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 Positioned to possibly be the next superpower.  Economic growth averaged around 10% in the last 5 years.  World’s largest producer of steel  Since.

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Presentation on theme: " Positioned to possibly be the next superpower.  Economic growth averaged around 10% in the last 5 years.  World’s largest producer of steel  Since."— Presentation transcript:

1  Positioned to possibly be the next superpower.  Economic growth averaged around 10% in the last 5 years.  World’s largest producer of steel  Since 2011, the world’s biggest consumer of energy  One of the world’s largest exporters  Politically – has a seat on the UN Security Council (used veto in pursuit of China’s national interests e.g. 2008 China used its veto to stop a UN resolution imposing UN sanctions on President Mugabe of Zimbabwe, as Zimbabwe is a key market for China’s arms; 2012-13 Vetoes regarding Syria.)

2  Militarily – modernising it’s military, and increasing spending to $US 104.6 (2012) billion annually – trying to contest U.S. air and maritime supremacy in the Western Pacific.

3  China’s rise is not guaranteed as they face challenges internally from separatist groups and mounting dissatisfaction of the economic distribution in some portions of the population.  17 of the 20 most polluted cities are in China.  1/3 of population, located in rural regions, have no access to improved sanitation (477 million Chinese).  According to the World Bank, 11.8% of the population still live on less than $1.25 a day  Social problems are having a dramatic impact on internal social cohesion (spring 2008 riots in Lhasa and Khotan, July 2008 Yunnan bombings, 2009-13 Xinjiang upheavals)  The more developed and prosperous the country becomes, the more insecure and threatened the Chinese leaders feel as an authoritarian regime.

4  Many and varied, but 4 key national interests are: ◦ Economic development ◦ Territorial integrity ◦ Improved international standing ◦ Creation of a socialist harmonious society

5  Growth is a result of Beijing’s efforts to open up the economy to market forces. This was initiated by Deng Xiaoping at 1978 annual Communist Party of China conference.  First global exporter and second largest importer–total trade in 2011 was over $US 3.6 trillion, second in the world after the US.  Economic development, on a more sustainable and ‘harmonious’ basis, still remains at the top of Beijing’s priorities, as clearly outlined by China’s new president Xi Jinping.

6  Actions supporting economic development: ◦ Joined WTO in 2002 ◦ Allowed private ownership of homes in 2004 ◦ Passed legislation making foreign investment into China easier ◦ Dropped average tariffs from 56% in 1982 to 9.8% in 2011. ◦ Achieved Most Favoured Nation status with US: President Clinton signed into law on October 2000 and the status was made permanent on December 2001 by President Bush. ◦ Negotiated several free trade areas agreements with primary international actors (e.g. ASEAN in 2010)

7  China’s economic size will potentially surpass US by mid 21 st century, but per capita remains low.  Disparity in wealth across the country. Cities and coastal areas remain the beneficiaries of development but internal regions and rural areas largely underdeveloped. 440 million have risen from poverty in the last two decades. The richest 10% of citizens hold 30% of the state’s wealth.

8  Increasing vocal public outrage e.g. 2008 anti-France rallies in response to Sarkozy’s threat to boycott Olympics if China did not initiate dialogue with Tibet; 2012 a new episode in the Senkaku/Diaoyu dispute against Japan.  Lack of political transparency and accusations of massive governmental corruption (estimated to cost Chinese economy over $86 billion a year)

9  Rapidly aging population due to one-child policy. Approx. 70% of elderly are financially dependent on offspring.  Pool of workers is drying up.  Environmental issues: air pollution, soil erosion and desertification. World Bank estimates pollution is responsible for 750,000 deaths in China annually and 70% of the 2 million cancer deaths annually are pollution related.  Coal consumption (70% of China’s energy consumption) key contributor to sulphur dioxide emissions, that caused acid rain to fall in over 30% of the country.

10  Rising under and unemployment Former Vice President of CCP Zheng Bijian projected that from 2006 to 2015, 24 million new jobs will have to be created in cities each year. The gap between unemployment rates in rural and urban areas still persists (in 2011, rural migrants working in urban areas reached 158 million)

11  China’s economic growth is dependent upon good relations with other states, diplomacy and co-operation in multilateral forums.  Economic sanctions were placed on China by many states after the 1989 student protests in Tiananmen Square. As a result, China realised that its internal affairs affect the external gains it can make on an international stage and hence, its national interests.  E.g. Its economic development is heavily reliant on favourable relations with other states (trade, global investment).

12  Population: over 1.350 billion  Majority ethnic group: Han Chinese 91.5%  8.5% (more than 100 million people) are not Han Chinese  Three key issues of territorial integrity: ◦ Taiwan ◦ Tibet ◦ Uighur region of Xinjiang

13  Important to Beijing’s desire to create a socialist harmonious society that none of these regions declare or seek to attain independence.  If one succeeded, Beijing fears it would encourage further separatism from the state, undermining the power and public face of the government.  Beijing refers to the 3 Evils: “one of the three forbidden forces of terrorism, religious extremism and separatism”

14 Taiwan  “One China” policy of Beijing – states that the Chinese territory is one nation and cannot be divided into 2 Chinas or one China and one Taiwan.  China seeks to peacefully reunify with Taiwan on the basis of “one country, two systems”.

15  Permanent seat on UN Security Council  Acknowledged nuclear power  Capable of independently launching humans into space  Hosting 2008 Olympics  Increased role in six-party talks on North Korea (“shuttle diplomacy” – intermediary)  China recognises that peace and stability assists in their economic development

16  Increased involvement in multilateral settings and institutions: ◦ Joined APEC in 1991 ◦ Joined ASEAN Regional Forum in 1994 ◦ Signed Non-Proliferation Treaty (NPT) in 1992 ◦ Signed Comprehensive Test Ban Treaty (CTBT) in 1996 ◦ Attempts to establish ASEAN Free Trade Agreement ◦ Sends personnel to UN peacekeeping missions ◦ Supports a code of conduct over South China Sea dispute ◦ Not exercising it’s UN Security Council veto on Iraq question in 2003 ◦ Cancelled $10 billion in debt from Africa ◦ Resolving border disputes ◦ Staunch support for WTO ◦ Joint military exercises with India and Japan in 2007 ◦ Presidential visits to traditional regional rivals e.g. Japan and India

17  All multilateral setting efforts to allay international fears of China’s rising power. Wants to be seen as a “good neighbour” internationally.  Attempting to gain influence alongside the United States.  While actively seeking the cultivation of friendly relations with its neighbours and great world powers, Beijing is careful not to be seen as too “soft” due to issues with separatist groups in Tibet, Taiwan and Xinjiang.

18  However, at times China has acted contrary to these efforts e.g. Along with Russia in 2008, refusing to impose UN sanctions on President Mugabe in Zimbabwe, claiming it is wary of setting a precedent for Security Council intervention in internal affairs of member states.  China supports Khartoum govt. in Sudan (accused of Darfur genocide). Chinese built weapons factory in Sudan circumvents 2004 UN arms embargo and 10% of all imported oil into China comes from Sudan. Beijing has invested $15 billion in Sudan since 1996.

19  Quality issues with manufactured goods from China. ◦ E.g. 2007 scandals over concerns from lead paint in toys manufactured in China ◦ Antifreeze in toothpaste ◦ Chemicals in pet food caused deaths of cats and dogs in North America ◦ 2008, tainted milk products led to the death of Chinese children and babies, hospitalisation of thousands more and bans on many related products.

20  China required to implement tighter regulations and stricter controls.  ““Made in China” label is becoming a warning for consumers” (Democrat Senator Dick Durbin)

21  17 th annual Chinese Party Congress in 2007 saw the Communist Party state an aim to build a “harmonious society” by 2020 (the idea was launched in 2005 during the National People’s Congress).  China’s rapid economic development has brought with it a “million mutinies” that if not managed and dealt with by the Party threaten to derail the government and its autonomy.

22  Inadequate social security and welfare system  In 2012, government increased to 5.2% of GDP the total spending on health services, as a result of its past inadequacies  National spending for education is 4% of GDP (2012) – slightly below the average percentage for developing countries of 4.1%.  Government seizure of land as a major source of social unrest. Approx. 1.5 million Beijing citizens evicted to give way to Olympic Games

23  Spiralling inflation  Environmental pollution  Separatist claims  Under and unemployment  Inequality of development between coastal and inland regions  Official corruption, incompetence and negligence

24  Chinese citizens becoming more active in protesting over these issues – number of “mass incidents” rising from 10,000 in 1994 to 74,000 in 2004 and more than 150,000 in 2010.  Outbursts of national pride are seen as a threat by Beijing. E.g. Burning French flags and boycott of French stores in China in response to Sarkozy’s proposed boycott of the 2008 Olympic Games opening, or against Japan concerning the Senkaku in 2012.  Beijing leaders in constant fear that their days in power are numbered. President Hu Jintao used “harmony” 33 times in the 17 th. Party Congress report in 2007. Other commonly used words were “Socialism with Chinese characteristics”, “scientific development”, “opening and reform”, and, more recently, “Chinese Dream”.

25  Foreign policy interests carried out based on a few core guiding policy documents: - Five Principles of Peaceful Co-existence (1954) - New Security Concept (1997) - Peaceful Rise (2003)

26  Mutual respect for sovereignty and territorial integrity;  Mutual non-aggression;  Non-interference in each other’s internal affairs;  Equality and mutual benefit;  Peaceful co-existence in developing diplomatic relations and economic and cultural exchanges with other countries.

27  Based on “mutual trust, peaceful resolution of disputes, mutually beneficial economic relations”;  Asia-Pacific region and the world are moving inexorably towards multipolarity and that regional dialogue and cooperation are the best way to ensure peace and stability.  Smoothing relations with China’s immediate neighbours through border agreements and related confidence-building measures.

28  Collaborating with Russia to counterbalance US international security postures related to arms control and peace enforcement  Implementing a regional diplomacy of “anti- hegemony” designed to shape a regional security environment where US alliance systems will no longer be relevant or necessary.

29  Introduced in 2003 by Zheng Bijian at the Boao Forum, to rebut against the “China threat” theories;  Two main components: domestically, by building a more “harmonious” society; externally, promoting a peaceful international environment;  Tools: soft power, economic cooperation (“win- win” approach), institutional enmeshment, non- interference. China’s Peaceful Rise (or Peaceful Development)

30  China seeks to achieve its national interests using a number of instruments of its power.  Military Instruments – has served particularly the territorial integrity national interest, with mixed results. ◦ e.g. “One China policy” is still technically intact as Taiwan has not formally declared independence, although Beijing considers the intention of the policy has been breached due to increasing pro-independence position of Taiwan in the past; ◦ March 2008 Lhasa riots (Tibet) where Beijing used strong military force evoked international outrage and gave voice to separatist claims.

31  China has exercised its military power by: ◦ Testing its military hardware ◦ Carrying out simulated exercises of the invasion of Taiwan ◦ Publicising military activities ◦ Advertising its purchase of military hardware ◦ Increasing its budget for purchasing military hardware ◦ Placing armaments and troops facing Taiwan across the Strait ◦ Carrying out joint military exercises with other states ◦ Threatening military invasion when Taiwan is considered to have contravened the One China policy. ◦ Actual use of military force

32  Since Tiananmen Square the international community is wary and watchful how China deals with domestic issues – especially the US.

33  China has exercised its diplomatic power by: ◦ Public denouncement of a state which expresses support or sympathy for separatist groups (usually followed by a demand for an apology); ◦ Formal recognition of a state that does not recognise the sovereignty of Taiwan (a prerequisite to establishing trading relations); ◦ Recalling its ambassador in states that are seen to “insult” China; ◦ Closing its embassy in a state that recognises Taiwan; ◦ Uses its veto in UN to ensure recognition or support for separatist groups does not occur; ◦ Limits Taiwanese membership and participation in international organisations and events; ◦ Stops separatist political leaders from making international visits.

34  States that choose to recognise both the PRC and ROC or the ROC over the PRC have all links with Beijing cut (usually diplomatic links but can also be economic in the form of imposing tariffs or withdrawal of aid). Taiwan is thus often isolated from the international community. e.g. 1995 US approval for visit of Taiwanese President Lee Teng-hui to visit his alma mater was seen as a violation of the One China principle and the Chinese ambassador to US was recalled.

35  Taiwan’s attempts to join UN: China uses its veto in the Security Council but also persuades other states to oppose membership. ◦ E.g. 2004 attempt – 15 states supported Taiwan, 93 states were mobilised by China to oppose membership. ◦ Currently approx. 23 states (mainly small Pacific Island states such as Nauru) recognise sovereignty of Taiwan.

36  China stops adoption of any UN resolutions that supports independence of Tibetan people.  China argues it is an “internal affair”  Foreign leaders who meet with the Dalai Lama receive uproar and criticism from China. E.g. British PM Gordon Brown meeting with Dalai Lama in May 2008, U.S. Secretary of State Hillary Clinton in 2011.  China considers this pressure makes it more difficult for separatist groups to push for formal independence.

37  Diplomatic power is also used by Beijing to create a role for itself in the international arena.  e.g. Its participation in persuading Khartoum govt. to accept UNAMID (African Union – United Nations Hybrid Operation in Darfur) forces into Sudan in 2008.  e.g. Moves towards improving relations with potential strategic rival Japan. China hopes that Japan will not see its rise as a threat and with good relations will support it over Taiwan.

38  Political power demonstrated by: ◦ Making gestures to symbolise China’s desire for the peaceful resolution of territorial issues ◦ Making public denouncements of separatist behaviour ◦ Garnering international disapproval for separatist actions ◦ Domestic legislation ◦ Propaganda media ◦ Meetings with separatist leaders

39  Legislation has been used to curb separatist sentiments in Xinjiang and Tibet.  e.g. Policy of forced migration of Han Chinese into Tibet to dilute the culture. This is further supported by the opening up of a train link between Beijing and Lhasa;  e.g. Crushing campaign of religious repression of Uighurs in Xinjiang – including forced abortions, closing mosques and prohibition of teaching the Uighur language in schools.

40  Beijing has passed legislation to make foreign direct investment activities into the state “more effective and efficient”, seeing an increase of FDI of 54.97% to $42.78 billion for the period January to May 2008 compared with a year earlier. An increase in 11,000 new overseas-funded enterprises during this period (Ministry of Commerce).  In 2012 China’s FDI inflow reached $100 billion.

41  Economic instruments of power include: ◦ Encouraging economic links between China and separatist territories ◦ Chequebook diplomacy ◦ “Aid” for oil ◦ Enticing other states with trade and business deals in return for formal condemnation of separatist activity Beijing has emphasised use of economic instruments (along with other “soft” powers of political and diplomatic) as there are less consequences than in the use of military instruments, and the money is helpful in its economic development.

42  “Aid for oil” – in exchange for billions of dollars in aid invested into resource-rich developing states, China receives access to the raw materials (not only oil) which it requires for its economic development. ◦ E.g. Package of loans and aid worth $2 billion to Angola to secure a major stake in future oil production there. Angola govt. uses this to build key infrastructure (roads, railways, hospitals) and in return 25% of her exported oil is sent to China. In 2006, Angola decided it no longer required IMF funding. ◦ E.g. 2007 Congo govt. announced Chinese state owned firms would build or refurbish railways, roads and mines at a cost of $12 billion in exchange for copper ore of equivalent value. N.B. This is 10 times the aid western donors have promised the Congo until 2010.

43 China’s economic assistance to African states has seen it considered the “protector of Africa” – including its $10billion cancellation of debt from African states. The high level of aid provided by China has seen some African states such as Angola withdraw from IMF funding applications (2006). The aid and loans from China are considered by some to be fuelling corruption across Africa as opposed to the IMF funds which has strict loan conditions.

44  The interconnectedness of the world economy and the position China has carved for itself in global economics has left states generally unwilling to confront her.  China has used its economic power to try to quell separatist claims. ◦ E.g. Forging economic growth in Tibet although this has been largely unsuccessful.

45  China’s aid to Pacific region is estimated to be between $100 and $150 million – also known as “chequebook diplomacy”.  This is a policy practised by both China and Taiwan that provides both direct and indirect aid, investment and other bilateral incentives to supportive politicians in Pacific who recognise their sovereignty.  Beijing has provided over $520 million in preferential loans to the 8 Pacific Island states that recognise her – PNG a new sports stadium, Vanuatu a new passenger plane and 2 cargo ships.  Some limited access to resources - 2006 China invested $651 million in a PNG nickel and cobalt mine.

46  2004 – Vanuatu briefly recognised ROC after Taipei offered $US30 million in aid (compared with $US10 million given by the PRC). ◦ Vanuatu Prime Minister Vohor accepted the aid and signed the communique recognising ROC without parliamentary approval. ◦ The diplomatic and political pressure that followed on Vanuatu, PRC alleged increases in aid and a fight when P.M. Vohor punched the PRC ambassador when asked to explain why the ROC flag was flying over the hotel where the Taiwanese rep was posted). The parliament passed a motion of “no confidence” against Vohor, replaced him and annulled the communique. “One China” was restored in Vanuatu. ◦ This kind of “chequebook diplomacy” has successfully limited support for Taiwan (6 states in Oceania recognise Taiwan to China’s 23 states).

47  The third link in the “three direct links” policy is TRADE. Since 1979 mainland China has opened its markets to Taiwanese products, offering them preferential treatment such as tax exemptions or reductions.  As a result, cross-strait trade has rocketed from $US46 million in 1978 to $US44.66 billion in 2002 (971 x increase) and $US 168.98 in 2012.  Since 1991 the mainland has become Taiwan’s number one source of trade surplus.

48  6.9% of investment in PRC from Taiwan, 9.6% from USA.  Taiwanese investment in mainland China by end of 2003 is mainly in manufacturing industries (unofficial estimates at US$100 billion).  Such sizeable investment in mainland China plus the presence of several thousand Taiwanese business people on the PRC limit the options Beijing has to inflict economic damage on the island without affecting itself and its desire for economic development.  Similarly, a declaration of Taiwanese independence would have large and dire consequences on the Taiwanese economy (it prides itself on being an “Asian tiger”).  By fostering such economic growth and co-dependency, the national interests of China are served, reunification is more likely, international standing (particularly with US) is not damaged as economic instruments of power are peaceful means of resolution.

49  Beijing has shown that by using several instruments of power at once is more effective than exercising each instrument in isolation.  Future prospects are that China will use “soft” forms of power over “hard” forms to serve its national interests.  With the world watching, and a growing economy critical to internal stability, China is unlikely to risk using military forms of power unless a separatist territory clearly moves towards formal independence.

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