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China and Hong Kong

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The real crucial event in China’s current policy, not only for Hong Kong, was the document on “State Security in the Hong Kong Territory”, voted in the recent National People’s Congress at the end of May.

 The document drafted by the National People’s Congress regards above all the Chinese national security and hence the internal security of the Fragrant Harbour, as well as the direct control of the strategic and public security situation of the anti-Chinese political opposition in Hong Kong, and, in particular, the reform of Article 23 of the Basic Law which governs the former British colony.

It should be recalled that two Opium Wars started from there only against mainland China. The opium was cultivated by the British East India Company in its territories in Bengal.

From 1839 to 1842 and from 1856 to 1860, as many as two trade and military conflicts allowed the actual British monopoly of the British and Indian opium throughout the Chinese territory.

Let us revert, however, to Article 23 of the Basic Law, which formally prohibits any act of treason, secession, sedition and subversion against the State of the People’s Republic of China, as well as the theft of State secrets.

Therefore, the Chinese government now acts autonomously, in the territory of Hong Kong, for the defence of its interests. This also paves the way for a wide geopolitical transformation, in some ways more “radical” than the one which Deng Xiaoping carried out in 1978 with the Four Modernizations. It should be recalled that they ended with the most important Modernization for China, namely the military one.

The first attempt to adopt national security legislation in Hong Kong was made as early as 2003, when at least half a million people demonstrated against said legislation – very similar to the present one – proposed and established by China. Later there were several other security bills and, again, other large mass demonstrations.

 Until the demonstrations of April 2019 against the Chinese bill to stop the extradition of PRC’s citizens to the Fragrant Harbour.

At the time demonstrators shouted “Liberate Hong Kong, revolution of our times”.

Certainly China has often stated it sees Hong Kong’ security severely affected by the operations of various and unspecified “powers”, which (undoubtedly) use Hong Kong to penetrate China and later possibly carry out separatist operations (Uyghurs, Tibetans and other riotous and unruly minorities),as well as infiltrations – sometimes military ones – and finally what China calls “harmful operations”.

 Certainly these “harmful” operations also include those by Europe and the United States, which already repeatedly urge many “partners” and companies of the Global Value Chains (GVC) already present in China to move to the small territory of the Fragrant Harbour. This is also an objective cause of the improbable request for an “independent” investigation on the causes of the outbreak and spreading of the Covid-19 pandemic from the Chinese laboratories of Wuhan, Hebei.

A real attack on global economic development, and on China’s economic security, right now that China is quickly transforming its production formula.

China wants to thwart such a move by bringing many production chains directly back into its territory, and by increasing the Chinese strategic (and hence financial and economic) pressure on the U.S. traditional allies in South-East Asia and the Pacific.

 Not necessarily the Southern Pacific only.

However, we will come back also to this point. As can be easily guessed, for China this is a strong point for the direct control of the Fragrant Harbour’s territory.

 However, a historical and ancient condition is no longer in place, i.e. the separation of Hong Kong’s legislation from Great Britain’s and currently China’s.

Obviously the Chinese decision is also a clear heave-ho given to Governor Carrie Lam and to the entire government in Hong Kong, by-passed in a few hours by the very clear Chinese diktat.

China has probably calculated the pros and cons of this move very well.

The cons, which are not insurmountable, include the reduced importance attached to Hong Kong as the only financial and industrial hub in the Chinese territory, which is also fully Westernized and globalized. This also greatly serves the PRC’s direct interests.

 The U.S. interests in the Fragrant Harbour will no longer be safe and this is not a negligible issue: 1,300 medium-large North American companies and 82.5 trillion U.S. dollars in direct investment.

Not to mention the dozens of NGOs that support democratization in Hong Kong against China and the many large global media headquarters in Hong Kong, as well the several operations of infiltration, intoxication and information manipulation (including some financial and industrial ones) that the West has carried out against the People’s Republic of China, starting from the Fragrant Harbour.

 From now on, for the whole West, Hong Kong’s gateway will be closed with seven seals.

Certainly, when the People’s Republic of China feels threatened, it always sacrifices the economy to global strategy.

Certainly Hong Kong has always been China’s financial lifeline, especially in difficult times.

Currently, however, Hong Kong is an irreplaceable global financial hub in Asia. Nevertheless, I imagine that China will soon want to use other less dangerous and, above all, less close channels to connect to global finance.

 Moreover, for the first time since 1992 – and, probably since 1978, the year of the Four Modernizations, if we analyse older time series – the Chinese economy is slowing down considerably due to the outbreak of the Covid-19 pandemic, although with less severe damage than in the United States and in some E.U. countries.

The PRC’s first objective was to resume economic and industrial activities in full swing, while the second one was to make the Fragrant Harbour safe.

 But, once again, there is a pro versus a con: while Hong Kong and, for other respects, Macao and Singapore, have been the destination areas of huge amounts of capital resulting from the corruption and embezzlement of many Chinese elites, Hong Kong’s closure will probably also mark the end of the great hunt that President Xi Jinping and his power group have focused on corruption within the Party and Beijing State.

The old strategy of “Power putting down roots”, as recommended in The Prince by Machiavelli.

Hence President Xi Jinping wants to directly control the Fragrant Harbour, the original site of China’s forced Westernization, from the beginning of the “century of humiliation” (precisely with the first Opium War) to its end, with the PRC’s declaration of independence by Mao Zedong – “the Chinese people have stood up!” -at the Gate of Heavenly Peace Square, in 1949.

The countries that are bound to win in the world arena are those with long and very long memories, while the post-modern and childish forgetful ones are always bound to lose.

Obviously – as was also seen in the very recent National People’s Congress in Beijing – Hong Kong is also a powerful sign for regaining Taiwan politically and economically.

Recently, China has announced a 6.6% increase in the Defence budget from 1.72 trillion yuan (187 billion U.S. dollars) and Li Kekiang, Beijing’s Premier, has made it clear that “China resolutely opposes and will deter any separatist activity seeking Taiwan’s independence”.

 Normally, the Chinese authorities speak of “peaceful reunification”, but this time Li Kekiang omitted the adjective. It was not a distraction.

 In Mao Zedong’s time, the always synthetic and enlightening formula of the Chinese leadership was available for Hong Kong: “long-term planning, full use”. Later the “one country, two systems” formula initially developed by Deng Xiaoping was used, later reaffirmed by the various leaders and so far supported by President Xi Jinping himself.

This Chinese choice on the Hong Kong Security Law, therefore, means only one thing: the end of the old Cold War between the West and the PRC, and hence the beginning of a new phase between China and the United States, which will be “hot” or “cold” depending on the circumstances. Therefore, China has no need in the future – not even financially – to have Hong Kong as a buffer zone with a relatively peaceful, but always radically adverse West.

 Both the USSR and Mao Zedong’s China have always regarded the “Cold War” as an unstable phase in which victory is decided by the amount of arsenals, their doctrine of use and the political will to use them as instruments of credible pressure.

Certainly, Mao knew all too well – and it was one of his most enlightening strategic insights – that the “Cold War” was a paper tiger and those who believed in it could only consume themselves, politically and economically, against the United States and its allies – something that punctually happened with the USSR, which collapsed because it had not renounced in time to a clash impossible to win and which, at most, would give it the “great European plain”, as Hegel and Raymond Aron called it.

Hence China quickly closed its accounts with the Fragrant Harbour, pending the closing of the subsequent operations also with Taiwan and all the other controversial areas, from the Philippines to the South China Sea, from South-East Asia to Malaysia and the Indian Ocean.

The old map – born with Kuomintang, but which was also very popular among Chinese Communist leaders in the 1950s, in which the new Chinese territorial waters beyond the Philippines’ line and throughout the Eastern Pacific could be seen -has not been forgotten at all.

 The United States has obviously “condemned” the Chinese decision, while Great Britain, Australia and Canada have signed a common document expressing “deep dismay” at China’s decision.

Furthermore, the United States already has the Hong Kong Human Rights and Democracy Actof 2019 available – pending the great demonstrations which characterized that year and are currently collectively called the Water Revolution.

 Therefore, by virtue of that Act, the United States could remove the preferential trade status of Hong Kong, possibly with the extension to Hong Kong of the tariff and trade sanctions already in place against China. It should be recalled that these restrictions are worth67 billion U.S. dollars per year.

Hence China’s goals for its actual regaining of the Fragrant Harbour are manifold and complex. Firstly, there is the closure of the financial closed circuit between China and Hong Kong, to be put into effect with the minimum international reaction. Secondly, there is also China’s need to rebuild the central and decisive position of the Chinese economy in the Global Value Chains – a position which, even before the “taking” of Hong Kong, had diminished in importance, but which would currently be fatal, especially if it arrived as a result of the Covid-19 pandemic.

Obviously China also regards Hong Kong as a strategic, unavoidable and essential location for controlling the South China Sea militarily. The Chinese always reason with what De Gaulle called the “two caps”, i.e. the civilian and the military one, which must always be kept together.

 Certainly, the peaceful regaining of Hong Kong is also a breaking point of the current U.S. geopolitics in the region: from the Far East probably to the Middle East, the United States has always thought of a long strategic-military continuity that would encircle Russia and close China in its hardly controllable terrestrial mainland.

Hence China’s full control of regional seas will no longer enable the Russian Federation to depart from the project hegemonised by China, the New Silk Road, while the “small silk road” already planned by Russia, mainly with Japanese but also U.S. capital, will be either integrated into the Chinese one or destroyed.

Finally, as already mentioned, China wants to speed up the process to separate Taiwan from the Japanese and North-American military “umbrella” protecting it.

Here we need to carefully examine the relationship between “Xi Jinping’s policy line” and the 1998 theory of unrestricted warfare.

China, which is aware of not yet being clearly superior in terms of “conventional” or traditional warfare, even if technologically advanced, must absolutely win its total war, its new unrestricted warfare.

Hence another reversal of the Cold War theorem: while, during the whole conventional phase of the Cold War, China depended on Russia for military technology, currently it is Russia that depends on China for orders and financing-purchases – although with its own often excellent and innovative war technology.

Hence if China, which has also acquired – both legally and in other ways – excellent Western, and not only post-Soviet military technology, wants to wage war – even regionally and indirectly –  against the United States, it must necessarily do so in time, before the United States rising up to China’s technological-doctrinal challenge, with the weapons it would like to have and has not yet, instead of those it already has.

Furthermore a war game conducted by the RAND Corporation in early March 2020, demonstrated that, in an armed conflict, the United States would lose both against China and the Russian Federation, obviously considered separately.

As also the U.S. analysts maintain, on the neo-technological – and hence also doctrinal level – the United States lags behind China with regard to strategic and missile precision weapons, hypersonic systems and guidance systems for all theatre ballistic weapons. While the United States is still superior in tactical weapons and in conventional medium-high technology weapons.

 The United States, too, has suffered the conceptual impasse of the “Cold War”.

Also the F35 missile could be an excellent weapon for air supremacy, but – as a U.S. analyst said – it could be bombed to the ground by China or Russia.

 Other always accurate and updated war games, conducted by U.S. analysts, show that the United States would be clearly defeated even in the South Pacific, or by Russia in the Baltic, but certainly China would win in a regional clash to take Taiwan, while both Russia and China are working on the new anti-access/denial area weapons (A2A) quite successfully.

 Meanwhile, President Xi Jinping has shifted his strategic interest from the ground forces of the People’s Liberation Army (PLA) to the PLA’s Navy and then to the Air Force, but especially to the Strategic Missile Force and the more recent Strategic Support Force.

Today there is still a window of opportunity, which will last until the end of 2020, so that China can neutralize the U.S. fleet more than a hundred nautical miles from its coast and from the coast of Hong Kong, Macao and Singapore, as well as neutralize the U.S. missile systems both in Guam and Japan and in the small islands of the South Pacific.

Here is the strategic pendant of China’s choice on Hong Kong’s internal security.

Taiwan could also be the operation that makes the war escalate up to its nuclear level, but it is not said that the Chinese supremacy, still viable in a clash with the United States, decides to get to that point, although, probably, it will strike first and, hence, harder. But it will try to stop operations before the U.S. decision to go for the nuclear blow.

 Nor should we forget the regional war that China waged with India precisely in May 2020, in the area of Lake Pangong Tso and the Galwan Valley, with a quick peace negotiation for controlling Ladakh, a border area still disputed by China, as well as an always very fast operation of the Chinese Forces in the north of Sikkim, again at the beginning of May 2020.

We do not know yet whether all future Chinese operations will be lightning ones.

Hence we need to place the Hong Kong issue within this line of thinking.

Advisory Board Co-chair Honoris Causa Professor Giancarlo Elia Valori is an eminent Italian economist and businessman. He holds prestigious academic distinctions and national orders. Mr. Valori has lectured on international affairs and economics at the world’s leading universities such as Peking University, the Hebrew University of Jerusalem and the Yeshiva University in New York. He currently chairs “International World Group”, he is also the honorary president of Huawei Italy, economic adviser to the Chinese giant HNA Group. In 1992 he was appointed Officier de la Légion d’Honneur de la République Francaise, with this motivation: “A man who can see across borders to understand the world” and in 2002 he received the title “Honorable” of the Académie des Sciences de l’Institut de France. “

East Asia

The Taliban seek cooperation with China?

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image source: chinamission.be

How to deal with Afghanistan after the removal of US forces has become a subject that many countries are grappling with. And because Afghanistan and China are linked through Xinjiang, the Afghan Taliban aspire to cooperate with China. According to sources, on July 28, Baradar, the head of the Taliban’s Political Committee, visited China and met with Foreign Minister Wang Yi.

During the meetings, Foreign Minister Wang Yi made a personal plea to the Taliban in Afghanistan, expecting that the Taliban would draw a line with terrorist organizations like the East Iraqi Movement and actively battle them, removing barriers to regional growth and cooperation. Since the United States made it apparent that it intends to withdraw its troops, China’s position toward Afghanistan and the Taliban has become the center of all countries’ attention.

Prior to that, China simply repeated its long-standing foreign policy of non-interference in domestic matters, — in other words, China does not intervene in Afghanistan’s internal problems and expects Afghans to handle their own internal affairs. China, on the other hand, is very concerned about the situation in Afghanistan. China has not only made substantial investments in Afghanistan, but it has also sponsored several dialogues in China between Afghan parties.

Only because of the complexities of the situation in Afghanistan does China lack a clear answer. China has stated its particular needs more explicitly this time than in the past. China has far too many considerations when it comes to Afghanistan. However, in comparison to the behavior of many other nations, China’s demands for the Taliban this time have been well thought out, fair, and controlled.

First, China has maintained its previous favorable policy. Despite the fact that the Afghanistan problem is unique, China has not broken its foreign policy of non-interference in internal matters. On the basis of this strategy, China has had interactions with all parties in Afghanistan, ensuring that participation is not only voluntary, but also sufficient to ensure that all parties understand China’s position in order to avoid misunderstandings.

Second, China has stated its opinion on the subjects that most worry it. China has no space for compromise when it comes to national security. China has not raised this matter in the past, but it still needs to voice its viewpoint at the proper moment. As a result, China has the guts to demonstrate its stance, which will aid in the resolution of the situation.

Only when this issue is settled will future collaboration between China and Afghanistan be simple. The Taliban further said that no troops will be allowed to utilize Afghan territory to conduct activities that harm China. Atta regards China as a reliable ally and thinks that China would contribute to peaceful rebuilding.

Furthermore, China has not permitted certain ill-intentioned groups throughout the world to flourish. Following the withdrawal of the US troops, there was speculation in Western culture that China might become engaged in this issue and become the next growing power to enter the “empire’s tomb.” The Indian army’s recent intervention in Afghan politics appears to demonstrate that, as a powerful country around Afghanistan, it is hard to stay out of the issue.

China avoided the urge to intervene and managed its interactions with all sides sensibly, laying the ground for the next phase in the development of China-Afghan relations. So far, China has not fallen into the West’s trap, nor has the deterioration of the situation in Afghanistan harmed its relations with all parties.

As China expands its global presence, it will eventually come into contact with nations with very difficult political and economic situations, such as Afghanistan. However, China will not flee because of obstacles, because the majority of the world’s developed countries are Western countries with strong biases against China, and those wanting to have good relations with China are frequently developing countries with varied challenges. nation. As a result, China has no option.

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Will US-China Tensions Trigger the Fourth Taiwan Strait Crisis?

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Half a century ago, the then-National Security Advisor Henry Kissinger flew to Beijing in the hope of seeking China’s alliance to contain the Soviets. His visit culminated in the U.S. agreement to recognize Beijing as the only legitimate government of China instead of Taipei, going back on the promise he had made to the president of the Republic of China, Chiang Ching-kuo, merely one year previously that Taiwan would never be abandoned by the US. The realistic American diplomat may have never thought that one day Taiwan, once ruthlessly forsaken by the US, would become the latter’s most important strategic fortress in East Asia to contain a rising China.

In 2018, the passage of the Taiwan Travel Act encouraged more high-ranking American government officials to visit Taiwan and vice versa1. The US Undersecretary of State Keith Krach landed in Taiwan two years later, rendering him the highest-level State Department official to visit the island since 19792. The Secretary of State, Mike Pompeo, announced the cancellation of all restrictions on official contacts between the U.S. and Taiwan in January 20213 – an action that was vehemently denounced by the Chinese government as Trump’s “last-ditch madness” that would “push the Taiwan question deeper down the road of no return”4.

Just when the world thought of Joe Biden’s ascension to power as a harbinger of softer attitudes toward Beijing, especially regarding Taiwan issues, the diplomatic muscle flexed by the newly elected US president is as eye-tingling as his aviator shades – first, his Secretary of State, Blinken and Secretary of Defense, Austin made an explicit announcement of the U.S. support for Taiwan; second, he sent former Deputy Secretaries of State Richard Armitage and James Steinberg and former senator Chris Dodd to Taiwan in honor of the 42nd anniversary of the Taiwan Relations Act.

America’s incremental interest in the island is not confined to actions from its executive branches, but it has permeated its legislative system. The introduction of the confrontational “Strategic Competition Act of 2021” in April signals the anti-Soviet-style containment of China which was backed by The Senate Foreign Relations Committee. This bill echoes the “Interim National Security Strategic Guidance” released by the Biden Administration in March, and it emphasizes the urgent need to “achieve United States political objectives in the Indo-Pacific” and back closer ties with Taiwan5. With strong bipartisan support, the bill is expected to be signed into law by President Biden and to serve as a legislative compass to counter China at all levels. In that respect, Taiwan Strait is more likely than ever to become “ground zero” by the U.S. and China.

On the other hand, the crackdown on Hong Kong’s democracy movement under the new National Security Law by Beijing proved to be successful due to the limited backlash received from the West. On top of that, Beijing’s handling of Xinjiang cotton issue seems to have managed to incite nationalism among Chinese people on a short notice to boycott “anti-China forces”6. With a record of 380 incursions into Taiwan’s airspace by Chinese air force during 2020, there is reason to believe that Hong Kong and Xinjiang were “guinea pigs” used by Beijing to test its capability for the fourth Taiwan Strait Crisis, the probability of which has been enhanced by Xi Jinping’s attempt to seek reappointment and Beijing’s need to divert domestic attention away from the escalating social conflicts brought about by the stagnant economy.

So, the pertinent question is: if the fourth Taiwan Crisis does break out, when will it happen? It could be sometime after the 2022 Beijing Winter Olympic Games7 as it is unlikely for China to discard the opportunity to showcase its image and test its comprehensive strength8. This could be déjà vu in light of Russia’s successful Blitzkrieg-style invasion of Ukraine in 2014, which occurred only three days after the end of Sochi Winter Olympics. However, China is not the only one who can learn from history. When the rest of the world anticipates China’s intent with regard to Taiwan, preemptive precautions will be taken. The game-theory-type strategic interaction may hence spur China to launch its attack before the upcoming international sports gala.

Another critical timing could be prior to the 20th National Party Congress of the Chinese Communist Party in October 2022. Xi Jinping’s abolishment of term limits through constitutional amendment may pave the legal foundation for his reappointment, but the “widespread opposition within the party”9 renders the legitimacy of his extended tenure unlikely. That is why some may find it hard to conceive of Xi’s attempt to “start an unnecessary war with Taiwan” before his re-appointment10, but his insatiable desire for a 3rd term may push him over the edge. For the time being, Xi seems to be seduced by his burgeoning self-confidence that China is charging into an epoch of opportunity where “the East is rising and the West is declining,”11 and what time is better than now to consolidate his authority in front of dissidents with a military show-off targeting Taiwan?

As Henry Kissinger12 said, “The historical challenge for leaders is to manage the crisis while building the future. Failure could set the world on fire.” When the leaders of the two greatest powers both see their own countries as the future “Leviathan” of the world, the definition of failure can no longer be merely confined to internal mismanagement, but being surpassed by international competitors. Kissinger may have overestimated some leaders’ senses of honor to bear the responsibility of the “historical challenge”, but he can be right about the catastrophic consequences of their failures. But this time, failure is not an option for either side across the Taiwan Strait nor across the Pacific Ocean

Reference

  1. Chen, Y., & Cohen, J. A. (2019). China-Taiwan Relations Re-Examined: The “1992 Consensus” and Cross-Strait Agreements. University of Pennsylvania Asian Law Review, 14(1).
  2. Mink, M. (2021). The Catalyst for Stronger US-Taiwan Ties. https://keithkrach.com/the-catalyst-for-stronger-us-taiwan-ties/
  3. Hass, R. (2021). After lifting restrictions on US-Taiwan relations, what comes next? Brookings. https://www.brookings.edu/blog/order-from-chaos/2021/01/11/after-lifting-restrictions-on-us-taiwan-relations-what-comes-next/
  4. Global Times. (2021). Pompeo may toll the knell for Taiwan authorities. https://www.globaltimes.cn/page/202101/1212378.shtml
  5. Zengerle, P., & Martina, M. (2021). U.S. lawmakers intensify bipartisan efforts to counter China. Reuters. https://www.reuters.com/world/asia-pacific/us-lawmakers-look-advance-sweeping-bid-counter-china-2021-04-21/
  6. Cui, J., & Zhao, Y. (2021). Boycott of Xinjiang cotton use opposed. China Daily. https://www.chinadailyhk.com/article/161495
  7. Everington, K. (2021). Former US security advisor says Taiwan in “maximum danger” from PLA. Taiwan News. https://www.taiwannews.com.tw/en/news/4189160
  8. China Daily. (2021). Preparing for Winter Olympics promotes quality development – Opinio. China Daily. http://www.chinadaily.com.cn/a/202101/22/WS600a131ba31024ad0baa44f1.html
  9. The Guardian. (2020). China’s Xi Jinping facing widespread opposition in his own party, insider claims. https://www.theguardian.com/world/2020/aug/18/china-xi-jinping-facing-widespread-opposition-in-his-own-party-claims-insider
  10. Roy, D. (2021). Rumors of War in the Taiwan Strait. The Diplomat. https://thediplomat.com/2021/03/rumors-of-war-in-the-taiwan-strait/
  11. Buckley, C. (2021). Xi Maps Out China’s Post-Covid Ascent. The New York Times. https://www.nytimes.com/2021/03/03/world/asia/xi-china-congress.html?_ga=2.178218534.2000768907.1619749005-1359154941.1599697815
  12. Kissinger, H. A. (2020). The Coronavirus Pandemic Will Forever Alter the World Order. https://www.wsj.com/articles/the-coronavirus-pandemic-will-forever-alter-the-world-order-11585953005

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Quad Infrastructure Diplomacy: An Attempt to Resist the Belt and Road Initiative

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Over the years, the competition between the great powers in the dual space of the Indian and Pacific Oceans has been rapidly increasing. In the face of the aggravation of relations between the PRC and the United States, the defence dimension of the rivalry between the two contenders for global leadership traditionally comes to the forefront. However, in today’s context, the parties will most likely not engage in military action for the strengthening of their dominance in the region, but they will try to achieve the goals by expanding of economic influence. In this context, along with the well-known trade wars, there is an infrastructure rivalry in the region, which is enforced on Beijing by Washington and the Quadrilateral Security Dialogue (Quad).

The role of Infrastructure in Indian and Pacific Oceans’ countries

The countries of Asia traditionally drawing the attention of the world community due to the high rates of economic, technological, and social development. In less than three decades, their per capita income has increased by 74%, millions of people have been lifted out of poverty, as well as a growing middle class has emerged in the region. All this became possible due to the multilateral cooperation institutionalization and the integration of the economies of the Indo-Pacific. However, the strengthening of trade and economic ties and the future prosperity of Asia largely depends on the infrastructure (ports, highways and railways, airports, pipelines, etc.), which contributes to a more active movement of goods on a regional and global scale. Moreover, back in 2009, the Asian Development Bank (ADB) published a report according to which collective investments in infrastructure in the amount of US$8 trillion will be required to maintain rapid economic growth in Asian countries.

The most prominent infrastructure initiative in recent years is the «Belt and Road Initiative» (BRI), which was launched by China’s leader Xi Jinping in 2013. The BRI helped to fill numerous infrastructure gaps, but the United States and its partners increasingly paid attention to the geostrategic aspect of China’s actions. It’s no secret that the Belt and Road plays an important role in the development and integration of China’s provinces with neighboring countries. However, with the growing number of countries participating in the BRI, as well as the strengthening of China’s influence on a regional and global scale, criticism of the strategic tools for expanding Beijing’s economic influence gradually increased. The Belt and Road has faced a number of critical remarks, including those related to accusations of purposely involving the regional countries in the so-called «debt traps». Regardless of the degree of truthfulness or study of the issue, from year to year, media reports have contributed to the building of a contradictory attitude to China’s BRI among the residents, experts, and political elites all over the world.

Moreover, as soon as Donald Trump became the U.S. President in early 2017, Washington modified the nature of its policy towards China to greater confrontation. This trend has become a direct expression of the intensified great powers’ rivalry and their struggle for hegemony in the Indo-Pacific, as well as a motivation for the revival of the Quadrilateral Security Dialogue (Quad), which includes the United States, Australia, India and Japan. However, the interaction of the Quad has long been built on the basis of defence.

This trend continues nowadays, as evidenced by the frequent exercises and the growing Quad naval presence in the Indo-Pacific but in 2021 the Quad countries expanded their range of issues on a multilateral basis. Now the agenda includes vaccine diplomacy (providing 1 billion COVID-19 vaccines to Indo-Pacific countries, climate change, technological cooperation, maritime security, cybersecurity, and external development assistance. According to Kurt Campbell, Indo-Pacific policy coordinator at the National Security Council, Washington is looking to convene an in-person fall summit of leaders of the Quad countries with a focus on infrastructure in the face of the challenge from China.

Quadrilateral infrastructure diplomacy as the continuing vector of the Trump’s administration

The infrastructure agenda also became an important part of the last summit of the G7 countries’ leaders, during which the parties expressed their willingness to establish a BRI counterpart called Build Back Better World (B3W). In total, there are 22 mentions of infrastructure in the final G7 Summit Communiqué. Even despite the traditionally restrained position of India, which took the time to «study the specifics of the proposal», infrastructure diplomacy of Quad is becoming a new area of geostrategic competition in the Indo-Pacific.

There’s one exception: the activities on the infrastructure track are not a new trend of U.S. President Joe Biden’s administration, but a continuation of the foreign policy vector set during the presidency of Donald Trump. It was he who turned Sino-U.S. rivalry into a geo-economic level. Back in 2017, the Foreign Ministers of the Quad countries stated the need for high-quality infrastructure development in order to ensure freedom and openness of sea routes, as well as improve intra-regional ties. In 2018, MoU was signed between the US Overseas Private Investment Corporation (OPIC), the Japan Bank for International Cooperation (JBIC) and the Ministry of Foreign Affairs and Trade of Australia, aimed at implementing major infrastructure projects in the Indo-Pacific. Moreover, the Quad countries raised the question of the BRI countries’ growing debt during their official meeting in Singapore.

It was clear that the Belt and Road Initiative is perceived by the Quad countries as the main factor in expanding the economic and political influence of the People’s Republic of China, as well as China’s influence of the domestic political processes in the countries of Indo-Pacific. At the same time, the combination of economic and defence rivalry enforced on Beijing by Washington, as well as Quad’s efforts to build a balance of power in the region actually indicates the explicit anti-​China nature of the Quad.

In this case, it’s important to note that each of the Quad countries has its own levers of influence, which they can combine in infrastructure competition with Beijing. For example, in 2015, in response to the implementation of the Belt and Road Initiative and the establishment of the Asian Infrastructure Investment Bank (AIIB) by China, Japan made the Partnership for Quality Infrastructure (PQI). The United States, in turn, announced the infrastructure project Blue Dot Network (BDN), as well as the Ministry of Foreign Affairs and Trade of Australia established a new Partnerships for Infrastructure (P4I). All these initiatives are united by a commitment to inclusive economic growth, «quality infrastructure», climate change, disaster response, and social development. The capitalization of the Japanese, American and Australian initiatives is US $110 billion (US$50 billion from Japan and over US$50 from the Asian Development Bank), US$30-60 million, and US$383 thousand (including access to US$4 billion of foreign aid and $US2 billion from the Australian Infrastructure Financing Facility for the Pacific), respectively. Given the ongoing discussions about debt traps, the emphasis on «high-quality infrastructure» may give special features to the initiatives of the Quad but even the total amount of funding will not be able to compete with the US$770 billion investments already made in 138 countries of the world and announced by China.

Anyway, Quad is stepping up its infrastructure diplomacy in at least three areas, including Southeast Asia, Oceania, and the Indian Ocean. For example, Australia, Germany and Switzerland have already allocated US$13 million to the Mekong River Commission For Sustainable Development (MRC) to assist Cambodia, Laos, Thailand and, Vietnam «to respond to pressing challenges while safeguarding the ecological function of the Mekong River and improving people’s livelihoods».At the same time, Australia signed US$300 million MoU with Papua New Guinea, aimed at the ports reconstruction in the major state of Oceania (the ports of Vanimo, Kimbe, Motukea, Lorengau, Oro Bay, Daru, Lae, etc.). It is important to highlight that the increasing economic and infrastructural presence of China in the countries of Oceania, energize Australia’s policy in the South Pacific, which is a traditional zone of influence of Canberra. At the same time, the expansion of Australia’s aid and investment to the broader Indo-Pacific is due to the commitment of the current Australian government to the U.S. foreign policy.

In turn, the reaction of the Southeast Asian countries to the intensification of Quad infrastructure diplomacy will be more restrained. According to the latest Pew Research Center survey, the most unfavourable view of China is in the United States (76%), Canada (73%), Germany (71%), Japan (88%), Australia (78%), and South Korea (77%), while in Singapore — the only country representing ASEAN in the survey — the percentage of unfavourable views on China is at a low level (34%). Moreover, considering the aspects of infrastructure diplomacy in the region, we should definitely refer to the survey of the Center for Strategic and International Studies (CSIS) of the political elites of the region «Powers, Norms, and Institutions: The Future of the Indo-Pacific from a Southeast Asia Perspective», published in 2020. Despite the intentional exclusion of Russia from the survey, it approximately reflects the trends in the Indo-Pacific countries at the present stage. Thus, as a result of the survey, American experts revealed that the political elites of Southeast Asia positively assess China’s activities in the field of infrastructure development, which has brought tangible benefits to most Southeast Asian countries.

Beijing’s Response

China is actively reacting to verbal attacks from the United States and Quad. The infrastructure agenda was no exception, but China responded by modernizing its global Belt and Road Initiative. In response to criticism about the involvement of the countries in debt traps, Beijing has developed a new Foreign Policy White Paper «China’s International Development Cooperation in the New Era». The document was published in early 2021. According to the provisions of the new White Paper, China will pay closer attention to the process of implementing projects within the aid framework, take an active part in evaluating projects in order to monitor their quality, maintain an appropriate level of confidence in its projects to China, as well as conduct bilateral consultations to identify difficulties with debt repayment and make sure that partners do not fall into a debt trap. It’s possible that the new vision of the PRC will appear especially quickly in countries where the Quad will primarily try to implement their infrastructure projects.

China is the first country in the region, which pays significant attention to the issues of large-scale infrastructure development. Moreover, Beijing has a number of advantages over its opponent — Quad. First, the Belt and Road initiative is more structured and aimed at intensifying trade, economic, cultural and humanitarian cooperation with neighboring countries, while the emerging Quad infrastructure agenda is «dispersed» among numerous individual initiatives, doesn’t have the same level of stability as the BRI, and even after 3.5 years of building the agenda is considered through the prism of expectations.

Second, China’s initiative is aimed at a single infrastructure connection between the PRC and the rest of the world and acts as a potential basis for the intensification of global trade in the future. At the same time, today’s projects of the Quad are of a “sporadic» nature and can’t contribute to the infrastructure linkage between Europe, Africa, South and Southeast Asia on a global scale.

Third, China can already offer the Belt and Road members not only logistics infrastructure but also the opportunities in the field of green energy. At the end of 2019, China produced about a third of the world’s solar energy and retained a leading position in the number of wind turbines. Within the foreseeable future, the Quad countries, and especially the United States, will have to compete with China even in the field of the climate agenda, which is so close to the new administration of the U.S. President Joe Biden.

Finally, during his recent speech on the occasion of the 100th anniversary of the Chinese Communist Party (​CCP), PRC’s Leader Xi Jinping confidently declared the great revival of the Chinese nation, its contribution to the progress of human civilization, and its readiness to build a new world, which undoubtedly indicates China’s decisiveness to respond to challenges to its address, including from the Quad.

Conclusion

The ongoing transformation of the regional architecture in the Indo-Pacific, both in the defence and economic areas, will be an important aspect in the post-pandemic era. China has repeatedly stated about the «covered» Quad activities to deterrence Chinese policy in the region, but the expansion of the Quad’s agenda by infrastructure diplomacy allows us to speak about the evident vector of the Quad strategy against the PRC.

However, nowadays the Quad countries had been left behind. China already has the world’s most numerous land forces, the largest navy, as well as an ambitious global Belt and Road initiative that includes almost 140 countries and a capitalization approaching US$1 trillion. Of course, Quad is moving towards the institutionalization of its infrastructure cooperation and the potential expansion of the number of participating countries to the Quad Plus format. However, to reach China’s achievements for the period 2013-2021, the new alliance will need at least a decade.

At the same time, the rivalry of the Belt and Road with the Quad’s infrastructure initiative will help the countries of the region to diversify their infrastructure ties but will make their choice even more difficult, since it will primarily be regarded as support for the foreign policy vision of one of the parties, and not a pragmatic estimate of economic benefits. All this makes the regional environment in the Indo-Pacific increasingly complex and forces middle powers and smaller countries to adapt to new geostrategic realities.

From our partner International Affairs

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