From Volume 37, Issue 48 of EIR Online, Published Dec. 10, 2010
Asia News Digest

China Warns of Korean Situation Spiraling 'Out of Control'

Dec. 2 (EIRNS)—China reiterated its call today for an emergency meeting of the members of the six-party group on North Korea. Speaking at a Foreign Ministry briefing, spokeswoman Jiang Yu rejected the criticism that the government had received from certain quarters for calling for talks. Jiang indicated that China, as the host of the six-party talks, had a special responsibility in that respect, so that no one should be surprised by the initiative. She also underlined that the only option for resolving the crisis would be through discussion among the relevant parties. Russia, she said, had already accepted the proposal. She also underlined that China was not calling for a formal session of the six-party talks, but rather a meeting of the members of the talks to discuss the immediate crisis situation.

U.S. Secretary of State Hillary Clinton said on the same day that she had held talks with Russian and Chinese officials on North Korea, during her visit to Kazakhstan for the summit of the Organization for Security and Cooperation in Europe (OSCE). Speaking in Bishkek, Kyrgyzstan, the next stop of her Central Asian tour, Clinton said: "I've already spoken to high-ranking Chinese and Russian officials, and we will discuss how we can work together to try to avoid conflict." She announced that she would meet with the foreign ministers of South Korea and Japan to discuss the Korean crisis on Dec. 6 in Washington. "The U.S. is very concerned about North Korea, and we want to work with countries in the immediate region," she said, those being China, Russia, South Korea, and Japan.

However, Clinton continued to demur on the Chinese proposal to hold an emergency meeting of the head delegates to the six-party talks.

Presidents Barack Obama and China's Hu Jintao spoke by phone on Dec. 5—the first discussion since the outbreak of the current crisis in Korea. While the White House indicated that Obama had lectured China that it is responsible for North Korea's actions, and must "send a clear message to North Korea that its provocations are unacceptable," the Chinese Foreign Ministry reported that Hu warned Obama that if the situation were "not dealt with properly, tensions could well rise on the Korean peninsula or spin out of control, which would not be in anyone's interest."

China To Sign High-Speed Rail Agreements, Including with U.S.!

Dec. 4—China expects to sign a number of cooperation documents with other nations on high-speed and other railway development, at the Seventh World Congress on High Speed Rail in Beijing, said Chen Juemin, head of the international cooperation department at the Ministry of Railways, according to China Daily. The Congress, sponsored by the International Union of Railways (UIC) and Chinese Rail Ministry, will take place in Beijing Dec. 7-9, the first time it has been held outside Europe. Among the agreements, Chen said, is one already initiated between CSR Corporation Ltd., one of China's biggest rail vehicle producers, and the U.S. General Electric Co., to establish a joint venture in the United States to manufacture high-speed trains using Chinese technology. The agreement will likely be signed during the conference, China Daily reported.

U.S. press reports say that the two corporations may bid to build high-speed train lines in California and Florida. CSR chairman Zhao Xiaogang told the press in Hong Kong yesterday that they may jointly bid for a project on the U.S. East Coast.

China may also sign agreements or memoranda of understanding with railway authorities and enterprises in Turkey, Sweden, Germany, Bulgaria, Canada, Slovenia, and North Korea, Chen said, although not all will be for high-speed trains. China currently has the largest (by far) high-speed rail network in the world, and in the next year or so will have more than the rest of the world put together. It has also designed and built the fastest and longest rail lines, and is beginning to build in the challenging terrain as its mountainous southwest.

The CSR-General Electric association could compete with leading companies, including Canada's Bombardier, Inc., France's Alstom SA, and East Japan Railway Co. China has also proposed helping to finance the California high-speed rail line.

China is also working with Myanmar, Cambodia, Thailand, and Laos to plan and develop high-speed rail links to Southeast Asia, and with Turkey and Bulgaria to connect to the rest of Europe. There are also discussions ongoing with Iran.

Indian Foreign Secretary: No Space for Conflict with China

Dec. 3 (EIRNS)—As long as India and China, the world's two most populous nations and neighbors, pursue their national interests, especially domestic development, their joint relations will grow, Indian Foreign Secretary Nirupama Rao said today in an address to the Observer Research Foundation, in New Delhi. India needs $1 trillion worth of infrastructure investment in the next five years; China is "well positioned" to help here, she said.

Geopolitical, and "geo-economic" types spend a lot of time and effort to play up the possibility of economic and military conflicts between the two Asian giants; however, despite their still-disputed border, their national interests are converging more and more, as Rao said. Speaking just two weeks before the arrival of Chinese Prime Minister Wen Jiabao for a two-day visit, Rao emphasized that "neither of us has the luxury of seeing each other in antagonistic terms. The view that India and China are rivals to me is an over-generalization as well as over-simplification of a complex relationship.... The reality is that India and China have worked hard over the last two decades to enhance dialogue in a number of fields, and we must maintain and build on that trend." She added: "I believe this is a big relationship with the clear possibility of an ambitious agenda of mutual engagement that will be one of the most important bilateral equations of our new century."

Rao herself has 30 years' experience with China, including having served as ambassador. She accompanied then-Prime Minister Rajiv Gandhi on his groundbreaking trip to China in 1988, which re-opened relations between the Asian giants after their Cold War-induced 1962 border conflict.

She pointed out that although long sections of their border and neighboring territory are still disputed, "What also needs to be appreciated is that the India-China boundary is one of the most peaceful of all borders." She also called for "more sensitivity" from China on territory still disputed between India and Pakistan.

A key issue is economic ties. "Our trade with China is growing faster than that with any other country and China is our largest trading partner in goods, with trade likely to exceed US$60 billion this year," Rao said.

U.S., South Korea Agree to Free-Trade Pact—But Will It Fly?

Dec. 3 (EIRNS)—U.S. Trade Representative Ron Kirk announced today that the United States and South Korea had agreed on revisions to the Free-Trade Agreement (FTA) signed three years ago, which may satisfy the opposition in the U.S. Congress that has stalled implementation of the agreement. The new deal will allow the U.S. to postpone lowering tariffs on Korean cars for five years, and open up the Korean market to American cars, despite the fact that they do not meet Korean safety and emissions standards.

The U.S. Congress was not the only roadblock to the deal: The Korean parliament has also refused to pass the FTA agreed to three years ago, and may be even more opposed to the new concessions. A senior member of the governing GNP party, Rep. Na Kyung-won, told a Washington audience this week, that, since the FTA talks were going on in the shadow of U.S.-Korean military exercises after the recent exchange of fire between the Koreas, the opposition would certainly argue that the government was giving away economic sovereignty in exchange for security, and may well stop it.

In any case, a Free Trade Pact with the U.S. at this time would be a deal with a corpse, as the U.S. economy is doomed, without an emergency Glass-Steagall reform of the banking system.

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