Frederick W Stakelbeck Jr. has written for us on national security issues, particularly on China. He has a pair of recent articles well worth reading. The first, in the Asia Times, examines the serious need in China for a credit—reporting agency. The lack of such nuts and bolts features of a market economy could spell enormous trouble.

The second article reveals a virtually unreported but highly significant rapid warming of relations between Mexico and China. Mexico, it seems, has given up on trying to compete head—on with China for manufactured exports to the American market. Instead, it wants to play a role as facilitator and gateway, invoking Singapore as a model. Rather inappropriately, in my view, since Singapore relies on efficiency, reliable courts, and the flexibility its small size offers. Stakelbeck notes:

The realization that Mexico can not compete with China in the U.S. exports market, coupled with a desire to become part of China's global economic rise, has motivated Mexico City to reach out to Beijing. Mexican President Vicente Fox recently commented, 'The two countries are cooperative partners, not competitive rivals, and the development opportunity for bilateral ties outweighs frictions.' In this regard, a 'Twenty Year Plan for the Future' was recently formulated by a permanent bilateral committee established to promote the development of improved relations.

The walls separating China and Mexico are slowing coming down. China is now Mexico's second—largest trading partner behind the U.S. Direct flights between China and Mexico have begun and Mexican tourism officials are anxious to tap into the Chinese travel market. Some estimates put the number of Chinese citizens expected to travel overseas in the next 15 years at 300 million. For the Chinese, President Hu Jintao's visit makes economic sense, since Mexico is now the second largest developing country next to Brazil in the Western Hemisphere.

But it is national security which offers the greatest cause of concern:

Recent actions taken by Beijing have made it clear that its traditional 'hands—off' policy concerning the Western Hemisphere is being dramatically revised. One of the main catalysts for this revised strategy has been China's enormous energy needs which are forcing the country to identify and secure resources all over the globe....

 

As the U.S. tries to maintain a foothold in Central Asia and the Middle East, China is making tremendous progress in the Western Hemisphere. Along with Venezuela and Cuba, China has made Mexico an important part of coordinated Latin American strategy sending an unmistakable signal to Washington that it plans to set up shop in America's backyard. Washington should be concerned about the possibility that Mexico may one day perceive China as an ally comparable to the U.S. As events unfold, it would be wise to remember the words of Russian communist leader Vladimir Lenin who stated, 'The road to America is through Mexico.'

Serious stuff.

Thomas Lifson   10 19 05