Emerging Signs of New Imperialist Equations, And a New Fascist Block

Barnali Mukherjee

New Giants

Putin, in sheer desperation is hoisting a red flag on his war tanks, maybe to confuse and woo the democratic peace-loving people of the world. But with seven months in aggression, they are still without any favourable outcome. On the contrary, Ukraine is gaining ground and Putin the dictator has already imposed partial mobilisation on his own citizens. On the other hand, even after much hue and cry, China could not manage to impose war on Taiwan. It seems that the PLA is reluctant to start the war, after observing Russian damage and catastrophe. Moreover, Biden has already announced that hurting Taiwan will be understood as a war against America itself. It’s quite obvious that the PLA will not take such a big risk, and if necessary, may dislodge Xi Jinping.

But these features do not allow the USA to stay assured. It is clear that the US imperialist hegemony is facing a severe competition. A new block is rising. The two major ex-communist countries along with Iran seem to be potentially the new imperialist (fascist) contender to the NATO block.

The five features of imperialism as outlined by Lenin are more or less true for Russia and China. GDP per capita of China is just around 12000 dollars in comparison to the US 69000, but its economy is fast approaching the USA’s. According to a World Bank report, China’s GDP was 11% of the US in 1960, but in 2019 it is 67%. China’s economy at only 6.2 trillion dollars behind the USA’s in 2021, was 7.3 trillion behind in 2019—which is an indication that China’s monopoly capital is getting stronger. With such a high population, GDP per capita going to catch up in an increased rate has no other meaning. It’s obvious that Chinese monopolies are making headway in the world market. To name some, Alibaba, Huawei, Legend Holding (Lenovo, acquired the personal computer division of IBM), ZTE, Tencent, TCl and so forth. The global list for 2022 showed 145 Chinese companies contributed 31 percent of the total revenue of the world’s 500 largest corporations. And the 124 US companies in the list accounted for 30 percent.

Russia still enjoys monopolies in war business, gas and oil and they are part of the Russian finance capital chain. That Russian finance capital is a major contender to the USA finance capital can be seen after sanctions on the giant banks of Russia after the Ukraine war. Gazprom bank was founded in 1990 by Russian natural gas giant Gazprom (GAZP) to provide banking services to the energy industry. Gazprom bank reported assets of $101.8 billion as of year-end 2020 at the exchange rate prevailing at the time. While sanctioning VTB, which is listed in Moscow Exchange, US treasury commented, “it will sever a critical artery of Russia’s financial system”.  Promsvyaz bank, which was nationalized in 2018 and turned into a lender to the Russian defense industry, has also been sanctioned for obvious reasons. But serious incidents have been reported and questioned by international media. Why is it that 6 senior officers of GAZPROM, the gas company which was reluctant to stop gas supply to Europe, and two officers of Russian oil oligarch LUKOIL (which expressed its concern on Ukraine war openly) have been reported serially dead? 

Notwithstanding the creation of the Silk Road Fund and the Asian Infrastructure Investment Bank (AIIB) (both announced by the Chinese government in 2014, linked to the BRI) the large majority of BRI projects have been funded by the Chinese policy banks (China Development Bank and Exim Bank of China). Now coming to the capital export feature, the whole world is concerned about China’s Belt and Road Initiative, already defamed as a debt trap ‘diplomacy’. As Vladimir Lenin pointed out, to the numerous old motives of colonial policy finance capital had added the struggle for the sources of raw materials, for the export of capital, for spheres of influence, that is, for spheres of profitable deals, and finally for economic territory under control in general. Added information to satisfy all the features of imperialism, in July 2007, China set up its first military base in Africa, Djibouti. To ‘protect’ China’s investments in Africa it is taking military initiatives to ‘resolve’ unrest in South Sudan and Mali, says Wikipedia. China is taking over big mountains, lakes, mines, etc. in Africa as payment of debt. In 2020 China has surpassed the USA as the largest trading partner with Africa, informs Wikipedia.  The military initiatives of China in Sri Lanka, in the name of ambushing LTTE will be discussed later, in this article.   

That the USA had to bow down before the Taliban was not just a defeat, it was a sign of their defeat in front of the fascist rising forces. Xi Jinping has transformed himself into a lifetime president, by changing the Chinese constitution. Putin has done the same. Although the USA did not venture into a direct war in Ukraine against Russia, NATO has been supporting Ukraine financially and with ammunition. It’s idiotic to say that is sheer business, because no borrowing is to be given back if Ukraine loses. Thus, it presently is aid. But that the USA is going defensive has sent alarms throughout Europe, as their cruel winters depend on Russian gas and Ukrainian bread too much. Still, the UK’s new prime minister, Liz Truss, seems as determined as her predecessor to help Ukraine, but the EU has not notified any further aid. Whereas US President Joe Biden is to seek 11.7 billion dollar (£10 billion) as emergency funding from the Congress in further aid to Ukraine. The EU has already passed at least six packages of sanctions, but Ukraine is asking about when the next official set of measures may appear.

Debt Trap—the Design

The bankruptcy of Sri Lanka, the imminent possibility of Pakistan going bankrupt, Russian aggression of Ukraine, the 2018 US threat to IMF (“Make no mistake, we will be watching what the IMF does,” Pompeo stated in an interview to CNBC), PM Narendra Modi’s fifty foreign tours, PM Hasina’s statement that the Padma bridge was not built by China—all these political phenomena can surely be threaded together. The equations of imperialism are changing. A new war-monger imperialist axis is taking shape—Russia in Europe, China and North Korea in Asia and their abettors, the Taliban and Iran, all in a silent alliance. The Russian economy has so long been based on export of war. China has gone far ahead in the same direction for quite some time. Capitalism, hungry of war, has been gasping for a new life since 2009.

In 2013 China adopted the Belt and Road Initiative (BRI). That they had become a great rival could be realized when even the US-controlled IMF got into partnership in that project. China-IMF Capacity Development Centre (CICDC) is a new IMF centre funded by the Chinese government to provide training and other capacity development activities for China and other IMF member countries, including those participating in the BRI. In this joint forum panegyric was sung for China’s greatness. It was discussed how this project would provide numerous countries with opportunities to utilize Chinese wealth. This much could be comprehended that the IMF was ready to take the liabilities of this risky project. It was clearly discussed that the participating countries would be enmeshed in debt. “Fiscal management will be critical to minimize debt sustainability risks. For China, it will be important to monitor credit risk exposure, both in direct lending (government) and indirect (state-owned banks and funds).

On the other hand, Modi is pretending to take a position, neutral of any alliance, though the desire to take to the side of Russia is distinct. In the matter of the Ukraine war India maintained an awkward silence in the UN. But India has adopted a policy of moving cautiously – not with an eye to the US but being afraid of China. It is not easy to side with China in Asia. With the prospect of a Russo-Sino-Afghanistan-Iran axis becoming a reality, China will stand face to face against India in Asia.

On 25July 2022, the much-desired Padma-bridge was inaugurated in Bangladesh. The government of that country broke the news that the Padma Bridge was not at all a part of the Chinese BRI. It is known to everybody though, that the organisation which has built the bridge is a Chinese engineering concern. As the IMF did not give any loan, Bangladesh herself spent Tk 94 billion. But the real point is that after Pakistan, the second biggest importer of arms from China is Bangladesh. Without dependence upon war merchandise, only debt-trap cannot explain any change in equations. And already Sheikh Hasina has invented a new definition of humanity to justify the aggression of Ukraine by Russia.

In Pakistan, no elected statesman had ever been able to complete his/her own term. Before the completion of five years, he/she was either killed or removed in a military uprising. Before Imran only two Premiers were sought to be removed through no-trust moves – Benazir Bhutto and Shaukat Aziz. Both the attempts failed. Their governments survived. Before the next elections though, both were removed by non-parliamentary means. Nawaz Sharif has had to live in exile in a foreign land. Also, military chiefs met the fate of ‘accidental’ death or exile. In comparison, Imran has been removed by great civil means, following the norms of parliamentary democracy. Nor has he been arrested so far on any allegation of murder or robbery. However, Imran had already been charged of terrorism, and the arrest threat is gaining ground. But the situation in Pakistan perhaps does not allow the new Prime Minister and the military to display any greater arrogance than this.

Pakistan is well enmeshed in a debt-trap. After Sri Lanka, it is now their turn. Pakistan has indeed gone bankrupt – only a formal declaration is due. According to the accounts as of the month of June, Pakistan had a stock of foreign currency sufficient to afford import for two months more. Even the financial institutions are averse to giving loans to the government. Most of the consumer-goods used by the people there are imported from abroad. As a result, the life of the nation will crumble for want of foreign currency. Moreover, revenue could not be collected during the pandemic. Under capitalism it is so, in general. In a crisis the government imposes taxes on the businessmen. Foreigners withdraw money from the share-market and flee to other countries. The native also re-collect money from the market. In India too, a great deal of money has been taken back from the stock market by the capitalists before going abroad during the last six months.  In Pakistan, to keep the supply of foreign currency in motion, one more round of borrowing from the IMF has been committed. In this round their terms are harsher. The subsidies in force in different sectors are to be done away with. Besides, the audit of the pandemic loan received by the Pakistani government has to be provided. Such conditions as withdrawal of subsidies on petroleum commodities, raising the cost of electricity—all these are there as a routine.

During the pandemic the Pakistani government adopted a widespread programme of cash transfer. In addition, universal vaccination, governmental help in large-scale production – all these together weakened the exchequer gradually. There was no growth of production, nor did the number of taxpayers rise. Like India, those who can pay tax are being appeased. Consequently, the exchequer was not filled.  All money found its way to the coffers of the rich and the powerful. On another plank, the Ukraine war and the volatile international condition has resulted in the decrease of export. It was expected last year that in this season investment would grow. The import of heavy machines grew greatly, thus inciting the expectation. Yet the trade-deficit in 2022 amounts to about 900million dollars.  A total loan of 1200million dollars has arrived from the IMF, Saudi Arabia and Europe in the beginning of the year. And the Pak rupee has depreciated more. 

But the point is: can the rapid avalanche of bankruptcy that is taking place throughout Asia be sufficiently explained by only the Ukraine war and the import-dependent economies of the countries concerned? We have learnt from history that all debt-traps had ushered in a change—a change in imperialist equations. The decades of the 1930s and 1980s witnessed rapid spread of debt-traps. Human histories of the same decades have been ones of change in imperialist equations. These days there again arises an Asia-wide flow of debt-traps.

The new equation that has taken form in the capitalist world is indicative of a horrific kind of barbarism. In Asia, China is advancing with its teeth and nails exposed. At least before the Ukrainian War. And in Europe—Russia. Accompanying them are Taliban and Iran, a perfect union perhaps. We cannot swear, though, whether Russia and China will meet at a point.

It has already been discussed that the Belt and Road Initiative of China is the newest source of debt-trap in Asia. China is in this project with almost eight times the current value of Marshall Plan—4 trillion US dollars, wherein about 70 countries are contract-bound with China which has entrapped these countries in debt with scant regard to the international laws. Huge infrastructural constructions are on in these countries—gigantic ports, bridges, airports, roads, logistic hubs. In a plain sight these appear to trigger a development of steel and cement industries. And also, many man-days will be created. But the countries that are in contract with China are unable to construct all these. The constructions are not dependent on the cement or steel industries of those countries. Half the national income of the countries in some cases, or one-third is being spent on these projects. They are being dragged into debt with very high interest-rates. Sri Lanka is one of the seventy countries.

It is the morning that shows the day!

War, Arms Trade, and the Noose

Already I had mentioned that the aggressive role of China cannot be understood with only BRI investments without reference to war or sale of arms for war. From 2006 to 2009 the war annihilating the LTTE, violating human rights regulations took place. The genocide of the LTTE by the SL government surpassed all the cruelties of that organisation. The last trace of LTTE was erased. In this display of the Sinhalese chauvinism the only accomplice and friend of the Sri Lankan government was China. By means of this war the US and European influence on Sri Lanka was replaced with the Chinese. From those very days they became one of the main suppliers of arms and modern guns for Sri Lanka. China vetoed the enlistment of human rights violation in the agenda of the UN. Journalists of international standards were debarred from access into Sri Lanka. Only China supported this action. The Sri Lankan government undertook unprecedented expenditure in that war, and it was this by means of which the dependence on China came into being. They gave 700million dollars to the war-mongering Sri Lankan government. The Sri Lankan Air Force was gifted, free of cost, six F-7 fighter jets. Pakistan was encouraged by China to sell a good number of arms to Sri Lanka. Moreover, Pakistan trained the inexperienced Sri Lankan pilots how to fly the new fighters. That war remains one of the reasons for the present poverty of Sri Lanka. As per official data, the war cost them 250billion rupees and some other sources put it at 700 billion.

Through this route China surpassed Japan and India to become the main source of imports of Sri Lanka. By 2014 Sri Lanka became a participant of the great affair of making the modern silk route. The 21st Century Maritime Silk Road is a planned sea route with integrated port and coastal infrastructure projects running from China’s east coast to Europe, India, Africa and the Pacific through the South China Sea and the Indian Ocean. A Chinese catchword is (or rather was) non-interference in the internal matters of other countries. When the US government, under public pressure, was busy finding a pretext, China easily bound Sri Lanka with a contract. When, in 2007, the US withdrew military help from Sri Lanka, China entered the vacuum with a great zeal.

China hastily decided to start an Asian Infrastructure Investment Bank. It was a contest against the IMF and World Bank, since the IMF pressured China to obey several international agreements.

Pakistan began to hobnob with China only after the mutual agreement of China Pakistan Economic Corridor (CPEC) was signed in 2013. China invested 62 billion dollars which is one-fifth of Pakistani GDP. The manner, an international professional player like Imran Khan was advocating authoritarianism is really astonishing. He openly stated that America was better during the term of Trump. He also argued for the Chinese one-party, no-election system.

Every country is acutely suffering from the economic crisis of capitalism. None can find a way out. Boris Johnson resigned, Abe was killed, Rajapakshe fled. The signs of a new equation are manifest.

China and Russia are far on the way to capture other territories as a means of tiding over the crisis—through creation and expansion of spheres of influence. They have established autocracy in their own countries already, Putin and Xi Jinping have established themselves as rulers till death. China is eager to take a large part of Asia, starting with Taiwan. On the other hand, Russia is on her way forward with a so-called sketch of the old undivided Soviet Union. Both the countries have forgotten their own histories, their leaders. They are oblivious of the fact that their leaders caught them by the ear to teach them that the only way to tide over the capitalist crisis is the path of socialism.

They are acting as the capitalist imperialists do. The pattern is clearly discernible. But the international communist movement needs to delve into a question: How and why have ex-communist countries transformed themselves into neo-fascists and imperialists? Why is this new block emerging as the Axis block of the Second World War? 

But Ukraine aggression has at least given a good lesson; it will not be so easy to defeat any small country so easily. Similarly, the new equations of imperialism will also be just as short lived, no matter how much they glitter.

Some Source links

• https://www.bbc.com/news/world-europe-62817563
• https://www.bstdb.org/Overview_of_the_fin_sector_RUSSIA.pdf
• https://en.wikipedia.org/wiki/Belt_and_Road_Initiative
• https://en.wikipedia.org/wiki/Sri_Lankan_Civil_War
• https://statisticstimes.com/economy/united-states-vs-china-economy.php#:~:text=The%20economy%20of%20China%20is,in%202019%20it%20is%2067%25