US v EU power and profits conflict
The European Union is preparing to abolish its arms embargo against China. The main reasons are China’s rapid military build-up and the huge Chinese market. Despite the embargo, arms sales approvals to China from the EU doubled between 2002 and 2003. These plans, however, have led to sharp criticism from the US, and risk increased tensions between the EU and the US.
This was a key subject for discussions during US Secretary of State Condoleezza Rice’s tour in Europe, last week, and will also be when President Bush visits Europe during the end of February. Despite some media reports, however, the debate has nothing to do with human rights in China (the US argument) or encourage China as a world partner (the EU argument). It’s all about power (the US) and profits (the EU).
"They’re talking about helping the Chinese kill Americans more effectively", a Pentagon official commented in the ‘Financial Times’ (FT) (London, 25-26 Dec).
In the beginning of January, a senior White House spokesman warned that lifting the embargo could "result in major problems for transatlantic arms procurement".
The EU move is mainly symbolic. Its arms embargo, implemented in 1989, after the massacre on students and workers in Beijing, is not legally binding. According to the FT, "France and Britain actually have some military training links with China".
Sales doubled
In the years 2000 to 2003, China was the biggest arms purchaser in the world, after the main Western powers, like the US and France. The value of arms transfer agreements for China in that period was $9.3 billion. Of course, the arms industry in the EU wants to increase its sales. Approvals for arms sales from the EU to China actually doubled from 210 million euros in 2002 to €416 in 2003 (In 2001, it was €54.4m). The biggest share was with French arms companies, who got licenses worth 171 million euros in 2003. Of this, €2m were for bombs, rockets and missiles, with another €45m for military aircraft.
The French and German governments have pushed for the embargo to be lifted, and where "recently joined wholeheartedly by the UK" (FT 10 February).
This is an important political concession to the Chinese regime, since Beijing has been campaigning for the embargo to be lifted and accused the EU of discrimination. The other countries under EU arms embargo are Burma, Zimbabwe and Sudan.
The ending of the EU embargo against China means important economic gains for the major European powers. China had postponed an order for the latest airplanes, the ‘A380’, from the world’s biggest plane makers, Airbus. Airbus is a joint German-French-British-Spanish concern. In light of the EU finally acting to lift the embargo, China, in January, ended the restrictions for buying the A380.
Before the embargo, China was a big arms purchaser in Europe, for example, buying anti-aircraft flak guns from Sweden. Lifting the embargo would open new possibilities, not just for arms sales. The German Prime Minister, Gerhard Schröder, leading the campaign to lift the embargo, visited China at the beginning of December, last year. He then concluded deals for the sale of 23 Airbus planes (not A380) and 180 locomotives from the German company, Siemens. Schröder has pledged not to sell arms to China, but is fully satisfied with the non-military market.
China is, at the same time, campaigning to be accepted as a "full market economy" by the EU, something that strengthens its hand in trade disputes. The EU, on its side, is demanding that China take back "illegal" refugees expelled from EU countries. Last year, Amnesty International reported that 200 activists from the 1989 Chinese democracy movement were still in jail. As a concession in the talks with the EU, the Chinese regime released a few well-known leaders from 1989, among them strike-leader Chen Gang.
Taiwan target
China is conducting a strong military build-up, particularly directed at Taiwan. Nationalism has become the dominant ideology for the leaders in Beijing. China’s claim on Taiwan, as a part of "one China" is the backbone of this ideology. In 1996, China’s military spending was equivalent to 2.5 of the country’s GDP. In 2002, this share had grown to 4 per cent. Since China’s economic growth is the strongest in the world, the increase in money terms is very big. 4 per cent of GDP in 2002 was 52 billion dollars. Only the US and Japan has a bigger military budget (the US military costs are 408bn dollars, plus Iraq). China’s military personnel 2.3 million is the world’s biggest.
In 1995-96, tensions between China and Taiwan sharpened. China conducted missile tests close to Taiwan’s coast and the US, the main defender of Taiwan since the Chinese revolution in 1949, replied by sending two aircraft carrier groups to the Taiwan Strait. Since then, the US has more military co-operation programmes with Taiwan than with any other allied state. US imperialism is conducting a complex balancing act, because of its growing economic dependence on China. American transnational companies invest hugely in China, both for export and for the growing domestic market. The purchase of US state bonds by the Chinese state helps the US run its big deficits. In practice, the US therefore stands for maintaining the status quo in formal relations between China and Taiwan, i.e. that Taiwan is, de facto, ‘independent’, but still officially part of "one China".
US rhetoric in defence of Taiwan against "communism" is still strong amongst the neoconservatives, the traditional conservatives and the Pentagon. A CIA report, quoted in the Financial Times, even concluded "An EU-China alliance, though still unlikely, is no longer unthinkable".
Taiwan’s Foreign Minister, Chen Tan-sun, warned that China could become an "evil power".
In the US House of Representatives, 411 votes against three condemned the EU plans. In the White House there is also a strategic fear of China developing as a challenge to US world power. This explains the warnings now given to the EU.
"Code of conduct"
EU leaders have replied that the embargo will be replaced by a "code of conduct", under which suppression of democratic rights will be taken into account. The change will have "little practical effect" and will "not lead to an increase in quantity of European arms to China", the British Foreign Minister, Jack Straw, told Washington on a recent visit. Chinese officials make the same claim.
The EU also pointed out that another close ally of the US, Israel, is second in arms sales to China after Russia. Israel has, for example, sold US Patriot missile technology to China.
Both Straw and the EU Foreign Business Commissioner, Javier Solana, have commented that the US will most likely not punish the EU. The timetable is therefore for the embargo to be lifted before the end of June.
Condoleezza Rice’s tour kept a conciliatory tone. The debates of recent weeks, however, indicate that the US will act in one way or another. A postponement of exporting military technique to the EU from the US has been raised. This would, in particular, affect the British military. In the other direction, European companies could stop participating in the arms sales market in the US, roughly half the world market.
Politically, lifting the embargo on China will strengthen the contradictions between the EU and the US that linger on from the Iraq War, only this time with no EU state publicly supporting the US. It will strengthen the unilateralist wing in Washington, which will push to further downgrade consultations with the UN, the EU and others. Strategic contradictions in Asia, between the US and China, are highlighted by this issue, despite their mutual economic dependence today.
Socialists are opposed to today’s global arms race and increased arms sales, which are features of modern capitalism. The lifting of the arms embargo is further proof that the EU is controlled by big business. The democratic rights of workers and the oppressed are subordinate to profits.
The global arms industry must be taken into state ownership, under democratic workers’ control and management. Its enormous resources and research capabilities should be transferred to socially necessary projects (housing, healthcare, education etc), while every job must at the same time be guaranteed.
Today’s arms industry capitalists and ruling politicians will, of course, fight against every such proposal for change. This is why new mass workers’ parties are needed, with a bold socialist programme, to fight for a socialist society worldwide.
This is an updated version of an article on chinaworker.org
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