Tag Archives: China

China, seemingly, stays the course

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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

Advancing Global Governance by Revitalizing a Regional Institution

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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.

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

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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

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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.

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The Current Narrative of the Chinese Communist Party’s Foreign Policy: “A Community of Shared Future for Mankind”?

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When it comes to China’s current foreign policy, phrases such as “Wolf-Warrior Diplomacy” (WWD) and “Belt and Road Initiative” (BRI) frequently appear. The name WWD originates from a Chinese film series, “Wolf Warrior”, which depicts a patriotic solider battling foreign powers and mercenaries. Nowadays, many refer to China’s increasingly strong statements and assertive diplomatic declarations as WWD.

On the other hand, BRI refers to global infrastructure development projects led by China to promote international cooperation, multilateralism, and trade. It may appear that these two sets of foreign policy approaches rather conflict. However, the phrase “A Community of Shared Future for Mankind” (人类命运共同体), a part of the official narrative of China’s foreign policy may have led to both of these contrasting approaches. What is “A Community of Shared Future for Mankind”? How does this phrase explain trends in China’s recent foreign policies including WWD and also BRI?

What is “A Community of Shared Future for Mankind”?

By literal translation, the above phrase means “A Community of Shared Fate for Mankind” (SF) rather than, as it is often expressed in English, “A Community of Shared Future for Mankind”. SF suggests a global order described by China’s President Xi Jinping encompassing the shared rights and responsibility of each nation in terms of “politics, security, economy, culture, and environment” in a globalized world. In President Xi’s words SF is: “to build A Community of Shared Future for Mankind [to] construct a beautiful and clean world with long lasting peace, general security, mutual prosperity, openness, and inclusivity”. At a United Nations Economic and Social Council (ECOSOC) meeting in July, 2020, China’s Foreign Minister Wang Yi argued that China will push to build SF by promoting multilateralism in accordance with international laws and “… denounce global hegemony and protectionism”. These and other  remarks by China’s leaders demonstrate, it would seem, the Chinese Communist Party’s (CCP) ambition to achieve greater global influence, and that China is prepared to work with all nations to build a SF. Indeed, not all nations may be agreeable with the ideology of SF. It is inevitable that the CCP will face some frictions when it tries to expand the influence of SF in the world. Therefore, the CCP may have to use a tailored approach in its foreign policies to push its SF agenda.

SF as an Umbrella term for China’s Foreign Policy

President Xi has publicly made statements such as “[the CCP] will reference history and create the future. It must continuously push and construct A Community of Shared Future for Mankind”. Under this guidance, top Chinese officials have made clear that China’s foreign policy will revolve around SF. China’s approach to global order, then,  promotes politically correct topics such as climate change, global disparity, and it also opposes terrorism and hegemony. Although it encourages cross-cultural exchange, it makes no explicit mention of protecting the rights of marginalized communities. The vague language in the SF permits CCP officials greater flexibility in deciding what kind of matters are consistent with the SF and therefore align with President Xi’s agenda.

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How Japan Can Navigate Growing US-China Tensions

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US-China tensions have emerged to dominate the geopolitical space. How is this rivalry affecting states, particularly in the Asian context? Japan, a long-standing ally to the US, and at the same time a key economic partner to China, finds itself, as do other states in the region, in a difficult position. Still the US-China rivalry alone fails to fully define the foreign policy challenges Japan faces currently. With the Olympics just recently completed in Japan, and COVID-19 numbers on the rise, vaccination numbers still relatively low, continuing cool relations with South Korea, nuclear tensions with North Korea, and finally a looming national election, it is important to recognize that there are a variety of serious issues that Japan’s current political leadership faces.

The US provides Japan with defence and security, but China boosts the Japanese economy, with 22% of Japanese exports going to China in 2019 alone and increasing another 5.1 percent in 2020. Japan is wary of losing its status as a major power but understands that choosing between the two superpowers is surely a lose-lose proposition.

Territorial Disputes

Territorial disputes are a long-standing issue for Japan. Between 2010-2012 tensions began escalating with China over the Senkaku Islands in the East China Sea. However, while the Senkaku Islands remain an area of contention, the question of Taiwan is a cause for even greater concern. Japan’s southernmost island, Yonaguni, is just some 111km east of Taiwan, and in recent months, China’s presence around Taiwan has grown. Threats have increased. In April 2021, when Prime Minister Suga visited President Biden in Washington, their joint statement on the renewal of the US-Japan partnership mentioned “Taiwan” for the first time since 1969: “We underscore the importance of peace and stability across the Taiwan Strait and encourage the peaceful resolution of cross-Strait issues.”

Beijing responded harshly to the statement and accused the US of interfering in “internal affairs”. For a country like Japan, a response of this nature raises concern: China’s been known to utilize economic means to retaliate against countries that condemn their actions. Therefore, while it may be important for Japan to collaborate and work with the US on matters relating to Taiwan, Japan is treading quite carefully with China.

Former Japanese Prime Minister Yukio Hatoyama argued that the US-Japan Joint Statement’s mentioning of “Taiwan” was counterproductive to seeking cooperative relations with China. However, various US military officials in the Indo-Pacific have argued conflict between China and Taiwan is highly probable in the next six years. Given Japan’s proximity to Taiwan and the US’s presence in the region, Japan must consider the wider geopolitical implications.

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Biden, Suga, Xi and Yes, Others – the New Mix Reshaping Global Order Relations

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The current state of the international system. That is what I hope RisingBRICSAM can tackle in the next set of posts. While I remain the named blogger here at RisingBRICSAM,  I shall not be undertaking this task alone. Nope. I have been fortunate enough these past weeks to be working with a great set of recent, or near MGA graduates from the Munk School of Global Affairs & Public Policy, University of Toronto.

And all of us in various ways have had  opportunities to examine in some detail aspects in the evolving global order. In addition, many of these same researchers have joined in the China-West Dialogue (CWD) research and online meetings. But more on that in a moment.

 

There is as you will see a host of significant influences shaping the global order and its politics. Probably the most immediate has been Covid-19. The waves of the virus have had a significant influence on all the major and minor actors in the global system.

The global public health crisis has also underscored the growing array of new actors in the global order. Of course the many states – leading powers, major powers, emerging and developing powers, and also the international organizations both formal and the often forgotten but in fact critical informal institutions.

The array of these state actors have been significantly supplemented during the pandemic by sub-state actors – whether regions, networks or local actors and even more dramatically non-state actors such as foundations, public and private corporations.  The pandemic has underscored the growing role of technology and digital organizations. One of the envisaged posts will focus on the global developments of Agenda 2030 – the 17 Sustainable Development Goals (SDGs) – and the threat that the Covid-19 pandemic has posed to achieving these critical global development goals by the end of the decade.

The virus has been dramatic globally. But then as well has been the replacement of the Trump Administration and its ‘America First’  foreign policy in the United States with the Biden Administration’s autocracy versus democracy and build back better world (B3W). Both administrations grappled with, or amplified, the reemergence of geopolitics with the intensifying rivalry between the United States and Xi Jinping’s China. Even in these early months, the Biden Administration has represented a highly different domestic and diplomatic effort from the often chaotic years of Trump policies though it appears the Biden Administration has moved slowly on revising aspects of American foreign policy including with China. Some of the early and continuing analysis and research at the Global Summitry Project (GSP)  on US and US-China foreign policy has been undertaken by the China-West Dialogue Project (CWD) co-chaired by Colin Bradford, non-resident senior fellow from Brookings and myself. For almost two years we have met largely virtually with thought leaders – former officials, policymakers, academic experts – from around the globe to build a narrative that can accommodate competition, avoid confrontation and vitally permits collaboration – an approach that counters the ideological divisions that have emerged with rising US-China tensions.

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Measuring American Foreign Policy for ‘Competition without Catastrophe’: The Alaska US-China Summit

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With President Biden’s first official news conference last Thursday March 25th, the news conference brought the curtain down on the first meeting of top foreign policy officials from the United States and China. The public side of the Summit was a rather fiery uncooperative back and forth between the leading government officials from both China and the United States. We are led to understand, however, that the private meetings that went on into the next day were more productive. And with both encounters past, the shape of the competition between China and the United States began to take some public shape.

For some time now we have been made aware that a more confrontational  approach in US-China relations was likely. As David Sanger describes in a recent NYT article, the ‘Washington beltway’ view has crystallized around a far more competitive foreign policy with China. And the Biden foreign policy has reflected, seemingly, this rare political consensus:

For a president barely 10 weeks into office, casting the United States as confronting a global struggle with the Chinese model has some clear political benefits. One of the few issues that unites Democrats and Republicans is the need to compete head-on with Beijing.

William Galston at Brookings reviewing American public opinion toward China underscores how American public opinion has turned against China particularly after the Trump years:

All things considered, the Biden administration will enjoy substantial public support if it places competition with China at the center of its foreign policy, and it will pay little price for the blunter rhetoric its senior officials employed during the recent meetings in Alaska with their Chinese counterparts. On the other hand, most Americans have not focused on the military dimensions of this emerging relationship and are not prepared for a possible conflict over Taiwan.

Advisors to Joe Biden during the election period, and many of these same folk now as officials for President Biden, are describing and clarifying US policy toward China that they had previously written about pre-election. The dominant position as articulated by the senior policy folk such as Jake Sullivan, now National Security Advisor to the President and Kurt Campbell now the ‘Asia Tsar’ is strategic competition, or slightly more poetically, ‘competition without catastrophe’ the title of their consequential 2019 FA article. Continue reading →

Washington’s Unfounded Fear of Biden Collaboration with China

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The Washington Beltway remains in a ‘tizzy’ over the direction of Biden foreign policy. Will Biden commit to the bipartisan ‘full-throated’ competition with China. Here, Ryan Hass of Brookings describes that continuing nervousness on the part of the foreign policy establishment over a possible Biden strategy : 

 

There are a variety of causes for these concerns. Some security-focused experts worry that the Biden administration will prioritize cooperation with China on climate issues above other strategic concerns. Others fear that by signaling interest in cooperation, the United States will show lack of resolve for long-term great power competition with China. Proponents of viewing the U.S.-China relationship as an entrenched ideological struggle worry that cooperation could dilute the focus on what they describe as each side’s irreconcilable ambitions. Some have shared concerns that Beijing will withhold cooperation on climate issues unless it receives American concessions in other areas of the relationship, for example, on Hong Kong or Xinjiang. Others worry that the Chinese are wily negotiators who will hoodwink their earnest American counterparts if given the opportunity. Still others argue that engaging the Chinese as peers on climate issues provides undeserved validation of China on the world stage and legitimation of the Chinese Communist Party at home.

Besides Ryan Haas at Brookings, concern about Biden’s China policy has also been raised by his colleague,  Thomas Wright. In TheAtlantic. Tom has suggested in a recent article that Biden’s choice of John Kerry as special presidential envoy on climate change may well create problems for the new Administration on the critical China file.  

Competition with China will likely be the most difficult foreign-policy issue that President-elect Joe Biden will face. What he decides to lead with and the precise mix of areas in which he engages and confronts Beijing are critically important. This is why Biden’s choice of John Kerry as a special presidential envoy on climate change might create a problem for the incoming president on China policy.

In discussions with Biden colleagues, Wright comments that they expressed concern over Kerry diplomacy. Kerry’s single-minded focus on climate change could, according to these colleagues, bring climate policy progress but sacrifice other security-related US-China matters. As Tom described his conversations with these Biden folk:

A former Obama administration official told me, “China’s diplomacy is a constant search for leverage, and Kerry will deliver a load of it in a wheelbarrow right to their front door every day.

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The March of Global Order

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This Post is a collaboration with Yves Tiberghien Professor of Political Science at UBC and RisingBRICSAM blogger Alan Alexandroff.both Principals at the Vision20. It underscores that key actors in Asia, Europe and elsewhere are not waiting on the United States to return to global collaboration and multilateral action.

Out of Asia there is a major push on various global governance fronts. The world is not waiting for the United States. And in fact Joe Biden, the President Elect and his people are going to have to think ‘hard’ about whether they are prepared to be ‘left behind’ in the march forward of various multilateral gatherings. Are the demands of domestic politics and the Democratic Party’s distaste for ‘free trade arrangements’ going to leave the Biden Administration lukewarm to rejoining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership or CPTPP? Lukewarm leaves the United States on the outside of efforts to integrate trade and investment in Asia and beyond.

While the Regional Comprehensive Economic Partnership (RCEP) is a limited integration of trade and investment, nevertheless the RCEP is the largest regional agreement concluded in Asia. The Pact covers 2.2 billion people and 15 countries . It includes China and other major economic actors including Japan and South Korea. As the NYTimes (2020) points out:

The pact will most likely formalize, rather than remake, business among the signatory countries. Its so-called rules of origin will set common standards to determine whether a final product qualifies for duty-free treatment, potentially making it simpler for companies to set up supply chains in several different countries.

While the RCEP lacks significant and needed steps to further liberalization and common regulation in key areas such as services trade, e-commerce, intellectual property protection and the elimination of manufacturing subsidies it is a key advance for the Asian region. As pointed out by Yves Tiberghien (2020) in a just published EastAsiaForum post:

RCEP will advance the acceleration of regional economic integration in Asia, and pushes back on Trump’s strategy of decoupling of US allies from China. While Southeast Asian countries, Japan, South Korea, and Australia may all be wary of China at the moment and seek diversity in their trade relations, they simply cannot sustain their prosperity without stabilisation of trade relations with China. Asia is criss-crossed by ever intensifying value chains, and China’s still an integral part of that. Vietnam and other ASEAN countries are rising as manufacturing hubs, but that’s a process accompanied by increased imports of intermediary goods from China.

But RCEP is also of global significance. The agreement, signed off in the middle of a pandemic and US–China trade war, reminds the world, first, that East Asia countries, unlike the Americas and Europe, have broadly succeeded in controlling COVID-19. That success, across different types of political regime, with a similar respect for science, expertise, and trust in government, was accompanied by general acceptance of mask-wearing and community rules.

Second, it also reminds the world that the biggest trading group in the world economy is doubling down on the rules-based multilateral system. Research by Homi Kharas shows that most of the increase in the global middle class until 2030 will take place in China and Asia.

 

RCEP also embeds the first trilateral agreement between China, South Korea and Japan, itself a huge deal. The common interests of these three countries have over-ridden tense geopolitical relations across the Asia Pacific. RCEP underscores the pragmatic efforts of Japan to balance its strong security stance on the South China Sea and in the East China Sea with stability in the bilateral relationship with China. After the completion of the CPTPP, the EU–Japan partnership, and the US–Japan agreement, this marks the completion of the Abe trade agenda (even though Japan would have preferred India to join RCEP). …

As well, RCEP brings significant institutionalization to Japan’s economic relations with China, including a new chapter on e-commerce (with a ban on data localisation requirements), rules on government procurement, and rules on intellectual property rights that go beyond WTO rules. The same calculations drive Australia’s readiness to sign RCEP in the midst of a bitter, but hopefully short-lived, trade fight with China.

The coming Biden Administration needs to rethink its reluctance to rejoin the CPTPP. If it fails to do this it could be on the outside of growing multilateral economic integration and possibly more.

Image Credit: Vietnam News Agency, via Associated Press.