China's Expatriate Tycoons Out for No.1

LORDS OF THE RIM: THE INVISIBLE EMPIRE OF THE OVERSEAS CHINESE

By Sterling Seagrave

G.P. Putnam's Sons, 354 pp., $27.50

NO one makes a better read than the rich and famous.

That's why Sterling Seagrave, author of studies on the Marcos family of the Philippines and the Soong family of China and Taiwan, now turns his sights to Asia's most secretive and fabulously wealthy notables, the self-made tycoons among 55 million ethnic overseas Chinese.

''Lords of the Rim'' is yet another attempt to decipher the mysterious, corrupting ways of these influential Asian businessmen and their intricate network of connections touching many countries around the fast-growing Pacific Rim.

Ever since China threw off the shackles of socialism to pursue capitalism less than two decades ago, the presence of these overseas Chinese magnates in Beijing's corridors of power has caught the attention of researchers around the world. With liquid assets that the author estimates at $2 trillion, expatriate Chinese businessmen have been key bankrollers of economic booms and governments across Asia.

Unfortunately, there are no new insights to set Seagrave's study apart. In his breezy style, he tells a good tale but wastes half the book recounting the history of the centuries-old feud between Chinese merchants and mandarin bureaucrats, and the entrepreneurs' flight to more welcoming climates overseas.

The other half is a limp attempt at analyzing contemporary affairs and the tycoons' dominance of economies in the region. Seagrave goes on interminably about the ethnic Chinese in Thailand where they are the most assimilated and the least interesting.

But he gives shorter shrift to Malaysia and especially Indonesia where tensions continue to simmer between the economically dominant Chinese and resentful indigenous peoples. The Chinese presence in the United States and Canada gets disappointing treatment, and mention of Australia, where wealthy Chinese from Hong Kong and Taiwan are helping transform both the economy and society, is almost nonexistent.

In examining the tycoons' role in China today, the book highlights ethnic, clan, and geographical ties that form the basis of Chinese networking known as guanxi. Businessmen from Hong Kong and Taiwan, who have provided most overseas funding for China's economic liberalization, began investing by exploiting ancestral ties in China before moving into bigger projects.

Regarding the overseas Chinese as distant relatives, the Chinese government persuaded the tycoons to help improve China's infrastructure and lure Western and Japanese investors.

But the book overlooks evidence that the expatriate tycoons are businessmen first and Chinese second. During the last two years, as Beijing has struggled to rein in inflation and the economy has slowed, Hong Kong and Taiwanese investors had no qualms about pulling funds out of China in favor of more promising frontiers in Vietnam, Indonesia, and India. Just as they had led China's investment boom, they were also in the forefront of new foreign skepticism about the Chinese market.

Seagrave is thin and even naive in exploring China's future. With the air of an apologist, he ravages the US for criticizing China's Communists and pushing Western concepts of democracy. He also pushes the simplistic and debatable notion that more prosperity is the sole key to China's future. ''A Beijing preoccupied with prosperity is much less likely to make trouble,'' he says.

The book, however, fails to recognize that China's wealth has also helped reignite nationalism and militarism. A year ago, China's Asian neighbors would have agreed with Seagrave's call for greater Chinese economic clout. But in the wake of soaring Chinese defense spending, Chinese missile tests intended to intimidate Taiwan, and aggressiveness in the disputed Spratly Islands, many are no longer so sure.