China: A rich fool?

Chinese media worry that China may not get its money back if it bails Europe out

This is, everyone agrees, a dangerous time for the global economy. China's President Hu Jintao was saying so at the G20 in Cannes: "At this critical moment, the G20 must work to address the key problems, promote global economic growth and financial stability," he said.

So what does he mean as far as China is concerned? The utterances of China's leaders can be, to borrow from the Greeks, positively Delphic. Is China prepared to put its money on the table?

Here in Beijing it's worth listening to the swirl of commentary in China's newspapers. They have a lot to say about Europe's crisis. Remember China's media is state-controlled, so it gives a pretty good idea of the way the currents of thinking are running.

The first thing that is striking is how cautious China is of getting too deeply entangled in Europe's problems. "Honestly we should not get too involved in [Europe's debt crisis]. The chances of us getting our money back are relatively low, it's a dangerous game," is a typical comment in the English-language China Daily.

That's pretty understandable, any investor wants to know their money is going to be repaid, and leaders here know they will face a public backlash if people believe, in the words of the Beijing News that they "squander China's foreign exchange reserves" and "waste national wealth".

But what is more surprising is to see how suspicious many are about getting involved in any European bailout fund, some describing it as "a trap" that could mean "China is 'kidnapped" by European debt.

'Don't be dazzled'

Ordinary Chinese I've spoken to have said they think helping out Europe could be in China's interest. But China's papers are voicing suspicion that an indebted West is trying to lure China into wasting its hard-earned cash, the implication is that this could be a ploy, to weaken China and contain its rise.

Klaus Regling says Europe's bail-out fund is a safe bet for China

So there are warnings that a profligate, rich Europe could be trying to get China, that's still relatively poor by comparison, to hand over its wealth cheaply. The information centre of China's own cabinet, the State Council, warns that "China 'saving Europe' is actually 'the poor saving the rich' .. China should not be dazzled by this so that it acts impetuously and blindly".

When Klaus Regling, the head of Europe's bailout fund, was in Beijing a week ago he was baffled when a Chinese reporter put it to him bluntly that the fund was a "trap" for China. His reply: "No, China needs to invest its surpluses and we can offer a good rate of interest."

But what's clear is that China wants more than that. Much of the comment focuses on how Beijing should demand concessions for any investment, like market economy status that would make it harder to bring WTO cases against China, the lifting of restrictions on high-tech exports to China, and an end to the EU arms embargo in place since the Tiananmen massacre.

There is a clear feeling that "supporting Europe" does make sense, but as Shanghai's Liberation Daily says: "China is not a rich fool, it is not obliged to write a 'rescue story', of the poor saving the rich."