Post-rapprochement

Until recently, the West had assumed that China would eventually adopt a liberal democracy and a full market economy. This conviction was grounded in the West’s own experience and history of capitalism and its belief that liberal democracy was needed for capitalism to flourish and function effectively. The collapse of the Eastern bloc in 1989 confirmed this conviction. Liberal democratic capitalism was an efficient system; it provided the highest level of collective wealth and dignity in the 20th century.

This deeply rooted liberalisation premise coupled with concrete economic, cultural and geopolitical strategies determined the West’s foreign policies towards China for decades. In the 1970s, the United States began pursuing policies of normalisation and intended to open up to China after years of isolation. Initiated by Richard Nixon and Henry Kissinger, this policy was broadly followed by subsequent U.S. administrations.

The West had assumed that China would eventually adopt a liberal democracy and a full market economy. This conviction was grounded in … its belief that liberal democracy was needed for capitalism to flourish and function effectively.

Over the years, America continued to grant China access to international organisations, nurtured economic trade, people-to-people exchanges, and even offered joint military activities. The intent and hope was always to liberalise and draw China closer to the West. Europe followed a similar policy of détente by focusing on economic trade. Great Britain, France, and Germany engaged in deeper diplomatic relations and accounted for most of Europe’s trade with China in the 1970s and 1980s.

However, the U.S. continued to determine the course of diplomatic relations. Its goal was to weaken the Soviet Union and contain communism, especially after the USA lost three wars in Asia during the Cold War period. China subsequently opened up and, since the 1978 reforms, started benefiting tremendously from its gradual introduction of liberal market forces. After Chairman Mao Zedong’s death in 1976, China also adapted its political system from a totalitarian to a modern authoritarian collective leadership system.

China did open up but also continued to upset Western expectations. China was accused of either violating human rights domestically or ignoring laws internationally. In addition to China’s rising economic power, China’s rapidly developing military strength triggered concerns in the West due to China’s market protectionism and lack of political liberalisation. Retrospectively, according to Kurt Campbell and Ely Ratner, the relationship between China and the West, especially the U.S., unfolded as a regression from presumptuous optimism and rapprochement to scepticism and attempted containment.

For some time, America continued to remind China of the ‘universality’ of Western liberal values. In the 1980s, George H.W. Bush asserted that China could not just import Western products ‘while stopping foreign ideas at the border’. In the 1990s, Bill Clinton declared that without freedom and democracy, ‘China will be at a distinct disadvantage, competing with fully open societies’. George W. Bush, who was occupied with America’s fight against terrorism and deregulating an economy leading to the biggest recession in history, said that ‘the people of China deserve the fundamental liberty that is the natural right of all human beings’. In the meantime, China’s president Hu Jintao emphasised the country’s ‘peaceful rise’ to reassure the West. From 2009, however, the diplomatic relationship between the U.S. and China reached a low point. Barack Obama sought to contain China by rebalancing military forces and excluding China from the Trans-Pacific Partnership (TPP). He reminded China that it should ‘uphold the very rules that have made [China] successful’.

Only a few scholars questioned whether China needed a Western-type democracy to lift millions out of poverty and manage the downsides of rapid and uneven GDP growth, which had characterised the first three decades of China’s development. In 2004, Cambridge professor Peter Nolan argued that China was embarking on its own ‘Third Way’. It was a gradual reform path, which did not mean a gradual withdrawal of the state to give way to a liberal order. On the contrary, it was the continuation of the one-party system and a strong state to ensure China’s stability and to help ‘marry the “hedgehog” of market dynamisms with the “snake” of social cohesion’. This ‘symbiotic interrelationship between state and market’ was, to Nolan, not simply a position between socialism and capitalism but also something that China had already practised for centuries and that was deeply ingrained in China’s culture.

BRICS became an increasingly known acronym, not only in terms of potentially large markets for Western products and outsourced supply chains but also for the rise of a parallel world order and the start of the West's relative decline. 

China could draw upon its millennia-old history of an ‘agrarian empire’ and Confucian culture to propagate ‘state benevolence’ and ensure long periods of stability and prosperity. For Nolan, Hu Jintao’s focus on building a ‘harmonious society’ and ‘balancing between GDP growth and people’s welfare’ was a clear expression of that culture and history. Four decades after Deng Xiaoping initiated the reforms in 1978, China has still not turned into a liberal democracy or a free market economy, and it is even more unlikely that such changes will happen any time soon. On the contrary, since President Xi Jinping assumed office in November 2012, China’s ‘exceptionalism’ has never been so clearly and actively promoted at home and abroad. At the 19th National Congress of the Communist Party in October 2017, President Xi heralded the beginning of a ‘new era of socialism with Chinese characteristics’.

The BRI goes further than China’s industrial policy agenda. For the first time. China offers, as President Xi promoted during the 19th National Congress, ‘a new option for other countries and nations who want to speed up their development while preserving their independence’, which is based on ‘Chinese wisdom and a Chinese approach to solving the problems facing mankind’. This new option refers to a multitrillion dollar development programme to boost growth through strategic and cross-border infrastructure projects and the establishment of new economic supply chains that connect China with Europe through the integration of Eurasia.

Domestically, BRI clearly breaks with Deng Xiaoping’s old dictum to ‘keep a low profile and bide your time’, by which he meant that ‘by no means should China take the lead’. For Xi Jinping, China has ‘grown rich and become strong’ and is now ready to take the lead as a ‘constructor of global peace, a contributor to the development of global governance, and a protector of international order’. However, Xi Jinping is not offering to renew the existing U.S.-dominated global liberal order. Instead, with BRI he is proposing an alternative development model that has the potential to become the platform of a new multilateralism.

President Xi mentioned BRI for the first time during his visit to Kazakhstan in 2013, but Western governments only took more serious note of this unparalleled development programme at the inaugural Belt and Road Forum for International Cooperation (BARF) in Beijing in May 2017. While many non-Western high-level participants praised China’s modern Silk Road as the ‘project of the century’, Europeans and Americans are only just beginning to realise its significance. Their scepticism towards China meant that they refused to sign BARF’s joint trade statement.

Xi Jinping is not offering to renew the existing U.S.-dominated global liberal order. Instead, with BRI he is proposing an alternative development model that has the potential to become the platform of a new multilateralism.

These ambitious policy agendas have been defined at a crucial moment. When President Xi assumed office, he saw the need to depart from the previous high-growth, GDP-focused development model and instead focus on rebalancing a debt-driven economy; shifting from rapid to high-quality and sustainable growth; alleviating poverty, especially in previously neglected rural Western regions; and countering high levels of environmental pollution.

At the same time, as Professor Carl Minzner highlights, Xi Jinping faced spreading decay, lack of discipline inside the Communist Party, ideological polarisation, and a looming legitimacy crisis outside the Party. During his first five-year term, Xi Jinping was also fighting widespread corruption while increasingly centralising power for himself and a few trusted aides. The tightening of the party-state apparatus and reinstalling of ‘party discipline’ also marks China’s new era. For President Xi, a strong party and state are deemed necessary to ensure long-term stability and implement those ambitious policy plans. This has culminated in the abolition of the presidential term limit, allowing President Xi to stay in office beyond the usual two five-year terms.

During his first five-year term, Xi Jinping was also fighting widespread corruption while increasingly centralising power for himself and a few trusted aides.

The West has largely received these developments under Xi Jinping with scepticism, hostility, and a steady drumbeat of China-bashing. The Economist denounced Xi Jinping’s strong leadership as a return from ‘collective governance’ to a ‘single man rule’ and stepping from ‘autocracy into dictatorship’. For Carl Minzner, China’s new era ultimately means ‘the end of reform and opening up’. Made in China 2025 is judged as ‘putting industrial policy ahead of market forces’, which will mainly promote the development of indigenous technologies while adding a new set of barriers to foreign competitors. The BRI is denounced as China’s self-serving ‘Marshall Plan’ because it mainly helps to integrate its underdeveloped Western regions, offset industrial overcapacities, secure future international markets, and assert its geopolitical power in Eurasia and other emerging Belt and Road economies.