international analysis and commentary

China’s paradox of power: consolidated at home, contested overseas

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The sheer breadth and speed of China’s rise has been the most consequential geopolitical event of our era. Within a single generation, the Asian powerhouse has transformed from an impoverished nation into the world’s leading manufacturing hub and trading nation. No longer relying on cheap labor and substandard production, China has also become a growing source of infrastructure investments, digital innovation and high-quality scientific production.

Yet, the Asian nation’s increasing integration into the global economy, or rather the world’s increasing reliance on its productive capacities, has not produced a more liberal and cosmopolitan China. If anything, the Xi Jinping regime has ushered in the very opposite outcome in recent years. China is where Francis Fukuyama’s famed “End of History” thesis seems most hollow.

At the heart of China’s strategic predicament is a distinct paradox: As the Asian country becomes ever more powerful, reclaiming its place of pride on the global stage, its authoritarian leadership has become ever more strategically paranoid and politically repressive. The upshot is China’s emergence as a humungous yet fragile superpower with few precedents in human history.

A celebration for the 100th anniversary of the Communist Party of China at the National Stadium in Beijing, in 2021

 

Crackdown and consolidation

At the height of pro-democracy protests in Hong Kong in mid-2019, I visited the city-state to observe the perilously tense and ever-escalating situation on the ground. During a large-scale protest in Sha Tin district, a wrathful university student, seeking anonymity behind a face mask, told me, “We are not fighting to gain anything, [but instead] we are fighting to not lose anything. I am worried about Hong Kong becoming [like Communist] China.” With anti-riot police closing in on our area, the student protester added, “Never trust China.” Just few minutes earlier, two other students, lying on concrete and hiding behind face shields, which would become globally ubiquitous a year later amid the COVID-19 pandemic, echoed similar sentiments, by declaring, “We don’t want to be [like Communist] China.”

Throughout my interviews with Hong Kong protesters, who came from all walks of life, the overarching sentiment was broadly similar, with almost all of them making it clear that trade and investment considerations should not distract the world from the more nefarious aspects of expanding strategic relations with China. But despite the so-called “One China, Two Systems” doctrine, their city-state didn’t even have the luxury of determining the terms and texture of its relations with the Asian superpower. Desperately clinging onto fragile privileges and freedoms inherited from the British colonial era, Hong Kong never truly represented an autonomous polity, but has instead served at the mercy of Beijing’s strategic and political considerations in the 21st century.

Since the outbreak of massive pro-democracy protests in 2014, with the so-called “Umbrella Movement” resisting Beijing’s intrusion into Hong Kong’s basic education, the Chinese Communist Party (CCP) tried to avoid a Tiananmen-style showdown. Instead, the communist leadership relied on Hong Kong-based proxies and weaponized legislations, not to mention infrastructure connectivity (i.e., Hong Kong-Zhuhai-Macao Bridge), to contain the democratic aspirations of the city-state. The year 2019, however, proved particularly sensitive, since it marked the 70th anniversary of the CCP’s ascent to power.[1] The upshot was a dangerous deadlock, with both sides digging in – although Beijing’s proxies in Hong Kong tried to diffuse tensions through tactical recalibration, namely the withdrawal of the controversial extradition bill, which had sparked the latest round of anti-China protests in the city-state.

 

Read also: At 70, China’s greatest fear is fragmentation

 

The COVID-19 pandemic, which ushered in draconian policies in China and the world over, completely altered the political landscape. The CCP swiftly securitized the pandemic to stifle the pro-democracy protests in Hong Kong and impose a new status quo altogether. Following zero consultation with people of Hong Kong, China’s rubberstamp legislature, the National People’s Congress (NPC), perfunctorily passed a new and amorphously defined national security law, which instantly produced a chilling effect in the besieged city-state. Earlier, the NPC had defined terrorists as “whoever propagates terrorism or extremism by way of preparing or distributing books, audio and video materials or other items that propagate terrorism or extremism or by way of teaching or releasing information.”[2] The new national security law also had a similarly vague definition of “subversion”, which it defined as any act against China’s “state power”. Thus, the new weaponized law could potentially categorize even peaceful democratic dissent in Hong Kong as a form of “subversion” if not “terrorism”.

It didn’t take long before Hong Kong’s most prominent pro-democracy groups, including Demosisto and the Hong Kong National Front, decided to preemptively disband themselves in order to avoid heavy criminal charges.[3] Soon, local publishers and independent-minded literati also followed suit, fearing extradition to China on trumped up charges.[4] Governments in nearby Taiwan, which has resisted incorporation into China, and in the United Kingdom, a former colonial authority, even provided an expedited path to citizenship to the new wave of emigres.[5] The crackdown in Hong Kong, however, didn’t create the kind of economic crisis that many observers predicted. If anything, Chinese authorities quickly mobilized the business elite to preserve Hong Kong’s status as the financial hub of Asia.

Despite the initial dip in the stock market,[6] the CCP, along with its Hong Kong proxies, engineered a smooth economic transition, channeling up to $600 billion[7] in investments into the city-state, as mega-investors from mainland China supplanted Western counterparts and began setting up shop across the city-state’s prized skyscrapers.[8] In the run-up to the passage of the new national security law, Alibaba, founded by tycoon Jack Ma, raised  $11.2 billion[9] in Hong Kong’s stock market. Chinese e-commerce retailer JD.com and online game company NetEase also followed suit. Meanwhile, state-backed insurance giant Ping An allocated $5.4 billion for a real estate project in the West Kowloon district. With Western governments tightening restrictions on Chinese companies, Beijing’s emerging “come back home” initiative found fertile grounds in Hong Kong.[10] While extending carrots to mainland-based companies, the CCP deployed the hammer to warn Cathay Pacific,[11] as well as global accounting firms[12] such as HSBC, to toe its line lest lose access to China’s massive markets.

 

The new emperor

The tragic denouement to Hong Kong’s democratic protests, however, pales in comparison to Beijing’s iron-fist approach to unrest in Muslim-majority Xinjiang. Western governments, as well as the United Nations, have raised alarm over mass atrocities against the Uighur population, which, according to some observers, is facing nothing less than an ethnic cleansing campaign. The “Xinjiang Papers”, four hundred pages of leaked internal documents, have exposed the sheer brutality of Beijing’s treatment of Muslim minority groups; large numbers of Uighur adults have been reportedly sent to concentration camps, where they have faced coercive indoctrination and other forms of repression.

In response, China has tried to downplay criticisms by portraying its controversial policies against domestic minorities as both defensive, a response to real and imagined terrorism threats, as well as empowering, supposedly nipping religious extremism in the bud and ensuring social harmony in frontier provinces such as Xinjiang. The majority “Han” population, meanwhile, has had to contend with a systematic rollback in political and economic liberalization, which characterized much of the Jiang Zemin and Hu Jintao administrations throughout the 1990s and early 2000s. Even elite universities have had to sacrifice any shred of academic freedom in response to the shifting sands in the broader ideological landscape. China’s insistent on a “Zero COVID” policy two years into the pandemic, which forced mega-cities such as Beijing and Shanghai into extensive and disruptive lockdowns, has exposed the depth of authoritarian lurch in the country.

The new political environment in China is a reflection of a historic shift in the country’s domestic political system, namely the emergence of a new and confident strongman. Since rising to power almost a decade ago, Xi Jinping has rapidly consolidated control over all key organs of the Chinese state. Rapidly dispensing with the collective-consociational regime established by former paramount leader Deng Xiaoping,[13] which was expressly designed to avoid personalistic politics, Xi has emerged as the most powerful man in China’s modern history since Mao Zedong. Three factors, in particular, define his style of leadership.

To begin with, Xi, a relatively obscure princeling married to a celebrity wife (Peng Liyuan), has been an age-old advocate of decisive and single-minded leadership. During his stints as party chief in Fujian and Zhejiang provinces, he penned a number of works, namely Work on Real Things and Walk at the Forefront (December 2006) and New Thoughts from the Yangtze (August 2007), which reflected his preference for the reinstitution of a paramount leader, a “number one”, who serves as the “the personification of the Party Committee and the government” and congeals an seemingly fractious and indecisive ruling elite into “into a [unified] song.”[14]

And this brings us to the second element of his rule, namely a 21st century blending of communist populism and nationalist authoritarianism. From populist stunts,[15] visiting the folksy Qingfeng restaurant, to a high-profile anti-corruption crackdown, which targeted senior leaders such as Bo Xilai and Sun Zhengcai, and the re-introduction of Maoist trials[16] and “self-criticism” sessions,[17] Xi has projected a hands-on, no-nonsense and people-oriented leadership amid an era of rapid growth, social dislocation and ideological despondency.[18]

The sustained purge of rivals has coincided with Xi’s transformation into the “chairman of everything”, with the Chinse leader presiding over a dozen newly-established bodies such as Leading Small Groups on foreign and security affairs, Central Leading Group for Comprehensively Deepening Reforms, and State Security Committee (national security council of China).[19] This paved the way for Xi’s seamless elimination of the presidential term limit, raising the prospect of a lifetime rule for China’s latest paramount leader.[20]

 

Strategic blowback

It’s the third element of Xi’s rule, however, that has proven particularly consequential for the outside world. At the heart of his ideology is the pursuit of  the “Chinese Dream”,[21] namely an era of prosperity and peace for his people, and “great rejuvenation,”[22] namely the elevation of China into a global power, as the CCP nears  its centennial in power[23] by the middle of this century (2049). To this end, Xi has proactively cracked down on any whiff of “color revolution” at home,[24] namely bottom-up challenges to the ruling party, while overseeing heightened geopolitical assertiveness abroad, with China taking an increasingly uncompromising and aggressive stance on Taiwan, the South China Sea and the East China Sea disputes, and even on border disputes with India in the Himalayas.

 

Read also: The Taiwan crisis: Sleepwalking towards a global conflict

 

During the centennial celebration of the founding of the CCP, Xi, donning a Mao suit, warned rivals of a “Great Wall of steel” should anyone dare to “bully, oppress or enslave us”. Months earlier, he warned of a more hostile international environment and the need for the country’s armed forces to prepare for all-out war “at any second”.[25] With China now boasting the world’s second largest economy (in nominal exchange rates) and second largest defense budget, which now rivals America’s, Xi’s words carry significant geopolitical weight.

To enhance China’s influence, Xi has overseen the establishment of various global initiatives, including the Shanghai-based New Development Bank (NDB), the Beijing-based Asian Infrastructure Investment Bank (AIIB), and the Belt and Road Initiative (BRI), which collectively allocated close to a trillion dollars for overseas development projects in the past decade.[26] Far from a purely benign strategy, however, China’s economic initiatives serve a more “realist” strategic objective too.

As Yan Xuetong, one of China’s leading strategists, once put it, “allow[ing] these smaller [neighboring] countries to benefit economically from their relationships with China…We let them benefit economically, and in return we get good political relationships.” In the words of the Chinese political scientist, “We should ‘purchase’ the relationships.” Nevertheless, the Asian country’s rapid ascent, and the CCP’s aggressive posture overseas and authoritarian lurch at home, has triggered a geopolitical blowback on two fronts simultaneously.

To begin with, Beijing’s BRI projects have come under fire for overreliance on Chinese labor and technology, lack of transparency, and, in some cases, fiscal and environmental unsustainability. From Gwadar in southern Pakistan to Hambantota in Sri Lanka and Sihanoukville in Cambodia, Chinese investments have largely excluded local communities and instead benefited shady businesses and corrupt government officials.

According to research group, AidData, China’s BRI projects have piled up undisclosed liabilities, so-called “hidden debts”, of up to $385 billion. Between 2020 to 2021, New York-based Rhodium Group reported that Beijing had to renegotiate projects worth up to $52 billion in order to avoid severe debt distress among some recipient nations. In light of the fiscal distress in places as varied as Sri Lanka, Laos and Malaysia, some commentators have accused China of deliberately engaging in a “debt trap” diplomacy, supposedly forcing besieged nations into unfavorable debt-for-equity arrangements, which expand China’s strategic footprint in vital locations across the Indo-Pacific.

Growing skepticism towards China’s economic influence has gone hand in hand with a brewing new Cold War with the West, especially since the former Trump administration’s imposition of unilateral trade sanctions against the Asian powerhouse. By and large, US President Joseph Biden has embraced his predecessor’s tough policy vis-à-vis Beijing, which enjoys broad bipartisan support in Washington.

Over the past five years, the US has overseen the institutionalization of the Quadrilateral Security Dialogue (Quad) power grouping along with India, Japan and Australia, the revitalization of the Australia-UK-US (AUKUS) defense alliance, and expanded bilateral military cooperation with likeminded powers across the Indo-Pacific, including Singapore, South Korea, Indonesia and even Taiwan. The overarching goal is to establish “integrated deterrence” against China’s expansionist instincts through a broad network of interlocking and deepening security partnerships.

 

Read also: US-China: The cool war

 

Beyond enhancing military interoperability with strategic partners and allies in the region, the US and its key allies have also spearheaded various initiatives – including the Indo-Pacific Economic Framework,  the Blue Dot Network (BDN), the Build Back Better World (B3W), the US-Japan joint high-tech infrastructure initiative, and EU-Japan Partnership on Sustainable Connectivity and Quality Infrastructure – to counter China’s economic influence in the developing world.

Xi Jinping may have gotten his way at home, at least for now, by purging rivals and stifling any opposition to his rule. Overseas, however, he has helped unleash a new and perilous era of geopolitical competition with the West, which is threatening decades of relative prosperity and peace in the Indo-Pacific.

 

 


Footnotes:

[1] Roberts & Garton (2009).

[2] Li (2019).

[3] The Japan Times (2020).

[4] Stevenson & Wang (2020).

[5] Colchester (2020).

[6] Stevenson (2020).

[7] Stevenson (2020b).

[8] Stevenson (2020b).

[9] Stevenson (2019).

[10] Stevenson (2018).

[11] Cheung & May (2019).

[12] Zhong, et.al (2019).

[13] Bogaards, Helms and Lijphart (2019).

[14] Martin & Cohen (2014).

[15] Schiavenza (2013).

[16] BBC News (2019).

[17] Economy (2019).

[18] Shirk (2018).

[19] Glosserman & Roy (2014).

[20] Shirk (2018)

[21] BBC (2013).

[22] Economy (2018).

[23] CGTN (2020).

[24] Reuters (2019).

[25] See Laura, Silver, Kat Devlin & Christin Huang (2020)

[26] See Cai, Peter. “Understanding China’s Belt and Road Initiative.” Lowly Institute. March 22, 2017. https://www.lowyinstitute.org/publications/ understanding-belt-and-road-initiative; Heydarian, Richard Javad. 2019. “The Indo-Pacific: Trump, China and the New Struggle for Indo-Pacific”, Palgrave Macmillan: Singapore, pp. 93-118; Reuters Staff, 2020. “China says one-fifth of Belt and Road projects ‘seriously affected’ by pandemic”, Reuters  https://www.reuters.com/article/us-health-coronavirus-china-silkroad-idUSKBN23Q0I1