China: victim no more ?

The outbreak of the Covid-19 pandemic has not only polarised views as to the role that the US and China have played, it is also creating a deeper awareness and understanding of life in an increasingly globalised world. However, there appears to be signs within China that there is a level of discomfort with China’s response, not just to Australia and Covid-19 criticism, but to other significant trade partners. With China’s import and export volumes contracting coupled with the U-turn on street vendors, suggests that there is an increasing realisation within China that it cannot allow a decoupling from global trade.

There are reports suggesting that this realisation is beginning to permeate the relationship between Xi Jinping and Li Keqiang. In part, the concern is that the positive gains made by China as a responsible global citizen is being undermined by the constant portrayal by their state media that China is the  victim of US bullying, and that this narrative is being increasingly viewed with scepticism by those in the Eurasian region. After all, there is a limit to how many times you can make a believable claim that the “sky is falling”.

Furthermore, claiming bullied status requires an aggressive response to save face within the Chinese cultural context, in a sense boxing China into a very tight corner. This cultural and contextual paradox shows a gap in China’s ambition by highlighting that China needs to adapt to an international rules-based order that accepts cultures and nations as equals if it wants to play a leading role.

So how is China getting this wrong ?

Primarily, it fails to recognise the new world order that it has helped to create. Some would say, it was instrumental in creating this. With the state media building the narrative if you do not listen to China, then you are merely a puppet of the US, fails to recognise that the world has moved on from accepting a single global hegemon. China’s Belt & Road Initiative (BRI) created a new paradigm, in a sense, free market economic development with nuanced “socialist” view of a shared human destiny. Most economies do not see the US as central to their economic development but see each other as integral to their success. It is fair to say, US world leadership has long gone but that does not mean the US has a less important role to play.

State run news agencies portray China as being the bullied victim of a xenophobic, US-led alliance. Furthermore, it has tried to reframe recent history to secure sympathy for their position and present the US and its allies as the great demon. This may well be viewed favourably by their internal audience but shows an immaturity in approach that has played into China sceptics plans by raising cynicism within important trading partners. There is a failure to recognise that the disruption of supply chains and the increasing robust approach to criticism has changed the global narrative from not what China says but to focus on what China does – a focus that is now damaging.

Why China is being increasingly seen as the bully, not the bullied ?

In an international sense, the “final straw” was and is China’s reaction to Australia’s call for an international enquiry into the Covid-19 pandemic. One might say that this is an overreach, but a chronology of events suggest that China had strayed from the stated BRI objective of a shared human destiny and was resorting to US-style bully tactics that Europe and others has already turned their back on. Cold war tactics do not really work in an environment that calls for equality and ethical trade between nations, and the retaliatory measures against Australia has acted as galvanizing event. The reactions in the Chinese press and those factions loyal to China suggests that the global reaction has taken a significant bite out of China’s ambition. After all, why respond to something that you claim cannot hurt you? It is significant that the same media that lambasted Australia as racist are now trying to reframe the historical context by claiming that China always wanted an enquiry. Unfortunately for China, 133 countries did not buy into this spin.

This meltdown in China’s credibility commenced before this incident and Covid-19. There were already signs of a drift. There are numerous examples, but Italy provides a powerful insight as it is the only G7 country to have signed up to the BRI. When Italy installed a new government last year, one of its first foreign relations act was to criticise China’s human rights record. The response by the media in China was to describe the Italians as corrupt and bureaucratic and difficult to work with. This criticism has since been translated into action by China, with increased investment into Greece’s Piraeus Port as well as the recent 60% acquisition by COSCO of Greece’s railway company Pearl SA. It essentially deflects promises made to Italy by building an alternative to what was envisaged in Trieste. Pearl SA, a multi modal logistics provider, connects the strategic Ten-T rail network via the China-Europe Land-Sea express Line. By connecting to the hinterlands of Eastern Europe, North Macedonia, Serbia, Hungary, Austria, Czech Republic, and Slovenia, it bypasses Italy as a gateway into Europe. Furthermore, despite Italy being a participant in the BRI, it has not seen much benefit. In fact, those that were critical of Italy’s BRI stance, had greater economic gains. France, Germany, and the UK have seen increased trade volumes since Italy’s committing to the BRI.

New Zealand’s relationship is now at a crossroads for requesting Taiwan be admitted as a member of the WHO. Whilst the relationship is sound, and the state media talk of sound China / NZ relations and perhaps that New Zealand could be a role model for Australia, it fails to acknowledge that sound relations comes with a caveat. As the Chinese ambassador in New Zealand stated in a recent interview, the spirit of unity and cooperation applies to China and New Zealand, but there has to be commitment and cooperation based on mutual respect, and the principle of the “one-China policy” should be firmly abided by. Questions are rightfully been asked whether New Zealand’s relationship will go the same way as that of Australia should it persevere with its stance on Taiwan. Maybe the Australian, Victorian Premier sums it up best when he says: “you need all the luck in the world if you want to continue developing trade with China whilst trying to raise human rights issues”.

The most important recent development is the formation of an eight-nation alliance that has been forged to act as a buffer to China’s growth into Eurasia. Whilst the Chinese media point to the fact that it is only eight nations and portrays itself as the victim of US-style bullying, what it cannot ignore is the foothold and relationships that they do hold. Nations like Germany, Sweden, Norway, and the EU parliament, have significant sway in key BRI countries. Japan is extending its own version of the BRI through the likes of Indonesia, India, Philippines, and Vietnam. Furthermore, it has aligned focus for nations that previously had significant disagreements, such as Germany and the US. Importantly, this process has not been driven by the US, but by the European alliance observing recent trends in China’s machinations of late.   

The cost to China of pursuing this victim mentality ?

China’s economy is contracting while there is the onset of a global recession. Covid-19 has exposed the soft underbelly of globalised supply chains, particularly the reliance on China. Whilst China and others will rebound, it is the shape of the recovery that will be telling. There will be a realignment of interests, and China stands to potentially lose the gains that is has made. There is a new understanding of what is meant by the dawn the of Asian Century.  Yes, that future is with Asia, and China is a part of Asia. India, Vietnam, Myanmar, Indonesia, and Thailand offer new markets as well.

The best illustration of the cost of the media propaganda machine pushing the innocent China victim / bullied status, particularly labelling many as “vassal states of the US”, can be seen with the demise of Huawei’s 5G ambitions. Much to the dismay of the US, both the UK and Germany signed up to using Huawei’s 5G technology. Whilst the UK has banned Huawei outright, Germany’s Deutsche Telecom is in the process of replacing Huawei with Ericsson. Vodafone is stripping its network of 5G technology over the next five years at a cost of about $400 million, effectively stalling Huawei’s plans going forward. Not only is there a direct financial cost of losing, but there is significant reputational damage as well as reduced access to technology innovation. This is sad when you consider that China and Huawei have led the world in technology development in recent times. This is likely to be undone as access to innovation and ideas dries up. Whilst China has successful innovation labs, their success came from being connected to western based technology companies.   

China going forward

China needs to stop listening to internal hawkish sentiments if it wants to participate in the new global order. The irony is that the new order is based on China’s sharing of human destiny. It is now time for China to step up to the plate and practise what it preaches – redress the issue where current actions do not match the commentary. It should not be listening to those that use the umbrella of victimhood to blame others or make excuses for your mistakes – accept responsibility and accountability for your actions and move forward.

In a sense, stop emulating the US style of mercantilist style bullying. Society has moved on, there is a greater call and need for mutual respect and concern for our fellow citizens. As such there is a need for acceptance and accommodation of necessary differences on the international stage. “Saving face” is a noble approach to relationships within domestic China but may not be appropriate for external relations. An alternative approach needs to be found through engagement. Learn from the recent interactions between New Zealand and Australia. The New Zealand prime minister publicly rebuked her Australian counterpart on Australian soil and at a news conference, this did not lead to a fall out, the parties have moved on.  

Unfortunately, on the global stage and as the second largest economy, you cannot keep playing victim nor tie yourself to developing status. Just as was the case for Charles Dicken’s Uriah Heep, this negative narrative has created scepticism and is undermining your international gains. Celebrate the great progress you have made as well as the important contributions you make. But understand that playing politics is a tough business, it is no longer a place for bullies.

As a first step forward, the challenge for China is to show belief in a shared human destiny, true leadership and pick up the phone and answer the calls made from Australia.   

Picture credits: Associated Press