New guide on social responsibility for Chinese contractors abroad

December 14, 2012

The China International Contractors Association released its Guide on Social Responsibility in September. The text, which is bilingual and clearly adapted to the lingo of international CSR, mostly sticks to generalities and exhorts companies to obey laws — for example, by paying taxes (article 4.7.3).

Nonetheless, some parts go beyond the language we have been used to. For example, article 4.2.1 recommends treating job applicants of “different ethnicites, genders, races, nationalities, age, religions, disabilities, marital status and sexual orientation equally.” Such language is unusual in China, and although hiring disabled candidates in the construction industry may not be very realistic, it is nonetheless a nice idea. The same article also advises against the use of child labour, but since this is illegal in China, it is already covered by the Chinese government’s requirement that Chinese companies abroad comply with Chinese as well as local laws. Article 4.4.3 recommends localised procurement, and article 4.4.2 advises incorporating CSR standards into subcontracting arrangements.

According to International Rivers’ (IR) useful guide to the state of China’s international dam building industry, The New Great Walls, an updated version of which has just been released, Sinohydro’s 2011 policy, developed in consultation with IR, goes far beyond these guidelines: it adopts the World Bank’s principles on infrastructural projects, mandates “community” consultation and access to social and environmental impact assessments, commits  to a dialogue with NGOs, and requires at least equal income and livelihood levels for those displaced by projects. It also required informed consent by “Indigenous Peoples” where applicable, an interesting fact as China is not a signatory to the UN convention on indigenous peoples and the term is not used in China.

According to The New Great Walls, there were “at least 308 dam projects … in 70 different countries” being built with the help of Chinese contractors or financiers as of August 2012.

White paper on foreign aid

April 29, 2011

China has published its first paper on foreign aid, or assistance (《中国对外援助》白皮书), in a further sign of its new policy to talk about aid specifically. The white paper is available on the website of the State News Administration (国新办).

The executive summary characterises China’s foreign aid as a form of “South-South cooperation” and claims that it constitutes a particular model of aid, although this is not defined beyond stating that it is based on “equality, mutual benefit, attention to effectiveness, moving with the times, no political conditions.”

The white paper says that, by the end of 2009, China had spent 106 billion yuan on grants-in-aid, 76 billion yuan on interest-free loans, and 74 billion yuan on concessional loans. It has also organised over 4,000 trainings in China for 120 thousand participants and dispatched 21 thousand medical personnel, including 60 teams in 2009 alone, and 10 thousand “aid teachers” (援外教师).

These are not the same as volunteers, which are discussed in a separate paragraph. According to the document, China first dispatched youth medical and teaching volunteers to Laos in 2002. By the end of 2009, it had dispatched 405 youth volunteers to 19 countries including Thailand, Ethiopia, Laos, Burma, the Seychelles, Liberia, and Guyana, with duties including teaching Chinese, practicing Chinese medicine, agricultural technical extension, computer training, and disaster assistance, as well as, through a separate channel, 7,590 volunteer Chinese teachers.

The document contains a description of the aid financing mechanism and states that the Ministry of Commerce has overall responsibility for it.

A curiosity is that Malta, an EU member, is listed among aid recipients: it benefited from the construction of a dry dock.

China’s Africa white paper

January 20, 2011

China’s State Council has published its first white paper on Africa. It largely repeats statements already published elsewhere. Nonetheless, Part 4, “Strengthening the development of capacity building,” is noteworthy as it reflects the entry of a concept that China has previously been accused of neglecting into policy documents. “Capacity building” here is understood as “educational cooperation” and vocational training. As an example, the text mentions rattan weaving courses for Liberians displaced in the civil war — a project of Western NGOs, but now also embraced by China. Another more conventional example is the dispatching of 104 agricultural experts to 33 African countries as of 2009. Also as of 2009, 312 volunteer Chinese teachers, doctors, teachers, sports coaches, IT trainers, and humanitarian intervention personnel have been dispatched.

Part 5 of the document deals with “Helping raise living standards.” This includes “cosntructing welfare facilities,” also a new item in the list of China’s activities abroad. But again, the interpretation of the term is different from what might be expected: constructing low-cost housing, drilling wells,  building water pipes and water treatment faciltiies, and even broadcasting and communication facilities.

New report on Chinese bauxite mining in Indochina

October 7, 2009

The Heinrich Boell Foundation, WWF and the International Institute for Sustainable Development have released a new report by Kate Lazarus on China’s involvement in bauxite mining in Indochina. Mining companies are present in Laos but have not yet started operations; in Vietnam they have so far secured construction contracts, but even that has  attracted opposition and the government may backtrack; whereas in Cambodia they have so far only been involved in road building on the Bolaven Plateau that has coveted bauxite reserves. The report points out the synergy between highly energy-intensive aluminium smelting and the development of hydropower.

The report can be downloaded here.

International Crisis Group’s new report on China-Burma relations

September 19, 2009

Following the conquest of Kokang by Burmese government troops and the reported flight of tens of thousands of refugees to China (described as Chinese businessmen in Chinese media; see earlier entry), the International Crisis Group has published a new report entitled China’s Myanmar Dilemma. The report suggests that there is a conflict of interest between Peking, which supports the Burmese government, and the Yunnan provincial government, whose primary interests lie in maximizing profits from border trade and which hence prefers to deal with the so-called “ceasefire armies” and keep the Burmese government at arm’s length. Many Burmese border towns rely on China for electricity, water, and telecommunications, which of course also provides China a powerful weapon: thus, after a series of abductions of gamblers in early 2009, the Yunnan government cut off utilities to the casino town of Maijayang to pressure the local authorities to shut down the casino. The closest relations are maintained with the 20,000-strong United Wa State Army: in March, a Yunnan Province official participated in the 20th century celebrations of the UWSA’s victory over the Communist Party of Burma (!), and its political leader, Bao You-Xiang, epxressed its thanks to China for its support. At the end of last year, both Kachin and Wa leaders wrote a letter to Hu Jintao appealing for investment and aid.

The report also details Chinese involvement in hydropower projects (at least 63, including the Tasang Dam on the Salween, which is to be the largest dam in Southeast Asia) and mining (the latest and largest project, the Tagaung Taung nickel mine, was approved in 2008 with an investment of $800 million). Official Burmese figures say that 99% of the foreign investment in 2008, or about $900 million, came from China.

While the authors of the report seem to have had privileged access to officials in China, parts of it — particularly those describing on-the-ground sentiments — appear to be based on flimsy evidence. Thus, in reporting on anti-Chinese sentiments in northern Burma, statements like “Burmese feel that they are being pushed out” and “It has been estimated that 60 per cent of Myanmar’s economy is in Chinese hands” are based on a single interview.

It is tempting to see the “special zones” in Northern Burma as a return to the “overlapping sovereignty” of precolonial times when many of the principalities in the region paid tribute to China but were under the loose military control of Burma. What continues to interest me is the role and conceptualisation of Chinese ethnicity in these borderlands today. Do people like Bao You-Xiang see themselves as Chinese, Wa, or both? And how are they seen by others?

“Timor-Leste: The Dragon’s Newest Friend”

May 26, 2009

A report on China’s relations with East Timor, by Loro Horta, has been published by the French institute IRASEC
 as Discussion Paper no. 4 (May 2009). It seems to be a standard “realist” IR kind of text, about foreign policy influence. What makes it interesting is the biography of the author:

Loro Horta is a graduate of Peoples Liberation Army National Defense University (PLANDU). Previous to his Chinese education he was educated in Australia, the United States and Singapore. His […writings] on the Chinese military and other China related topics have been published by the Military Review, Australian Army Journal, Strategic Analysis the Center for Strategic and International Studies, Washington D.C, and Yale Magazine.

International Crisis Group report on Chinese peacekeeping

April 19, 2009

The International Crisis Group has released a report called China’s Growing Role in UN Peacekeeping. The report is largely positive and recommends that China develop a peacekeeping policy and that other countries actively encourage China to contribute more troops to peacekeeping. It also notes that

China’s relationships with problem regimes in the developing world have fed suspicions that its peacekeeping is motivated by economic interests. In fact, China’s economic and peacekeeping decision-making tracks operate separately, and tensions between the foreign affairs ministry, military and economic actors mean there is no overall strategic approach to peacekeeping.

Heinrich Boell Foundation study released

February 4, 2009

The study by the Heinrich Boell Foundation, Rethinking Investments in Natural Resources: China’s Emerging Role in the Mekong Region, which I wrote about in my 15 December post, is now available online. Versions in Chinese, Vietnamese and other languages will also be available, according to the foundation. The study is a useful summary of information on the subject.

Social responsibility guidelines for Chinese banks

January 24, 2009

The Chinese blog of International Rivers reported that the China Banking Association published a set of social responsibility guidelines for its members on 12 January. (A full translation has since appeared on their English site; the quotes below are my translations.) Article 20 specifies banks’ obligations towards the projects they finance:

Banks and financial institutions, through credit and other financial instruments, should support clients in conserving resources [and] protecting the environment; guide and encourage clients in increasing social responsibility awaraness […]; actively train clients in environmental protection; trainings should include, but not be limited to, concrete procedures for environmental impact assessment. […] It is encouraged to conduct independent assessments of projects’ environmental impact; decisions cannot be based solely on the environmental impact assessment reports or other documents submitted by the client.

This is of course already a legal requirement in China, so let us see whether it will now be enforced for international projects. No similar requirements refer to social impact assessment, and only this article refers to safeguards for lending. The rest of the document refers to measures to be taken by the banks within their own organisations. Like other documents on CSR coming out of Chinese state institutions so far, it is strikingly different from what this term covers in Western parlance and fits more into the state discourse of “harmonious development” (which, according to Article 1, the document intends to serve). 

Thus, Article 3 defines social responsibility as “economic, legal, moral and charitable responsibility to shareholders, employees, business partners, government and community.” It is not something that has to be considered additionally to and possibly in conflict with business interests and legal obligations, but rather their expansion.

The rest of the document details these responsibilities in a vague and tautological fashion, without proposing standards or measures. Thus, social responsibility is said to entail “actively protecting the social public interest [sic] of consumers, workers, and the community masses in accordance with the requirements of social morality and public interest; promoting charitable responsibility, actively throwing oneself into activities for the public good” (Article 3, Section 2).

Articles 6 to 10 discuss “Economic responsibility;” this includes “opposing unfair competition,” “protecting the interests of shareholders, especially medium and small shareholders;” “creating value” for shareholders and employees; and protecting consumers. Articles 12-15 deal in more detail with “Social responsibility.” This includes educating consumers, popularizing financial knowledge, “promoting ‘people at the centre’ [the current Party leadership’s slogan], taking employees’ health safety to heart, caring about employees’ lives […] fanning employees’ work enthusiasm, initiative and creativity. It also includes “supporting the economic development of the community, […] enthusiastically donating for charitable and volunteer activities, […] making an effort to build social harmony and social progress.”

The final articles propose that banks audit their own social responsibility and report on it.