Internal Weakness of China – Food, Marine & Malacca

China has spoiled its  bilateral relations with those nations on whom it depends for its food. Having depleted the seas close to home, the Chinese fishing fleet has been sailing farther afield in recent years to exploit the waters of other countries. The PRC’s dependence on Malacca gives rise to security concerns because the surrounding region is vulnerable to disruption that could block maritime traffic and a substantial portion of the PRC oil supply. 

The United Nations warned in June that the world is on the brink of its worst food crisis in 50 years. While China supports over 20 percent of the world’s population, it has a little over 12 percent of its arable land (according to the World Bank). According to the China Meteorological Administration, the country has experienced a 20 percent increase in heavy rainfall since 1961, taking the water level of more than 400 rivers above the flood control line, with 33 of them reaching record highs. Yangtze River basin which accounts for 70 percent of China’s rice production, has seen the worst floods since 1939, damaging millions of acres of cropland. The heavy rain has ravaged vast swaths of industrial and agricultural land, and experts warn the worst may be yet to come. 

With Floods, Insect infestations also have caused great damage to China’s food sector. An invasion of fall armyworms and locusts devoured millions of acres of wheat and corn crops this year. African swine fever has forced authorities to kill more than 180 million pigs, or about 40 percent of China’s swine population, causing prices to soar. Imports of meat have jumped significantly in just one year.

Food Shortage

The Chinese Academy of Social Sciences estimates that China’s domestic supply of rice, wheat and corn will fall short of demand by 25 million tonnes by the end of 2025. According to the China’s National Bureau of Statistics, food prices went up by 13 percent in July, compared to the previous July; the price of pork rose about 85 percent. On a year-on-year basis, food prices have increased by 10 percent in 2020 the price of corn is 20 percent higher and the price of soybeans, 30 percent.

Chinese brokerage firm Shenwan Hongyuan has anticipated that China could lose 11.2 million tons of grains this year, compared to last year. Even billionaire Jack Ma, founder of the online retail giant Alibaba, has been filmed trying to save food. A recent viral video shows him asking for his unfinished crab and lobster to be boxed up to go. As China is home to 1.4 billion people but the country is far from self-reliant. It imports 20 per cent to 30 per cent of its food grains. China was the world’s top agricultural market between 2003 and 2017, its food imports have grown from $14 billion to $105 billion from the top-10 import partners alone, China imports food worth $75.3 billion. It imports $22.7 billion worth from Brazil, $18.1 billion from the United States, $5.6 billion from Canada, $5.35 billion from New Zealand, $4.3 billion from Indonesia, $4.13 billion from Thailand, $3.37 billion from Hong Kong and $2.84 billion from France, according to 2017 data. China’s total agricultural imports from India in 2018-19 was worth $1999 million, major imports included prawns, castor oil, capsicum etc. 

China has spoiled its  bilateral relations with those nations on whom it depends for its food. The United States, Canada, Australia, New Zealand, India, Vietnam to  Indonesia are among the top exporters of agriculture commodities to China. China’s Commerce Ministry said in June that Brazil, Canada, Thailand, Vietnam, Cambodia, Russia and other key producers of wheat, soybean and rice had all cut their exports, including to China, to first replenish their own stocks. Despite its dispute over tariffs with the U.S., China still remains heavily dependent on the United States to meet its food demand. China’s agricultural imports in 2019 were pegged at $13.8 billion (USD), up from $9.1 billion in 2018, according to the U.S. Department of Agriculture. Even during the first quarter of 2020, China imported farm products from the U.S. worth $5.08 billion, while its exports dropped by 17.2 percent in January and February and 6.6 percent in March.

Beijing banned agricultural products from Australia over its demand for an independent inquiry into the COVID-19 outbreak. Similarly, farm trade with Canada, New Zealand, Indonesia and India are in the doldrums over different issues, including the potential security threat from Huawei and border skirmishes. China’s food shortfall will only get worse in coming years.

Hu Xingdou, an economist with the Beijing Institute of Technology, questioned given Beijing’s souring ties with the West and its depleting foreign exchange reserve as a result of a trade war with the United States, how Beijing would be able to buy enough food to feed the 1.3 billion people if domestic production could not be improved.  Hu said China’s food self-sufficiency rate should be increased from the current 80% to at least 90%. Liu Xiaobo, an influential financial columnist on WeChat and Weibo, also told that even though rice was the staple food for most Chinese, China still imported close to 100 million tonnes of soybean to produce cooking oil and feedstuffs amid the nation’s stronger appetite for beef, chicken, pork and lamb. Zhou Xuewen, Undersecretary for Emergency Management and chief of the State Flood Control and Drought Relief Office, said in July that “not a single grain was reaped” from about 11.4 million hectares of farmlands in southern China due to the devastating Yangtze flooding. 

Before Pandemic China, in order to meet growing domestic food consumption, resorted to buying agricultural land abroad. China targeted many countries, particularly in Southeast Asia, Latin America and Africa. Chinese companies in the agricultural sector invested in cereals, soybeans, orchards and livestock breeding in Argentina, Chile, Brazil, Mozambique, Nigeria, Zimbabwe, Cambodia and Laos. In Australia, the largest ranch in the world passed in Chinese hands in 2016, acquired by the real estate company Shanghai CRED. In New Zealand, Chinese companies bought dozens of milk and dairy farms. Ukraine, leased 3 million hectares of agricultural land to a Chinese company in 2013 and in France, China bought vines and acquired 1,700 hectares of cereal crops in central France. As per an estimate. Chinese investments in agriculture abroad is $ 94 billion in this decade. But the Pandemic Natural and Manmade disasters have caused a Food Crisis in China?

Fishing and Sea Food

According to Zhang Hongzhou, from Nanyang Technological University in Singapore “For China’s leaders, ensuring a steady supply of aquatic products is not just about good economics but social stability and political legitimacy.” China is not only the world’s biggest seafood exporter, the country’s population also accounts for more than a third of all fish consumption worldwide. Having depleted the seas close to home, the Chinese fishing fleet has been sailing farther afield in recent years to exploit the waters of other countries, including those in West Africa and Latin America, where enforcement tends to be weaker as local governments lack the resources or inclination to police their waters. Most Chinese distant-water ships are so large that they scoop up as many fish in one week as local boats from Senegal or Mexico might catch in a year.

Many of the Chinese ships combing Latin American waters target forage fish, which are ground into fishmeal, a protein-rich pelletized supplement fed to aquaculture fish. The Chinese fleet has also focused on shrimp and now endangered totoaba fish, which are much prized in Asia for the alleged medicinal properties of their bladders, which can sell for between $1,400 and $4,000 each. Nowhere at sea is China more dominant than in squid fishing, as the country’s fleet accounts for 50 to 70 percent of the squid caught in international waters, effectively controlling the global supply of the popular seafood. At least half of the squid landed by Chinese fishermen pulled from the high seas is exported to Europe, north Asia and the United States.

The government has robustly subsidized the industry, spending billions of yuan annually. For over a decade, the Chinese government has helped pay to construct bigger, more advanced steel-hulled trawlers, even sending medical ships to fishing grounds to enable the fleet to stay at sea longer. The Chinese government supports the squid fleet in particular by providing it with an informational forecast of where to find the most lucrative squid stocks, using data gleaned from satellites and research vessels. Chinese fishing boats are notoriously aggressive and often shadowed, even on the high seas or in other countries’ national waters, by armed Chinese Coast Guard vessels. From the waters of North Korea to Mexico to West Africa, incursions by Chinese fishing ships are becoming more frequent and aggressive.

China’s fishing industry employs more than 14 million people, up from five million in 1979, with 30 million others relying on fish for their livelihood. “The truth is, traditional fishing grounds in Chinese waters exist in name only,” says Mr. Zhang of Nanyang University. 

So Chinese fishermen are sailing farther to exploit the waters of other countries, their journeys often subsidized by a government more concerned with domestic unemployment and food security than the health of the world’s oceans and the countries that depend on them. And by some estimates, as many as two-thirds of those boats engage in fishing that contravenes international or national laws. China’s distant-water fishing fleet has grown to nearly 2,600 vessels, with 400 boats coming into service between 2014 and 2016 alone. By some calculations, China has anywhere from 200,000 to 800,000 fishing boats, accounting for nearly half of the world’s fishing activity. Most of the Chinese ships are so large that they scoop up as many fish in one week as Senegalese boats catch in a year, costing West African economies $2 billion a year, according to study published by the journal Frontiers in Marine Science. Overall, government subsidies to the fishing industry reached nearly $22 billion between 2011 and 2015. “Chinese fleets are all over the world now, and without these subsidies, the industry just wouldn’t be sustainable,” said Li Shuo, a global policy adviser at Greenpeace East Asia.

Indonesia has impounded scores of Chinese boats caught poaching in its waters, and in March last year, the Argentine authorities sank a Chinese vessel that tried to ram a coast guard boat. The recent discovery by the Ecuadorean navy of a vast fishing armada of 340 Chinese vessels just off the biodiverse Galápagos Islands stirred outrage both in Ecuador and overseas. Violent clashes between Chinese fishermen and the South Korean authorities have left a half-dozen people dead. With Japan it is a regular affair. For Beijing, the nation’s fleet of fishing vessels has helped assert its territorial ambitions in the South China Sea. In Hainan Province, the government encourages boat owners to fish in and around the Spratlys, the archipelago claimed by the Philippines, and the Paracel Islands, which Vietnam considers its own. In one way or the other at the cost of another Nation’s Marine Food are sealed by China.

Pablo Guerrero, marine conservation director for WWF Ecuador has explained how the Chinese Work in Seas “These boats operate without observers on board, they do not return to port, they transship their catch to mother vessels, which land the catch at ports. So, in a nutshell, they are fishing all the time, the fishing operation doesn’t stop.” The fleet is a vast and complex network. Among the hundreds of vessels are fuel providers, fishing boats, tender boats and reefers, some of which camouflage unregistered boats, Guerrero says. Many ships spend long periods at sea where shocking human rights violations have been reported. 

China hauled up about 15% of the world’s reported fishing catch in 2018, according to the UN fisheries agency, more than twice the second- and third-ranking countries. The UN’s Food and Agriculture Organization (FAO) estimates that illegal fishing has an annual cost of up to $23bn. The FAO also calculated that nearly 60 million people worked in fishing or aquaculture in 2016, 85% of them in Asia. But that majority would be from China.

China’s “Malacca Dilemma”

The United Nations Conference on Trade and Development (UNCTAD) estimates that roughly 80 percent of global trade by volume and 70 percent by value is transported by sea. Of that volume, 60 percent of maritime trade passes through Asia, with the South China Sea carrying an estimated one-third of global shipping.  As the second-largest economy in the world with over 60 percent of its trade in value traveling by sea, China’s economic security is closely tied to the South China Sea.  Eighty percent of China’s oil imports come through this vital passage.

China, which now imports over half of its oil, must transit an estimated 70 to 85 percent of its imported oil supply through Malacca from Venezuela and oil-rich nations in Africa and the Middle East. The PRC’s dependence on Malacca gives rise to security concerns because the surrounding region is vulnerable to disruption that could block maritime traffic and a substantial portion of the PRC oil supply. Acts of piracy, oil spills, shipping accidents and border disputes would all disrupt traffic through the Strait where China can be contained.

Conclusion

China is doing a Historical Mistake like the Wuhan Virus, it is not informing the World about the real Food Crisis. From Food to Meat to Fish it has shortages. China because of its aggressive foreign policy and trade wars Countries are refusing to engage. 

In China Food security is one of the oldest concerns of the Chinese Communist Party. Millions starved to death in the famine of the late 1950s to early 1960s during Mao Zedong’s rule. Many who survived remember eating tree bark or grass to get through. Early leaders identified food shortages and economic downturns as possible triggers for public uprisings. 

The Communist Party’s most severe political crisis to date, the 1989 Tiananmen Square pro-democracy protests, took place in a period of runaway inflation and economic malaise that bred popular discontent. 

With no Marine Resource China is taking other Countries’ Food. With the weakness of Energy and Trade it is acting to conquer and rein World. However as President Xi Jinping has told his citizens to tighten their belts and not to waste food. If the crisis goes further to distract he may go for some crisis with India or Taiwan or South East Asia. 

But for Chinese People the Regime change can start from the Food Crisis where we had seen instances in which they are prepared to fight. Cai Xia, a former professor at China’s elite Central Party School, accused Xi of “killing a country” and said “under the regime of Xi, the Chinese Communist Party is not a force for progress for China. In fact it is an obstacle to China’s progress.”

After a speech Cai made criticizing Xi leaked online, the party expelled her. She has since left China and said there is widespread opposition within the party, but few dare to speak out. The Regime Change can trigger anytime….for now Food Marine Products and Trade & Energy are part of life in China.