[Marxism] China Plans a New Silk Road, but Trade Partners Are Wary
lnp3 at panix.com
Sat Dec 26 07:46:27 MST 2015
(An article that illustrates the folly of seeing geopolitics
NY Times, Dec. 26 2015
China Plans a New Silk Road, but Trade Partners Are Wary
Beijing’s effort to revive ancient trade routes is causing geopolitical
strains, with countries like Turkey increasingly worried about becoming
too dependent on China.
By KEITH BRADSHER
ANKARA, Turkey — As tensions in the Mideast and Ukraine rose in recent
years, Turkey moved to jointly manufacture a sophisticated missile
defense system. The $3.4 billion plan would have given Turkey’s military
more firepower and laid the foundation to start exporting missiles.
But Turkey abruptly abandoned the plan just weeks ago in the face of
strong opposition from its allies in the North Atlantic Treaty Organization.
Their main objection: Turkey’s partner, a state-backed Chinese company.
Western countries feared a loss of military secrets if Chinese
technology were incorporated into Turkey’s air defenses.
As one of its highest economic and foreign policy goals, China has laid
out an extensive vision for close relations with Turkey and dozens of
countries that were loosely connected along the Silk Road more than
1,000 years ago by land and seaborne trade.
But Beijing’s effort to revive ancient trade routes, a plan known as the
Belt and Road Initiative, is causing geopolitical strains, with
countries increasingly worried about becoming too dependent on China.
Kazakhstan has limited Chinese investment and immigration for fear of
being overwhelmed. Kyrgyzstan has pursued warmer relations with Moscow
as a balance to Beijing.
With the missile deal, Turkey was turning toward China partly to reduce
its reliance on NATO. “Our national interest and NATO’s may not be the
same for some actions,” said Ismail Demir, Turkey’s under secretary for
But the deal immediately raised red flags in the West.
Besides the technology issues, the Chinese supplier, the China Precision
Machinery Import-Export Corporation, was the target of Western sanctions
for providing ballistic missile technology to Iran, North Korea,
Pakistan and Syria. So Turkish exports based on a partnership with China
Precision could have also been subject to sanctions.
Complicating matters, China and Russia are close allies on many issues.
Russia is especially distrusted in Turkey because of its military
intervention in Syria and its annexation of Crimea from Ukraine. And
Turkey had been a close American ally ever since it sent a large
contingent of troops to fight North Korea and China during the Korean War.
The Chinese missile project “was one of the things that really made
people say ‘Turkey is shifting, wow,’” said Mehmet Soylemez, an Asian
studies specialist at the Institute for Social and Political Researches,
an independent research group in Ankara. “China wants to remake the
global financial and economic structure.”
With its wealth and markets, China is a tantalizing partner.
Many countries along the former Silk Road are frustrated by the
difficulty of developing closer economic ties to the European Union. And
they are alarmed that the American-led Trans-Pacific Partnership, a
major regional trade deal, could give an edge to Malaysia and Vietnam.
“So many years, we have been kept waiting at the edge of the E.U., and
people are losing hope,” said Sahin Saylik, the general manager of
Kirpart Otomotiv, a large Turkish auto parts manufacturer. “Turkey is
not in the Trans-Pacific Partnership and problems in the Arab world are
pushing Turkey to have other alternatives.”
But the relationship with China is lopsided. Turkey imports $25 billion
a year worth of goods from China, while exporting only $3 billion there.
In Turkey, stores are full of Chinese goods, from vacuum cleaners to
tableware. Chinese companies have purchased coal and marble mines, as
well as a 65 percent stake in Turkey’s third-largest container port.
China is helping build nearly a dozen rail lines, and it is already a
military supplier, selling lower-tech battlefield rockets to Turkey.
Companies are increasingly turning to China for cost reasons, buying
components or importing fully assembled products. Arzum, one of Turkey’s
best-known appliance manufacturers, did the engineering and marketing
for its popular new Okka single-cup Turkish coffee brewers locally. But
the brewers are manufactured in southeastern China.
“Ten years ago, Turkey didn’t exactly see the threat of China for
manufacturing,” said T. Murat Kolbasi, Arzum’s chairman. “The threat has
to be changed to the opportunity.”
Chinese companies can quickly sever ties as well.
The state-controlled China Machinery Engineering Corporation abruptly
backed out of a $384.6 million deal to buy a 75 percent stake in the
electricity grid of Eskisehir and nearby provinces in Turkey. It
happened days after national elections in Turkey last June cast
uncertainty on the future of the industry’s regulations.
China Machinery provided no official reason to the Turkish Electricity
Distribution Company for canceling the deal. The Chinese company
declined to comment.
Turkish Electricity, a nationwide grid company, is suing the Chinese
company in an effort to collect a breakup fee. Mukremin Cepni, chief
executive of Turkish Electricity, said that he had worked 18 months on
the Eskisehir deal and was unenthusiastic about any more tie-ups with China.
“I won’t think well of them, because personally I struggled a lot, and
their going away without giving any reason exhausted us,” said Mr. Cepni.
Ethnic issues have further complicated China’s relations. Many countries
in the region are Muslim, and versions of Turkish are spoken in more
than a dozen countries, partly a legacy of the Ottoman Empire.
That history has fanned regional tensions over Beijing’s stringent
policies toward the Uighurs, Muslims in China’s Xinjiang region who
speak a Turkic language. Beijing has blamed Uighurs for a series of
attacks on Han Chinese from eastern China.
When China suppressed Uighur protests in 2009, Recep Tayyip Erdogan, the
Turkish prime minister at the time, condemned the actions as “a kind of
genocide.” Last July, Turks and Uighurs held two rounds of protests in
Istanbul and Ankara.
Now the president of Turkey, Mr. Erdogan is prioritizing ties with
China. He calmed the anti-Chinese protests last summer by urging his
countrymen to be wary of rumors on social media about China’s treatment
of the Uighurs.
Nationalistic Turkish groups like Anatolia Youth, previously outspoken
about the Uighurs, have responded by softening their stance toward
China. Mahmut Temelli, the chairman of Anatolia Youth’s foreign
relations council, said that he believed that on missiles, “the bid
should have remained with China.”
The missiles became an international issue two years ago, when Turkey’s
defense ministry announced it favored a Chinese bid. It beat out an
American offer to sell fully built Patriot missiles, as well as similar
deals with Western Europe and Russia.
Turkey wanted to churn out missiles, potentially for export in a few
years, and to stop relying on NATO’s occasional deployments of Patriots.
“You cannot protect a 911-kilometer border just with Patriots,” said
Merve Seren, a security specialist at the Foundation for Political,
Economic and Social Research, a pro-government public policy group in
And Turkey’s F-16 fighters, like the two that shot down a Russian
warplane in late November, cannot be on patrol continuously, said Mr.
Demir, the defense under secretary. Missile systems can be ready around
As the Syrian conflict worsened, NATO’s limited supply of Patriot
missiles meant that it sent only enough to protect three Turkish cities.
NATO had begun to withdraw them when the Russian warplane was shot down.
“NATO’s deployment of air defense systems is on and off,” Mr. Demir
said, just hours after the the episode with the Russian warplane, videos
of which played on the television in the background. “I don’t know if it
gives a message that your partners can rely on.”
But Turkey had a huge blind spot with the missile project.
Turkish military analysts compared a long list of variables, like
missile range and the willingness to share technology and manufacturing.
The analysis was approved by a committee including the defense minister,
generals and Mr. Erdogan, Mr. Demir said.
But nobody consulted the foreign ministry on how Turkey’s allies would
react, partly because NATO had already tolerated Greece’s acquisition of
Russian air defense missiles from Cyprus. “They were informed after the
process was completed,” Mr. Demir said. “It was not treated as a special
project that will have a lot of political results.”
Within days of the announcement about China’s leading bid, NATO member
countries organized a campaign to overturn the decision. President
Obama, Western European heads of state and top NATO commanders contacted
NATO officials have been cautious, saying any country has a right to
choose its own equipment. But they have publicly expressed concern that
Chinese missiles might not be compatible with NATO equipment — and
privately that they were loath to share technical details to make
Last month, Turkey opted to go ahead on its own. It will probably
subcontract some components to foreign manufacturers, possibly China
An engraved metal plate from China Precision in a polished rosewood box
still sat on a shelf outside Mr. Demir’s office the morning the Russian
warplane was shot down. Hours of negotiating with Chinese arms makers
has forged a relationship that will make future military cooperation
easier, Mr. Demir said.
“There is a value,” he said, “in the time we have spent with these
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