China: The Patient Dragon

China’s mercantilist strategy is patient. But will internal stresses and pressures force it to act?

I served in Afghanistan from 2002 to 2003, very early on. I had the privilege of leading the first multi-national team tasked with designing and building the Afghan National Security Forces. Therefore, I was in a prominent position to see what was happening across the nation-building effort and who was involved and how. Two countries made the biggest impression. First, Russia was there from the start, mucking about and creating chaos and confusion. They clearly wanted to derail our efforts. Second, China sat patiently waiting and observing events unfold in Afghanistan. I got the feeling then, and it has only strengthened since, that the country that would benefit the most from our foray into Afghanistan was China. They would wait patiently, making small moves to position themselves for contracts and resources.

China is like a patient dragon sitting on its hoard. From time to time, it sets out to add to it. It studies the environment and waits for opportunities, often caused by conflict. It is doing that right now with the Russian invasion of Ukraine. The dragon patiently observes, not committing to either side, but ready to pounce once they can plunder the situation as opportunities arise. It smiles hungrily while the west opens its coffers and weapons to Ukraine and Russia depletes its forces.

The dragon likewise patiently watches the changes in the US. It helped to plant the seeds of discord, or at least nurtured the seeds the Soviet Union planted in the 1960s and 1970s, when they funded the Black Panthers and academics. It watches the scourge of fentanyl tear apart American society and smiles. It remembers when Britain did the same to Chinese society with the Opium Wars. It understands the power opium has to wreck a society and destroy a culture. China took years to recover, but to the dragon, they were but a blink of an eye.

But like Smaug’s lair in the Misty Mountains of The Hobbit, there is an intruder in its hoard. It allowed the intruder in, thinking it could do no harm and it might turn the intruder to its own purposes. Foreign investors flooded into the hoard and the dragon tamed them and bent them to its own purposes. It extracted greater treasure from them in terms of technology and footholds in foreign countries, especially ports and resource extraction. The Economist reports foreign investors are now fleeing China. It even wonders whether China has become “uninvestible”.

If that is the case, will conditions force the Chinese dragon to take to the skies to pillage and prey? The likely target is Taiwan. If China senses that conditions in Ukraine provide an opportunity, will it fly off to Taiwan to spew death and destruction there to take its prize like Smaug attempted with Laketown in The Hobbit?

But is that target too hard at the moment? Bard the bowman brought down Smaug because a thrush whispered Smaug’s weakness into his ear and Bard was skilled enough to act upon it. Does the dragon understand this and avoid direct conflict and continue to use its corporations to do its bidding by buying Taiwanese and other companies while trying to continue to extract tribute from those that want to invest in China.

Or will it seek other prey in Siberia, where Russia’s hold over former Chinese lands is wavering. Will Russia dissipate her strength in a fruitless contest of Ukraine and provide increasing opportunities for the Chinese dragon in resource rich Siberia? Is the West so focused on Ukraine it does not see the long game elsewhere, to include its own backyard?

The Chinese dragon has some tough choices. Sitting in its layer watching and acting through subtle, hidden means, it remains above the fray and is able to deflect most observation as it lies wrapped in an enigma and obscured by encrypted language meant to seduce. With its patience and cloaked agenda, it brings treasure into its lair through guile and cunning. But the minute it strikes either Taiwan or Siberia, it will uncloak itself and potentially make itself vulnerable.

How patient can the dragon be? Internal stresses and lowered investments and tribute are placing stress on the hoard. Since the dragon is not transparent, as it lies wrapped in clever words and veiled threats, we cannot say for sure. But just as Smaug had a small opening in her armor, the Chinese dragon is not as strong and armored as it wants to appear. Its military strength is untried since the Korean War and it must wonder whether the same problems that Russia finds in Ukraine could plague it if the dragon takes flight.

We need more thrushes and hobbits in the dragon’s lair to better understand its strengths and weaknesses. We cannot trust a guileful dragon to speak clear truth.

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