China’s adherence to the rules-based international system is selective, prioritizing certain rules in favour of others. States supportive of that ‘system’ – or, as some argue, systems[1] – should identify areas of mutual strategic interest so that they can draw China further into the global rules-based order and leverage China as a constructive player that potentially also contributes to improvements in such areas. This is particularly apposite at a time when the US is in retreat from multilateralism and Russia seems bent on disrupting the rules-based international order.

Supportive player

There are many reasons for actively engaging with China on mutual areas of interest. China is a committed multilateralist in many areas, recognizing that often international cooperation and frameworks hold the key to its domestic problems, for example in the fields of environmental sustainability and financial regulation.

China’s economic power is valuable in upholding international institutions: China is the UN’s third-largest donor (after the US and Japan) at a time when the UN is facing budgetary shortfalls. China is also the second-highest contributor to the UN peacekeeping budget, and the largest contributor of peacekeeping forces among the five permanent members of the UN Security Council.

China also has a valuable role to play in the settlement of international disputes over trade and investment. China is a big supporter of the World Trade Organization (WTO)’s dispute settlement mechanism, and one of its most active participants;[2] China is currently playing an active role in negotiations to save the WTO’s appellate mechanism from folding in the wake of the US’s refusal to nominate new judges.

The last 15 years have also seen a major shift in Chinese attitudes to investment arbitration, from a general suspicion and limitation of arbitration rights to broad acceptance and incorporation of such rights in China’s trade and investment treaties. China is actively engaged in multilateral negotiations through the UN Commission on International Trade Law (UNCITRAL) on reforms to investor–state dispute settlement.

China has shown leadership on global climate change diplomacy, urging nations to remain committed to the Paris Agreement in the wake of the US decision to pull out, and has been an important interlocutor with the UK and the EU on these issues. As a strong supporter of the Paris Agreement, but also as the world’s top emitter of carbon dioxide, China has a crucial role to play in pushing forward implementation of the Paris targets. Despite its high emissions, China remains one of the few major economies on track to meet its targets,[3] giving it greater leverage to peer review other parties’ efforts.

A recent report by the UK parliament’s Foreign Affairs Committee (FAC), on China and the rules-based international order, noted that where a body of trust and goodwill is developed with China, there is the possibility of discovering interests that coincide and the ability to work together on issues mutually regarded as of global importance. The report refers to a number of success stories from UK partnership with China in multilateral forums, including in counterproliferation and global health.[4]

Developing areas of global governance

As well as working with the current system, China is increasingly involved in the shaping of newer areas of international law – whether it be submissions to the International Tribunal for the Law of the Sea (ITLOS) on procedural rules for the emerging deep-sea mining regime or pitching for a greater role in Arctic governance.[5]

This enthusiasm should be harnessed to promote the international rule of law, but at the same time there needs to be recognition of the strategic goals that drive China’s engagement. China’s interest in the Arctic, while including the desire to protect its ecology and environment, is also about access to marine resources, as well as about the Arctic’s strategic potential for China’s military.

China’s submissions to ITLOS on the rules of procedure for deep-sea mining are constructive, but also reflect an ambition to secure first-mover advantage when commercial mining eventually takes place. Like other major powers working in this policy area, China’s actions are guided by self-interest, but that doesn’t mean its goals can’t be pursued through multilateral rules.

China is also interested in creating new international structures and instruments that further its strategic aims. For example, with Russia (through the Shanghai Cooperation Organisation) it has proposed an International Code of Conduct for Information Security in the UN.[6]

China is also pondering an array of options for dispute-resolution mechanisms for its Belt and Road projects, including the possibility of an Asian version of the international Convention on the Settlement of Investment Disputes, which might sit under the auspices of the Asian Infrastructure Investment Bank (AIIB).[7]

The creation of new instruments and institutions need not be a threat to the rules-based international order in itself. We have already seen a combination of the creation of parallel complementary regimes alongside the reform of existing institutions, for example in development financing through the AIIB or the New Development Bank (often referred to as the ‘BRICS Bank’); these two banks are relatively conventionally structured along the lines of Western-dominated institutions, albeit with greater Chinese control. Based on these examples, selective adaptation seems more likely than a hostile ‘Eastphalian’ takeover.[8]

Risks

There is, however, a real risk that in certain areas China may promote a rival authoritarian model of governance, assisted by an opportunistic convergence with Russia on issues such as human rights, development and internet governance. In areas where China’s core interests clash with those of the rules-based international order, China has shown itself to be unbending, as in its refusal to abide by the July 2016 decision of the Permanent Court of Arbitration in its dispute with the Philippines over the South China Sea.[9]

China is becoming more assertive at the UN, but while it seeks to project itself there as a responsible emerging global leader, it is promoting a vision that weakens international norms of human rights, transparency and accountability,[10] while also carrying out practices domestically that raise serious human rights concerns (not least the detention of hundreds of thousands of Uighurs in re-education camps in Xinjiang).[11]

China’s increased dominance geographically and geopolitically through its Belt and Road infrastructure projects carries with it a number of social and economic risks, including smaller states becoming trapped in unsustainable financial debts to China.

But at a recent Chatham House conference on Asia and international law, participants highlighted the limitations on how far China can shape an alternative governance model.[12] China currently lacks soft power, cultural power and language power, all of which are needed in order to embed an alternative model abroad. China also currently lacks capacity and confidence to build coalitions with other states in the UN.

Where it has tried to get buy-in from the international community for its new institutions, such as the China International Commercial Court (CICC) announced in July 2018, there has been scepticism about the standards to be applied.[13] Unless the court can demonstrate sufficient due process, international parties are likely to prefer other centres with a strong reputation for upholding the rule of law, such as those in London, Dubai and Singapore.

Where China does promote its own governance model at the expense of the rules-based international order, states are starting to push back, often in concert. EU member states so far have adopted a joined-up approach to the Belt and Road Initiative. With the exception of Italy, they have refused to sign a Memorandum of Understanding on participation unless China provides much greater transparency on its compliance with international standards.

The EU also recently presented a coordinated response to China on the situation in Xinjiang.[14] Similarly, members of the so-called ‘Five Eyes’ intelligence-sharing alliance (comprising Australia, Canada, New Zealand, the UK and the US) have acted together in relation to certain incidents of cyber interference attributed to China.[15]

There are also signs of pushback from smaller states closer to home in relation to challenges to national sovereignty, debt diplomacy and financial viability arising from Belt and Road projects. The Sri Lankan government recently reversed the award of a $300 million housing deal to China, instead opting for a joint venture with an Indian company.

China has been downscaling its investments as a way to counter some of the backlash it has received: the most recent Belt and Road summit put forward a more modest set of aspirations. This suggests that there is some scope for states to stand up to China and use leverage to secure better deals.

Many international institutions have been Western-dominated for years;[16] China, together with many emerging and middle powers, has felt for some time that the international architecture does not reflect the world we live in. Given that context, states that champion the rules-based international order should acknowledge China’s desire to update the international order to reflect greater multipolarity, globalization and technological change, while being clear-eyed about their engagement with China. This involves investing in a proper understanding of China and how it works.[17]

Where possible, cooperation with China should lead to outcomes that are backed up by international standards and transparency. The above-mentioned FAC report cites evidence that the UK’s support, and that of other developed countries, had a positive impact in shaping the governance and standards of the AIIB.[18] China has brought in international experts to advise on disputes before the CIIC, which may reassure would-be litigants.

China’s relationship with the rules-based international order needs to be assessed pragmatically and dynamically. China can be a valuable partner in many areas where its objectives are closely aligned with those of the international community – from trade to climate change to peacekeeping.

But where the country’s core interests are at odds with those of the wider international community, an increasingly confident China will strongly resist pressure, including on the South China Sea and human rights. In these areas, states supportive of international law can most powerfully push back through alliances and by ensuring that their own core values are not compromised in the interests of economic benefits.

Notes

[1] Chalmers, M. (2019), Which Rules? Why There is No Single ‘Rules-Based International System’, RUSI Occasional Paper, April 2019, London: Royal United Services Institute, https://rusi.org/occasional-papers/Which-Rules-Why-There-Is-No-Single-Rules-Based-International-System.

[2] See, for example, Moynihan, H. (2017), China’s Evolving Approach to International Dispute Settlement, Briefing, London: Royal Institute of International Affairs, https://www.chathamhouse.org/publication/chinas-evolving-approach-international-dispute-settlement.

[3] UN Environment (2018), Emissions Gap Report 2018, p. XVII, https://www.unenvironment.org/resources/emissions-gap-report-2018.

[4] House of Commons Foreign Affairs Committee (2019), China and the Rules-Based International System: Sixteenth Report of Session 2017–19, p. 32, https://publications.parliament.uk/pa/cm201719/cmselect/cmfaff/612/612.pdf.

[5] Moynihan, H. (2018), ‘China Expands Its Global Governance Ambitions in the Arctic’, Expert Comment, 15 October 2018, https://www.chathamhouse.org/expert/comment/china-expands-its-global-governance-ambitions-arctic.

[6] Updated version proposed 9 January 2015.

[7] Moynihan, H. (2018), ‘Exploring Public International Law Issues with Chinese Scholars – Part Four’, Meeting Summary, 3 June 2018, https://www.chathamhouse.org/publication/exploring-public-international-law-issues-chinese-scholars-part-four.

[8] Chatham House (2019, forthcoming, ‘Security and Prosperity in the Asia-Pacific: The Role of International Law’, conference summary, https://www.chathamhouse.org/event/security-and-prosperity-asia-pacific-role-international-law.

[9] Permanent Court of Arbitration Case No. 2013-19 (Philippines v China), Award of 12 July 2016, https://pca-cpa.org/wp-content/uploads/sites/6/2016/07/PH-CN-20160712-Award.pdf.

[10] Piccone, T. (2018), China’s Long Game on Human Rights at the United Nations, Washington, DC: Brookings Institution, https://www.brookings.edu/wp-content/uploads/2018/09/FP_20181009_china_human_rights.pdf.

[11] Wye, R. (2018), ‘‘The entire Uyghur population is seemingly being treated as suspect’: China’s persecution of its Muslim minority’, LSE Religion and Global Society blog, 18 September 2018, https://blogs.lse.ac.uk/religionglobalsociety/2018/09/the-entire-uyghur-population-is-seemingly-being-treated-as-suspect-chinas-persecution-of-its-muslim-minority/.

[12] Chatham House (2019, forthcoming, ‘Security and Prosperity in the Asia-Pacific: The Role of International Law’.

[13] Walters, M. (2018), ‘Jury is out over China’s new commercial court, say lawyers’, Law Society Gazette, 1 November 2018, https://www.lawgazette.co.uk/law/jury-is-out-over-chinas-new-commercial-court-say-lawyers/5068125.article.

[14] The Economist (2019), ‘Hope remains for Western solidarity. Look at embassies in Beijing’, 17 April 2019, https://www.economist.com/china/2019/04/20/hope-remains-for-western-solidarity-look-at-embassies-in-beijing.

[15] In December 2018, the Five Eyes attributed the activities of a Chinese cyber espionage group targeting intellectual property and sensitive commercial property to China’s Ministry of State Security.

[16] Roberts, A. (2017), Is International Law International?, Oxford: Oxford University Press.

[17] Parton, C. (2019), China–UK Relations: Where to Draw the Border Between Influence and Interference?, RUSI Occasional Paper, February 2019, London: Royal United Services Institute, p. 30, https://rusi.org/publication/occasional-papers/china-uk-relations-where-draw-border-between-influence-and.

[18] House of Commons Foreign Affairs Committee (2019), China and the Rules-Based International System, p. 15.

This essay was produced for the 2019 edition of Chatham House Expert Perspectives – our annual survey of risks and opportunities in global affairs – in which our researchers identify areas where the current sets of rules, institutions and mechanisms for peaceful international cooperation are falling short, and present ideas for reform and modernization.

Three private roundtable meetings were convened in the first quarter of 2019, with the aim of generating informed and constructive new thinking on policy options and reforms that could help Sudan build a more economically prosperous, stable and inclusive nation. The roundtables were held under the Chatham House Rule.

The project sought to offer a neutral space for discussion to policymakers and influencers from a broad range of backgrounds: Sudanese government officials, opposition figures, economists, experts on Sudan’s political economy and governance, civil society figures, representatives of international financial institutions, and other international policymakers.

This paper draws together the key themes and findings from each of the three roundtables, ranging from broad structural economic issues to sector-specific priority interventions. It presents options and recommendations for Sudanese leaders, including the transitional government, in support of building a more economically prosperous, peaceful and inclusive nation.

Africa’s media landscape has undergone a significant change over the last decade as digitalization and new forms of media consumption have weakened state control of information. Social media has provided an opportunity for African citizens and journalists to take agency over how the continent is presented to the wider world, and many emerging African voices bring clarity to this digitally disrupted marketplace. But significant external support is required to make these efforts sustainable.  

There is no one ‘African’ story. African media remains as diverse as the 55 states in the African Union, with each national media ecosystem dependent on patterns of culture and governance - most importantly the power gap between those in leadership and their voters.

Journalists from Egypt, Eritrea and Cameroon - states in the 2019 global top 10 for putting their colleagues in prison - have different perspectives from those in other more liberal African countries.

This is most visible in traditional media where a business model based on advertising revenue has allowed African media houses to grow. But it is susceptible to manipulation from state and business actors holding outlets to ransom in exchange for editorial influence or control – a particularly acute problem in states where business and political elites are closely intertwined, and a middle-class consumer base to fund market-driven advertising has yet to develop.

Those African countries with relatively open borders, stronger passports and a more vibrant civil society also tend to have a more diverse and vibrant media environment. Open borders allow for easier movement, granting journalists the opportunity to travel, benchmark and participate in exchange programs.

The power of online networking

The advent of the social media age has begun to disrupt the links between governance and media health, as the large operations required by ‘serious’ media organizations have been replaced by mobile phone cameras and social media timelines.

Many African journalists are at the forefront of this innovation, unrestricted by historical perceptions of how journalism should be presented, and free to disrupt and change the established narratives to better engage with their ever-growing audiences.

And, far from replacing journalism, social media has actively empowered African journalists and media professionals. Instead of acting as sources for international media outlets as in the past, African journalists can publish their work on their own platforms, enabling greater ownership of how issues in their localities are globally framed. This local voice is often the key to avoiding the endemic oversimplifications and generalisations that have coloured much external coverage of the continent.

Obviously, these changes bring risks. Individual uploaders are largely free to publish what they like, and misinformation can - and often has - lead to devastating consequences, evident in recent violence across central Mali, South Africa and the middle belt of Nigeria.

But journalists on the African continent have an increasingly important role in preventing the spread of misinformation, not only as purveyors of news but also as fact-checkers, able to discern the difference between valid opinion and dubious rhetoric on social media, while new pan-African digital networks and discussion groups enable journalists to share knowledge, expertise, and story ideas, or quickly verify information from across the continent.

It is now possible to quickly find authentic voices for TV, radio or online commentary through digital platforms, present on the ground and able to speak with real authority. Many online networks also include Africa-focused journalists from outside the continent, and any biased or incorrect coverage of the African continent can be ‘called out’ and heavily critiqued, with challenges shared and solutions generated. While journalists remain independent, their working practices and professional standards are being shaped by the discourse in the groups like never before.

Online networking has also exposed the existence of lingering cultural differences between journalists of different national backgrounds, such as a hesitancy to discuss sensitive issues – the health of leaders for instance – for fear of being targeted by the authorities, or the level to which government statements are uncritically accepted.

While journalists search for truth, how they go about it is still very dependent on the state of democracy in their country. Though the cross-fertilisation of best practices and critical scrutiny can only improve the quality of journalism on the continent, in many places there remains a long way to go.

Drive for better resources

Across the world, digital media has struggled to create models which can provide news free at the point of access while also successfully monetizing content. This is even more palpable on the African continent, as the subscription-based models employed as a remedy elsewhere are not feasible on such a large scale in countries without a well-established middle-class.

African media needs resources to keep operating at a time when revenue is dwindling, and talented journalists are decamping to join the marketing, communication and sales sectors in search of better wages. Structures to support more in-depth investigative journalism are vital in Africa because that seems to be the only thing those in power still truly fear.

This means more training opportunities, fellowships, and exchange programs to allow the exchange of ideas and expertise. And, as social media has given a platform to talented local voices from across Africa, then an international community which truly wants to understand the nuances of the continent must hire them.   

The 2007-08 financial crisis wreaked havoc on the lives of millions of people across the globe, and upended the faith of many in the prevailing economic system, with many countries still recovering a decade on.

Drawing on extensive research in his new book, Narrative Economics: How Stories Go Viral and Drive Major Economic Events, Professor Shiller will draw on a rich array of historical examples and data and outline a new way to think about economic change, and the narratives that shape it, to provide answers to questions such as whether lessons have been learned since the last financial crisis, are the same dislocations likely to occur again and what toolkits, if any, are there for anticipating the next financial crisis or recession?

Attendance at this event is by invitation only.

Two December meetings between Presidents Vladimir Putin and Alexander Lukashenka failed to deliver Moscow’s hopes of securing Minsk’s acceptance of closer alignment between Russia and Belarus.

Over the past year, relations between Belarus and Russia have been under unprecedented strain as Moscow has tried to encourage Minsk to sign up to a different format of relations designed to keep Belarus firmly in a Russian orbit. Details of the negotiations have remained secret, yet issues on the table appear to include unification of tax and customs systems, a common energy regulator and joint governing bodies.

The Kremlin believes that Belarus needs to deliver more in return for Russia’s continued economic support, worth around $10 billion per year. In December 2018, it issued an ultimatum: Belarus would only continue to receive a discounted price for oil and gas and enjoy preferential access to the Russian market if it agreed to reanimate the largely dormant 1999 Union Treaty that called for the unification of Belarus with Russia.

During 2019, frantic work took place on both sides to prepare a detailed framework for achieving deeper integration between the two countries. This did not succeed in overcoming a set of long-standing issues related to economic relations.

To step up pressure, the Russian prime minister, Dmitri Medvedev, signalled in early December that Russia would withhold economic privileges for Belarus pending full implementation of 30 integration road maps that he claimed had already been agreed. To the alarm of Minsk, he also suggested that discussion of a 31st roadmap would follow to include the creation of a single currency and supranational institutions. The Belarusian authorities view this level of integration as a threat to national sovereignty.

On the surface, Belarus’ negotiating position is weak. By resisting market reforms that could have diversified imports and exports, Lukashenka has instead kept the economy tied to Russia; 40% of Belarusian exports go to Russia. In addition, Russia has decreased its reliance on imports from Belarus as part of a broad policy of import substitution.

Raising the gas price will deprive Belarusian companies of their comparative advantage.  Approximately 90% of Belarus’s electricity and heat is generated by natural gas imported from Russia at below market prices. Petroleum products refined from Russian crude oil that is supplied duty-free to Belarus account for the largest source of the country’s export earnings.

Minsk fears that the current oil taxation reform in Russia could cause Belarus losses of up to $9 billion by 2024 as a result of higher prices for Russian oil and the loss of export duties. Economic growth slowed from 3% in 2018 to just over 1% in 2019 and could fall further if Russia does not grant concessions on the oil price.

The country’s high level of public debt denominated in foreign currency makes the need to find cash more urgent and exacerbates the Russian pressure. Russia is Belarus’ biggest creditor, accounting for 38% of state debt.

However, Lukashenka is a master of negotiation with the Kremlin, with a talent for turning weakness into strength.

First, by eliminating political competition in Belarus, he has given Putin no option but to deal with him personally. Second, he understands that Moscow needs to present integration between the two countries as voluntary and does not want to use economic sanctions or other tools of persuasion that could destabilize Belarus. Third, he knows that there is no consensus in Moscow on creating a single currency. Unification of the tax systems would also be problematic because of their different structures. If these measures were implemented, Moscow could end up paying much larger subsidies to keep Belarus stable.

Minsk is therefore likely to pursue three options: dragging out the negotiations with Moscow, while continuing to declare its commitment to closer union with Russia; seeking alternative sources of energy and credits; and reforming the economy to lower its dependency on Russia.

Although Lukashenka is mindful of potential risks and threats to his power from economic liberalization, he is open to changes in some areas, such as further developing the successful IT sector, privatising non-strategic state-owned enterprises and increasing trade with EU countries.

These reforms will most likely continue, although this year’s presidential election may distract attention, as Lukashenka seeks a sixth term in the knowledge that his popularity is falling. He may also need to divert some economic resources to maintain the support of his core electorate.

For the moment, Moscow does not appear to be in a hurry, believing that Lukashenka and Belarus are going nowhere and that concessions by Minsk are only a matter of time.

The armed conflict in Donbas has now entered its seventh year. President Zelenskyy, who came to power in May 2019, promised to end the war with Russia and bring peace to Ukraine.

Since assuming office, Zelenskyy has managed to revive the Normandy Format talks, complete military disengagement at three points along the line of contact and negotiate the release of over a hundred Ukrainians held as prisoners of war in Russia. However, ceasefire violations continue to occur frequently.

Looking at the origins of the armed conflict in Donbas and the region’s economic role in Ukraine’s economy, this event discusses the prospects for conflict resolution. Do the recent events signify an opportunity for peace? Does Zelenskyy have a viable plan for re-integrating Donbas or will the region be cut off from mainland Ukraine for the foreseeable future?

The speakers assess the strategy and track record of the Ukrainian government and its Western allies in bringing parts of the occupied Donbas under Kyiv’s control. They also review possible policy implications of the COVID-19 pandemic for the conflict.

China’s adherence to the rules-based international system is selective, prioritizing certain rules in favour of others. States supportive of that ‘system’ – or, as some argue, systems[1] – should identify areas of mutual strategic interest so that they can draw China further into the global rules-based order and leverage China as a constructive player that potentially also contributes to improvements in such areas. This is particularly apposite at a time when the US is in retreat from multilateralism and Russia seems bent on disrupting the rules-based international order.

Supportive player

There are many reasons for actively engaging with China on mutual areas of interest. China is a committed multilateralist in many areas, recognizing that often international cooperation and frameworks hold the key to its domestic problems, for example in the fields of environmental sustainability and financial regulation.

China’s economic power is valuable in upholding international institutions: China is the UN’s third-largest donor (after the US and Japan) at a time when the UN is facing budgetary shortfalls. China is also the second-highest contributor to the UN peacekeeping budget, and the largest contributor of peacekeeping forces among the five permanent members of the UN Security Council.

China also has a valuable role to play in the settlement of international disputes over trade and investment. China is a big supporter of the World Trade Organization (WTO)’s dispute settlement mechanism, and one of its most active participants;[2] China is currently playing an active role in negotiations to save the WTO’s appellate mechanism from folding in the wake of the US’s refusal to nominate new judges.

The last 15 years have also seen a major shift in Chinese attitudes to investment arbitration, from a general suspicion and limitation of arbitration rights to broad acceptance and incorporation of such rights in China’s trade and investment treaties. China is actively engaged in multilateral negotiations through the UN Commission on International Trade Law (UNCITRAL) on reforms to investor–state dispute settlement.

China has shown leadership on global climate change diplomacy, urging nations to remain committed to the Paris Agreement in the wake of the US decision to pull out, and has been an important interlocutor with the UK and the EU on these issues. As a strong supporter of the Paris Agreement, but also as the world’s top emitter of carbon dioxide, China has a crucial role to play in pushing forward implementation of the Paris targets. Despite its high emissions, China remains one of the few major economies on track to meet its targets,[3] giving it greater leverage to peer review other parties’ efforts.

A recent report by the UK parliament’s Foreign Affairs Committee (FAC), on China and the rules-based international order, noted that where a body of trust and goodwill is developed with China, there is the possibility of discovering interests that coincide and the ability to work together on issues mutually regarded as of global importance. The report refers to a number of success stories from UK partnership with China in multilateral forums, including in counterproliferation and global health.[4]

Developing areas of global governance

As well as working with the current system, China is increasingly involved in the shaping of newer areas of international law – whether it be submissions to the International Tribunal for the Law of the Sea (ITLOS) on procedural rules for the emerging deep-sea mining regime or pitching for a greater role in Arctic governance.[5]

This enthusiasm should be harnessed to promote the international rule of law, but at the same time there needs to be recognition of the strategic goals that drive China’s engagement. China’s interest in the Arctic, while including the desire to protect its ecology and environment, is also about access to marine resources, as well as about the Arctic’s strategic potential for China’s military.

China’s submissions to ITLOS on the rules of procedure for deep-sea mining are constructive, but also reflect an ambition to secure first-mover advantage when commercial mining eventually takes place. Like other major powers working in this policy area, China’s actions are guided by self-interest, but that doesn’t mean its goals can’t be pursued through multilateral rules.

China is also interested in creating new international structures and instruments that further its strategic aims. For example, with Russia (through the Shanghai Cooperation Organisation) it has proposed an International Code of Conduct for Information Security in the UN.[6]

China is also pondering an array of options for dispute-resolution mechanisms for its Belt and Road projects, including the possibility of an Asian version of the international Convention on the Settlement of Investment Disputes, which might sit under the auspices of the Asian Infrastructure Investment Bank (AIIB).[7]

The creation of new instruments and institutions need not be a threat to the rules-based international order in itself. We have already seen a combination of the creation of parallel complementary regimes alongside the reform of existing institutions, for example in development financing through the AIIB or the New Development Bank (often referred to as the ‘BRICS Bank’); these two banks are relatively conventionally structured along the lines of Western-dominated institutions, albeit with greater Chinese control. Based on these examples, selective adaptation seems more likely than a hostile ‘Eastphalian’ takeover.[8]

Risks

There is, however, a real risk that in certain areas China may promote a rival authoritarian model of governance, assisted by an opportunistic convergence with Russia on issues such as human rights, development and internet governance. In areas where China’s core interests clash with those of the rules-based international order, China has shown itself to be unbending, as in its refusal to abide by the July 2016 decision of the Permanent Court of Arbitration in its dispute with the Philippines over the South China Sea.[9]

China is becoming more assertive at the UN, but while it seeks to project itself there as a responsible emerging global leader, it is promoting a vision that weakens international norms of human rights, transparency and accountability,[10] while also carrying out practices domestically that raise serious human rights concerns (not least the detention of hundreds of thousands of Uighurs in re-education camps in Xinjiang).[11]

China’s increased dominance geographically and geopolitically through its Belt and Road infrastructure projects carries with it a number of social and economic risks, including smaller states becoming trapped in unsustainable financial debts to China.

But at a recent Chatham House conference on Asia and international law, participants highlighted the limitations on how far China can shape an alternative governance model.[12] China currently lacks soft power, cultural power and language power, all of which are needed in order to embed an alternative model abroad. China also currently lacks capacity and confidence to build coalitions with other states in the UN.

Where it has tried to get buy-in from the international community for its new institutions, such as the China International Commercial Court (CICC) announced in July 2018, there has been scepticism about the standards to be applied.[13] Unless the court can demonstrate sufficient due process, international parties are likely to prefer other centres with a strong reputation for upholding the rule of law, such as those in London, Dubai and Singapore.

Where China does promote its own governance model at the expense of the rules-based international order, states are starting to push back, often in concert. EU member states so far have adopted a joined-up approach to the Belt and Road Initiative. With the exception of Italy, they have refused to sign a Memorandum of Understanding on participation unless China provides much greater transparency on its compliance with international standards.

The EU also recently presented a coordinated response to China on the situation in Xinjiang.[14] Similarly, members of the so-called ‘Five Eyes’ intelligence-sharing alliance (comprising Australia, Canada, New Zealand, the UK and the US) have acted together in relation to certain incidents of cyber interference attributed to China.[15]

There are also signs of pushback from smaller states closer to home in relation to challenges to national sovereignty, debt diplomacy and financial viability arising from Belt and Road projects. The Sri Lankan government recently reversed the award of a $300 million housing deal to China, instead opting for a joint venture with an Indian company.

China has been downscaling its investments as a way to counter some of the backlash it has received: the most recent Belt and Road summit put forward a more modest set of aspirations. This suggests that there is some scope for states to stand up to China and use leverage to secure better deals.

Many international institutions have been Western-dominated for years;[16] China, together with many emerging and middle powers, has felt for some time that the international architecture does not reflect the world we live in. Given that context, states that champion the rules-based international order should acknowledge China’s desire to update the international order to reflect greater multipolarity, globalization and technological change, while being clear-eyed about their engagement with China. This involves investing in a proper understanding of China and how it works.[17]

Where possible, cooperation with China should lead to outcomes that are backed up by international standards and transparency. The above-mentioned FAC report cites evidence that the UK’s support, and that of other developed countries, had a positive impact in shaping the governance and standards of the AIIB.[18] China has brought in international experts to advise on disputes before the CIIC, which may reassure would-be litigants.

China’s relationship with the rules-based international order needs to be assessed pragmatically and dynamically. China can be a valuable partner in many areas where its objectives are closely aligned with those of the international community – from trade to climate change to peacekeeping.

But where the country’s core interests are at odds with those of the wider international community, an increasingly confident China will strongly resist pressure, including on the South China Sea and human rights. In these areas, states supportive of international law can most powerfully push back through alliances and by ensuring that their own core values are not compromised in the interests of economic benefits.

Notes

[1] Chalmers, M. (2019), Which Rules? Why There is No Single ‘Rules-Based International System’, RUSI Occasional Paper, April 2019, London: Royal United Services Institute, https://rusi.org/occasional-papers/Which-Rules-Why-There-Is-No-Single-Rules-Based-International-System.

[2] See, for example, Moynihan, H. (2017), China’s Evolving Approach to International Dispute Settlement, Briefing, London: Royal Institute of International Affairs, https://www.chathamhouse.org/publication/chinas-evolving-approach-international-dispute-settlement.

[3] UN Environment (2018), Emissions Gap Report 2018, p. XVII, https://www.unenvironment.org/resources/emissions-gap-report-2018.

[4] House of Commons Foreign Affairs Committee (2019), China and the Rules-Based International System: Sixteenth Report of Session 2017–19, p. 32, https://publications.parliament.uk/pa/cm201719/cmselect/cmfaff/612/612.pdf.

[5] Moynihan, H. (2018), ‘China Expands Its Global Governance Ambitions in the Arctic’, Expert Comment, 15 October 2018, https://www.chathamhouse.org/expert/comment/china-expands-its-global-governance-ambitions-arctic.

[6] Updated version proposed 9 January 2015.

[7] Moynihan, H. (2018), ‘Exploring Public International Law Issues with Chinese Scholars – Part Four’, Meeting Summary, 3 June 2018, https://www.chathamhouse.org/publication/exploring-public-international-law-issues-chinese-scholars-part-four.

[8] Chatham House (2019, forthcoming, ‘Security and Prosperity in the Asia-Pacific: The Role of International Law’, conference summary, https://www.chathamhouse.org/event/security-and-prosperity-asia-pacific-role-international-law.

[9] Permanent Court of Arbitration Case No. 2013-19 (Philippines v China), Award of 12 July 2016, https://pca-cpa.org/wp-content/uploads/sites/6/2016/07/PH-CN-20160712-Award.pdf.

[10] Piccone, T. (2018), China’s Long Game on Human Rights at the United Nations, Washington, DC: Brookings Institution, https://www.brookings.edu/wp-content/uploads/2018/09/FP_20181009_china_human_rights.pdf.

[11] Wye, R. (2018), ‘‘The entire Uyghur population is seemingly being treated as suspect’: China’s persecution of its Muslim minority’, LSE Religion and Global Society blog, 18 September 2018, https://blogs.lse.ac.uk/religionglobalsociety/2018/09/the-entire-uyghur-population-is-seemingly-being-treated-as-suspect-chinas-persecution-of-its-muslim-minority/.

[12] Chatham House (2019, forthcoming, ‘Security and Prosperity in the Asia-Pacific: The Role of International Law’.

[13] Walters, M. (2018), ‘Jury is out over China’s new commercial court, say lawyers’, Law Society Gazette, 1 November 2018, https://www.lawgazette.co.uk/law/jury-is-out-over-chinas-new-commercial-court-say-lawyers/5068125.article.

[14] The Economist (2019), ‘Hope remains for Western solidarity. Look at embassies in Beijing’, 17 April 2019, https://www.economist.com/china/2019/04/20/hope-remains-for-western-solidarity-look-at-embassies-in-beijing.

[15] In December 2018, the Five Eyes attributed the activities of a Chinese cyber espionage group targeting intellectual property and sensitive commercial property to China’s Ministry of State Security.

[16] Roberts, A. (2017), Is International Law International?, Oxford: Oxford University Press.

[17] Parton, C. (2019), China–UK Relations: Where to Draw the Border Between Influence and Interference?, RUSI Occasional Paper, February 2019, London: Royal United Services Institute, p. 30, https://rusi.org/publication/occasional-papers/china-uk-relations-where-draw-border-between-influence-and.

[18] House of Commons Foreign Affairs Committee (2019), China and the Rules-Based International System, p. 15.

This essay was produced for the 2019 edition of Chatham House Expert Perspectives – our annual survey of risks and opportunities in global affairs – in which our researchers identify areas where the current sets of rules, institutions and mechanisms for peaceful international cooperation are falling short, and present ideas for reform and modernization.

Two December meetings between Presidents Vladimir Putin and Alexander Lukashenka failed to deliver Moscow’s hopes of securing Minsk’s acceptance of closer alignment between Russia and Belarus.

Over the past year, relations between Belarus and Russia have been under unprecedented strain as Moscow has tried to encourage Minsk to sign up to a different format of relations designed to keep Belarus firmly in a Russian orbit. Details of the negotiations have remained secret, yet issues on the table appear to include unification of tax and customs systems, a common energy regulator and joint governing bodies.

The Kremlin believes that Belarus needs to deliver more in return for Russia’s continued economic support, worth around $10 billion per year. In December 2018, it issued an ultimatum: Belarus would only continue to receive a discounted price for oil and gas and enjoy preferential access to the Russian market if it agreed to reanimate the largely dormant 1999 Union Treaty that called for the unification of Belarus with Russia.

During 2019, frantic work took place on both sides to prepare a detailed framework for achieving deeper integration between the two countries. This did not succeed in overcoming a set of long-standing issues related to economic relations.

To step up pressure, the Russian prime minister, Dmitri Medvedev, signalled in early December that Russia would withhold economic privileges for Belarus pending full implementation of 30 integration road maps that he claimed had already been agreed. To the alarm of Minsk, he also suggested that discussion of a 31st roadmap would follow to include the creation of a single currency and supranational institutions. The Belarusian authorities view this level of integration as a threat to national sovereignty.

On the surface, Belarus’ negotiating position is weak. By resisting market reforms that could have diversified imports and exports, Lukashenka has instead kept the economy tied to Russia; 40% of Belarusian exports go to Russia. In addition, Russia has decreased its reliance on imports from Belarus as part of a broad policy of import substitution.

Raising the gas price will deprive Belarusian companies of their comparative advantage.  Approximately 90% of Belarus’s electricity and heat is generated by natural gas imported from Russia at below market prices. Petroleum products refined from Russian crude oil that is supplied duty-free to Belarus account for the largest source of the country’s export earnings.

Minsk fears that the current oil taxation reform in Russia could cause Belarus losses of up to $9 billion by 2024 as a result of higher prices for Russian oil and the loss of export duties. Economic growth slowed from 3% in 2018 to just over 1% in 2019 and could fall further if Russia does not grant concessions on the oil price.

The country’s high level of public debt denominated in foreign currency makes the need to find cash more urgent and exacerbates the Russian pressure. Russia is Belarus’ biggest creditor, accounting for 38% of state debt.

However, Lukashenka is a master of negotiation with the Kremlin, with a talent for turning weakness into strength.

First, by eliminating political competition in Belarus, he has given Putin no option but to deal with him personally. Second, he understands that Moscow needs to present integration between the two countries as voluntary and does not want to use economic sanctions or other tools of persuasion that could destabilize Belarus. Third, he knows that there is no consensus in Moscow on creating a single currency. Unification of the tax systems would also be problematic because of their different structures. If these measures were implemented, Moscow could end up paying much larger subsidies to keep Belarus stable.

Minsk is therefore likely to pursue three options: dragging out the negotiations with Moscow, while continuing to declare its commitment to closer union with Russia; seeking alternative sources of energy and credits; and reforming the economy to lower its dependency on Russia.

Although Lukashenka is mindful of potential risks and threats to his power from economic liberalization, he is open to changes in some areas, such as further developing the successful IT sector, privatising non-strategic state-owned enterprises and increasing trade with EU countries.

These reforms will most likely continue, although this year’s presidential election may distract attention, as Lukashenka seeks a sixth term in the knowledge that his popularity is falling. He may also need to divert some economic resources to maintain the support of his core electorate.

For the moment, Moscow does not appear to be in a hurry, believing that Lukashenka and Belarus are going nowhere and that concessions by Minsk are only a matter of time.

The armed conflict in Donbas has now entered its seventh year. President Zelenskyy, who came to power in May 2019, promised to end the war with Russia and bring peace to Ukraine.

Since assuming office, Zelenskyy has managed to revive the Normandy Format talks, complete military disengagement at three points along the line of contact and negotiate the release of over a hundred Ukrainians held as prisoners of war in Russia. However, ceasefire violations continue to occur frequently.

Looking at the origins of the armed conflict in Donbas and the region’s economic role in Ukraine’s economy, this event discusses the prospects for conflict resolution. Do the recent events signify an opportunity for peace? Does Zelenskyy have a viable plan for re-integrating Donbas or will the region be cut off from mainland Ukraine for the foreseeable future?

The speakers assess the strategy and track record of the Ukrainian government and its Western allies in bringing parts of the occupied Donbas under Kyiv’s control. They also review possible policy implications of the COVID-19 pandemic for the conflict.

This event is part of a series of illegal logging update meetings that will bring together more than 250 participants from civil society, industry and governments from around the world. 

Download the presentations from the event on the Illegal Logging Portal.