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Charm Offensive at Beijing’s Free Will? Yang Jiang.

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Presentation on theme: "Charm Offensive at Beijing’s Free Will? Yang Jiang."— Presentation transcript:

1 Charm Offensive at Beijing’s Free Will? Yang Jiang

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3 3 1809

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5 Diplomatic Strategy From: 韬光养晦 tao guang yang hui (hide the blade and accumulate strength) To: 与时俱进 yu shi ju jin (advance with time) ‘a responsible great power’

6 connotation Yang Jiechi March 2008: to deepen strategic and political mutual trust between China and other countries, and to create a good environment and atmosphere for international economic cooperation; to propel multilateral and bilateral free trade cooperation and resolve economic disputes through dialogue; to support the realisation of important cooperation projects and to protect legal rights of overseas Chinese citizens and companies.

7 instruments bilateral trade agreements (FTA) (regional) financial cooperation outward investment resource diplomacy WTO foreign aid

8 FTAs StatusCountries / Regions Proposed Mercosur (South American Common Market), Northeast Asia, Shanghai Cooperation Council Feasibility StudyIndia, South Korea, Switzerland Under negotiation Chile on investment, Australia, Costa Rica, the Gulf Cooperation Council, Iceland, Norway, South Africa Customs Union. Agreement on Trade in GoodsChile Agreement on Trade in Services Chile ‘Comprehensive’ agreement ASEAN, New Zealand, Pakistan, Peru, Singapore, Hong Kong, Macau

9 FTA Policy: Liberals vs. Protectionists Lack of imperative to enforce domestic reforms, in contrast to the WTO Liberals: MOFCOM, exporters Protectionist forces Agriculture: ‘Three Agricultural Problems’ and MOA Services and Investment: economic security, partial reform and monopoly profits NDRC (National Development and Reform Commission) Ethnic problems National People’s Congress



12 FTA policymaking: Politics and Economics Ministry of Commerce (MOFCOM) Ministry of Foreign Affairs: ‘big country morality’ of ‘giving more and taking less’? The leadership Bureaucratic capacity and coordination

13 (regional) financial cooperation From response to responsibility? Asian Monetary Fund Chiang Mai Initiative: surveillance? A supra- national body? Exchange Rate Coordination... constrained by the exchange rate policy, a closed capital account and weaknesses in the banking system

14 IMF and World Bank Call for increased voting power for developing countries, for Asia--G20 International Reserve Currency - Special Drawing Rights: ‘testing the water’ Experimenting internationalization of RMB Issues: conditionality - Beijing Consensus/China Model? transparency call for a new international economic order?

15 outward investment 2001 from restrictive to encouraging 2004 more supportive measures 2006 reflection on ‘neo-colonialism’ 2008 from caution to aggression now in the process of making a strategy...


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19 Outward Investment MFA: support, service, bridge SASAC: the great butler; unclear Dept. of Organization of the CCP: personnel NDRC: the small State Council; proposals MOFCOM: contracts SAFE: supportive banks: policy, commercial SOEs: central, local Chinese company MFA foreign company NDRC MOFCOM banks SAFE SASAC CCP

20 Climate Diplomacy? support for other developing countries: solar water heaters, bio-energy and nuclear? a green development fund? COP15

21 To be continued... State-business relations? A national strategy for economic diplomacy? Political and economic interests? China’s identity?

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