Economic Belligerence

Over the past few days if you have been following news coming out of China sample this -
1. 4 Rio Tinto employees arrested on charges of spying in China.
2. China has closed down all mosques in the disturbed areas.
3. China suspended the words democracy, freedom etc. from the TV feeds during the Tiananmen Square anniversary
4. China being asked to support the sanctions against North Korea
and so on...

Reading the above snippets don't you get the impression that China basically does what it decides to do with nobody questioning it. My analysis - this is just because of the economic might of the country.

G8 countries made a statement yesterday that they will push for renewed call for CTBT and ensure that NPT becomes prominent again. I believe it was not so subtle a hint to India the only non NPT nation present at the meeting to get its act together and join the NPT. Without debating whether India should do so or not ( thats for another blog )I can bet that if in place of India it was China which was a non signatory to NPT the world could do nothing about it.

North Korea has been threatening the world with its missile tests, nuclear tests and aggressive posturing towards its neighbors namely Japan and South Korea. Sure it has been slapped with even tougher sanctions but its not widely known that inspite of these sanctions the North Korean economy is still growing - some estimates say by 4%. Ever wondered how is this possible? Ever wondered who is the biggest trade partner of this rogue nation?....China and it is this tacit support which is allowing North Korea to cock a thumb at all. Now the question is why is China able to get away with this? again because of the economic power it has.

In order to fund the 1 Trillion Dollars stimulus package which US has introduced the Treasury has been forced to issue more of the Treasury Bonds. These Bonds have been bought in large numbers by China. Hence if tomorrow China decides to offload these bonds in the world market, US economy could be crippled. In addition, over the years China has emerged as the factory of the world. In such kind of a situation is it a big surprise that everybody looks the other way irrespective of whatever this big nation does?