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Event:
A Chinese jet carried out a highly aggressive maneuver near a U.S. military plane over international waters in the South China Sea yesterday (Reuters report; CNN report; Al-Jazeera report)
Insight:
Following Xi Jinping’s era-defining dictum to “Dare to Fight” (敢于斗争) on March 9th of this year, the Peoples Liberation Army has been recently putting those words into practice, as seen with yesterday’s highly-aggressive fly-by. Also yesterday, China’s Defense Minister Li Shangfu bluntly and publicly rejected U.S. Defense Secretary Lloyd Austin’s proposal to meet while both attend the Shangri La Dialogue meeting in Singapore this weekend to discuss improving military-to-military lines of communication for the purpose of keeping miscalculations from spiraling into crises. The takeaway: Xi Jinping is choosing to jettison the hard lessons learned from the 2001 Hainan Island incident in order to strike a Dare to Fight posture for both domestic and international audiences in 2023.
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Context:
The Hainan Island incident, which occurred on April 1, 2001, was a potential military flashpoint event involving a collision between a United States Navy EP-3E ARIES II signals intelligence aircraft and a Chinese J-8II interceptor jet.
During the incident, the EP-3E ARIES II aircraft was conducting a routine surveillance mission in international airspace near Hainan Island when it collided with the Chinese interceptor jet. The Chinese J-8II jet pilot, Wang Wei, tragically lost his life, while the EP-3E plane made an emergency landing on Hainan Island. The 24 crew members were detained and interrogated by Chinese authorities over an 11 day period until the crisis was defused by diplomats with an artfully worded statement crafted to allow both sides to save face.
Following the incident, both the United States and China conducted investigations and diplomatic negotiations to address the aftermath. Some of the general lessons learned from the Hainan Island incident include:
• Importance of Communication and Crisis Management: The incident highlighted the necessity for effective communication and crisis management between military forces of different nations. Improved communication channels and crisis response mechanisms can help prevent misunderstandings, manage tensions, and avoid accidents.
• Need for Clear Rules of Engagement: Clarity in rules of engagement is crucial to avoid misunderstandings and prevent accidental collisions. Developing and maintaining clear guidelines for military aircraft operations in close proximity can help reduce the risk of accidents and promote safety.
• Enhanced Airspace Management and International Cooperation: The incident underscored the importance of effective airspace management and international cooperation to ensure the safe and peaceful use of airspace. Better coordination mechanisms, sharing of flight information, and adherence to established international norms and protocols can help prevent incidents in shared airspace.
• Diplomatic Engagement and Conflict Resolution: The Hainan Island incident emphasized the importance of diplomatic engagement and conflict resolution to de-escalate tensions and find mutually agreeable solutions. Diplomatic efforts can help facilitate the resolution of disputes and prevent further escalation of conflicts.
• Airborne Collision Avoidance Systems (ACAS): The incident also highlighted the need for improved collision avoidance systems and technologies to enhance situational awareness and prevent mid-air collisions. The development and implementation of advanced ACAS can help aircraft detect and avoid potential collisions, thereby increasing overall flight safety.
Technical analysis of the collision by U.S. experts concluded that the collision was caused by unintended contact between the two aircraft as a direct result of Chinese pilot Wang Wei’s overly aggressive fly-by. While Chinese authorities claimed that the U.S. EP3E aircraft had dipped its wing to initiate the contact, computer modeling showed conclusively that the relatively slow-moving EP3E could not have maneuvered in such a way as to affect the fast-moving Chinese interceptor jet.
Perspective:
I was stationed as the chief of the U.S. Commercial Section in the American Institute in Taiwan (the de facto “U.S. Embassy”) at the time of this incident. My A.I.T. colleagues were directly involved in the reporting and post-incident analysis of this tense encounter.
China’s Ukraine crisis mediator Li Hui wrapped up his two-day visit to Kyiv yesterday. He is now headed to Poland, France, Germany and Russia. What should we expect? With Poland, he will likely make the case that Poland’s serving as the primary conduit for NATO arms into Ukraine hurts prospects for peace and that Poland should emulate China’s “restraint” in not supplying arms to either side. In France, Li will repeat the Macron’s refrain — music to the Chinese Communist Party’s ears — that France aligns with China in seeking a cessation of violence in Ukraine and doesn’t think that Taiwan figures prominently in Europe’s “strategic autonomy” calculations (a tune which was widely repudiated throughout the EU shortly after Macron riffed on it in Beijing last month). In Germany, the message will be stern Chinese disapproval and “hurt feelings” over the US $2.97 billion (€2.7 billion) military aid package just announced by Germany’s Ministry of Defense late last week. The final stop in Russia will be to debrief Foreign Minister Lavrov (and possibly Putin himself?) over what Li learned from this diplomatic circuit.
When Beijing announced its twelve-point PRC Position on the Settlement of the Ukraine Crisis last February, coinciding with the one-year anniversary of Russia’s invasion of Ukraine, I was immediately skeptical. In 1% Words, 99% Work and in a subsequent Q&A post, I laid out the reasons for my skepticism. I have been often asked since then if I remain equally dismissive and, if so, why. On the first point: Yes, with a single qualification (see below), I remain dismissive. As to why, the question is where to begin?
While China is presenting itself on the global stage as a potential mediator, it is definitional that a mediator needs credibility on both sides to play a meaningful role. Notwithstanding Zelensky’s eagerness to talk with Xi and SecState Blinken’s recent suggestion that China could have some useful role to play in an eventual cessation of hostilities, China has zero credibility as a mediator:
- Its twelve-point plan is entirely contradictory with respect to Ukraine’s sovereignty and, by freezing in place territorial gains by Russia over the past year, would reward Russia for its invasion
- China has consistently propped up Russia over the past fifteen months by every means available short of supplying lethal military armaments (and, with its export of dual-use drones, has leaned over that line)
- Xi’s appointed “mediator” to help resolve the conflict, Li Hui, previously served for six years as China’s ambassador to Russia
- I could go on at length but, since a picture can be worth 1,000 words, let me simply share one graphic depicting China’s G7 voting record on Ukraine-related measures over the past year and a quarter. It speaks for itself:
So what about the caveat I mentioned above? Since it’s clear that China can’t be a good faith mediator, Xi has a different gambit disguised under his pose as a potential mediator. He is positioning China in Putin’s corner so that, at some future point, he can come to the center of the ring as counterpart and interlocutor with the U.S. and most of Europe coming out from Ukraine’s corner. In Xi’s worldview, China and the U.S. should bargain — as equal powers — over the heads of Zelensky and the Ukrainian people. For Xi, this positioning serves China either way — if it happens, it confirms China’s role on the world stage as a counterweight and as an equal to the U.S. If it doesn’t happen, the U.S. remains mired in its Ukraine engagement, freeing up China to advance its interests in the Mid-East and elsewhere with reduced U.S. pushback.
What eludes Xi’s vision and grasp is the ultimate strength and source of legitimacy of democratic authority. What he is failing to understand is that the U.S. and the community of European nations will not barter away Zelensky’s and the Ukrainian people’s sovereignty and territorial integrity. The end result will be no meaningful mediation and no cessation of hostilities short of a decisive military resolution on the ground. Seen in this light, China’s role is hardly that of a mediator. Xi will advance China’s interest in keeping the U.S. tied up in Europe by confusing the global picture, continuing to prop up Russia by all available means and prolonging the conflict with little concern for the welfare of the Ukrainian people.
My March 30th post (Taiwan’s Historic Split Screen) was written as President Tsai Ing-wen arrived in New York in transit on her diplomatic visit to Central America. That piece promised a follow-up on the occasion of her return transit to Los Angeles — and meeting with Speaker of the House Kevin McCarthy — en route back to Taiwan. The Tsai-McCarthy meeting took place 6 days ago on April 5th but I delayed following up until today because my interview with Forbes on this topic was in the works.
That Forbes interview was published yesterday and can be found here (including 12 minute audio version). I am also reproducing that interview below to capture it in the Assessing China blog. It begins with several scene-setting paragraphs by Forbes Editor at Large Russell Flannery. The interview itself begins below the photograph of Micron headquarters in Shanghai.
(Begin article)
Micron Probe May Hurt China’s Efforts To Attract Foreign Investment
Beijing today wound down its latest large-scale military exercises in the waters around Taiwan but overall tension between the U.S. and China remains high. China’s moves followed a high-profile meeting last week between U.S. House Speaker Kevin McCarthy and Taiwan President Tsai Ing-wen in Los Angeles criticized by mainland leaders who claim sovereignty over self-governing Taiwan.
On the commercial front, the semiconductor industry remains an elevated point of stress. Beijing earlier this month announced a cybersecurity review of U.S. chipmaker Micron aimed, it said, at protecting the country’s information infrastructure and national security. The probe comes at a time when China has been seeking to boost foreign investment to accelerate its economic recovery from “zero-Covid” policies that slowed growth.
What’s next for U.S.-China ties and also for the CHIPS Act, the U.S. law enacted last year aimed at reversing the declining American share of global semiconductor production?
To learn more, I spoke on Saturday in the Philadelphia area with Terry Cooke, a senior fellow at the Foreign Policy Research Institute, a think tank focused on U.S. national security and foreign policy. Cooke, a former career U.S. senior foreign commercial service officer with postings in Shanghai, Taipei, Tokyo and Berlin, currently leads ReGen250, a non-profit that focuses on U.S.-China green energy collaboration as well as environmental regeneration initiatives in the tri-state Greater Philadelphia region.
Cooke believes China’s move against Micron will have “a chilling effect for potential foreign investors — definitely on the U.S. business community” at a time when China is trying to win new foreign investments following the end of “zero-Covid” policies at the end of last year that had harmed economic growth. Beijing high-profile efforts to pressure Taiwan militarily may also be counterproductive if Taipei successful builds itself up as “an important force” in a larger, more influential network of democracies. Edited excerpts follow.
© 2023 BLOOMBERG FINANCE LP
Flannery: What do you make of the military exercises around Taiwan this month?
Cooke: There are two ways of looking it. One is that going into the Tsai-McCarthy meeting, the decision had already been made (in Beijing) that this is the new normal, that whenever there is an uncomfortably high-level contact between the U.S. government and the Taiwanese government, we (the Chinese government) are just going to keep demonstrating our ability to militarily squeeze Taiwan through maneuvers of this sort.
There is, however, another way of thinking about it: the way the McCarthy-Tsai meeting was conducted may, in fact, have been the determinant of the maneuvers. Beijing may have been in a wait-and-see mode. They of course issued their standard and predictable verbal denunciations in advance of Tsai’s transit stops.
I think they were waiting to see how low-key the meeting in L.A. with McCarthy would prove to be. The entry through New York was very low-key. The State Department utterances for most of the trip also kept things low-key. And there was ample precedent for this given Tsai’s previous six transit visits to the U.S. so the State Department position was that there was no reason for Beijing to make an issue out of it.
But the optics of McCarthy meeting – with all the diplomatic trappings of a government-to-government meeting save for flags set up on the table – made it look very much like an official meeting. And I don’t think that went over well in Beijing. That could have triggered the decision to trot out the military.
Flannery: So what’s next?
Cooke: Just as the U.S. is maybe on its back foot with the new realities in the Middle East, I think China may be on its back foot in terms of the game of diplomatic recognition when it comes to Taiwan. Yes, Taiwan just lost Honduras on the eve of Tsai’s U.S. trip. Now, Taiwan is down from 14 to 13 countries that it has diplomatic recognition with.
But I think there’s really a more important game in town now than adding up the number of formal diplomatic allies. This new game in town probably started around February 2021 with the Biden administration moving into the White House. To many people’s and particularly Beijing’s surprise, Biden kept Trump’s tough China policy. He also introduced into his speeches and policies a clear and consistent autocracy-vs-democracy contrast.
Within the context of this U.S.-led “reframing” of the global picture, Taiwan now has the opportunity to reposition itself within the team democracy global network of supporters in a way that it’s not strictly about formal recognition and UN membership. It’s about being recognized, and in some ways, held up as an important force in this network of democracies.
Flannery: How will Taiwan’s presidential elections next year affect these three-way ties?
Cooke: From the U.S. governmental standpoint, the outcome – whether it is a victory for Tsai’s Democratic Progressive Party or the opposition KMT party – will change hardly at all. This is because the U.S. government’s official position – whether it involves the outcome of an election in Taiwan or changes to the cross-strait status quo initiated by China – is that what the 24 million people of Taiwan choose for themselves is what the U.S. government will support. I don’t think our basic diplomatic posture and our support for Taiwan would change unless there was some evidence — which I would not expect at all — of some malfeasance happening with the election.
Flannery: What do you make of China’s probe into Micron?
Cooke: We can dissect it into several elements. One is a desire for reciprocity and being seen on an equal plane. And so with Biden’s CHIPS Act, and the singling out of TikTok and a lot of different Chinese companies in U.S. security investigations, it’s to be expected that there is going to be some reciprocal action that China is going to want to take to be seen as a peer power demanding reciprocity.
That diplomatic posturing is understandable but it does have a chilling effect for potential foreign investors — definitely on the U.S. business community. Close allies in Europe and elsewhere notice it, and it doesn’t help China’s post-pandemic effort to show a welcoming face to foreign investment.
I think there is also a third element of it that is interesting: perhaps as another data-point showing a lack of coordination in Chinese policy and messaging that we see from time to time. And we’re living in a world where nobody is a paragon and the U.S. has its own challenges with coordinating its message. But in China, as we saw recently with ‘wolf-diplomacy’ and the balloon incident, people lower in the governmental hierarchy vie to please their superiors, and end up getting out in front of the intended policy and in front of what would be an optimal coordinated policy for China. And I’m wondering personally whether Micron might be an instance of that.
Flannery: Speaking about both semiconductors and Taiwan, does the U.S. rely on Taiwan too much for chips?
Cooke: It’s actually in almost everyone’s interest at this point to have a greater degree of global diversification. It’s outright dangerous to have close to 90% of production of the world’s most advanced semiconductors taking place only 90 miles away from the Chinese mainland.
Flannery: Does the CHIPS Act go far enough in striking a new balance?
Cooke: Before the CHIPS Act, Taiwan Semiconductor Manufacturing Company (TSMC) was already taking steps (to diversify from Taiwan). There are currently moves afoot in Germany for automotive chip production — not the most advanced chips in the world — but also with Japan for consumer electronics and with Arizona for an advanced generation of chips. (See related post here.) For the foreseeable future, production of ultra-advanced chips will stay in Taiwan. But I think a lot of production capacity for quite advanced chips is being pushed out of Taiwan to these other global nodes.
The CHIPS Act is to my mind pretty fascinating. As a response to China’s Made-In-China-2025 ambitions and its military upgrading, it’s a bulls-eye in my view. But, as a policy undertaking in the U.S. domestic context, it is something of a potential third rail in the sense that, as a country, we’ve never been comfortable or particularly skilled at industrial policy. And it is clearly industrial policy.
Interestingly, I think there is enough bipartisan support right now that the industrial policy-political debate on Capitol Hill is not the traditional debate of “no industrial policy” versus, let’s say, the Clinton era’s “auto industrial policy for Japan.” Nobody at this point seems to be openly challenging the need for an industrial policy response to China’s advanced technology challenge.
So the debate currently is one about “clean” industrial policy versus industrial policy with social agenda items folded into it, like childcare support for workers. (Either way) it is important as a signal to the market about U.S. government resolve.
Flannery: Is it enough? And if it’s not enough, what’s the next step?
Cooke: If, in version one, the sum had been significantly higher than $52 billion, it would have been almost setting itself up for failure, because there are so many things that can go wrong in operationalizing and implementing something like this.
By analogy in the military sphere, we have put in a very robust sanctions regime against Russia following the invasion of Ukraine. But it was kind of uncharted territory. There’s been a lot of analysis about what’s been working and what hasn’t been working. We’re groping our way forward and want to keep some powder dry.
The CHIPS Act is similar in the commercial sphere — kind of uncharted territory. One of the things it has going for is that Commerce Secretary Gina Raimondo is an astute leader of the process. In the current political environment, any sign of dropping the ball would be pounced on. What is actually more important than the amount of money is the fact that it has happened in an initial iteration. There can be subsequent iterations, but it’s important to operationalize the first iteration as well as possible and to learn from that process to inform a potential second iteration.
Flannery: There is controversy about social goals being attached to it.
Cooke: The Act was passed by Congress last year, and it went into a kind of holding period where no one knew what the process was going to be for a company to apply. When the guidelines were only recently announced, it became clear that there was quite a lot of conditionality put on the ability of a company to apply. One set of conditions has to do with an applicant limiting its China business for a 10-year period. Another quite different set has to do with an awarded company providing childcare for its employees.
I think the criticism about these conditions is a fairly predictable output from the Washington DC political meat grinder. Because these are tax-payer dollars, the back-and-forth is highly political. Placing limitations on future China business for awardees makes sense to the average American voter. However, those limitations raise serious concerns for the CEO of a sizable company that doesn’t want to decouple from the China market but does want to access CHIPS Act support. On the separate issue of childcare, this requirement is meant as an incentive to help overcome the problem of a shortage of chip production workers in the U.S but it obviously becomes a red meat talking point for politicians who position themselves as anti-woke in U.S. culture wars skirmishing.
This goes back to what we were talking about before with Micron. China is currently unable to respond in a meaningfully reciprocal way when the U.S. does things like put Chinese billionaires onto an entities list. They just don’t have a global finance tool that is anywhere near as sharp and strong as is found in the U.S. Treasury toolkit. For the U.S., putting companies on an entities list works— it catches the attention of targeted individuals and there is an important and broad public messaging dimension to it as well. Of course, to make sanctions really bite, there’s a lot of operationalization that needs to happen but doesn’t always happen.
What I personally believe is: China’s main effort now is to try to knock the dollar off its post-World War II throne. Others have tried and failed and it will be a hard thing for China to pull off. But I believe that’s this the main thrust of their effort and the primary aim of a long-term, patient strategy.
See related posts:
U.S. Businesses Look To De-Risk, Not Decouple, Their China Ties
U.S.-China Collaboration Could Cut Development Time, Cost For New Cancer Treatments
TSMC Will Triple Arizona Investment To $40 Billion, Among Largest Foreign Outlays
Taiwan’s Biggest Silicon Wafer Maker Eyes U.S. Solar Industry Investment
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(End article)
I join Russell in inviting you to leave your thoughts or questions in the Comment section below. (Because of netizen ire in China, I have not always kept the Comments section open in Assessing China but it is open for this post. I would love to hear from you).
A few hours ago, Taiwan’s President Tsai Ing-wen arrived at her hotel in New York where she is transiting en route to a 10-day visit to treaty allies Guatemala and Belize followed by a return transit stop in Los Angeles on her way home. Three days ago, former Taiwan President Ma Ying-jeou arrived in Shanghai to start an 11-day, multi-city visit focused on educational exchange and paying his respects to his ancestral home. Tsai Ing-wen’s transit stops in the U.S. are hardly unprecedented — she has made six — but comes at a time of unprecedented tension in the U.S.-China relationship. Ma Ying-jeou’s visit to the mainland is flat-out unprecedented. Since the establishment of the Peoples Republic of China in 1949, no Taiwanese former President has ever set foot there. Today, and over the next week and a half, the world will be witnessing a historic split-screen.
During my time as the head of the Commercial Section at the American Institute in Taiwan from 1999 to 2002, I met quite often with both Tsai Ing-wen and Ma Ying-jeou. I have a sense of their personalities and their values. What is behind their divergent itineraries right now is of course politics. Tsai Ing-wen is the incumbent President and leader of the Democratic Progressive Party (DPP). Ma Ying-jeou is a former President and the elder statesman of the Kuomintang (KMT), Chiang Kai-shek’s party which fought with the Chinese Communist Party in the mainland and then fled to Taiwan in 1949.
Taiwan’s next Presidential election — in which Tsai Ing-wen is ineligible to run having served two terms — happens next February. Ma Ying-jeou’s visit to the mainland is inextricably tied up with that upcoming election. Tsai Ing-wen’s visit is not disconnected from that upcoming election but is more entangled with steadily worsening U.S.-China relations and the continuing fall-out from then House Speaker Nancy Pelosi’s visit to Taiwan last August.
Over the next two weeks, I will have occasion to post commentary here on what transpires during these two trips and what they portend for the coming months. Today’s Historic Split-Screen post is just to set that stage.
Xi Jinping departed Moscow eight days ago following his three-day state visit. In broad brush, the trip removed some uncertainties about the basic direction of Xi’s positioning on the global stage. No, this was not a peace-broker’s mission. Xi clearly prioritized propping up a faltering “friend without limits” over any serious — or even half-hearted — effort to play the honest broker. Washington and Kyiv still want Xi to talk with Zelensky (likely) or perhaps even visit Kyiv (unlikely) but the aim is not for any mediation by Xi but rather to reinforce the messaging to Xi about not sending lethal armaments to Russia. And, no, Xi seems quite clearly to be prioritizing the recovery of his wobbly economy over the risk of sanctions from the U.S., Europe and key Asian partners should he defy the Biden Administration red-line against China supplying Russia with lethal armaments.
As the third door opens, it’s now possible to glimpse some of the finer brush-strokes of Xi’s long-term plan to counter the liberal, rules-based world order. These are revealed in the 9-point joint statement released by Putin and Xi at the conclusion of Xi’s Moscow visit as well through related moves by China on the world stage. Five of the more subtle brush-strokes to observe:
- Xi used his trip to signal to Washington and to NATO and its other democratic allies that China now largely has Russia under its thumb. It can draw increasingly on Russia as a plentiful supply of heavily-discounted oil and other energy resources. Similarly, it can address its own food insecurity and inflation concerns by throwing its market open to Russian food commodities at cut-rate prices. It can force Russian banks and the Russian financial system to do its bidding (see next point). And it can count on Russia to parrot its propaganda line with particular focus on Africa, South America and the Pacific region. All of this serves to prop up Putin and prolong the war, serving Xi’s interests without triggering retaliation against China.
- Xi revealed that his weapon of choice to counter the post-WWII world order will not be lethal armament deliveries to Moscow but the Chinese yuan (RMB, renminbi). Moreover, he put the brush in Putin’s hand for this particular stroke. Towards the end of the summit, Putin pointedly stated “We (Putin and Xi) are in favor of using the Chinese yuan for settlements between Russia and the countries of Asia, Africa and Latin America.” From a broad strategic perspective, it makes perfect sense that Xi would choose this approach. Why risk retaliation by getting involved in a hot war in Europe (where Russia is losing ground), when China can force Russia to support a Chinese-led challenge to U.S. dollar domination elsewhere throughout the world. The standing of the dollar as the world’s reserve currency is arguably the United States’ most potent, non-military asset globally. Others have tried to dislodge it and have failed. But, as the world’s second largest economy, as the de facto leader of the developing world for the past 50 years, and as a vise-grip political command structure, Xi clearly sees this approach as his best bet for now (while the Taiwan issue still hangs unresolved in the background).
- Putin’s statement comes not as an announcement of any new undertaking by Xi but rather as an exclamation point on an ever-evolving geo-strategic campaign which Xi has been conducting in Asia, Africa and Latin America since 2012 in the form of Belt and Road Initiative (BRI). There is particular urgency to this campaign now in the wake of the COVID pandemic and the recent rapid rise in U.S. interest rates. As a result of these developments, many BRI partner/client countries now find themselves unable to service their earlier loan obligations to China. To adjust, China has been forced to dramatically increase its overall lending through loan restructurings to keep major BRI projects afloat. As a result, Chinese lending to debt-ridden countries now stands at more than $40 billion, not far off the level of the traditional, post-WWII lender of last resort, the International Monetary Fund (IMF), whose loan exposure stands at more than $65 billion. While a strain on PRC finances, this hefty lending posture gives Xi the ability to speak softly (through Putin) while carrying a big stick against the dollar-denominated international order.
- China’s burst of Mid-East diplomacy is a further brush-stroke filling out this picture. The opportunistic stage-craft positioning PRC Foreign Minister Wang Yi as the go-between in the mid-March entente between Saudi Arabia and Iran — which was happening anyhow — was meticulously executed. Likewise, the bullhorn which the Foreign Ministry has used to welcome the possibility of rapprochement between Saudi Arabia and Syria is notable. All of this is leading up to a summit between Iran and the six-nation Gulf Cooperation Council in Beijing in the fall. Against the broad backdrop of events, it is certainly not a coincidence that Mohammed bin Salman, Saudi Arabia’s leader, has been mentioning under his breath the possiblity of settling more of his country’s oil exports with the Chinese yuan.
- A final point is the deep planning behind what is now unfolding. None of this reflects ad hoc or reactive moves in response to the Ukraine crisis. Instead, this plan is organically tied to the development of the ten-year-old Belt and Road Initiative and signs of it became clearer with the convening of the 20th Party Congress last October, with the unveiling of the CCP’s newest Five Year Plan (FYP) and with the announcement of the country’s new ministerial line-up at the Two Sessions meetings in Beijing earlier this month. In hindsight, the strongest proof of this is in the meeting just concluded with Putin. Ukraine was just a minor, slightly discomfiting blip for Xi in Moscow last week, just as it was only a blip for Xi when Putin invaded Ukraine just days after their meeting in Beijing in February 2022 on the eve of the Olympics. Xi is extolled in China as being “unswerving.” At least as far as his plan to offer an alternative world order is concerned, this characterization is apt. No swerving from the plan just because of an unprovoked invasion of a sovereign nation by his Russian friend. As Alexander Korolev’s (University of New South Wales) observed regarding the Xi-Putin 9-point joint statement: “It looks like a strategic plan for a decade or even more. It’s not a knee-jerk reaction to the war in Ukraine.” Fits in well with the three 5-year chapters through which Xi has been telling his heroic ‘rejuvenation of China’ story. A story that can’t end well for Xi without closing the book on Taiwan.
Xi Jinping arrived in Moscow yesterday for the start of a three-day state visit, his first trip overseas since securing his unprecedented third-five year term as head of the party and president of the country. Yesterday’s meeting was heavy with symbolism — the two leaders exchanged greetings and expression of friendship seated together intimately in front of a fireplace — but devoid of substance. The first solid indication of the substantive direction their talks are taking will happen in a few hours during a press event scheduled to take place prior to their formal dinner. That direction will be further mapped out at the conclusion of the state visit tomorrow immediately prior to the departure from Moscow of Xi Jinping and his delegation.
These meetings are being closely watched because they will reveal which of three starkly different paths the two leaders will choose.
Behind Door Number 1 is the possibility that Xi will show determination to be the peace-broker he postured as with the release of his PRC Position on the Political Settlement of the Ukraine Crisis 12-point plan late last month. This would mean exerting real pressure to overcome the mutually-incompatible public positions of Russia (i.e., that no negotiations are possible until Ukraine formally cedes those territories in eastern Ukraine which Russia currently occupies) and of Ukraine (i.e., that no negotiations are possible until Russia completely relinquishes all territories it has occupied since Russia’s 2022 invasion and possibly also the Crimean territories seized in 2014 though there is not clarity on that latter point). There is no question that Xi has the means to move Putin in this direction if he should choose to. It would suffice for Xi to threaten to drastically reduce purchase of Russian oil, to limit export of Chinese microchips and other vital but non-lethal supplies which prop up Putin’s war effort, and to distance himself from Putin on the world stage. The reason this door will stay closed, though, is two-fold. First, Xi has no means available to bring Kyiv along in this direction. Xi’s platitudes about the cessation of hostilities and entering into talks is an absolute non-starter for Zelensky and his committed backers in the U.S., Europe and elsewhere. It would simply freeze Russian gains in place and allow Moscow’s forces time to regroup. Nor does Xi have any realistic standing to leverage world opinion to pressure Zelensky to move in a direction he’s dead-set against. Even for Brazil, Hungary, India, Indonesia and the other influential fence-sitters, what Beijing has been doing over the past year (supporting Russia in myriad ways right up to the red-line of supplying lethal equipment) outweighs what it has recently been saying about weighing in as a mediator and potential peace-broker. Beijing had not yet even opened up a channel of communication with Kyiv until a few days ago and that only at the Foreign Minister level. Yes, the U.S. and its allies have been loudly supportive of Xi reaching out to Zelensky but that is not because they see that as a step toward a PRC-brokered ceasefire. They’re advocating this because they know how passionately persuasive Zelensky can be about Ukraine’s position on the right side of history and hope that direct communication with Zelensky would give Xi further pause in any consideration of supplying Russia with lethal armaments.
Behind Door Number 2 is the possibility that Xi and Putin will use their time behind closed doors to hammer out an agreement through which China bolsters Moscow’s faltering war effort with a meaningful level, either quantitatively or qualitatively, of lethal munitions. This represents the ‘red line’ which SecState Blinken has been publicly warning Xi to back off from in recent weeks. It would represent a watershed development for two reasons. First, it would prove beyond argument the hollowness of Beijing’s posture of neutrality. Short of such military supply, Beijing has already deployed all the tools at its disposal to help Moscow — using its manufacturing strength to supply the Russian military with dual-use technologies, using its economy to shore up the vital Russian energy sector, using its currency to help prop up the ruble, using its propaganda organs to parrot Moscow’s line on the causes of the war and even its Special Military Operation terminology, using its diplomacy to provide Putin (fresh from the International Criminal Court in the Hague issuing an arrest warrant for him) with ‘diplomatic cover.’ Second, Russia’s supply of military-use drones, ammunition, and artillery has the potential to significantly change the battlefield. Perhaps not to the degree to allow the poorly-performing Russian military to realize its maximalist territorial objectives; but definitely enough to prolong the military see-saw and reenergize Putin’s strategy of outlasting the fractious democracies supporting Ukraine. Should Xi accede to this course of action behind closed doors, it would not remain a secret for any length of time. Beyond the ability of the U.S. intelligence community to pick up on this new move through monitoring communications — both PRC internal communications and government-to-industry communications — the appearance of Chinese armaments on the battlefield would be instantly recognized and highlighted by the Ukrainian military. The consequences would be immediate and disastrous for China’s wobbly economic recovery. Sanctions from the U.S. and Europe — China’s two largest trading markets — could conceivably be enough to knock 1-2% off China’s economic growth in 2023. Under that scenario, China’s GDP growth would fall to 3% or under for three of the last four years. Such a prolonged period of low growth could well mean that China never manages the leap which Japan, Singapore, South Korea, and Taiwan have previously managed from being a manufacturing labor-led economy to being an innovation-led developed economy. Being consigned to this so-called “middle income trap” while simultaneously being trapped in demographic collapse would, quite simply, mean the end of Xi’s vision of national rejuvenation. More precariously for Xi, it would mean an end to the 100 Years Long March which Xi’s predecessors and compatriots in the Chinese Communist Party have been journeying on since 1949 (and even before). Xi understands this and Door 2 will not be flung open.
That leaves Door 3. This is the path of steady-as-she-goes with all of its inherent contradictions and all of its incremental pluses-and-minuses. Xi is determined to strike certain poses on the world stage and those may now be spotlighted and amplified: the posture of exaggerated friendship and increasing fraternization with a former Communist super-power is essential to the realization of the ‘Big Power’ role which Xi has set for China in his third term as well as for the ballast which it provides Xi in projecting himself as leader of an alternative to the liberal, U.S.-led, post-WW2 order. At a symbolic level, Xi can continue to ratchet up this image for a global audience, as he is doing currently with this visit to Moscow. At the level of practice, however, Xi cannot afford to risk further blows to China’s economy. He will refrain from taking any decisive step towards arming Moscow. In so doing, he will doubtless look for additional ways to support Putin’s war effort at the margins while forestalling any large-scale economic retaliation from the U.S. and other global Ukraine coalition countries.. This symbolism-heavy, practical-action-light approach follows the game-plan which Xi successfully ran with the militarization of the islands and reefs in the South and East China Seas. Taking a series of small steps, each of which was just below the threshold of triggering a forceful reaction from the U.S. and its allies, but which cumulatively over time secured the strategic objective he was seeking. The “boil a frog slowly’ strategy. Just as importantly, it is strongly in Xi’s interest that Russia not suffer sudden defeat and “disappear” from the global stage. Xi’s interest is for Russia’s to remain on stage but moving gradually away from center-stage to make room for China’s more prominent presence there. This shift is already well underway as China, on a daily basis, gains increasing control over Russia’s energy market, its financial sector, its diplomacy and its geopolitical positioning vis-a-vis Siberia and the Russian East.
My prediction for what will unfold later today and tomorrow — and then subsequently in the aftermath of Xi’s visit — is the gradual opening of Door Number Three. That is not to say that Xi could not ultimately surprise us. He has proven himself to be a risk-taker — and has gotten off lightly — with both the South & East China Seas militarization and with the Basic Security Law takeover of Hong Kong. Could he open Door Number 2? Yes, possibly. Alternatively, he possibly has something up his sleeve to entice Zelensky into talks with. Is Door Number 1 locked, bolted and sealed shut? No. But there’s no reason to believe that Xi wants to put in the hard work to open that door. Whatever ultimately transpires, though, the prize for Xi lies behind Door Number 3. He is shrewd enough to know that and act on it.
Less than twenty-four hours ago, Xi Jinping was officially confirmed for his third term as President of the People’s Republic of China at the Two Sessions meetings in Beijing. This ribbon-tying exercise completes a package of norm-shattering consolidation of power put in place last fall at the 22nd National People’s Congress. At each iteration, the NPC shuffles and updates the power structure within the China Communist Party and, a half-year later, the Two Sessions then translates those positions of power into the State Council and other organs of national administration. The CCP controls the “goods” of authority and power, the State Council just “delivers” them.
In the week leading up to Xi’s securing a historic third term as President at this year’s Two Sessions, there was a war of words between China and the U.S. about the future of the U.S.-China relationship and, by extension, the world. Over the next week, I will peel back a couple of layers of that particular onion including my thoughts on the role being played by Qin Gang, Xi’s newly-appointed Foreign Minister fresh from his most recent assignment as Ambassador to the United States.
As for today, the focus is on highly-encoded pronouncements…
Politically, the Chinese Communist Party has a well-established practice of formulating, and telegraphing, its most-determined policy directions in Five Year Plans and in periodic, quite abstruse revisions to the pantheon of CCP ideology (such as the replacement of Deng Xiaoping’s “great international circulation” theory by Xi’s “dual circulation” theory in 2020). Although highly-revealing of PRC political intentions, this is head-spinning stuff and requires both facility with the Chinese language and a questing spirit to enter the labyrinth of PRC ideological discourse.
There is a simpler, pithier way to read the tea-leaves, however. Culturally, the Chinese language has a genius for encoding highly complex thinking in short bursts of characters, as illustrated most commonly by the pervasive use of 成语 four-character expressions. This predisposition to distill complexity into concise character sets shows itself in occasional 24-character sets of instruction delivered by China’s top leaders. Very occasional, highly formulaic, deeply revealing.
Until this year’s Two Sessions, the last of these had been delivered by Deng Xiaoping in 1990, following the convulsion of Tiananmen and in the lead-up to his recommitment to capitalism with Chinese characteristics during his Southern Tour. That 24 character edit read:
冷静观察 Observe calmly
稳住阵脚 secure our position
沉着应付 cope with affairs calmly
韬 光养晦 hide our capacities and bide our time
善于守拙 be good at maintaining a low profile
决不当头 never claim leadership
During the past week’s Two Sessions, Xi Jinping provided his oracular update to Deng Xiaoping’s pronouncement (and, in so doing, continued his program of positioning himself center-stage with Mao and relegating Deng to the wings). Xi’s version reads:
沉着冷静 Be calm
保持定力 keep determined
稳中求进 seek progress & stability
积极作为 be proactive & achieve things
团结一致 unite (under the banner of the party)
敢于斗争 dare to fight
As with Chinese four character expressions, a few words can speak volumes. Xi’s words — and his insertions of change within a decades-old formula of continuity — speak for themselves.
P.S. I am indebted to Moritz Rudolf for his translation of these two 24-character auguries. His translation is better than mine would have been.
Yesterday President Aleksandr Lukashenko, President of Belarus, arrived in Beijing for a three-day state visit. Lukashenko is, of course, the world leader who allowed Putin to amass Russian troops on Belarus’ border with Ukraine during the lead-up to the Russian invasion on February 24th of last year.
Coming on the heels of the release of the PRC Position on the Settlement of the Ukraine Crisis document by Beijing last Friday some — including both cock-eyed optimists and doomsday prophesiers — will see this as an encouraging sign that Xi Jinping is busy rallying support for his effort to bring hostilities in Ukraine to an end. A deeper look reveals the likelihood of almost the exact opposite to be the case.
For three years of the pandemic, Xi did not travel outside of China’s borders and welcomed almost no foreign leaders to China. The one notable exception to this self-imposed isolation was his summit meeting with Putin in Beijing on February 4, 2022 on the eve of the Beijing Winter Olympics. This is, of course, the meeting where Xi famously announced a “friendship without limits” with Russia. Less than three weeks later, Russian troops poured into Ukraine. Less well remembered about their joint statement is the fact that, as reported by Gideon Rachman in the Financial Times, “the February 4 statement made it clear that the foundation of the Russian-Chinese friendship is shared hostility to American global leadership.”
Since the beginning of February, Xi and his Foreign Ministry have been making up for lost time with a whirlwind of diplomatic engagements internationally. Xi dispatched his senior foreign policy advisor, Wang Yi, to a string of European capitals with a dual agenda. Wang traveled to France and Italy where business constituencies welcomed China’s invitation to revive economic ties following self-inflicted pandemic damage to the Chinese economy. Included in Wang’s itinerary was a red-carpet visit to Hungary hosted by Hungary’s Russia-friendly President, Viktor Orbán. Finally, before heading to Moscow for the capstone of his trip, Wang put in a visit to Munich where NATO member countries were taking part in the annual Munich Security Conference. For this visit, Wang shelved his economic message and tried driving a wedge between the U.S. and its European partners with some of the same anti-U.S. messaging (e.g., need to repudiate the United States’ Cold War mentality) which Xi and Putin had settled on a year earlier and which China has enshrined as Point 2 in its PRC Position on the Settlement of the Ukraine Crisis. Wang was widely derided for striding into that meeting with a tin ear and two left feet. Especially in the wake of the “weather balloon” imbroglio, his message there went over like a lead balloon. Later, in Moscow, Wang and Putin announced with fanfare additional steps to strengthen China-Russia solidarity.
So what about meetings which Xi has hosted back home in Beijing during this February and early March whirlwind? Well, in addition to the centerpiece of the three-day state visit by Lukashenko, there have two other notable high-level visitors; President Ebrahim Raisi of Iran and Prime Minister Hun Sen of Cambodia.
By thy friends, we will know thee. These friendships are clearly not designed to advance a good-faith mediation effort to bring a sovereignity-respecting solution to Ukraine. They are designed to tighten bonds with authoritarian leaders attuned to, and aligned with, the anti-democratic bloc which Xi has been committed to building in his third term.
As argued last week in 1% Words, 99% Work, Xi’s aim with his Settlement of the Ukraine Crisis position paper is not to bring about a just and durable peace in Ukraine, it is to serve his own agenda. That agenda is clearly revealed by China’s behind-the-scenes, multi-pronged effort to support Russia in the conflict.
By blurring the lines of a stark conflict between authoritarian overreach and democratic resistance, Xi’s intervention serves to confuse the world community with the likely effect being rob prolong the conflict. Prolonging the conflict would in turn serve to keep U. S. attention and resources further pinned down in Central Europe and diverted from China and the Taiwan Strait. Exactly what Xi wants.
In my network, there’s a lot of interest in — and considerable disagreement over — the meaningfulness of the PRC statement of principles toward resolving the Ukraine crisis released on Friday. I gave my on-the-spot personal view in the post 1% Words, 99% Work on the day of the statement’s release but, since then, I have been fielding comments and questions from a number of friends and associates.
I am going to share here one of those conversations. The questions were posed to me by another college classmate, in this case a person with a lifetime of deep and wide professional experience in China. I hope that these questions and answers might prompt readers of Assessing China to continue to think about this issue in a curiosity-forward and thoughtful way.
Here is the Q&A exchange:
What factual inaccuracies do you find in it (the official PRC Position on the Political Settlement of the Ukraine Crisis)?
- It’s important to note at the outset that this is a position paper (clarifying the PRC’s own position) rather than a peace proposal (aimed at bringing the two warring sides together). With that in mind, the PRC is perfectly entitled to set out their position in any 12 — or any 120 — points which they chose. However, it is also clear that they are using this position paper in order to position themselves to be seen as a potential mediator between the two warring parties. Whether they pull off that positioning exercise depends both on whether the PRC proves ready, willing and able to play that role and whether key parties to the conflict support them playing that role.
- Factual problems are only one dimension of what can be problematic in a document like this. On the factual inaccuracy front, I will limit myself to the very first point. Since 1945, there has been no definition of sovereignity which squares with Russia’s invasion. To this day, China has backed Putin’s language (a special military operation, not a war or invasion) and its worldview (revanchism and restoration by force of past empire are legit). If you can’t get past the first principle, it’s hard to take the rest of the document seriously. For the rest …
- Point 2: A dig at the U.S. An assertion with no real substance.
- Point 3: The question is how and under whose terms: 21st c. norms of forward-looking sovereignity protecting the rights of citizenry developed over the past 75+ years or the Putin/Xi aggrieved, backward-looking version all in the mind of an individual leader with the power to enforce conformity to his — it’s usually a man — viewpoint
- Point 4: We can all hope for peace talks but neither of the warring party appears ready to consider these. They each hope to establish a position of strength before entering into them. Temporary stalemate.
- Point 5: There’s a lot China could do unilaterally on this point. Words are cheap. The U.S and the West have demonstrably done a lot already. China?
- Points 6, 7, 8 & 9: Who has been the responsible party for these specific problems? Hardly a gray area to my mind. Russian summary execution of captured soldiers and civilians in Bukha and other villages they invaded and occupied. Russian forcible evacuations of children to camps in Russia. Russian sustained artillery assaults on the nuclear plant at Zaporizhzhia (not to mention indiscriminate attacks on civilian infrastructure). Russian interdiction of Ukrainian grain exports at ports and railways. What are the comparables from the Ukrainian side? I personally don’t think there are many but, in any case, law always gives special consideration to the responder rather than the initiator, the defender rather than the attacker.
- Point 10: Equivalent to stripping Ukraine of one of the ways which the world community has provided to help them defend themselves.
- Points 11 & 12: We can all agree that these would be desirable
And what’s your view on why U.S hegemony has been good for the world for the last 70 years, despite some of the bad that we did?
- I’ll just offer two points of response
- Providing the world with a longer period of sustained peace — not perfect of course but far better than anything that preceded it — and also more measurable human advancement (educational, health, wealth, human rights) than previously achieved at any point in history
- Providing China with the opportunity, tools and resources to help raise 800 million of their citizens out of poverty
If “U.S. hegemony” is just part of China’s ideology, isn’t “democracy vs. autocracy” part of our ideology?
- I quite agree with you about the “U.S. hegemony” as contrasted with the “autocracy vs democracy” point. There are levels to that though and I focus on the third level:
- Level 1: both terms are established political science terms and describe real things in international behavior
- Level 2: as is their right, both Beijing and Washington choose to amplify the political concept that best suits their purpose
- Level 3: I come down against ceding there is equivalency between the two for two reasons:
- Focus on ‘hegemony’ is rooted in a sense of historical grievance and doesn’t offer the world much unless other players share that grievance and all agree to do something about it. ‘Authoritarianism vs democracy’ draws a clear distinction between two different systems and encourages everyone to think about, and ultimately choose, their preference. Xi is at liberty to assert China offers a superior form of democracy to Western liberal democracy. Not many governments or people around the world seem to buy into that. The U.S. has over 65 formal allies based on shared values rooted in liberal democracy and the post-WWII order. China has one — North Korea — and is working hard at adding Russia and Iran to the list
- There’s no inherent accountability to Xi’s and China’s use of the term hegemon in describing the U.S. Top-down and echoed throughout a propaganda apparatus which can’t be questioned because, as Marxist-Leninist doctrine holds, it definitionally represents what is best for the people. In the Biden Administration’s amplifying of “authoritarianism vs democracy” however, it can be questioned and jettisoned come January 2025 if that is the will of the majority of Americans.
Washington had been urging China since the beginning of Russia’s war to play some role in peace negotiations, and now it has offered to do so, outlining the basic principles. I think that’s a good thing. The U.S. cannot be an honest broker, nor can any country in NATO. Perhaps China could pay a useful role in stopping the fighting.
- I think what the U.S. has been urging China is (1) aspirationally, to encourage China to come down from fence-sitting and use its suasion with Moscow to promote post-WWII norms of sovereignity (versus might makes right) but (2) more importantly not to aid and abet the instigator in this war of choice with sanctions-cushioning actions and (c) definitely, definitely not with sanctions-evading support and supply of lethal munitions. China has chosen to completely reject (1) and (2) and, as for (3), is in advanced negotiation with Russia to set pricing and scale of supply for offensive drones and ammunition, possibly also artillery.
- The U.S. and NATO don’t offer themselves or pretend to be honest brokers. They have clearly taken the side and will continue to take the side of Ukraine since Feb 24, 2022. The fundamental problem is that China is trying to have its cake and eat it too — on the one hand, giving consistent, significant and now increasing levels of support for Russia over the past twelve months while also now posturing with this position paper as a potential honest broker. I share your hopes and think its good that Zelinsky will meet with Xi. I just don’t expect that, in the final analysis, much will come of it for the reasons outlined above.
My concluding comment: I commend this interlocutor for asking thoughtful and useful questions. Many of the exchanges I had were with people who wanted to convince me that their interpretation of the situation was the correct one. One of the common denominators of those perspectives seems rooted in fear … fear of the Ukraine crisis spilling over into nuclear strikes, fear of the U.S. government missing a chance to work with China to resolve the situation, fear of the U.S. finding itself on the wrong side of history as Brazil, Hungary, Saudi Arabia, Turkey, South Africa, India and Indonesia gravitate into a Chinese orbit. I personally do not share those fears. In fact, I believe that the surest way of avoiding any of those scenarios becoming even plausible is for us to lose the clear-sightedness and the bedrock values which have guided our reaction to Russia and China since February 24, 2021.
On the one-year anniversary of Russia’s invasion of Ukraine, China has released its 12-point peace proposal. The official English-language version is here. Below is a simplified graphic covering the 12 points.
Here’s my 4-point response:
- There’s no reason to go beyond the first point. If that were to be upheld, there would be no ‘special military operation’ crisis to solve.
- China is not a credible or honest broker to bring about peace. Just look at its year-long pro-Russia messaging campaign — both domestically and internationally — and its well-documented sanctions cushioning and sanctions evasion assistance to Russia (oil purchases, currency support, dual-use supplies (microchips, electronics, etc) and now on the verge of adding artillery, drones and other lethal military hardware to the list). Zelensky is willing to talk to China but only in the hope that China will pressure Putin to back off. Unlikely China will apply that pressure in any way forceful enough for Putin to give it a second thought.
- Words are the easy part. Brokering peace is 99% about engaging in good faith and intensive consulations with both sides and then buckling down to sustained application of leverage and excruciating follow-through. There’s no indication that Beijing is ready to undertake — or even interested in undertaking — this hard part.
- The document primarily serves Xi Jinping’s purposes rather than Kyiv’s and Moscow’s. It gives him a modicum of ballast as he postures as sitting on the fence whereas, in reality, he has a foot firmly down on Moscow’s side and his “frirendship without limits.” Additionally, it serves to score points against the U.S. in line with his new “direct confrontation with the United States” policy while also providing some catnip to non-aligned global players like Brazil, Hungary, Turkey, South Africa, India and Indonesia.
In short, non-credible but a sly and carefully orchestrated move to advance Xi Jinping’s own gameplan.
P.S. Since today is the one-year anniversary of Russia’s invasion of Ukraine, I am providing a link here back to the post I made on the eve of that invasion on February 21, 2022. It has unsettling resonances when reconsidered one year later.
______Assessing China / The TEA Collaborative______ 