China: The great uncoupling

Beijing wants to foster a world where Chinese standards replace those of the post-1945 US-led system.

BEIJING, CHINA - JUNE 28: Dancers perform during a gala show to celebrate the 90th anniversary of the founding of the Communist Party of China (CPC) in the Great Hall of the People on June 28, 2011 in Beijing, China. This year's celebrations will mark the 90th anniversary of the founding of the CPC.
BEIJING, CHINA - JUNE 28: Dancers perform during a gala show to celebrate the 90th anniversary of the founding of the Communist Party of China (CPC) in the Great Hall of the People on June 28, 2011 in Beijing, China. This year's celebrations will mark the 90th anniversary of the founding of the CPC. (Photo by Feng Li/Getty Images)

As China entered its eighth decade of Communist Party rule in late 2019, the message from the apex of power in Beijing was plain – to realise the concept of a great nation with an exceptional global role. If the world was ‘in the midst of change on a scale not seen for over a hundred years’, as the country’s leader, Xi Jinping, put it, this presented an opportunity to realize the ‘China Dream’ of progress and greatness. It would be a challenge but, evoking Mao Zedong and the Long March, he portrayed the test ahead as a nation-strengthening process leading to victory.

‘Achieving a great dream takes a great struggle,’ Xi told a meeting of senior cadres in the autumn of 2019. ‘These struggles are not short-term but long-term; they … will not be small: economic, political, cultural, social; building an ecological civilization, national defence and building the army… foreign relations work, party building and others.’ That vision, drawing on history through the legacy of the Chinese empire but firmly rooted in a 21st century ideology of power, is now the essential guiding policy for the last major state on earth still ruled by a Communist Party and so forms a key element in the evolution of global relations as the world struggles with the crisis unleashed by the Covid-19 pandemic.

‘Socialism with Chinese characteristics’

Nobody can say they had not been warned about the course the leadership of the People’s Republic (PRC) intends to follow, or its determination to carve out a specific course for itself in the 21st century. In a speech to a closed Party meeting soon after taking the country’s top office eight years ago, Xi talked of working for ‘the eventual demise of capitalism and ultimate victory of socialism’. A Central Committee document drawn up in 2013 called for ‘intense ideological struggle’ to achieve ‘the great rejuvenation’ of the Chinese people with the rejection of Western principles such as constitutional democracy, universal values, neo-liberalism, promotion of civil society and freedom of the press.

At the Communist Party’s five-yearly congress four years later, Xi set out the PRC’s ambitions to become ‘a global leader in terms of composite national strength and international influence’ by the mid-2030s. The PRC would move to the centre of the world stage while ‘Socialism with Chinese characteristics’ blazed a new trail. At home, the leadership reversed Deng Xiaoping’s moves towards separation of powers between Party and government to the benefit of the first while, abroad, it decided that the time had come to abandon his advice that the People’s Republic should ‘hide its brilliance and bide its time’ as it drew on the rest of the world to build up its strength.

Yet, as imperial dynasties discovered in the past, long-term visions often run up against more immediate road blocks. In China’s case, significant short-term challenges were plain to see at the turn of the decade. Spectacular as its emergence from Mao-era backwardness and isolation had been, the image of an all-conquering nation on its inevitable path to ruling the world did not stand up to close examination. That might not fit the “China Dream” narrative propounded by the leadership, but it was one which would present Xi and his colleagues with a choice of direction when the 2020 crisis unfolded.

Superpower overreach

The economy, whose explosive expansion had been at the core of the regime’s evolution since the post-Mao reforms launched by Deng in the late 1970s, was slowing down even before the pandemic hit. As growth declined, concern rose about legacies from the era of turbo-charged expansion such as the debt mountain built by the huge expansion of credit. Despite the pledge of create ‘a moderately prosperous society’ shared by the population at large, wealth distribution has been highly unequal with gaping disparities between the mass of the rural population and the urban middle-class. The People’s Republic risked being stuck in the middle-income trap as development stalled, vested interests sheltered under the political apparatus and consumption was stunted by the need for high savings given lack of a fully-fledged welfare system. The pace of economic reform had decelerated markedly. The private sector, which created the bulk of growth and jobs, had been relegated to the back seat as the reach of the Party State expanded.

Despite its advance in such key areas as big data and 5G communications, mainland China lagged in some vital sectors for modernization, notably advanced semi-conductors. Its population was ageing fast. Though the government was paying increased attention to the environment, the legacy of pollution from the years of heedless industrial growth remained a major problem. Repression of dissent had been stepped up and the mass forcible “re-education” of the Muslim Uyghur population aroused international criticism.

Under Donald Trump’s presidency, the most important global relationship – with the United States – had moved decisively from the “constructive engagement” of the past four decades to one of “strategic rivalry” as China was depicted as the symbol of the downsides of globalisation. Nor was it only the White House that took a critical view of the People’s Republic; Democrats joined in the chorus and though American companies might still value the mainland market, opinion surveys showed only a quarter of Americans regarding China favourably. From trade and tariffs, the confrontation had spilled over into the technology China needed to build up its advanced industries and modernize its armed forces, with the giant Huawei company a prime target.

In Hong Kong, protests, directed at Beijing as much as at the local government, continued unabated through the second half of 2019 after pro-democracy candidates swept the board on district councils and were poised to do well in polls for the local legislature the following autumn. In Taiwan, the autonomist DPP president was on her way to re-election with a heavy majority in early 2020. The US was conducting freedom of navigation exercises in Asian waters claimed by China and strengthening its presence in the Indo-Pacific region, notably with India. South-East Asia countries resented China’s expansion in the South China Sea. The global Belt and Road Initiative (BRI) of Chinese aid was running into problems in some key countries, with some recipient governments backing out of projects and chafing under the debts incurred with Chinese banks.

Then, as the year ended, came the virus outbreak in Wuhan. This raised fresh questions about the ruling system as the authorities proved slow to react effectively. Governments in developed nations took a fresh look at China, both politically and economically once the virus spread towards them. Donald Trump blamed the PRC for the spread of ‘the plague’ and attacking China became a major ploy for the November elections.

As the scale of the challenge represented by the pandemic became clear and the Chinese economy was crippled by the draconian lockdown deemed necessary to win the ‘People’s War’, a different leadership in Beijing might have been induced to relax on some other fronts, if only to gain breathing space. Apart from the health challenge, the economic outlook was dire given the way the outbreak depressed both domestic and external demand while raising the danger of mass unemployment, social instability and the loss of the Party’s main practical claim to rule.

Prudence might, therefore, have prompted a more emollient global attitude from Beijing as a report from the State Security Ministry showed anti-China sentiment abroad at a thirty-year high. If reviving ‘constructive engagement’ with Washington seemed impossible, then at least the PRC might seek to nurture partnerships with governments which felt they had been left adrift by the Trump administration’s go-it-alone approach and looked to China as a helpful partner in times of global stress.

But that was not to be. It did not fit the concept of supremacy that had become baked into the political machine which ran the PRC. Instead, the pandemic proved to be a watershed flowing directly from the new, tougher vision of China’s objectives and how to pursue them, accelerating the drive to show the superiority of the PRC model of governance and tighten the leadership’s grip on power.

Xi was up front about the opportunity which the ‘People’s War’ against the disease offered to show ‘the significant advantages of the leadership of the Communist Party and the socialist system with Chinese characteristics’, as he put it in a tele-conference with 170,000 Party cadres in January. After initial slowness to act and cover-ups, the General Secretary assumed the role of commander-in-chief. Blame for any short-comings was loaded on to the local government in Hubei province who were replaced by envoys from the central apparatus. The Party, alone, could be the source of national safety and salvation. Messaging that deviated from the approved version was repressed. Independent bloggers were silenced. The ‘Chernobyl Moment’ of popular alienation from the regime forecast by foreign commentators was choked off under cover of the massive lockdown while attention shifted to reviving the economy and clamping down on any threat of a second wave of the pandemic.

Foreign criticism of the initial failure to limit the spread of the disease and of the way it then spread outside China prompted a defiant response even as Beijing stepped up its supply of medical equipment abroad, some of it on a commercial basis and some as aid, some of it gratefully received and some found to be sub-standard. As relations with the West sharpened and the Republicans adopted anti-China messaging as a prime theme for the presidential election, Beijing heightened its rhetoric, seeking to divert attention from the origin of the disease and initial shortcomings to the less impressive record of foreign governments in controlling the pandemic once it spread across the world.

A Foreign Ministry spokesman suggested the virus might have been imported by a US team competing in a military sports competition in Wuhan. Foreign food imports and travellers from abroad were blamed. ‘Wolf Warrior’ diplomats at Chinese embassies attacked their host governments. Australia was subjected to sanctions on grain exports to China when it called for an independent investigation into the origin of the virus. With a pledge of $2 billion to fight the virus, China set itself up as the champion of the WHO as the US prepared to leave the global body, accusing it of having bene taken over by the PRC. Official media homed in on the fast-escalating death toll in the United States and contrasted this with the numbers in China; when protest welled up in American cities after the killing of George Floyd in the early summer, anti-US Party and State propagandists had a field day.

The Chinese leadership, meanwhile, did not let the pandemic slow down its pursuit of plans in other directions. Indeed, the crisis offered useful cover for action while other countries that were pre-occupied in fighting their own outbreaks. So, the spring and summer of 2020 saw a flurry of activity that took little or no account of the reactions it evoked, and cemented the tougher policy approach which had been brewing in Beijing through the previous decade.

Relations with the United States plunged further with Beijing giving no ground in response to criticism of its handling of ‘the China plague’ from President Trump and Secretary of State Pompeo. Purchases of American farm products, energy and industrial goods under the Phase One trade agreement signed in January ran well below the agreed levels as the PRC ramped up buying from Brazil as an alternative (and cheaper) supplier. Apparently unwilling to make the final break with the PRC, Trump still pointed to ‘the great deal’ he had made on behalf of American farmers. He remained vague on what threatened sanctions over Hong Kong would entail while the Commerce Department relaxed some of its prohibitions on Huawei. Observing the rift between the Trump administration and US allies in Europe and Asia, China showed every sign of going its own way regardless of pressure from Washington, counting on domestic economic and electoral pressure in the United States to hold the President back from the brink whatever his rhetorical outbursts.

A new era in US-China relations

US-China relations have thus entered a new phase in which Beijing is ready to move towards disengagement and reduced dependence on the power across the Pacific – if not complete decoupling. This may have come sooner and been more radical than the PRC leaders had expected thanks to the virus and Trump’s re-election tactics. But, while the President’s tariff war followed by musing about the prospect for unravelling the whole relationship with the PRC kept the spotlight on him, China was also re-setting its course to reflect its own priorities and the buttressing of its system that was the leadership’s first concern as the Communist Party matched its domestic concentration of authority with external power projection.

At its annual plenary session (delayed by the virus till late May), the rubber-stamp legislature, the National People’s Congress (NPC) drew up national security legislation for Hong Kong designed to bring the former British colony to heel and choke off the pro-democracy movement by riding rough-shod over the ‘One Country, Two Systems’ formula adopted at the 1997 handover from Britain. Ignoring promises of ‘a high degree of autonomy’ for the territory until 2047, the move unabashedly asserted the primacy of the ‘one country’ to do as it wished, reinforced by the presence of mainland security agents and suggestions of special courts. This could only strengthen concern about the extension of mainland Chinese norms to the city and the impact on the rule of law there, not to mention raising doubts about its future as an international financial centre if it became ‘just another Chinese city’.

China stepped up maritime pressure on Malaysia, Vietnam and Indonesia in the latest round of its expansion in the South China Sea, as well as giving reefs and atolls Chinese names. Planes and warships undertook patrols menacingly close to Taiwan, in some cases intruding on its air space, while Beijing’s language about reunification grew tougher – with a senior PLA general reviving talk of mounting a military attack on the island if there was no other way of heading off independence. In the Himalayas, the People’s Liberation Army (PLA) conducted exercises on the disputed border with India and fought frontier clashes that left dozens of soldiers on each side dead.

The budget for the People’s Liberation Army (PLA) was boosted by 6.6 per cent; Xi, who is Chair of the Central Military Commission, told the military to ‘think about worst-case scenarios, scale up training and battle preparedness’. Spending on instruments of power projection such as the navy and the missile force was increased while Xi paid constant attention to ensuring the PLA’s loyalty to the regime.

Continuing the Leninist concentration of Communist Party power that has been a hallmark of Xi Jinping’s years in power, a new top-level security group was established under Politburo control. Central control was increased in the name of fighting the virus. Journalists from major US news organizations were expelled.  Chinese bloggers who raised questions about the handling the virus were detained along with several more prominent critics of the leadership. On his 67th birthday on June 15, 2020, the Party journal, Seeking Truth, added to the cult built up around the leader by declaring that his teachings known as Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era was ‘Marxism for the 21st Century’.

The Chinese state sets its own course

It is now half-a-century since Richard Nixon opined (in a Foreign Affairs article before he won the presidency) that ‘We simply cannot afford to leave China forever outside the family of nations… the world cannot be safe until China changes.’ His successors, Republican and Democrat, along with many other Western leaders, generally based their China policy on the belief that, as the People’s Republic became richer and more globally connected, it would become ‘more like us’. Given the Communist Party’s focus on power and self-preservation, and China’s long history of regarding itself as an exceptional nation poised between Heaven and Earth, this was always a mistaken belief. But is only now being recognized as a mirage fostered by mutual overlapping interests that have been overtaken by political and ideological drivers.

Beijing’s present policy path means that it is quite ready for conflict – open or tactic – with the nations whose co-operation Deng saw as necessary to the PRC’s positive evolution. China does not want to exclude itself from international affairs; on the contrary it wants to foster a world where Chinese standards replace those of the post-1945 US-led system. Above all, the leadership does not accept the need to be part of a family of nations led by the United States as was the case during its economic rise that depended heavily on globalisation and opening up to international forces. A China-centric world increasingly free of over-lapping interests with foreign powers is the aim, and this is seen in Beijing as attainable so long as the PRC sticks to its guns, defends its red lines of national sovereignty and plays on divisions among states which formerly marched in step with the United States.

After four decades of growth, the economy remains key to the regime’s health, but the leadership believes it does not need to play second fiddle to any other power and can assert what it sees as China’s time for global greatness. This may lead it to over-estimate its own strength – the PRC remains shot through with flaws while the disarray among the democracies may not persist. But the world is shifting even as it fragments, and China is set on its course, whatever the outcome.


Jonathan Fenby