/ 9 September 2011

Tales of the springbok and the dragon

It seemed like a Herman Charles Bosman story that had crawled through a wormhole and done some acid. In this version, the Groot Marico had become the Klein Karoo and Oom Schalk Lourens’s voorkamer had morphed into a desert bar called Ronnie’s Sex Shop and Road Kill Café, with a local flight instructor standing in for Krisjan Lemmer — except the flight instructor was not yarning about leopards, but about a recent Chinese invasion of Oudtshoorn.

“We’re training them to fly in small groups,” the flight instructor told me, as we sipped brandies under a ceiling of donated lingerie, adding, “by the time we’re done, we will have trained 400. The Chinese are planning a massive expansion in local aeronautic capacity; 700 new domestic airports, apparently.”

It seemed a stretch, even in the circumstances, but a few phone calls later and Willie Meyer of Cape Flying Services cagily admitted, “the details you’re telling me are not untrue.”

Now, you’d think the small matter of 400 Chinese learning to fly in South Africa’s ostrich capital would figure somewhere in the Chinese embassy’s purview, but it hasn’t heard of the programme. It’s a blind spot that demonstrates two important things about Sino-South Africa relations: First, the gobsmacking scale of the interactions that are tracked (such as Chinese metals producer Jinchuan’s recent $1.35-billion offer to buy South African miner Metorex). Second, the fact that there are now too many fronts to the China-South Africa relationship for even the famously efficient Chinese to keep track of.

The explosion of interaction between the two countries also means an explosion of policy challenges, however, as Sisa Ngombane, Asia and Middle East deputy director general at the department of international relations and co-operation (Dirco), explains.

‘The way the Chinese work is complex for us. You have national leaders coming, parastatal delegations, provincial delegations, business delegations. It’s not what our people are used to. It’s very easy to get bogged down with mere protocol and to lose sight of the core benefit we’re seeking from a particular engagement,” he says.

He tells me the Chinese have the ability to “put forward their national interest very strongly in their approach to issues, especially when it comes to trade matters”.

But is South Africa as clear about what it wants from the relationship?

Human resources
Two recent trade muddles bear out Ngombane’s concern that South Africa, with nothing near the human resources of the Chinese government, is perhaps not in a position to do so.

Take this early 2010 example, when the Chinese government imposed a ban on South African wool exports after an outbreak in the Free State and Northern Cape of Rift Valley Fever, a mosquito-borne virus that can and does kill livestock and humans.

At the time, wool producers implored the department of agriculture, forestry and fisheries to inform its Chinese counterpart that Rift Valley Fever does not communicate through wool. They even had the World Organisation for Animal Health send a letter to the Chinese government explaining this.

For months, the issue remained inert. The Chinese continued to insist that their strict requirements be met, leaving South African vets no choice but to withhold their signatures from export certificates. The exasperating impasse led the former head of animal health at the agriculture department, Dr Dewald Keet, to imply a measure of spite on the part of the Chinese.

“A few years ago, the Chinese wanted to import racing pigeons to Sun City, but South Africa has yet to formulate import requirements. It was my view that this and other trade hold ups, played a part in the wool ban,” Keet says.

Childish tit-for-tat is not unknown in international trade relations, but an industry insider suggested a far likelier cause: “Raw wool gets treated as an agricultural product and, as such, does not fall within the department of trade and industry’s mandate. Within the department of agriculture there doesn’t seem to be a trade desk, so restoring trade with China has effectively fallen to the veterinary department. I know for a fact it doesn’t see itself as a restorer of trade, rather as an inspectorate, and it doesn’t actually make any difference to it whether trade gets restored or not.”

The source argues that a dedicated trade desk in the agriculture department could have acted more forcefully in the national interest. But it didn’t and the cost to the wool industry has been immense.

“Nobody wants to tout figures at this stage, but people are saying the impact has been massive. Business costs — mainly thanks to increased storage costs — have increased fivefold, but the biggest concern is the opportunity cost for this season coming. There’s so much uncertainty around the tradeability of the wool that Chinese buyers are looking elsewhere,” says Louis de Beer, general manager of Cape Wools SA.

Of course, there have been times when the South African government has put the national interest firmly on the table, most notably in 2007, when it pressured the Chinese government to impose a quota on Chinese clothing and textile exports, which had been sweeping away the local industry. The quota was set to persist for two years, with a view to allowing the South African industry, which, at the time, was shedding 15 000-16 000 jobs a month, space to beef up its competitiveness.

A diplomatic victory, it would seem, although Etienne Vlok of the South African Institute of Labour Relations says that getting China to agree to cap clothing and textile exports had less to do with the rhetoric of friendship, understanding and mutual respect being spouted by Chinese and South African politicians at the time than the fact that, “the United States and the European Union had won the right to impose similar protective trade measures through the World Trade Organisation, and China did not want South Africa to set a similar precedent for the developing world and so agreed to work something out bilaterally”.

The policy was widely deemed a failure. The Chinese government, says Wei Jiang, economic counsellor at the Chinese Embassy in Pretoria, warned its counterparts it would fail, precisely for the reasons it believes it did.

“South Africans continued to consume foreign goods, but at higher prices, and nothing happened in South African industry, nothing improved, it remained very poor,” Jiang says. It’s a polite way of saying the policy was flawed, a position taken by several prominent South African economists.

Local industry leaders contend that the policy’s logic was sound, but that it was poorly implemented.

According to Vlok: “The plan called for industrial measures to be implemented alongside the trade measures, but government did not implement these industrial measures until three-quarters of the way through the quota period.”

In one sense, it hardly matters whether the source of the problem was the policy’s design or its implementation; either way, the South African government is seen as having failed to deal with a problem of Chinese provenance.

Has it dealt with it since?

Vlok says the department of trade and industry has implemented all the industrial measures in the original plan and praises its reaction time to industry problems. Still, a long-term strategic vision for dealing with China seems to be lacking.

“I don’t get a clear sense that we have a ten to fifteen-year strategy for engaging with them,” says Peter Draper, a political science research associate at the University of Pretoria, who formerly headed the Asia desk at the DTI. “Decisions tend to be made more on the hoof, responding largely to the concerns of domestic constituencies and not really driven by China itself.”

That foreign policy decisions should directly address pressing domestic concerns such as unemployment is a hallmark of South African foreign policy under President Jacob Zuma. It’s a noble directive, but one which, if lazily interpreted, might lead again and again to knee-jerk protectionism rather than bold imaginative policies that look outwards and into the future. In assessing the prospects for a truly engaged China strategy one must first consider the following communication shortfalls.

According to Ngombane, the South African government does not have a single Mandarin speaker capable of providing translation services to South African delegations.

“We have teachers who come in and give lessons, but we are still underperforming; we are not aggressive enough,” he says. “The example to look at is Mauritius, a small country, but very accomplished in languages. They are training a lot of people in Mandarin and other languages, preparing to attract the bulk of Asian trade. To be honest, we have not attended to these things.”

Just as problematic is the fact that South Africa’s provinces and municipalities enter into their own relationships with Chinese provinces, almost always without conferring with government.

“A number of incidents have been reported where huge delegations from municipalities and provincial government, including from very poor areas, rocked up in foreign lands without anyone knowing, at the same time as national-government visits,” says Dr Siphamandla Zondi of the Institute for Global Dialogue, pointing out that this has the potential to cast South Africa as “a disorganised and unco-ordinated federal state”.

Ngombane says this problem applies broadly, but it is particularly dangerous in relation to the Chinese.

“With all due respect, provinces are not well enough resourced to deal with their Chinese counterparts, which have a lot of muscle and a lot of leeway in enacting foreign policy,” he says. “The more the relationship with China increases in scale, the more this issue of provinces dealing with Chinese delegations could really be a problem.”

But isn’t it already a major problem? I’m reminded of last year’s Agrimark conference in Pretoria, at which one speaker after another warned the audience of the coming tsunami of Chinese business and explained how best to prepare for it. The last speaker, a Chinese South African of several generations by the name of Lynette Chen, the chief executive of the Nepad Business Foundation, felt compelled to explain, in the flattened vowels of the Highveld: “I’m sorry to say this ladies and gentlemen, but the Chinese are already here.”

Her point is an obvious but critical one: South Africans need to stop treating China as some sort of terra incognita, or speculative boon, and start focusing on the nitty gritty of a relationship already in full swing.

To bookend with Bosman: the literary world he created, the Groot Marico, was a place of rustic folk, queer in their habits, rather entertaining to be around, but ultimately inept and eternally severed from real power and influence. One wonders whether Chinese diplomats, in incomprehensible Mandarin asides, don’t depict South Africa in much the same way.

Sean Christie is the Mail & Guardian’s Open Society fellow in foreign policy reporting.