.Chapter 11 Economic Encirclement

If the world is unified, economic development will be the main theme.

Unfortunately, the world has not been unified, so when emphasizing economic development, we have to find ways to protect the results of economic development.

In Vientiane and Phnom Penh, Du Xiaolei mentioned national defense issues.

This incident did not bother her because the Laos and Cambodian authorities also made it clear that establishing an economic community is in its national interests, but China should also provide corresponding national defense assistance to help both countries build a military force that can safeguard national interests.

However, Du Xiaolei did not give a direct reply.

According to her, it is not difficult to help Laos and Cambodia achieve military modernization. China has this ability, but in the period of economic development, military modernization will inevitably invade social resources and drag down economic development. Therefore, the more ideal solution is to directly provide security guarantees.

To put it bluntly, it is to sign an alliance treaty with China.

Now, Mu Haoyang has something to do.

On March 17, Mu Haoyang, as a representative of the Chinese military, went to Vientiane with Du Xiaolei to conduct military exchanges with Laos.

The same group of military advisors arranged by Huang Zhibo was also present.

A week later, Mu Haoyang handed over the assessment report of the military advisory group to the Lao national leader.

In this report, a key point is clarified, that is, without affecting economic development, Laos should stabilize its national defense force below 30,000 people, and military expenditure will not benefit more than 5 billion yuan. After completing military modernization, Laos needs a maximum of 50,000 national defense force. If it is an alliance with China, it can reduce its military strength by 40%. Most importantly, China can help Laos achieve military modernization within five years, build a capable national defense force, and ensure that Laos has sufficient ability to defend the basic national interests.

All Laos needs to do is sign an alliance treaty with China and open several military bases.

The next day, Du Xiaolei visited the Lao national leader and formally proposed the request to rent a military base, and offered conditions that the other party could not refuse.

Of course, this lease agreement was also drafted by Mu Haoyang.

According to this agreement, China will rent three military bases in Huapan Province, Ganmeng Province and Seydung Province for a rent of 200 million yuan per year. The rent will not be paid directly to the Lao authorities, but will be cashed out in the form of military aid. The method is simple: China provides Laos with all the equipment needed to form an independent brigade every year, and provides military training to fund 150 military officers to go to China for further studies. Five years later, that is, after the military modernization of Laos is completed, China will pay the lease fee through trade compensation.

For Laos, this is definitely a pie that fell from the sky.

You should know that even if you purchase second-hand equipment from China and form an independent brigade with a force of about 3,000, it will cost 1 billion yuan. As for military training and sending officers to study abroad, the cost is even more expensive. For one hundred and fifty officers, the cost of studying in China for a year is as high as tens of millions of yuan.

As for trade compensation, it is even more tempting.

Of course, negotiations were not so easy, and the Lao authorities proposed an additional clause: China provides interest-free loans to help Laos build infrastructure.

Relatively speaking, this requirement is not an exaggeration.

You should know that Laos is the entire Southeast Asia region, except for the two small countries such as Brunei and East Timor, which are the only country without railways.

It can be said that Laos' infrastructure is very backward, with less than 5,000 kilometers of road opening.

To help Laos get out of poverty and backward situation, it is necessary to carry out infrastructure construction, and China is the most experienced country in this area in the world today.

The key is whether it is necessary to provide interest-free loans to Laos.

In this matter, Du Xiaolei did not have the right to make decisions, so she did not give an answer immediately. She just promised to report the situation and give an answer as soon as possible.

After leaving Vientiane, the two went to Phnom Penh again and offered alliance conditions to Cambodia in the same way.

Like Laos, the Cambodian authorities still attach the most importance to economic aid, that is, only if China provides economic aid, will consider forming an alliance with China.

In early April, the two returned to Beijing.

Although the demands of Laos and Cambodia are a bit too much, Li Pingko must make a decision as soon as possible.

On April 20, Li Pingko paid an official visit to Vientiane at the invitation of the Lao leaders.

Two days later, Li Pingko and Lao leaders signed the "China-Laos Alliance Treaty".

This is not a simple military alliance treaty, but an all-round alliance treaty covering politics, diplomacy, military and economic fields.

In this alliance treaty, China promises to provide national security to Laos.

To put it bluntly, when Laos was invaded by military invasion, China had the obligation to send troops to fight and was obliged to help Laos defend its national interests.

Politically, Laos promises to pursue a unilateral policy of relying on China.

In this way, Laos naturally has to cooperate with China in diplomacy.

The most important thing is at the economic level.

Although Li Pingko did not agree to provide interest-free loans to Laos, he promised to provide RMB 15 billion in annual loans in the next twenty years and provide national guarantees for Laos. To put it bluntly, as the guarantor of Laos, the Chinese government will help Laos obtain the funds needed for construction. It is not the Chinese government that provides funds, but Chinese financial enterprises, especially private banks that are keen on external business.

Economically, China has not suffered any losses.

Although funded by Chinese private banks, Laos does not have an industrial foundation, and even the agricultural foundation is not sound and complete. When carrying out modernization, Laos needs foreign assistance, such as engineering companies from China to build infrastructure, and enterprises from China also need to build industrial facilities. In this way, the loans provided by Chinese private banks will eventually be paid to private enterprises in China.

Of course, Laos did not suffer any losses.

Through cooperation, Laos can obtain the infrastructure to achieve national modernization, complete the industrialization process, provide more jobs, etc.

More importantly, after the economy develops, Laos' government tax revenue will increase significantly to repay loans.

This alliance treaty is regarded as the first sign of China's entry into Southeast Asia.

On April 27, Li Pingko arrived in Phnom Penh and signed the China-Cambodia Alliance Treaty with the Cambodian national leaders.

Similar to the Sino-Laos Alliance Treaty, the core of the Sino-Cambodia Alliance Treaty is also in the economic field. That is, after China provides military assistance, Cambodia will pursue a unilateral policy in politics and diplomacy, thereby obtaining comprehensive assistance from China and accelerating the process of national modernization.

Because the population is 2.5 times that of Laos and already has some industrial foundation, China's alliance treaty with Cambodia has a more significant influence.

The most affected is Vietnam.

Before Li Pingko returned to Beijing, the Vietnam National Newspaper published an editorial claiming that China's actions in Laos and Cambodia are completely targeting Vietnam and are building a strategic defense line to surround Vietnam, posing a huge threat to Vietnam's national interests and national survival.

In a sense, the Vietnam National Newspaper said nothing wrong.

Although the contradiction between China and Vietnam on the South China Sea issue is very prominent, it has close economic exchanges, with at least five million Vietnamese working in China, and China is Vietnam's largest exporter and Vietnam's second largest importer. Without the Chinese market, it is difficult for Vietnam's economy to develop normally.

China has improved the status of Laos and Cambodia, which clearly aims to encircle Vietnam in economic terms.

In Vietnam's view, this is the first step for China to launch an economic war.

Although Laos and Cambodia cannot replace Vietnam, because the population of these two countries is only one-quarter of Vietnam's population, and cannot provide more labor and undertake labor-intensive industries. China still needs a large number of primary commodities provided by Vietnam. However, after this, China will definitely increase the scope of application of bilateral trade, such as incorporating Myanmar, which has a population of up to 70 million, into the economic and trade exchanges with Malaysia, which has 40 million people, thereby completely excluding Vietnam from the economic community.

For Vietnam, this is definitely a disaster.

You should know that the United States can help Vietnam in politics, diplomacy and military, but it is difficult to help Vietnam economically, because the United States is also working hard to build a regional economic community and strengthen economic and trade exchanges with Latin American countries. It is impossible for Vietnam to cause losses to the more important Latin American countries.

The United States is powerless, and Japan is almost the same.

What Japan needs is a market, not a labor-intensive country, so it is difficult for Vietnam to obtain tangible financial aid from Japan.

As for the more distant EU, it is even less realistic.

According to some Western economists' predictions, it only takes about ten years for China to establish a regional economic circle in Southeast Asia, including Laos, Cambodia, Myanmar, Malaysia, and even Thailand and Indonesia, to exclude disobedient Vietnam, as well as Singapore and the Philippines, which are allied with the United States. Perhaps Singapore and the Philippines can overcome difficulties, but Vietnam will definitely suffer a catastrophe. After the economic community with China as its core matures, Vietnam will soon fall into recession due to the loss of the most important overseas market; even if it plunders the oil and gas resources in the South China Sea, Vietnam will not be able to recover in the short term.

As long as the economy is over, Vietnam will lose without a fight.

For Vietnam, the best choice is to immediately turn the course, improve relations with China, and integrate into an economic community with China as its core.

However, Vietnam must give up its vested interests and make decisive concessions on the South China Sea issue.

Can Vietnam give up its vested interests?

The decision is not in the hands of Vietnam, but in the hands of the United States.

As long as the United States continues to remain silent, Vietnam will have no choice. Only when the United States makes its position can Vietnam make a completely opposite choice.

On May 1, US President Chandler flew to Hanoi on Air Force One to make an official visit to Vietnam.
Chapter completed!