WINNER TAKE ALL: CHINA’S RACE FOR RESOURCES AND WHAT IT MEANS FOR THE WORLD
By Dambisa Moyo
Basic Books, $26.99
Everywhere I have gone this year, I have encountered China Inc.’s voracious appetite for land and resources. I arrived in Australia in February to find the newspapers denouncing the sale of prime agricultural properties, such as the famous Bobbara Station in New South Wales, to Chinese-government- controlled entities. (For an American equivalent, imagine the Chinese taking over the King Ranch in Texas.)
Next came an April lecture tour of New Zealand, where Chinese corporations have been buying up dairy land. A friend of mine — who happens to be one of New Zealand’s leading developers — assured me that a new law requiring government approval for foreign land purchases over 12 acres would solve the problem. He was flabbergasted when the next China deal — for 20,000 acres of prime dairy land — went through anyway.
Canada in May was all abuzz with news of China’s investment in Alberta’s oil sands. Alberta has the largest proven reserves of oil outside of Saudi Arabia, and PetroChina had just bought out its Canadian partner to become the first state-owned Chinese company to wholly own an oil sands development — a development that 75 percent of Canadians opposed.
These are not isolated events. All over the world, China is snapping up mines, agricultural land and oil fields at a frenetic pace, often paying more — considerably more — than the going rate. The sheer scale of its purchases is astonishing. Over the past six years, China has spent an estimated $400 billion — about $1 billion per week — on direct investment abroad, most of which has gone toward securing commodities.
From my perspective, China’s global buying binge raises serious questions.
If China is determined to deploy the bulk of its large and growing foreign reserves, currently estimated at $3 trillion, in this fashion, it will be well on its way to controlling a significant percentage of key global commodities.
This sudden commodities grab would be disruptive enough if it were done with private capital. But it is not. This spending spree is not just being orchestrated by the Chinese party-state; it is the Chinese party-state, for the most part, acting through its vast network of state-owned and state-controlled corporations.
I am convinced that we need to think long and hard about the security implications of allowing China to corner certain sectors of the commodities market.
A whole host of questions arises: How would China’s leaders behave if they were in a position to set prices for, or restrict access to, various key commodities? Would they restrict access for noneconomic policy ends? How and under what circumstances would they resort to military force to defend those resources, once they have purchased or otherwise asserted control over them?
So it was with great expectations that I sat down to read Dambisa Moyo’s new book, “Winner Take All,” which addresses China’s drive to achieve market dominance in the coming struggle for the world’s resources. I must admit that I came away disappointed.
In Ms. Moyo’s rather jaundiced view, our plundered world is rapidly running out of everything — land, water, energy and minerals — and China cannot be faulted for trying to lock up the lion’s share of what little remains. In fact, she believes: “Of all the world’s great powers, only one, China, has focused its economic and political strategy on anticipating the considerable challenges presented by a resource-scarce future.”
She also believes that China, unlike the United States, is a beneficent presence in the world because it “underwrites schools and hospitals, and pays for infrastructure projects such as roads and railways, catering to the needs of the host nations and making China an altogether more attractive investor than international bodies such as the World Bank, which often tie loans to harsh policy restrictions.”
Page after page of prose describes the Chinese party-state as operating from the purest of economic motives, exculpates China from charges of neocolonialism and pooh-poohs the possibility that China might be tempted to military action in defense of its interests. Whereas the United States intervened in Iraq for its oil — or so she claims — China would never, ever engage in such imperialistic adventures.
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