A group of suspected pirates are questioned by Nato troops about 170km off the Somali coast recently.
A group of suspected pirates are questioned by Nato troops about 170km off the Somali coast recently.

China's naval base proposal may raise suspicion



Just when you think that unmanned drones, "asymmetric warfare" and the "hi-tech battlefield" have taken over theories of modern warfare, China always seems to pull you back to the 19th century, with its emphasis on mammoth standing armies and sprawling naval armadas. But Beijing's preference for these traditional means to project power appeared anything but a throwback last week, when a Chinese admiral proposed the construction of a naval base in the Gulf of Aden.

Although Rear Admiral Yin Zhou, a senior official at the navy's Equipment Research Centre, did not specify where a hub might be built, any base would deepen the Asian superpower's presence in the Arabian Sea and the western Indian Ocean, already the farthest westward advance of Chinese naval power since the waning days of the Silk Road 600 years ago. Then, as now, Beijing's goal for establishing a more permanent military presence far from its borders is to ensure the safety of trade routes. More recently, this has included the continued flow of crude oil and other raw materials.

There is no gainsaying China's increasing strategic and economic stakes in the region. Since the beginning of 2009, China has sent four naval flotillas to help escort about 1,300 Chinese and foreign ships through waters menaced by pirates operating off the coast of the East African country of Somalia, according to the Chinese news agency Xinhua. Each time, Chinese patrol ships have been forced to rely on access to a French naval base in Djibouti for resupply.

There is little question either about the growing peril to shipping in the Gulf of Aden and the Arabian Sea. China is the world's largest importer of crude oil and last year, the number of pirate attacks and hijackings of oil tankers hit a high, according to the International Maritime Bureau's Piracy Reporting Centre in Malaysia. Pirates last year attacked 42 oil-laden tankers around the world, a 40 per cent rise from 2008, the centre said, and most of the attacks occurred off the coast of Somalia and the Arabian Peninsula.

Finally, there is little doubt about the direct dangers to Chinese shipping, where trade not only in oil but in goods and raw materials with African countries has soared in recent years. Only last week, a Chinese cargo ship, the De Xin Hai, and its crew of 25 were rescued from Somali pirates after being held since October. Their release followed the payment of a ransom of US$4 million (Dh15m) to their kidnappers.

Given China's involvement in the region, a proposal to establish a military base was probably inevitable. "I believe that a relatively stable, relatively solid base for resupply and repair would be appropriate," Adml Yin said sensibly, adding that such a base would provide a steady source of fresh food, along with facilities for communications, ship repair and recreation. How much Adml Yin's comments, part of an interview posted on the Chinese defence ministry's website, reflected the views of other more senior Chinese officials was not clear.

But he notably distanced himself from any decision to establish a base, saying it was "entirely a matter for the country's foreign policy circles" and the Communist Party. If his proposal was intended as a trial balloon to test other Chinese government or foreign reaction, it was not immediately clear how well it went down. Governments have largely been shut down the past week. Still, attention immediately turned to India, Beijing's long-time rival and Asia's other economic colossus.

China's neighbours in the South China Sea - in particular Taiwan, the Philippines, Vietnam and Malaysia - are accustomed to Beijing's aggressive use of its naval forces to assert its claims in ongoing territorial disputes and to underline the prerogatives it regards as its due as a rising world power. But New Delhi has been especially alarmed as Beijing builds a chain of naval installations - dubbed a "string of pearls" strategy - across the Indian Ocean.

China has established a maritime reconnaissance and intelligence centre on the Coco Islands, leased from Myanmar. It is also building a major deepwater port on the Arabian Sea at Gwadar in Pakistan that could become a key naval base for China's expanding submarine fleet. Furthermore, despite an avowed policy of not maintaining foreign military bases, China is also reported to be interested in establishing naval bases in Bangladesh, Sri Lanka, Cambodia, Myanmar, Pakistan and Thailand to protect its maritime supply routes from the Middle East and Africa.

It remains to be seen whether Beijing can persuade New Delhi and other sceptical governments that its motives are benign. In his comments last week, however, Adml Yin appeared sensitive to suggestions that the establishment of a base in the Gulf of Aden was the tip of an iceberg, part of a Chinese government plan for an extensive network of foreign naval bases. "We are not saying we need our navy everywhere in order to fulfil our international commitments," he said. He added he hoped the nations in the region "would understand" China's need for a "permanent, stable" base for anti-piracy operations.

Then, to underscore how much he is aware that Chinese naval ships in the waters of the Indian Ocean and Arabian Sea have aroused suspicions, Admiral Yin noted that the first Chinese frigates deployed to the Gulf spent more than four months at sea without docking. "We didn't want to arouse unnecessary suspicion from some western countries," he explained. cnelson@thenational.ae

Moon Music

Artist: Coldplay

Label: Parlophone/Atlantic

Number of tracks: 10

Rating: 3/5

Famous left-handers

- Marie Curie

- Jimi Hendrix

- Leonardo Di Vinci

- David Bowie

- Paul McCartney

- Albert Einstein

- Jack the Ripper

- Barack Obama

- Helen Keller

- Joan of Arc

Cricket World Cup League 2

UAE squad

Rahul Chopra (captain), Aayan Afzal Khan, Ali Naseer, Aryansh Sharma, Basil Hameed, Dhruv Parashar, Junaid Siddique, Muhammad Farooq, Muhammad Jawadullah, Muhammad Waseem, Omid Rahman, Rahul Bhatia, Tanish Suri, Vishnu Sukumaran, Vriitya Aravind

Fixtures

Friday, November 1 – Oman v UAE
Sunday, November 3 – UAE v Netherlands
Thursday, November 7 – UAE v Oman
Saturday, November 9 – Netherlands v UAE

How Tesla’s price correction has hit fund managers

Investing in disruptive technology can be a bumpy ride, as investors in Tesla were reminded on Friday, when its stock dropped 7.5 per cent in early trading to $575.

It recovered slightly but still ended the week 15 per cent lower and is down a third from its all-time high of $883 on January 26. The electric car maker’s market cap fell from $834 billion to about $567bn in that time, a drop of an astonishing $267bn, and a blow for those who bought Tesla stock late.

The collapse also hit fund managers that have gone big on Tesla, notably the UK-based Scottish Mortgage Investment Trust and Cathie Wood’s ARK Innovation ETF.

Tesla is the top holding in both funds, making up a hefty 10 per cent of total assets under management. Both funds have fallen by a quarter in the past month.

Matt Weller, global head of market research at GAIN Capital, recently warned that Tesla founder Elon Musk had “flown a bit too close to the sun”, after getting carried away by investing $1.5bn of the company’s money in Bitcoin.

He also predicted Tesla’s sales could struggle as traditional auto manufacturers ramp up electric car production, destroying its first mover advantage.

AJ Bell’s Russ Mould warns that many investors buy tech stocks when earnings forecasts are rising, almost regardless of valuation. “When it works, it really works. But when it goes wrong, elevated valuations leave little or no downside protection.”

A Tesla correction was probably baked in after last year’s astonishing share price surge, and many investors will see this as an opportunity to load up at a reduced price.

Dramatic swings are to be expected when investing in disruptive technology, as Ms Wood at ARK makes clear.

Every week, she sends subscribers a commentary listing “stocks in our strategies that have appreciated or dropped more than 15 per cent in a day” during the week.

Her latest commentary, issued on Friday, showed seven stocks displaying extreme volatility, led by ExOne, a leader in binder jetting 3D printing technology. It jumped 24 per cent, boosted by news that fellow 3D printing specialist Stratasys had beaten fourth-quarter revenues and earnings expectations, seen as good news for the sector.

By contrast, computational drug and material discovery company Schrödinger fell 27 per cent after quarterly and full-year results showed its core software sales and drug development pipeline slowing.

Despite that setback, Ms Wood remains positive, arguing that its “medicinal chemistry platform offers a powerful and unique view into chemical space”.

In her weekly video view, she remains bullish, stating that: “We are on the right side of change, and disruptive innovation is going to deliver exponential growth trajectories for many of our companies, in fact, most of them.”

Ms Wood remains committed to Tesla as she expects global electric car sales to compound at an average annual rate of 82 per cent for the next five years.

She said these are so “enormous that some people find them unbelievable”, and argues that this scepticism, especially among institutional investors, “festers” and creates a great opportunity for ARK.

Only you can decide whether you are a believer or a festering sceptic. If it’s the former, then buckle up.

Klopp at the Kop

Matches 68; Wins 35; Draws 19; Losses 14; Goals For 133; Goals Against 82

  • Eighth place in Premier League in 2015/16
  • Runners-up in Europa League in 2016
  • Runners-up in League Cup in 2016
  • Fourth place in Premier League in 2016/17
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'C'mon C'mon'

Director:Mike Mills

Stars:Joaquin Phoenix, Gaby Hoffmann, Woody Norman

Rating: 4/5

Huroob Ezterari

Director: Ahmed Moussa

Starring: Ahmed El Sakka, Amir Karara, Ghada Adel and Moustafa Mohammed

Three stars

APPLE IPAD MINI (A17 PRO)

Display: 21cm Liquid Retina Display, 2266 x 1488, 326ppi, 500 nits

Chip: Apple A17 Pro, 6-core CPU, 5-core GPU, 16-core Neural Engine

Storage: 128/256/512GB

Main camera: 12MP wide, f/1.8, digital zoom up to 5x, Smart HDR 4

Front camera: 12MP ultra-wide, f/2.4, Smart HDR 4, full-HD @ 25/30/60fps

Biometrics: Touch ID, Face ID

Colours: Blue, purple, space grey, starlight

In the box: iPad mini, USB-C cable, 20W USB-C power adapter

Price: From Dh2,099

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Results

ATP Dubai Championships on Monday (x indicates seed):

First round
Roger Federer (SUI x2) bt Philipp Kohlschreiber (GER) 6-4, 3-6, 6-1
Fernando Verdasco (ESP) bt Thomas Fabbiano (ITA) 3-6, 6-3, 6-2
Marton Fucsovics (HUN) bt Damir Dzumhur (BIH) 6-1, 7-6 (7/5)
Nikoloz Basilashvili (GEO) bt Karen Khachanov (RUS x4) 6-4, 6-1
Jan-Lennard Struff (GER) bt Milos Raonic (CAN x7) 6-4, 5-7, 6-4

HOW TO WATCH

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Best Foreign Language Film nominees

Capernaum (Lebanon)

Cold War (Poland)

Never Look Away (Germany)

Roma (Mexico)

Shoplifters (Japan)

McLaren GT specs

Engine: 4-litre twin-turbo V8

Transmission: seven-speed

Power: 620bhp

Torque: 630Nm

Price: Dh875,000

On sale: now

Joker: Folie a Deux

Starring: Joaquin Phoenix, Lady Gaga, Brendan Gleeson

Director: Todd Phillips 

Rating: 2/5

Cricket World Cup League Two

Teams

Oman, UAE, Namibia

Al Amerat, Muscat

 

Results

Oman beat UAE by five wickets

UAE beat Namibia by eight runs

Namibia beat Oman by 52 runs

UAE beat Namibia by eight wickets

 

Fixtures

Saturday January 11 - UAE v Oman

Sunday January 12 – Oman v Namibia

Tree of Hell

Starring: Raed Zeno, Hadi Awada, Dr Mohammad Abdalla

Director: Raed Zeno

Rating: 4/5

MATCH INFO

What: India v Afghanistan, first Test
When: Starts Thursday
Where: M Chinnaswamy Stadium, Bengalaru

COMPANY PROFILE

Company: Bidzi

● Started: 2024

● Founders: Akshay Dosaj and Asif Rashid

● Based: Dubai, UAE

● Industry: M&A

● Funding size: Bootstrapped

● No of employees: Nine

How to protect yourself when air quality drops

Install an air filter in your home.

Close your windows and turn on the AC.

Shower or bath after being outside.

Wear a face mask.

Stay indoors when conditions are particularly poor.

If driving, turn your engine off when stationary.

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