Carlos Aquino*
China is a
major actor in the world economy and international politics. It is the second
biggest economy in the world and by the end of this decade it will become the biggest
in the world. It is already the biggest destination for more than 130 countries
exports of goods, a major investor in many developing countries, and the main lender
for many of them.
Under Xi
Jinping leadership China´s foreign policy has become more assertive and with
Trump policy of confronting China (that to a big extent will be followed by Biden[1])
its competition with U.S. is seen as inevitable.
In this
article a review of China’s foreign policy is given. First, its foreign policy
before Xi Jinping is analyzed; Second, the current China foreign policy is
reviewed; Third, China foreign policy toward Latin America is seen; and Last,
some conclusions are given.
A. China´s Foreign Policy before Xi
Jinping
When the People
´s Republic of China was created in 1949 it was a poor country, and its priority
was to ensure its independence, and later when it broke with the Soviet Union, it
aims was to fight against the hegemonism, both of United States and the Soviet
Union.
By the end
of 1969, China had established diplomatic relations with more than 50
countries, double of what it had in 1955.
It established
5 principles of peaceful coexistence that have guided much of its foreign
policy. They include: “mutual respect for sovereignty and territorial
integrity, mutual non-aggression, non-interference in each other's internal
affairs, equality and mutual benefit, and peaceful coexistence”[2],
In the
decade of the 1970s when it saw the opportunity offered by the United States, China
established relations with this country and with many others in the West, to
counterbalance the Soviet Union. In October 1971 China regains its seat in the
United Nations and as a member of the five country Security Council.
It also had
as the cornerstone of its foreign policy the maintenance of its territorial
integrity (that as many countries as possible recognize that Taiwan is part of
China).
China in
December 1978 decided to undertake reforms and open its economy to get out of
the backwardness in which it had been, especially compared with countries such
as Japan and South Korea.
Under Deng
Xiaoping leadership China leaves behind its planned economy system to take
advantage of the capital, know-how, and markets of the West.
To ensure
its growth, China sought to expand relations with many countries, considering
the provision of natural resources, which it does not have in abundance
compared to its needs.
Chinese
economic growth since 1979 is spectacular. In 2010 it became the second largest
economy in the world surpassing Japan.
Deng
Xiaoping argued that Chinese foreign policy should be characterized by
"hiding strengths and waiting", "hiding weaknesses", and
not "taking a leadership position". He argued to keep a low profile (taoguang
yanhui 韬光养晦) in international affairs.
The
priority was economic growth and China should not be distracted from this goal.
China sought
to resolve its problems with its neighbors so that this does not distract it
from its goal of economic development. At the end of the 1980s China settled its
problems with the Soviet Union (who became Russia) and with South Korea
established diplomatic relations in 1992 for example.
B. China Foreign Policy in the present
It is said
that China foreign policy has changed from Deng Xiaoping policy of “hide your capacities,
bide your time” to Xi assertive foreign policy. Xi assumed power in 2012.
But things
began to change before Xi became leader of China. By the end of the 2000s, the outcome
of the great international financial crisis of 2008-2009 began to change how
China saw the world and its position in it. The Chinese economy continued to
grow while many countries, especially in the West, suffered economic crisis. The
Chinese felt more confident in its economic, and political system.
Besides
this, Chinese economic growth began to generate some apprehension abroad, although
China emphasized that its rise will be peaceful, that it will be a responsible
superpower, that it will seek to democratize international relations, and that
it will support multilateralism.
In fact,
China presence began to be felt all over the world. By the beginning of the XXI
century, it became the engine of the world economy, and its influence on the
movement of the price of raw materials became evident. It is in this scenario that
Xi Jinping, the most powerful leader that China has had since Mao Zedong (Xi
was elected Secretary General of the Communist Party of China in November 2012
and President of the country in March 2013) took office. In March 2018 the
National People's Congress removed term limits for the President and Vice
President, so paving the way for Xi to remain in power if he wishes to do so (and
many think he wish that).
China began
to strengthen its presence in the world, especially in its immediate area, East
Asia. Its disputes with Japan, Vietnam, and its greater presence in the South
China Sea are proof of this.
China wants
to achieve a developed country status by 2049. It aims to reach the
rejuvenation of the nation, and the Chinese dream (proposed in 2013: to achieve
a strong, civilized, harmonious, beautiful China). China wants to regain the
place it had before its forced opening to the world at the middle of the XIX
century. For most of the last 2000 years China was the biggest and most advanced
economy in the world, even right before its forced opening with the Opium war
of 1839-1840.
China wants
to have a greater voice in international affairs. It would like to contribute
more funds to the World Bank, the International Monetary Fund, but the US will
not let it (as this will mean a major voice of China on those organizations,
with the corresponding decrease of influence of the US).
Anyway, China
is also creating mechanisms to have a greater financial presence in the world,
to make better use of its huge international reserves, and (through
institutions such as the Asian Infrastructure Investment Bank, the New
Development Bank, the Silk Road Fund), etc., participate in the financing of
development and infrastructure of developing countries.
It has
plans to improve its industrial structure with Made in China 2025 (revealed in
2015), and the Belt and Road initiative (announced in 2013, which has five
priority areas of cooperation: policy coordination, connectivity of
infrastructure, trade facilitation, financial cooperation, and people-to-people
exchange).
China wants
to establish itself as the champion of multilateralism (as opposed to Trump's
unilateralism, something that the new Biden administration said will reverse). China
stands as the standard-bearer of globalization, as it has been the greatest
beneficiary of it.
It has a
win-win proposal, of South-South cooperation, and continues to present itself
as the older brother of developing countries.
Trump's rise
presented a challenge for China. Trump is gone but the major guidelines of its foreign
policy will continue, with the difference that to face China the Biden
administration has said that it will work with its allies and like-minded parties.
In fact, China
presents a major challenge to US hegemony, the only truly one up to now. The Soviet
Union was considered a challenger but in fact it could not win that
competition. Even if in military terms it achieved some parity with US in
economic terms it was never a competitor. At some point in the 1980s even Japan
was considered by some people a challenger to US in economic terms but with the
burst of its bubble economy at the beginning of the 1990s that was not the
case. Japan lacked two things to have challenged the US. It direly lacks
natural resources and military strength (being dependent in the US for its security).
China is different.
It will become the biggest economy, among other reasons thanks to its huge internal
market, and its military strength is increasing with time. But still is behind the
US in some advanced technologies like semiconductors, AI, nanotechnology, etc.
With the
Biden administration US is preparing to keep ahead in the advantages that still
have vis a vis China, and this will assure competition between them, will
persist. The question for some is if this competition will escalate and become a
military one. Some see China and US falling into the called Trap of Thucydides,
where the hegemon struggles to preserve its position against an emerging power
(as was the case of Sparta against Greece).
Already China
influence is bigger in some places, like in Africa, and is becoming bigger in East
Asia, and Latin America. Let´s focus in Latin America region.
C. China foreign policy in Latin America.
China presence
in Latin America is becoming bigger by the time. Without considering Mexico,
that have a strong relationship with US, China already is the biggest economic
partner of the region, one of the main investors and the main lender.
The People´s
Republic of China began establishing diplomatic relations with most of Latin America
countries in the 1970s after recovering its seat in the United Nations. But
economic relations were still weak, and it began to increase after the 1990s.
At first China
was putting emphasis in having Latin American countries switch recognition from
Taiwan. Of the 16 countries in the world recognizing Taiwan, several of them (and
the biggest ones), are in Latin America, like Paraguay and Nicaragua.
Economic
relations between China and Latin America began increasing from the 1990s, thanks
to the growing appetite of China for natural resources of the region. Specially
in South America countries have plenty of copper (Chile and Peru), iron (Peru,
Brazil), oil (Ecuador, Colombia, Venezuela), soybeans (Argentina, Bolivia, Brazil),
etc. Also, cheap manufactured goods from China were demanded from the region.
The region
benefited specially from the increase in the price of many primary goods that occurred
between 2002-2003 to 2011-2012. China strong demand for those goods was the
reason. In this way China become the biggest export market of several of them,
beginning with Peru and Chile, where more than half its copper (its main product
exported) goes to China.
Also, from
the 1990s and specially from the 2000s onward, China began to invest in the
extraction of natural resources, especially iron, copper, and oil.
But China
also became important for countries like Venezuela, Ecuador, and Argentina,
that after losing access to the international capital markets, began receiving
loans from China.
In this way
China become the major export destination for many Latin American countries, one
of its main investors, and for several of them their major, and unique lender. Moreover,
up to now, 19 countries in the region have joined China Belt and Road
initiative (BRI).
China have
tried to work with Latin American countries through the China-CELAC forum, but it
has not been easy. The first forum of the China and the Community of Latin
American and Caribbean States (CELAC) was in 2015 in Beijing, but the region does
not have a common voice vis a vis China. That is why, most of the relations between
China and the region is done bilaterally.
Given the economic
structure of the region, dependent in the export of primary goods, its economic
reliance in China will increase. Also, as China invests more in infrastructure
projects and the region is in much need of this kind of investment, China involvement
in the region in this aspect will increase, helped by the BRI to which most of
the countries have joined.
Also, the
COVID-19 pandemics in a sense is getting China closer to the region as many of
them will rely in the Chinese vaccines. China Sinopharm and Sinovac, two of its
companies manufacturing them, are becoming main providers of the vaccines[3]
for some countries, like Peru.
China growing
presence in Latin America rose suspicion in the US as the region is considered its
backyard. One area of possible conflict will be when the countries in the region
adopt the 5G technology. US has pushed other countries, like United Kingdom and
Australia, to exclude Chinese companies like Huawei, from participating in the
nationals 5G network. Ecuador under Lenin government got a loan form the US to
prepaid Chinese loan with the condition that it excludes Chinese technology in
this field[4].
But it seems that the next President of Ecuador could be a protégé of former President
Rafael Correa, Andres Arauz, a good friend of China, and things could reverse.
*Carlos Aquino is Director of CEAS
[1] See US White House: “Interim
National Security Strategic Guidance”, march 2021: https://www.whitehouse.gov/wp-content/uploads/2021/03/NSC-1v2.pdf
[2] China´s MOFA website: The Five Principles of
Peaceful Coexistence: https://www.fmprc.gov.cn/mfa_eng/wjb_663304/zwjg_665342/zwbd_665378/t1179045.shtml#:~:text=They%20include%3A%20mutual%20respect%20for,mutual%20benefit%2C%20and%20peaceful%20coexistence.
[3]Latin America turns to
China and Russia for COVID-19 vaccines:
[4] Financial Times: US development bank strikes deal to help Ecuador
pay China loans.
https://www.ft.com/content/affcc432-03c4-459d-a6b8-922ca8346c14
