The expansion of China’s infrastructure bank

In Yesterday’s Financial times, there was an article about China’s announcement to double the funding for it’s new Asian Infrastructure Development Bank (AIIB), from the $50B announced last month to over $100B.

This is notable in its own right; most of Asia and Africa are in desperate need of infrastructure investment.  But what was just as interesting to me is how the AIIB is being written about — it is a brilliant example of the filters our perspective imposes on how we view the world.  Digging deeper, I found three different articles about the establishment of the AIIB, one written by Bloomburg, one by the East Asia Forum, and one by Devex.  Each article was a good piece of news analysis, and each raised valid points worth considering.  But most notably to me, there was almost zero overlap between the three in the conclusions they drew.  In other words, forming a well-rounded view would be impossible by reading any of them alone.

The article in Bloomburg unsurprisingly takes an American slant: it paints the move as a geopolitical threat, which it undoubtedly is.  The somewhat sensationalist headline reads “China’s $50 Billion Asia Bank Snubs Japan, India”.  The AIIB will be a direct competitor to both the World Bank, which by unwritten charter always has an American president, and to the Asian Development Bank (ADB), which is funded by the US and Japan and is traditionally helmed by Japanese bankers.  During the recent recession, the US and western Europe have been scaling back their global infrastructure investments, while China has been rapidly expanding theirs, not just in Asia but in Africa and Latin America as well.  It is hardly surprising that China would be frustrated by their lack of ability to influence policy and priorities commensurate with their growing share of the world’s infrastructure investment portfolio.

The East Asia Forum article paints a rather different view.  It reads rather like a Chinese government press release: jingoism concealed within dry, technocratic, and tendentiously cautious prose.  An example, “If the new bank is managed professionally to finance commercially viable investments in economic infrastructure, it can begin to correct a very significant failure of global financial markets.”   But setting the bias aside, the analysis is a sound, cogent discussion of the business case for creating the AIIB and the challenges it can expect to face in fulfilling its mission.

un flagThe Devex article looks at the same news from the viewpoint of the international NGO and aid community.  Its headline “AIIB is coming… fast” draws the readers interest towards the potentially disruptive effect the AIIB will have on how NGO’s and aid organizations receive their funding.  Their analysis highlights that unlike the World Bank and ADB, the AIIB’s focus is on infrastructure rather than elimination of poverty.  They also call out that while the World Bank and ADB due diligence process includes social and environmental protections, the Chinese track record on environmental issues makes it unlikely that the AIIB will do likewise.

FigBashAnd what of my own filters? My own views are just as informed by my experiences and biases as the ones above.  As a believer in classical economics and as someone who has invested a significant portion of his career in working in the developing world, I view this as an almost unreservedly positive development.   Here is how I see it…

  • The world is desperately in need if infrastructure investment.  Even the World Bank, ADB, and AIIB combined won’t begin to satisfy the demand
  • The US and EU aren’t stepping up to the plate.  The US in particular is letting its own infrastructure crumble, let alone addressing the needs of the developing world. China is filling the void.  Here in Kenya, I have been told by bankers, policemen, and taxi drivers that infrastructure projects are first and foremost the government’s way of enriching its friends, but when they actually want something built, they bring in the Chinese
  • Competition is a good thing.  The World Bank is moribund and has no sense of urgency.  Paul Wolfowitz tried to do something about this during his brief stint as president, but was so tainted as one of the prime instigators of the Gulf War that his ideas were tossed out along with him.  A competitive threat, most particularly in the area of responsiveness and time to market, may be just the kind of wake-up call it needs.
  • The AIIB’s likely lack of concern for the environment is problematic, but the key is making the individual governments and the infrastructure projects themselves accountable; external political pressure on China has been spectacularly unsuccessful on most issues and is unlikely to be more successful here. Also, it is a mistake to think that improved infrastructure is automatically worse for the environment.  Lack of infrastructure can be just as damaging.  Look at Madagascar. Look at the Sahel.
  • Lastly and most importantly, the focus on infrastructure instead of directly on poverty elimination is a very good thing.  Aid programs are devastatingly unsuccessful.  Here in Kenya, it is estimated that less than 40% of the material aid that comes into East Africa actually reaches its intended recipients (more on what to do about that in a future blog post).  Time and again, I have seen first hand that the key to ending poverty is the commercial success of the impoverished.  Education is the number one factor enabling that success.  Financial inclusion is another key element.  But without access to infrastructure, the best skills and available capital will have nowhere to go.

Would love your thoughts

 

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Quartz – a new online news publication

I have for the past week or two been following the rollout of a brand new news publication called Quartz.  It is backed by the same company that publishes The Atlantic, and the small staff has an impressive journalistic pedigree.

The publication is targeted at and optimized for mobile phones, tablets, and readers first and foremost, rather than as an afterthought. The business model is radical, and by no means secure, as Jean-Louis Gassee points out in his delightful Monday Note blog. All of this is interesting to me intellectually as an observer of evolving media delivery models, but what has me excited is not the delivery method but the quality of the content.

This is some of the most consistently excellent writing I’ve seen in a long time.  The quality of analysis is on par with that of The Economist, but Quartz is not an attempt to imitate The Economist (if it were, I’d probably agree with their editorial position a bit more :-).  Their editorial positions are decidedly less guarded, but written from a position of confidence that feels like it emanates more from experience than ideological certitude.

Given the upcoming deployment, I have particularly been enjoying their series of articles on the impact of the world economic slowdown on China, as well as a recent piece on Bo Xilai, which I did not agree with but thoroughly enjoyed reading.

Have a look for yourselves, and let me know what you think

Ashima, a folktale from the Yi people of Yunnan

The Stone Forest, Yunnan Province

In the heart of the Stone Forest, a remarkable limestone formation about 60 kilometers from Kunming, is a very special stone called the Ashima stone.  Legend has it that this stone was once a beautiful woman named Ashima, which literally translates as “more precious than gold”.  How did she become a stone in the Stone Forest?

Ashima

China’s first color movie

There is a long epic poem that tells the story.  It is hundreds of years old, but was first written down in 1813. The legend of Ashima figures into local marriage customs, and was the subject of the first color movie made in China, in 1964.  The best English synopsis I was able to find comes from the University of San Francisco; it reads as follows:

 

 

Once upon a time, a girl was born in a poor Yi family. Yi people were one of 56 of the nationalities in China. The parents hoped the girl would be as beautiful as flowers and as shiny as gold. They named her Ashima.

When Ashima grew up, she was very beautiful. Many young Chinese men were attracted by her singing and dancing. But Ashima was in love with Ahei, who was a brave and wise young man. They were engaged to each other at one of the torch festivals for Yi people.

One day, when Ashima was on the market, she met the son (Azhi) of the village leader. Azhi thought Ashima was very pretty. He wanted Ashima to marry him instead of Ahei. Azhi was very rich, and Ahei was very poor. Still, Ashima loved only Ahei and wanted to marry him.

When the fall came, Ahei had to leave the village to work in the field. When he was gone, Azhi kidnapped Ashima and forced her to marry him. Ashima cried and insisted she loved only Ahei. This made Azhi very angry. He whipped Ashima until her whole body hurt. Still, Ashima believed Ahei would come to rescue her.

When Ahei heard about Ashima’s kidnapping, he rode his horse home without delay. When he got to Azhi’s door, Azhi would not let him in to see Ashima. Then, Azhi proposed a song contest with Ahei. The contest lasted for three days and three nights. Ahei won the contest, and Azhi had to open the door for him.

After the contest, Azhi asked Ahei to stay overnight in his house. He promised to let Azhi leave the next morning and take Ashima with him. However, it was a trick. During the night, Azhi unleashed three tigers to kill Ahei. But Ahei was ready for the attack, and killed the three tigers with three arrows. The next morning, when Azhi found all the dead tigers, he allowed Ashima and Ahei to leave together.

But Azhi did not give up. He wanted to kill Ashima since he could not keep her. When Ashima and Ahei were playing by a river, Azhi used his power to flood the river. Ashima was drowned. Ahei could not find her. He kept calling Ashima’s name, but he heard only his echo.

Ashima was turned into the river stones. Later, whenever Ahei missed Ashima, he would face the stones and call out Ashima’s name and talk to her. He always heard the echo of a response. In this way, Ahei lived with his beloved Ashima forever.

I am very much looking forward to visiting Ashima when we go to Kunming.  Who knows; maybe she will talk to us.

Photos from Wikipedia and china.org.cn

The Kunming Wolfdog

One of the group activities for Team China 18 this month is putting together an introduction pack for DOT to use in introducing our team to the communities we will be working with.  Each of us are supposed to provide a mix of professional and personal details about our lives that will help people to know us better.

In these slides, several of my colleagues have indicated a fondness for dogs; this got me wondering if there were any notable breeds of dog from Kunming.  And sure enough there is one.   So Brett and Renata, I give to you the Kunming Wolfdog.

The Kunming Wolfdog

The breed was started in the 1950’s in response to the need for a common standard of dog for China’s military and police corps.  In 1988 it was recognized internationally as a distinct breed.  The main antecedents are German Shepherds and a group of wolf-dog crossbreeds developed in Beijing, but there were also a number of house dogs of indistinct breed in the initial breeding pool; detailed pedigrees were not kept.

Physically, they strongly resemble German Shepherds, but their wolf heritage is evident in the taller rear haunches and in how they carry their tail.  They are a very active breed, and require significant exercise every day to stay healthy and happy.  The breeding guides all say that they require at least one long walk every day.

They are primarily working dogs and seldom kept as pets, though this may be changing over time.  But even though they are mainly working dogs, the breed is quite popular.  There is an annual dog show in Kunming every October that features the breed.  The 2011 show was held on October 15, so it is not impossible that we will be there at the right time.

The 2011 Kunming Dog Show

So there you have it.  The Kunming Wolfdog.  I shall keep my eyes posted during my visit for a glimpse of this very handsome looking hound.

Food of Yunnan 1: 过桥米线 – Crossing The Bridge Rice Noodles (guòqiáo mĭxiàn)

Amongst his observations of Yunnan and Kunming, Marco Polo noted that the people there were particularly fond of raw meat.  Like most people, I tend to associate raw fish with Japanese sushi and raw beef with Italian carpaccio or east European steak tartare.  Uncooked meat is frequently brought to the table in China, but only to be cooked there by the diners themselves; not once in all my visits to China have I encountered a dish in which meat is eaten raw.

Is the eating of raw meant something unique to Yunnan then?  Or have people simply outgrown their taste for it?  It has been over 700 years, after all.

Armed with curiosity, I resolved that I would spend the next part of my life dedicated to a deep, thorough, and comprehensive study of Yunnanese cuisine.  In other words, I googled around for about half an hour looking at some web pages. And while I didn’t find any dishes that resembled those described by Marco Polo, I did find many delightful things to share with you.

So without further ado, I give to you that most iconic of Yunnanese delights, Crossing the Bridge Rice Noodles, or 过桥米线 (guòqiáo mĭxiàn).

Most people seem to agree that the recipe for Crossing The Bridge Rice Noodles is somewhere between one and two hundred years old.  There is not nearly so much agreement on how it got its name, I found the most fully realized telling of the most common story on a food adventure blog published by a couple in Vancouver called Chowtimes, which I have reproduced below.  They in turn appear to have gotten it from a sign posted on the side of a food stall in Yunnan itself.  Like many Chinese translations the prose is quirky, and calls out the many grammatical differences between their language and ours.  But unlike many Chinese translations, I find that this passage loses none of its ability to communicate a sense of wonder and delight…

Cross Bridge Rice Noodle is a special dish of Yunnan. It is originated during the Qianlong period, nearly 200 years ago. There is a popular legend regarding its origins.

It is said that a scholar in Mengzi, who was preparing for the Imperial examination, went to an island in the Na Lake everyday to study. His wife went across the bride to the island to bring his meal to him. Owing to the long distance, he had to eat the meal cold everyday.

Accidentally, his wife discovered that a greasy chicken soup is not easy to get cold. What’s more, fresh ingredients, such as seasonal vegetable, fresh meat and so on, can become edible by putting them into this kind of boiled soup.

From then on, the scholar could have a delicious and hot meal everyday. Because his wife went across the bridge everyday, the rice noodle made this way was named as Cross Bridge Rice Noodle.

By now, the Cross Bridge Rice Noodle has a distinct development. The most important factor in this noodle is the soup. It was made with natural hen, pig bone and ham. It needs to be boiled for over 6 hours until the soup become savory and the oil from these are distilled.

The next thing worth mentioning is the ingredients. There are two kinds of rice noodles. The proper kind is the slim one, which is good at keeping the flavour of the valuable soup. The ingredients can be divided into two categories: vegetable and meat. The vegetable used are dependent on what is in season. The meat is focus on slice. The thinner the better, so the slice meat is one of the characteristics of the Cross Bridge Noodle.

Last but not least, the process of eating is special. The right orders are as follows: firstly, put the meat slice in the soup, then the vegetable, the last one rice noodle. Minutes later, a hot colorful and delicious Cross-Bridge Rice Noodle is ready.

So there, in authentic Chinese English, is the story of Crossing the Bridge Rice Noodles.  As you can see in the above photo, the final dish is built at the table by the diners themselves.  That is probably the thing I enjoy most about Chinese food in general; more than any other cuisine I know of, the eating of Chinese food is designed to be a social activity, shared with family, friends, and colleagues.  I cannot wait to come to Kunming and try it with my team.

Historical Kunming Part 1: Kunming and Yunnan as seen through the eyes of Marco Polo

Most places in the world are steeped in history, and that history often defines the culture of its inhabitants.  Nowhere is this more true than China, and the canonical history of civilization that we receive as  westerners is almost completely silent about one of civilization’s most dominant cultures, a heritage that far outdates ours in enlightenment and sophistication.  Every western traveler to China I have ever spoken with (myself included) is at some point daunted by a sense of how much of the story we have missed.

To ensure that my team and I miss slightly less of the story this time, I will be trying to learn a little of the history of Kunming, and of Yunnan province.  And as an interloping westerner, it seems fitting that I start with the story of the most famous interloping westerner of all, Marco Polo.

Marco Polo was a Venetian merchant who in 1272 at age 17, went with his father and uncle on what was supposed to be a 2-3 year trade mission to China.  He ended up serving in the court of Kublai Khan, and stayed in the Mongol dynasty for almost 20 years.  His eventual return was badly timed; he arrived in the midst of a civil war in 1292 and was imprisoned for a further seven years.  His loss was our gain; having nothing better to do, he narrated the story of his travels to a fellow prisoner, a French romance author named Rustichello.  Upon their release in 1299, Rustichello published those narratives, and while the original manuscript is lost, various translations of the original survive to this day.

In Renaissance Italy it was considered right and proper to boast of one’s accomplishments; failing to do so was interpreted as a sign of weakness and subservience.  And while Marco Polo himself is portrayed to be a man of utter pragmatism, Rustichello was a romance writer by trade and unabashedly used the tools of his trade to their greatest effect when telling the tale of Marco’s travels.  For both of these reasons, the truth of some of the stories in this book must be taken with a healthy degree of skepticism. There can be no doubt that Marco and his father and uncle did go the places they claimed to have gone; their accounts of these places and the events that took place during their visit rings true with contemporary Chinese accounts of the same events.  On the other hand, there is no evidence whatsoever to support the central role in these events or the high position in the Mongol court that Marco assigns to himself.  In fact there is almost no mention of Polo’s twenty-year sojourn at all in Chinese historical records, only the scantiest hints of indirect evidence.  Certainly a foreigner so highly placed as Polo claimed to be would not have escaped the notice of otherwise inexorable Chinese scholars.

Where Polo’s account really shines though, is in his descriptions of the places and people he visits.  Unlike his biographer Rustichello, there is not the slightest flight of fancy in his worldview.  He notices those things that a merchant would deem important.  What items of value a region produces. Which roads are safe.  The abundance (or lack) of grain or livestock.  The quality of their horses.  Their religion and system of government.   And above all, health and temperament of the people.

So here then with equal mix of fascination and skepticism, is Polo’s account of Yunnan and Kunming, as he encountered them in around in the year 1282 AD.

On the farther side of the river Brius  lies Kara-jang, a province of such size and wealth that it contains no less than seven kingdoms (Kara-jang was the Turkish name for Yunnan, and Brius for the Kin-sha-kiang, one of the sources of the Yangtze).  It lies towards the west; its king is the Great Khan’s son, whose name is Essen-Temur, a very great king and rich and powerful.  He rules his land well and justly, for he is a wise and upright man.

After leaving the river, the traveller continues westwards for five days, through a country with numerous cities and towns which breeds excellent horses.  The people live by rearing animals and tilling the soil.  They speak a language of their own, which is very difficult to understand.  At the end of the five days one reaches the capital of the kingdom, which is called Yachi (Kunming), a large and splendid city.  Here there are traders and craftsmen in plenty.  The inhabitants are of several sorts: there are some who worship Mahomet (this is how Polo refers to Moslems), idolaters (Buddhists), and a few Nestorian Christians.  Both wheat and rice are plentiful; but wheat bread is not eaten here because in this province it is unwholesome.  The natives eat rice, and also make it into a drink with spices, which is very fine and clear and makes a man drunk like wine.

For money they use white cowries, the sea-shells that we use to make necklaces for dogs:  80 cowries are equivalent to 1 saggio of silver, which is worth 2 Venetian groats, and 8 saggi of fine silver may be taken to equal 1 of fine gold.  They also have brine wells, from which they make salt that is used for food by all the inhabitants of the country.  And I assure you that the king derives great profit from this salt.  The men here do not mind if one touches another’s wife, so long as it is with her consent.

Before leaving this kingdom let me tell you something which I had forgotten.  There is a lake here, some 100 miles in circumference, in which there is a vast quantity of fish, the best in the world.  They are of great size and of all kinds.  The natives eat flesh raw — poultry, mutton, beef, and buffalo meat  The poorer sort go to the shambles and take the raw liver as soon as it is drawn from the beasts; they then chop it small, put it in garlic sauce, and eat it there and then.  And they do likewise with every other kind of flesh.  The gentry also eat their meat raw; but they have it minced very small, put in garlic sauce flavored with spices and then eat it as readily as we eat cooked meat.

Let me tell you further that this province produces a sturdy breed of horses, which are exported when young for sale in India.  And you must know that it is the custom to remove two or three joints of the tail-bone, so that the horse cannot flick the rider with its tail or swish it when galloping; for it is reckoned unsightly for a horse to gallop with swishing tail. The horsemen here ride with long stirrups after the French fashion. Long, that is, in contrast to the short stirrups favored by the Tartars and most other races who go in for archery, since they use their stirrups for standing upright when they shoot.

So there it is,  an excerpt from the first notes of Kunming made by a western visitor to China.  To go deeper into Kunming’s history, we need to do what we as historians should have done from the start: listen to the Chinese themselves.  Next week, I shall attempt to do just so.