After a long preparatory work and thanks to the strong mindedness that we already recognize to him, on March 10, 2018 Xi Jinping succeeded in imposing – with 99.86% of favourable votes – a constitutional reform enabling him to extend his stay in power without time limits.
It should be recalled that the maximum limit of the two consecutive terms of office was introduced by Deng Xiaoping in 1982 to avoid the danger of a “personalistic drift” (as Deng himself called it), which – according to that ruling class, just getting over the Red Guards’ harsh attacks -had characterized the last phase of Mao Zedong’s regime.
After stabilizing his power within the Party and the State – with his loyal aides, such as Wang Qishan, who managed the world financial crisis of 2008-2010 and the relations with the United States, as well as Deputy-Prime Minister Liu He, supervising economic and financial policy, and Yi Gang, the Governor of the Central Bank – President Xi Jinping established a large and cohesive negotiating group for international economic and financial affairs, above all with the United States. In 2017 the United States managed a trade surplus of 375 billion US dollars in favour of China, as well as a volume of Chinese investment in US Treasury bills equal to 1,200 billion US dollars and many other operations. At the core of them there is the New Silk Road, which will characterize the strategic-economic and geopolitical nature of China’s current foreign policy.
Power projection in the Heartland and US potential exclusion from it.
As Brzezinsky said, when the Heartland is united with the Eurasian peninsula, there will be the end of US hegemony. Both in Europe and in the rest of the world.
Furthermore,Liu He and Yi Gang spent long periods in the United States to study international finance and political science.
The powerful anti-corruption campaign also contributed to the quick and effective results of this great change in China’s leadership. Besides the thoroughcontrol ofthe ways and procedures to select both the middle-low and upperranks of the Party and the State, carried out directly by President Xi Jinping’s “internal” group, said campaign was organized also by Wang Qishan, the powerful Head of the new Party’s “control commission” and very loyal to President Xi Jinping.
An essential aspect of foreign policy, which for President Xi Jinping and his team is mainly economic and financial foreign policy, is the establishment of independent Chinese initiatives abroad, in addition to expanding China’s role in the WTO and in the other international organizations.
It is by no mere coincidence that the Chinese intelligence services have a section dealing with the “use of international standards”.
Initiatives such as the Investment Bank for Asian Infrastructure (in which also Italy participates) and the BRICS Investment Bank, which are essential for understanding the role of China as a country within the world trade flows, but also its strong geopolitical autonomy.
These phenomena will emerge above all in the 75 countries that have already joined the New Silk Road.
Economic ties with China, but adhesion of the 75 countries to China’s unwritten project of hegemony in the new world order, which today, in particular, appears as a structural weakening of the United States.
With specific reference to diplomacy, the recently-drafted “Xi Jinping’s Thought on Diplomacy” envisages that – as already done for seven decades -the Party develops a diplomacy thought “with Chinese characteristics” and that this Thought is defined directly by the CPC leaders.
While today’s world is infinitely complex, as Chinese leaders maintain, the Chinese diplomacy must also reach a new starting point.
A new starting point that simplifies the initial approach and leads to a New World Order, not focused on the United States, but linked – if anything – to a Chinese diplomacy operating bilaterally in all economic and political spheres and in all areas of the world.
Hence, following President Xi Jinping’s diplomatic policy line means – first and foremost -to remain loyal to the peaceful development pathway, with a view to furthering cooperation with all countries to achieve win-win results. It also means to support the formal architecture of the current international system, with a view to finally achieving a better external environment for all States and making definitive progress towards world peace and human progress.
Hence President Xi Jinping’s diplomacy means – first and foremost-support for the gradual and ongoing opening up of global markets, especially today when Western countries tend to protectionism, but is also designed to foster relations with the countries that the West is neglecting or still considers mere “deposits of raw materials”, such as Africa or Latin America.Said diplomacy, however, works above all to avoid the creation of hotbeds of crisis.
In a nutshell,albeit with some degree of legitimate simplification, President Xi Jinping is turning most of Mao Zedong’s “Three Worlds Theory” into diplomacy doctrine.
It should be recalled that it is a classification dividing the countries according to their hegemonic claims and designs, as well as to their power projection.
The “imperialist” West and the “revisionist” USSR, or rather the First World, would wear themselves out, with their cold wars, on the ground of the “great European plain” they both want to conquer, while all the vast world that is not yet developed will be led by the People’s Republic of China.
The Second World was made up of the developed countries, but the marginal ones compared to the nations of the First World.
Analyzing President Xi Jinping’s doctrine on Chinese diplomacy more in depth, we realize that these times have already come.
As to the First World, the USA is under crisis, while Russia is now part of the Chinese-led Heartland. The Second World’s countries can all now be part of a bilateral win-win project guaranteed by the new Chinese superpower.
Firstly, China has experienced 40 years of continuous development, i.eafter the Four Modernisations and the subsequent economic and political reforms.
Currently China is the second largest economy in the world and, in 10 years’ time, Chinese analysts reasonably expect it will outperform the United States.
On the other hand, as seen above, there is the progressive expansion of protectionist practices that lead to strong strategic and economic tension between States.
In this case, precisely with his diplomacy doctrine, President Xi Jinping maintains that the domestic choices must always be coordinated with those in the international sphere.
There is no separation – which is eminently non-dialectic – between domestic and international policy in a country.
Again according to President Xi Jinping’s doctrine, at world level the guidelines can only be those of mutual respect for global peace(hence never non-hegemonic) and of mutual development, not only at economic, but also at human level.
It is a Western-rooted humanism, albeit “with Chinese characteristics”, as Chinese would say.
Hence President Xi Jinping’s Diplomacy Doctrine strongly supports multilateralism, both at political and economic and financial levels. It also promotes free trade and facilitatesinvestmentand finally tends to renew and “rejuvenate” the system of global relations as against the US “unilateralism”, which is closely related to protectionism.
Obviously an exporting economy such as China’s, which is however expanding also in the internal market, wants free trade. It is less obvious, however, that a country dominating the world financial system like the United States is linked to the protection of its industries, which are often mature or even decocted.
The primary factor is that, in the idealistic diplomacy resulting from President Xi Jinping’s Thought, what is noted by many Chinese scholars and diplomats is the significant and specific contribution of the country to human civilization – a contribution that, in Chinese leaders’ minds, no other country can currently provide.
It is not a secondary and rhetorical factor: humanism with Chinese characteristics shows that China holds universal values, while the West is ever less globalized in its values and lifestyle.
The China that has expanded throughout the world, in the 40 years since the Four Modernizations, is a primary part of the international community. Its interests have spread across the world, which implies that China has a perspective and a way of assessing facts in a global and not strictly nationalistic way.
Chinese humanism as hegemony of soft power.
Hence, also the West – which is obviously not satisfied with China’s quick, stable and powerful growth – cannot even understand how, according to Chinese analysts, the country can have the perception of its universal commitments and interests.
A Chinese diplomat said that they have been accustomed to be modest, but they have begun to engage deeply in international and global issues, with a view to leading “the reform of globalization” – which is the key to President Xi Jinping’s geopolitics – particularly after the 18thCPC National Congress.
With specific reference to the relations between the USA and China, President Xi Jinping’s theory of Diplomacy maintains that cooperation always achieves win-win objectives, while confrontation always entails a loss for both actors.
According to President Xi Jinping, those who still have a cold war mentality isolate themselves from the world, and those who currently use zero-sum games will never be able to avoid confrontation without suffering great damage.
If the United States creates the conditions for a hard confrontation with China – and powerful enemies emerge – it will reach a condition in which the contrast, even peaceful, will be so hard as to severely undermine the US world rank, as well as its status as first global economy.
As to the relations between China and the Russian Federation, President Xi Jinping regards the two nations as global strategic partners in all areas.
Currently the relations between the two countries are “rock solid” – just to put it in President Xi Jinping’s Doctrine. Together they are becoming a strategically very important force for maintaining peace in the world.
Common Russian-Chinese interests are always expanding, but they never negatively affect a third party and are never influenced by the decisions of a third party.
It is the current Chinese definition of the classic term “independence”. Esoterically, the Void between two Full.
Hence, just to recap, President Xi Jinping’s diplomacy doctrine consists of ten simple points:
a) always supporting the CPC Central Committee’s policy as if it were the essential principle for action, underlining the function of the centralized and unified direction of the Party as far as all relations with foreign countries are concerned.
b) Supporting the development of diplomacy with Chinese characteristics, with a view to fulfilling the mission of national rejuvenation. The internal and external spheres are linked and must never be treated separately.
c) Preserving world peace and reaching a common level of development among peoples and nations, with a view to building a large community, with a shared future for all ankind. Chinese global humanism seen as a Vase of Kingdoms for every national and humanistic tradition.
d) Strengthening all countries’ strategic trust in Socialism with Chinese characteristics.
e) Continuing to work for the Belt and Road Initiative in view of all member countries’ common growth, through discussion and collaboration.
f) Following the path of peaceful development, based on mutual respect and win-win cooperation. Respect, not asymmetrical hegemony, but symmetrical hegemony – in the Chinese view – since it is the result of the political effects of a win-win relationship.
g) Developing global partnerships while proposing a diplomatic agenda.
h) Leading the reform of the global governance system, based on the concepts of justice and fairness – i.e. non-hegemonic concepts of a cultural and political nature.
i) Taking the Chinese national interests as the bottom line for safeguarding China’s sovereignty, security and development interests. It is once again the link between the outside and the inside of the same Vase, namely domestic policy and foreign policy.
j) Nurturing the growth of a specific style of Chinese diplomacy, combining the fine tradition of China’s “external work” with the current needs and characteristics of the international environment. This means to link the Confucian and elitist Chinese tradition with the daily practice of diplomacy.
According to the Party’s current leadership, the study of President Xi Jinping’s diplomacy thought is an essential part of the thought on Socialism “with Chinese characteristics”, so as to achieve a New Era, which is designed to be the start of a global and peaceful diplomacy led by China.
A diplomacy mainly supporting the reform of globalization, the deep core of President Xi Jinping’s diplomacy thought, as well as the global spreading of China’s win-win relations with all the countries of the world.
From this viewpoint, and without ever losing sight of the goal of Chinese national rejuvenation and universal human development – another essential feature of President Xi Jinping’s diplomacy thought – new types of international relations will be established, based on mutual respect, fairness, justice and win-win cooperation. Global multilateralism.
In the future, the diplomacy with Chinese characteristics, introduced by President Xi Jinping, will promote a new international order, resulting from an inclusive world of stable peace, universal security and common prosperity.
This is not propaganda. It is a project that – in the specific terminology of the CPC Central Committee -is building China’s new foreign policy.
Without this kind of political eschatology, we cannot fully understand President Xi Jinping’s thought on international relations.
For a modern, but also for a traditional Chinese, the Confucian metaphysics of principles is what metaphysics was for Aristotle: “the science of ends” – ends which are as real as means.
In fact, Father Matteo Ricci S.J. regardedConfucius as “the Aristotle of the East” and, in the “Rites controversy”, which involved the Jesuit and the Franciscan Fathers, the former supported the sinicizationof the Holy Mass because, despite everything, the Chinese tradition was comparable and consistent with Aristotle’s tradition that had refounded Catholic Metaphysics, through St. Thomas Aquinas.
Moreover, it is a moral and cultural standing proposing itself as a new leadership, in a world of political materialism – especially in the West – and of short-term operational and practical visions.
Hence, there is a successful merging of Marxist analysis and Chinese cultural tradition – a modern cultural and political tradition that is now also ancient.
Therefore, this is another essential point of President Xi Jinping’s Thought on foreign policy.
President Xi Jinping’s diplomacy is an important achievement of the now successful turning of Confucian thought into “Socialism with Chinese characteristics”.
In President Xi Jinping’s mind, arts and culture – which are also essential in the current Chinese power projection – are based on some points that can be taken from various speeches and documents and can be summarized as follows:
1) contemporary art must take patriotism as its primary theme (patriotism and not Marxism),thus leading the crowds to have correct visions of history, nationality, the State and culture. Confirming the integrity and self-confidence of the Chinese people – here lies mass pedagogy, which applies also to foreign policy.
2) Some artists ridicule the sublime (and much could be said in relation to the Western theory of the sublime) and even offend the classics, thus depriving the crowds of heroic figures. The world upside down, the good as the bad, the evil becoming good, the ugly becoming beautiful. Here President Xi Jinping, who knows the European culture well, will certainly remember a scene of the tragedy that built the Western culture: the ritual of the Three Witches around the cauldron in Shakespeare’s Macbeth.
3) The market value of arts is completely irrelevant, compared to their social value. Another problem of pedagogy in arts, while the West tends to exclude the public from the works of art and is scandalized – following Walter Benjamin -by their technical reproducibility. The economic benefits are always worth less than social ones – and this is another very important factor to understand President Xi Jinping’s thought. Nevertheless, the independence of arts and the autonomy of their aesthetic value is indisputable. Autonomy, not exclusion from the public.
4) Chinese art must never chase the foreigner. Provincialism is the absolute evil. We cannot say President Jinping is wrong.
5) Providing sound, healthy and progressive content to mass fashions coming from abroad.
In essence, it is a transposition – within the arts – of the same principles that President Xi Jinping has developed for the art of diplomacysince last June.
In other words, the values of all behaviours;the universal effect of behaviours; the union between the private and the public sphere, i.e. between the external (foreign policy) and internal domains (national life).
The Chinese still view diplomacy as an art, unlike the West, which now regards its diplomats as sellers of goods and services, as financial promoters or advisors, and possibly as brokers of contracts.
This will never be the diplomacy of a prestigious, influential and successful country.
The New Chinese Diplomacy, however, also concerns President Xi Jinping’s attempt to capitalize on Donald J. Trump’s isolation on the world scene.
So far, however, only 19% of the citizens in 25 Western countries like China as world leader, while a US Rule is still acceptable to 25% of the world public.
Not even the US results, however, are very brilliant.
After all, President Jinping’s goal is to make China rapidly becoming a global superpower, thus creating a protective network of allied countries, with a view to counterbalancing the equivalent US structure of international relations. Once again the Void and the Full exchanging their roles.
In fact, one of the reasons underlying the Belt and Road Initiative is to create a network of long-term allies for China, capable of covering at least the whole Eurasian Heartland, thus blocking it in the face of the US power expansion.
Once again the Void and the Full, two terms of the Chinese esoteric tradition: the Full will be China’s and the Russian Federation’s undisputed power over the entire Eurasian Heartland, with ramifications towards an increasingly weaker Eurasian peninsula in geopolitical and military terms.
The Void will be the US strategic autonomy around China – at least for the time being.
There may also be a structural Chinese contrast with India, a future great power, also at economic level, but to the south, at the crossroads between the Heartland and the great line of communication between the Asian Seas and the Persian Gulf, and finally the Mediterranean.
For the time being, the EU irrelevance will suffice. An unbeatable guarantee for both the USA and the other major global players.
The void, more important than the full, is currently the still decisive US presence in the primary and secondary seas, with little penetration into Africa, very strong US presence in Europe and the North American management of the break between Eastern Europe and Russia, which is capable of making the Heartland open and “viable” and depriving it of strategic value.
This is the great picture in which President Jinping’s Diplomacy Doctrine shall be seen.
Hence, we are still in the phase of the speech delivered by President Jinping to the CPC Central Committee in 2017, when he said that “China would stand tall and strong in the East”.
In a phase of globalization crisis, we are still reinterpreting the theme of China’s “central interests” – an issue that had been discussed by the Chinese leaders, especially in the early 2000s.
On the basis, however, of the “great rejuvenation of the Chinese nation” and of the “Chinese dream”, two essential themes of the 18th CPC Congress that crowned Xi Jinping as leader.
The President has quickly become China’s “central leader”, especially through the great campaign against corruption.
At international level, Jinping’s Presidency differs greatly from an essential strategic theme of contemporary China: the low profile imposed, at the beginning, by Deng Xiaoping.
Deng seemed to think that China should be allowed to build a modern economy, which was its first and fundamental objective, but should not be bothered with the major geopolitical and military issues, which were still out of reach and diverting the country from its primary objective.
President Jinping has instead overturned this principle: China certainly has world ambitions, which are also its primary interests.
Hence China’s core interests are well known: the establishment of the Asian Infrastructure Investment Bank;the One Belt, One RoadInitiative; the construction of artificial islands in the Sea of Japan; the building of the Djibouti base and the silent participation in many world conflicts and tensions. These are all ways to further China’s global power and protect its primary interests.
We should also recall “China 2025” and “Amazing China”, two projects that are far from negligible in this new Chinese plan that consists in regulating, reforming and even regaining globalization, while other countries, such as the USA, temporarily recreate their economy and their labor force returning to protectionism. Inevitably, this will always recoil on them.
Protectionism is a drug with short-term effects.
The alternative option is twofold: to continue the game of globalization – which has now almost completely deindustrialized the nations that began the Industrial Revolution of the 19th century – or to temporarily strengthen the country with protectionism.
On the one hand, however, China can afford globalization because it has a different productive formula but, on the other, it could play even the game of protectionism, using the belt of the Silk Road countries, which can easily maintain and absorb an acceptable level of Chinese exports, even under the terms and conditions set by China.
Hence, are we now faced with a new cold war, the one between China and the West?
Probably, but only a Third Type one, with an economic war characterized by Second Type skirmishes, halfway between the symbolic and the strictly military domains.
China has already tried to close operations with an alliance between it and the EU, Russia and Japan.
Nevertheless, considering the current configuration of world trade, the attitude has been lukewarm.
The USA has instead reactivated part of its trade with the EU, by greatly strengthening its historic relationship with Japan.
Hence, there is once again the spectre of China’s closure within its traditional borders – a danger that President Xi Jinping wants to avert ab ovo.
As early as 2009, China’s “central interests” were theorized in the Central Committee as: 1) China’s fundamental system and State security; 2) the State sovereignty and territorial integrity; 3) the stable development of the economy and society.
The 2011 White Paper added “peaceful development” and “national reunification” to these fundamental policy lines.
That is the one with Taiwan.
Currently China makes it increasingly clear that respect for its core interests is essential to create the win-win relations that characterize its bilateral economic relations.
This is one of the primary aims of President Xi Jinping’s Diplomacy Doctrine.
Moreover, China, is no longer encouraging Chinese companies’ investment abroad, thus reuniting all what was previously scattered everywhere in the sole Belt and RoadInitiative, which is currently part of the Constitution and the Party’s Basic Policy Line.
The Belt and Road Line was born from that of the “March to the West”, a strategy initially developed by the international policy expert Wang Jisi, who believed China had to go towards Central Asia and the Middle East, with a view to minimizing the tensions with the United States in East Asia.
An essential area for the United States.
Currently, however, the “Belt and Road” initiative is a global and not a regional initiative – as Wang Jisiinitially thought – a project that will lead to geopolitical upheavals not yet predictable.
The project stems from two essential needs: China’s exit from its unsafe traditional borders and the continuous, stable internal economic development that, where lacking, would put the power of the Party and the State to a hard test.
These are the economic and political mechanisms that President Xi Jinping’s Diplomacy Theory wants to expand and protect.
The complex puzzle of Canberra-Beijing ties, as diplomacy takes a back seat
Australia and China seems to be engaged in a repulsive tariff war targeting each other’s goods. Canberra is struggling to manage its complex economic relationship with Beijing even as it finds itself in the strategically opposite camp. How did things turn out this way? Here, I analyse.
There was a time when Australia under the Mandarin-speaking Prime Minister Kevin Rudd, who was in office from 2007 to 2013, had the highest level of warmth in relations with China.
The Labour premier saw a promising prospect of economic partnership with a rising China at that point of time, but gravely under-estimated the geopolitical threat that would be soon posed by Beijing, a mistake later governments would realise and is still striving to rectify.
Quad pullout and comeback
Rudd even pulled Australia out of the four-nation Quad grouping in 2008, a year after it was conceived by former Japanese PM Shinzo Abe, in a move to appease Beijing with which Canberra’s economic partnership was progressively moving upwards. But, nine years later, Malcolm Turnbull’s premiership brought Canberra back to the Quad as regional and global security dynamics witnessed a paradigm shift.
A decade later since Rudd took office, despite closer economic ties with Beijing, Canberra pushed for a closer alliance with the United States since 2017, the year Quad Security Dialogue was revived during the ASEAN and Related Summits in Manila.
It was a result of changes in security assessments by Canberra with regard to new threats and challenges from an increasingly assertive Beijing in the Indo-Pacific and beyond.
The rift between Australia and China further widened, earlier this year, when the Australian government supported an inquiry into the origins of the novel coronavirus, annoying China where it originated. Australian politicians also became increasingly divided on hawkish and dovish lines.
Huawei and ZTE ban
Tides were turned in 2018 when Australia became the first country in the world to ban Chinese telecom giants Huawei and ZTE from 5G trials and rollout, citing security concerns, as these companies ‘allegedly’ had links to the Chinese ruling establishment which they deny.
Beijing also reciprocated with tit-for-tat measures from time to time. The latest in line of such measures was the imposition of temporary anti-dumping tariffs up to 212.1 per cent on Australian wine imports with effect from November 28, this year.
Ongoing tariff tensions
2020 saw a foray of imposition of tariffs and reciprocal duties from both sides right from the beginning of the pandemic. Attempted mergers and acquisitions by Chinese companies involving companies in Australia were also blocked by Canberra citing security reasons.
Adding oil to the fire, anti-dumping investigations were initiated by both sides against each other, for using its findings as rationale for imposing more tariffs on different sets of goods such as aluminum, steel, paper, coal, copper, sugar, log timber, and barley.
What will be the fate of the 2015-signed China-Australia Free Trade Agreement (ChAFTA)?
The worsening ties might take a toll on ChAFTA as it readies for a five-year review next month, notwithstanding the other broad-based trade pacts in which both countries are participants such as the recently-signed, 15-nation Regional Comprehensive Economic Partnership (RCEP).
ChAFTA took about a decade to complete and led to zero tariffs on many goods, but RCEP is still in its infancy.The main issue is not whether a review of ChAFTA is possible, but how to prevent the looming prospect of Canberra and Beijing retreating from the current commitments directly or indirectly that would effectively reduce the pact into a state of coma.
As ChAFTA goes for review in December, the most likely outcome could be both countries agreeing to maintain the deal’s status quo. If any of the parties wishes to terminate the pact, there is a six-month notice period after which they can leave, with or without a review.
Still economic partners, but political rivals
Today, China has positioned itself as Australia’s largest trading partner. Moreover, Australia strongly benefits from its close proximity to the vast markets of China and Japan which together represent over 40% of all Australian exports, in which a little over 32% amounting to $89.2 billion, are exclusively to China, as data from 2019 show. Despite this, Canberra and Beijing remain at odds politically.
Exercise Malabar 2020 and beyond
One of the striking questions in the strategic circles of all Quad partner countries is, will Australia continue to take part in the annual Exercise Malabar in the coming years, annoying Beijing further?
While Japan is a strategic partner in the Quad, ties with China are moving on an adversarial path, particularly worsening since Canberra took part in the annual Exercise Malabar in the Indian Ocean this month, after a gap of 13 years since it left the mega naval war games.
The exercise by the four Quad partners of India, United States, Japan, and Australia is apparently a warning to Beijing’s naval ambitions in the waters of the Indo-Pacific.
Supply Chain Resilience Initiative
In fact, all the Quad partners and other democracies in the Indo-Pacific wish to decouple itself from over trade dependency on China. But, domestic economic realities prove otherwise. With a raging pandemic and the unravelling US-China cold war threatening supply chains, Japan has recently put forward an idea – the Supply Chain Resilience Initiative or SCRI.
It is a trilateral approach to trade, with India, Australia, and Japan as the key-partners aimed at diversifying its supply risk across a group of supplying nations instead of being disproportionately dependent on just one, apparently keeping China in mind.
Despite all these measures, the prospect of closing of huge Chinese markets for Australian exports, owing to a disproportionately high level of tariffs is haunting domestic producers in Australia that could potentially make Australian wine largely unmarketable and non-feasible in Chinese markets.
Ineffective diplomatic efforts
Current Australian PM Scott Morrison has been trying to bridge gaps in a reconciliatory tone by stating that his government’s actions are wrongly seen and interpreted by some only through the lens of the strategic competition between China and the US. But, Beijing doesn’t seem satisfied, as evident in the decision to impose the recent set of disproportionate tariffs on wine.
Loss of businesses for Australian domestic producers is already hurting the Australian economy badly as goods remain stalled at ports. But, the behemoth of Chinese economy appears to be largely resilient to adverse impacts, compared to the Australian economy.
Australia’s producers and farmers are largely unhappy and unsatisfied with the way Canberra is dealing with Beijing as it directly threatens their livelihoods.
As things turn out worse, Canberra will have to strategise newer options to effectively balance geostrategic and economic considerations with regard to Beijing, possibly through the diplomatic route, in a way to immediately diffuse the prevalent confrontational approach to come out of this diplomatic impasse.
Is China on the brink of a food crisis?
It is not a secret that the current COVID-19 pandemic has been affecting people all around the globe. The virus touched almost all spheres of regular life – i.e. it resulted in temporary or permanent closure of businesses, a rise in the unemployment rate, inability to physically spend time with family and friends. Such drastic changes in times of uncertainty significantly impacted the well-being of the world population. Moreover, Food and Agriculture Organization of the United Nations (FAO) warned about the emerging food shortages worldwide. According to FAO statistics, global food prices have been on the rise for four consequent months, hitting their maximum in September 2020. China – the place where the virus originated – is one of the states that have been seriously affected by the disruptions, including production and distribution of food.
In his speech on August, 11 Chinese leader Xi Jinping did not admit any food shortages. However, he promoted food security through the campaign “operation empty plate,” thereby encouraging people to stop wasting food. It is interesting to note that Mao Zedong introduced a similar food campaign before the 1959 Great Chinese Famine. Meanwhile, there has undoubtedly been a significant increase in food prices in China. Many experts claim that China is on the brink of a food crisis that has been manifested as a result of lockdowns, infected livestock, and poor weather conditions. It is difficult to give any predictions or estimations about the future food situation in China because the country does not share enough of its data with the rest of the world, yet it is possible to answer the question why the state faces food difficulties.
Average food prices increase
The National Bureau of Statistics of China reported that, on average, food prices have increased by 11.2% compared to 2019. The price level of vegetables increased by 6.4% in one month; egg prices soared by 11.3% within the same period. Pork prices grew the most, by 52.6% compared to the last year’s statistics. Why is it important?
Firstly, many workers and their families who faced loss or decrease of income or remittances became food insecure. That, in turn, has had social repercussions for the overall level of crime, health concerns among adults and infants, high death rate, different demographic and economic challenges. Furthermore, international trade will also suffer: due to the lack of labor force Chinese imports in foreign countries will seemingly increase in price.
Secondly, China, along with other countries, was in a period of recession earlier this year. Food insecurity will cause difficulties in coming out of this financial downturn.
The impact of lockdowns on food supply chains
One of the main factors contributing to the declining agricultural productivity and spiking food prices in China is the restrictions on personal mobility and transportation of goods. In January Chinese authorities adopted measures to limit mobility within the country; they imposed “city lockdowns, traffic control, and closed management of villages and communities.” Such restrictions impacted food supply chains. For the production part many workers experienced difficulties getting to work that created a shortage of physical labor. That is why some crops were not picked, others were not even planted. As a result, the supply of agricultural goods decreased. On the other hand, at the beginning of the year, the demand for them also fell as restaurants and bars were closed. Thereby, many crops went to waste, while farmers did not make enough profit to purchase the seeds and fertilizers for the next season. It is a problem because businesses continue to open up, raising the demand and prices on crops. Immobility also impacted the distribution of seeds and fertilizers to the farms that disrupted the plantation season. Furthermore, the distribution of agricultural goods to grocery stores became difficult. Particular inconveniences associated with the restrictions on mobility all added up to the spike of prices on crops.
African Swine fever outbreak
Another factor impacting the emerging food crisis in China is the failure to rebuild last year’s loss of pigs due to the infection. Chinese porcine farms were hit by the African swine fever outbreak that infected and killed a large number of pigs (40% of total Chinese pigs’ population), decreasing the supply but increasing the prices on pork in 2019. According to China’s National Bureau of Statistics, pork prices were 52.6% higher in August this year than the year before, while corn prices – the main porcine fodder – increased by 20% compared to last year. Chinese farmers failed to improve the situation in 2020 due to severe flooding. The increased amount of precipitation caused considerable losses of corn and thus the inability to feed pigs. China began to import crops from abroad – particularly, corn from the US. As the United States Department of Agriculture (USDA) stated, China had been importing 195,000 more tonnes of American corn than the year before.
Shuttered diplomatic relations between China and Western states
Some experts claim that Chinese diplomatic relations with such Western countries as Australia, the US and Canada shattered due to the fire of four ballistic missiles on the Indian border on August, 26. These states are China’s major food exporters. If their diplomatic relations with Beijing worsen, then the trade has a high chance of being negatively affected as well. In other words, Chinese imports of crops have the risk of becoming more expensive, meaning that the prices of pork and other goods might rise even more.
Severe flooding and drought
Finally, worsened weather conditions – some parts of China experienced drought, others were hit by flooding – led to a decrease in crops and a significant increase in food prices. Southern, Central and Eastern China underwent a period of heavy rain and the worst flooding in the last hundred years. Excessively high water levels in major Chinese rivers, including the Yangtze River, resulted in the evacuation of 15 million people in July 2020. Moreover, the flooding destroyed 13 million acres of agricultural land, which is estimated to cost at least $29 billion of economic damage. In the meantime Northern (Xinjiang province) and Southwest (Yunnan province) China have gone through a period of severe drought. In April 2020 nearly 1.5 million people in Yunnan province were caught in an emergency situation: shortages of drinking water, damage of hundreds of hectares of crops and livestock. Consequently, the supply of many agricultural goods and pork decreased, which spiked the prices on these goods.
Chinese long-term prospects toward food security
To conclude, immobility, African swine flu, worsened weather and security conditions led to the growing food shortages and increasing food prices in China. This being said, the Chinese government has been working on that problem. It has taken special measures to ensure sufficience of agricultural goods by investing in various disaster relief funds for different crops, particularly rice and wheat. For example, Chinese authorities allocated 1.4 billion yuan to save the agricultural harvest in Hubei province. Due to the substantial loss of agricultural products, China has also increased its imports. General Administration of Customs reported that China’s grain imports rose by 22.7% in July 2020 compared to the previous year. Meanwhile, the Chinese leader took a gentle approach to solve this problem. He did not announce the issues related to the insufficient number of crops; instead, he adopted a program for encouraging people to be more frugal with their eating habits. The Chinese Academy of Social Sciences followed the same path as it denied anticipation of a food crisis in the short-term perspective, yet warned about possible food shortfalls by 2025 if no agricultural reforms take place. As of now, China is not on the break of a food crisis; however, its shuttered prospects for long-term food sustainability are subject to dangerous repercussions.
From our partner RIAC
China and Mongolia: A Comprehensive and Never-Ending Strategic Partnership
Mongolia is an exceptional country when it comes to Eurasian geopolitics, linking China with Russia, two great countries in terms of military and economic capabilities, geographical area and population. In June 2016, the China-Mongolia-Russia Economic Corridor (CMREC) was announced in order to consolidate friendly relations and promote economic exchanges for the success of the Belt and Road Initiative. Many reports indicate the great position of Mongolia on the Chinese economic map as a pillar of the modern Chinese initiative. Mongolia is a major economic partner of China, and the Chinese administration aspires to forge permanent relations of cooperation and coordination with Mongolia by virtue of its common geography and strategic location, in order to open up through it to Russia and other Mongolia is a key economic partner of China, and the Chinese administration aspires to forge permanent relations of cooperation and coordination with Mongolia by virtue of its common geography and strategic location, in order to open up through it to Russia and other international partners.
Mongolia is rich in natural resources, for example the mining industry provided up to 30% of GDP and almost 90% of exports, but its economy is not as developed compared to China. Some economic reports indicate the great economic benefit to Mongolia from the China-Mongolia-Russia Economic Corridor. Mongolia is expected to witness unparalleled economic growth in terms of international economic cooperation, which will positively affect the national economy. The Mongolian economy depends heavily on China’s investment; data of the two largest ports in Inner Mongolia Autonomous Region in northern China indicates enormous economic benefits. In the chart below, the continued economic progress achieved in Inner Mongolia is shown. In addition, rail trade increased by 16 percent year-on-year to 11.2 million tons in 2017. In the same year, 570 trips were made on the China-Europe railways passing through Ernhot (a county-level city of the XilinGol League, in Inner Mongolia Autonomous Region, located in the Gobi Desert along the Sino-Mongolian border, across from the Mongolian town of Zamyn-Üüd).
The Belt and Road Initiative aims for mutual profit, cooperation and peaceful communication. China shares an ancient cultural history with Mongolia, long common borders, and economic cooperation that has never stopped. The strategic geographic location of Mongolia makes it a priority for China on the new Silk Road, in addition to the richness of natural resources and livestock that China needs.
The Mongolians are a horse-loving people, a country known for its large number of horses. Mongols without horses are like birds without wings. Despite globalization and the great economic progress in the neighbor (China), as well as the cold weather and difficult geography, the Mongolians did not abandon their traditions and the Mongolian way of life still exists today. In Mongolia there are herders of horses, camels and cattle to benefit from milk, meat, wool, etc. During the pandemic in China, for example, President Battulga set up what is known as “Sheep Diplomacy” where Mongolian President donated 30,000 sheep to China. This initiative indicates the Mongolians’ positive intentions towards the Chinese and the desire to open up more. In this context, I would like to point out that China is a big importer of meat and the Chinese demand for meat is constantly increasing, as shown in the chart below. Here is a great opportunity for Mongolia to increase its exports of meat to the Chinese market.
The reading of Mongolian history indicates that this country has passed through periods of prosperity. Mongolia may be a good example of power and rule, as its borders extended to many countries during the rule of Genghis Khan (1162-1227), the man whom the Mongolians consider their historical leader and has turned into a hero and a national symbol. The Mongolians did not abandon their land despite the cold weather and difficult geography, indicating that they are a deeply rooted people with land. Mongolia, with its vast territories and few people, has turned into a meeting place for Russia and China, and a strategic center for Chinese economic expansion. Therefore, it is impossible for the Chinese administration to abandon the partnership with Mongolia.
The Mongolian economy is heavily dependent on livestock, and the number of pastures has increased significantly since the Soviet era because of the transfer of ownership to the people. However, the government is still not able to provide all services to citizens “the government has failed to promote education and health care and veterinary care in pastoral communities, so there is no longer any incentive to stay in rural areas” said Sarol Khuadu, an official at the Institute for Environmental Research in the Mongolian capital. The policy, which no longer places much emphasis on the countryside, has led to the transfer of large numbers of citizens to the capital and to engage in the world of money and business.
Unfortunately, the Mongolian government is not working seriously to support citizens in remote areas. The conditions of life are not good and the loans granted are high interest, in addition to the weather that adversely affects their businesses. In order to help the poor and rural people, in cooperation with national governments, humanitarian, development and scientific partners, FAO has developed an early warning approach by monitoring risk information systems and turning warnings into proactive actions. International organizations contribute to permanent humanitarian and social assistance in Mongolia.
Mongolia’s strategic policy through the “Mongolia Steppe Road Program 蒙古国“草原之路” is largely in line with the belt and road initiative, which is a road connecting Mongolia, China and Russia. Consequently, Mongolia, a country that mainly depends on the agricultural sector, will be a center for economic communication between China and Russia, and thus will witness a great economic development. The Steppe Road Program aims to boost Mongolia’s economic standing and create an advanced network of infrastructure for communication with China and Russia and build an oil and gas pipeline. In 2014, during his historic visit, Chinese President Xi Jinping raised the level of relations between the two countries to “Comprehensive Strategic Partnership Relations”. Since then, bilateral cooperation has begun to move faster.
China has never abandoned Mongolia; it is a country of advanced strategic location as a bridge between Asia and Europe, in addition to the important agricultural sector in Mongolia which benefits China greatly, not to forget to mention the China-Mongolia-Russia Economic Corridor which has become an important part of the belt and road initiative and a key component of Sino-Russian cooperation.
The relationship between China and Mongolia today is an ideal example of the bilateral relationship between two neighboring countries. Cultural, economic, political and tourism communication is in continuous progress between the Chinese and Mongolians, and the Belt and Road Initiative will push this communication forward. The Chinese aspire to increase free trade areas and economic connectivity through a developed infrastructure network.
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