Operation Mekong: China Tightens Grip on Southeast Asia


Southeast Asia’s longest river winds 4,300 kilometers (2,672 miles) before spilling into the Pacific Ocean, flowing from high up on the Tibetan Plateau to the coastal lowlands of Cambodia and Vietnam. In China it is known as Lancang; in the countries downriver, it’s called the “Mother of Water,” or Mekong, the source of life for the entire region. It is used to water rice fields and mango groves and it provides millions of people with drinking water, food and energy.

In the West, the word Mekong evokes both exotic images and painful historic memories. European colonists. American soldiers. The temple at Angkor Wat. The streets of Saigon. The jungle warfare of the 1960s. Helicopters and patrol boats.

In Asia, though, the future of an entire economic region is dependent on the Mekong. The river connects five very different countries: the economically robust Vietnam, its wary neighbor Cambodia, self-confident Thailand, politically isolated Myanmar and underdeveloped Laos.

At the same time, the Mekong connects these five countries to China, their vast neighbor to the north. For China, the river is an access point to a region where it builds dams and power plants, roads and railways, harbors and factories. Here in Southeast Asia, a world is taking shape, one in which China calls the shots to a much greater degree than it does in Africa, Europe or even Central Asia.

Around the world, Beijing is busy securing access to raw materials and trade corridors and is opening new markets. Its biggest push so far has been through its Belt and Road Initiative, a wide-reaching development program that was initially only supposed to incorporate Eurasia but has since expanded to other corners of the globe.

In some countries, such as Sri Lanka, Pakistan or Ethiopia, China’s presence is already overwhelming. In other places, like Latin America, Beijing’s expansion has been sluggish at best.

But in no other region is China’s influence as pronounced as in the countries along the Mekong. This partly has to do with their geographical and cultural proximity to China, with historical bonds that can be traced back hundreds of years. But it’s also because of a strategic, systematic plan that is bigger than any single project.

A new global power is rising along the Mekong, one that is adaptable and versatile. It adjusts to the precise conditions of each country, from developmental status to economic needs. It takes into consideration the countries’ political systems along with their diplomatic and militaristic preferences.

How exactly, though, does Beijing do it? How is it wielding China’s unique resources and abilities to solidify its influence? Assuming no political or economic crises interrupt the plans of the Chinese government, other countries and regions will sooner or later find themselves confronted with these same questions.

Laos: The Debt Trap

The drive from China’s border to Muang Xay, the first sizeable town in northern Laos, takes 3.5 hours even though the route is barely 100 kilometers long. It leads through small villages and forests of bright green gum trees while chickens and pigs scurry across the road. Some potholes are as deep as bathtubs.

The road rises and falls, and from almost every ridge, construction workers can be seen in the valley below erecting bridge pylons. Boreholes open into the mountains behind them.

A Chinese company is building a 414-kilometer railroad line to the Laotian capital, Vientiane. It’s a technologically ambitious project — half of the tracks will lead through tunnels, while 60 kilometers will be over bridges — yet no one doubts the route will go into operation as planned by 2021. When completed, it will slash the amount of time it will take to get from the Laos-China border to Muang Xay down to 25 minutes. To Vientiane, it will take around three hours.

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The provincial city Muang Xay has become a boomtown thanks to the presence of the construction workers. Hotels are booked solid. Chinese SUVs line the streets.

On the edge of the city, where the train station will soon be located, there is a container settlement belonging to the railway company. The Laotian flag flutters in the wind next to the red Chinese flag. The whole route, says chief engineer Lin, 30, is divided into six construction stages. His office alone employs 4,000 Chinese workers. “A few hundred Laotians work here too,” says Qiu Jixin, 44, the party leader of his division. “But not on the construction side. They help with transport or in the kitchen.”

As party leader, he’s responsible for “ideological education and the fight against corruption,” Qiu says. China’s rail sector is notorious for its slush funds. The Laos project was initiated in 2009 by then-Railways Minister Liu Zhijun. He’s been in prison for years.

Still, the utility of the railway project is evident. Laos, the poorest of the Mekong states, has catastrophic infrastructure. People frequently die of relatively minor diseases because it often takes hours to traverse the horrible roads and reach the next hospital. The new rail corridor could become the backbone of a transit network that would make it possible for the country to catch up to its neighbors.

But at what price? When they first broke ground on the project in 2016, planners estimated the costs at about $6 billion (5.2 billion euros). At the time, that was equal to half of Laos’ entire gross domestic product — an extreme disparity, even when measured against the controversial lines of credit that China has given to other countries. Experts from the World Bank doubt the project’s economic viability.

To lower the impact on its budget, the government in Vientiane leased land to the Chinese construction company: 5 meters on either side of the tracks, plus 3 square kilometers (5.6 square miles) around each of the 10 planned train stations. It’s a model that can be found in many countries in which China builds roads, railways and harbors: Beijing secures land rights in case the borrower country cannot pay back its debts.

In Laos, Beijing presents itself as a contractor of sorts, one that can solve problems more quickly and efficiently than any other country in the world. At the same time, China generates a dependence from which the partner country cannot free itself anytime soon. Laos is caught in China’s debt trap.

Thailand: The Method of Restraint

It may take decades, but if China gets its way, the railway to Laos won’t end in Vientiane. For Beijing, it is part of a broader project, that of a pan-Asian transit network that could one day reach Singapore and include not just roads and railways, but a large canal as well.

In the Thai capital of Bangkok, there are influential people who support Beijing’s ambitions, some of them members of the Thai-Chinese Culture and Economy Association (TCCEA). How this association came into being 40 years ago can be explained in a single sentence, according to its secretary general, Paisal Puechmongkol: “After the U.S. defeat in the Vietnam War, Thailand was looking for an ally against a strengthened Vietnam.” China fit the bill.

One of the projects that Beijing’s friends in Thailand are working toward has busied geopolitical strategists for centuries: the Kra Canal, an artificial waterway which would connect the Indian Ocean to the Pacific.

Currently, maritime traffic between the two oceans — including around 80 percent of China’s oil imports – passes through the Strait of Malacca. But that sea passage is reaching its limits. Nearly 100,000 ships pass through the strait every year. In a few years, the maximum capacity of 120,000 ships could be reached. The possibility that an accident or a military conflict with the U.S. might block this bottleneck has been a source of anxiety for Chinese politicians for some time. Former Chinese President Hu Jintao called it “the Malacca dilemma.”

“The Kra Canal would solve this and other problems,” says Pakdee Tanapura, an economist with TCCEA. Cutting across the isthmus of Kra, a spot where Thailand is only 40 kilometers wide, would not only create a new waterway. It would save shipping companies millions in fuel costs.

Pakdee guesses it would take around eight years and $20 billion to build the canal. The designs he presents bear all the hallmarks of Chinese construction companies. Thailand and China are said to have already signed a declaration of intent, but Pakdee says China is cleverly only lobbying behind closed doors for the project.

There are at least two things that speak against the project. For one, regardless of the canal’s exact placement, it would separate Thailand’s Buddhist north from its unruly, predominantly Muslim south. This would pose a significant problem to Thailand’s domestic security.


A Chinese-owned banana plantation in Laos. China is currently building a railway line through the country.


REUTERS

A Chinese-owned banana plantation in Laos. China is currently building a railway line through the country.

“In addition, India is afraid of the canal,” says Paisal. New Delhi views China’s influence in the region warily and Bangkok must take this into account.

The plan is to move forward, but carefully. The Indian government, as well as Tokyo and Seoul, are to be consulted and included in the project. Most of Japan’s and South Korea’s oil imports also come in through the congested Strait of Malacca.

The debate over the Kra Canal exposes a side of assertive China not often seen. Beijing supports the project unequivocally and would hugely benefit from its construction. But it knows that it has a self-confident and economically potent partner in Thailand that it can’t push around like Laos — or Cambodia.

Cambodia: Exerting Political Influence

Three things are forbidden when you enter a casino in Sihanoukville, a coastal resort city in southern Cambodia: weapons, drugs and alcohol. To ensure that customers understand this rule, it’s formulated in Chinese.

“If I had my way, we’d also forbid the Chinese from driving around so recklessly and from building skyscrapers,” says a driver in Sihanoukville who calls himself Chanly. “Deadly accidents are not uncommon. I’m afraid for my wife whenever she gets on her moped. And then there’s this,” he adds, pointing to one of the dozens of half-finished 30-story towers that have transformed the city center into one big construction site.

Built in the 1950s and named after Cambodia’s former king, Sihanoukville went from being a quiet beach paradise to a “Chinese colony,” as Chanly puts it. Each year, the number of Chinese tourists in the city doubles. Most of them only come to gamble in the casinos.

“Sihanoukville, that’s not Cambodia anymore,” says Vannarith Chheang from the Cambodian Institute for Strategic Studies in the capital Phnom Penh. “China’s embassy is busy around-the-clock with improving the country’s bad image. Eight out of nine Cambodians have a negative impression of China.”

One person who doesn’t is Cambodian Prime Minister Hun Sen, who has been in power for 33 years. Before national elections in July, he boasted on his Facebook page about having the support of China’s leadership.

Hun Sen won the election, in part thanks to China: Beijing’s ambassador participated in one of the ruling party’s campaign events and the national election campaign received a $20 million donation from China. In April 2007, Hun Sen introduced a book by Chinese President Xi Jinping and recommended the “civil servants, professors and students” of his country read it. Shortly before the election, China’s defense minister traveled to Cambodia, calling the country a “loyal friend” and promising $100 million in military aid.

Chheang, the academic, uses a political argument to explain Cambodia’s close relationship to China: The Southeast Asian country has historically felt threatened by two of its immediate neighbors, Thailand and Vietnam. “In this sense, China is a natural ally,” he says. “On top of that, the West doesn’t really know what it wants in the region.” China, he says, is growing so rapidly that the U.S. and Europe can hardly develop new strategies fast enough to deal with the new global power. Small countries in Southeast Asia have little choice but to bow to reality.

In no other Mekong country has China exerted its political will so massively and so overtly as in Cambodia. Its actions in the country show that it takes local conditions into consideration — even if it is an ostensibly democratic election, something that is not a possibility in present-day China.

Vietnam: Economic Presence at Any Price

Shortly before emptying into the South China Sea, there are two large bridges spanning the two main arms of the Mekong. One Vietnam built with the Japanese. The other it built with the Australians.

For China, no other Mekong country has proven as difficult to tame as its neighbor and former wartime enemy, Vietnam. In 1979, the two socialist countries fought a brief but bloody border conflict that was essentially a struggle for primacy in the region following the upheaval of the Vietnam War. Relations have been turbulent ever since.

China is doing everything it can to establish an economic presence in Vietnam. In Hanoi, Chinese companies are building a subway while on the southeastern coast, a Chinese-built coal-fired power plant is about to go into operation. Dozens of Chinese textile factories have settled in the industrial belt around Ho Chi Minh City, as Saigon is now known. China is the country’s largest trading partner.

But anti-Chinese protests still erupt with regularity. In June, hundreds of Vietnamese demonstrated against a law that would have guaranteed long-term lease rights to foreign investors, including Chinese. Four years ago, thousands of people in Vietnam took to the streets to protest the installation of a Chinese oil platform in the South China Sea. In 2016, an immigration official wrote the words “Fuck you” into the passport of a Chinese tourist — on a page with a map depicting China’s claims to a maritime region which Vietnam claims as well.

“In Vietnam, opposition to China never comes from politicians,” says Nguyen Chi Tuyen, 42, a vocal critic of the Vietnamese government. “On that subject, the government is driven by the people.”

What scares him about China isn’t only the country’s economic supremacy and its imperial ambitions. “Much greater is our fear of China’s authoritarian model, a technologically advanced surveillance state,” says Tuyen. This model is one the leadership of Vietnam’s state party finds attractive, he says. “Our government is still a long way from being able to constantly monitor its citizens like the one in Beijing does. But even I now have to think twice about who I meet with.”

It is difficult to say whether the ideological affinities between the two state parties are enough to ultimately overcome the difficult relations between China and Vietnam. Beijing doesn’t have many levers when it comes to exerting influence over Hanoi. The two countries work together closely economically. But with a population of 95 million, a sizeable economy including a robust tourism sector, the country isn’t totally helpless against China’s superior power.

Because China isn’t yet strong enough militarily to enforce its claims on the South China Sea, it exerts indirect pressure on Hanoi. Here, Beijing’s massive investments in Laos and Cambodia are paying off: Laos takes a rather neutral position in the debate over who should control the islands, while Cambodia is completely on China’s side.

Vietnam has its own indirect methods for getting what it wants. In March, for the first time since the end of the Vietnam War, Hanoi allowed a U.S. aircraft carrier to dock in Vietnam, the USS Carl Vinson, which had been sailing through the South China Sea and projecting American influence in the western Pacific.

The signal was clear: Vietnam is looking for allies to compensate for China’s strategic dominance in Southeast Asia.

Myanmar: Stepping Into the Void

One of the most successful Chinese movies of all time is a thriller called “Operation Mekong,” and it’s based on a true story. In 2011, river pirates on the Mekong hijacked two Chinese freight ships and killed all 13 crew members. Investigators identified a drug boss from neighboring Myanmar as the mastermind behind the plot and he was eventually extradited to China and executed. Since then, in addition to patrols from Thailand, Laos and Myanmar, the Chinese police have also established a presence on the lower reaches of the river. And although four of countries through which the Mekong flows already cooperate under the auspices of the Mekong River Commission, Beijing established a new organization in 2015 to which Myanmar and China also now belong. It is called the Lancang-Mekong Cooperation.

China’s control of Southeast Asia has long gone beyond building railways, canals, casinos and power plants. Along the Mekong, Beijing’s display of power has taken on a dimension that explicitly includes political and strategic goals. To achieve them, China’s leadership is even willing to break with its decades-old doctrine of not getting involved in other countries’ political crises.

Beijing, for example, noticed when the West rescinded its goodwill toward Myanmar’s de facto leader Aung San Suu Kyi after she failed to condemn atrocities committed against the country’s Muslim Rohingya minority. Western politicians had barely finished giving speeches expressing their disappointment in the 1991 Nobel Peace Prize laureate by the time Chinese President Xi Jinping received her. Beijing. China’s Foreign Minister Wang Yi proposed a three-stage plan as a solution to the crisis and suggested his country play the role as mediator — a most unusual occurrence in China’s modern history.

Observers of China’s engagement in Africa, the Middle East and in the Indian Ocean see a pattern: Where other countries are pulling back, Beijing is swiftly stepping up its game. It happened when India and EU member states turned away from civil war-torn Sri Lanka. It happened when Saudi Arabia and Israel were alienated by the U.S. under Barack Obama. And it is being seen in Pakistan the more Washington’s relationship to country falters.

It is a pattern that will repeat itself in Southeast Asia – particularly now that Europe and the U.S. are mired in their own problems, raising the possibility that the requisite strategic foresight may not be present.

None of the countries on the Mekong have a strong rule of law. None of them are democracies by Western standards. This is no less true for the single-party dictatorships in Laos and Vietnam than for the military-dominated regimes in Thailand and Myanmar or the increasingly authoritarian Cambodia under the leadership of the autocrat Hun Sen.

But in all of these countries, there are people who are afraid of a new world order dominated solely by China.

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