Economy Watch – 2013-11-15 01:14:02

http://www.economywatch.com/features/china-military-buildup.06-11.html

(November 6, 2013) — The scale of China’s military build-up has raised flags among Western alarmists. Yet the focus of the military spending appears to be oriented more towards defending China’s periphery, rather than any expansionist plans. In fact, one common argument is that China’s growing military power is only meant to counter the force of the US, which has been increasing its presence in the region.

There is an excellent saying that encapsulates the relationship between war and economics in the modern world. It goes something like this: when trade moves across borders, armies don’t.

The European Union is, of course, the clearest modern example of the way in which trade encourages civilized bonds between countries who might otherwise be tempted to resolve differences through the exchange of bullets rather than goods.

China — as the world’s second largest economy, and as a country on course to become the world’s leading economy in twenty years or so — is at the heart of world trade, and is widely regarded as the engine that may yet prove sufficiently powerful to pull Europe out of its slow-to-no-growth quagmire.

So, if our axiom has any basis in reality, it would seem wildly unlikely that China would pose a military threat to the West -or, indeed, to any region.

However, sometimes things just “happen”, and not for the better. The link between politics and the military in China is so strong that some overt glorification of military prowess, along mildly fascist lines, is probably inevitable — which doesn’t make it a smidge less dangerous.

China has already shown that it is prepared to counter Japanese nationalism over the Senkaku Islands, Diaoyu Islands if you are Chinese, with as much saber rattling as Japan wants to go in for. It is building up its naval capabilities in the South and East China Seas and that is a direct challenge to the US, putting the two largest economies in the world on something of a wildly unnecessary collision course.

The new Chinese supremo Xi Jinping, or Head of the Politburo Standing Committee to give him his formal title, made the following point in his speech to the Chinese people: “To realize the great revival of the Chinese nation, we must preserve the bond between a rich country and a strong military, and strive to build a consolidated national defense and a strong military.”

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