Business, Finance & Economics

Opinion: How did China get double-digit economic growth?


PALO ALTO — While the rest of the world struggles to pull out of the global recession, China’s economy is galloping ahead at double-digit rates and is threatening to overtake Japan as the world’s second largest.

How did China accomplish that — particularly given that half the nation’s population lives in primitive, impoverished conditions? The average per-capita income is about $2,500, and 35 percent of Chinese don’t even have access to a toilet.

The answer: China eagerly does business with the vilest regimes in the world — nations so reprehensible that a democratic leader would be thrown from office for making even one of these deals. China manages all of this with a foreign-policy conceit that at first seems perfectly benign. As the Foreign Ministry, puts it: “China always adopts a policy of non-interference.”

Actually, this policy has proved to be perfectly pernicious. China chooses not to pass judgment on other nations’ behavior, no matter how dangerous or malevolent a state may be. The non-interference policy also offers a corollary benefit: China says no one has any right to judge how China behaves — even when it hacks and sabotages Google’s email service.

Iran is the case du jour. How more convincing could the case for United Nations sanctions be, given the stolen elections, the execution of demonstrators and the discovery of secret underground nuclear development facilities? Even Russia is on board this time. Like Iran, Moscow does significant business with Tehran and usually opposes tough U.N. sanctions. China is the only holdout.

But Iran is hardly the only example. China is the chief benefactor for Sudan's genocidal leaders. In violation of a U.N. arms embargo, Beijing provides the weapons and ammunition to Sudan that President Omar al-Bashir uses to arm the militias that have slaughtered more than 200,000 people in Darfur and are now reigniting conflict in South Sudan.

China buys half of Sudan's oil exports and has given the regime more than $1 billion in loans that come with low interest — or none at all. All of this for a state that the rest of the world regards as a pariah. Sudan appreciates the business. This week, its United Nations ambassador happily noted that China “has no hidden agenda.” China cares not how many people his government slaughters. Non-interference, remember?

China also remains Burma's most important ally. China buys oil and natural gas from Burma and sells weaponry to the junta. North Korea, Belarus, Zimbabwe, the Congo and Venezuela — China has solicited business, provided generous aid or made deals with all of those states.

But it’s China’s relationship with Iran that is the most public — and galling. Members of the United Nations Security Council are preparing new sanctions against Iran, and last week Secretary of State Hillary Clinton warned China “to recognize the destabilizing effect that a nuclear-armed Iran would have” on the Persian Gulf.

A few days earlier, Chinese Foreign Ministry spokesman Ma Zhaoxu said: “Our consistent proposal has been to resolve the Iran nuclear issue appropriately through dialogue and consultation,” not sanctions. China certainly has been consistent.

In September 2005, soon after Iran admitted it was stepping up its refinement of nuclear fuel and abandoning a two-year freeze, the Security Council began the first talk of sanctions. Chinese Foreign Minister Li Zhaoxing said, “Our position has always been that diplomacy should be the basis” for negotiations, adding that “the Chinese side is working to promote peaceful negotiations and dialogue.” A few months earlier, China agreed to buy 250 million tons of liquefied national gas from Iran over the following 25 years.

In January 2006, Foreign Ministry spokesman Kong Quan said China “hopes that all parties concerned can exercise restraint and resolve through peaceful negotiations.” The next month, Iran announced that it was signing a major oil-export deal with Beijing.

In 2007, when the Security Council began working on a new sanctions resolution, China’s U.N. ambassador, Wang Guangya, warned: “To talk about more sanctions, we have to be careful. Especially for China, we made it clear from the beginning that sanctions should not hurt the Iranian people's daily lives.”

Early the following year, when Iran's oil ministry said it would sign a contract with China’s National Offshore Oil Corp to develop the North Pars gas field, foreign ministry spokesman Liu Jianchao said: “Relevant U.N. Security Council resolutions and actions should be conducive to the resolution” of the nuclear issue “through dialogue and negotiation.”

Now, the Obama administration has given Iran a full year to take up Washington’s offer of “dialogue and negotiation.” and five years has passed since China first proffered its negotiations trope. Iran has consistently refused and instead has grown more pugnacious and dangerous.

Now, China buys 15 percent of its oil from Iran, and when President Barack Obama visited Beijing in November and asked President Hu Jintao about Iran, Hu told him that the way to “appropriately resolve” the issue was through “dialogue and negotiations.”