China Reform Monitor: No. 729

November 13:

A contingent of 218 Chinese engineers and medical staff has arrived in the Democratic Republic of the Congo (DRC) for an eight-month UN peacekeeping mission. The deployment constitutes the ninth Chinese peacekeeping team since 2003 to be sent to the African country, which remains racked with civil war. The People’s Liberation Army Daily reports that engineering troops from the Lanzhou Military Command will be engaged in constructing water and power facilities, building roads and maintaining airports.

[Editor’s Note: Later that week, a spokesperson from China’s Foreign Ministry said that in addition to developing the DRC’s mineral resources Chinese companies also develop infrastructure, medical and health care services. Earlier this year Beijing and Kinshasa inked a $9 billion ore-for-infrastructure barter deal, which had looked to be profitable for both sides; recurrent instability, however, continues to make the implementation of this deal uncertain.]


November 18:

China’s President Hu Jintao has touched down in Lima for this year’s Asia Pacific Economic Cooperation (APEC) forum accompanied by the gathering’s largest delegation: twelve ministers and almost 600 business leaders and support staff. Hu is poised to sign a bilateral trade agreement with Peru that could see China overtake the U.S. as the Andean nation’s top trading partner. “It is inevitable that China will become Peru’s number one trading partner,” says Juan F. Raffo, chair of APEC Business Advisory Council. Luis Valdivieso, Peru’s finance minister, told the Financial Times Lima was “very concerned about the recession that is going on in the US, Europe and the slowdown in Japan.” China already has significant investments in commodity-rich Peru, including Chinalco’s recent $2.2 billion investment in the Toromocho copper mine.

[Editor’s Note: China has been steadily expanding its relations with Latin America. En route to Peru, Hu visited Cuba, where he signed an economic cooperation agreement, and Costa Rica, which is seeking a trade deal with China. Chile signed its trade agreement with China in 2005. Last month, China also last month joined the Inter-American Development Bank as a donor member, with $350 million investment in financial development projects.]

The Beijing-leaning Ta Kung Pao has published a series of articles based on its reporters’ nearly month-long visit along the 1,334-km China-North Korea border. The newspaper’s reports, which were conducted along the northern banks of the Yalu and Tumen Rivers, said that the drop in commodity prices caused by the global financial crisis has lead Pyongyang to halt the export of copper, lead, and aluminum to China. Historically, the DPRK has been dependent on the sale of mineral and ore across the boarder and its shut down has made squid the reclusive regime’s largest export to China; accounting for about sixty-five percent of the total imports from the DPRK in the first seven months of 2008. Other than a “bumper crop” of squid, however, one witness in Longjing City said: "There has been no business whatsoever this year. Border traders stay idle at home simply doing nothing. People on this side do not have goods to transport from the DPRK, while people on the DPRK side, much less, do not buy things." As a result, the value of trade goods through the Shatuozi Frontier Trade Port in Hunchun was only $6.1 million in the first seventh months, a drop of 36.9 percent; only 1,667 vehicles entered and exited the trade port, down 32.3 percent.


November 19:

China's People’s Liberation Army (PLA) and the Indian Army and will hold their first joint army exercise on Indian soil next month, the Press Trust of India and Zee News report. A 10-member delegation of Indian army officers is in Beijing to finalize “Belgaum” in Karnataka (a southern Indian state) as a venue for the fortnight-long drill. The exercise, whose theme will be counter-insurgency operations, will be the second joint army exercise between the two countries and will include over 150 infantry support personnel from each side. The first joint training operation, held last December in China’s Kunming province, was codenamed “Exercise Hand-in-Hand.” The two armies will carry out patrol, ambush and searches in insurgency-infested areas.