Caixin: Xi Offers Clues to China’s Future Economic Policy

China is the world’s most important rising power. In two decades, China has moved from the periphery to the center of the international system. Every day and everywhere, China figures prominently in global attention. Wherever one turns, China is in the news – gobbling up resources, soaking up investment, expanding its overseas footprint, asserting itself in its Asian neighborhood, being the sought-after suitor in global governance diplomacy, sailing its navy into new waters, broadening its global media exposure and cultural presence, and managing a mega-economy that is the engine of global growth. China’s global impact is increasingly felt on every continent, in most international institutions, and on many global issues. By many measures, China is now clearly the world’s second leading power, after the United States, and its aggregate economy is due to surpass that of the United States sometime around 2025.

For the past three decades, observers have watched how the world has impacted China; now the tables are turning and it is necessary to understand how China is impacting the world. China’s emergence on the world stage is accelerating dramatically in pace and scope – and it is important to understand the different manifestations of its “going global.”

China’s global expansion did not occur by happenstance. It grew directly out of Communist Party and government policies launched at the famous Third Plenary Session of the Eleventh Central Committee in December 1978 to engage in “reform and opening” (改革与开放). Throughout the 1980s, China “invited the world in” (引进来) and began its hesitant baby steps on the world stage – particularly in overseas educational and science and technology exchanges. By the early 1990s, there was a conscious government policy launched to encourage Chinese commercial firms to “go out” (走出去) and for Chinese localities and organizations to more generally “go global” (走向世界). The encouragement to Chinese companies did not really begin to materialize fully until the mid-2000s, while a considerable international initiatives were being launched by a wide variety of Chinese organizations, localities, and individuals. In 2008, China launched its global cultural blitz, attempting to improve its international image and build its soft power. Militarily, during the same decade the People’s Liberation Army (PLA) stepped up its international foreign exchanges, amounting to more than four hundred annual exchanges. Thus the origins of China’s “going global” date back several decades, even if the manifestations of it are more recent.

Over a longer period of time, a distinguishing feature of China’s modernization mission has been the national pursuit of “comprehensive power” (综合国力). The Chinese have wisely learned one key lesson from studying the experiences of other previous powers: genuine global powers possess multidimensional strength. Chinese strategists have observed the failings of other powers that possessed strength in only a single dimension or a few, and they have thus concluded that it is important to build and cultivate power comprehensively across a variety of spheres: the economy, science, technology, education, culture, values, military, governance, diplomacy, and other sectors. The Chinese grasp that idea that power is comprehensive and integrative, not atomistic. Nor is power today the same as in the nineteenth or twentieth centuries, when industrial and military power prevailed; today it must reflect a strong cultural and normative dimension (soft power) as well. Thus China’s contemporary effort to regain its status as a global power has consciously included multiple dimensions.

But how is China’s newfound comprehensive power manifest globally today, and how will China influence global affairs in the future? These are the grand strategic questions of our era, and the subject of this book.

This book joins an expansive existing literature on China’s rise published over the past two decades. There are many excellent studies.⁸ What makes this study different is its comprehensiveness and its argument. In individual chapters, this study comprehensively covers six distinct dimensions of China’s global emergence (perceptual, diplomatic, global governance, economic, cultural, and security) and multiple manifestations of each. In this way, this study differs from most other “China rise” books that examine only one or two of these dimensions (usually economic or military) and largely describe the country’s ascent in a “vertical” fashion – its asymmetrical encounter with the world’s leading power (the United States) and the historical propensity for conflict to result between the principal established power and the challenging rising power.⁹ Some hype the “China threat.”¹⁰ This book takes more of a “horizontal” approach to China’s “spread” rather than its vertical rise, examining how its impact is expanding across the globe in these six specific spheres.

Some observers have already triumphantly proclaimed that China will “rule the world.”¹¹ This perspective is profoundly overstated and incorrect, in my view. I argue in this book that China has a very long way to go before it becomes – if it ever becomes – a true global power. And it will never “rule the world.” The evidence presented in this book reveals that China has an increasingly broad “footprint” across the globe, but it is not particularly deep. Even its presence varies substantially by sector. China’s appeal as a “model” to others is weak to nonexistent, I argue. Moreover, China’s global posture is beset by multiple weaknesses – not the least of which are domestic – and that the nation’s strengths are not as strong as they seem on face value.

I further argue that China remains a lonely power, lacking close friends and possessing no allies. Even in China’s closest relationships – with Russia, Pakistan, and North Korea – strong elements of distrust percolate beneath the surface of seemingly harmonious state-to-state relations. In other words, China is in the community of nations but is in many ways not really part of the community; it is formally involved, but it is not normatively integrated. It is a member of most international organizations, but is not very active in many (aside from when it seeks to assiduously protect its narrow national interests). I also judge its diplomacy to be hesitant, risk-averse, and narrowly self-interested. China often makes known what it is against, but rarely what it is for. It often stands aside or remains passive in addressing international security challenges or global governance issues. The common denominator to most of China’s global activities and foreign policy is China’s own economic development, which leads to a mercantilist trade and investment posture. I also find that China possesses little soft power, if any, and is not a model for other nations to emulate. For these and other reasons, elaborated in subsequent chapters, I have subtitled the book the partial power.

But perceptions sometimes belie reality. Whether China will become a global power or not, or is already one, it is already perceived as such by many around the world. Global publics already view China as a global power and expect China to overtake the United States as the world’s leading power sometime in the next quarter century. The 2011 Pew Research Center Global Attitudes Project polled publics in twenty-two nations and found that in fifteen countries the balance of opinion was that China will – or already has – replaced the United States as the world’s leading power.¹² China certainly already possesses many of the trappings of a global power: the world’s largest population, a large continental land mass, a manned space program, an aircraft carrier, the world’s largest museum, the world’s largest hydroelectric dam, the world’s second-largest economy, the world’s second-largest military and budget, the world’s annualized highest growth rate over the past three decades, the world’s largest exporter, the world’s largest foreign exchange reserves, the world’s second-largest recipient of foreign direct investment, the world’s largest number of millionaires and billionaires, and the world’s largest producer of many goods.

Despite these attributes, this book argues and demonstrates that China lacks real global power. I argue that China is a global actor without (yet) being a true global power – the distinction being that true powers influence other nations and events. Merely having a global presence does not equal having global power unless a nation influences events in a particular region or realm. Shaping the desired outcome of a situation is the essence of influence and exercise of power.

In these regards, I follow Harvard Professor Joseph Nye’s definitions in his recent book The Future of Power.¹³Nye’s definition of power is similar to the often cited one offered by Robert Dahl: that power is the ability of A to make B do what it would otherwise not do.¹⁴ Professor Nye also argues that, by themselves, resources do not constitute power unless they are used to try to influence the outcome of a situation.¹⁵ In other words: wealth ≠ power ≠ influence. The essence of power, Nye argues, lies in the conversion of resources into influence, which is the exercise of power.

Adopting these definitions of power offered by Professor Nye, this study shows that only in some sectors does China actually exercise global influence: global trade patterns, global energy and commodity markets, the global tourism industry, global sales of luxury goods, global real estate purchases, and cyber hacking. In these areas, China is markedly influencing global trends. Other than in these limited areas, though, this study finds that China does not really influence global events.

Notes

(8) Notable examples include James Kynge, China Shakes the World: The Rise of a Hungr Nation (London: Weidenfeld & Nicolson, 2006); David M. Lampton, The Three Faces of Chinese Power: Might, Money, and Minds (Berkeley: University of California Press, 2008); Phillip C. Saunders, China’s Global Activism: Strategy, Drivers, and Tools (Washington, DC: National Defense University Institute for National Security Studies, 2006); Robert Sutter, Chinese Foreign Relations: Power and Policy Since the Cold War (Lanham, MD: Rowman & Littlefield, 2009); Yong Deng and Fei-ling Wang (eds.), China Rising: Power and Motivation in Chinese Foreign Policy (Lanham, MD: Rowman & Littlefield, 2005); Avery Goldstein, Rising to the Challenge: China’s Grand Strategy and International Security (Stanford: Stanford University Press, 2005); Evan S. Medeiros, China’s International Behavior: Activism, Opportunism, Diversifi cation (Santa Monica, CA: Rand, 2009); David C. Kang, China Rising: Peace, Power, and Order in East Asia (New York: Columbia University Press, 2007); Yong Deng, China’s Struggle for Status: The Realignment of International Relations (Cambridge: Cambridge University Press, 2008); Michel E. Brown et al. (eds.), The Rise of China (Cambridge, MA: MIT Press, 2000); Robert S. Ross and Zhu Feng, China’s Ascent: Power, Security, and the Future of International Politics (Ithaca, NY: Cornell University Press, 2008); Zhiqun Zhu, China’s New Diplomacy: Rationale, Strategies, and Significance (Burlington, VT: Ashgate, 2010); C. Fred Bergsten et al., China’s Rise: Challenges and Opportunities (Washington, DC: Peterson Institute for International Economics and Center for Strategic and International Studies, 2008).

(9) See, for example, Robert S. Ross and Zhu Feng (eds.), China’s Ascent: Power, Security, and the Future of International Relations (Ithaca, NY: Cornell University Press, 2008); John Mearsheimer, The Tragedy of Great Power Politics (New York: Norton, 2001); Aaron L. Friedberg, A Contest for Supremacy: China, America, and the Struggle for Mastery in Asia (New York: Norton, 2011).

(10) See, for example, Herbert Yee and Ian Storey, The China Threat: Perceptions, Myths, and Realities (London: Routledge, 2002); Richard Bernstein and Ross Munro, The Coming Conflict with China (New York: Knopf, 1997); Ross Terrill, The New Chinese Empire (New York: Basic Books, 2003); Steven Mosher, Hegemon: China’s Plan to Dominate Asia and the World (San Francisco: Encounter Books, 2000); Ted Galen Carpenter, America’s Coming War with China (London: Palgrave Macmillan, 2006).

(11) Martin Jacques, When China Rules the World (London: Allen Lane, 2009).

(12) Pew Global Attitudes Project, “China Seen as Overtaking U.S. as Global Superpower,” http://www.pewglobal.org/2011/07/13/china-seen-overtaking-us-as-globalsu….

(13) Joseph Nye, The Future of Power (New York: Public Affairs, 2011). See, in particular, the definitions and discussion in chap. 1.

(14) Robert Dahl, Who Governs? Democracy and Power in an American City (New Haven, CT: Yale University Press, 1961).

(15) Nye, The Future of Power, op. cit., p. 8.

Reprinted from CHINA GOES GLOBAL: The Partial Power by David Shambaugh with permission from Oxford University Press, Inc. Copyright © 2013 by Oxford University Press, Inc.