Sat | Dec 14, 2019

Jaristotle's Jottings | The Yankee-Sino Quagmire

Published:Thursday | November 14, 2019 | 12:15 AM

Admiral Craig S. Faller, commander of the United States Southern Command (SOUTHCOM), last week warned Jamaica to be wary of China’s activities throughout Latin America and the Caribbean, citing security concerns regarding China’s ties with Venezuela, a safe haven for terrorists, according to him. China’s reaction was very swift, citing Faller’s comments as ‘irresponsible’. Any which way we view this, Jamaica is now caught in a quagmire best reserved for superpowers.

Jamaica’s relationship with China has centred around bilateral financial assistance and the engagement of Chinese firms to execute multibillion-dollar construction contracts, all under China’s Belt and Road Initiative aimed at expanding their global footprint. Suffice to say, the Americans have not been comfortable with China’s growing forays into various strategic areas of the world, particularly in the Caribbean, their backyard.

The American perspective

The reality for Jamaica is that the USA has effectively become Kingston 20, and with a significant diaspora therein, one cannot readily ignore the deep personal and business relationships between both counties.

The Americans consider the Caribbean to be part of their ‘third border’ and their security and economic assistance comes with costly impositions designed to curtail the flow of narcotics, proceeds of crime and terrorists through the region. Despite our best efforts, the quid pro quo support has been pitiful. Jamaica can ill afford to pursue American interests while ignoring the development needs of its own citizenry, notwithstanding that favourable relations with the US must remain a priority for the government.

China to the ‘rescue’

Whereas Jamaica’s efforts to achieve and maintain compliance with global and particularly American-driven conventions and standards have proven quite burdensome, China’s entry into the arena, with a less stringent set of ‘requirements’, has provided some breathing space for our governments, at least in the short term. This seemingly ‘no strings attached’ attitude is what concerns the Americans, who have long held that China wants to play in the international trading arena without any rules, paving the way for very predatory practices.

Their concerns may have merit. Numerous reports suggest hidden catches to China’s benevolence, including the takeover of strategic national assets, particularly seaports, when respective governments falter in their payback requirements. Essentially, China faces a win-win situation. Returns on investments are guaranteed, whether through long-term payback arrangements or default takeovers of investments.

There are other social and economic considerations that we should consider as well. Again, according to Faller, some five million-plus Chinese nationals are now immersed throughout the region: this is quite evident here in Jamaica where every nook and cranny has been overtaken by cash-centric Chinese businesses.

What is their operating modus? Are they integrated into the formal business and banking sectors, or are they merely accumulating enormous amounts of cash outside the banking system, converting these earnings to foreign currencies and shipping it out of the country? How do such practices affect the foreign exchange markets?

As I see it

Being ever cognisant of the trade issues between China and the US, and more specifically the American view that China’s economic assistance initiatives are predatory and cleverly expansionist, our neighbouring superpower is clearly uncomfortable with China’s penetration into its ‘third border’ area.

Washington has been more of a ‘backra master’ than a caregiver in recent times: it is unreasonable for them to expect Jamaica to ignore the needs of its people in order to satisfy their interests and to snub olive branches offered by other superpowers.

Jamaican interests must always be the priority of our governments, but we must also bear in mind that those who come bearing gifts are doing so for their own interests. We must tread cautiously lest we become irreversibly engulfed in this quagmire.

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