14.03.2014 Author: Sofia Pale

China’s Global Expansion: Kingdom of Tonga as a Testing Site

544The early 21st century was marked by a number of conceptual notions: “globalization”, “clash of civilizations”, “East-West confrontation”… Later on, these terms were filled with more specific content. For example, the term of “new interventionism” denoted the U.S. military operations in Iraq and Afghanistan, as well as the operations of Australia in the Solomon Islands in the mid-2000s, aimed at seizing economic and political resources of the so-called “troubled states”.

Then there were the “orange”, “velvet” and “saffron” revolutions, and finally the recent “Arab Spring”, in which the almighty USA was allegedly involved.

However, all of these definitions apply to the politics of the West. Today we can see a different picture painted by China, which confidently pursues its policy of global expansion, using incentives that have not been used in the practice of the West. Western democracies base the concept of force primarily on military strength, but the “undemocratic” China bases it on delicate, rather friendly relations with the target country. Several years of silent contemplation of the Heavenly Empire’s actions have inspired a new life into the concept of “soft power”, born in the walls of Harvard back in the 1990s, to describe peaceful ways that allowed the hunter country to seize the “commanding points” in the economy and politics of the target country.

A simple example of uneasy relations between China and a small South Pacific country of Tonga can demonstrate how the target itself gets into the nets of the hunter. In general, the South Pacific Region (SPR), including 13 small island UN member states (including Tonga), gave Beijing a good opportunity to test its “soft power” in full, before an attack on larger and more developed countries. In fact, this attack is already being carried out, but so far, few people realize what results it will have in the near future.

Tonga, whose 100,000 population gained independence from Britain in 1970, preferring the monarchical form of government and the official name of “The Kingdom of Tonga”, retained close ties with Australia and New Zealand, which helped this tiny country to join the UN in 1999 (together with Nauru, with a population of 11,000 people, and Kiribati, with a population of 100,000 people). The new UN members immediately began to vote on the side of Australia; in particular, Tonga voted for brining American troops into Iraq in 2003, and even sent 45 its soldiers with the multinational force there (Australian contingent consisted of 400 soldiers, and New Zealand sent 60).

Back then, no one thought that in just a few years China would intercept the palm of victory in the “friendship” with Tonga.

Chinese capital poured into Tonga in 1998, when wealthy Chinese, who did business in Indonesia, were forced to flee the country after anti-Chinese pogroms. They were looking for quick ways to migrate to other countries – including using passports of Tonga. Since Tonga is a member of the British Commonwealth of Nations, the holder of such a passport has the right to visa-free entry to most of the Commonwealth countries, including the UK, and other developed countries such as Singapore and Hong Kong. In those years, Australia and New Zealand offered holders of Tongan passports the possibility of easy entry and obtaining residence permits in their countries.

Mainland Chinese also began to use passports of Tonga. In 1998, the PRC and the Kingdom of Tonga entered into diplomatic relations. The Embassy of Tonga was established in Beijing (by the way, China is still the only country in the world where there is an embassy of this island country, a diplomatic representation office in the form of the General Consulate of Tonga exists only in one country – in Australia).

While no more than 100 Chinese lived in Tonga in 1996, there were already 3–4 thousand of them in 2001 (i.e., 3–4% of the population). Then by 2005, the Chinese already owned 70% of private businesses in the capital city of Nuku’alofa, where the main part of the population is concentrated.

Mutually beneficial relationship between the Tongan government and the Chinese allowed the local political elite to enrich themselves. No wonder that riots and pogroms broke out in Nuku’alofa in 2006: government buildings and shops were damaged, a minor part of the shops belonged to relatives of the rulers, and the greater part belonged to the Chinese. A few Indian shops were also damaged. The Embassy of the PRC in Tonga organized an emergency evacuation for all overseas Chinese who wanted to leave the country. As a result, no more than 300 Chinese remained in Tonga.

Australia and New Zealand, which had almost lost their influence to China, had a chance to strengthen their position in Tonga once again. They offered the Tongans several thousand permits for seasonal work. As a result of this policy, the peak of economic prosperity of the country occurred in 2008, when almost all able-bodied people, who went to work in Australia and New Zealand, transferred almost $250 million into the local economy from there. This is a huge figure, when we consider that the amount of Tongan GDP is only $800 million. Tourism sector was another profitable sector: streams of the Australians, New Zealanders, Japanese, and … the Chinese, brought the country more than 60% of its budget.

However, the global financial crisis, which reached the financial “breadwinners” of Tonga in 2010, forced Australia and New Zealand to reduce the number of work permits. As a result, foreign transfers had dropped by almost a half by 2013, reaching a ten-year low. At the same time, there was a decline in the tourism sector – less Japanese, Australians and New Zealanders traveled to the country (but not the Chinese!).

Moreover, in 2011-2012, Australia, New Zealand and Japan, being busy with their own internal economic problems, significantly reduced their subsidies to Tonga. Only New Zealand remained the most interested partner of this island nation, but it also temporarily “turned away” from solving the financial problems of its “sinking” island neighbour.

On the background of a catastrophic economic situation, the government of Tonga was forced to turn to the only financially “unsinkable” state – the “yellow Chinese brother”. By the way, as far back as 1997, the Tongan Prince Tupou’toa (he is also Foreign Minister) said that “the Tongans are culturally and racially closer to the Chinese than to the Europeans”, and that “the Chinese are much more honest than those democrats who will receive what they really deserve one day”.

China treated the problems of Tonga with sympathy and understanding. During 2013, it fraternally allocated such amount of loans, subsidies and other material benefits to the Tongans that the country turned to be in an irredeemable debt to the Heavenly Empire, which fact was officially announced by the government of Tonga in early 2014. The debt was estimated at $325 million (i.e., almost 40% of the GDP), of which about 65% was owed to the Export-Import Bank of China.

In such conditions, the Heavenly Empire got the economy and, of course, the politics of Tonga at its full disposal. In order to remove the remains of New Zealand’s presence in the country, the Chinese government gave the Tongans two passenger aircraft (both made in China) in January 2013, and already in the spring, the New Zealand airline Chathams Pacific, which could not maintain price competitiveness, announced it was leaving the Tongan market. In response, the government of New Zealand refused to pay the promised multimillion-dollar subsidy to Tonga in the summer of the same year.

However, this was a mistake, as China immediately offered the Tongan government to place its naval base in the country. And if it receives consent, this will become the first military outpost of the Heavenly Empire in the South Pacific Region, which will have a convenient location near the French bases in New Caledonia and French Polynesia; near the major U.S. base on Guam; near the shores of Australia and New Zealand; and even “with a view” over Japan.

This is the way that China smoothly passes from the “soft power” to a rather tough attack. Everything starts with small and lucrative contracts for soft loans and assurances of fraternal friendship with a target country.

Now, those who sign such agreements on behalf of their state must clearly understand whether their country will be able to fully meet its debt obligations to the Chinese hunter.

Sofia Pale, PhD, Researcher at the Centre for Southeast Asia, Australia and Oceania, Institute of Oriental Studies of the Russian Academy of Sciences, exclusively for the New Eastern Outlook online magazine.

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