How is China’s growing international status likely to affect the future trajectory of global governance? Will it operate within the confines of liberal order, or attempt to substantively revise the existing global framework? The speaker will argue that China is now playing an active role in shaping the rules, norms, and institutions of global governance. She will offer some fresh insights into this new trend in Chinese foreign policy by placing a lens upon key global policy-making realms, including the maritime commons, where conflicts over international norms and national interests are most stark.

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Long predicted, many observers now think that China has or is about to become more powerful than the United States on the global stage. Joseph Nye will explore the facts behind these beliefs and question if the century of American centrality in the global balance of power is at an end.

LIVE STREAM: This event will be live streamed. The live stream will be made available at 18:00 BST on Tuesday 9 June.

ASK A QUESTION: We will endeavour to ensure that questions are put to the speaker from our online audience as well as from the audience in the auditorium. Questions can be sent in advance via email to questions@chathamhouse.org and during the event on Twitter using #CHEvents.

The speaker will argue that Chinese foreign policy should be viewed as an extension of domestic policy to a degree not seen in other countries. China's foreign policy aims to support domestic growth and employment, must be aligned with nationalist and narratives of ‘rejuvenation’ and the ‘China Dream’, and must help dilute hostile foreign values. The ‘One Belt, One Road’ project, also known as the ‘New Silk Road’, exemplifies this. The speaker will illustrate its origins and development, discuss how it promotes the Communist Party’s domestic agenda, as well as look at (secondary) geostrategic aims and difficulties. Finally, he will look at the lessons for Europe, and why and how this Chinese initiative should be welcomed.

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It has become routine for China’s leaders to use high profile international events as a means of projecting a preferred image of what China stands for and how it will act as  a great power, one that is perhaps now second only to the US in the league table of global powers. So it is no surprise that Xi Jinping has used his interventions at the UN development summit and his address to the General Assembly to showcase China’s growing role as a global aid actor, and to call for greater ‘democratization’ of global governance institutions (or, in other words, a greater role and say for China and other developing countries). China’s alleged and self-proclaimed (and challenged) predilection for peace, a desire to build a ‘new type’ of (vaguely defined) international relations, and support for the UN as the sole arbiter of when sovereignty might possibly be put aside (instead of the US or a coalition of the willing) are also now relatively well-established and rehearsed Chinese positions.

In addition to wielding China’s financial power in support of this national image projection, Xi’s activities also represent a move towards mobilizing discursive power (话语权) as well. To date, and for a number of years, this discursive power has been primarily deployed in a defensive manner, with the aim of denying the supposed universal nature of many of the norms and principles of the international order. These norms, as articulated by both Chinese government officials and some supportive academic scholars, are not universal at all, but merely the product of a small number of Western countries’ histories, philosophies and developmental trajectories. So, in this formulation, while it is important to have a common set of principles and responsibilities as the basis for international interactions, each country should be free to develop its own nation-specific definitions based on its own unique histories and contexts. And it is only these Chinese-inspired definitions and aspirations – of human rights, for example, or development – that China should be judged against.

But this position has changed under Xi, with China’s leaders increasingly keen on promoting Chinese understandings and definitions as the basis for international debates and international action. Hot on the heels of Chinese attempts to take a leading role in defining the basis for global cyber diplomacy,  China is now seeking to shape the way that development is defined and understood – which of course has massive implications for how development, thus defined, might be attained.

Leading on development, missing on security

Xi’s willingness – or should that be desire – to establish Chinese potential global leadership was less apparent when it came to solving the major security challenges of the day. To be sure, there was talk about the need for new ways of dealing with insecurity that recognize the consequences of globalization and that no country can solve problems on its own – including, presumably, the United States. The pledge of more peacekeepers will cement China’s position as one of the world’s major contributors to UN overseas activities, and the promise of a military assistance fund to the African Union shows that Beijing really is an important security actor beyond its own borders. But when it comes to conflict in places like Syria, China seems content to maintain its back seat and allow Russia to take the lead in a crisis that is admittedly some distance from China’s own backyard. Expect a Chinese-led agenda for the G20 summit in 2016 in China that reinforces this differential willingness to assume leadership roles depending on the specific issue at hand.  

So for the time being, the aim seems to be primarily to confirm the idea that China is a new and very different type of great power; one that is a friend and supporter of those smaller developing states and emerging powers that had previously suffered from the asymmetric economic and military power of great powers in the West (or in some cases, still do). As part of this ‘difference’ a second related objective seems to be to establish China as a global leader on development issues.

But simply asserting something does not mean that it is true, and its something of an understatement to suggest that China’s pacific and non-interventionist self-identity has not been accepted by everybody, particularly in East and Southeast Asia. China’s developmental achievements have also been questioned. The response in Beijing to Hilary Clinton’s tweet that it was ‘shameless’ that Xi was co-host of a meeting on women’s rights shows that the defensive nature of Chinese policy remains in place: ‘those in the best position to judge the state of women's issues in China are Chinese people, particularly Chinese women’, according to the foreign ministry. And Clinton’s comments also show that the field of ideas is not being left open for China to do whatever it wants just yet; gaining widespread acceptance for Chinese preferences is not going to be an easy task and will likely face considerable resistance. But the suggestion here is that the world is likely to see a growing Chinese presence over the coming years not just as a global development and aid provider, but also as a putative developer of new global norms.

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Professor Brown will examine how Xi Jinping has consolidated authority since becoming head of the Communist Party in 2012 and explore what his goals are for the future of China. Is Xi trying to cement his own power or protect the interests of the party by guiding it towards a more sustainable rule?

This talk will introduce the key arguments in CEO China: The Rise of Xi Jinping, the speaker’s full-length, English language study of Xi, his background, current position and core beliefs.
 

Much of the focus on China’s 13th Five Year Plan – its centralized and integrated economic guidelines for the next five years – has been on the estimated growth rate of 6.5 per cent, its lowest in recent history. This reflects the so-called ‘new normal’ of China’s development, as President Xi Jinping’s administration describes its aspiration for higher-quality growth in the context of a slowing economy.

But this growth target is an estimate, rather than a pledge. The emphasis on ‘ecological civilization’ – another of Xi’s signature buzzwords, referring to a broad set of approaches environmental protection – is striking. Further, by putting innovation and ‘green development’ at the heart of its ambition to create a ‘moderately prosperous society’, China has sent an important signal: that the country’s strategy for future prosperity in many respects converges with a shift away from its environmentally costly development model.

Environmental goals

The plan endorses a ‘vertical management system’ that will help overcome structural impediments to the local enforcement of environmental laws,  and of its 13 binding targets, 10 relate to the environment and natural resources. In the plan, China commits to an 18 per cent reduction in carbon emissions per unit of GDP from 2015 levels by 2020 and a 15 per cent reduction in energy consumed per unit of GDP from 2015 levels by 2020. It also re-commits to generate 15 per cent of primary energy from non-fossil sources and introduces an important new target of keeping energy consumption below 5 billion tonnes of standard coal equivalent by 2020. Underlining how air quality has become a major driver of energy and climate policymaking, it also promises a 25 per cent reduction in harmful PM2.5 particulates.

In short, the plan suggests that decision makers in China not only take seriously its UN pledge to see a peak in the country’s emissions before 2030, but also that they hope the country will be the leading supplier of low-carbon technologies. Among its non-binding targets are some significant innovation-related measures: to raise gross expenditure on research and development as a percentage of GDP to 2.5 per cent, from 2.1 per cent today; and over the same period to almost double the number of patents owned per 10,000 people, from 6.3 to 12.

Innovation

The document makes clear the principal driver of China’s economy should be innovation, rather than investment. Innovation, says the plan, ‘must be placed at the heart of overall national development’ and ‘integrated into all the works of the Party and the country’. There is emphasis on strategic areas at the ‘frontiers’ of science, ‘mass entrepreneurship’ through new models such as crowd-funding, and digital economy projects – what the leadership likes to call ‘Internet+’ – including around the Internet of Things, quantum computing and big data.  

Under China’s 12th Five Year Plan (from 2011 to 2015), the state focused on a defined number of specific technology goals in its ‘strategic emerging industries’. Renewable energies and electric vehicles, for example, were afforded specific preferential policies. By contrast, the new plan has a greater focus on ‘clean coal’ and hydropower in the energy sector; and while it doesn’t abandon solar and wind, it also suggests greater diversity in its overall approach, with more of an emphasis on reform of the energy sector, developing smart power grids and investing in energy storage technologies such as batteries and fuel cells.

Moreover, innovation in the plan is not framed as simply being about hardware – the commercialization of science and technology. Rather, the text reiterates that innovation should come in many different varieties: ‘theoretical, institutional, scientific and technological, and cultural innovation’. This raises the intriguing and hopeful possibility that the country’s planners recognize some of the challenges and opportunities the public, particularly in the form of newly vocal, engaged and connected urban constituencies, pose in the governance of innovation.

Policymakers – taking ‘social innovation’ seriously – could begin look at the public as technology users, incubators of demand-driven successes, and innovators in their own right. In a context of low public trust around food and agriculture in China, for example, organic cooperatives and ecological entrepreneurs have pioneered supply-chain innovations, typically facilitated by digital networks, to connect farmers with urban consumers looking for safer food. Lower-tech approaches to energy too – such as inexpensive solar water heaters, which garner a mention in the latest plan – have been driven by rural users and supported by local initiatives, rather than central government coordination or subsidies.

These approaches to innovation would present a quite different model than previous central government plans have encouraged. Whether in the plan’s implementation they are harnessed and given support might be critical to meeting China’s environmental goals, as well as its drive to create a more innovative economy and society.

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It is tempting to read China's refusal in this case to acknowledge the jurisdiction of the arbitral tribunal in The Hague as the defiance of an arrogant superpower that views itself as above international law. No doubt many in Manila, Washington and elsewhere are purveying this view. But there is more here than meets the eye.

For decades, Beijing has complained that the global order was forged in an era when China was weak and the rules of the game are rigged against it.

But this lament is more difficult to sustain in relation to the UN Convention on the Law of the Sea, which China helped negotiate in the 1970s and early 1980s. Beijing signed the treaty as soon as it was opened for signature in 1982 and ratified it in 1996.

The Philippines initiated this arbitration against China in 2013 as part of a long-running dispute over rights in the South China Sea, including over the Spratly Islands (known as the 'Nansha Islands' in China) and surrounding maritime areas. 

Under the treaty, China is not obliged to defend the case but this is no bar to proceedings and it remains legally bound by the award. From a legal perspective, its refusal to participate is thus a risky move, all the more so since the ruling is likely to have legal ramifications for China's highly charged maritime disputes with other neighbours such as Vietnam and Malaysia.

It is well known that the legal proceedings launched by the Philippines sparked a contest of ideas in Beijing. Behind closed doors, some Chinese international lawyers argued that China should prove its commitment to the international rule of law by vigorously fighting its corner in the arbitration. The defeat of these liberal voices is usually interpreted as an inevitable effect of the nationalists' grip on power under President Xi Jinping.

In a significant concession to those on the losing side of the argument, however, China published a position paper setting out its objections to the jurisdiction of the tribunal and formally conveyed this to the tribunal which treated it as ‘effectively constituting a plea on jurisdiction’.

This novel form of ‘non-participating participation’ must be seen against the backcloth of a strategic ambition by China to develop a greater mastery of international law. At an important meeting just two months earlier, the Communist Party called for China to strengthen its ‘discourse power and influence in international legal affairs’ and use legal methods to safeguard its ‘sovereignty, security and development interests’.

Our research team at Chatham House has been tracking impressive steps by China to realize this goal, including new government decision-making machinery designed to promote compliance with international law, a hiring spree of international lawyers and new advisory committee for the Ministry of Foreign Affairs, promotion of scholarship and efforts to show norm leadership especially in ‘new domains’ of international law such as cyber law, and a training programme to share growing Chinese international law expertise with the global South.

We know from Chinese colleagues that maritime disputes are a major impetus for this drive. For years, the Chinese government has fretted about its low capabilities in the international legal field, compared with other permanent members of the UN Security Council and regional rivals such as Japan. Now, impelled by the need to protect its strategic interests in the South China Sea and elsewhere, it is doing something about it.

It may seem paradoxical in light of its bullish attacks on the Philippines and even the tribunal itself, but China's boycott of the arbitration should also be seen as a manifestation of its low confidence in its own capacities in the realm of international law. Speculation is rife that the leadership lacks faith in its ability to convince the tribunal of the legal validity of its controversial ‘nine dash line’ demarcation of China's rights in the South China Sea.  

In the arbitration and otherwise, China has avoided clarifying the precise legal basis and implications of its ‘nine dash line’ claims while sponsoring a vast industry of academic studies to support its position.

In the meantime, China is playing to its strengths, including its deep pockets, in pursuing an extrajudicial approach. An audacious programme of land reclamation and militarization of atolls and escalating patrols and exercises in disputed territories is a clear effort to alter ‘the facts on the water’. And in recent months it has choreographed statements of political support for its South China Sea claims from a motley crew of states with economic ties to China.

While China's rejection of the South China Sea arbitration is true to form for a powerful state that, like its great rival the United States, is generally ill-disposed towards binding international dispute resolution processes, it is not inconceivable that this approach will give way when China becomes more confident in its ability to play and win at ‘law fare’, as we are already seeing in the context of World Trade Organization disputes. Until then, in time-honoured fashion, Beijing is biding its time, plugging its skills gap and hoping it can shake off mounting reputational damage from its petulant spurning of these proceedings.

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The arbitration between the Philippines and China on the dispute in the South China Sea is coming to an end. The Permanent Court of Arbitration is to issue its decision on 12 July. This meeting will discuss the notable points of the tribunal’s award and the next steps. 

Attendance at this event is by invitation only.

The ruling by an arbitral tribunal of five members based in The Hague was simple and devastating. It declares that ‘China’s claims to historic rights… with respect to the maritime areas of the South China Sea encompassed by the relevant part of the “nine-dash line” are contrary to the [The UN] Convention [on the Law of the Sea, UNCLOS]’. This is a result that Southeast Asia’s maritime countries have long sought. The way is now clear to resolve all the disputes in the region, if the participants choose to do so.

For decades, countries around the South China Sea lived under the shadow of a quasi-territorial claim that no one really understood. What did the U-shaped, nine-dashed line marked on Chinese maps actually mean? In 2009, the Chinese government attached a copy of the map to an official submission to the UN Commission on the Limits of the Continental Shelf and the region became alarmed. For the first time, it seemed that China was serious about asserting a claim to all the land and water inside the line.

On Tuesday that claim was dismissed as entirely incompatible with international law. Moreover, the Arbitral Tribunal ruled that not one of the Spratly Islands qualifies as an ‘island’. This ruling is at least as significant: it means none of the features in the archipelago are entitled to an exclusive economic zone. Theoretically it should now be simple to resolve all the maritime disputes in the southern part of the South China Sea. The Philippines, Malaysia, Brunei, Indonesia and the Philippines can, in principle, draw lines up to 200 nautical miles out from their coasts and agree compromises where they overlap. China is now irrelevant to this process because its nearest coastline is simply too far away.

All the 50 or so features in the Spratly Islands that are naturally above water at high tide would be granted a 12-nautical-mile territorial sea. The resulting settlement would resemble a Swiss cheese: large areas of exclusive economic zone measured from national coastlines punctuated by a few dozen ‘bubbles’ of disputed territory. This would not resolve the disputes about which country is the rightful owner of those ‘bubbles’ but it would settle the maritime disputes in the sea around them.

Of course, there are still wrinkles. Not least is the Philippines claim to the Malaysian province of Sabah in northern Borneo. This means that, for the time being, those two countries can’t settle the maritime boundary between them. They could, nonetheless, agree how far it projects offshore.

The bigger problem will be China’s attitude. Its response to the tribunal’s ruling has been angry but curiously misdirected. State media have focused their ire on questions of territorial sovereignty – even though the tribunal was barred from even considering this subject. China’s territorial claims to the rocks of the Spratly Islands are entirely unaffected by Tuesday’s ruling. There must be separate processes to resolve those questions.

China has many interests in the South China Sea – including defence, trade routes, fisheries and hydrocarbons – so it’s not surprising that it pursues whatever approach it thinks practical in order to protect them. However, the whole purpose of the UN Convention on the Law of the Sea was to create an international order that defended the rights of countries to exploit the resources off their own coasts without threat from other states further away. China was a full participant in the negotiations between 1973 and 1982 that created UNCLOS and, at that time, was a strong defender of the rights of coastal countries.

While it may feel that it has lost out from this week’s ruling, China has much to gain from a strong community of regional order in the South China Sea. Most Southeast Asian countries remain alarmed by China’s intentions − which is why, in the past few years, they have been strengthening their ties with the United States and increasing military spending. China’s wider interests would benefit from a de-escalation of this tension. Reassuring its neighbours would give them less reason to rely on the US.

Putting a new maritime order in place, based upon UNCLOS and commitments between China and the Association of Southeast Asian Nations, would be a major step towards this. It would also bring many associated benefits – not least cooperation to protect the region’s fish stocks, which are facing disastrous collapse. The first step is accepting the implications of Tuesday’s ruling.

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