The Long View and Deciphering Chinese Foreign Policy

I just completed Rush Doshi's deeply researched book on Chinese strategy. It examines the Chinese actions based on primary sources of speeches of high ranking leaders, records of high level Party and government meetings, guidances and white papers, Chinese media commentaries by influential opinion makers etc. 

Doshi finds the Chinese foreign policy in recent decades as having gone through three stages. The first from 1989-2008, the blunting stage, was triggered by the trifecta of Tiananmen Square demonstrations, collapse of USSR, and US invasion of Iraq. It involved using political, economic, and military tools to gradually and less saliently blunt the US power in the region and over China through a combination of coercion, consensus, and legitimacy. It's been described as the policy of Tao Guang Yang Hui (hide your strength and bide your strength). 

“observe calmly, secure our position, cope with affairs calmly, hide our capabilities and bide our time, maintain a low profile, never claim leadership, and accomplish something.”

The Global Financial Crisis (GFC) of 2008 triggered the second stage of building up China's regional influence through more overt and explicitly directed actions. It involved building up regional institutions like the AIIB and CICA, integrating local economies through the Belt and Road Initiative, and alterting and intimidating neighbours with its land and sea border transgressions.

The latest trifecta of the victory of Trump, Brexit, and now Covid 19 may have triggered the current stage of expanding China's influence globally. Its best manifestation is in the more aggressive posturing by Chinese diplomats in recent times. 

China’s first strategy of displacement (1989–2008) was to quietly blunt American power over China, particularly in Asia, and it emerged after the traumatic trifecta of Tiananmen Square, the Gulf War, and the Soviet collapse led Beijing to sharply increase its perception of US threat. China’s second strategy of displacement (2008–2016) sought to build the foundation for regional hegemony in Asia, and it was launched after the Global Financial Crisis led Beijing to see US power as diminished and emboldened it to take a more confident approach. Now, with the invocation of “great changes unseen in a century” following Brexit, President Trump’s election, and the coronavirus pandemic, China is launching a third strategy of displacement, one that expands its blunting and building efforts worldwide to displace the United States as the global leader...

China initially accommodated a powerful but non-threatening United States after normalization; sought to blunt it after the Cold War’s conclusion led it to see the United States as more threatening; began to build its own order after the Global Financial Crisis led it to see the United States as weakening; and may pursue regional dominance if the United States acquiesces or is defeated in a regional conflict... The core theme animating the Party across that stretch is the search for something that could restore China to its former greatness and would help it achieve the goal of “national rejuvenation.”

Each stage and the transition to the next has been dictated by China's power (economic, military, and geopolitical) gap with the United States and its perception of the US willingness to project power and engage externally. 

A few observations:

1. The Chinese foreign policy is deeply underpinned by a well thought out and consistent ideological basis, which draws from its history and its conception of the role of China in the world. This inevitably also means that its actions are dictated by very long-term considerations. Hence the 100 year journey to become the world's most powerful nation by 2049 or the unstinting resolve to reunite with Taiwan.

This also means that while China may assume opportunistic tactical positions, they will only be means to realise its ultimate goal. Clearly the Americans underestimated the Chinese intentions in the nineties and first decade of the millennium in thinking that integrating the Chinese economy into the world economy would open up internal contradictions and lead to the Communist Party's grip weakening and China becoming more liberal and westernised. 

The combination of long-view and opportunistic posturing gives a two-track nature to the Chinese foreign policy. 

2. The discipline of the Chinese system in staying the course with their policies is remarkable even for a one-party state. While the Communist Party has played a role, the society's collective commitment to the causes espoused by the Party is a critical contributor. It does not appear like the Communist Party and Society in the USSR and other Eastern Bloc nations. 

The Party may be reflecting the society's collective will on the Middle Kingdom Complex or becoming the dominant world economy in 2049 or annexing Taiwan or an industrial policy involving active role for the government in picking winners. This also means that unlike the conventional wisdom that totalitarian regimes are very vulnerable to internal implosions, the Party's grip on power may not be standing on weak foundations. 

3. The evolution of the Chinese foreign policy over the last four decades is perhaps the best illustration of realpolitik at work. It's classic crossing the river by feeling the stones. 

From biding time and building its economy to blunting American regional hegemony to building its own hegemonical structures, the Chinese have displayed remarkable opportunism. 

4. The continuously evolving Chinese positions makes any diplomatic engagement in terms of repeat games with China very difficult. In repeat games, both sides settle down to an equilibrium where they come to anticipate each other's responses. However, the two-track approach with unpredictability about shifting of positions means that repeat games with China is fraught with risks. 

If your interlocutor cannot be trusted and could unpredictably shift course mid-way then the appropriate negotiating strategy is to maximise one's returns by holding on to the Chinese long view and ignoring China's tactical actions. 

5. The Chinese foreign policy is currently in its aggressive building global influence stage using instruments of coercion, consensus, and legitimation in the realms of economics, politics, military, and society. This stage is prone to instability. 

Take the example of Taiwan. China can miscalculate and push forward to annex the island if it feels that either it has acquired the strength and influence to pull it off or if waiting any longer may harden Taiwanese domestic resolve making annexation more difficult.