Taking Xi seriously

As the Ukraine disaster shows, an internally undisputed autocrat’s words have to be taken seriously. This goes for Putin – the demise of the USSR as ‘the biggest disaster of the 20th Century’, thus his fight to restore it – as it does for Xi Jinping. The latter’s rhetoric, political initiatives and actions since his inthronization as ‘Mao II’ last fall are particularly ominous and presage the possibility that the already raging Cold War 2.0 could become hot. Here is why.

Xi’s speeches

In his recent major speeches, Xi made it abundantly clear that restraint in Chinese foreign relations is a thing of the past. Deng Xiaoping’s famous adage: hide our capacities and bide our time; be good at maintaining a low profile is totally disregarded and replaced by aggressive language in all respects.

Of particular worry is Xi’s exhortation dare to fight to all his audiences, including his generals when he addresses them within the Central Military Commission which he of course presides over, too. There is reason to listen carefully to those who see hostile action against Taiwan in the not so distant future. Actions ranging from trade blockages over occupation of Taiwanese islets just off the Chinese mainland all the way to a military occupation of the Island.

Internal and external control

The main ingredients of controlling all of the population are known since a certain time: social credits for strict observance of the Communist Party’s guidelines of obedience, forced assimilation of ethnic minorities to Han-Chinese modes as well as silencing of all dissident behavior and expression. Recently even all mention of problems which cannot exist in Xi’s China but clearly persist, such as poverty as well as the ever wider cleavage between metropolitan and rural population is being banned, as the recent total disappearance from the net of the well known blogging sociologist Hu Chenfeng shows.

Of particular worry for anybody dealing with China and Chinese citizens is the controlling outreach to anybody in contact with Westerners. This goes for Chinese students working and studying abroad who have to pledge total allegiance to the Party and its goals under threat of state action against their families. Forced know-how transfer for Western companies active on the mainland and outright theft of technology by Chinese abroad are well documented. In consequence a considerable number of Western companies have curtailed their activity in China and moved it elsewhere, including their outsourcing and spare parts provision. The latter also in view of potential trade boycotts and physical blockages in case of Chinese aggression against Taiwan.

China and the 3rd World

Xi has also reverted to Maoist language in China’s relations with all non-Western countries: China as the leader of all oppressed peoples by colonialism and later by the monopolistic behavior of the US in particular and in general Western structures in international relations.

His respective piece de maitre was and is supposed to be the much vaunted Belt and Road Initiative BRI, a gigantic mass of Chinese infrastructure connecting the Empire du Milieu and its emperor Xi with the rest of the world. So far a massive amount of concrete and steel – sourced from China, paid by Chinese credits and entirely processed by Chinese – have been invested from South East Asia over South Asia, Africa, Non-EU Europe to South America. Problem is that this investment was primarily wanted by the ruling classes in receiving countries, not their population and moreover came at a considerable cost. On a recent international teaching occasion an African participant told me quote 80-90 percent of our populations don’t want China as a neocolonialist force, but the 10 to 20% who are reigning and dominating our countries do unquote. The difficult debt situation of many emerging countries, also in the wake of BRI, is at present being fought off by emergency loans, costing 2% from the IMF (International Monetary Fund) but at least double that when China comes to the rescue.

On a political level Xi is acting as the Great Reconciler. His recent sally into Middle East politics, the bringing together of Iran and Saudi Arabia was a success, at least in the short term. But the main point here was not Chinese good offices but economic interests by the Shiite and the Sunni empires – e.g. better control of global oil price in the present age of decarbonization – and Anti-Americanism. The latter evident on the Iranian side and on the Saudi lingering personal resentment by the autocratically and supremely reigning Crown Prince Mohammed bin Salman against President Biden who had called him ‘a murderer’ (Kashoggi affair) and initially wanted to deal only with ‘the real king’.

In this area Xi’s supreme achievement is supposed to be peace between his close autocratic ally Putin and the Ukraine fighting for its survival.

Ukraine

But then the much heralded Chinese ‘Peace Plan for the Ukraine’ is no such thing, as it foresees important Ukrainian loss of territory. In the face of Russian aggression and atrocities there will not be peace without a visible Russian defeat, resulting in returning at least a big part of occupied Ukrainian territory. This can only be achieved by continued massive arms delivery to Kiev, an immutable fact understood by almost all Western countries who continue to act accordingly. Under the exceptions Switzerland ranks prominently, clinging, at this time, to an outdated notion of traditional neutrality.

On the other hand, massive arms transfer from Xi to Putin, under the guise of the much reaffirmed special relationship not allies but better than allies, could be a game changer. So far Beijing has refrained from doing this as it could not be made without being noticed by Western surveillance. For the time being, Beijing concentrates its efforts on splitting off the EU-countries from the US, both by betting on war fatigue in Europe and the eternal economic leverage over business hungering for the Chinese market both for exports and investments to produce in, and for this market. This is Xi’s present game with Western European leaders visiting Beijing. President Macron who is seeing himself as a major player on the global chessboard while ignoring his greatly diminished domestic status, has walked into this trap. His attempt to persuade Xi to put pressure on Putin towards a just and peaceful settlement in the Ukraine is variously described as near delusional and a fool’s errand in the authoritative Foreign Policy Magazine.

Europe

Fortunately Macron was given a European guardian angel when seeing Xi in Beijing in the person of EU-Commission President Ursula von der Leyen. She found little positive things to say on the vague Chinese Peace Plan for the Ukraine and, contrary to Macron, she also found clear words in a public statement with Xi listening regarding the well documented human rights violations in Xinjiang.

This joint visit exemplifies the European dilemma towards Xi’s China. Spain’s Sanchez and Germany’s Schulz, preceding them, as well as Macron came with large national business delegations anxious to expand their respective share in the supposedly largest marketplace in the world. Supposedly, because it is a demographic fact that only about a third of China’s 1.3 bn. inhabitants can afford Western consumer goods. On the other hand all EU leaders,, including the three mentioned representatives from the top four European economic heavyweights, have subscribed to designation of China as a systemic rival. This tightrope walk of economic desires on the one hand and geopolitical reality on the other is difficult and prone to failure when, in the face of open Chinese aggression – be it against Taiwan or massive arms delivery to Putin – US led sanctions will have to, and will be greatly reinforced.

The often heard formula used by business executives of China plus one, meaning one alternative production site outside mainland China, works only in the face of the presently applied, comparatively mild sanctions within the framework of the Cold War 2.0. between the US and China. Should the latter heat up, then all bets are off: All shipping lanes to the Indo-Pacific will be interrupted, freight insurance and export financing will become prohibitively expensive, quite aside from all direct impact of eventual military action.

The Choice

Perceptions count in all international relations as much as reality. The most dangerous one among the former is Xi’s perception of all other countries, with the sole exception of the US seen by him as an equal rival, as vassals of the empire du milieu. His plan is thus to counter US military strength – or at least to keep his aggressions on a level where Washington will hesitate to mobilize all its unmatched might – keep Europe hobbled by golden economic chains and establish himself as the undisputed leader of The Rest. He might well miscalculate on all of the above points as shown above. But only if all concerned realize what the gambit is. Strength as well as flexibility with regard to business choice will be required.

A recent example, on a regional level stands out in a positive sense. Australia, faced with Chinese boycotts against its exports managed to sell its high quality coal elsewhere; in security policy it has joined the US as the only credible deterrence against China. Canberra is now an active member of the Quad, the quadrilateral security dialogue morphing into a nascent NATO of the East and has, by its choice of US made nuclear powered subs, fully joined AUKUS (Australia/UK/USA) which could be described as the hard core of Asian resistance against China, linked by a mutual security bond akin to NATO’s Article 5.

Picture: COP PARIS