China's Long-term Interests in keeping Business, Business

Not sure about the etiquette of cross posting (if anyone does let me know) - but I wanted to extend on a comment I previously made on the great Sudanwatch blog - below is their original post.

Sudanese President is convinced China has never been, will never be tool for US pressure on Sudan - see Middle East Online today: Beshir denies Chinese pressure on Darfur - excerpt:

"The Chinese president did not convey any US demands on the situation in Darfur during his recent state visit to the Sudan," Beshir told the independent Al-Sudani daily.Beshir said that during their meeting last Friday, Hu had asked him to "continue implementing the Abuja agreement and working to improve the situation on the ground".

Hu :renewed his commitment to offering full support to my government to enable it to implement its declared Darfur programme, particularly after he was briefed on our position which advocates dialogue and a peaceful settlement"."Our conviction is that China has never been and will never be a tool for US pressure on Sudan," Beshir told Al-Sudani.

Washington -- which accuses the Sudanese regime of genocide in Darfur -- sent envoy Andrew Natsios to Beijing last month to seek increased diplomatic coordination with Khartoum's key ally.

My Comment:
As the Chinese have said on several occassion - 'Business is business'.

This is more than a statement of Chinese policy on Sudan, it is a much broader act of public diplomacy directed at all current and potential trading partners. By declaring that China will not raise issues of governance or human rights in Darfur, they are affirming to all other possible partners with dodgy governments that they can rely on China.

China's neutral stance on the politics of business partners is their competative advantage in the international economy. It has allowed them to penetrate sectors in which they are not technically or economically internationally competative.

The oil sector in Sudan is a perfect example of this. China's petroleum sector was underdeveloped and widely believed to have been immature. It is widely believed that Sudan could have extracted significantly more oil, more quickly and more profitably had they partnered up with Western companies. Thus by refusing to engage in political discussions with Sudan they have been able win concessions that otherwise would not be available to them. In the process they have been able to learn by doing and improve their extractive sectors - the cost for the Sudanese has been high.

The same kind of deal goes for many of Chinese actual and potential business partners - 'take us, we are worse at doing the job, but we won't complain about your internal politics.' I believe that China's intractability over Darfur reflects Beijings fear that if they shift away from their 'no politics' stance publicly in Sudan they risk their current and future relationships with many other countries. And with it their future energy security.

As a result, I think Bashir is probably right that China will not back down unless they are offered some serious carrots.