International Relations Omnibus

[Marxist ßastard]

The leaked diplomatic cables had these gems from South Korea's Vice Foreign Minister (and now national security adviser) Chun Yung-woo, in which he quoted senior PRC officials:

 

Vice Foreign Minister Chun Yung-woo told the Ambassador February 17th that China would not be able to stop North Korea's collapse following the death of Kim Jong-il (KJI). The DPRK, Chun said, had already collapsed economically and would collapse politically two to three years after the death of Kim Jong-il. Chun dismissed ROK media reports that Chinese companies had agreed to pump 10 billion USD into the North's economy. Beijing had "no will" to use its modest economic leverage to force a change in Pyongyang's policies -- and the DPRK characterized as "the most incompetent official in China" -- had retained his position as chief of the PRC's 6PT delegation. Describing a generational difference in Chinese attitudes toward North Korea, Chun claimed XXXXXXXXXXXX believed Korea should be unified under ROK control.

 

*** *** *** *** *** ***

XXXXXXXXXXXX Chun claimed XXXXXXXXXX believed Korea should be unified under ROK control. XXXXXXXXXXXX, Chun said, were ready to "face the new reality" that the DPRK now had little value to China as a buffer state -- a view that since North Korea's 2006 nuclear test had reportedly gained traction among senior PRC leaders.

 

*** *** *** *** *** ***

Chun argued that, in the event of a North Korean collapse, China would clearly "not welcome" any U.S. military presence north of the DMZ. XXXXXXXXXXXX Chun XXXXXXXXXXXX said the PRC would be comfortable with a reunified Korea controlled by Seoul and anchored to the United States in a "benign alliance" -- as long as Korea was not hostile towards China. Tremendous trade and labor-export opportunities for Chinese companies, Chun said, would also help salve PRC concerns about living with a reunified Korea. Chundismissed the prospect of a possible PRC military intervention in the event of a DPRK collapse, noting that China's strategic economic interests now lie with the United States, Japan, and South Korea -- not North Korea. Moreover, Chun argued, bare-knuckle PRC military intervention in a DPRK internal crisis could "strengthen the centrifugal forces in China's minority areas."

 

*** *** *** *** *** ***

Chun acknowledged the Ambassador's point that a strong ROK-Japan relationship would help Tokyo accept a reunified Korean Peninsula under Seoul's control. Chun asserted that, even though "Japan's preference" was to keep Korea divided, Tokyo lacked the leverage to stop reunification in the event the DPRK collapses.

 

*** *** *** *** *** ***

He reviewed several issues he hoped to discuss during his upcoming visit to Washington, including North Korea, Iran and Afghanistan/Pakistan. On North Korea, VFM He hoped to hold "informal consultations" in Washington on how generally to approach the North Koreans, not just through the Six-Party Talks. Washington and Beijing nevertheless needed to discuss how to maintain momentum in the Six-Party Talks so as to preserve our common interest in stability of the Korean Peninsula. North Korea wanted to engage directly with the United States and was therefore acting like a "spoiled child" in order to get the attention of the "adult." China therefore encouraged the United States, "after some time," to start to re-engage the DPRK.

So either China is pulling some serious wool over ROK's eyes, or they've really run out of support for DPRK.

Edited March 1, 2012 by Marxist ßastard

[Nintii]

@ MB ... what's with all the XXXXXX's are they kisses and if so, are they for me ? :teehee: ... just some humor there.

 

Yes, it's a lot like I thought, China does not want the US on it's doorstep ... good quote.

 

A question here though, why would Japan NOT want a unified Korea, that doesn't make sense.

[Lisnpuppy]

I doubt that China is going to sit idly by and allow any Western styled democracy to pop up on it's door step either

Um, China enjoys quite healthy relations with Mongolia and South Korea.

 

EDIT: I was going to tell you to educate yourself and start reading Foreign Policy, but you think the CFR is an Illuminati conspiracy... so yeah...

 

Awww...I see what you did there. Made like you were not taking a pot shot at everyone but in truth, you totally did. Nice try MB. As much as I DID NOT wish to use my moderator-yellow (I should trademark this thing...kinda like Ferrari Red or something) pen today...I am. Strike 1 for you for making disrespectful remarks to other members just asking for a bit of flaming and making my eyes hurt trying to type with yellow on a white screen. Ok I just added that last part in but...~Lisnpuppy

[HeyYou]

I would point out that China enjoys "healthy" relations with the US as well. At the moment....... Trade with the US, and Europe, is what is driving their economic boom. Not to mention trade with countries that the US will NOT deal with..... That will last so long as it is advantageous to the Chinese. Currently, they are using the cash they get from us to develop weapons to FIGHT us. (missiles that can track, and destroy, carriers at sea....) Should push come to shove, China can destroy the US without firing a shot. The US government knows this. The Chinese government knows this. Hence, the Chinese government has more control over the US government than the american people to. (the scrapped sale of fighter jets to Taiwan springs immediately to mind....)

[Marxist ßastard]

Should push come to shove, China can destroy the US without firing a shot.

Okay a claim like that needs evidence.

[HeyYou]

Should push come to shove, China can destroy the US without firing a shot.

Okay a claim like that needs evidence.

 

A few simple words. "We are calling your loans due."

 

Dumping all their US treasury bonds.

 

Shutting off exports to the US. (considering most of our manufacturing has moved there, this would be devastating. of course, it wouldn't do wonders for THEM either......)

[dazzerfong]

@ MB:

 

HeyYou has a very valid point: as of May 2011 the largest single holder of U.S. government debt was China, with 26 percent of all foreign-held U.S. Treasury securities (8% of total US public debt).

 

Source.

[Marxist ßastard]

HeyYou has a very valid point: as of May 2011 the largest single holder of U.S. government debt was China, with 26 percent of all foreign-held U.S. Treasury securities (8% of total US public debt)

Uh-huh. Look at your numbers – 26% of foreign-held debt is only 8% of the total debt? So by far, the greatest holder of US debt is US citizens. The Fed is the second-largest holder. China comes at third, Japan a close fourth, and the UK fifth.

 

But yes, the Chinese central bank owns about a trillion in US debt. Why so much? Not for political leverage, but to effect its own currency manipulations. The Chinese government wants to keep its own currency, the yuan, weak against the dollar. That way, it's cheaper for US companies to buy goods from China than from domestic suppliers. So they tell the central bank to continually dump the yuan on the market and buy US treasury securities. A side-effect is that now China's foreign reserves comprise mostly US treasury securities, which have an unfavorable yield compared to China's own GDP growth.

 

What can China do with all these treasury securities? Certainly not "call them due" (what? ). The truth is, China has already divested of its short-term treasury securities, to very little effect. What remains is a collection of long-term, illiquid debts which don't come due for 10 or 30 years. And since the yield on those securities is so low, when the US does pay them back, it will be a net loss for China. China could order their central bank to sell all the treasury securities at a further loss – but to whom? What states are richer than China, hate the US, and don't have any dollar-backed holdings that would be hurt in such a deal? And what does China get from this? In the long term, the US will have to increase its interest rates to sell debt. But in the short term, China's foreign reserves would be devastated, US–China diplomacy would be set back decades ("Hello, Taiwan? Want to buy some nukes?"), and Chinese exports to the US would get vastly more expensive, forcing US buyers of Chinese goods and labor to look elsewhere. It wouldn't make sense under any circumstance.

 

Don't like China? Fine, you're in good company. But don't wrap your insane yellow-menace Sinophobia in feigned concern over US finances.

[marharth]

What about all the Chinese goods MB? It seems to me our economy would be pretty messed up if China stopped trading with us. A lot of our crap is made in China and I don't think we will be able to quickly recover from a Chinese trade embargo.

 

I might be wrong though.

[Marxist ßastard]

Chinese trade embargo

China's already played around with embargoes, to very little effect. All Chinese exports to the US can be produced elsewhere.

 

Or to inject some numbers into this: Every person in China generates $326 in exports to the US, versus Mexico's $2,329 and Canada's $9,321. There is nothing more replaceable to the US economy than a Chinese worker.