. Miller travels to Lashio, the largest town in northeastern Myanmar to seek evidence of a reported ‘Chinese invasion,’ but finds little by way of new arrivals. He concludes that Myanmar doesn’t need to worry about being overrun by Chinese people, but rather by Chinese money: “Myanmar’s problem is less one of outsiders arriving and taking over than one of outsiders taking what they want and then leaving” (p. 148).

One of the reasons why Myanmar is so important is because of China’s desire to gain access to the Bay of Bengal. Such a western seaboard for China would notably improve its energy supplies and reduce the risks of importing most of its oil through the narrow Straits of Malacca that could be blocked by US or other war ships during a time of conflict. Some years ago the Chinese national petroleum company constructed oil and gas pipelines from the Myanmar coast to Yunnan. These pipelines, which were subject to protests during their construction, started pumping natural gas from the Myanmar’s Shwe gas field in 2013 and two years later the first oil was pumped, bringing billions of dollars to the government of Myanmar as well as benefiting China. A Chinese port on the Bay of Bengal is also seen as important for facilitating exports to Bangladesh, India and beyond. Importantly, the economic corridor from Yunnan to the Bay of Bengal allows Beijing to extend its sphere of influence to the Indian Ocean (p. 150). Miller concludes that much depends on how Myanmar’s new government, in effect led by Aung San Suu Kyi, receives China’s approaches and whether Chinese companies there behave responsibly.

In a chapter entitled “A String of Pearls” Miller turns his attention to the Indian Ocean where China has become increasingly active. Indian analysts believe that the Chinese are systematically building naval bases around Indian ocean establishing what they have called ‘a string of pearls’ in order to enhance their dominance of what India considers their backyard. India and China have a half century long history of mutual distrust. Latest this summer, the two countries’ armies were at loggerheads across their land border in the Himalayas. Indian concerns about the ‘string of pearls’ has further intensified since Xi Jinping announce the plan to build a Maritime Silk Road in 2013 (p. 167). Indian analysts that Miller has talked to see China’s advancement as a conscious step by Beijing to expand its dominance in the region. While India could benefit from cooperating with China on initiatives, such as the Bangladesh-China-India-Myanmar Economic Corridor, there are significant security-related concerns. In Miller’s judgment, these are exaggerated: “Beijing is far more interested in securing alternative routes for its energy imports and in protecting commercial sea lanes than it is in building a new empire” (p. 171). This despite the fact that Miller recognizes that China’s schemes have geostrategic as well as commercial motives. India is concerned about Sri Lank sliding into China’s sphere. However, a particular sore point is the long-standing friendship between China and Pakistan, an expression of which is the Chinese port development in Gwadar on the coast of Baluchistan and the associated plan to develop a China-Pakistan Economic Corridor running from Gwadar to the Chinese border and Kashgar in Xinjiang. Apart from opening up an alternative route for energy imports, according to Miller, China also wants to use this massive economic cooperation to persuade Pakistan’s government to rule in Islamic extremists whose tentacles reach across the border to Xinjiang (p. 176). Importantly, the Gwadar port provides a valuable permanent maritime base for China on Indian Ocean, near the shipping lanes from the Middle East and Africa.

China had a close relationship with the government of Mahenda Rajapaksa, former dictatorial and thuggish president of Sri Lanka, supplying the bulk of arms he used in the prolonged civil war against the Tamil population in the north of the island country. During that period, Chinese banks financed major projects in Sri Lanka constructed by Chinese firms. The banks loaned money at high interest rates so that these could be used to provide kickbacks to Rajapaksa and his cronies. After the civil war ended and Rajapaksa died, these high interest rate loans have been a major bone of contention between the new government and China. As Miller states: “For China, Sri Lanka offers a test case of how nimbly its leaders and enterprises can react to the vicissitudes of foreign politics” (p. 195). He quotes a Sri Lankan intellectual saying: “The Chinese do not quite understand how to deal with countries that are democracies, where you have political transitions as we have seen here .. They would rather deal with a corrupt dictatorship and not worry about it.”

The final chapter of the book deals with the fiery waters of South China Sea, an area where tensions have risen in recent years as China has aggressively pursued an expansionist policy (see also Hayton, 2014; Kaplan, 2015). China has claimed sovereignty over most of South China Sea causing conflict with many of its neighbors. It claims the Paracel Islands southeast of Hainan. These are also claimed by Taiwan and Vietnam, but China has controlled them since it wrested them from South Vietnam in a maritime battle in 1974. Much further away from the Chinese mainland and its exclusive economic zone as recognized by international law lie the Spratly Islands, which are also subject to disputes between China, Vietnam, Malaysia, Philippines, Brunei and Taiwan. Using its military power, China has in the past several years focused on creating ‘facts on the ground’ by carrying out massive reclamation works to create artificial islands and building garrisons on them. The Chinese government has, somewhat disingenuously, used both claims based on international law and, when they have been unsuccessful, historical claims to the ownership of the islands. Already in 1975, Deng Xiaoping told his Vietnamese counterpart that the islands of South China Sea had “belonged to China since ancient times” (p. 202). As demonstrated by Bill Hayton in his excellent book The South China Sea and summarized here by Miller, these historical claims are at best dubious. For most part of its 2000 years of history, the South China Sea was a trading area for the various peoples belonging to shifting kingdoms that occupied the littoral. The Chinese empire was not even active in maritime affairs for most of that period. The claims to the South China Sea started appearing in Chinese maps for the first time in 1914 and these were used as a basis for claims by the Nationalist government and the Communists after that. In 2009, China for the first time submitted a map to the United Nations Commission on the Limits of the Continental Shelf in which appeared a nine-dash line (also known as the ‘cow’s lick’) and exerting “indisputable sovereignty over the islands in the South China Sea and adjacent waters” (p. 206). The Southeast Asian nations were understandably furious. Since then, Chinese actions in the South China Sea have resulted in numerous conflicts with the neighbors. China has blocked oil exploration in the territorial waters of Vietnam, which it claims to itself. There have been naval standoffs and actual shooting incidents between Chinese and Vietnamese and Philippines forces. And China has harassed fishing vessels from other countries that have ventured into disputed waters.

One of the reasons for China claiming virtually all of South China Sea, including the EEZs of the adjacent Southeast Asian nations pertains to the hydrocarbons to be found in the seabed. However, Miller does not believe this to be a major motivation: it is believed that the region contains relatively little oil and gas, and what is there is hard to exploit due to difficult geology and powerful typhoons. The real reason he says is to gain strategic control of the shipping lanes (p. 210). Miller appears to have some sympathy for China’s position, although he recognizes that its position is weakened by its selective adherence to the United Nations Convention on the Law of the Sea (UNCLOS) of which it is part, and its refusal to accept a ruling in 2016 by the Permanent Court of Arbitration in favor of the Philippines regarding the Scarborough Shoal, a triangular group of reefs and rocks off the coast of the Philippines. The events have also led to tensions with other countries, including Japan, Australia and the US. In fact, the American navy destroyer U.S.S. John McCain, which collided with a tanker off Singapore on August 21st, 2017, was returning from a ‘freedom of navigation’ mission in South China Sea sailing through international waters that China claims. This has led Beijing to believe that there is a US-led anti-Chinese coalition being built involving its Southeast Asian neighbors, as well as Japan, Australia and India.

Tom Miller ends his excellent book with a brief but powerful 10-page conclusion that both acknowledges China’s rightful concerns and its need to “start acting like a great power” (p. 239) given the size of its population and economy, as well as recognizes the challenges that the country itself and the region as a whole face. President Xi’s “proactive” foreign policy in Asia, he writes, “offers a straightforward deal: China will deliver trade, investment and other economic goodies to all partners that accommodate – or, at the very least, do not challenge – its core interests” (p. 240). China’s persuasive power comes from the economic incentives it can provide. It faces questions of trust with its Asian neighbors and partners, especially those that have disputes or historical reasons to distrust China. Also in newly democratic countries, like Myanmar and Sri Lanka, where China is associated with support to previous suppressive regimes, there will be challenges.

However, as Miller, states, “the reality is that China will become a much more visible presence in Asia in the coming decades” (p. 242). And as Chinese nationals and firms spread across the region and the world, President Xi has sworn to protect nationals abroad, using military force if necessary (p. 243). These factors risk blowing up in the future. Still, despite a certain militarization, China has thus far emphasized trade, commercial interests and economic growth, rather than political or geographical expansion (notwithstanding its occupation of Tibet and claims to Taiwan as a rogue province). In President Xi’s words: “We Chinese love peace … No matter how much stronger it may become, China will never seek hegemony or expansion” (p. 245). Miller sees China’s determination to gain control of the region as quite rational and something that the US and regional powers must accept. He finishes the book with the following passage (p. 248):

“It is hardly my place to prescribe how the US and China should avoid war. I do believe, however, that the US and its regional allies must accept China’s determination to carve out its own sphere of influence across Asia. And having accepted the inevitability of China’s rise, the safest course of action is to accommodate it within a remodeled regional security structure. Whether China would accept such an accommodation is another question, and much will depend on the relative strengths of both sides in the decades to come. But as China pursues its vision of national rejuvenation, something has to give. If it does not, the “Chinese dream” might tragically morph into an Asian nightmare.”

Tom Miller has written a very fine book on a topic that is one of the most important developments in the world today. His writing is smooth and entertaining, while he combines historical and political analysis with reporting from the frontlines. Everyone interested in security and development in Asia and the world would benefit from reading this book.

References:

Hayton, Bill (2014). The South China Sea: The Struggle for Power in Asia. New Haven and London: Yale University Press.

Kaplan, Robert D. (2015). Asia’s Cauldron: The South China Sea and the End of a Stable Pacific. New York: Random House.

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