End Game (24 page)

‘I am sure they will consider it.’

‘President Zhang, it is not as much as they have asked for. In fact, it’s quite a lot lower. In our view what they have asked for, to be perfectly honest, is unrealistic. What this deal offers is the very, very best that they will get. I personally intervened to make sure that this offer was at the very top of the range. Above it, in fact. When anyone looks at this deal, they should be aware it isn’t a bargaining position. It’s the full and final offer and there’s nothing more available.’

‘President Knowles, thank you for this information.’

There was silence. Knowles looked at Rose. Rose shrugged slightly.

‘President Zhang, can I ask you to pass that message on to the responsible people within the investment fund? I believe they have two seats on the board. This is an urgent need. The deal will be communicated within the hour. Fidelian Bank is required to make an announcement about its position. This deal must be done before the announcement is made. It needs to be done this morning, before the market opens here in New York.’

‘I understand from what you say that the offer will be communicated through the normal channels of the bank. If this is a final offer I would encourage your officials to make sure that Fidelian Bank understands this,’ replied Zhang.

‘They will do that, but I am concerned that the officials within your investment funds will not see this offer for what it is. I am very concerned that they understand how important it is to treat this offer seriously. This is a final offer. Mr President, would it be possible for you to ensure that they understand this?’

Knowles waited, listening closely. Everyone in the room gazed at the speakerphone.

‘President Knowles, I do not interfere with the commercial decisions of the state funds.’

Knowles closed his eyes.

‘However, the state funds must consider the realities of the world.’

Knowles glanced at Rose and Abrahams. They were both frowning, trying to decipher what Zhang meant.

‘Mr President,’ said Knowles, ‘that is very helpful. There are important realities to consider. Let me say this as clearly as I can. The failure of this bank will lead to considerable uncertainty and disruption within not only our markets, but in global markets. I think this would have a severe effect not only on America but on China as well. We are all interconnected.’

‘We are interconnected. That’s true.’

‘I am concerned that this might be the start of a serious loss of confidence and we only have to look back a few years to see where that got us.’

There was silence. Knowles suddenly wondered whether Zhang thought he was referring to the Chinese troubles of 2014. He had meant 2008.

‘As I said,’ said Zhang, ‘we must all consider the realities.’

What exactly did Zhang mean by that? What was he referring to? Did he want to come back to the discussion about South Africa? Knowles glanced at Rose. The national security advisor shook his head.

Knowles decided to pretend he didn’t apprehend anything but the most obvious inference. ‘Again, I can only stress that both our countries will suffer badly if the board of Fidelian Bank doesn’t accept this offer. Much of the progress we have made in the last few years will be reversed. Can I take it, Mr President, that you will make sure your officials understand the seriousness of the offer?’

‘They will understand.’

‘And can I stress the urgency of this?’

‘The urgency is understood.’

‘And the fact that this is a final offer. There will not be another opportunity. This is the last one.’

‘I understand.’

‘Thank you, Mr President.’

‘President Knowles, is there anything else you wish to talk about?’

‘Not today, President Zhang. Is there anything else you wish to talk about?’

‘This phone call was at your request.’

Knowles was silent for a moment, wondering whether he had done enough. This was his last chance. But he had said what he had meant to say. Saying it again wouldn’t help.

‘Thank you, President Zhang. Thank you for your time. I hope that you will be able to help in this matter. It’s important to talk when we can help each other.’

‘I agree. I look forward to talking with you again soon.’

‘Thank you, President Zhang. Good night.’

‘And good morning to you, President Knowles.’

Knowles put down the phone.

He looked around. Ed Abrahams took a deep breath and blew it out slowly.

‘Well, that’s done,’ said Knowles. ‘I hope he understood that this was the absolute, final offer.’

‘You told him,’ said Abrahams. ‘What else can you do?’

‘What happens now?’

‘I’ll call Susan and let her know you had the conversation,’ said Roberta Devlin. ‘She’ll call Custler to release the offer.’

‘And then?’

‘The Stock Exchange knows there’s an announcement coming. We’ve vetted the statements the three banks are going to release. Josh is working on a last draft of your statement.’

‘When do I make it?’

‘As soon as we know Fidelian accepts.’

25

PRESIDENT ZHANG PUT
down the phone. His advisor, Qin Jiwei, who had been present at the conversation, looked over his notes as the interpreter left the room.

‘President Knowles is a worried man,’ said Zhang.

‘Yes,’ said Qin. ‘The question is, what is he really worried about?’

Zhang nodded. ‘Go and get Bai.’

Qin got up to get the finance minister, who was waiting in an adjacent office.

Zhang waited, going over the conversation in his mind. He had no desire to help President Knowles with any domestic political difficulties he might be having. The way the American leader had unilaterally launched his initiative in Uganda had angered him, and for that reason alone he would not have been predisposed to help. Then there was the situation in South Africa, which was an issue of wholly different magnitude. In South Africa, if China was able to get its way, it would show its ability to step into disputes outside its own region as the Americans had done for so long, the mark of a true world power. Internationally, this would create a new context for negotiations on the great global issues of the world, a context in which China would have immeasurably more weight, the kind of influence that had been promised after the western downturn of 2008 and ’09 but which had never materialized. At home, it would show that the true source of China’s strength in the world was its economic influence – the reason the South African government was listening to China – and not its military force.

This was important to Zhang. Four years on from the disturbances of 2014, the three men who emerged in power retained their positions. Zhang himself had the loyalty of the internal security forces that he had led during the crackdown. Much of the army, Zhang knew, would side with General Fan if it came to a showdown. Defense Minister Xu drew support from parts of the military that did not back Fan, in particular elite units within the air force and certain naval elements. In this triangle, Xu was the waverer. The weakest of the three, the defense minister had no prospect of overcoming the other two, but could swing the outcome decisively one way or the other depending on where he chose to place his support. For four years he had played a game of sitting on the fence, holding on to his own position by keeping the two other men competing for his backing.

This couldn’t go on. For the first couple of years after the disturbances it had been possible. But by now, Zhang was thinking about the group of leaders who would succeed him, and so was Fan. To put their own men in place and give them time to prepare for power, they must first have undivided power themselves. It was obvious that Fan was no more ready to tolerate the situation than he was. The attitude of Fan’s loyalists in the army was becoming almost unbearably arrogant. Incidents took place when they confronted men from the security forces. The struggle was coming to a head.

Each man was battling for loyalty from groups in the regime outside their own core of supporters. Fan had no concept of China’s strategy to offer but the idea of greater and greater military strength. For Zhang, the failure of Fidelian Bank came at a fortuitous time. The supplication of the US president to save the bank gave him another way – like the South Africa situation – of showing that his way was the more promising, that economic strength gave China the ability to exercise power, even against the United States, in a way that military force could never match. But this opportunity created its own pressure. If Zhang gave in now to the American president and did as he asked, Fan would use the episode to show that China’s economic power was illusory or that he, Zhang, was too weak to wield it.

But he would not put China’s economic stability at risk. If it was necessary to help the American president in order to protect China’s economy, he would do it. He would have to find a way to deal with whatever Fan threw at him.

Qin came back with Bai.

‘There will be an offer,’ Zhang said to the finance minister.

Bai nodded.

‘It will not be as much as Hu asked for.’

‘How much will it be?’

‘Lower,’ said Qin. ‘Much lower.’

‘President Knowles said there will not be a higher offer,’ added Zhang. ‘This is the final offer.’

‘Minister Bai,’ said Qin, ‘would you believe that?’

‘I did not hear the conversation,’ said Bai pointedly. He had wanted to sit in on the call.

Qin shrugged. ‘Knowles is so concerned that he rings himself, and yet he cannot find a few more billions to meet our request? President Zhang, put yourself in his place. Would you call and have nothing in reserve? If he is really so worried, he will still find a way. As long as he gives them enough money, the Wall Street banks will do what he says. He will sit them down and they will come up with a deal. It is in their own interest.’

Zhang frowned. His understanding of the way the economy functioned in the United States was almost non-existent. He had worked in the security apparatus for his entire career. If it had not been for the 2014 disturbances, a man such as him would never have become president. He relied almost totally on Qin and Ambassador Zhu for his understanding of the United States.

‘The more worried he is, the more certain it is,’ said Qin. ‘If he had
not
called you, then I would say he has no alternative. If we give in to him now, all we are doing is saving his face with Wall Street. We lose the extra money that Wall Street would pay.’

The money at stake wasn’t the issue, as all three men knew.

‘So we should say no?’ said Zhang.

‘Of course. Let him go back to Wall Street and lose his face there.’

‘How does that help us?’

‘Then he is weaker. He will rescue the bank at a high price and everyone will say he has spent money to save his friends on Wall Street. This will not help him in the elections. He is weaker if the Republicans do badly.’

Zhang nodded.

‘And everyone will see,’ added Qin. ‘Fan and Xu and all their people.’

‘What do you think?’ Zhang asked Bai.

‘I am not so sure as Minister Qin that the president will save this bank if we reject the offer.’

‘Bai, look what happened the last time!’ said Qin.

‘If he said it is a final offer, perhaps it is a final offer. He may not be able to offer more. But if it is, that is because if the bank fails, he does not think it will lead to a collapse. Otherwise, I would agree with Minister Qin, he would save it.’

‘So are we saying something different?’ said Qin.

Bai shook his head. ‘I think we are saying the same thing for different reasons. This is political. It is entirely political. It’s about the elections. Why else do a deal so quickly? Why be in such a rush to announce?’

‘The bank must make an announcement,’ said Zhang. ‘He said it must make it before the American markets open today.’

‘And tomorrow is their election. If he doesn’t have a deal, when the market opens in New York, it will fall. If the market falls, he will do badly in the election. Therefore Knowles wants an announcement of a deal. Well, if he wants an announcement, I agree with Minister Qin. Let him make Wall Street pay the top price and let him put money into the deal and let the world see what he has paid.’

‘But if it is his final offer?’ said Zhang.

‘What is the effect of such a bankruptcy? On the election, considerable. But beyond that?’ Bai shrugged. ‘For a few days there will be panic. But this is not like 2008. The Federal Reserve keeps saying the system is fundamentally sound, and that also is our view. After a few days, the panic will stop. There will be no great impact. It is because it is these few days when they have their election that Knowles is so worried. If it was next week, he would not call you.’

‘If there is a great impact, we too will suffer.’

‘There will not be.’

‘Understand me, Bai,’ said Zhang, ‘I do not want to create a collapse in the United States. I do not want any such thing. If there is a risk of such a thing, I will take this offer.’

‘I understand, President Zhang. President Knowles does not want a collapse either. That is why he will not let this bank fail.’

‘I thought you said if this bank fails there will not be a collapse,’ said Zhang, pouncing on the apparent contradiction in Bai’s remarks.

‘Correct, there will not. There will be a panic. A few days. That will have no impact on us. And that is if Knowles does not save it. But I agree with Minister Qin. He will probably save it because this panic will make his party lose the election.’

‘See?’ said Qin.

‘The difference is, what I am saying, is that if he does not save it, we have a small panic, but not a collapse.’ Bai smiled. ‘A panic, President Zhang. A short panic during his election.’

Zhang glanced at Qin. The other man nodded.

A phone vibrated in Bai’s pocket. He took it out and read the message.

‘This is from Vice-Minister Hu,’ he said. ‘He has received the offer.’

‘What is it?’ said Zhang.

Bai gave him the number.

There was silence.

‘What time do the American markets open?’ asked Zhang.