The COVID-19 crisis has accelerated geopolitical tensions that, in part, have arisen from US-China tensions. At a time when the world needs strong and collective leadership to fight the coronavirus, both countries have been locked in a battle of words characterized by escalating hostility, polarizing narratives, blame and misinformation. Caught in the crossfire, many people of Chinese descent across differing countries have reported an increase in xenophobic attacks.

Middle powers such as the UK and Australia have swerved between recognition of the global collaboration needed to solve this pandemic and calls for China to be held ‘accountable’ for its initial response. Others such, as France and Japan, have been trying to foster international cooperation. 

Against this context, speakers will discuss China’s response to the crisis, including the initial delay and Beijing’s later containment strategies. How do we best assess the delay amidst all the heated rhetoric? What was the response of people within China to the measures? Does COVID-19 mark a point of no return for US-China relations? How might this impact on relations between US allies and China? And what kind of China will emerge from this current crisis?

Jocelyn Ford will share her experiences and insights from documenting the struggles of a widowed Tibetan facing ethnic discrimination in Beijing and gender discrimination in her village. The panel will then have a wider discussion about national identity and the issues facing ethnic minorities in China.  

This discussion coincides with the UK screening of Nowhere to Call Home: A Tibetan in Beijing and will include clips from the film.

Following 21 years since the adoption of the Beijing declaration by 189 states, China has the opportunity to lead the way in prioritizing gender-inclusive growth policies on the G20 agenda, as it is hosting the G20 this year.

This roundtable will examine specific challenges in China, a country with a high heterogeneity in the labour force and among its population. The event will bring together representatives of government, business and civil society to continue the dialogue that Chatham House started one year ago in Beijing. Taking stock of the progress achieved so far, the participants will analyse what type of recommendations can have a positive impact in both rural and high- density populated areas.

Attendance at this event is by invitation only.

The Chatham House Rule 

To enable as open a debate as possible, this event will be held under the Chatham House Rule. 

Video: Marianne Schneider-Petsinger and Dr Yu Jie discuss key themes from the research paper

Summary

• The underlying driver of the ongoing US–China trade war is a race for global technological dominance. President Trump has raised a number of issues regarding trade with China – including the US’s trade deficit with China and the naming of China as a currency manipulator. But at the heart of the ongoing tariff escalation are China’s policies and practices regarding forced technology transfer, intellectual property theft and non-market distortions.
• As China’s international influence has expanded it has always been unlikely that Beijing would continue to accept existing global standards and institutions established and widely practised by developed countries based on ‘the Washington Consensus’.
• China’s desire to be an alternative champion of technology standard-setting remains unfulfilled. Its ample innovation talent is a solid foundation in its quest for global technology supremacy but tightening controls over personal freedoms could undermine it and deter potential global partners.
• It is unclear if Chinese government interventions will achieve the technological self-sufficiency Beijing has long desired. China’s approach to macroeconomic management diverges significantly from that of the US and other real market economies, particularly in its policy towards nurturing innovation.
• Chinese actors are engaged in the globalization of technological innovation through exports and imports of high-tech goods and services; cross-border investments in technology companies and research and development (R&D) activities; cross-border R&D collaboration; and international techno-scientific research collaboration.
• While the Chinese state pushes domestic companies and research institutes to engage in the globalization of technological innovation, its interventions in the high-tech sector have caused uneasiness in the West.
• The current US response to its competition with China for technological supremacy, which leans towards decoupling, is unlikely to prove successful. The US has better chances of success if it focuses on America’s own competitiveness, works on common approaches to technology policy with like-minded partners around the globe and strengthens the international trading system.
• A technically sound screening mechanism of foreign investment can prevent normal cross-border collaboration in technological innovation from being misused by geopolitical rival superpowers.

The US and China have entered into an increasingly confrontational relationship over trade and technology. This may force Europe to make difficult choices between the two economic superpowers – or perform a balancing act. Although the recent US-China phase-1 trade deal has eased the relationship for now, the trade and technology tensions are a structural issue and are likely to persist.

The debate over Huawei’s participation in 5G networks is an example of how the UK and other countries may face competing priorities in economic, security and foreign policy. Can Europe avoid a binary choice between the US and China? Is it possible for the EU to position itself as a third global power in trade, technology and standard-setting? What strategies should Europeans adopt to keep the US and China engaged in the rules-based international order and what does the future hold for trade multilateralism?

Sir Simon Fraser will join us for a discussion on Europe’s future role between the US and China. Sir Simon is Managing Partner of Flint Global and Deputy Chairman of Chatham House. He previously served as Permanent Secretary at the Foreign and Commonwealth Office (FCO) and Head of the UK Diplomatic Service from 2010 to 2015. Prior to that he was Permanent Secretary at the UK Department for Business, Innovation and Skills. He has also served as Director General for Europe in the FCO and Chief of Staff to European Trade Commissioner Peter Mandelson.

We would like to take this opportunity to thank founding partner AIG and supporting partners Clifford Chance LLP, Diageo plc, and EY for their generous support of the Chatham House Global Trade Policy Forum.

This event is part of the Inaugural Virtual Roundtable Series on the US, Americas and the State of the World and will take place virtually only. Participants should not come to Chatham House for these events.

This event is part of the Chatham House Global Trade Policy Forum. We would like to take this opportunity to thank founding partner AIG and supporting partners Clifford Chance LLP, Diageo plc, and EY for their generous support of the forum.

Only a few months into 2020, the coronavirus pandemic has presented a huge challenge for China’s ruling party against an already tumultuous 12 months of economic slowdown coupled with an increasingly hostile international environment. The crisis looks set to worsen a deteriorating relationship between the US and China as the two countries battle to avoid further economic ramifications. It has also undermined President Xi Jinping and the Chinese Communist Party’s domestic political legitimacy and economic growth.

The panellists will examine the wider geopolitical fallout of the coronavirus pandemic and discuss China’s future economic planning. How will the COVID-19 outbreak further strain the US-China relationship? What effect will this have on global trade and vulnerable supply chains at a time when cooperation is needed more than ever? And to what extent is the ruling party addressing growing concerns over job losses, wealth inequality and a lack of social mobility?

This event is only open to Major Corporate Member and Partner organizations and selected giving circles of Chatham House. If you'd like to attend, please RSVP to Linda Bedford.

So far, there has been a noticeable worsening of relations that had already soured in recent years – the latest step being President Donald Trump’s suspension of US funding for the World Health Organization (WHO) in response to accusations of Chinese interference in its operations.

Should the world now simply prepare for a period of intense and extended hostility? As director of a policy institute founded 100 years ago in the shadow of the First World War, I believe we must do all in our power to avoid a return of the global strategic rivalries that blighted the 20th century.

Deepening suspicions

Of course, the outcome does not lie only in the hands of the US and Europe. In the 1930s, as much as they wanted to avoid another great war, British and French leaders were forced to respond to Germany’s aggression in central Europe. In the late 1940s, America’s instinct to disentangle itself from war-ravaged Europe was quickly tempered by the realization that the Soviet Union would impose or infiltrate Communist control as far into Europe as possible.

Today, those who warned that China - a one-party, surveillance state with a power-centralising leader - could never be treated as a global stakeholder feel vindicated. They see in COVID-19 an opportunity to harden policies towards China, starting by blocking all Chinese investment into 5G infrastructure and breaking international dependence on Chinese supply chains.

They can point to the fact that Chinese Communist Party officials in Wuhan initially prioritised sustaining economic growth and supressed reports about COVID-19’s capacity for human-to-human transmission, epitomised by their treatment of Dr Li Wenliang. They can highlight how Beijing’s obsession with denying Taiwan a voice in the WHO prevented Taiwanese input into the early analysis of the crisis. They can highlight the ways in which Beijing has instrumentalised its medical support for coronavirus-afflicted countries for diplomatic gain.

For their part, those in China who believed the US and Europe would never allow China’s return as a regional and world power see this criticism as further evidence. They can point to comments about this being the ‘Chinese virus’, a leaked biological weapon or China’s ‘Chernobyl moment’. ‘Wolf warrior’ Chinese diplomats have sought to outdo each other by challenging narratives about COVID-19, while propagating disinformation about the origins of the virus.

There are major risks if this blame game escalates, as it could in the lead-up to a fraught US presidential election. First, consciously uncoupling the US economically from China will make the post-coronavirus recovery that much harder. China already accounts for nearly 20% of world GDP but, unlike after the global financial crisis in 2008, it is fast becoming the world’s leading consumer market. Its financial stimulus measures need to be closely coordinated with the G7 and through the G20.

Second, Chinese scientists were the first to uncover the genetic code of the virus and shared it with the WHO as early as January 12, enabling the roll-out of effective testing around the world. They are now involved in the global search for a vaccine alongside American and European counterparts. While the Chinese government will remain a legitimate target for criticism, Chinese citizens and companies will contribute to many of the most important technical breakthroughs this century.

Third, if COVID-19 creates a long-term schism between China and the US, with Europeans caught on its edge, this could do deep damage to world order. China may become a less willing partner in lowering global greenhouse gas emissions and sharing renewable energy technologies; in helping African and other developing countries grow sustainably; and in helping to build a more resilient global health infrastructure.

Getting the balance right

But the COVID-19 crisis can also be the hinge point to a more coherent and self-interested transatlantic approach to China, one whose motto should be ‘beware but engage’. There should indeed be limits on state-backed Chinese investment in strategic US and European economic sectors, just as China limits Western access to its market. But the goal should be to lower barriers to trade and investment over time on a mutually beneficial and transparent basis, not to recreate an economic Cold War.

Chinese human rights violations, at home and abroad, should be called out. The dissemination of Chinese systems of citizen surveillance, which will be more popular in a post-coronavirus world, should be monitored and contested with US and European alternatives. And the extent of Chinese exports’ access to international markets should be conditional on China improving its phytosanitary standards - which protect humans, animals, and plants from diseases, pests, or contaminants - and strictly regulating unhygienic wet markets.

But to go further and try to make disengagement the dominant transatlantic policy as COVID-19 subsides will not only divide Europe and America. It will also contribute to a self-fulfilling prophecy; in which a resentful China grows apart from the US and Europe during a period where they must work together.

Given that it will likely be the world’s largest economy in 2030, how the US and Europe manage their relations with China after this crisis is a question at least as seminal as the one they faced after 1945 with the Soviet Union. In the ensuing years, the Soviet Union became a military superpower and competitor, but not an economic one. Containment was a viable, correct and, ultimately, successful strategy. The same options are not available this time. There will be no winners from a new Cold War with China.

Political leaders, policy-makers and academics routinely refer to development as an objective process of social change through the use of technical, value-free terms. Images of poverty and inequality are regularly presented as evidence of a world that exists ‘out there’ where development unfolds. This way of seeing reflects the value of scientific forms of knowledge but also sits in tension with the normative foundations of development that take European modernization and industrialization as the benchmark for comparison. The role images play in this process is often overlooked. This article argues that a dominant mode of visuality based on a Cartesian separation between subject and object, underpinning the ascendance of European hegemony and colonialism, aligns with the core premises of orthodox development discourse. An example of how visual representations of development matter is presented through images of Africa–China relations in western media sources. Using widely circulated images depicting China's impact on African development in western news media sources as an example of why visual politics matters for policy-making, the article examines how images play a role in legitimizing development planning by rendering associated forms of epistemological and structural violence ‘invisible to the viewer’.

While China and Russia's general policies towards the Responsibility to Protect (R2P) are similar, the two reveal nuanced differences in addressing specific emergencies. Both express support for the first two pillars of R2P while resisting coercive intervention under its aegis, as they share anxieties of domestic political security and concerns about their international image. Nonetheless, addressing cases like the Syrian crisis, Russian statements are more assertive and even aggressive while Chinese ones are usually vague and reactive. This article highlights the two states’ different tones through computer-assisted text analyses. It argues that diplomatic styles reflect Russian and Chinese perceptions of their own place in the evolving international order. Experiences in past decades create divergent reference points and status prospects for them, which leads to their different strategies in signalling Great Power status. As Beijing is optimistic about its status-rising prospects, it exercises more self-restraint in order to avoid external containments and is reluctant to act as an independent ‘spoiler’. Meanwhile, Moscow interprets its Great Power status more from a frame of ‘loss’ and therefore is inclined to adopt a sterner approach to signal its status. Although their policies complement each other on many occasions, there is nothing akin to a Sino–Russian ‘bloc’.

China has been a major market for elephant ivory for centuries. However, the Chinese government recently enacted bans on imports and exports of ivory (2015) and on the domestic ivory trade (2017). These bans appear to have come in response to intensive influence campaigns and public shaming from domestic and foreign activists, who cited declining elephant populations and highlighted China's role. However, this shaming-narrative is at odds with conventional wisdom regarding Chinese policy-making: China typically resists international pressures and its authoritarian government is thought to be largely insulated from domestic efforts by civil society groups. This article reconciles Beijing's ivory policy with these conventional beliefs about policy-making in China. I argue that the Chinese government saw unique benefits to banning the ivory trade, under growing international scrutiny, as doing so enhanced Chinese soft power while having very little impact on its sovereignty or development. Non-government organizations (NGOs) operating both inside and outside of China played a role as well: NGOs in China helped to shift Chinese public opinion towards favouring the bans, while those operating abroad led public relations efforts to publicize Chinese demand for ivory to foreign audiences. Efforts by the latter group of NGOs intensified pressure on the Chinese government to rein in the ivory market, while increasing the soft power benefits that banning ivory would bring to Beijing.

Read all our analysis on the Coronavirus Response

The coronavirus outbreak comes at a difficult time for China’s ruling party. A tumultuous 2019 saw the country fighting an economic slowdown coupled with an increasingly hostile international environment. As authorities take assertive steps to contain the virus, the emergency has - at least temporarily - disrupted global trade and supply chains, depressed asset prices and forced multinational businesses to make consequential decisions with limited information. 

Against this backdrop, panellists reflect on the country’s nascent economic transition from 2020 onward. What has been China’s progress towards a sustainable innovation-led economy so far? To what extent is the ruling party addressing growing concerns over job losses, wealth inequality and a lack of social mobility? And how are foreign investors responding to these developments in China?

Almost four years since it was established, the China-led Asian Infrastructure Investment Bank (AIIB) has approved 49 projects and proposed 28. The AIIB claims to be more efficient and less bureaucratic than traditional multilateral development banks (MDB’s) which has threatened the existing model of multilateral development finance. At the same time, China’s increased role in previously Western-led economic institutions, such as the WTO and IMF, has raised questions over the future of the international trade order. How will a rising China shape the international institutional order? Where are there opportunities for potential collaboration and what areas pose challenges? And how should other states and international organizations respond?

Attendance at this event is by invitation only. 

Video: Marianne Schneider-Petsinger and Dr Yu Jie discuss key themes from the research paper

Summary

• The underlying driver of the ongoing US–China trade war is a race for global technological dominance. President Trump has raised a number of issues regarding trade with China – including the US’s trade deficit with China and the naming of China as a currency manipulator. But at the heart of the ongoing tariff escalation are China’s policies and practices regarding forced technology transfer, intellectual property theft and non-market distortions.
• As China’s international influence has expanded it has always been unlikely that Beijing would continue to accept existing global standards and institutions established and widely practised by developed countries based on ‘the Washington Consensus’.
• China’s desire to be an alternative champion of technology standard-setting remains unfulfilled. Its ample innovation talent is a solid foundation in its quest for global technology supremacy but tightening controls over personal freedoms could undermine it and deter potential global partners.
• It is unclear if Chinese government interventions will achieve the technological self-sufficiency Beijing has long desired. China’s approach to macroeconomic management diverges significantly from that of the US and other real market economies, particularly in its policy towards nurturing innovation.
• Chinese actors are engaged in the globalization of technological innovation through exports and imports of high-tech goods and services; cross-border investments in technology companies and research and development (R&D) activities; cross-border R&D collaboration; and international techno-scientific research collaboration.
• While the Chinese state pushes domestic companies and research institutes to engage in the globalization of technological innovation, its interventions in the high-tech sector have caused uneasiness in the West.
• The current US response to its competition with China for technological supremacy, which leans towards decoupling, is unlikely to prove successful. The US has better chances of success if it focuses on America’s own competitiveness, works on common approaches to technology policy with like-minded partners around the globe and strengthens the international trading system.
• A technically sound screening mechanism of foreign investment can prevent normal cross-border collaboration in technological innovation from being misused by geopolitical rival superpowers.

At face value, recent years have seen a deepening in Sino-Russian cooperation, from energy agreements, to the recent Huawei-MTS deal developing a 5G network in Russia. Ever larger-in-scale joint military exercises add to fears by some that the 'axis of convenience' is now a more genuine – and threatening – partnership.

This workshop will offer a sober assessment of the latest developments in Sino-Russian relations, shedding light on the underpinnings and practical realities of the relationship as well as on the long-term challenges of upholding cooperation.

The panel will discuss the different and potentially diverging interpretations of contemporary Sino-Russian relations as well as the implications for the rules-based international order.

This event is co-organized by the Chatham House Russia and Eurasia Programme and the University of Exeter and is supported by the British International Studies Association.

Attendance at this event is by invitation only. 

In response to the changing geopolitical landscape in Asia, both China and the United States attempt to alter the regional order in their own favour, both in the economic and security realms. This article shows how diverging views on future arrangements are leading to strategic shifts and increasing tension between these two Great Powers. As part of its quest for Great-Power status, China has been actively pushing its regional initiatives such as the Belt and Road Initiative (BRI) and the Asian Infrastructure Investment Bank (AIIB), as well as adopting assertive security policies towards its neighbours. In contrast, in order to counter China's growing influence America's regional strategy is undergoing a subtle shift from ‘rebalancing to Asia’ to focusing on the ‘Indo-Pacific’ region. However, amid an intensifying trade war and other challenges facing the region, China has chosen to moderate its proactive foreign policy-orientation in the past few years. In particular, China has made attempts to downplay its domestic rhetoric, rebuild strategic relationship with India and Japan, and to reassure ASEAN states in the South China Sea. In response to the Indo-Pacific strategy, it would be more effective for China to articulate a more inclusive regional vision and promote an institutional framework that also accommodates a US presence in the region.

The ‘free and open Indo-Pacific’ (FOIP) strategy, actively promoted by the United States with support from its allies and partners, is a significant geopolitical response to China's growing power and expanding influence in Asia and beyond. Beijing has adopted various new strategies to cope with the challenges related to FOIP. One of these strategies is to secure a robust relationship with south-east Asia in order to make these regional states either neutral to or less supportive of the Indo-Pacific vision. In addition to economic statecraft and soft power, Beijing believes that it can also tap into the domain of non-traditional security (NTS) to strengthen relations with this region to position itself better in the intensifying regional geopolitical competition. The article addresses the following question: what is the impact of China's NTS cooperation with south-east Asia on Beijing's geopolitical rivalry with other major powers in the Indo-Pacific region? The article argues that China's NTS cooperation with south-east Asian countries may help China maintain its geopolitical standing in the region, but it is unlikely to lead to any dramatic increase of China's strategic influence in the region. This essentially means that Beijing may be able to prevent ASEAN or most ASEAN member states from lending substantive and strong support to the Indo-Pacific construct, but it will not be able to stop ASEAN states from supporting some elements of the FOIP.

Japan's primary objective of the ‘free and open Indo-Pacific’ (FOIP) strategy is to shape and consolidate regional order in the Indo-Pacific region based on the existing rules-based international order. The concept initially aimed to achieve two different objectives—shaping a regional order in the Indo-Pacific and ensuring the defence of Japan; however, Japan has gradually shifted its strategic focus onto the former, separating national defence from the FOIP concept, which reflects a change in the degree of its commitment to the two objectives. On the one hand, as its overall security strategy, Japan has determined to steadily enhance its national defence by increasing its own defence capabilities and strengthening the US–Japan alliance, while transforming its partnerships with like-minded states, such as Australia and India, into a diplomatic, and potentially military, alignment. This has been brought about by shifts in the regional balance of power, particularly the rise of China and the relative decline of the United States. On the other hand, as part of its FOIP strategy, Japan's attempts to build a new regional order in the Indo-Pacific region aim to defend the existing rules-based order established by the United States from challengers, particularly China. Yet, given the strategic uncertainty over Japan's international coalition-building efforts to create a new regional order, Japan has made its approach flexible; Tokyo is using its ambiguous FOIP concept to gauge other states' responses, understand their perspectives, and change its strategic emphases accordingly—so-called ‘tactical hedging’. Japan has pursued similar means to achieve the two key objectives. Nevertheless, the country's core interest, the defence of Japan, is more imperative than building a regional order in the Indo-Pacific region, and Japan faces different types of challenges in the future.

As a geographical concept, ‘Indo-Pacific’ has existed for decades. As a political and strategic concept, it has since 2010 gradually become established in the foreign policy lexicon of some countries, especially Australia, India, Japan and the United States. However, China seems to be reluctant to identify itself as part of the Indo-Pacific; Chinese leaders believe that the US-led Indo-Pacific strategy aims to contain China's rise. While the battle between the two geographical concepts ‘Indo-Pacific’ and ‘Asia–Pacific’ may be fairly easily settled in the future, US–China strategic competition has just begun. Will the Indo-Pacific become a battlefield for US–China rivalry? How will China cope with the US ‘free and open Indo-Pacific’ (FOIP) strategy? How will other regional actors respond to the US–China strategic competition in the Indo-Pacific? What are the strategic implications of the ‘Indo-Pacific’ concept for regional order transformation? How will the Indo-Pacific be institutionalized, economically, politically and strategically? This article introduces the January 2020 special issue of International Affairs, which aims to address those questions, using both country-specific and regional perspectives. Seven articles focus on the policy responses of major players (Australia, China, India, Indonesia, Japan and ASEAN) to the US FOIP strategy and related US–China rivalry in the region. A further three articles examine the profound implications of Indo-Pacific dynamics for regional institution-building and for geopolitical and geo-economic architecture.

Read all our analysis on the Coronavirus Response

The coronavirus outbreak comes at a difficult time for China’s ruling party. A tumultuous 2019 saw the country fighting an economic slowdown coupled with an increasingly hostile international environment. As authorities take assertive steps to contain the virus, the emergency has - at least temporarily - disrupted global trade and supply chains, depressed asset prices and forced multinational businesses to make consequential decisions with limited information. 

Against this backdrop, panellists reflect on the country’s nascent economic transition from 2020 onward. What has been China’s progress towards a sustainable innovation-led economy so far? To what extent is the ruling party addressing growing concerns over job losses, wealth inequality and a lack of social mobility? And how are foreign investors responding to these developments in China?

The coronavirus outbreak in China poses a tremendous test for Beijing. Beyond the immediate public health crisis, the Chinese Communist Party faces a stuttering economy, growing public anger and distrust, and a potentially heavy blow to its global reputation.

The hesitant early response to the outbreak sheds light on the way the Chinese bureaucracy approaches crises at a time when the party leadership is tightening control at almost all levels of society. At first, officials in Wuhan attempted to censor online discussions of the virus. This changed only after President Xi Jinping’s call for a much more robust approach was followed by a sudden increase in the state media coverage of the outbreak. There is no doubt that Xi’s intervention will greatly speed up the response to the crisis, which should be welcomed.

Despite China’s experience with the SARS epidemic between 2002 and 2004, the sluggish reaction by officials in Wuhan should not have come as a surprise. The tendency among bureaucrats to play down crises is deeply entrenched. And, ironically, the party leadership’s recent push for greater bureaucratic accountability and its promise of stiffer punishment for those who take a 'do little' approach have also contributed to the habit of covering up disasters.

Xi has launched an ambitious programme to reform the governance of the Communist Party and re-centralize political control. This has reinforced the tendency of officials to avoid making important decisions and instead to wait for instructions from the party leadership.

For decades, local governments have made things happen in China. But with tighter regulation of lower-level bureaucrats, civil servants across the system now seem less ready, and able, to provide their input, making ineffective and even mistaken policy more likely.

Moreover, the coronavirus outbreak could not have happened at a worse time. Last year was tumultuous and saw China fighting an economic slowdown while also dealing with an increasingly hostile international environment. Now, as the authorities take steps to contain the disease, economic activity has come to a near standstill, with public transport curbed and restaurants and entertainment venues shuttered.

This contrasts with SARS, when double-digit growth in gross domestic product enabled Beijing to raise government expenditure to tackle the outbreak. Today, the Chinese economy is running into some of the most difficult challenges it has faced since the global financial crisis.

In response to the slowdown in growth, Beijing has adopted loose fiscal policy, with an emphasis on public investment. It also continues to push big banks to cut interest rates for individual borrowers and small businesses which were already suffering from the effects of the trade war with the US before the coronavirus struck.

The outbreak should give new impetus to governments, not least those that have close economic ties with China. Being a great power with ambitions for global leadership, as well as domestic reform, is not easy. Even without multi-party elections, it involves increasing, and often uncomfortable, scrutiny. As President Xi himself has put it: the road is long and the task is weighty.

This article was originally published in the Financial Times.

This event is part of the Inaugural Virtual Roundtable Series on the US, Americas and the State of the World and will take place virtually only. Participants should not come to Chatham House for these events.

Only a few months into 2020, the coronavirus pandemic has presented a huge challenge for China’s ruling party against an already tumultuous 12 months of economic slowdown coupled with an increasingly hostile international environment. The crisis looks set to worsen a deteriorating relationship between the US and China as the two countries battle to avoid further economic ramifications. It has also undermined President Xi Jinping and the Chinese Communist Party’s domestic political legitimacy and economic growth.

The panellists will examine the wider geopolitical fallout of the coronavirus pandemic and discuss China’s future economic planning. How will the COVID-19 outbreak further strain the US-China relationship? What effect will this have on global trade and vulnerable supply chains at a time when cooperation is needed more than ever? And to what extent is the ruling party addressing growing concerns over job losses, wealth inequality and a lack of social mobility?

This event is only open to Major Corporate Member and Partner organizations and selected giving circles of Chatham House. If you'd like to attend, please RSVP to Linda Bedford.

As the COVID-19 crisis roars on, so have debates about China’s role in it. Based on what is known, it is clear that some Chinese officials made a major error in late December and early January, when they tried to prevent disclosures of the coronavirus outbreak in Wuhan, even silencing healthcare workers who tried to sound the alarm.

China’s leaders will have to live with these mistakes, even if they succeed in resolving the crisis and adopting adequate measures to prevent a future outbreak. What is less clear is why other countries think it is in their interest to keep referring to China’s initial errors, rather than working toward solutions.

For many governments, naming and shaming China appears to be a ploy to divert attention from their own lack of preparedness. Equally concerning is the growing criticism of the World Health Organization (WHO), not least by Donald Trump who has attacked the organization - and threatens to withdraw US funding - for supposedly failing to hold the Chinese government to account.

Unhelpful and dangerous

At a time when the top global priority should be to organize a comprehensive coordinated response to the dual health and economic crises unleashed by the coronavirus, this blame game is not just unhelpful but dangerous.

Globally and at the country level, we all desperately need to do everything possible to accelerate the development of a safe and effective vaccine, while in the meantime stepping up collective efforts to deploy the diagnostic and therapeutic tools necessary to keep the health crisis under control.

Given there is no other global health organization with the capacity to confront the pandemic, the WHO will remain at the center of the response, whether certain political leaders like it or not.

Having dealt with the WHO to a modest degree during my time as chairman of the UK’s independent Review on Antimicrobial Resistance (AMR), I can say that it is similar to most large, bureaucratic international organizations.

Like the International Monetary Fund (IMF), the World Bank, and the United Nations, it is not especially dynamic or inclined to think outside the box. But rather than sniping at these organizations from the sidelines, we should be working to improve them.

In the current crisis, we all should be doing everything we can to help both the WHO and the IMF to play an effective, leading role in the global response. As I have argued before, the IMF should expand the scope of its annual Article IV assessments to include national public-health systems, given that these are critical determinants in a country’s ability to prevent or at least manage a crisis like the one we are now experiencing.

I have even raised this idea with IMF officials themselves, only to be told that such reporting falls outside their remit because they lack the relevant expertise. That answer was not good enough then, and it definitely isn’t good enough now.

If the IMF lacks the expertise to assess public health systems, it should acquire it. As the COVID-19 crisis makes abundantly clear, there is no useful distinction to be made between health and finance. The two policy domains are deeply interconnected, and should be treated as such.

In thinking about an international response to today’s health and economic emergency, the obvious analogy is the 2008 global financial crisis which started with an unsustainable US housing bubble, fed by foreign savings owing to the lack of domestic savings in the United States.

When the bubble finally burst, many other countries sustained more harm than the US did, just as the COVID-19 pandemic has hit some countries much harder than it hit China.

And yet not many countries around the world sought to single out the US for presiding over a massively destructive housing bubble, even though the scars from that previous crisis are still visible. On the contrary, many welcomed the US economy’s return to sustained growth in recent years, because a strong US economy benefits the rest of the world.

So, rather than applying a double standard and fixating on China’s undoubtedly large errors, we would do better to consider what China can teach us. Specifically, we should be focused on better understanding the technologies and diagnostic techniques that China used to keep its - apparent - death toll so low compared to other countries, and to restart parts of its economy within weeks of the height of the outbreak.

And for our own sakes, we also should be considering what policies China could adopt to put itself back on a path toward 6% annual growth, because the Chinese economy inevitably will play a significant role in the global recovery.

If China’s post-pandemic growth model makes good on its leaders’ efforts in recent years to boost domestic consumption and imports from the rest of the world, we will all be better off.

This article was originally published in Project Syndicate

So far, there has been a noticeable worsening of relations that had already soured in recent years – the latest step being President Donald Trump’s suspension of US funding for the World Health Organization (WHO) in response to accusations of Chinese interference in its operations.

Should the world now simply prepare for a period of intense and extended hostility? As director of a policy institute founded 100 years ago in the shadow of the First World War, I believe we must do all in our power to avoid a return of the global strategic rivalries that blighted the 20th century.

Deepening suspicions

Of course, the outcome does not lie only in the hands of the US and Europe. In the 1930s, as much as they wanted to avoid another great war, British and French leaders were forced to respond to Germany’s aggression in central Europe. In the late 1940s, America’s instinct to disentangle itself from war-ravaged Europe was quickly tempered by the realization that the Soviet Union would impose or infiltrate Communist control as far into Europe as possible.

Today, those who warned that China - a one-party, surveillance state with a power-centralising leader - could never be treated as a global stakeholder feel vindicated. They see in COVID-19 an opportunity to harden policies towards China, starting by blocking all Chinese investment into 5G infrastructure and breaking international dependence on Chinese supply chains.

They can point to the fact that Chinese Communist Party officials in Wuhan initially prioritised sustaining economic growth and supressed reports about COVID-19’s capacity for human-to-human transmission, epitomised by their treatment of Dr Li Wenliang. They can highlight how Beijing’s obsession with denying Taiwan a voice in the WHO prevented Taiwanese input into the early analysis of the crisis. They can highlight the ways in which Beijing has instrumentalised its medical support for coronavirus-afflicted countries for diplomatic gain.

For their part, those in China who believed the US and Europe would never allow China’s return as a regional and world power see this criticism as further evidence. They can point to comments about this being the ‘Chinese virus’, a leaked biological weapon or China’s ‘Chernobyl moment’. ‘Wolf warrior’ Chinese diplomats have sought to outdo each other by challenging narratives about COVID-19, while propagating disinformation about the origins of the virus.

There are major risks if this blame game escalates, as it could in the lead-up to a fraught US presidential election. First, consciously uncoupling the US economically from China will make the post-coronavirus recovery that much harder. China already accounts for nearly 20% of world GDP but, unlike after the global financial crisis in 2008, it is fast becoming the world’s leading consumer market. Its financial stimulus measures need to be closely coordinated with the G7 and through the G20.

Second, Chinese scientists were the first to uncover the genetic code of the virus and shared it with the WHO as early as January 12, enabling the roll-out of effective testing around the world. They are now involved in the global search for a vaccine alongside American and European counterparts. While the Chinese government will remain a legitimate target for criticism, Chinese citizens and companies will contribute to many of the most important technical breakthroughs this century.

Third, if COVID-19 creates a long-term schism between China and the US, with Europeans caught on its edge, this could do deep damage to world order. China may become a less willing partner in lowering global greenhouse gas emissions and sharing renewable energy technologies; in helping African and other developing countries grow sustainably; and in helping to build a more resilient global health infrastructure.

Getting the balance right

But the COVID-19 crisis can also be the hinge point to a more coherent and self-interested transatlantic approach to China, one whose motto should be ‘beware but engage’. There should indeed be limits on state-backed Chinese investment in strategic US and European economic sectors, just as China limits Western access to its market. But the goal should be to lower barriers to trade and investment over time on a mutually beneficial and transparent basis, not to recreate an economic Cold War.

Chinese human rights violations, at home and abroad, should be called out. The dissemination of Chinese systems of citizen surveillance, which will be more popular in a post-coronavirus world, should be monitored and contested with US and European alternatives. And the extent of Chinese exports’ access to international markets should be conditional on China improving its phytosanitary standards - which protect humans, animals, and plants from diseases, pests, or contaminants - and strictly regulating unhygienic wet markets.

But to go further and try to make disengagement the dominant transatlantic policy as COVID-19 subsides will not only divide Europe and America. It will also contribute to a self-fulfilling prophecy; in which a resentful China grows apart from the US and Europe during a period where they must work together.

Given that it will likely be the world’s largest economy in 2030, how the US and Europe manage their relations with China after this crisis is a question at least as seminal as the one they faced after 1945 with the Soviet Union. In the ensuing years, the Soviet Union became a military superpower and competitor, but not an economic one. Containment was a viable, correct and, ultimately, successful strategy. The same options are not available this time. There will be no winners from a new Cold War with China.

The COVID-19 crisis has accelerated geopolitical tensions that, in part, have arisen from US-China tensions. At a time when the world needs strong and collective leadership to fight the coronavirus, both countries have been locked in a battle of words characterized by escalating hostility, polarizing narratives, blame and misinformation. Caught in the crossfire, many people of Chinese descent across differing countries have reported an increase in xenophobic attacks.

Middle powers such as the UK and Australia have swerved between recognition of the global collaboration needed to solve this pandemic and calls for China to be held ‘accountable’ for its initial response. Others such, as France and Japan, have been trying to foster international cooperation. 

Against this context, speakers will discuss China’s response to the crisis, including the initial delay and Beijing’s later containment strategies. How do we best assess the delay amidst all the heated rhetoric? What was the response of people within China to the measures? Does COVID-19 mark a point of no return for US-China relations? How might this impact on relations between US allies and China? And what kind of China will emerge from this current crisis?