Mon, Mar 24, 2003 - Page 10 News List

China may remain focused on trouble within its economy

AFP , HONG KONG

Despite joining the WTO and installing new leaders, China's role on the world stage will remain limited as it struggles to deal with enormous domestic problems, experts said this week.

Beijing's discreet approach has been in evidence throughout the Iraq crisis, according to Evian Group analysts who met here this week, when it has opposed the US-led invasion without aligning itself with fellow dissenting UN Security Council permanent members France and Russia.

"The leadership wants to concentrate on economic growth," said Professor Fan Gang, director of Beijing's National Economics Research Institute.

"China will keep a low profile in international affairs."

According to one of Hong Kong's most prominent businessmen, "China is just learning how to play the international game.

"It takes time for China to find its place. They will only get involved to the extent that it is necessary," he said.

The main reason is the scale of the challenges faced by the Chinese leadership, from reforming state enterprises to rural unemployment, and the need to pick its way carefully through the minefield ahead.

"The policy option of the leadership is very narrow: you cannot go back but you cannot jump ahead too much either," said Fan.

"I don't think the overall policy will change very much."

Fan said it was of paramount importance for China's leaders to maintain strong economic growth, currently running at 7 percent to 8 percent annually, to counter growing social inequalities.

"The only way in the long run to solve the inequality problem is through growth," he said.

Another tenet of the Chinese discretion is Beijing's great dependence on the US and the American market.

Although the Asian financial crisis underlined the danger of excessive reliance on the US, many countries have not learnt their lesson, said Asian affairs commentator Philip Bowring.

"There is a tendency in Asia to increase the dependency on the US market while they should try to get away from that," said Bowring.

"Why is China so silent?" asked Francois Godement, director of the Asia center at the French Institute of International Relations. "Economic access has been forged with the US: it is clear that this has policy consequences," he said.

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