Tag Archives: China’s rise

All aboard: Kunming-Vientiane Railway inches forward

china train head

Although a bit trite with repetition, no saying better encapsulates the major obstacle facing Laos than “geography is destiny”. The only landlocked country in Southeast Asia, Laos is wedged between the vast rivers and expansive mountain ranges that demarcate its natural borders with China, Vietnam, Cambodia, Myanmar and Thailand. Because of its lack of access to maritime trade routes, the small country has historically relied heavily on domestic subsistence agriculture with little opportunity for much international commerce.

The legacy of its geography in combination with the destruction wrought by the United States during the Vietnam War has today resulted in a nation with some of the world’s highest poverty and unemployment rates. With the help of the Chinese and Thai governments, Laos hopes to change this narrative of international isolation in the years to come.

Since 2010, plans have been under consideration to construct a high-speed railway between Kunming and Vientiane, Laos’ capital. However, political and financial setbacks have pushed the starting date of the project back by five years. This year, the three governments all sound confident that construction of the seven billion dollar project will begin.

Many analysts now view the construction of the Kunming-Vientiane railway within the context of China’s larger ambitions to revamp trade routes throughout Southeast Asia. China’s president Xi Jinping has openly stated his eagerness to establish silk road-esque connections with China’s neighbors, placing Kunming at the epicenter of overland transactions. The country has already invested 40 billion dollars to facilitate railway links, which it hopes will eventually drive new economic plans throughout South Asia.

Already, long-term proposals have been hashed out to eventually link Kunming with Singapore. The first phase in the series of projects is currently under construction, with China building a 737-kilometer connection between the Thai city of Nong Khai — just across the Mekong River from Vientiane — and Map Ta Phut — one of the largest deep water ports in Thailand.

The planned Kunming-Vientiane rail then, would add on to existing railroad infrastructure, facilitating a larger Kunming-Bangkok route by — according to recent estimates — no later than 2020. A link to Malaysia would from there be relatively simple. If all goes as projected, passengers may, within the next decade, be able to hop onto a high speed rail from Kunming all the way to Singapore.

Past financial qualms that have plagued the realization of the Vientiane-Kunming proposal continue to worry politicians in both China and Laos. Although a fairly small investment for China, the seven billion dollar price tag corresponds to over 60 percent of Laos’ US$11.24 billion gross domestic product, making it a hefty and risky endeavor. Currently, the two countries have agreed on a 40-60 split of the initial financing, with Laos contributing US$840 million and China US$1.26 billion. The remaining five billion will later be chipped in by Chinese venture capital firms, who would then hold substantial stakes in the railway once it is up and running.

Although worries over the pragmatic utilization of the railway have previously stymied Laos’ cooperation with Chinese entrepreneurs, increasingly Lao politicians believe the connection to Yunnan’s capital is paramount for their country’s economic growth. In an interview with Japanese magazine Nikkei, Laos’ deputy prime minister, Somsavat Lengsavad, explained that Laos, being a landlocked country, can only rely on roads, so the transport cost is very high. “In our policy of turning Laos from a landlocked to a land-linked country, we believe the railroad will help us reach our objective. [The railway] will boost the Lao economy because many investors are now looking for a production base here. They say that if the country had a railway, it would help them reduce their transportation costs. So it would make us more attractive to investors.”

Recently, the country has proven itself one in an appealing group of potential manufacturing centers in Southeast Asia as overseas companies flee China. Over the past few years, Laos has ridden a growing wave of economic growth, with annual GDP often topping eight percent. Such financial development has been attributed primarily to the construction of massive 1,000-megawatt hydroelectric dam complexes, growing highway infrastructure and multibillion-dollar investors betting on long term prosperity in the region.

Politicians, including Lengsavad, remain sanguine that the fiscal expansion will only be further boosted by a direct link to Yunnan. Already, companies including Samsung and Yahoo have left China to venture into smaller, burgeoning financial systems. Laos hopes the Vientiane-Kunming connection will enable it to hop onto the train of foreign investment out of China.

Skeptics, including Lao politicians, point out that the real construction cost of the Kunming-Vientiane route may soon render the project another white-elephant. Without a doubt, both financially and topographically, much stands in the way of the railway’s establishment. An astounding 154 bridges, 76 tunnels and 31 train stations will be necessary for the Lao leg of the track. The monumental proposals stands in stark contrast to Laos’ nearly complete lack of experience with railway construction. The land-locked country currently boasts only of a 3,5-kilometer train link, spanning the Thai-Lao Friendship Bridge.

To make matters more complicated, the Annamite mountain range, which the railway will eventually need to cross, is infamous as a minefield littered with unexploded American ordnance dropped during the Vietnam War. These factors combined are likely to result in a final cost for the track much greater than the projected seven billion dollar price tag. Laos thus finds itself stuck between a rock and a hard place — on one hand it desperately needs infrastructure for greater commerce, while on the other, current proposals may leave the country in an even more precarious financial situation than it currently faces.

This article was written by Richard Diehl Martinez and first posted here on GoKunming.

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Filed under ASEAN, China, Current Events, Foreign policy, GMS, Laos, Mekong River, Regional Relations, SLIDER, Thailand, Trade, Yunnan Province

China’s Humanitarian Policy in the Philippines: Politics Over People?

Image courtesy Bruce Reyes-Chow

Image courtesy Bruce Reyes-Chow

China has been no stranger to territorial conflict throughout its long and complex history, having met plenty of resistance while spreading its dynamic culture near and far. Today is no different, as intense disputes over tiny island chains in the South and East China Seas have left China in a state of particularly poor relations with some of its most important neighbors. These disputes, of course, do not bode well for maintaining reasonable terms over some of the region’s most important geopolitical issues. However, what has become equally as apparent—and potentially more important—is the way these conflicts are currently affecting the way China conducts humanitarian policies in the region. As China continues to rise toward the top of global power and influence, many assert that with it comes a rising role of global responsibility. What we have found thus far is that China does not appear interested in taking up that challenge.

After Typhoon Haiyan—an exceptionally powerful storm—roared through Southeast Asia in early November and devastated parts of the Philippines, leaving the country’s death toll at over 6,000, China surprised the global community by offering a meager $100,000 in humanitarian aid. This, compared to the tens of millions of dollars in aid offered by many of the world’s most powerful countries, was perceived as particularly frugal and, to some, downright disrespectful. Understandably, China received quite a bit of backlash for its decision and soon thereafter increased its contribution to $1.6 million and committed state medical resources to the areas of the Philippines most affected by the disaster. However, China’s initial contribution seemed to clearly define its true opinion on the issue.

Despite China’s late arrival to the hard-hit Philippines, its aid and assistance was, of course, still received warmly and excitedly by the victims. When a natural disaster afflicts a nation, political relations no longer seem to matter to many. Filipino residents greatly embraced China’s support. Gina Tubigon expressed her appreciation after China’s arrival ensured the survival of her sister-in-law, Elesea. A 75-year-old suffering from a chronic respiratory ailment that worsened in the wake of the typhoon, Elesea may not have lived through the storm’s aftermath had it not been for the assistance of the Chinese medical team. Relieved about her sister-in-law’s stabilized condition, Gina expressed her appreciation, noting, “I know the relationship between the Philippines and China is not good, but we’re very thankful for the help.” This purely honest and non-politically calculated sentiment sums up the importance of cooperative relations between the two nations. It also suggests the possibility that a lack of increased aid and assistance from the Chinese government may have caused Gina to lose her sister-in-law.

 Relations between the two countries have been tumultuous for some time. As China continues its unprecedented rise, with an increasingly strong military accompanying extraordinary economic development, its Southeast Asian neighbors have become more and more anxious about territorial integrity. As China’s claims to the region become more extensive, the Philippines has been bolstering its defense and maritime law enforcement—with the help of US support—and has sought endorsements from ASEAN during the process. The Philippines, just like many of its regional neighbors, has endorsed the US’s recent pivot to Asia, as a mechanism to balance against Beijing’s increased maritime objectives.

These exhaustive disputes have occurred between the two countries for decades, but have become further amplified in recent years, as China’s claim to maritime territory off the coast of the Philippines—the 200 nautical mile radius that makes up its Exclusive Economic Zone (EEZ)—has continued to expand. This includes a tiny rock called the Scarborough Shoal, which is no bigger that the size of a relatively small raft, yet vital to the two countries, as it holds important designation for charting territorial boundaries. The dispute between the two countries serves as a microcosm for a more general trend of tension and insecurity that has existed between China and its neighbors further south.

Though these tensions have persisted for many years, amplified to greater extents during certain periods more so than others, they have ceased to have a highly significant or long-term impact on trade relations in the region. Yet, China’s frugal initial response to Haiyan relief reflected a new realm of implications—that these strained relations are having a negative impact on how China is handling its humanitarian policy in the region. As the countries of East Asia continue developing economically, their regional interdependence grows in import. They must be prepared to support one another in combatting natural international crises that extend beyond politics, such as typhoons of the magnitude of Haiyan, especially when these crises have potential for mutually severe impact on multiple countries in the region.

China’s interest in extended control and influence over the region of the South China Sea—and East China Sea as well—has caused many to ponder whether Beijing also plans to embrace a wider role of responsibility regarding international crises. By offering such a small amount of financial aid during the immediate aftermath of this horrific storm, Beijing has implied that—at least for the time being—national interests remain the focal point of its current objectives, clearly trumping the need to be an international leader.

Of course, China’s stance toward the Haiyan relief effort is certainly not simple—with a range of complex considerations likely at play throughout the decision-making process. One fundamental question posed in response to China’s position is whether China is currently choosing not to emphasize the importance of more intimate relations with its neighbors—and the international community more generally—in order to instead commit more focus inward. As the Chinese government creates very carefully calculated strategies regarding domestic economic growth and infrastructural development, large numbers of financial resources and assets are presently committed to various projects throughout the country.

Indeed, China’s current national economic milieu is one of many different parts. These parts include initiatives such as western economic expansion, raising the standard of living for larger populations, developing the nation’s energy sector in a push for cleaner sources of fuel to drive the country’s future development, further establishing modern industries throughout different parts of the country (i.e. financial, technological, and creative/cultural sectors)—and many others. In addition, unprecedented economic progress has also instigated a range of complex social strains, some of which have never before been seen. Actively seeking to deal with these increasingly pronounced issues, such as frustration with appallingly high levels of pollution, larger interest in individual freedoms and self-expression among Chinese citizens, and rapidly evolving national identity—to list only a few—the Chinese government is carefully undertaking its national strategy.

As China consciously addresses these economic and social factors, simultaneous emphasis on non-political/economic international issues may not be on the immediate agenda. National leadership may currently ascertain that, still in an infant state of modern global importance and influence, this complex and highly dynamic country is not in a position to fully involve itself financially and logistically in these types of crises. However, regardless of China’s strategy with respect to regional and international stability—which at this point can only be speculated—what is clear is that China’s highly active position in geopolitical affairs has caused its western counterparts to expect a greater level of support from the rising giant towards these types of crises. Most important will be how China responds to this increased level of pressure and expected responsibility from its global economic partners as similar issues come about into the future.

Nevertheless, in the case of Haiyan, this is only but one event in the midst of a lengthy modern history of strained relations between these two countries that has fluctuated in degree over the years. Therefore, only time will tell if China’s increasingly powerful international role will cause the economic powerhouse to engage the international community differently into the future. In the meantime, the aid and assistance that China did eventually provide to the Haiyan relief effort was effective and surely prevented many from severe illness or death. The victims of the storm as well as those on the medical relief team were not considering regional political tensions as lives were saved. This kind of understanding and expectation will hopefully be at the core of decision-making between China and its Southeast Asian neighbors into the future, as a rapidly changing world seeks to prioritize people over politics.


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Filed under China, Current Events, Foreign policy, Philippines, Regional Relations, SLIDER, South China Seas