Is China the World’s New Colonial Power?

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Is China the World’s New Colonial Power?

The rising superpower has built up enormous holdings in poor,
resource-rich African countries — but its business partners there
aren’t always thrilled.

By BROOK LARMER, MAY 2, 2017, NY Times

[ . . . ]
Nearly 88 percent of China’s energy now comes from fossil fuels, only
1 percent from nuclear power. (Solar, wind and hydropower account for
the remaining 11 percent.) To reach its clean-energy goals — and shed
the ignominious title of world’s biggest producer of greenhouse gases
— China has put nuclear power back on an almost impossibly fast track.
The country now has 37 nuclear reactors, with another 20 under
construction, and it aims to have 110 reactors by 2030. (Beyond that,
the goal is to become an exporter of nuclear-reactor technology. China
has already built six reactors overseas, and last month, Swakop
Uranium, a C.G.N. subsidiary, submitted a proposal to construct a
reactor in Namibia.)

This rate of growth, six new plants each year, would catapult China
past the United States as the world’s top nuclear power, but it also
raises concerns. In January, an American consultant to C.G.N. pleaded
guilty to charges that he conspired to illegally recruit United States
nuclear engineers to help accelerate the design and manufacture of
C.G.N. reactor components. Critics at home and abroad also question
whether China’s safety standards can keep pace with the new reactors.
One Chinese physicist, He Zuoxiu, even told The Guardian that the plan
is “insane.”

C.G.N. did not allow me to visit the mine or interview its managers,
claiming that they were too busy increasing production. To get a
glimpse of the vast complex, I drove down a dusty back road to the
highland plain where the Welwitschia mirabilis grow, near Husab’s back
gate. Before construction began at Husab in 2013, the company
transplanted four rare Welwitschia specimens that would have been
destroyed in the blasts — a symbolic gesture in a country that reveres
the ancient plant. Since then, C.G.N. has seemed eager to dispel the
uncaring reputation that Chinese state-owned companies have earned: It
has made donations to drought victims, offered scholarships to local
engineering students and, in a first for a Chinese company in Namibia,
even invited a local labor union to set up shop at the mine site.

Independent unions are essentially illegal in China. And the Metal and
Allied Namibian Workers Union had waged a campaign against Chinese
state-owned companies, accusing some of paying Namibian workers only
one-third of the minimum wage and others of using armies of Chinese
workers for unskilled jobs that by law should go to Namibians. So when
C.G.N. invited the union’s secretary general, Justina Jonas, to China
for the mine’s inaugural event, she was skeptical. “The Chinese will
promise you heaven,” she told me, “but the implementation can be
hell.” Jonas threatened not to go to China if Husab didn’t sign a
project labor agreement protecting workers’ wages, hours and safety.
Just days before the trip, C.G.N. signed the agreement, a first for a
Chinese company.

For all its public outreach, Husab still operates in a self-contained
Chinese universe. Chinese managers often schedule key meetings for the
weekend, when it’s convenient for them to review and plan — but also
when Namibian colleagues are not present, according to local
employees. Local workers marvel at how, when a non-Chinese part breaks
down, Chinese engineers will sometimes send the specs home so Chinese
companies can reverse-engineer replacement parts at a fraction of the
cost. This looks different from a Chinese perspective: Just as the
mine offers young engineers an opportunity to hone their expertise in
vital new jobs, it also gives Chinese companies a chance to show that
they can make high-quality vehicles and equipment — at a third of the
cost of top foreign brands. Husab still makes companies go through
testing and bidding, but as one worker put it: “We have to help and
support our brother companies. It’s all part of the ‘going out’
policy.”

Mining is hardly China’s only interest in Namibia. The land is too
arid to sustain the kinds of vast agricultural projects underway in
Mozambique and Brazil. But China’s state-owned construction companies
are burning up their excess capacity building Namibian highways and
ports, a Chinese embassy compound and a new military academy in
Okahandja. Military relations are close, too. China trains Namibian
officers — an echo of its 1960s assistance to Swapo — and supplies
weapons. In April, the United States intervened to stop Namibia from
paying $12 million to Poly Technologies, a subsidiary of a Chinese
company on the American sanctions list for selling banned weapons to
Iran, Syria and North Korea. It was a reminder that the United States
is still in the background, warily watching China’s incursion into
Africa.

Husab is a tangible, direct investment, but most Chinese projects in
Namibia and around the world are financed by soft loans that carry
risks. Last year, China established a new $60 billion fund to finance
infrastructure projects in Africa, mostly with Chinese lending. The
easy money is alluring, and the projects can be essential. But most of
the loans stipulate that a Chinese state-owned company must take the
lead, ensuring that the work, skills and profits are kept largely in
the Chinese family. Countries like Namibia are left holding the debt.
Schlettwein, the finance minister, told me, “I don’t think those are
real investments, but opportunities latched onto by Chinese
enterprises without really adding value to the Namibian economy.”

Such criticism irritates Chinese business owners and diplomats, who
point out that Chinese companies have invested more than $5 billion in
Namibia and now employ more than 6,000 Namibians. “We’re here to do
business on an equal footing with the locals,” says Xia Lili, the
former diplomat who is deputy general manager of Jack Huang’s Sun
Investment Group and secretary general of the Namibia-China Loving
Heart Organization. “We bring in money to establish mines and
factories. Who benefits? The Namibians. Did the Western powers ever do
this? Not nearly as much. So this talk of new colonialism is untrue.”

Namibia, though, is starting to push back. Last year the government
pulled out of a $570 million loan agreement with a state-owned Chinese
company to expand the Windhoek airport. Then in September, as sluggish
growth and other foreign loans pushed Namibia’s debt to over 40
percent of its G.D.P., the government suspended all new loan tenders.
Schlettwein says the freeze was a prudent act of belt-tightening, not
a move specifically targeting China. Nevertheless, he says: “It sends
out a signal that Namibian interests are not to be trampled on
indiscriminately. It sends a signal that our relationship must
mature.”

One morning in late December, the Namibian conservation biologist
Chris Brown was working alone in his Windhoek office when he heard a
banging at the gate. Rushing out, he found two angry Chinese men in
button-down shirts: the first and second secretaries from the Chinese
Embassy. One of them threw a crumpled letter through the gate, Brown
says, and shouted: “These are lies! You are making China look bad in
the eyes of the world!”

The pages were the same ones Brown hand-delivered to the Chinese
Embassy two days before — and then sent to other diplomatic missions,
media outlets and international organizations. Signed by 45 local
environmental groups, including Brown’s own Namibian Chamber of
Environment, the letter blamed Chinese nationals for a sharp surge in
the commercial poaching of wildlife in Namibia — and excoriated the
embassy for doing little to stop it.

Over the last two years, Namibia has lost nearly 200 elephants and
endangered rhinos to poaching. In November, a Chinese smuggler was
caught in the Johannesburg airport with 18 rhino horns — all from
Namibia. Two months earlier, four Chinese men were sentenced to 14
years in prison for trying to smuggle out 14 rhino horns in 2014.
(Rhino-horn powder is an ingredient in traditional Chinese medicine
that is believed to strengthen the immune system.) Brown had meant the
letter to provoke a response, but this visit was unexpected.

“You are abusing China’s good nature,” one of the diplomats said, in a
raised voice, according to Brown. “Only a handful of Chinese have been
involved in poaching.”

“No, Chinese demand is driving all of this,” Brown replied. “I think
you are trying to strip all of our resources for China.” When the
yelling subsided, Brown says, he invited the men inside. Sitting in
his conference room, they leafed through binders filled with
photographs of slaughtered rhinos and elephants. “They got quieter and
quieter,” Brown recalls. A few days later, he met with the Chinese
ambassador, who cautioned him against letting a few “rotten apples”
tarnish the entire Chinese community. Brown again insisted it was a
more systemic problem. “Listen, we can ratchet up the pressure and
make things even worse for you,” he says he argued. “Or we can come
together to solve this problem.” The ambassador, he says, agreed to
join the antipoaching fight.

One of the most troubling dimensions of China’s global expansion is
its reputation for pillaging and pilfering the natural world. China is
not the only culprit in the $19 billion illegal wildlife trade. But
its growing hunger for the rare, exotic and dubiously curative is
devastating worldwide populations of rhinos and elephants, sharks and
tigers — and spurring illegal timber operations in rain forests
stretching from Congo to Cambodia. Huang Hongxiang, a former
journalist from China who investigated ivory and rhino-horn poaching
in Namibia, has started a Kenya-based nonprofit organization, China
House, to help Chinese companies and communities engage in wildlife
conservation as a form of corporate social responsibility. “In a lot
of global environmental issues, Chinese are part of the problem,” he
says, “so they have to be part of the solution.”

Poaching is a scourge in Damaraland, an arid region of rocky
outcroppings in northwest Namibia. “Locals are enticed into killing
rhinos by the China market,” my Namibian guide, Taffy, who tracks
elephants and rhinos, told me. “The horns always seem to end up in
Chinese hands.” In the past, conservation issues were mostly
championed by white Namibians. That is changing. “Blacks used to think
whites cared more about the animals than them,” says Shinovene
Immanuel, a reporter at The Namibian. “But now that poaching has
gotten out of hand, everybody is upset.”

Public anger is also rising over some Chinese business proposals that
could do damage to the environment. One Chinese-owned company has
sought to clear-cut part of Namibia’s only pristine forest, in the
Zambezi region, to create a tobacco plantation nearly double the size
of Manhattan, despite the fact that the area’s sandy soil is
unsuitable. Another Chinese business wants to set up donkey abattoirs
to meet China’s soaring demand for donkey meat and skin (the latter is
considered a curative in Chinese medicine). And a Namibia-based
Chinese company filed a request last fall to capture killer whales,
penguins, dolphins and sharks in Namibian waters — all to sell to
aquatic theme parks in China. Local activists protested for weeks
until the Chinese firm withdrew its proposal.

Three months after Brown’s letter provoked the indignant response, the
Chinese Embassy hosted a much more diplomatic meeting of Namibian
activists and some 60 Chinese business leaders. Besides trumpeting
China’s recent ban on all ivory sales — and airing an antipoaching
video featuring the basketball star Yao Ming — the acting ambassador,
Li Nan, denounced poaching and lectured Chinese nationals about
obeying Namibian law. Li told me in an email that, at Brown’s
invitation, he will visit the rhinos’ habitat in northern Namibia this
month. The two countries, he said, are also working to form a joint
law-enforcement task force to combat transnational wildlife criminals.

Jack Huang also spoke out against poaching, but a different kind of
dragnet was closing around him. On Feb. 1, the tycoon and four others
(three of them Chinese) were arrested at Windhoek’s international
airport for their participation in a supposed tax-fraud scheme that
netted nearly $300 million — the largest case in Namibian history. The
arrests were part of a two-year investigation into more than 30
Chinese companies accused of concealing illegal earnings. While in
custody, Huang reportedly tried to contact President Geingob, but his
business partner refused to help. “When my ‘friend’ was arrested and
spent a night in jail, there was no interference or intervention,”
Geingob told a local paper later. “This is because in Namibia, we
uphold the rule of law, the separation of powers, and pride ourselves
on the total independence of our judiciary.”

Huang, the man with all the connections, now finds himself
disconnected. In mid-February, soon after his release on $75,000 bail,
he claimed that the tax-fraud case against him was based on outdated
information. Xia, his deputy at Sun Investment, told me that Huang
actually divested from Golden Phoenix, a company named in the case,
more than eight years ago, but that the transaction had not been
entered into the official computer system. When this trial is over,
Huang may file lawsuits against those who attacked his businesses, Xia
says. In the meantime, the gregarious entrepreneur will probably spend
more time dining alone. When he invited an old friend out to dinner
recently, he was gently rebuffed — the power broker was suddenly a
pariah.

Arresting a high-flying Chinese businessman may be a simple matter of
law, but it is also one more sign of how the relationship between
Namibia and China is being recalibrated. Li Nan wrote to me that he
believes that the boisterous local press is “trying to whip up racist
sentiments and hatred.” The animosity in Namibia, though, is nowhere
near the levels that have caused explosive riots at a Chinese coal
mine in Zambia, including one in 2012 that left a Chinese manager
dead, or that sparked unruly protests against Chinese traders in
Kampala, Uganda, last month. (The rising resentment toward the Chinese
in Uganda recalls another era, when the dictator Idi Amin expelled an
earlier wave of immigrant merchants, from the Indian diaspora, in
1972.)

Still, the new tensions between China and Namibia are laid bare at
police checkpoints around the country, where Chinese nationals are
routinely singled out for inspection. The police say this new policy
has already exposed several cases of wildlife smuggling. Jack Huang’s
associate, Xia, was pulled over at the checkpoint on the airport road
last month. The police frisked him, combed through his luggage and
scoured his car. “All the while they were yelling, ‘Rhino horn, rhino
horn, where’s the rhino horn?’?” Xia recalls. “I was shocked that this
could happen in Namibia. This is a country that is supposed to be our
all-weather friend.”

As the afternoon sun weakens over the Husab Uranium Mine, most of the
2,000 or so Namibian workers return to their desert barracks. Teng and
the other Chinese engineers board buses for the ride back through the
moonscape to Swakopmund and the little house on Amathila Avenue. After
sharing another Chinese meal together, the men disperse. Teng walks
back to his apartment, where he will spend a few hours on his computer
doing administrative and supervisory tasks. “Our real secret,” Teng
says, “is that we work 12-hour days while everybody else works eight.”

It’s a chilly Saturday in April — the antipodal winter is coming — and
Teng has worked overtime again. He has missed one of the only
diversions here: Saturday-afternoon basketball games at the local
sports center. (China now has so many state-owned companies in Namibia
that they stage an annual 15-team championship; China Harbour
Engineering, the port builder in Walvis Bay, won this year.) Strolling
on the Swakopmund waterfront, Teng was no longer clad in his khaki
mining uniform. Wearing jeans and a Quiksilver T-shirt and cradling a
cappuccino, he looked like any tourist gazing out over the crashing
Atlantic surf. During his nearly four years here, Teng has not had too
many chances to be a tourist, though he took advantage of a recent
holiday to go on a wildlife tour in Etosha National Park.

In their bubble at Husab, Teng and his colleagues are mostly insulated
from the tensions between China and Namibia. These huge Chinese
projects all over the developing world can seem like spaceships
landing on distant planets. Chinese workers often have little
incentive — or latitude — to venture out into the alien environment,
especially when the state-owned mother ship provides food, lodging and
transport. And the exhausting work can sap them of all curiosity about
their surroundings. On a plane back to China in April, I sat next to a
worker who had just spent two years in Equatorial Guinea — but had no
idea where it was.

The tech-savvy Teng, by contrast, can pinpoint his exact location on
Google Earth, even though his routine is largely circumscribed by the
43-mile route between Husab and Swakopmund. Saving more in Namibia
than he could back in China — thanks, in part, to all those free meals
on Amathila Avenue — Teng has built a tidy nest egg. In 2014, when a
C.G.N. delegation from China visited Husab, Teng chatted with one of
the two women in the group. Online flirting ensued. In January, Teng
stunned his Husab colleagues when he returned from a trip to China
with a ring on his finger. He’d married the visitor — mission
accomplished — joining a handful of others who had done the same
thing. Teng’s other goal has not yet been achieved. He wants to see
Husab reach its full potential next year, fueling China’s continued
rise. “This is an important thing for China, ” he says, “and I want to
be a part of it.”

The Chinese migrants who have gone out into the world, the risk-takers
who have found spots in Asia, Latin America and Africa, are as diverse
as China itself: young and middle-aged, unschooled and highly
educated, working for private companies and state-owned enterprises —
and even for themselves. They are not a monolith. And yet, in these
far-off places, they are connected to one another in a way that they
never could be back home in a land of 1.4 billion people. It’s not
just the shared food, culture or language — or the solidarity that
comes from being thrown together in a harsh environment. What binds
these individuals together is an abiding belief that their presence
overseas is making China better and stronger. This shared conviction,
as much as the state that has nurtured it, is what makes China a
colossus, a nation that can be seen by others, in the same instant, as
a blessing and a curse.

https://www.nytimes.com/2017/05/02/magazine/is-china-the-worlds-new-colonial-power.html