This morning’s key headlines from GenerationalDynamics.com

APEC meeting ends in disarray after harsh U.S.-China disagreements


Xi Jinping and Mike Pence

Four days ago, I described the approaching meeting of the Asia-Pacific Economic Cooperation (APEC) Leaders’ Summit in Port Moresby, the capital city of Papua New Guinea (PNG), over the weekend as a competition for influence between China and Australia.

There was indeed such a competition, but it was the competition between China and the U.S. that made the biggest news. The media were predicting that the U.S. presence would be almost minimal because President Donald Trump was not going to attend.

But in Trump’s place was Vice President Mike Pence, who spoke very harshly about China’s Belt and Road Initiative (BRI) and its use of debt trap diplomacy in infrastructure projects that were intended to benefit China more than the countries put into debt. The result was that for the first time ever, the APEC meeting ended with no joint communiqué.

Pence’s speech included a joke about “a constricting belt or a one-way road”:

Too often they come with strings attached and lead to staggering debt. Do not accept foreign debt that could compromise your sovereignty. Just like America, always put your country first.

…

Know that the United states offers a better option. We don’t drown our partners in a sea of debt. We don’t coerce or compromise your independence. The United States deals openly and fairly. We do not offer a constricting belt or a one-way road.

When you partner with us, we partner with you. and we all prosper.

China’s Communist Party chief Xi Jinping spoke before Pence did, but he responded to much of what Pence said:

Mankind has once again reached a crossroads. Which direction should we choose – confrontation or cooperation? Openness or closing one’s door? Win-win progress or zero sum game. The interest of all countries and the future of mankind hinge on the choices that we make.

…

Let me make this clear. The Belt and Road Initiative is an open platform for cooperation. It is guided by the principles of consultation and cooperation for a share of the benefit. It is not designed to assure any hidden geopolitical agenda. It is not targeted against anyone, and it does not exclude anyone.

China has been losing a great deal of credibility over debt trap diplomacy because more examples keep emerging. Everybody has now heard of the Seaport of Hambantota, a Chinese infrastructure project in Sri Lanka funded with a loan from China and mostly built by Chinese workers using parts imported from China, so that the loan money never benefited Sri Lanka’s industries. Sri Lanka was unable to repay the loan and in December of last year, Sri Lanka was forced to give the seaport away to China. So now Sri Lanka has a large seaport owned by China, and a large Chinese enclave with hundreds of Chinese families, with no benefit to itself and to its own people.

China’s loans and aid in the Pacific region have gone from almost zero to $1.8 billion in the last decade, and China has pledged to spend $8 billion more.

Fiji owes China half a billion dollars and Tonga now owes more than $160 million, or one-third of its GDP. Several other Pacific Island countries are also overwhelmed with debt to China.

There has been major drama involving China and Tonga in the last few days. Tonga has been begging China for relief from its debts for several months, with no success. But then a few days ago, Tonga’s prime minister called on the Pacific Islands to band together against China. Tonga backtracked on this call within a few days, but the reasons were unclear. And then it emerged on Sunday that China was granting Tonga a five-year reprieve in paying back the loan.

As part of that announcement, China will lend Tonga more money for yet another BRI infrastructure project. Reuters and Australian Broadcasting (16-Nov) and BBC and Australian Broadcasting

Aggressive behavior of China’s officials raises concerns about security

There were several incidents of extremely aggressive behavior of Chinese diplomats attending the APEC conference.

On Saturday, four Chinese officials barged into the office of PNG’s foreign minister Rimbink Pato after they had been denied a private meeting. Security was called to the office and the officials had to be forced from the room. As a result, additional police were stationed at the government building to guard Pato’s office.

China demanded the meeting because it wanted to make sure that the draft version of the final communiqué (which, in the end, was never issued anyway) contained language that was satisfactory to China. The U.S. wanted to including language directed at China without mentioning China, calling for reforms to world trading rules to target predatory trade conduct and demanding state-owned enterprises be forced to compete on a level playing field with private businesses. China apparently barged into Pato’s office to make sure that the communiqué did not contain the U.S. language.

The second issue is that Chinese officials strictly controlled media access to Xi Jinping, even ejecting PNG journalists who had been invited to cover a meeting between Xi Jinping and some Pacific Island leaders. Apparently, Xi Jinping prevented any but Chinese media from having an opportunity to ask a question. One can only guess why. Australian Broadcasting and Bloomberg and Australian Broadcasting

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KEYS: Generational Dynamics, Papua New Guinea, PNG, China, Australia, Asia-Pacific Economic Cooperation Leaders’ Summit, APEC, Belt and Road Initiative, BRI, Xi Jinping, Mike Pence, Sri Lanka, Seaport of Hambantota, Tonga, Fiji, Rimbink Pato
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