China’s Domestic Counterterrorism May Fail Against Global Jihadis

‘RESTIVE’ IS THE adjective favoured in the popular prints to qualify Xinjiang. President Xi Jinping’s call for the far western autonomous region to be surrounded by a ‘great wall of iron’ suggests the presence of a greater threat.

As does Cheng Guoping, state commissioner for counterterrorism and security.

He says that the Uighur separatists that comprise the East Turkestan Independence Movement are the China’s ‘most prominent challenge to social stability economic development and national security’.

Xi and Cheng’s comments follow the most recent show of force in Xinjiang’s capital Urumqi and other cities such as Kashgar, involving some 10,000 paramilitary police with accompanying armoured vehicles and attack helicopters.

China has been fighting a sporadic and low-level civil war with Uighur separatists for decades that on occasion erupts into deadly terrorist attacks across China. These attacks, usually involving a car bomb or knifings, have become more frequent, dispersed and indiscriminate since 2012, though the number, as far as can be determined, is small.

A May 2014 attack in Urumqi killed 43 and wounded 90. The province simmers with unrest as the now minority Muslim population bristles under what it considers to be culturally and religiously repressive government by ethnic Han Chinese.  Yet there is little on the surface to suggest that the local threat level has suddenly escalated to the degree these actions and Xi and Cheng’s comments would imply.

However, Beijing now sees external as well as internal threat. That is challenging its notions of how to deal with ‘terrorists’.

Three recent videos, purportedly made by the Islamic State group and an al-Qaeda affiliate, raise the spectre that China could import the radical Islamic extremism that it has so far avoided. Beijing has long used the bogeyman of radical connections between Xinjiang separatists outside and the Muslim Uighur minority within to exert repressive domestic control.

The 30-minute video that surfaced in February, in particular, gives some weight, at last, to those warnings. It shows Uighurs training in Iran and threatening that blood would ‘flow in rivers’ in China — although also in Russia and the United States.

There are well-documented reports of Uighurs having gone to Afghanistan, Syria and Iraq to fight for radical Islamic groups. The numbers of Chinese ones — 100-150 on the estimates we have seen — scarcely seem to justify the extraordinary reaction of authorities, although one of the Islamic State videos includes what is thought to be the first instance of Uighur-speakers declaring allegiance to Islamic State and its self-proclaimed caliphate.

One question is whether Beijing’s fears are overblown and its response proportionate; another is whether it can adapt a counterterrorism approach developed in response to domestic concerns to international terrorism.

China, unlike the United States and Russia, has little by way of a military footprint in West Asia thanks to its profession of non-interference in the affairs of other countries. It is not involved in either the US or Russian/Iranian-led actions against Islamic State in Syria or Iraq, the usual prerequisite of Islamic State acts of terror against a country.

A hostage taking and killing in 2015 is the sole known case involving targeting a Chinese citizen, although seven Chinese were among the 20 killed in a bomb attack on Bangkok’s Erawan Shrine and three Chinese citizens were among the 27 who died during an attack on the Radisson Blu Hotel in Mali’s capital, Bamako, both the same year.

However, China’s growing global footprint and expatriate labour force, and especially the expansion of ‘One Belt, One Road’ across Eurasia, makes it almost inevitable that it would eventually be unable to avoid coming into harm’s way from international jihad.

As we noted recently, China and Afghanistan share a short border through which the forces Beijing so fears could enter the country directly. China border-police controls are keeping it under close surveillance in the event that, as Islamic State loses territory in Syria and Iraq, the group falls back to being an insurgent guerrilla force and its leaders and others of global jihadist movements relocate to Central Asia and Afghanistan, far too close to China for Beijing’s liking.

However, the capacity of Islamic State to coordinate and stage large-scale attacks inside China will be limited. Furthermore, Beijing’s already-fierce repression in Xinjiang and tight censorship everywhere mitigates the caliphate’s strategy of inspiring lone wolves and affiliated terror groups through a radicalising narrative of domestic marginalisation of Muslim minorities.

This has had some success in Europe and the United States, but beyond the difficulty in having the message penetrate the Great Firewall, disaffected Muslim minorities do not exist in China in the widespread urban pockets they do in, say, France, Belgium and Germany.

Hitherto, China has dealt with the threat of domestic terrorism, which it considers one and the same as separatism and extremism, with a three-pronged strategy: enhancing regional economic growth; stronger internal security; and strict controls over ethnic and religious activities. All have been heavily applied in Xinjiang with the additional factor of ethnic Han inward migration.

Beijing’s likely response to the new external threat that it sees to its emerging core national interests will be to crack down even harder on the one place it knows there are a lot of Muslims. Already law regulates and constricts religious practices and public life in Xinjiang, such as growing beards, wearing the veil and fasting during Ramadan — all symbols, the authorities say of “Islamic extremism” (like in the US, ‘Muslim’ and ‘terrorist’ will quickly become conflated).

Since last year Xinjiang residents who have a passport are required to turn it into local police, to whom they must reapply for its return if they want to travel abroad. There were reports last year of another Muslim minority, Kazakhs living in border districts of Xinjiang, being told to give DNA samples and fingerprints when applying for travel documents. Uighurs who speak in favour of greater political freedoms risk imprisonment.

These measures are likely to be both more tightly enforced and extended, in the name of “maintaining social control” in the resource-rich western marches that give onto the key overland routes through Central Asia to the Middle East and Europe.

However, the One Belt, One Road dimension and the need to protect the growing numbers of Chinese citizens abroad is evolving Beijing’ security interests. Its responses will have to follow suit. It has been exchanging information on Islamic State with the United States, with which it also cooperates on technical matters to counter terrorism such as port security and anti-money laundering.  (Whether and how that will continue with the Trump administration remains to be seen.)

China has also been talking to Pakistan and the Afghan government about ways to promote stability in Afghanistan, and within the Shanghai Cooperation Organization’s Regional Anti-Terrorism initiative. More controversially, it has also pushed for groups it considers to be terrorist to be added to international and national terrorist watch lists.

Beijing slowly recognises that many of the terrorism challenges that it faces have roots beyond its borders and thus will need it to participate in international counterterrorism efforts. However, its has so far shown that it prefers bilateral attempts to apply its three-pronged strategy with economic, policing and security aid to other countries, but that at best has to be done at arm’s length or get China involved in the internal affairs of countries in ways that run counter to its non-interference doctrine.

As it tries to figure that out, its instinctive reaction will still be to over-react at home by doing more of what it knows how.

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Beijing’s Pyongyang Puzzle

IT IS UNUSUAL for Beijing to make public what has previously been a private suggestion that the United States stops its annual two-month military exercises with South Korea in exchange for North Korea halting its nuclear and missile programmes.

It is a trade-off that Washington and Seoul have equally publicly rejected, to no one’s very great surprise. But it indicates a growing sense of urgency on Beijing’s part about the situation on the Korean peninsula especially given the policy vacuums in both Washington and Seoul caused by the new Trump administration and the expected imminent impeachment of President Park Geun-hye respectively.

Pyongyang has said that the four missiles it launched earlier this week were a test strike against US bases in Japan. Provocative language. The same day, the first components of the THAAD missile defence system arrived in South Korea — a deployment seen similarly provocatively in Pyongyang but also in Beijing.

Beijing’s denial of reports of retaliatory pressure on South Korean businesses convinces few.

Meanwhile, the shadow of February’s fatal attack on North Korean leader Kim Jong-un’s half-brother, Kim Jong-nam, at Kuala Lumpur airport continues to fall widely. If, as is widely suspected, it was a North Korean hit, and one involving chemical weapons,  then the Trump administration may move to reverse President George W Bush’s 2008 delisting of Pyongyang as a state sponsor of terrorism.

That, in turn, would dash the hopes of the likely next government of South Korea that the Trump administration may be more willing to enter dialogue with North Korea. On the campaign trail, candidate Donald Trump had said he would be prepared to meet Kim Jong-un, though he has not repeated the offer as president.

The next South Korean government, whoever leads it, it likely to return to the ‘sunshine’ policy of greater engagement with North Korea than the current scandal-embroiled one.

Some evidence is now emerging that the Obama administration was quietly taking a harder line against the North than appeared on the the surface, cyberhacking North Korean missile launches last year, with some success, in retaliation for the believed North Korean hacking of Sony Pictures in 2014. 

However, the Trump administration, in the absence of a better shaped policy, has mainly fallen back on browbeating China to do more to rein in its neighbour, a capacity it may not have, or at least to the degree Washington believes. For its part, China, under whose protection Kim Jong-nam had lived in Macau and Beijing, is hopeful that diplomacy can replace stand-off and the unsettling uncertainty that goes with it.

Last month, it suspended coal imports from North Korea until the end of this year, a hefty blow to North Korea’s revenue as it accounts for two-fifths of the country’s export earnings, and the toughest sanctions China has imposed to date. Beijing had previously been using a ‘living-standards’ loophole in the UN sanctions against North Korea to sustain the coal trade despite its formal adherence to them.

That it has now changed its stance on this indicates both the frustration of many Chinese officials at what looks like an increasingly anachronistic ally in Pyongyang and their impotence to do more.

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OECD Edges Up China Growth Forecasts

THE OECD HAS raised its forecast for China’s GDP growth this year by one-tenth of a percentage point from the 6.4% forecast it made last November. It has also raised its 2018 projection by one-fifth of a percentage point, to 6.3%. The 2017 forecast puts it squarely in line with the new official target of ‘about 6.5%’.

Its nutshell summary is:

Growth in China is expected to edge down further by 2018 as the economy manages a number of necessary transitions, including shifting towards consumption and services, adjustment in several heavy industries, working off excess housing supply and ensuring credit developments are sustainable. Demand is being supported by very expansionary fiscal policy, including via policy banks, which in turn is boosting private investment and trade. Producer price inflation has picked up strongly, but consumer price inflation remains low.

The OECD also notes that the rapid growth of private-sector credit and the relatively high level of indebtedness by historic norms is a key risk. Non-financial companies’ high debt levels provide particular vulnerability to a rapid rise in interest rates or unfavourable demand developments, it says. The report also advocates spending be directed at health and education and directed away from adding to financial risks.

The significant uncertainty about the future direction of trade policy globally is a key theme in the report, which makes the self-evident point that a roll-back of existing trade openness would be costly. Around one in seven jobs in China is linked to participation in global value chains.

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Li Lays Out China’s Economic Goals For The Year

CHINA HAS SET its growth target for this year at ‘around 6.5%’, prime minister Li Keqiang told the annual session of parliament. That is down from 2016’s goal of 6.5%-7% and the outcome of 6.7%.

The glide path to slower but more sustainable growth continues. However, it will be a more cautious approach this year ahead of an important party plenum later this year at which the scope of President Xi Jinping’s second term and eventually succession will be set.

China also faces a more uncertain external environment economy than any time since the 2008 global financial crisis, while the stimulus that staved off deflation last year has left the debt crisis still to be dealt with. While China is perfectly able to deal with that on a macro level, signs of local stress are increasingly apparent.  The finance ministry has again just warned of the ‘the hidden-debt risks of local governments’, especially in the rust belt in the Northeast.

Li’s signalled that the leadership considered 6.5% growth a floor, though if there is any suggestion of social or political instability (and especially instability within the political elites), that floor will, no doubt, be lowered.

Last year, 726,000 workers were shifted out of rust-belt industries; this year another 500,000 will follow, according to the labour minister. China created more than 13 million new jobs last year, according to the official figures, but a further half a million redundant iron and steel workers and coal miners is a lot to absorb, and especially in places where few new industries are flourishing.

Removing excess capacity from heavy industry has proved more difficult than planned as has killing off ‘zombie’ state-owned enterprises.

Rebalancing the economy has also progressed more slowly than Xi laid out when he assumed the leadership four years ago; one reason is that he has repeatedly turned to old-school stimulus whenever the economy looked to be slowing too rapidly.

The government will have work to do to reduce last year’s fiscal deficit of 3.8% of GDP to the wished-for 3.0% (which was also last year’s target).

Li set another ‘about’ target, of ‘about 12%’ for broadest measure of money supply (M2). While that is less than 2016’s target 13%, it is still above end-2016  money supply growth of 11.3%. More monetary policy tightening is likely, barring severe adverse external headwinds.

The military budget will again be restricted to a 7% increase (1.3% of GDP), even though US President Donald Trump has promised a 10% hike in the United States’ defence budget. The United States spends 3.3% of its GDP on defence.

Beijing’s holding fast after decades of double-digit growth will increase the already sizeable spending gap, $600-plus billion a year against $140 billion a year, though off-budget procurement could add a further $50 billion to China’s number and the modernisation of the PLA will continue.

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China and Afghanistan Draw Closer On The Roof Of The World

 

wakhan_corridor

CHINA’S BOUNDARY WITH Afghanistan is short; less than 100 kilometres arcing around the end of the Wakhan Corridor, a high mountain valley, seen above, on the ‘roof of the world’ that once provide a narrow imperial buffer between the Russian and British empires. Today it separates Tajikistan to the north and Pakistan to the south and looks on maps like a panhandle of Afghanistan whose territory it is.

Though it is an ancient trade route, spilling into Xinjiang through the Wakhjir Pass, it has long been closed at the Chinese end for fear of the drugs, Uighur separatists or other extremists that might flow through it.

Beijing and Kabul have a 2015 border policing agreement that involves joint patrols, but of late there have been reports that Chinese forces have been operating on the Afghan side of the border.

Map showing location of Wakhan Corridor in AfghanistanThis is a remote part of the world, so supporting accounts are scant. The Defense Ministry has confirmed that counter-terrorism and anti-cross-border crime operations have occurred but has dismissed Central Asian and Indian reports of Chinese military vehicles patrolling inside Afghanistan.

Pictures published last November show what look like Chinese-made armoured patrol vehicles inside the Wakhan Corridor. While the vehicles can be made out, what cannot is who is driving them — PLA soldiers, Chinese armed police, Chinese private security firm personnel, or someone else altogether, such as Afghanistan border police.

Relations between the two countries have been gradually growing closer since the establishment of Afghanistan’s National Unity government in 2014.

Afghanistan has agreed not to provide sanctuary for the East Turkestan Islamic Movement, the Uighur separatist group that has been fighting a long and sporadic war for Xinjiang’s independence. For its part, China is training Afghan police and supplying the force with equipment and has pledged $70 billion in military aid as the policing relationship expanded to the defence side (though this hasn’t yet extended to heavy weapons). Bilateral exchanges on both fronts are increasing.

None of this is yet any substitute for Afghanistan’s dependence on the West. However, for Beijing, always worried about insecurity on its Western marches, a close relationship with Kabul will also be essential to the success of One Belt One Road, especially if security concerns about the China-Pakistan Economic Corridor worsen.

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China Makes A Bigger Bang In Arms Dealing

THESE ARE RICH times for the arms trade. The Stockholm International Peace Research Institute (SIPRI) notes that transfers of major weapons in 2012–16 reached their highest volume for any five-year period since the end of the Cold War. (SIPRI uses five-year periods to smooth out annual fluctuations which can be marked in the arms trade.)

China is a leading player in the international arms trade, and one increasingly able to decrease its dependence on imports thanks to a growing domestic arms industry.

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This also makes China a frontline arms exporter, with estimated annual sales of just shy of $3 billion going to 44 countries, particularly to elsewhere in Asia (Pakistan, Bangladesh and Myanmar especially) and to Africa. China’s share of global arms exports rose to 6.2% from 3.8% between 2007–11 and 2012–16.

It is now firmly a top-tier supplier, in third place in the global rankings, moving ahead of France and Germany, though still a long way behind Russia and the United States, which have nearly four and more than five times the sales respectively.

China’s arms manufacturers still face significant quality issues in international markets, though that is improving at the cheaper end. However, IHS Jane’s reported two C-705 missiles failing to hit their targets during a large-scale Indonesia navy exercise in the Java Sea last September 14. In Cameroon, one of four Harbin Z-9 attack helicopters sold to it by China crashed soon after being handed over, bringing a halt to any further sales.

China is also poor at after-sales service and maintenance. Nor has it yet established a globally competitive arms brand in the same class as the US’s Lockheed Martin. China’s biggest arms maker is China North Industries Corp. (Norinco), but its strategy seems to be targeting developing economies with a sales pitch that boils down to near-Western quality but at a fraction of the price.

Chinese arms makers also remain dependent on key components, such aircraft engines, imported from abroad, notably from Russia, Ukraine and France. It also imports key weapons and large transport aircraft, helicopters, vehicles and ships.

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China Gives North Korea The Coal’d Shoulder

OUR MAN IN Munich, where those who make their living from discussing global security were gathered of late, sends word that foreign minister Wang Yi said there that the cycle of sanctions and missile tests has to stop and North Korea and the United States should return to the negotiating table.

Whether that would be as part of a resumption of the six-party talks or a bilateral meeting was unclear, but Wang said Beijing was ready to play the role of mediator, which leaves either interpretation open.

Yet in the meantime, China is suspending all imports of coal from North Korea until the end of this year. This is as close to compliance with UN sanctions against Pyongyang’s nuclear weapons programme that one can get. China is North Korea’s primary export market and coal is its biggest single export.

Last week, China was believed to have turned back from Wenzhou a $1 million shipment of  North Korean coal the day after North Korea had tested an intermediate-range ballistic missile in defiance of UN Security Council resolutions banning the country from carrying out such actions.

Suspending imports is the latest tightening by China as coal exports are what Pyongyang relies on to generate cash, particularly since China stopped importing some precious metals almost a year ago and banned the sale of fuel in the opposite direction. North Korean coal exports to China rose more than 12% last year, coming in through a loophole in the UN sanctions that allows imports on which North Koreans depend for their livelihood.

The mysterious death of North Korean leader Kim Jong Un’s half-brother Kim Jong Nam by apparent poisoning, if proved to be connected to North Korea as suspected, may have also tested Beijing’s patience beyond endurance.

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