China’s Not Quite Perfect Storm

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Unusually appalling weather in a large chunk of southern China couldn’t, it seems, come at a worse time. Unrelenting snow and cold have persisted for much longer than usual, meteorologists say, and show no sign of letting up. Already, hundreds of millions of dollars of damage have been reported (though be alert as ever to the squishiness of numbers in China) and hundreds of thousands of travelers attempting to get a headstart on the annual Chinese New Year mass migration (the Spring Festival, as it is called in China, falls on February 7th this year and tens of millions of Chinese return home in what has been termed the world’s largest annual mass migration) have been stranded in train and bus stations across the country. There were 17 fullscale blackouts and power grids across central and southern China were severely damaged.

The government’s response has been swift and very public, with Premier Wen Jiabao holding an emergency conference of responsible government officials on Sunday that was widely covered in Chinese media. The main point of the conference was top ensure electricity supplies aren’t affected by the soaring demand caused by the cold weather. More than three quarters of China’s electricity is generated by coal-fired plants and unfortunately for the government the country is currently experiencing a nasty coal shortage. Not only does this not help in its battle against inflation, which has been a growing source of popular discontent. Electricity price rises are capped by the government, but coal prices are not, which means that utilities are screaming to be allowed to pass the rises along to the consumers.

The government has to tread very carefully indeed for the next couple of weeks. China remains a very volatile place, as Nicholas Bequelin of New York Based Human Rights Watch points out, with many of the hundreds of daily outbreaks of “public disorder” arising from seemingly trivial causes. A rise in bus fares for example, led to a bloody riot in the province of Hunan that took hundreds of troops to put down and left one dead and scores injured. A friend was at Beijing airport recently and was astonished to witness a fistfight breaking out at a ticket counter among airline staff and passengers frustrated by a long delay on a scheduled Hong Kong flight.

With so many people trying to get home in the next few weeks, and the weather predicted to remain a major impediment to smooth travel, it will be a testing time for the authorities. This kind of situation is bad enough for any government, but for one that draws its sole legitimacy from its administrative competence and ability to keep the economic boom going, the threat of widespread frustrations and delays that will inevitably be blamed at least in part on Beijing is a particularly alarming prospect. The masses aren’t going to rise up and throw the bums out because they can’t get home for new year or can’t get electricity for a few days. But with a U.S. recession looming, it’s a timely reminder that if these sort of problems last for longer than a few days, and if the economic good times happen to have come to and end, things could get very nasty indeed in a hurry.