Xi’s long game
Prior to the recent CCP congress, the oldest retired official in China, the 105-year-old Song Ping sent a congratulatory video message for a preparatory event. In it, he observed that the policy of reform and opening-up ‘has been the only path to the development and progress of contemporary China and the only path to the realisation of the Chinese dream.’ The words echoed those of Deng Xiaoping, the architect of the great opening-up of the national economy in the 1980s, but they weren’t originally uttered by him. They were spoken by the current General Secretary, Xi Jinping, during a New Year’s address in December 2017 marking the 40th anniversary of Deng’s reforms. For Song Ping, a revered party elder who once told Jiang Zemin to retire, to have repeated Xi’s own words was regarded by many as a direct rebuke of the current leader’s policies. Not that Xi has repeated what he said about reform and opening-up in 2017. His words on that occasion now seem like a remark he had to make in a spirit of apparent dutifulness to a predecessor, but which he never believed or practiced.
Two years after his nod to Deng’s reform, the CCP journal Qiushi first published Xi’s address to party members six years earlier in January 2013. In it, Xi clearly rejects the embrace of capitalism: ‘The eventual demise of capitalism and the ultimate victory of socialism will require a long historical process to reach completion. In the meantime, we must have a deep appreciation for capitalism’s ability to self-correct, and a full, objective assessment of the real long-term advantages that the developed Western nations have in the economic, technological, and military spheres. Then we must diligently prepare for a long period of cooperation and of conflict between these two social systems in each of these domains.’ Xi’s rejection of capitalism was also reflected in the April 2013 Communique on the Current State of Ideological Sphere which outlined seven ideas to be rejected, including ‘promoting neoliberalism (and) attempting to change China’s Basic Economic System.’
The ideological Xi increasingly repudiates the economic reforms of Deng, despite attempts in the official history of the CCP to reconcile the two as some predetermined pathway. China currently faces a series of weighty problems, including significant population decline and a worsening economic trajectory. Its chances of escaping the middle-income trap are receding by the day; and its debt trap is growing. These structural challenges are compounded by the self-inflicted covid-zero policy, the worst drought for decades and an energy crisis. Not that this has swayed Xi who called on CCP members to focus on their ‘historical mission’ and prepare for ‘great struggles ahead’ in a recently published article. Xi firmly believes that in the great struggle against the free-market democratic nations, his Marxist-Leninist polity ‘with Chinese characteristics’ will prevail.
It is this ideological focus that determines Xi’s attitude to international affairs including both security and economic relations. He is committed to a conception of global relations in which China regularly breaches international agreements and understandings not to its liking. As he said in 2014, ultimately China envisages ‘constructing international playgrounds’ and ‘creating the rules’ for the games played in them.
Understanding the CCP’s rigid commitment to these ideological objectives should underpin any discussion of China’s participation in international agreements and arrangements. This includes China’s interest in joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, a trade agreement established in 2018 between 11 Pacific nations including Australia. China is one of four current or potential applicants to the agreement, along with the UK, Taiwan and Ecuador. Its attention was piqued by Taiwan’s interest in joining an arrangement that encompasses almost 15 per cent of global GDP.
Two Australian-based China scholars recently urged the admission of the PRC into the agreement, arguing that the ‘only solution to trade grievances with China is to make use of the China-specific rules under the Word Trade Organisation; and when new rules are needed, do the job of negotiating them. Alternatively, sign China up to existing agreements that build on existing WTO minimums, such as the CPTPP.’
The scholars claim that China’s entry price to the WTO was high and onerous but suggest that the communist regime is willing to meet the standards required. ‘Certainly there is room for China’s compliance to improve. But the relevant metric is not perfection. After all, the US is a respondent on more than three times as many WTO disputes (156) as China (49).’
They note that ‘in May, Singapore Prime Minister Lee Hsien Loong said China’s application to join the CPTPP should be welcomed. His reasoning: it is far better for the Chinese economy to be integrated into the region than to operate by a different set of rules. New Zealand and Malaysia agree.’
‘No one is suggesting that China be allowed entry to CPTPP without committing to its high standards. But welcoming the start of negotiations would provide a unique opportunity for Canberra to discuss with Beijing issues on trade that matter for our interests and act as a strong incentive for China to enact further economic reforms, just as its WTO accession did 20 years ago,’ they add.
This argument naively assumes that the CCP will meet its international obligations when, according to President Xi himself, the regime is abiding its time until it can impose its own political rules upon the world. Free Trade Agreements did not prevent China from unilaterally imposing trade sanctions on Australia and other nations when it determined to do so. China routinely breaches it WTO obligations. Even when some trade barriers have been reduced, non-tariff hurdles face many potential exporters to China. China’s trustworthiness cannot be determined by economic measures alone. In almost every other realm of international relations, it has displayed a willingness to disregard international laws when in its own interest. Why should the world continue to accommodate China when it routinely rebuffs the values of mutual trust and compromise that underpin workable global relations?
A unanimous Parliamentary Foreign Affairs Defence and Trade committee report recommended that Australia not support China’s accession until it had ended coercive trade measures. It also supported the inclusion of Taiwan in the agreement. Contrary to Mr Albanese’s recent observation that an agreement could not be entered, as it is not a country, Taiwan is already a participant in World Trade Organisation frameworks. New Zealand already has a Free Trade Agreement with Taiwan. As Taiwanese Foreign Minister Joseph Wu indicated, no treaty member had objected to his country joining. Is China now directing Australian policy?
First published in the Spectator Australia.
