Today some many publications and books indicate that whoever controls 5G, who controls not who participates, whoever will control 5G will control communication for the future. The importance of this becomes visible when a "non-Chinese" is going to do business in China. The point to keep in mind is that more than with a company or companies you are doing business with the Chinese Communist Party, which will always put its political perspective ahead.
by JULIO A. CIRINO
A REFERENCE FRAMEWORK
The sixth plenary session (since 1945) of the CENTRAL COMMITTEE of the Chinese Communist Party was inaugurated on Monday, November 8 (2021) and will serve as a framework for China's entry into what they call "a new era" in which, in addition, in the form Xi Jinping is becoming increasingly explicit, at least for now, as the new Emperor of China. To make sense of what is happening these days, it is prudent to analyze the historical-political framework in which this event takes place and how it may affect our hemisphere.
Perhaps the best way to characterize Latin America's growing relationship with the People's Republic of China (PRC) is to call it “the silent advance”, in other words, there are no Chinese troops landing in the region, there are no multitudes of Chinese citizens arriving. these lands, I would say that it is a constant advance but little visible to the untrained eye
What is the focus and how does this advance work? In the first place, it should be noted that the advance is presented to the viewer as an issue linked to economic growth and must be immediately linked to an internationally known Chinese project that is already in its years (it was presented to the world back in 2013) and that has been growing silently, in English it is known as “Belt and Road” and in Spanish as “La Franja y la Ruta” a project that covers “lands and seas” and that marks the passage of China from a country retracted on itself to a country that takes up the line of the Chinese Empire.
This requires us to go back a little to History because it is History that helps us understand these processes. One of the most outstanding characteristics of China in its Imperial era (remember that China, before the arrival of the Communist Party was an Empire) presided over by the "Emperor of China" who was, among his people called the "Son of Heaven "And the Son of Heaven exercised dominion and control (at least in theory) over the" tianxia "which was all that space that was under the" celestial vault ". This thought in current terms leads to the idea that we speak of "planet earth" and that is that in theory the Emperor of China, the "Son of Heaven" is the one who ruled all that space that was under the celestial vault.
This is the historical reference that comes from centuries ago. Now if we jump to the moment when the so-called Cultural Revolution (Mao) takes place where the figure of the Emperor of China falls and the Chinese Communist Party (CCP) at that time led by Mao Tse Tung goes on to conceive a "different country" for some decades closed in on himself or at most concerning his neighbors, until today where the successive changes in the regime converge in the character that is most representing the return to the imperial vision of China, but of the 21st century and that undoubtedly, is Xi Jinping
Xi somehow embodies a modern version of the emperor of China and let's pay attention that there is practically no area of the earth where China does not have at least some presence in mind. We are certainly not signaling a claim to world domination but rather the growth of a "superpower."
It can be replicated that the United States also grew as a "superpower" but then we should analyze under what political philosophy the United States grew as a Republic and under what political philosophy does the Chinese Empire grow today.
So it is necessary to understand this vision of the universe to later understand what is happening regionally in Latin America, but which also concerns practically all of Southeast Asia, all of Europe, Africa and should concern the countries of Latin America a little more.
COMMERCE TECHNOLOGY AND POLICY
We are going to reflect on how we characterize this regional policy in China and what its characteristics are:
As a starting point,
let us point out the issue of the expansion of economic policies, which are also technological;
(which does not imply forgetting that China is making very important efforts to become a nuclear-military superpower)
let us note that the discussion that has been taking place in the last year on the subject of communication systems generally known as 5 G that are the most modern communication systems and where there is an open fight between the United States, the European Union, and China
to see who advances more, who advances faster and who controls that because whoever achieved the maximum acceptance and expansion will control nothing more and nothing less than the way the world communicates today.
It is also necessary to highlight that China, an essentially "land" power, now has one of the most important commercial fleets in the world, with a navy that is currently the second in capacity and the first in the number of operational ships.
But returning to the subject of communication, which seems routine to us, it is not a minor thing because if you think with a historical criterion from the time when to communicate from point A to point B you had to send a ship or a ship. messenger, to today, wherein seconds we are communicating with almost any point of the planet we will have an idea of what the perspective of communications is regarding the commercial issue. If, on the contrary, we approach it from a political angle we will see that Xi Jinping has that geopolitical vision that takes it or "takes it back" from the imperial vision of China carried into the 21st century.
That imperial vision of China is the vision of the "emperor of China" who controls or in some way rules the rest of the planet; This does not imply saying that China is going to "invade" the rest of the planet, but rather that it points to a geostrategic vision that is taking on different characteristics in different parts of the globe.
The strip and route project that was presented back in 2013 today practically covers at least 99% of the countries in the region in Latin America. It obviously and visibly has a commercial implication, a technological and communications implication, and a less visible geo-economic implication, so I think this can be a starting point to start our analysis.
Take into account this vision of China as imperial and not as it was once considered a minor power, as something not very relevant or worthy of attention.
We point this out simply as the frame of reference to which we will return as we proceed with our analysis.
Let's see a cold data, the growth of China in the world of trade between 2000 and 2019 grew from 1.1% of world trade to 12.4 this gives a magnitude of what China is a commercial power.
In the case of Latin America from Mexico to "Tierra del Fuego" (we do not involve the United States and Canada in this comment) in the last 5 years, it experienced a significant global economic deterioration, which is not homogeneous throughout the region. Added to this was the problem generated by COVID, which persists, which opened a series of opportunities for China to increase its influence in the area.
Simultaneously there is a visible retraction of the interest of the United States and I am referring to the political, economic, and strategic interest concerning Latin America.
This is a reality that does not need to be discussed much because cold numbers indicate the growth of one and the withdrawal of the other without even considering what is visible in terms of political withdrawal, with which the image of a country is visible. ,
The United States, disinterested in Latin America and the other advancing.
Let's see how this progress is and why it is important, we pointed out above, that it is not a matter of "military occupation" but rather putting the focus on a "tripod": it is undoubtedly technology, corruption, and finally political relationship economical.
Because it is in the development of technologies where there is an open competition to which we have already referred due to the technological advances that are taking place in very different areas, particularly in the area linked to communication. Corruption because we remember that a few years ago the United States approved or the United States Parliament approved legislation known in English as the “Foreign Corruption Act” or International Corruption Act that soon after all the countries of the European Union approved. This is relevant because unlike what happened 25 years ago at this time that Foreign Corruption Act applied in the European Union and the United States makes that if a company of this origin from both the European Union and the United States paid or Receiving money from corruption is subject to criminal penalties under current legislation.
However, China does not replicate this legislation, so it can handle certain operations with significant economic advantages. As with the so-called “tax havens”.
This overtime brought China economic/commercial advantages, particularly in dealing with countries outside the European Union. I think it is an element to take into consideration even if not much is said about it.
We have already pointed out that the figure of Xi Jinping is in the year 2021 the same figure of the Emperor of China and this is important in terms of competitiveness because in many countries the “commercial” legislation has to pass through the parliaments and sometimes they pass quickly to sometimes they go slow and sometimes they don't pass then from the point of view of international money management.
This gives China a capacity that no western country can match, it is simply not possible, we are talking about 2 different dimensions;
Now when we get into this, as it usually happens, we have to pay a price and the price is that, undoubtedly, doing business with China is much more advantageous in terms of profit, but it always has the political collateral.
All activity does not matter if it is technological, economic, social or whatever falls under the control of or the leadership of the PCC.
It is worth pausing for a moment on the issue of investments, in the West, a business must meet the requirement of being viable and legal, but it is a private business between the parties involved, the big difference is that in China there is no purely private business. There are Chinese companies that operate all over the world and that are recognized by all, but the subject demands a brief comment. In the framework of the Chinese political system, private business, as we understand it, does not exist.
We must consider two elements of judgment, the first element is known that every company of any importance has a board of directors, however,
in the Chinese system you cannot be a member of the board of directors of a company if you are not first a member of the Chinese Communist Party.
Imagine that for a moment in the United States or Europe that an entrepreneur was told that he cannot be a member of the board of directors of a company if he is not previously a member of this or that party.
To this is added that he does not join the Chinese Communist Party without a process that implies first presenting himself as a “candidate” for a member and after submitting to the “analysis” of the party, it resolves its acceptance or not; it is for that reason that only a relatively small percentage of China's vast population are members of the Communist Party. To this is added that, in all companies, there must be members in the board of directors who officially represent the Chinese Communist Party, with which you have a double representation of the Party, first because, as we have pointed out, the members of the board of directors "must" be members of the party and second. because members of the Chinese Communist Party who are in different positions in the highest company, the lowest become members of the board as formal representatives of the party.
The importance of this becomes visible when a "non-Chinese" is going to do business in that country because business in China is very advantageous. The point to keep in mind is that more than with a company or companies you are doing business with the Chinese Communist Party, which will always put its political perspective ahead. and this is normally a topic that is discussed among specialists and does not usually appear on the covers of newspapers, but this is the reality in which we are moving and that it should be kept in mind.
Another point to note is the development by China of what is normally called dual-use infrastructure, there is usually a lot of emphasis on China's technological contribution to the region, now well within that infrastructure there are infrastructure that has "harmless" connotations But when we begin to talk about developments that are considered dual-use, it means development that has two components, a technological component and a component that may or may not is linked to the defense and (strategic) security of a country, one of the most common examples. Obvious is the aforementioned 5G communications system that, as we highlight, is being established throughout the planet.
Today some many publications and books indicate that whoever controls 5G, I say who controls not who participates, whoever will control 5G will control communication for the future. Precisely the idea is that no one controls the 5G and that there are multitudes of companies that compete with each other, European, Asian, Latin American companies, each with its interests, each with its accent in an area.
Now, in the ideal Chinese scheme, the trend that is sought in this area of literature is that everything related to telecommunications more specifically 5G remains in the hands of companies of Chinese origin. An argument that we have heard is that there are "different" Chinese companies, then there is plurality and it happens that all those Chinese companies when you analyze the pyramid of control of the company it turns out that at the top of the pyramid is the Chinese Communist Party in such a way that plurality and competition as we understand it is absent.
More than once I heard the question ... well then what you are saying is that Latin America does not have to do business with China ... by no means what we are pointing out is the convenience of knowing with whom you do business and how you do it. Then when a business or deal with China is the most advantageous for the country, I carry it forward and if I do not look for alternatives, the inconveniences arise when I have a single supplier of a certain technology because the situation occurs that whoever exercises that control ends up also having the political control particularly when we are talking about sophisticated technologies.
What is noted regionally is that particularly in the last three years it is visible that the increase in China's presence both in relatively simple areas such as the ports area to those more sophisticated as we were mentioning the area of communications and not only of the 5 G but of satellite communications and of all kinds of communications that today are and this must be taken into account, those that make business possible, commercial exchanges.
FINAL REFLECTION
It is surprising to the untrained eye the speed with which this technological time is advancing today, it is such that if politics (and the same "political philosophy) cannot keep up, that country may find itself in a situation of being tied or a technology that ends up "depending." That is why the secret of "smart" countries is in that sense the plurality that has a lot to do with freedom. Saying plurality and freedom usually go hand in hand, at least this is what we think.
One last idea to close this comment. China is solidly established in our region and acquired a political-economic impact unthinkable a few years ago. It is consolidated in various areas that we already mentioned synthetically, but it is also consolidated in four points of the geography where it has been established in
“geoeconomic” terms:
Venezuela,
Nicaragua,
Cuba, and
Suriname in four points today.
China has a strong presence that also It serves as a "springboard" for the rest of the hemisphere and from the point of view of a hemisphere that tries to maintain a free economic system and a political system.
This is an issue that will be worth observing carefully ...
About the Author
Julio Cirino, Fellow
Risk evaluation and complex situation analysis. Specialized in politics interaction.