Country Report: China (June 2020)

Danielle F. S. Cohen (assisted by Dong Jiaxin)

In the spring of 2020, Chinese analysts began to grapple with the implications of the COVID-19 pandemic for the future world order, Sino–US relations, and China’s relations with South Korea and Japan. They also continued to assess China’s global governance approach by examining its relationship to China’s national identity, exploring its connection to China’s overarching foreign policy strategy, and evaluating the importance of China’s pursuit of global discursive power.

The Impact of COVID-19

In a forum featured in Shijie Jingji yu Zhengji, No. 4, 2020, Zhang Yuyan assessed the implications of the COVID-19 pandemic for the world order, with a particular focus on its likely economic consequences. So far, Zhang argues, the pandemic has accelerated and delayed various aspects of the historical processes that began after the 2008 Global Financial Crisis, but has not fundamentally altered their course. Consequently, the pandemic has had less impact on the fundamental world order than have other significant global turning points, such as the post-Cold War shift from a bipolar system to a system of a single superpower and many strong countries, and the faltering of this system after the 2008 Global Financial Crisis. Nevertheless, the economic damage from the pandemic will be enormous as global production and supply chains are interrupted and countries shift toward more self-sufficient strategies. Zhang contends that China’s apparent success in its initial battle against COVID-19 (the article was written after the virus had been stamped down in Wuhan and before its June 2020 reemergence in Beijing) has worried some nationalist and conservative observers overseas, especially in the United States, who fear that China will surpass the United States. While these observers originally advocated locking China into lower positions in global industrial chains, they now increasingly advocate “decoupling” these chains entirely. In this context, China and the developed countries are moving toward parallel systems, centered, alternatively, around China and the United States.

In Zhang’s view, the domestic economic situation in each country influences future world patterns. He asserts that the unconventional economic responses the developed countries took in response to the 2008 Global Financial Crisis created the conditions for the next major economic crisis. This response was characterized by “three lows and three highs”: low growth, low interest rates, and low inflation; and high capital prices, high debt, and high income inequality. Government interventions temporarily stabilized the stock market, but did not fix these basic underlying weaknesses. This fundamental fragility, Zhang argues, is the reason that economies have collapsed in the face of COVID-19 (although it is difficult to imagine how even the strongest economies could easily respond to a sudden, drastic drop in consumer demand and interruptions in production and supply chains brought about by widespread worker illness). Zhang contends, pessimistically, that the current economic troubles are just a preview of a future major collapse. In some countries, particularly middle-low income ones, the epidemic is destroying people’s livelihoods and may result in social disorder, government inefficacy, and a loss of border control, with countries unable to prevent the transnational spread of the virus.

Looking to the future, Zhang imagines four possibilities for the future global structure. The most dire, but unlikely, scenario is that the pandemic completely destroys the current multilateral global and regional systems. As countries use their power to shift their problems onto others, a Hobbesian world will emerge. A second possibility is that multilateral and global systems will collapse or continue on in name only, and there will be a shift toward regionalism as major powers compete with each other. Some existing regional structures will be strengthened, others will be reorganized, and still others will disappear. A third possibility is that two or three parallel systems will emerge, characterized by the decoupling of industrial chains. In the most optimistic scenario, globalization will be reinvigorated. Countries will recognize that COVID-19 is a shared enemy, embrace the concept of a community of common destiny, and cooperate to improve the global multilateral structure. Even though the pandemic has exacerbated anti-globalization forces, Zhang concludes that the future will depend on governments’ choices. Leading countries must resist the urge to compete with each other and must work together to overcome the current situation.

A second contributor to the forum, Ni Feng, focuses on the impact of COVID-19 on the United States and on Sino–US relations. Ni sees the pandemic as a huge shock to the United States, on par with the terrorist attack of September 11th and the 2008 Global Financial Crisis. He notes the severe economic damage it has already done and the extent to which it has brought US society to a halt. Ni argues that the pandemic has already produced a wide variety of effects in the United States, including increased nationalism and xenophobia; further aggravation of political polarization; social unrest tied to widespread unemployment; a return of big government; and constraints on individual freedoms. After a slow start by the Trump administration, the US government is now focused on combatting COVID-19. Although Ni speaks approvingly of the “quick action” by Democrats and Republicans to pass the CARES Act (Ni is probably more impressed by this “unified” response than many Americans), he recognizes that the pandemic has led to major political disagreements in the United States. The public’s assessment of the Trump administration’s pandemic response will likely decide the 2020 election. Meanwhile, tensions have flared between the federal government and the various state governments.

Turning to the impact of COVID-19 on Sino–US relations, Ni argues that the Trump administration is continuing to pursue an “America First” policy, even though the pandemic requires a unified global response. The United States is largely absent from efforts to coordinate global strategy and tries instead to shift the burden to other actors. Furthermore, Ni contends that even in this dire situation, many US political elites and media outlets continue to portray China through the lens of great power politics. He asserts that some in the United States are even using the pandemic as an opportunity to check China’s rise, although the single report he cites as evidence was published in early February 2020, when US understanding of the pandemic was still minimal, and does not make any mention of COVID-19.

Nevertheless, Ni argues that continual US provocations of China pose a significant hurdle to bilateral cooperation to defeat the virus. US officials have repeatedly used the epidemic to “slander” China and portray it as weak. Ni is critical of Secretary of State Mike Pompeo’s efforts to blame China for covering up the initial Wuhan outbreak and failing to contain it and is rightly disturbed by Donald Trump’s unhelpful references to COVID-19 as the “China virus.” However, his criticisms of the US media coverage seem largely to center on their legitimate descriptions of its real effects. For example, he objects to The New York Times’ statement that the pandemic will seriously damage the Chinese economy and The Wall Street Journal’s depiction of African and Asian countries as “victims” because of their close economic ties to China. Ni feels that these negative portrayals of China contribute to deteriorating support for China among the US public.

Ni is also concerned about the pressure the pandemic is placing on bilateral trade and economic relations. After a tortuous process, the United States and China finally reached a trade agreement on January 15, 2020, just as the pandemic was beginning. Hopes that the agreement might signal an upswing in bilateral economic relations have been dashed, as the pandemic has accelerated the US push for an economic “decoupling” from China. Furthermore, Ni contends that the United States has continued to advance its Indo–Pacific strategy, which is premised on a view of China as a strategic competitor.

Despite his concerns, Ni expresses hope that the two countries will cooperate to defeat the virus, noting their past cooperation on transnational challenges including the 2008 Global Financial Crisis, climate change, and Ebola. He believes that many Americans analysts already recognize the importance of working together and that Xi is pursuing a cooperative strategy. Consequently, he puts the onus on the US government to change its approach and take actions that will improve the bilateral relationship.

A third contributor to the forum, Yang Bojiang, examines trilateral cooperation between China, Japan, and South Korea in response to COVID-19 and the implications for regional governance in Northeast Asia. Overall, Yang argues that the three countries have worked together closely since the pandemic began, especially through Sino–Japanese and Sino–South Korean bilateral efforts. The countries’ respective disease control and prevention agencies have coordinated tightly, and the countries’ leaders have agreed on the need to jointly work to contain and mitigate the virus, coordinate various policies (including those that will stabilize production and supply chains), and encourage information sharing between economic and public health bureaucracies.
This cooperation offers an opportunity to promote feelings of amity among the publics of these three countries. Although Japanese–South Korean relations are still weaker than the other bilateral relationships, Yang believes that their cooperation on the pandemic is promising. He notes that the Japanese media have openly praised South Korea’s transparent COVID-19 response and that the South Korean public did not seem particularly concerned by the Japanese government’s decision to ban travelers from South Korea in March (a decision that the South Korean government denounced and that led it to impose a reciprocal travel ban). The three countries have worked hard to implement effective preventive measures, drawing on the strong public health systems in Japan and South Korea and lessons from China’s experience with the initial outbreak in Wuhan. Prior to this outbreak, the three countries already had mature, cooperative surveillance and response mechanisms that they had developed in response to earlier public health challenges, which have allowed for the timely sharing of information and effective containment and mitigation measures.

Yang is optimistic that trilateral cooperation on COVID-19 will deepen cooperation in other issue areas. All three countries face the dual challenges of ensuring public health and keeping their economies functioning. Yang encourages the three countries to take a number of steps to increase their mutual ability to manage the pandemic: establish a specific pandemic response mechanism; coordinate port inspections and ease business travel between the three countries; strengthen the sharing of big data on topics like treatment protocols; strengthen cooperation on medical research so that work can be divided up and tackled efficiently; and conduct research and development on COVID-19 prevention and management products, which should then be produced in the region. Writing in April, when the region seemed to have largely contained the virus, Yang argued that the three countries would be able to revive normal manufacturing sooner than the United States and Europe. He urged the three countries to deepen their economic cooperation by stabilizing supply chains, advancing negotiations on the trilateral FTA, and signing RCEP. Yang also advised the three countries to extend institutional cooperation mechanisms developed for the pandemic response to other non-traditional security issues, such as the environment, terrorism, and the aging population.

Looking ahead, Yang sees the pandemic as an important opportunity for China, South Korea, and Japan to strengthen regional governance. Yang urges the countries to reject the Western model of regional governance, which, he argues, is based on concepts like balance of power or hegemony. This approach will allow them to avoid conflict and enable them to focus on less sensitive areas for cooperation at the outset. Neither isolationism nor a governance structure centered around a strong power will succeed; rather, regional governance should be built from multilateral mechanisms. Although the three countries have a long history of institutionalized cooperation that can provide a strong foundation for more robust regional governance, Northeast Asia has traditionally been characterized by great power struggles. The importance of cooperation on both public health and economic policies in light of the pandemic offers the countries an opportunity to alter this trajectory. This new regional governance structure should be grounded in the history and culture of East Asia, rather than copying the European power-based approach. The three countries should learn from the ASEAN model of “flexible, multilateral coordination” and should commit to pragmatic, gradual progress.

In Riben Xuekan, No. 2, 2020, Gao Hong assesses Japan’s COVID-19 response and its influence on Sino–Japanese relations. According to Gao, Japan has a strong system for managing public health emergencies, but this bureaucracy has sometimes inhibited its ability to respond to the pandemic. Japan’s response to the Diamond Princess fiasco, a novel and delicate situation that touched on the interests of many other countries, was overly passive. Nevertheless, Gao is largely upbeat about the potential of the pandemic to improve Sino–Japanese relations.

Gao argues that China and Japan have demonstrated a strong urge to help each other defeat the virus. The goodwill toward China of both the Japanese government and the Japanese people since COVID-19 emerged has been evident and demonstrates both the humanitarian spirit of the Northeast Asian countries and their recognition of the importance of working together. The Chinese government and the Chinese people recognize and appreciate the substantial assistance Japan provided as the virus first hit China. As the virus spread to Japan, China returned the favor. In Gao’s view, the two countries’ joint efforts to defeat the virus have demonstrated the importance of China’s community of common destiny concept and embodied the East Asian cultural value of working together in harmony. The two countries have also demonstrated their willingness to cooperate to overcome shared threats, which has increased the level of amity between their publics. In this way, COVID-19 has created space for new thinking in Sino–Japanese relations.

Global Governance

In Taipingyang Xuebao, No. 4, 2020, Li Zhiyong explores how China’s understanding of its international position drives its approach to global governance. According to Li, each country’s international position is determined by its international identity and its international behavior. A country’s international identity encompasses three key aspects: its power or “actual strength,” based on military and economic indicators, and the extent to which other international actors recognize this; its integration into the international system and participation in international organizations; and the extent to which its values and culture are accepted by others in the international system. A country’s international behavior is influenced by its objectives and its strategy.

Drawing on a content analysis of 54 statements about global governance made by Xi Jinping between 2013–2018, Li assesses China’s official understanding of its international position. He argues that China has developed a composite identity as a “great developing socialist country” from several component parts. China has two contradictory impulses regarding its assessment of its global strength. Since reform and opening, China has emphasized its identity as a developing country. This impulse has continued, even as China has become the world’s second largest economy, and, in Li’s view, limits China’s leadership in global governance. More recently, China’s rapid economic rise has caused it to identify as an emerging market. Li traces the origins of this identity to China’s engagement with the G8 in 2003, and argues that it gained wider acceptance in China after the 2008 Global Financial Crisis. A third component of China’s composite identity is its vision of itself as a responsible great power. Li describes this identity as the most recent step in a series of transformations in PRC foreign policy from revolutionary to isolationist to integrationist and, now, to leading or guiding global affairs. Li contends that this identity has developed both from changes in China’s view of itself and from global support for China’s behavior, beginning with the Asian Financial Crisis. This tendency has become much more pronounced under Xi. Finally, China sees itself as having a particular set of values that derive from its identity as a modern socialist country. In China’s view, a modern socialist country pursues cooperative, win-win relations with other countries, rather than relying on military strength and economic expansion.

On the basis of these identities, Li argues, China pursues a foreign policy that is characterized by two key objectives. First, China seeks to achieve the “great rejuvenation” of the Chinese people by engaging in global governance. As a result, China has adopted measures like the BRI that are beneficial for Chinese national interests. Nevertheless, Chinese leaders recognize that in an increasingly interconnected world, China cannot pursue its own national interests at the expense of other countries’ interests. This analysis has led the Xi administration to seek a second key objective: the formation of a community of common destiny. This approach encompasses a wide array of bilateral and multilateral arrangements, and consists of efforts to advance shared interests and recognize shared responsibilities so that all of humanity can benefit.

Li concludes by situating his analysis in the broader debate over whether China should “keep a low profile” or “strive for achievement.” Li argues that China’s divergent identities mean that it will adopt a complicated, multifaceted foreign policy approach. As a socialist country and a developing country, it must speak for other developing countries. Yet, as the world’s second largest economy and biggest socialist country, it must also try to change global governance structures to increase the representation and discursive power of the developing world. Unlike Jin Canrong and Shi Yusong, who argue that China should shift from “biding its time” to taking a more active role in international affairs (see the December 2019 Country Report: China), Li argues that the two foreign policy approaches are not mutually exclusive. Quoting Xi, Li argues that China must do its best, while also acting in accordance with its abilities. Consequently, China should persist in “keeping a low profile,” by acting in a humble, cautious manner, so as not to act prematurely or overextend itself internationally. At the same time, however, China can “strive for achievement” by taking the initiative where it has the strength to do so, focusing on development and increasing its discursive power.

In Waijiao Pinglun, No. 3, 2020, Sun Jisheng examines how China can increase its discursive power regarding global governance. Sun argues that cracks in the existing liberal world order and the apparent inability of current global governance structures to manage various problems have created competition among great powers as they seek to shape the future of global governance and the world order. China has increasingly prioritized taking a leading role in global governance since the 2008 Global Financial Crisis, and especially since Xi came to power in 2012.

Sun argues that the existing global governance deficit and insufficient international cooperation to solve shared problems aggravate competition over discursive power among countries. This competition has three main aspects. First, countries compete over ideas. According to Sun, global policies reflect particular sets of values. Like many Chinese analysts, Sun criticizes the current global governance system for reflecting Western values, such as unitary governance and instrumental rationality. By contrast, Sun argues that a Chinese approach draws from Chinese culture, tradition, and practices to advocate for a multifaceted governance structure that emphasizes diversity, inclusiveness, and mutual benefits, as demonstrated by the concept of a community of common destiny. Sun also argues that the power to shape the production of knowledge allows an actor to shape both the value concepts, systems, and norms that underlie global governance and the fundamental understandings of particular problems, such as those related to climate change or energy.

Second, Sun argues that countries compete over institutions, which she views as sites of power. A country’s institutional discursive power reflects its position and influence in the international system and determines its ability to take concrete actions in the international sphere. In the postwar era, global governance has mainly been multilateral, rule-based, and centered around institutions. Consequently, as China has embraced its rise, it has placed an increasing emphasis on obtaining international discursive power via international institutions. This competition between China and other actors focuses on rule-making, international mechanisms (such as various FTAs), international organizations, and the global order. In Sun’s view, all countries seek to create an order and rules that benefit themselves, although the results may differ in each issue area.

Finally, Sun argues that countries compete over discourse, which is both a medium of communication among people and a product of those interactions. This competition may involve alternative framings of an issue, which impact how it is understand and the urgency with which it is viewed. She also contends that countries compete to insert their preferred discourse into that of important platforms, such as the UN. In so doing, they exercise their capacity to promote their preferred discourse at a global level. Sun argues that global governance has historically reflected a Western approach, but that developing countries are now competing for a stronger voice.

Although developing countries like China still have much weaker discursive power than the developed countries of the West, and, in Sun’s view, are deliberately excluded and blocked by Western powers, China has been working hard to increase its discursive power. China is driven to do so by its increasing relative power, the growing influence of the G20, and its mounting sense of great power identity. Between 2009–2018, China joined more than 85 multilateral agreements, covering issues like labor protection, intellectual property, and the environment. China stresses the importance of creating new global governance institutions, such as the AIIB, and shaping rules, such as those developed under the auspices of the BRI. It also emphasizes the need to reform existing Western-created global governance structures so that they can better manage current problems, such as climate change, economic crisis, the refugee crisis, and, most recently, COVID-19. These structures have proven particularly inadequate to the moment as the United States steps away from its traditional role and the great powers seem unable to cooperate. In keeping with the standard Chinese position, Sun argues that China remains committed to respecting international law and the centrality of the UN, but also contends that global governance should be fairer and more equitable, and better represent the interests of developing countries. To this end, Sun argues that China should disseminate its cultural approach, as embodied in the community of common destiny and the principle of “shared consultation, contribution, and benefit.” Furthermore, China must participate in the competition for human talent so that it can place its officials in prominent global positions.

Looking to the future, Sun argues that despite recent Chinese advances in areas like climate change and economic policy, China faces hurdles imposed by the Western-created system and China’s own sense of inadequacy. To further strengthen its discursive power regarding global governance, Sun argues that China must take several key steps. First, China must strengthen its foreign policy. China should manage its own domestic affairs well, carefully evaluate existing global governance structures and mechanisms, increase its ability to provide global public goods, and persuade the international community to recognize its capabilities and successes. Second, China must also define and disseminate its own approach to global governance, emphasizing how it is consistent with shared values and morality. Third, China should strengthen its capacity to shape and create global institutions by starting with easier, less sensitive issue areas so that it can learn from its experiences. Fourth, China should make use of social organizations, as it already has through its cooperation with foreign NGOs on issues like AIDS, poverty alleviation, and illegal drugs. Fifth, China must cultivate human talent, particularly in specialized areas and international law. Finally, China must recognize that global governance is in an important period of adjustment as the world struggles to manage a variety of non-traditional security issues in the face of inadequate great power cooperation. Sun concludes that China must recognize that it has the right to reform the current global governance system, and that a failure to do so means it will again lose out to the Western powers.

 

#"Belt and Road" Initiative #2008 Financial Crisis #AIIB #COVID-19 #Japan-South Korea relations