/ 27 August 2010

Breaking the spell of China

Breaking The Spell Of China

The contradictions were sharpened on front pages this week: President Jacob Zuma reviewing the crisply arrayed ranks of Chinese soldiers — while at home strikers went to the barricades outside schools and hospitals.

Union leaders seized on this perceived reminder of Thabo Mbeki’s preference for globetrotting over sorting out domestic issues and attacked Zuma’s left flank.
Indeed, the absence of the great conciliator during the most urgent crisis of his term suggests to many that he is unconcerned about running the country, or even balancing forces in the fractured coalition that gave him power.

That is too simplistic. Relations with China are clearly crucial to South Africa’s foreign policy and meetings with Chinese Premier Wen Jiabao and President Hu Jintao cannot be lightly cancelled. But Zuma’s visit also underscores the ANC government’s fascination with China and its development model, which is now finding clearer expression.

Mbeki and his team, ambivalent about China’s growing influence in Africa but impressed by Beijing’s ability to direct growth and offset Western power, enthused about the “Beijing consensus” — British journalist Will Hutton’s term for the state-led development approach seen as replacing the liberal Washington consensus.

To talk to senior government officials about their “developmental state” approach after 2004 was to hear them enthuse about China, not Japan or Germany, whose Rhineland model offers different lessons in worker/capital/government cooperation.

They had travelled on ANC or government delegations to China and marvelled — it is impossible not to — at the scale on which its leaders get things done, particularly the civil works that have been the special genius of the Chinese for more than 5000 years. ANC officials are now attending “political schools” in Beijing to imbibe more of this elixir.

But there are huge differences between the Chinese experience and ours, not least on the question of democracy. The Chinese state preserves the social “harmony”, which it views as crucial to development, by tightly controlling dissent.

The All-China Federation of Trade Unions, for example, is effectively an arm of the state. It is now under some pressure to become less pliant to ensure legitimacy, particularly with increasingly assertive workers in the coastal manufacturing belt, but it is not about to attack Wen publicly or call state workers out on strike.

Communist party leaders know that safety valves for discontent over high healthcare costs, or land seizures by politically connected developers, are needed, but that does not mean sanctioning an independent civil society sector.

A further point that South African policymakers miss — China’s long economic boom has been fuelled by the opening up of its markets. The state has tried to set the pace and control the spread of development, moving from the private sector-powered east coast manufacturing nodes to the infrastructure-based drive to open up the rural hinterland under the slogan “develop the West”. But the boom has been driven by the unleashing of massive economic potential — not state direction.

Of greater relevance is Zuma’s previous Asian host, India, whose turbulent democracy is a dramatically upscaled version of our own and which has also reaped massive economic growth through greater openness.

There the Congress Party, which has much deeper historical associations with the ANC, must sell its reforms to fractious coalition partners, state governments, business and popular movements. It must deal with independent courts, a vibrant press and millions of literate voters.

The real business of Zuma’s trip, of course, is business, specifically the channelling of some of China’s massive savings surplus to South Africa, and this is where the government’s approach is now clearer.

Getting on equal terms in trade is a lost cause. Even if the books are balanced, our export of raw materials and import of manufactured goods puts us at the losing end of the value equation. That is why all talk of a free-trade deal has been dropped.

Salve for this wound comes in the form of Chinese investment, particularly in industrial capacity and infrastructure. And we will repay it with support for the geopolitical rebalancing under way at major multilateral institutions, not least the United Nations, the World Trade Organisation and the International Monetary Fund.

South Africa cannot punch with China by any objective measure but its influence in these bodies is still valuable. It is simply canny diplomacy to expect something in return.

But we don’t need to fawn over China’s economic and political model to benefit from its successes. When Zuma gets home it will be time to stop dreaming of bullet trains and un­contested five-year plans and work on the messy business of democratic governance.