Abstract
Rapprochement with Taiwan continues to dominate China’s foreign policy
landscape – with recent
announcements of direct flight, shipping and
postal services between the two countries – but the mainland
has not
focused on this to the exclusion of other efforts to stake its claim as a
geopolitical power, and is
ever-ready to strongly criticise US arms sales
to Taiwan.
In Q408 China reiterated its friendship with Pakistan under
2005’s Treaty of Friendship, Co-operation
and Good-neighbourly
Relations between the two nations, signing 12 memorandum’s of
understanding
on economic co-operation and free trade, undertook
anti-terrorism manoeuvres with Indian forces, and
sent a high-level
military delegation to Nepal. In the latter case, the meeting was phrased as
being part of
normal relations between the two countries, although there
was talk of how China might help protect
‘Nepal’s sovereignty
and geographical unity’. China has also stated that it is willing to
boost military ties
with Bahrain.
Unrest in the Uighur
Muslim-dominated Xinjiang province in north-west China in the middle of the
year
faded completely from view in Q408, as the economic situation in
China became the dominant threat to
internal security, with a raft of
civil protests, by taxi drivers, laid off workers and other groups across
the
country over recent months.
China announced a 4trn yuan (US$590bn)
stimulus package in November, which it hopes will support the
200,000 new
jobs it needs to create each year for university and school leavers, as well
as stimulate
domestic consumption as its export industry continues to
suffer from the economic downturn. A series of
infrastructure and public
works at its heart could allay some of the distress citizens are feeling from
the
fiscal climate.
The Chinese arms industry is still booming, but if
there is any significant decline in economic growth this
situation could
change. It has begun competing in the global defence market although as we
have said in
previous reports arms companies are dogged by over-staffing,
inefficiencies and being based far from
major manufacturing centres.
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