A View from China

After a visit to Myanmar in January 2020, Chinese president Xi Jinping decided to forego foreign visits for more than two and a half years due to the COVID pandemic. During this time, China’s foreign policy apparatus grew relatively adept in virtual summits and meetings that afforded the paramount leader the possibility to stay engaged on the world stage. However, there is clear recognition that China has missed critical opportunities for direct diplomatic engagement, and to shape the international discourse about China’s relationship with the rest of the world. This self-imposed isolation has been due to domestic political priorities—Xi had been focused on securing his third term and full control of the composition of the top leadership at the 20th Party Congress. The sweeping victory was indeed achieved in October, which prompted Xi to rapidly move into a mode of diplomatic charm offensive in November.

Within a short period of time, China hosted leaders from Germany, Vietnam, Tanzania, Pakistan, and Cuba in Beijing for official visits. Xi also traveled to Indonesia and Thailand for the G20 Summit and APEC Summit, respectively. He met with multiple world leaders at the two multilateral events, including a long-expected summit with President Biden. The Xi-Biden summit in particular received keen attention worldwide. How to understand China’s foreign policy trajectory, especially how the Chinese see the overall direction of US-China relations, has become a key question for the policy community.

China’s foreign policy undoubtedly evolves around its domestic politics. The domestic challenges, including the economic slowdown and the vast social discontent related to the COVID lockdown across the country, will for the time being keep China preoccupied. This makes it less likely for China to focus on foreign policy initiatives or assertive actions abroad until the domestic upheavals come to a rest.

Biden-Xi Summit: Different Assessments

Unsurprisingly, Xi Jinping’s diplomatic charm offensive in Southeast Asia has attracted overwhelmingly positive reviews in China. In today’s political environment, one should not expect anything less than wholehearted praise for Xi’s first overseas trip since the 20th Party Congress. There are optimists and pessimists on the future of US-China relations, the most important bilateral relationship for China’s foreign policy playbook. Although the Chinese policy community is realistic enough to recognize that the overall trajectory of US-China relations has not fundamentally changed, there are some voices of optimism. 

The Optimists

For people who see the glass as half-full, the Xi-Biden summit, at a minimum, sent a positive signal to the world about the desire and willingness of both the US and China to manage and mitigate the chance of a military conflict. Their focus is not on specific technical issues, but on the effort to redefine and reorient relations on the strategic level. “Reassurance” is the keyword for the optimists. And Biden’s reassurance on “Five No’s and Four ‘No Intentions’” is seen as particularly important to amplify the concrete deliverables for Xi from the summit.¹ (The Chinese official readout includes: “the US does not seek to change China’s political system; does not seek ‘new cold war;’ does not seek to oppose China by strengthening alliances; does not support ‘Taiwan Independence;’ does not support ‘two Chinas’ or ‘One China One Taiwan.’ And the US has no intention to engage China in a conflict; to seek ‘decoupling’ with China; to obstruct China’s economic development and to contain China.”)

Although the optimists also acknowledge that the implementation of these nine points in real world US policy is near impossible, they still would like to argue that statements of positions are important in drawing the baseline, leaving the next important task to be “holding the US to its words,” especially holding the working level officials to the words of the president. For them, if the US and China could agree on their basic positions about China’s rise, its political system, and economic growth, the differences between the two would have been reduced from strategic divergence to tactical disagreements. On the issue of implementation, 2023 is seen as a year of relative stability because neither China nor the US has significant domestic political events, which will reduce the impact of domestic politics as an additional stressor for the bilateral ties.

For the positive momentum to continue, the optimists raised issues such as regularized senior-level visits; cooperation on practical issues; establishment of “safety valves” (guardrails) on crisis management; and people-to-people exchanges as potential areas for the improvement to come to fruition. Some also further raised the need to develop a new framework of strategic consensus about the endgame that the US and China should seek in their coexistence, although that task appears too grand and unrealistic at this current stage.

The Pessimists

One must wonder whether the optimists genuinely believe in the positive trajectory from now on, or is it a political mandate to say so to glorify Xi’s wisdom? Given the precarious state of US-China relations, optimism may not be the smart strategy in the long run. For the skeptical critics, the five virtual summits and phone conversations between Xi and Biden since 2021 similarly rendered positive commitments from the US, but they did not prevent the Biden administration from adopting unfriendly policies on Taiwan, trade, and semiconductor chips. The question is whether a face-to-face meeting will prove fundamentally different from the previous experience.

Citing the bipartisan consensus on China and the Democrats’ minor losses during the mid-term elections, the pessimists are incredulous about the ability of the Biden administration to reverse the trends already in motion between the two countries. Furthermore, there are also domestic political events beyond Biden’s control, including special investigations of China by the Republicans in the House or a visit to Taiwan by the expected new speaker of the house Kevin McCarthy. When those events take place, China’s inevitable reaction will heat up the tension once again.

Somewhere in the middle between the pessimists and optimists stands a more practical and realistic view, which is shared by most of the Chinese wonks. There is a recognition of the positive tone from the meeting and the likelihood that both sides will take some practical measures on the technical level to support the improvement of relations. But that is the farthest it will go. The US and China have officially entered a stage of “struggle but no war,” which is like the US preferred term of “competition but no conflict.”  The majority of the Chinese policy wonks do not believe there is still a chance to reverse the trajectory of US-China relations, so what the two leaders have tried to achieve is not improvement, but prevention of further deterioration.

Behind China’s Pursuit of Détente

Beijing’s conciliatory tone came as a surprise for many. Having witnessed China’s hostile stance and harsh rhetoric against the US in the past few years, including toward the Biden administration, one has to ask why Beijing is seeking reconciliation at this specific time. After all, the motivation will determine the sustainability and long-term trajectory of this effort. Conversations with Chinese interlocutors render a rather realistic assessment—that fundamentally it is China’s domestic problems that have forced Xi to adopt a more practical and conciliatory attitude toward the relationship with the US. In that context, practical considerations also require China to be more strategic about how to approach relations with the US in 2023.

Domestic Problems as Practical Constraints

By the time that the 20th Party Congress concluded, China had been living under self-imposed isolation for almost 3 years. Especially in 2022, China’s economy has suffered tremendously from the rampant and repeated lockdowns to eliminate COVID cases. China’s GDP growth for the first half of the year was at 2.5% according to official data. For the whole year, the World Bank and Asian Development Bank have both forecast growth of around 3.3%. Chinese analysts have also accepted the prediction, setting the expectation under 4%, which will be the slowest in four and half decades. Economy has always been the most prominent component of China’s comprehensive national power and the foundation of its confidence in the “rise of the East and the decline of the West” and “the rise of China and the decline of the US.” Now that China’s economy is facing a significant slowdown, Beijing is forced to refocus its priority back to the domestic and economic front.

Meanwhile, Beijing’s attempt to reimpose lockdowns since the easing of the restriction by the “20 Measures” has exacerbated the situation. The easing of the restriction has led to the emergence of tens of thousands of cases nationwide every day, including thousands of new cases in Beijing. In response, local authorities have resumed stringent procedures, including lockdowns of buildings and communities. Across the country, “COVID fatigue” prevails, and people have begun to protest, not only against the COVID lockdown policies, but also the government in general. Beijing is faced with an unprecedented, pressing threat of social, or even political instability.

Stabilization of external relations to prepare for the hard battle at home is seen as a practical and necessary path to take. The most direct impact of the prioritization of domestic economic and COVID challenges on foreign policy is that Beijing must seek a relatively stable external environment so as to focus on domestic issues. There is a strong aversion to distraction, and to the potential vulnerability that could become exploitable by “foreign hostile forces.” This trend had started right after the 20th Party Congress, with Xi’s diplomatic charm offensive. It is bound to continue until the dust is somewhat settled on the controversial COVID lockdowns.

Practical Considerations

Besides the domestic constraints, there are also practical considerations. The Chinese policy community is attaching great importance to Secretary Blinken’s visit to China next January. Given that the Chinese New Year will be early (January 22), the Chinese speculate that his visit will take place around the second week of January. This will be the first cabinet level visit from the Biden administration to China, and the Chinese are prioritizing how to make the visit successful and pave the ground for positive interaction down the road in 2023.

One of the key considerations for China is the fact that US will be the host of the APEC Summit in 2023. The expectation is that Xi will attend the APEC summit, although the host city is not yet known. Beijing is exploring the possibility of turning the trip into an official visit to the United States as well, which will also require positive interaction between the two countries.  If Xi is able to visit the US, it will be portrayed as the top Chinese leader’s major effort to improve the negative direction of the bilateral relationship.

Looking Ahead

With China’s focus on domestic challenges in the foreseeable future, Beijing will be prioritizing amicable ties with the international community to the extent that it could. We are already seeing active outreach from Beijing to different corners of its foreign policy bases. In the era of decoupling with the US, consolidating ties with Europe, especially Germany, is high on China’s agenda in order to retain the alternative access to advanced technologies that are gradually being cut off from the US. Among communist countries, the leaders of Vietnam, Cuba, and Laos visited Beijing after the 20th Party Congress, which followed the established norm to demonstrate the solidarity among communist countries. North Korea is the only country that has not been able to send its leader to visit China, although Xi and Kim Jong-un have exchanged letters since October and vowed cooperation down the road.

Meanwhile, China is pursuing strengthened ties with its developing country partners. Xi’s visit to Indonesia and Thailand is a good example at hand. If the schedule remains unchanged, Xi is due to visit Saudi Arabia in December to reinforce the positive momentum between Beijing and Riyad, especially given the cooling of ties between Washington and Riyad in recent years. The Chinese foreign minister is expected to visit Africa as the destination of his first overseas trip in the New Year. In the era of strategic competition, Beijing has realized that the target of the competition between US and China is the rest of the world. Therefore, it is even more important for China to secure their engagement, and preferably, support.

However, the scope and depth of the engagement still depends on China’s domestic development. The most consequential instrument in China’s foreign policy toolbox—its economic engagement- essentially depends on China’s adjustment, or elimination of its COVID restrictions, which have limited China’s domestic economic activities and foreign economic engagement. In addition, China’s ability to commit development finance is also severely constrained by its economic capacity.

In this sense, China’s priority in the foreseeable future will be domestic, and Beijing will aim for a relatively stable external environment to ensure its domestic focus. The pursuit of a détente with Washington has illustrated this policy design. Beijing’s diplomatic charm offensive since October might appear striking. But behind it lies a subtle but important reorientation of China for the time being.