Category Archives: China

The Trouble with Today’s Multilateralism: An Intro

Posted on by
Reply

 

So in this week’s Post I was all set to hone in on the struggles over reenergizing faltering multilateralism in the current global order. Today’s  troubles encompass the formal institutions – the Formals – from the UN, and many of its specialized agencies to the international financial ones – the World Bank, the IMF and the WTO. And the troubles extend to the Informals, the G7, the G20 to the BRICS+ and more. The struggles over multilateralism are the flip side of the return, seemingly ever more strongly power politics – the wars in the Ukraine and Gaza, and geopolitics, especially the rise in bilateral tensions between China and the United States.

But before I could go there, I couldn’t ignore the just excellent article – recommended by my colleague, and China expert, John Gruetzner – in Foreign Affairs by Zongyuan Zoe Liu, titled, “China’s Real Economic Crisis: Why Beijing Won’t Give Up on a Failing Model”. This very good piece leaned strongly into the discussion I had raised in my previous Alan’s Newsletter Post, ‘China, Seemingly, Stays the Course’. The Post chronicled the disappointment expressed by analysts and experts in the West primarily but in a rather more modulated form in China as well. The disappointment according to these experts emerged over the failure in the Third Plenum to initiate significant economic reform in the Chinese domestic economy and a clear determination to tackle domestic consumption.

Liu gets it right:

The Chinese economy is stuck. … But there is a more enduring driver of the present stasis, one that runs deeper than Xi’s growing authoritarianism or the effects of a crashing property market: a decades-old economic strategy that privileges industrial production over all else, an approach that, over time, has resulted in enormous structural overcapacity.

 

Simply put, in many crucial economic sectors, China is producing far more output than it, or foreign markets, can sustainably absorb. As a result, the Chinese economy runs the risk of getting caught in a doom loop of falling prices, insolvency, factory closures, and, ultimately, job losses.

 

Since the mid-2010s, the problem has become a destabilizing force in international trade, as well. By creating a glut of supply in the global market for many goods, Chinese firms are pushing prices below the breakeven point for producers in other countries. In December 2023, European Commission President Ursula von der Leyen warned that excess Chinese production was causing “unsustainable” trade imbalances and accused Beijing of engaging in unfair trade practices by offloading ever-greater quantities of Chinese products onto the European market at cutthroat prices.

 

Despite vehement denials by Beijing, Chinese industrial policy has for decades led to recurring cycles of overcapacity. At home, factories in government-designated priority sectors of the economy routinely sell products below cost in order to satisfy local and national political goals.

Now there continues to be some contention over whether in fact production is below cost but I I was pleased by Liu’s ‘recommendation’ that the two – the West and China – consider options other than just piling on the tariffs. Liu correctly points out the negative consequences of such trade policy:

A China that is increasingly cut off from Western markets will have less to lose in a potential confrontation with the West—and, therefore, less motivation to de-escalate. As long as China is tightly bound to the United States and Europe through the trade of high-value goods that are not easily substitutable, the West will be far more effective in deterring the country from taking destabilizing actions. China and the United States are strategic competitors, not enemies; nonetheless, when it comes to U.S.-Chinese trade relations, there is wisdom in the old saying “Keep your friends close and your enemies closer.

That is why I have suggested negotiating – and one aspect in this case could be Voluntary Export Restraints or VERS. VERS are not super policy  actions – I get that  but they do encourage bilateral discussions rather than just unilateral penalties. As Liu suggest:

The U.S. government should discourage Beijing from building a wall that can sanction-proof the Chinese economy. To this end, the next administration should foster alliances, restore damaged multilateral institutions, and create new structures of interdependence that make isolation and self-sufficiency not only unattractive to China but also unattainable. A good place to start is by crafting more policies at the negotiation table, rather than merely imposing tariffs. … If the government [China] also implemented voluntary export controls, it could kill several birds with one stone: such a move would reduce trade and potentially even political tensions with the United States; it would force mature sectors to consolidate and become more sustainable; and it would help shift manufacturing capacity overseas, to serve target markets directly.

While working through the WTO might be preferable, and many analysts suggest such an approach for multilateral trade frictions, realistically that course of action is out of reach for the moment.

So there you are on the Third Plenum and global trade.  Let me at least turn to the original subject for this Post; let’s at least open the discussion on multilateralism and its problems. I was particularly attracted to a piece published recently by Pascal Lamy. Pascal Lamy (pascallamy.eu) is currently the Vice-President of the Paris Peace Forum, and coordinator of the Jacques Delors Institutes (Paris, Berlin, Brussels). Importantly, Pascal Lamy served two terms as Director General of the World Trade Organization (WTO) from September 2005 to September 2013. He is someone that is very familiar with critical aspects of the multilateral system. Recently his piece, ‘Reshaping the Global Order’ was published in a large edited volume by colleagues from the Center for China & Globalization, CCG,  Henry Huiyao Wang and Mabel Lu Miao, Enhancing Global Governance in a Fragmented World: Prospects, Issues, and the Role of China. Now Lamy sets out the critical structural issues that impair today’s multilateralism efforts. As he says:

The main long-term, structural factors at play can be summarized by sovereignty as a founding principle of an international order, by the obsolescence of the previous order, and by the US-China rivalry.

It is not surprising that he identifies ‘sovereignty’ as the first key to multilateralism’s problems:

Sovereignty has been, is, and will remain the main obstacle to building a fully fledged international order as long as it is accepted as the core principle of international law.

So many analysts acknowledge the burst in new actors in the international system: substate actors, regions and cities and also non-state actors like NGOs, large public and private corporations but all struggle against dominant state actors. National sovereignty dominates international relations and often leads to unilateral actions that undermines wider cooperation.

Then there is ‘obsolescence’.  This focuses around the elements of the system, especially the Formals that were put in place at the end of World War Two at a time when the Global South that has had such a recent impact on international relations existed primarily as colonies of the West:

Obsolescence has to do with the origins of the current global system, the architecture of which dates from arrangements made after the Second World War. The ‘universal’ nature of these arrangements is increasingly seen as a product of a past pattern of Western dominance at a time when new nation states are now reshuffling the old power distribution …

Lamy then targets the impact of the evolving international order:

All in all, the previous international order is being shaken by increasing North-South and East-West tensions and frustrations, and by a change in the balance between geoeconomics and geopolitics, the former losing the force it had gathered in recent decades, and the latter regaining its past dominance over world affairs. We are thus moving toward less of a rules-based system, and more toward the use of force. This context obliges us to consider new paths, tentative as they may be.

And finally Lamy underlines the rise of geopolitical tensions, especially between China and the United States, and the impact that these tensions have had on the current multilateral order:

The intensification of the US-China rivalry is the third main factor shaping the demise of the international order, as this rivalry increasingly pits the two main world superpowers against each other. Indeed, they now believe they have become dangerously vulnerable to each other—hence a change of view on both sides about globalization. Whereas the US and China previously celebrated the benefits of increased economic interdependence in fostering development and reducing poverty, they are now trying to address what today they consider as overdependence and have embarked on a decoupling journey which challenges the rest of the world with hard binary choices and which permeates international life in the form a sort of ‘cold war 2.0.’

So what is to be done? How can a multilateral system be revivified and made effective – bringing greater stability to the global order and energizing transnational global governance efforts?

That’s where we will start in the next Post.

Image Credit: Geneva Interdisciplinary Centre for Economics and Law

This Blog originally appeared as a Substack Post at Alan’s Newsletter – https://open.substack.com/pub/globalsummitryproject/p/the-trouble-with-todays-multilateralism?r=bj&utm_campaign=post&utm_medium=web&showWelcomeOnShare=true

Free Subscriptions are welcome as are comments

 

China, seemingly, stays the course

Posted on by
Reply

It is hard to resist not commenting on Donald Trump’s views, so I will if just briefly. In this instance the comment is over Kamala Harris’s racial makeup. It is ‘weird’ as the Democrats have started saying. In fact that barely describes his comments on her. Mind you, I doubt that it is the last time we will hear such ‘jaw dropping insights’ from Trump when it comes to his likely opponent Kamala Harris.

All right, let’s turn to today’s focus – the state of US-China relations following China’s Third Plenum – really focusing on the Third Plenum. This gathering is the Third Plenum of the 20th Party Congress, which brought together the Party’s top leadership, including all the members of the Central Committee and the Politburo of the Chinese Communist Party.  Third Plenums in particular have especially been closely followed. Why? Well, it really began with the Third Plenum of the 11th Party Congress in December 1978. That Third Plenum ushered in a series of policy changes championed at the time by Deng Xiaoping. This Plenum was in retrospect the start of the ‘Reform and Opening Era’ which was followed by the Third Plenum of the 14th Party Congress when the leadership identified the goal of creating a ‘socialist market economy’. And, at the 18th Party Congress in November 2013, the CCP emphasized in that Third Plenum,  “the decisive role of the market in allocating resources,”. So, it is not unreasonable for experts, officials, etc. to look at each 5-year Third Plenum to identify signals for domestic economic reform which many then anticipate impacts on the global economy with China’s increasingly central role on the international economy.

It’s not a surprise, then, that there was a degree of anticipation for this Third Plenum which had been postponed for months, especially given the flagging Chinese economy. Our colleagues at CSIS including Jude Blanchette and Scott Kennedy described the tortured passage of policy creation:

According to a CCP website, the document went through 38 drafts. Right after the conclave ended, the CCP issued a communique (English, Chinese) summarizing the results of the meeting. On Sunday, July 21, the text of the full, far more detailed Decision (English, Chinese) was issued, which provides a stronger foundation for evaluating the meeting’s significance.

So where are we and what consequences are likely to follow the policy pronouncements?

There was a lot of anticipation. As pointed out by Bert Hofman in his Substack Post: 

This year’s third plenum was highly anticipated due to several factors.  The multitude of structural challenges that China’s economy is facing—debt, demographics, demand, deflation, and decoupling—require the robust economic reforms that third plenums tend to deliver. Second, China’s propaganda machine had built up the plenum’s importance, comparing it with breakthrough plenums of the pasts.

But for most analysts the outcomes have been rather disappointing. As pointed out, again by Bert Hofman, the hoped for policy tilt and more toward markets and/or greater domestic consumption is not evident in the Declaration:

This year’s plenum has dropped the decisive role of the market.  Instead, it  proposes that the party should “better leverage the role of the market.” This is hardly an encouragement of the private sector, whose confidence is still recovering from regulatory crackdowns and COVID lockdowns.  At the same time, in a press conference after the conclusion of the plenum Han Wenxiu, deputy director of the Central Financial and Economic Affairs Commission’s general office, and a main drafter of the plenum decision document, said that it was “necessary to create a favourable environment and provide more opportunities for the development of the private sector” in China.

Nevertheless, the omission of the market’s decisive role is in line with the more statist view on development that has been gaining grounds under Xi Jinping, and that the private sector will be increasingly guided by the party and restricted by regulation.

 

But the nature of reforms has changed—whereas in previous plenums reforms were predominantly aimed at facilitating marketization and liberalization of China’s economy, they are now meant to strengthen the policies and institutions that underpin Xi Jinping’s view of the world.

The party-state dominance seems to be fully in charge. And China can be expected to stay the current course for domestic economic growth and prosperity. As Scott Kennedy argues:

The Communique and Decision give the distinct impression that despite the economy’s various structural problems and cyclical downturn, the CCP is not going to change course, but instead will intensify its efforts to steer the economy on to a sustainable long-term path. The central focus for generating “high-quality development” will be on expanding focus on advanced technologies, what are now ideologically described as “new productive forces” (新质生产力).

 

That said, the Plenum’s analysis and policy proposals on the economy are likely to draw a more skeptical reaction from a variety of corners, domestic and international, because of its deeply statist focus: 1) A strong emphasis on the central role of China’s party-state in directing the economy; 2) The prioritization on investment and production as the drivers of growth and far less attention to consumption and households; 3) Continued support for the “public sector” and state-owned enterprises (SOEs) even while pledging to create a level playing field for private firms; 4) A discussion of the global economy that proposed incremental expanded market access to China while stressing the need for China to leverage its large market for its own benefit; and 5) The expansive discussion of national security and the need to align economic policy with national security, which as Jude Blanchette notes, is centered around the security of the CCP.

Scott’s colleague at CSIS, Claire Reade, underlines that trade partners are unlikely to be fooled by this Plenum Declaration and trade tensions as a result are unlikely to abate and that’s without taking into account the likely economic earthquake of a second Trump Administration:

The latest Third Plenum Decision declares that “overall, we have accomplished the reform tasks” set out in 2013. Since this is patently not the case, it is particularly discouraging. The decision ironically then highlights the gap between its triumphant conclusion and reality by going on to pledge that by 2029, the market will determine the allocation of resources, and private domestic and foreign enterprises will obtain equal treatment with state-owned enterprises.

On balance, trading partners need to continue to be savvy and proactive in taking steps to protect their economies against this massive, state-heavy economy, and companies need to look carefully at their own risk management.

It is not surprising that various Chinese experts are suggesting that a more incremental approach was always a more likely approach of the President and the Party. Here is Huang Yiping, who is the Dean of the National School of Development at Beida, or Peking University, assessing on the Pekinology Substack Post the policy approach coming out of the Third Plenum:

The first point you probably all saw is that the Asian market dropped after the Third Plenum, especially after the full document was out. So some people felt a little bit pessimistic. My own sense, my take, is that the market was probably too optimistic about what they should expect.

So some people felt a little bit pessimistic. My own sense, my take, is that the market was probably too optimistic about what they should expect.

 

In fact, if you were paying attention to what the President himself was saying and the message government officials were trying to convey to the public. It was pretty clear this would not be a grand-scale liberalization program. This will be about reform, about modernization. But the key approach, the President outlined himself very clearly. He called it running towards the problems and trying to correct them. So it’s more like a down-to-earth and very practical approach—when you try to see the problems, you try to overcome them.

 

So when you say, well, the market is disappointed. That’s probably true, but either because the expectation was just overly too high or No. 2, I think the reason why investors are not very upbeat at the moment is because the macroeconomy is not doing particularly well.

Huang Yiping is aware, however, of the consumption problem:

Weak consumption causes two problems. No. 1 is you obviously would easily end up with a domestic overcapacity problem, right? You produce a lot, you invest a lot, and then the final consumption demand is very weak. That means there will be a certain portion of the capacity you cannot find domestic buyers for, and you call it overcapacity. That’s why during the last 45, 46 years of Chinese reform, we almost always had the overcapacity problem.

I think the macroeconomic problem is there is a macro imbalance. Consumption and demand and supply are not very balanced. So that’s one big issue.

So where does that leave us? I anticipate there will be continuing if not growing trade tensions with the US and with Europe as well as China continues its ferocious pace of manufacturing exports and fails to encourage greater domestic consumption. At least to constrain these tensions and protective trade actions in the absence of the WTO, it might be useful to try and negotiate VERs – ‘voluntary export restraints’ with China. It is not optimal – far from it – but it could avoid a trade ‘bloodbath’.

An important opportunity has been missed for the moment and may in fact be even more dramatically lost if Donald Trump wins the next election in  November. Let’s hope the US electorate is smarter than that.

Image Credit: CNN

US-China Relations- How difficult is the relationship?

Posted on by
Reply

This week I, and just about everybody else holding some interest in sport, or at least in innovative commercials were distracted by the events leading up to, and including, the 58th Super Bowl. Notwithstanding the quickening approach of this Super Bowl Sunday, however, I was drawn to an examination by a number of experts for the Brookings Institution of the US-China relationship.

So in this somewhat shortened Post, thanks to the Event,  I thought I might pay a bit of attention to their useful views.

Graham Allison, one of the experts called on to respond to the question, pointed to the issue posed to the experts:

The invitation from Brookings’ debate organizers asked: “Is the U.S.-China relationship the most consequential bilateral relationship for the United States in the world?

He went on to lay out just why the bilateral relationship is so consequential:

My answer is: yes. If not China, who?

China is:

– one of only two nations that poses an existential threat to the United States.

– the only nation that poses a systemic threat to the U.S. position as the global leader, architect, and guardian of the post-World War II international order.

– the largest emitter of greenhouse gases—accounting for more emissions in 2022 than the United States and Europe combined.

– the second backbone of the world economy: the manufacturing workshop of the world, the No. 1 trading partner of most countries in the world (including the European Union and Japan), and the supplier of most critical items (including everything green and clean) in global supply chains.

– both a classic Thucydidean rival and America’s inseparable, conjoined Siamese twin.

The folks who commented included, as I noted above, Graham Allison, Douglas Dillon Professor – Harvard, and additionally, John Cartin, Adjunct Professor, Walsh School of Foreign Service – Georgetown, Elizabeth Economy, Senior Fellow – Hoover Institutions and Susan Thornton, Senior Fellow – Paul Tsai China Center, Yale Law School, and nonresident fellow, the Brookings Thornton China Center.

It is, for sure, a significant question. After all, the state of the US-China relationship, largely without question, drives the geopolitics of current international relations. And the answers did not fail to satisfy. The assessments by these experts are all very revealing and if you have a moment the answers are worth a read. I say this notwithstanding that not all even saw the relationship as most consequential. In fact Elizabeth Economy promoted a somewhat contrary notion. As she argued:

There are many ways to describe the U.S.-China bilateral relationship. For example, the relationship is the world’s most complex, most challenging, or most competitive. However, the relationship is not “the most consequential in the world for America. Far more consequential is the United States’ relationship with its network of allies and partners in Asia, Europe, and North America. Unlike China, the United States’ allies and close partners share the same values, norms, and strategic objectives. … However, over the almost half-century since the normalization of the U.S.-China relationship, the bilateral relationship has never realized the potential Washington imagined. The two countries’ values, norms, and interests have increasingly diverged, and the ties that have bound them together have increasingly frayed.

In his response, Allison is unwilling to let the Economy argument pass and sets it out his views starkly:

In arguing against the significance of the U.S.-China relationship, both Economy and Cartin duck the reality of China’s existential threat. The brute fact is that China is one of only two nations in the world with nuclear arsenals that constitute genuine “existential” threats—meaning threatening existence.

While not unanimous, then, still I think most would underscore that the US-China bilateral relation is highly consequential. Having said that though, I was most taken with Susan Thornton’s response. Now admittedly I know Susan most of all the experts as she is a key figure in our own China-West Dialogue (CWD). But she argued and targeted exactly what I would have also zoned in on. Susan accepted that the relationship was indeed the most consequential but then targeted what I would have as well: the key to the relationship and its likely impact on the global order is the state of domestic affairs in the US. As Susan argued:

And just to be clear, relations with or actions taken by any other single country will have little consequence for Americans in the world compared to our own decisions and actions. Our fate lies in our own hands. … In short, America cannot escape “China impact.” China is big, capable, changing rapidly, and operating in all priority zones. Still, obsessing over what China does or might do is a mistake that will carry large opportunity costs for America that it cannot afford. China may be the most consequential “other country,” but we need to take responsibility for our own future, a future that will involve “China impact,” but that we can shape.

Absolutely. Couldn’t agree more. In the face of the real possibility of a return of Donald Trump as American President, most anything, and likely everything else pales in comparison to that reality and the real chaos likely to be generated by his return both for domestic and US foreign policy.

Image Credit: MIssouri State University

This Post originally appeared at my Substack, Alan’s Newsletter. https://open.substack.com/pub/globalsummitryproject/p/us-china-relations-how-consequential?r=bj&utm_campaign=post&utm_medium=web&showWelcomeOnShare=true

Feel free to subscribe there and coments are welcome

 

Maintaining ‘Entanglement’: APEC Summit Discussions including the Xi-Biden Bilateral Summit

Posted on by
Reply

Doing some quick catch up on the APEC Summit that was held between November 11th and 17th in San Francisco. The main event, as it turned out, was the much discussed bilateral summit between China’s Xi Jinping and US President Joe Biden. While the Indo-Pacific Economic Framework for Prosperity (IPEF) meetings to receive some attention – more for what didn’t happen than what was secured – the APEC gathering activity was dominated by US-China Bilateral Summit and there was some attention paid to the other bilateral Summit of note that between President Xi and the Japanese Prime Minister Fumio Kishida.

The Post here is constructed from several Substack Posts in Alan’s Newsletter: “Maintaining ‘Entanglement‘: APEC Summit discussions and more” and “It’s working; just not like what was anticipated: The sudden rise of Bilaterals”; and “So Success, or What? Final thoughts on the Summits in San Francisco”. Feel free to subscribe to my Substack: Alan’s Newsletter

Maintaining ‘Entanglement’: APEC Summit discussions and more

It appears that we are likely to see a meeting this month of President Xi and President Biden at the margins of the APEC Summit. I think that is a good thing. What can we, or should we, expect from such a summit of leaders of the two leading powers? While contemplating this question, I was caught by two articles written by Brookings colleague, Ryan Hass. Ryan has recently been named director of the John L. Thornton China Center and holds the Chen-Fu and Cecilia Yen Koo Chair in Taiwan Studies at Brooking is also a senior fellow in the Center for East Asia Policy Studies. Ryan has contributed two first rate articles on US-China relations – what they are, and what they need to be.*

First, there is the big question of where US-China relations are, and then where they need to be? There is little question that Ryan is correct in believing that the US and the global order would be far worse off if China were to exit the current international system fragmenting what is still a critical -and I believe necessary – ‘single international community’. As Ryan urged in one of the two contributions, this a recent Foreign Affairs piece:

Washington should aim to preserve a functioning international system that supports U.S. security and prosperity—and that includes China rather than isolates it. Meanwhile, the United States should maintain a strong military to deter China from using force against the United States or its security partners and seek to sustain an overall edge over China in technological innovation, particularly in fields with national security implications. … Washington’s goal should be to keep China entangled in a global system that regulates interstate behavior and pushes Beijing to conclude that the best path to the realization of its national ambitions would be to operate within existing rules and norms.

‘Entanglement’ as a strategic aim strikes me as ‘right on target’.

Continue reading →

Advancing Global Governance by Revitalizing a Regional Institution

Posted on by
Reply

While I have suggested earlier that I don’t think an initial  focus on building regional or multilateral institutions is necessarily the best first step in global governance and possibly a means to ‘tone down’ geopolitical competition rhetoric and action, I am now about to contradict myself and this position. For, in the end, there are some obvious regional and international institutions that could encourage collaborative action and push global governance collaboration. And, in fact, I have in mind an obvious one that has – as a current Chinese slang term might well describe it – ‘tang ping’  躺平 – or ‘lying flat’. It is the Trilateral Summit.

Trilateral Summit, you say. Well, yes, actually. The Trilateral Summit is, periodically, a Summit of the ‘key’ East Asia leaders – South Korea, Japan and most meaningfully,  China. A little history here. The Trilateral Summit was first proposed by South Korea in 2004. At that time the three powers met for a separate session at the ASEAN gathering, described as ASEAN plus three. In 2007, at the eighth meeting of the ASEAN plus Three, the leaders agreed to initiate a separate Trilateral Summit. And, in December 2008, the first separate summit was hosted by Japan at Fukuoka. At its initiation the three powers saw the Summit focusing on: closer trilateral relations, the regional economy and disaster relief.  One of the regional security issues that has been in front of leaders repeatedly has been the nuclear weapons program of the Democratic Republic of Korea, the DPRK. In the 2018 summit the FT  described the leaders’ view of the DPRK nuclear weapons program: “the three leaders agreed to co-operate over North Korea and called for Pyongyang to give up its nuclear weapons completely.” While that agreement may no longer hold, it shows the value of this Summit.

The Summit is not quite a leaders’ gathering. While South Korea is often represented by its President and Japan by its Prime Minister, China has generally been led by its premier, not the President.

Continue reading →

Focusing on the China-West Dialogue Project (CWD); Advancing Global Governance; and Improving US-China Relations

Posted on by
Reply

Now, turning back to the Global Summitry Project (GSP) and the Vision20 – collective efforts of Yves Tiberghien, Professor of Political Science and Konwakai Chair in Japanese Research at the University of British Columbia (UBC), Colin Bradford, nonresident Senior Fellow from Brookings  and myself, the Director of the Global Summitry Project. We have initiated various research initiatives.

A critical major effort over some three years has been the China-West Dialogue Process (CWD). The CWD has been Co-Chaired with Colin Bradford, the lead Co-Chair of the CWD and myself. This initiative has held some twenty plus virtual gatherings and many participants are set to gather in person for the first time in years at the Global Solutions Summit in Berlin May 15-16th <https://www.global-solutions-initiative.org/programs/china-west-dialogue/?utm_source=MASTER_Verteiler&utm_campaign=33fe63ffef-EMAIL_CAMPAIGN_2019_11_11_10_44_COPY_01&utm_medium=email&utm_term=0_4f4e08bb85-33fe63ffef-447373003> to focus on US-China relations and assess how the G20 can advance critical, and dramatically needed global governance issues – global debt management, climate change policy, global food security and health security.

What is required, however, and is currently missing, is that the two leading powers turn their minds to such critical global governance policy efforts – both bilateral and multilateral.  From the beginning the CWD has targeted first Trump policy and now Biden foreign policy. Trump Administration officials made it clear that ‘engagement with China’ born in the Nixon Administration was at an end. Both Administrations called for competition though not for conflict. The outcome so far, especially for bilateral relations has been dismal.

As my Co-Chair Colin Bradford wrote on March 7th: “The strategic competition between the US and China is real and must be accepted and managed. But the confrontational narratives of this binary relationship are dominating and weakening global leadership and governance and present a threat to the global order.”   As the Editorial of the NYTimes, today, March 12th, urges: “Americans’ interests are best served by emphasizing competition with China while minimizing confrontation. Glib invocations of the Cold War are misguided. It doesn’t take more than a glance to appreciate that this relationship is very different. Rather than try to trip the competition, America should focus on figuring out how to run faster, …” <https://www.nytimes.com/2023/03/11/opinion/china-us-relationship.html?referringSource=articleShare>. Competition is not the problem for the Biden Administration; but collaborative policy making certainly appears to be. And current policy has made it more difficult. All one needs to do is to examine the interaction of the Biden Administration and the Chinese Government and Party on “balloon gate”. As Paul Herr of the Chicago Council identifies in his post at EAF: <https://www.eastasiaforum.org/2023/03/12/ballooning-mistrust-in-the-us-china-relationship/?utm_source=newsletter&utm_medium=email&utm_campaign=newsletter2023-03-12> “Washington and Beijing’s response to the appearance of a Chinese surveillance balloon over the United States in February 2023 illustrates several aspects of the current US–China relationship that will make it very difficult to reverse the downward spiral in bilateral ties. The episode displayed mutual distrust, latent hostility, a failure to communicate and the adverse impact of internal politics on how the two sides deal with each other.”

As the CWD has identified at the GSI CWD Website – <https://www.global-solutions-initiative.org/programs/china-west-dialogue/> “The CWD’s fundamental goal is to help reshape the narratives and behaviours of US-China relations from friction to function by engaging other middle and major powers and emerging powers in a reframed China-West relations in G20 processes and other public forums. The aim of the Project is to identify new political dynamics that yield more productive relations in the international system.” At the CWD has identified, and noted by Colin Bradford on March 7th: “The CWD has concluded that the G20 is the most important platform for profiling and actualizing these alternative political dynamics in the year-long official G20 processes, which could enable convergence on systemic threats and ease geopolitical tensions.”

It is a challenging  goal in the face of current difficult US-China relations – but crucial for settling global order relations that have become ‘so rocky’ and unsettled in the last several years.

March 12, 2023

 

Impact of zero-Covid Policies on the CPC, the Government and Xi Jinping

Posted on by
Reply

Protests against the zero-COVID policy in China quickly spread across the country. While Anti-COVID protests are certainly not a new global phenomenon, such a public and widely spread expression of frustration towards the Chinese government is rarely seen.

This note examines the Chinese top level leadership’s approach to the zero-COVID policy; why it led to mounting public anger and frustration; and where it may lead.

The Initial Approach – Central Government’s Blame Avoidance

 While President Xi vowed that he will “supervise and deploy (COVID-19 prevention operations) personally”, the COVID-19 prevention throughout the country took on a decentralized approach.[1] In other words, the order (of no COVID cases) was delivered by the Central Government, but it was up to the local authorities to interpret the order and execute it. For instance, each province has its own mandatory QR code system that rated users’ risk of exposure to COVID-19, and each province had its own domestic and international arrival quarantine requirements.

As power becomes more consolidated within the CPC, it would only appear plausible that the whole country would take on a centralized approach for COVID-19 strategy such as a national QR code system and a standardized requirement for traveling and quarantine. Nevertheless, these decentralized approaches were permitted to continue in the past two years. Frequently, these inconsistent COVID policies among provinces and regions in China caused confusion and frustrations among residents and travellers. This could be viewed as the Central Government’s strategy for ‘blame avoidance’. By providing an opaque order of “no COVID cases”, the Central Government shifts responsibilities to the local governments while leaving them to interpret its own plan. If the strategy is successful, the Central Government, or President Xi himself, could take credit as the operations are overseen by him “personally”.[2] In the event that the strategy is unsuccessful, or controversial, residents naturally would hold the local government accountable as they implemented these procedures.

Too Little To Lose?

A stable society based on rapid economic growth has been a key goal of the CPC. The idea of “you can earn money and spend money but don’t touch politics” is an unspoken social contract among many Chinese and foreign citizens and companies. While China enjoyed rapid economic growth, so also its middle class. Owning at least an apartment and a vehicle and living comfortably have already become the default goal of many middle class citizens. Based on the prerequisite of not participating in politics, these goals are achievable when the balance of the ability to earn a decent wage and reasonable cost of living is maintained. The Chinese citizens know very well that what they have accomplished and acquired could be lost very quickly if they are disobedient to the government. Therefore, most citizens have chosen to refrain from directly criticizing the government for its actions.

With a decelerating economy, however, this balance of economic advancement and political silence is eroding. In major cities such as Beijing and Shanghai, it is hardly possible for youth to find a job that pays high enough to support themselves and afford an apartment or vehicle. The draconian COVID measures further impeded citizens’ ability to find jobs and get paid; hence, their ability to make new purchases. According to the National Bureau of Statistics, real estate development between January 2022 to July 2022 dropped by 6.4 percent while residential investment dropped by 5.8 percent.[3] On the other hand, major online shopping platforms often publish sales volume during November 11th, Single’s Day.[4] According to Sohu News, online shopping platforms such as Alibaba and Tmall both recorded double digit or triple digit growth in sales volume in the past several years.[5] Nevertheless, Tmall did not disclose its sales volume for 2022, instead it published a statement that “the sales volume was largely the same as last year”.[6] These moderated data could also suggest that the general public prefers to save their money instead of spending it given their job stability is affected by the unpredictable COVID policies.

Continue reading →

The Shanghai Cooperation Organization: “Symbolically significant”, for now

Posted on by
Reply

The Shanghai Cooperation Organization (SCO) leader-led summit was held in Samarkand in this September. It brought global attention to the group first established by Beijing at the start of the 21st century. Not only was it Xi Jinping’s first trip outside the country since January 2020, with the ongoing war in Ukraine, but the meeting was also an opportunity for a sit down between Xi and Putin on the margins of the summit. That meeting was the immediate point of interest for the global media. In Samarkand, India’s PM Modi was openly critical of Russia as he tried to carve out a leadership position for the South Asian republic. While commentators noted that PM Modi did not hold a bilateral with President Xi indicating that the warmth of 2018’s Wuhan Summit between the two has not yet been rekindled.  Iran participated for the first time with the group now representing 40 percent of the world’s population and nearly a third of global GDP and all of which, barring India, are decidedly illiberal regimes.

While the SCO has more than two decades of existence, the summit is of interest not just because of the high-level leader diplomacy but on the peculiar qualities of a multilateral institution that is often neglected by Western scholars and analysts.

The SCO was established in 2001 by the People’s Republic of China (PRC) with the intention of providing stability to the former Soviet Central Asian spaces with a particular focus on cooperation to combat what the members called the ‘three evils’ of terrorism, separatism and religious extremism. This initial motivation reflected China’s broader concerns about counterterrorism and Islamic extremism in the early 2000s as well as long term anxieties Beijing has had about the threat to the Communist Party of China (CPC) rule at the peripheries of the China.

The initial work of the SCO focused on coordinating the members’ security policies and sharing information, as well as conducting regular military exercises. The group added narcotic trafficking to its counterterrorism agenda and began to talk about economic collaboration and had periodic rhetorical flourishes about global governance and international order. From its initial membership of: Russia, China, Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan, the SCO has expanded to include India and Pakistan in 2017and now Iran.

While the SCOs public diplomacy has been wide ranging, the group was, and remains at its heart, interested primarily on matters of international and transnational security. Yet as many analysts point out, Beijing and the members often appear disinterested in many quite obvious regional security matters, the most immediate example of which is the deadly clash between Tajikistan and Kyrgyzstan taking place barely 200 km from the current Summit which elicited neither comment nor action from individual leaders or the group as a whole.

Multilateral institutions often serve both symbolic and substantive functions. With the former, symbolic functions provide the opportunity to signal intent, represent collaboration and more broadly to perform statecraft. But substantive functions can provide the means to advance actual policy coordination and, in their more advanced forms, bind members into strict policy commitments, most famously exemplified by the EU and WTO. Most initiatives provide a blend of performance and policy as well as offering a platform at which ad hoc diplomacy can take place, such as the China-Russia meeting this year.

The SCO today is, however, a grouping that is long on symbolism and short on substance. At first glance it appears to be a good example of institutional balancing, that is when states use international institutions to balance against the influence of major powers. In this case the intention is to use the SCO to ensure that the US and its allies’ influence on the geopolitical dynamics in the Eurasian heartland is blunted. From this perspective bringing India into the fold was intended to hedge against Delhi’s growing alignment with Washington.

More broadly, it also represents a desire for a more multipolar and multimodal international order in which the North Atlantic powers have less influence; and liberal values are diluted as well.

While the symbolism is strong, and in the current moment it has particular salience given the Ukraine war illustrating starkly the clash between authoritarianism and democratic systems, there is little sign of the SCO making any meaningful progress on the substantive side of the ledger. One might be tempted to view the SCO as a nascent Central Asian NATO, yet the preferences of the key SCO powers remain low on concrete commitments as well as exhibiting not inconsiderable tensions between various members. At least for now, it is unlikely that the SCO will take any steps to move beyond the symbolic.

It is tempting, therefore, to write off the SCO as another example of shallow diplomacy in which grand statements of intent and photo opportunities are confused for actual statecraft. That is certainly true right now, but in the building of the foundations for collaboration among  influential and illiberal states in a geopolitically crucial zone of world politics, the members in general, and China in particular, have established a solid platform from which members may ultimately make good on their very real ambitions to transform the principles and practice of the regional order and possibly the international order.

Image Credit: YouTube

Struggling to Keep UN Multilateral Institutions Relevant

Posted on by
Reply

She sought to put her best foot forward in her first appearance following her controversial visit to China. In the opening moment of her statement Michelle Bachelet, the UN High Commissioner for Human Rights reflected the positive aspects of her trip:

Let me start by thanking the Government of China for its invitation. For the first time in 17 years, a UN High Commissioner for Human Rights has been able to travel to China and speak directly with the most senior Government officials in the country, and other interlocutors on key human rights issues, in China and globally I appreciate the Government’s efforts in making this visit happen, particularly the arrangements for my virtual meeting with President Xi Jinping.

She has received dramatic criticism from the human rights community. As identified in the NYT, the comments from Sophie Richardson, the China director at Human Rights Watch dismissed the Commissioner’s efforts: “That mandate requires a credible investigation in the face of mountains of evidence of atrocity crimes, not another toothless dialogue.”  A second comment by Kenneth Roth, the director of Human Rights Watch underscored the harsh negative view expressed by the human rights community (NYT, June 13, 2022) : “There was no condemnation from Madame Bachelet even remotely commensurate with the severity of the atrocities being committed in Xinjiang, … She gave up her most powerful weapon for a back room dialogue which will be meaningless.”

Continue reading →

Summit for Democracy – Who and Where is the Threat?

Posted on by
Reply

 

So, the Summit for Democracy has come and gone. Much commentary preceded, accompanied, and then followed this December 9th and 10th gathering. Truth be told there is a continuing stream of observations still. Various countries openly applauded the Summit though unsurprisingly those uninvited pushed back starkly including in the case of China holding a conference of many of the uninvited.

The lingering question for the global order and its key participants remain: what does this Summit announced early on by then presidential candidate Joesph Biden tell us about current US foreign policy; what is Biden’s strategic policy framework particularly in relationship to China and Russia – the two most evident rivals and authoritarian states; and what is the conclusion drawn by close US allies and partners? What has been gained; what has been hindered and harmed?

The lack of clarity over the purpose of this Summit is fairly evident. This Administration has left seemingly a variety of presumed goals ‘on the table’. It appears in fact as though  the Administration identified at least three goals: an anti-corruption initiative; a protection of human right and more broadly a protection of democracy; and an autocracy versus democracy foreign policy approach, presumably part of a US democracy promotion goal.

On the democracy protection front the Administration offered a number of policy initiatives, including funding: As President Biden identified these efforts in his opening remarks:

Working with our Congress, we’re planning to commit as much as $224 million[$424 million] in the next year to shore up transparent and accountable governance, including supporting media freedom, fighting international corruption, standing with democratic reformers, promoting technology that advances democracy, and defining and defending what a fair election is. 

This initiative was part of the US effort to encourage all participants to set goals and report back in a follow up on these commitments. As the President expressed it:

… and to make concrete commitments of how — how to strengthen our own democracies and push back on authoritarianism, fight corruption, promote and protect human rights of people everywhere. To act. To act. This summit is a kick-off of a year in action for all of our countries to follow through on our commitments and to report back next year on the progress we’ve made. 

Still the clarity surrounding the Summit was never very evident to most.  Indeed there appears to be no agreement on the nature of the declared initiatives . Observers have taken the above to be democratic promotion and not protection.  This multiplicity of goals and their accompanying confusion have enabled experts, officials and commentators to choose their own goal from the menu of options offered by the Administration. Ben Judah at the New Atlanticist described one view of the Summit: Continue reading →