Recently, there has been a relatively little publicized competition going on in Africa for control of major oil & natural gas fields in several countries. The main players in this heated battle are major US & Chinese oil companies. Chinese players utilize very persuasive tactics to lure the development contracts into their corner. Construction projects, focusing on roads and local infrastructure, has begun with the claimed intent to diversify their investments in the region. In almost all cases, the preemptive construction projects are soon followed by approved bids to control regional resource development. The nature of these projects distinctly resemble the common use of "kick-backs" that are standard in China business practice.
The question that begs to be asked is if the Chinese government's direct involvement in these companies, who are so aggressively acquiring assets around the world, is a violation of the WTO's (World Trade Organization) agreement on Subsidies and Countervailing Measures. The last time this WTO agreement became commonplace in western media, the fight was between Boeing Aircraft Company and the the European Union's Airbus. Airbus was accused of unfairly receiving subsidies from several major governments in the EU.
Now the fight is between western companies and those directly sponsored by the Chinese government and their strategic ambitions. The Obama administration, and US lawmakers, have remained quiet about the issue. There is an eery silence in the US hanging over most issues involving China these days, especially among topics of trade and currency.
Keeping quiet in the face of unfair competition, especially during a strung-out financial crisis, seems a bit like bringing a knife to a gunfight. China's strong-fisted authoritarian policy tactics cannot be effectively combated with passive negotiations and bilateral solutions that leave western companies at a severe disadvantage.
Despite China's recent growth and consistent increases in GDP, they have a long way to go before they catch up to the United States, mainly in terms of per capita metrics. Western media, however, has been portraying China as on the brink of taking over the #1 position. Let us not forget that China is ranked 133 of 229 for per capita income meaning, on average, Chinese citizens make only $6,000 per year (2008 estimate). China's strength lies in the sheer size of the population, which often makes the numbers seem to be in their favor. Historically, it takes education, income, and opportunity to make a country truly competitive for the long term. Not size of GDP.
In times of a global financial mess, one should allocate their resources to come out of it with some strategic advantage over the rest. Current US policy makers are bickering about relatively insignificant issues while leaders around the globe are competing in a power grab to pick up the pieces that are being dropped by the country that has seemed to have lost it's ambition to be a great leader.
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