The Ship Factory

New interpretations have embellished the battle over the South China Sea; some are fantastical or fruits of propaganda, while others are nurtured by doubts and foresee multiple scenarios. China is trying to present the international community—therefore essentially the United States and Southeast Asia—with a fait accompli. It’s building lighthouses, airstrips, docking ports, and even new islands with reclaimed earth, asserting sovereignty over previously nonexistent territories. The situation is very tense, likely more than anticipated in Western and surely European offices. To understand the uncertainty, the complexity, and the danger it’s certainly more useful to study the forces at work and if the politics offer different interpretations; the stark numbers create an analytical pretext. Military spending is an evident example. It is well known that the United States has long registered the most consistent military budget in the world, verified by China’s chase who increases its spending every year. Just as striking are US arms sales—and then Europe’s—but China’s numbers are growing, especially towards countries that the West considers antagonistic. To avoid getting caught in the snare of military secrets—and therefore the impossibility of making predictions—a study published by The Diplomat, the prestigious US publication concerned with Asia, analyzes the most popular Chinese warship, the Type 054A frigate, known under the NATO code name, Jangkai-II. Understandably, Chinese authorities haven’t release information regarding its costs or provisions; therefore, the analysis must be based on a detail-oriented and careful gathering of indirect information. The publication disassembles and reconstructs all of the warship’s industrial bookkeeping: the hull, motors, electronics, armaments, and labor. The first four costs, in opposition to the mass of data supporting the analysis, are likely inferior to international costs, while labor expenses are certainly lower, including both military engineering and workmanship. Based on a few recent contracts, the Jangkai-II frigate was constructed for $365 million, and the price includes a profit percentage for the producers commissioned by the Chinese navy, that will subsequently sell it to other countries. The Diplomat observes that relationships with other countries are very advantageous for China because France and Germany charge $676-740 million for a similar craft. Even in the production of warships, which is certainly more sophisticated than steel, cement, and shoes typical of the “world’s factory,” China proves to be competitive and therefore capable of undermining the US and European oligopoly. It’s another challenge for the 2 borders of the Atlantic, right at a time when ships are intersecting menacingly in the Pacific Ocean.

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