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| Factory on Fire in Vietnam |
China, being big brother China, the Center of the World China, is now keen to assert her sovereignty over the disputed territories in the South China Sea in a forceful and unambiguous manner.
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| Chinese oil rig Haiyang Shi You 981(C) is seen surrounded by Chinese Ships |
China had calculated that the Vietnamese probably couldn't do much. Yes, the usual diplomatic protests, but that would be about it. After all, the Vietnamese don't have have much military clout to start. This was woefully demonstrated in the search for missing MH 370. The Vietnamese Navy is small and somewhat antiquated. For a country with the length of her coastline, Vietnam has just 7 Frigates of which 5 are extremely old (Petya Class light frigates, designed in the 1950s and build for Soviet Navy in the 1960s) as well as 2 newer Gerpard 3.9 Class Frigates (delivered in 2011).
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| Sea-worthy? |
Such an attitude towards Vietnam is not new. Few may remember the 1979 Chinese invasion of Vietnam (the brief Sino-Vietnamese War). China launched this offensive in response to Vietnam's invasion of Cambodia in 1978. It was a punitive mission by the Chinese - to punish the Vietnamese for not "kow-towing" to China's might. After capturing a few border cities, China pulled back.
Fast forward till today, China can afford to be even more recalcitrant with her Southern Neighbour. Why? Chinese economic might has grown tremendously in the past 3 decades since 1979. Vietnam has fallen back far behind. China, still Communist in name, is in reality one of the most capitalist countries in the world. Its economic dominance can also be seen by the huge rise of a very rich upper middle class who are now investing in prime property all over the world, including London and New York.
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| They are rich, and there are so many of them. |
What Happened to Vietnam?
What happened to Vietnam from 1980 to 2014? Well, they are developing, but in relative terms China has pulled ahead in no uncertain terms.
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| Many motorbikes in Vietnam today |
Remember Deng's famous quote - "It doesn't matter whether it is a black cat or a white cat, as long as it catches mice." This is the supreme lesson in pragmatism.
China's Oil Rig
So, time to bully thy neighbour again. Plant a rig and watch the fun.
Lesson number 1 - In Life, The Strong Bully The Weak. Get Used To It.
Vietnam's Response Wasn't Too Bad In Theory
Now this part is exciting. Vietnam knew she couldn't do anything to stop the rig. If her Navy were stronger, perhaps she could send out her ships to harrass the rig and use all sorts of other tricks to impede the progress. But the Vietnamese Navy isn't capable of that, and China knows it.
So Vietnam decided to burn Chinese factories in Vietnam. Yeah baby, let the mobs and the hordes loose. Fuel their anger. It is a logical move. Vietnam was prepared to use civil unrest, within its own country, to try to make a statement to China. Burn their factors, hurt their private sector and state companies even if it meant that Chinese would cut back on investments.
Yes, Vietnam was desperate, I think. They couldn't think of any other way and decided to use this somewhat risky method. Either that, or they were foolish and didn't think through the consequences of using a mob of 10,000 people.
Lesson number 2 - Policy is only as good as execution.
The execution was utterly dismal. Turns out that their mobs and their hordes were either insufficiently briefed, or got carried away, or were just plain stupid that they indiscriminately burnt the factories they came across, including those belonging to countries like Singapore. Some reports indicate that they mistook
There is absolutely no reason at all why the Vietnamese Government would have asked their mobs to non-Chinese factories. It is shooting themselves in the foot many times over. But it happened. Why? We can only speculate what caused this snafu, but my pet theory is poor execution.
It could have gone like this. The top man could have passed down the orders to burn Chinese factories. The middle man told his ground commanders to rally the wokers to burn Chinese factories. The ground commanders rallied their troops and started to burn factories. Chinese or not? Who cares. Talk about careful target selection.
China Has The Last Laugh
I can only imagine the Chinese leadership falling out of their chairs, shrieking in laughter at the scale of absolute incompetence that their Vietnamese counterparts have shown.
Whoever proposed this daring ploy to place the rig would now be in line for a double promotion. Not only has the mission succeeded, it has had the knock-on effect of showing to the whole world how useless the Vietnamese Government and bureaucracy is. They can't even if organize a proper factor burning without burining the "correct" factories.
And The Joke Is Not Just on Vietnam
Lest we in Singapore think that this event has little impact on us, be mindful that the joke is not just on Vietnam, but on the whole of ASEAN. Be aware that China staged this provocation a week before an ASEAN summit. Who cares about ASEAN anyway. Check out this next blog piece, citing some sharp insights from the Economist magazine, where the "Asean Way" has been mocked.
Geez.
At the rate this is going, we'd all be speaking Mandarin-Chinese very soon.
我会讲华语,你会吗？
Happy Investing!
And just a couple of years ago, it is the Chinese, Taiwanese and Korean investors who said Vietnamese labor costs are so much cheaper. But the qualititative problems is unimaginable. I was nearly caught there too as my friends were setting up factories there. I chickened out last minute. Then I thought the red tapes and invisible expenditures were too risky.
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