Inside Asia

A new peasant revolution – is China learning from its past?

By Thu-Trang Tran

“Every dynasty in China's imperial history was destroyed by discontented peasants and drifters”

Tuesday 16 May marked the 40th anniversary of the launch of the Cultural Revolution. Forty years since China has emerged the world’s fourth largest economy and is predicted to be the world’s largest economy in 20 years.

Although the Chinese government may not wish to confront nor discuss the social unrest and violence of the Cultural Revolution, it seems the government is wary of history repeating itself. The government is concerned about the simmering social tension resulting from the widening wealth gap as the giant economy powers its way to the top spot. Over the years, the discontent of the farmers and migrant workers has started to manifest. In response the Chinese government recently launched a campaign to build a ‘new Socialist countryside’ with the aim of eliminating social inequality a key priority for the coming five years.

The class struggle continues…
China’s economy has been growing at a rate of about 10 percent a year for at least the past decade. The impressive pace of growth can easily be seen in the explosion of mega-metropolises the likes of Shanghai and Guangdong. A PricewaterhouseCoopers report projected that China will grow so fast that it could outstrip all developed nations by 2050 (based on purchasing power parity).

However, the fruits of such new market pragmatism have not been delivered to the rural population. In 2005, the per capita net income of Chinese farmers rose by 6.2 percent to 3,255 yuan (US$405), while the disposable income of urban dwellers rose by 9.6 percent to 10,493 yuan (US$1,304), 3.22 times over their rural counterparts. Furthermore, according to the China’s National Development and Reform Commission, the richest 10% of the country’s urban population control 45% of urban assets while the poorest 10% hold only 1.4%.

Another peasant uprising?
The 40th anniversary of the Cultural Revolution is a timely reminder of the possible violence and brutality that can descend upon a nation when the gap between the ‘haves’ and ‘have nots’ reaches its tipping point.

Mao launched the Cultural Revolution in response to the increasing capitalist trend and class struggle believing the Cultural Revolution would ultimately create a new society without gap between urban and rural regions. The result? The bourgeoisie were overthrown, millions forced into manual labour, tens of thousands executed, and the wealth gap continued to widen to date.

In China’s new economic revolution, there is no cult of Mao. However, class struggles remain and parallels may be drawn. The 21st century capitalists are the old bourgeoisie and intellectuals of the Cultural Revolution; corrupt Party officials are the old party enemies of Mao; and the farmers and workers are the old student Red Guards. If 800 million rural dwellers – that is 70% of the population – continue to be left out of the economic boom, then one can expect the worse unless actions are taken to temper their discontent.

In the last decade, two developments have exacerbated the tension between the city and the countryside: the urban shift and land grabs.

Impoverished rural dwellers are flocking to the country's eastern cities seeking opportunities. Unfortunately, due to the hukou system of household registration (‘a system akin to South Africa's apartheid’), rural dwellers are treated as second class citizens. Compared to their urban counterparts, they are deprived of the benefits of housing and schooling for their children and struggle to find employment, compounding the urban unemployment problem. Furthermore, the mass migration of abled-bodies to the cities means that there is lack of potential for productive growth in the rural region due to fewer workers being available.

The rural dwellers are also losing their precious farmland to corrupt officials and urban developers. Although such land is communally owned, for farmers, the land is a means of making their living. Farmers all over China now see ‘their’ land taken away, bought by developers from corrupt local government officers. Land on the outer-edge of the cities are then converted to McMansions or factories that earn millions for the developers and entrepreneurs. The money however, does not reach the hands of the farmers.

Unable to reap the rewards of economic growth that their privileged urban peers have reaped, and angered by the land grabs by officials, farmers are staging protests around the country and demanding government attention. In January 2006, the Ministry of Public Security announced that there were 87,000 such incidents in 2005, a 6.6 percent increase over the previous year. For example, in June last year, in the village of Dingzhou, local residents clashed violently with security officers over the local government’s seizure of land for a power plant and low compensation paid to residents.

It appears the government is taking heed of the social discontent and is responding with policy actions to relieve the social tensions.

One of the goals in China’s 11th five-year plan is to build a ‘new Socialist countryside’. The aim is to promote coordinated urban and rural development, to promote agricultural productivity, to deepen rural reform, to develop rural public services and to increase farmers’ income.

One recent policy announcement in favour of the rural dwellers is the proposed abolition of the hukou system in 11 of China's 23 provinces, mainly along the developed eastern coast. The aim is to encourage a new influx of labour from poorer western regions and to stabilize the protests. However, there are concerns that such reform will strain the local cities’ resources and municipal governments may object the proposed change on such grounds.

Furthermore, as of March this year, the government has made plans to increase spending on rural health care and schools. The government aims to spend 4 percent of GDP on education (up from 2.7 percent) with the aim of improving rural schooling. Other measures include cutting basic agricultural taxes and increasing farm subsidies to support the farmers and close income disparity. In relation to land requisitions, Premier Wen Jiabao suggested more efforts would be made to protect farmers.

If one remembers that every dynasty in China's imperial history was destroyed by discontented peasants and drifters, the threat of a ‘peasant uprising’ posed by the ever-widening wealth gap between urbanites and rural-dwellers is a real one and should not be underestimated. Therefore, any policies formalised at the National People's Congress (China’s parliament) in March need to make real inroads in elevating the rural dwellers out of poverty and not be mere token policies.

Further readings:
BBC - Chinese communist revolution
Time Asia - The next cultural revolution
Voice of America - Rural revolt - growing unrest in China
Seeds of Revolt in Rural China: ‘Farmers' Heroes’ give a voice to besieged taxpayers, By John Pomfret, The Washington Post, Tuesday 8 May 2001; Page A01
Transformation of rural China - by Jonathan Unger
Villagers and popular resistance in contemporary China - Lian Jiang Li & Kevin J. O'Brien

This all-male debate lacks depth

By Professor Stephanie Fahey is director of the Research Institute for Asia and the Pacific, Sydney University and chairwoman of the National Committee of Women in International Security Australia.

Article published on April 19, 2005 in the Sydney Morning Herald.

Women have a limited role in Australia's think tanks, writes Stephanie Fahey.

Every evening the family living room is filled with news of international security, terrorism and defence but in Australia, women's voices on these issues are silent - or perhaps being silenced? Whatever one may think of the views of Condoleezza Rice or Madeleine Albright, the US has propelled women into influential positions in which they display keen interest and capacity. So where are their Australian counterparts?

At least half the staff and students studying international relations are women. Following the gender policy reforms in the Department of Foreign Affairs and Trade in the 1960s, and much later in the Defence Force, the gender imbalance has improved but few women are accepted into high-profile positions or engage in public commentary on international security - seemingly one of the last bastions of male dominance. Who are the established public commentators and who reinforces their monopoly?

The Lowy Institute for International Policy now rivals the Australian Strategic Policy Institute on defence issues. Lowy experts appear regularly in the media, but none is a woman.

Looking at its board of directors, senior staff, researchers, speakers and international collaborators, it is difficult to find a woman actively contributing to the debates. Its international advisory board has an American woman member, and of the 16 professional staff and visitors, the only woman is Martine Letts, a former diplomat with expertise in arms control, but as a deputy director she is yet to contribute to policy debates.

At the inaugural conference of the Lowy Institute in 2003, the program included not one woman. At last week's Sturdee Symposium on Australian Grand Strategy, co-hosted by the Lowy Institute, Senator Marise Payne did chair a session, although no women made it to the symposium dinner.

The Australian Strategic Policy Institute is a little better, with one woman board member, Jocelyn Newman, and one researcher, Dr Ellie Wainwright.

Not many would argue that women should be excluded because they are women, although some still argue that women have nothing to contribute because their perspectives and policy recommendations are indistinguishable from those of men and so it is unnecessary to include them or, even worse, what women have to contribute is inferior and therefore should not be entertained.

Thirty years ago debates were rehearsed and won regarding women's rights to hold senior and influential positions and their capacity to enrich and diversify the workplace, so why is the defence and international security arena in Australia so myopic in relation to gender participation? Those in positions to orchestrate change acknowledge the imbalance but demonstrate no obvious commitment to change.

The debates in defence and international security in Australia are already too narrowly defined and the recent, largely semantic, differences of interpretation of the Defence of Australia doctrine point to how shallow the ground has become. Women can enliven discussions in conflict management, foreign policy and peace building, just as they have in many other debates.

Groups of women subscribe less readily than men to the myth of the efficiency of violence; women tend to expose the "underbelly of war" by focusing on basic needs such as food and health security; they tend to be preoccupied with the bigger picture - the consequences - while some men maintain personal agendas of power. Initiatives powered by women usually emphasise inclusion, participation, consensus building, dialogue and sustainable elements crucial in international security.

Women do make a difference to the debates - so if women are not in positions to contribute, then a positive contribution from Australia's think tank community would be to actively mentor young women instead of perpetuating a male apathy which engenders resentment and ultimately confrontation.

Nepal's youth and politics

Somini Sengupta from the New York Times writes about Nepal's young lashing furiously at the past. (IHT)

"We will not ask the king to leave the throne - we will go and take the throne and put it on display," Gagan Thapa, 29, the political symbol of young Nepal, told a crowd of thousands on the outskirts of the capital Thursday, New Year's Eve in Nepal. The vast majority, dressed in baseball caps and jeans and looking well below the age of 30, roared in approval.

"We will burn the crown," Thapa shouted.

The crowd hollered back: "Burn the crown! Burn the crown!"

Nearly 60 percent of Nepal's 23 million citizens are under 24. They came of age after democracy came to Nepal in 1990, and they have tasted the fruits and failures of electoral politics.

In February 2005, they saw their king suspend Parliament and install prime ministers of his own choosing in a bid, he said, to defeat the Maoist insurgency. For 14 months, they have lived under the king's direct rule. This past week, he banned protests in the capital and for six days imposed a daytime curfew.

That order has not stopped young people from pouring into the streets. They have suffered most of the police beatings: On just one day this past week, of the 59 people admitted to Katmandu's main teaching hospital for treatment of their injuries, only 13 were over the age of 30.

Read the article published in the International Herald Tribune.

Another article written by Kanak Mani Dixit in The Nation explores people power in Nepal.

Singapore's young challenges beg to differ

It is not surprising that Singapore ruling People's Action Party (PAP) recently returned to power with 66.6 percent votes. Despite the overwhelming mandate, the votes in fact represents a fall from 75.3 percent in the 2001 polls.

Prime Minister Lee Hsien Loong believes that his party has 'struck a chord' with the younger voters. Speaking at a post-election news conference early Sunday, he said 'there was a clear difference in voter preference between the different opposition parties.' (Channel News Asia) '...the results show younger voters understand what's at stake and have voted rationally.'

However, 'the man who created Singapore in his own severe image, Lee Kuan Yew, had an unsettling glimpse into what could be the future of his country, and he did not like it.'

Writes Seth Mydans from the International Herald Tribune, during a 'live television three weeks ago, 10 polite young Singaporeans, challenging Lee, who is 82, with a confidence and lack of deference that is rare among their elders here.' (IHT)

'About 40 percent of eligible voters were born after Singapore became an independent nation in 1965. Like it or not, they are their country's future, and their vision now stands side by side with that of Lee.

"What we want is a choice," said Mabel Lee, 28, an editor and television presenter. "What we want is political vibrancy. What we want is a media that could reflect both the views of the opposition as well as of the ruling party fairly. What we want is to see that the opposition is being given a level playing field. What we want is fairness in the political sphere."

Lee argued back as if he had met, in this open-minded younger generation, his real opposition -interrupting, cross-examining and telling them that they needed to be put in their places like his own grandchildren.

"Let me tell you this," said Lee, who holds the title of minister mentor and whose 54-year-old son, Lee Hsien Loong, is prime minister of Singapore. "If what you say is a reflection of your generation, then I'm a bit sad."

People over 55, he said, people who had known the hardships his country had overcome to provide them with their affluence and stability, would never talk this way.

The dark side of China's rise

In the current article (March/April 2006) of the Foreign Policy Minxin Pei, a senior associate and director of the China Program at the Carnegie Endowment for International Peace, argues that Beijing's brand of authoritarianism is spawning a dangerous mix of crony capitalism, rampant corruption and widening inequality.

If current trends continue, 'China's political system is more likely to experience decay than democracy...and the very policies that the Party adopted to generate high economic growth are compounding the political and social ills that threaten its long-term survival'.

In his article, Minxin Pei suggest that the combination of authoritarian rule and the state's economic dominance has bred a virulent form of crony capitalism, as the ruling elites convert their political power into economic wealth and privilege at the expense of equity and efficiency.

'The state's economic dominance preserves systemic economic inefficiency as scarce resources are funneled to local elites and bureaucratic consitutencies.'

In supporting his argument Minxin argues that the World Bank estimates that, between 1991 and 1000, almost a third of investment decisions in China were misguided. The Chinese central bank's research shows that politically directed lending was responsible for 60 percent of bad bank loans in 2001-02.

The Chinese economy has fallen victim of crony capitalism with Chinese characteristics - the marriage between unchecked power and illicit wealth. 'The most corrupt sectors in China, such as power generation, tobacco, banking, financial services and infrastructure, are all state-controlled monopolies.

Various indicators, pieced together from official sources, suggest endemic graft with the state. Between 1992 and 2002, the number of 'large-sum cases' (those involving monetary amounts greater that $6,000) nearly doubled. More wealth is being looted by corrupt officials. The number of officials at the country level and above prosecuted by the government rose from 1,386 in 1992 to 2,925 in 2002. On average, 140,000 party officials and members were caught in corruption scandals each year in the 1990s and 5.6 percent of these were criminally prosecuted. In 2004, 170,850 party officials and members were implicated, but only 4,915 (or 2.9 percent) were subject to criminal prosecution.

It seems to Minxin, the ruling elites in China appears drifting and insecure. 'Fearful about what the future may hold, some officials do not want to wait even a few years to turn their power into wealth. In 2002, almost 20 percent of the officials prosecuted for bribery and nearly 30 percent of those punished for abuse of power were younger than 35. In Henan Province in 2003, 43 percent of local party bosses caught up in corruption were between 40 and 50 years old (as compared with 32 percent older than 50).'

'China has seen its future leaders, and a disproportionate number of them are on the take.'

Minxin Pei is the author of China's Trapped Transition: THe Limits of Developmental Autocracy (Cambridge: Harvard University Press, 2006)

Japanese Official Development Assistance

The Research Institute for Asia and the Pacific assesses Japan’s distinctive development assistance programs and their significant contributions to Asian countries.

By Kara Hennigan

The University Of Sydney’s Research Institute for Asia and the Pacific (RIAP), in conjunction with the Japanese Ministry of Finance has released its report on Japanese Official Development Assistance in the Asian Region.

The book contributes to the international debate about Official Development Assistance (ODA) by assessing Japan’s unique role as an ODA donor. Its uniqueness is attributed to Japan’s ODA philosophy and practices that has been markedly different from that of other Organization for Economic Cooperation and Development (OECD) member states. It is also the only OECD member to have been an aid recipient and a major aid donor. “Japan’s financial commitment to ODA has been second to none: by the end of the 1990’s Japan was the world’s largest ODA provider, with most of its funding targeting economic and social development in East and Southeast Asia.”

The report examines Japanese ODA in Asia by first discussing the origins of Japanese attitudes towards development assistance, such as its belief in the effectiveness of ODA loans rather than grants as well as its use of the private sector to encourage development. This is due to Japan’s experience as a recipient of successful ODA, following World War II. Secondly, because Japan’s aid differs from the assistance of other OECD nations, the report offers an evaluation of Japanese ODA compared to the latest international thinking on ODA and development. Finally, Japanese ODA is examined in Indonesia, China, Viet Nam, Malaysia, South Korea and Thailand over key areas such as agriculture, education, infrastructure development and critical industries.

Contact: Leslie Williams
Phone: 02 9351 8537
Email: [email protected]

Speed date out of a shrinking society

(photo BBC News)
How should a country tackle a shrinking population? Organise speed date parties is one option. It may not be romantic, but it is proving increasingly popular in Japan.

Opposite sex making connection in rapid succession and with bare minutes before a bell signals its time to move is one scheme encouraged by the Government.

‘The hope is that by encouraging people to date, marry and start a family, the current demographic trend leading towards a shrinking population can be arrested’, observes Duncan Bartlett from the BBC World Service. (BBC)

Why is speed dating popular in Japan? The problem seems common. Spending long hours at work is an obstacle to office workers finding love.

"It's becoming harder to meet suitable partners these days and that's one reason why people are getting married later," says speed date party organiser Natsuko Minami.

Even local governments in Japan are ‘prepared to provide financial support for the businesses that organise dating events as part of its efforts to tackle what it sees as a major social problem.’

Japan is facing an ageing and shrinking population. Its population of 128 million is projected to fall by 100 million by 2050 if problem is not arrested. The Government is taking counter-measures against the falling birth rate. Child support allowance has been expanded.

Another measure considered is the loosening of its restrictive immigration intake. ‘But any changes may come as a shock to a nation where registered foreigners make up just over 1 percent of its population.’

Reading links:
1) Duncan Bartlett, Japan pins hopes on 'speed dates'
2) BBC, Japan population starts to shrink
3) BBC, Japan women's singular contentment
4) National Institute of Population and Social Security Research, Population projections for Japan: 2001 - 2050

India's boom time

'The New India' is the cover story for Newsweek's magazine. Newsweek's international editor, Fareed Zakaria, writes: '...Fascinated by the new growth story, perhaps wary of Asia's Chinese superpower, searching to hedge some bets, the world has woken up to India's potential. But does it really know this complex, diverse country? Just as important, does India know what it wants of the world?'

Within six weeks, a parade of leaders, former leaders and monarchs have visited India. George W. Bush is currently in India. Two weeks earlier, Jacques Chirac was there, so was Bill Clinton. 'Two weeks before that it was Saudi Arabia's newly crowned monarch, King Abdullah. The week after Bush leaves, Australian Prime Minister John Howard arrives.' Prince Charles and Camilla Parker Bowles are not far behind.

Related articles worth reading:
1) What's behind India's success in the global knowledge economy?
2) Morgan Stanley's Ruchir Sharma argues that Indian leaders are enjoying the boom times but putting off more painful reforms
3) Outsourcing Silicon Valley
4) Amartya Sen of Harvard University, Nobel laureate in economics, argues that as India receives more attention, so must its practice of democracy.
5) Out with the revolution: It's time to get rich! - In Marxist ideology, the International Herald Tribune writes, capitalism is a necessary stopover along the inevitable journey to communism. But in a southern Indian state named Kerala, 'a lush state of mountain tea plantations and rivers colonnaded by coconut palms, it just might be the other way around.'

Bali Nine Diplomacy

The Australian Government is facing a diplomatic dilemma in the wake of two of its citizens, Andrew Chan and Myuran Sukumaran, recently being sentenced to death by firing squad (pending appeal) for their role in the attempted trafficking of heroine from Denpasar airport.

The ‘Bali Nine’ case has focused attention on the diplomatic relationship shared by Australia and Indonesia.

The cases of Chan and Sukumaran have come all too soon after another Australian, Van Nguyen, was hanged by Singaporean authorities for attempting to smuggle heroine. In that case, appeals from all levels, including Prime Minister Howard, to spare Nguyen’s life were dismissed as Singapore ruthlessly pursued its domestic drug policies.

The Australian government has made clear its opposition to the death penalty, being a signatory to the ‘Second Optional Protocol to the International Covenant on Civil and Political Rights’ and annually co-sponsoring a resolution of the UN Human Rights Commission calling for all nations to abolish the death penalty. It also views itself as a standard bearer for human rights in the region.

To maintain such a stance, Canberra should be seen to make some form of representation for its citizens. However, it is also important that it maintain good relations with its northern neighbour. Indo-Australian relations are probably at their strongest point for some time, and Australian does not want to spoil such an entente by appearing to meddle in the domestic affairs of neighbouring countries. It is a fine line to tread and Canberra will have to ensure it stays balanced.

The arrival two weeks ago of 43 West-Papuans on Australian shores provides another sticking point in the Indo-Australian relationship. The boat people have been classed as illegal immigrants and President Susilo Bambang Yudhoyono has requested they be promptly returned. However, the West-Papuans have claimed refugee status as the result of persecution and violence from Indonesian authorities, and Canberra is holding back from immediately responding to Jakarta’s request.

Australia currently occupies the space between a rock and a hard place as it struggles to continue to build relations in the region while maintaining its campaign for worldwide human rights. Canberra’s maneuvering will be closely watched as it attempts to play a delicate hand. Commentators will be eager to see whether Canberra can achieve both ends.

Author: Rhiannon MacNamara, Research Institute for Asia and the Pacific, University of Sydney

China's growth

Once again, much of the world's focus is on China's dramatic growth and its prospects for 2006. Chinese government statisticians have recently reported their economy to have grown at 9.9% during 2005, and many economists are suspecting it to have been stronger still.

Economic growth reports for 2003 and 2004 have both been initially declared at 9.5% only to be later revised upwards to 10% and 10.1% respectively. This has led to suspicions that Beijing is purposely reporting growth figures below 10% in order to stave off international pressure on its fixed currency policy. China's yuan has been pegged to the US dollar for just over a decade, and most corners agree it to be grossly undervalued, lending an export advantage in the world market. China reported in early January its trade surplus to have tripled in 2005 to $102 billion, and it total foreign trade topping $1.4 trillion. Such a figure has pushed China to number three in the world in foreign trade after the US and Germany, and ahead of Japan.

While the US complains about an undervalued yuan and its effects on the American export market, as well as there being concerns amongst Washington's reputed hawks about China's military modernisation, Australia has enjoyed a China-fed economic boom, particularly in its resource sector.

China is now Australia's second largest export partner, recently overtaking the United States, but remaining behind Japan. There is a definite prospect of an FTA being negotiated soon and Canberra is busy drafting an agreement for a lucrative uranium export deal. All of this points to a closer economic relationship being shared by the two countries. Australia's recently appointed ambassador to the US, Dennis Richardson, used his maiden speech appearance to suggest that America's attitude to China should change from one principally based upon competition and regional threat, to one of partnership and opportunity, just as Australia has done.

Due to these reasons, both Australian and world eyes will once again be focused on the growing dragon in 2006. Economists will eagerly wait to see if the 2005 growth figures will indeed be revised upwards, and whether the yuan's status will move beyond the 2.5% correction of June last year. If not, will Washington go so far as to label China a currency manipulator as it has threatened, and how will consequent Sino-American relations affect Australia's relationships with both countries, particularly in the case of a uranium trade deal being signed. On top of all of this is the anticipation of the Chinese economy's 2006 performance, as we wait to see whether it indeed breaks through the 10 percent growth range.

Author: Luke Easey, Research Institute for Asia and the Pacific, University of Sydney