A World Divided

Scrap that idea. I was recently in the United States, and was arguing for a need for policy to start thinking of China and the Middle East as the same policy challenge. What I learnt is that this isn’t going to happen anytime soon.

It seems that the financial sector can look beyond geographical divides. But the military and political sectors are struggling. It’s perhaps not surprising. It’s easy enough to move an investment banker from Dubai to Beijing. Money is, after all, pretty much the same in any country. But it’s far harder asking a Chinese-speaking political analyst, after spending years tracking the activity of China’s Politburo, to think about relations between Iraq’s central government and Kurdistan.

If this seems an obvious point, it shouldn’t. China’s ability to import oil from Iraq may yet play a role in the country’s energy security. And the Iraqi central government’s recent blacklisting of Sinopec, a major Chinese oil company, for dealing in Kurdistan, is an example of how globalization has already changed the way we need to think about the world.

 

Where are the obstacles?

First, most analysts, and officials for that matter, are already overburdened looking at established issues. This is particularly true in the Middle East where you can take you pick of issues, including the Israeli-Palestine issue, withdrawal from Iraq, or Iran’s nuclear program. Most analysts don’t have the bandwith to think about how China fits into the picture.

Second, most military and political analysts are divided by their geographic territory. Take the Central and Pacific Commands. I was surprised to hear there is little dialogue between the two on issues such as China’s growing interests in the Gulf. “Welcome to the military”, said one officer at the U.S. Naval Academy when I expressed my surprise at the situation.

Part of the problem is that there is a cost to switching between geographic territories, whether it is the time invested in learning a new language or the effort of having to build a new set of contacts. Evan Feigenbaum at the Council on Foreign relations is perhaps one of the few to have succeeded, having started as a Chinese specialist before working in for the U.S State Department in both India and Central Asia.

I should add that this isn’t just a problem for the United States. It is a problem for all the major powers, including China.

Third, Washington no longer has the same magnetic pull. The United State’s dominance meant that most of the world’s most pressing issues found their way to the nation’s capital. But that’s less true today. Consider a strategic investment deal signed between Beijing and Riyadh.

There’s no reason for this to make itself known in Washington unless someone takes an interest.

The upshot is that because much of China’s growing relations with the Middle East isn’t easily observed, I didn’t feel the urgency in Washington to look at the changes taking place.

How might this attitude change? I see two pressure points. The first is China’s growing oil interests in the Gulf. This is already expected to gain attention and will gain more. The second is China and the Middle East’s investment in U.S. govemment debt. Their purchases are attracting growing interests at a time when legislators worry about how to finance a ballooning fiscal deficit.

I also met some smart people examining at the issue, and look forward to working with them in the coming years. My speaking events were also well attended, and I have discovered a growing number of post-graduate students looking at China’s relations with the Middle East, to suggest that a new crop of analysts might yet emerge, ready to cross those geographical divides.

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Silk Road Gallery

Canton Trade Fair
August 12th, 2010

Editorials & Articles

“China cheat sheet helps investors survive”, Bloomberg, September 1, 2010

“No more silver bullets for Beijing”, Wall Street Journal, June 17, 2010

“China’s historic return to the Gulf”, Foreign Policy, April 2, 2010

Speaking Events

International Monetary Fund, Washington, October 10, 2010

SuperReturn Asia, Hong Kong, September 29, 2010

The Global Pricing Forum, Hong Kong, September 14, 2010