THE subtext to the extravagant Belt and Road summit last week is clear: there is a new sheriff in town, he is not American and a lot less imperious. In the age of Brexit and Trump, the timing of China’s grandiose flexing of economic might – articulated through its conscious rediscovery of a glorious past when silk was gold – could not be more opportune for its purposes. As the rest of the world watches the West’s old standard bearers of internationalism grapple with domestic waves of populist protectionism, China is proposing to the developing world its alternative sphere of influence, under which we are told we may reap economic rewards.
Yet, even as the collective recites the new favourite phrase “win-win cooperation”, it must concede to the wisdom of an older Western adage which teaches that usually, “there is no such thing as a free lunch”. The planned forays spanning from Jakarta to Rotterdam, if completed to fruition, will redraw the global trading and geopolitical map at a scale unseen in generations, into one which puts China firmly in the driving seat of a new age of globalisation. That in itself ought to be food for thought for all countries. For one, as susceptible to external trends as Malaysia is, a full understanding of what China is really after and a considered set of measures to best position ourselves is even more essential.
Hence, as we watch closely at precisely how and when the Belt and Road initiative on paper translates to actual ventures, we ought to pick up tell-tale signs of where the physical meets the intangible; of where cold and hard economism is supplanted by China’s nebulous sense of her rightful place in the world. The signs indicate a new China aiming for something a lot more than transactional trade and business deals, lucrative as these are. Conversely, we see a country bent on building both hard and soft powers in a self-reinforcing march to global superpower status.
Some of these signs are contained in the US$10bil a year spent on such soft power projects, including funding Confucius Institutes in 140 countries teaching language classes and Chinese cooking, sponsoring Chinese New Year events overseas, investing in foreign language media and building stadiums for African football teams. To put China’s recent image-building blitz into perspective, consider that in 2014, under an infinitely more outward-looking President than the present one, the US budget for “public diplomacy” was US$670mil.
So what does Malaysia do in the face of such a tantalising prospect of hundreds of billions in inward investments? For better or worse, we are an open economy, and hence, the first order principle must always be that of encouragement. But as foreshadowed above, bear in mind that these billions will come from a country aspiring to greater global influencing capacity, and with whom we have not insignificant territorial disputes. Hence, even as we welcome China with open arms, we ought to strengthen our hand and keep an eye on long term economic goals that pre-existed the unveiling of the Belt and Road initiative.
Tangibly, this means ensuring that Malaysian firms get more than just a quick buck through low margin construction subcontracts or jumping on gravy train JV setups where all technologies and R&D capabilities remain locked within Chinese counterparts. It also means that, while in the immediate infrastructure projects represent the road to belt along to achieve provisional investment and GDP aims, for the long run we must already strategise such that China’s newfound generosity may also be of use in developing indigenous capabilities in high value added activities including in industries already earmarked in our New Economic Model like green technology, petrochemicals and Islamic finance. Let our desired outcomes drive how China fits into the picture of our making, not the other way round. All this will require careful analyses and hard work to convince and entice. But for a win-win situation to prevail, we must sometimes dictate the terms of partnership.
For some countries, taking anything and everything they can get from China may be the right thing to do. Not for us. In some ways, we are in a more precarious position than those lower on the development ladder because we simply do not have the luxury of settling for incremental improvements as we go along.
Rather, we are forced to be strategic in the extreme about skills we enhance and sub-sectors we develop to eventually lift us into the premier league of economies, which is the Prime Minister’s stated goal for our new national vision of TN50. In the face of a new unknown Santa Claus, be not mesmerised. As our competitors continue to roll on at greater pace with ever higher proportions of skilled labour and productivity growth rates, just a few years of meandering and pandering only to short term milestones will cost us dear.
Umno Youth executive committee member
TN50 Youth Ambassador