The start of the Beijing Winter Olympics strengthens China’s position in the international news. In the present analysis we will examine what is the role of China in the modern world, what are the relations with the USA and the EU. and in the strategic competition that is developing? I will present some general conclusions, which the analysis team of our magazine has reached
- 2021 marks the 20th anniversary of China’s accession to the World Trade Organization (WTO).
- 2021 marks the 100 years since the founding of the Communist Party of China, which – judging by the result – must be the most resilient and powerful political organization on the planet.
- 2022, the start of the Beijing Winter Olympics strengthens China’s position in the international news.
- 2022, the Congress of the Communist Party of China is scheduled for current year, which takes place every five years, which is expected to ratify significant changes and set very ambitious goals.
China’s economic system is succeeding
China’s economic system is considered to be remarkably successful. In 2000, China’s per capita GDP was under a thousand dollars, 36 times less than the US per capita GDP. Twenty years later, China’s per capita GDP was (Le bilan du Monde) $ 10,500, one sixth of the US.
China’s growth rate is extremely dynamic. Hundreds of millions have emerged from the trap of poverty. A huge middle class of western consumer standards was created. The country has in recent years and the record of creating new billionaires, something that is strange, if we consider that economic growth takes place under the political guidance of the CCP.
China’s political system is widely accepted
Of course, China’s political system does not have the liberal-democratic function of the Western system. One is the party and it does not dispute its sovereignty, as the strict treatment of the democratic dispute in Hong Kong has shown.
The regime, however, enjoys widespread popular acceptance. The Chinese are particularly sensitive to issues of stability, national dignity and even greatness, due to their historical course over the centuries. Therefore, the regime covers them in general, despite the fact that it pursued the policy of openings with an iron fist, as the massacre in Tiananmen Square showed.
The evolution and development of the Communist regime
Most western countries believed that China’s dramatic economic growth would also lead to the gradual liberalization of the regime.
In the US and the EU conclude that China has been moving in the opposite direction in recent years. That is why they are raising the tone of what happened in Hong Kong, while they believe that Beijing is oppressing Muslim Uighurs on the borders of Stalinist-style concentration camps, and even genocide. Western governments have decided to boycott the Beijing Winter Olympics diplomatically, which in our opinion does not send the right political message, nor does it have to do with the Olympic Spirit.
Party and constitutional changes have already taken place that will allow Chinese leader Xi Jinping to get rid of the two-year five-year leadership limit and remain in power for as long as the inter-party balance of power favors him.
The crucial question is whether Xi Jinping will use his upgrade to the level of Mao Zedong and Deng Xiaoping to make the necessary structural changes, or whether he will choose the path of total political control and dynamic to aggressive foreign policy. In the US and the EU, the prevailing view is that it will move according to the second scenario.
Criticism from the West without influence
The criticism, however, made by the US and EU governments. and more generally what we call the West, in the Chinese leadership, does not significantly affect the Chinese perception of their country.
Because China has gone through a century of colonial humiliation and even crime, with the British and Japanese being primarily responsible, Western criticism has had little effect on it.
Moreover, it is obvious that the regime and the country have left the very difficult ones behind. The goal is no longer to feed the population or to organize the development of basic infrastructure, but to get the Chinese economy to overtake the American economy in the second half of the decade and then China to become the first of the two superpowers in terms of radiation and its influence on the world.
Successful pandemic management
The pandemic started in China and for a few weeks the idea prevailed internationally that it could turn into a Chinese humanitarian tragedy that would delegitimize the regime.
With a mixture of communist discipline, impressively effective organization and exploitation of the spectacular progress of the Chinese pharmaceutical industry and digital economy, the Chinese were able to control cases and deaths.
In a country of 1.4 billion people, deaths were reduced to less than 5,000, while in the US 330 million and in the EU. of 440 million we are marching at full speed towards the 2,000,000 deaths, 1 million in the USA and 1 million in the EU. of “27”. This is a striking difference in dealing with the pandemic, which strengthens the regime’s public and international image.
The issue is whether the Chinese can withstand the continuation of the policy of zero tolerance towards COVID-19.
The issue has not an easy answer, because the challenge facing the authorities is becoming more and more complex. The “Omicron” variant is highly contagious and recently dozens or even hundreds of new cases are recorded on a daily basis, which are treated with drastic measures, such as absolute lockdown in large parts of urban centers or mandatory molecular tests for all city dwellers 5, 10 and 15 million in just 24 hours.
The situation becomes more complex due to the Winter Olympics, which require controlled border opening for Olympic missions and agents, and due to the Chinese New Year. This year, unlike the previous two, the movements of the festive season are allowed, ie hundreds of millions of Chinese.
So we will have to wait and see if the Chinese method leads to the effective treatment of the pandemic or if the coronavirus will find a way to bypass it. At present, however, China is experiencing significant success in the health sector while its economy did not experience a recession in 2020, like the other major economies. Simply put, the rate of economic growth declined in 2020 to return to the known rates, 6% -7% in 2021, possibly in 2022.
The policy of one China
China is pursuing the policy of one China, that is, it believes that there can be no other Chinese state like Taiwan, which was accepted by the United States when it decided to open up to China impressively.
This policy is not disputed by the US and the EU, which, however, exhaust the possibilities of economic and political cooperation with Taiwan, without officially recognizing it as an independent state.
Upgrading Taiwan to US and EU Strategy should be attributed only partially to the strategic competition with China. Taiwan, with a population of 23 million, has been transformed in recent decades into a mature democracy with a change of parties in power and full recognition of political rights and freedoms. At the same time, Taiwan became a world champion in the strategically important microchips industry. Taiwan’s special weight in the world economy has been strengthened (please read the analysis entitled “How the Troubled US Economy Affects the International Relations of Superpower“), while there is a qualitative dimension to the transition to the digital economy.
Despite China’s differences and warnings that reunification with China will be imposed in one way or another, the two sides have found a way to dramatically develop their cooperation. Taiwanese companies’s direct investment in China is estimated at more than $200 billion. According to official figures from Taiwan, bilateral trade with China exceeded $210 billion in 2020 and Taiwan’s surplus was $80 billion. A large trade surplus with China is a really impressive thing that highlights Taiwan’s economic dynamism.
The United States is stepping up its guarantees of maintaining Taiwan’s independence, while Japan is a strong supporter of the country, economically and politically.
The strategic opponent of the USA
In the US perception, China is now the main strategic rival. Both Donald Trump and Joe Biden see US strategic interests as threatened by China’s dynamic to aggressive foreign policy and its dramatic rise in the economy, digital economy and advanced technology sectors.
The difference is that Donald Trump wanted to face the Chinese challenge alone in the context of the “America First” doctrine, while Biden seeks to strengthen multilateral cooperation between Western countries and countries that are friendly to the West or have differences with China. The similarity lies in the fact that judging by the persistently high US trade deficit in trade with China, the US economy is still lagging behind in terms of production and international competitiveness.
China’s international influence
China has strengthened its international influence by leveraging its economic power and the positive disposition of third countries, which prefer to work with it – especially in Africa – in an effort to limit the influence of the former colonial powers.
China’s economic expansion is based on hundreds of billions in investments in basic infrastructure development. China is reviving the “silk roads” through the so-called Belt and Road Initiative. It is pursuing a flexible strategy and now seems to be prioritizing oil-producing countries such as Iraq, the Arab world and African countries, especially those producing strategically important minerals – rare earths.
EU and China
The EU generally follows the American strategy in terms of rivalry with China, but makes sure to differentiate. It seeks a rivalry of lower intensity and with an enhanced element of creative economic competition.
Germany and France are calling on the United States, among other things, for a more compromising stance on Russia, which will allow for a meaningful dialogue. Germany differs in the issue of Russia and China, especially for energy and economic reasons. France, with a more political reasoning that emphasizes the strengthening of European autonomy, considers that the EU has an interest in developing cooperation with Russia, under certain conditions, rather than risking sending it into the arms of China.
EU countries have a symbolic naval presence in the Indian and Pacific Oceans, where competition with China for maritime control and military training is growing. But the weight of this kind of confrontation is being lifted by the United States, Australia and the United Kingdom, as evidenced by the impressive emptiness of France, which lost to American and British interests the large order for the Australian navy submarines.
Japan, New Zealand and Taiwan, and more closely South Korea, are also taking part in the military rivalry with China. The role of the dynamically rising India is also of strategic importance, which traditionally pursues a non-aligned policy, but has border differences in the wider competition with China, which makes it seek political reconciliation and military cooperation with Western powers.
China is also a superpower in the digital economy
China is also a superpower in the digital economy. For example, it is far ahead of 5G technology, while the Chinese telecommunications and digital giants are competing globally with the US, with the EU. essentially in the role of observer of the confrontation for global digital domination. The difference is that the communist regime reacts strongly to the accumulation of wealth and power that characterizes digital giants in China, as in the United States.
The communist leadership intervened to thwart plans to expand the digital industry to electronic payments with a view to issuing digital currency. Beijing does not accept the emergence – through the economy – of a competitive power pole, in the broadest sense of the word.
And American digital giants are provoking strong reactions in the US and the EU, only that governments have not yet found a way to react to the domination of lobbies.
China and climate change
China also plays a leading role – positively or negatively – in the issue of climate change. It is the biggest polluter on the planet, if the country’s performance is measured. But in terms of per capita contribution to the environment, it lags far behind the more developed western countries that have increased consumption too much.
China is involved in trying to prevent climate change, but on its own terms. While Western countries are committed to a climate-neutral economy by 2050, China has simply pledged to reach its maximum environmental impact by 2030 and then pursue climate neutrality by 2060.
It has demonstrated impressive achievements in the development of Renewable Energy Sources (RES), in the electrification of vehicles – where it is considered a world champion – and in the production of batteries, where it controls 75% -80% of the world market.
It also has an impressive comparative advantage in the production and mainly the industrial processing of strategically important minerals, necessary for the green and digital transition, through the investments and acquisitions it has made in third countries.