Catching the Dragon: Challenges and prospects for U.S.-China relations

How will the erosion of American power and China’s strategic interests shape the rules and institutions of a new international system?

While China’s hegemonic power has reached its zenith in the last two decades, Washington’s ability to cope with a new form of political, economic and military power under the leadership of the current generation of Chinese leaders has produced limited results so far.

Beijing’s hegemonic ambitions represent a direct challenge to the stability of the post-Cold War strategic architecture in the Asia-Pacific region. Official remarks stress the importance of cooperation between the two superpowers. But the rise of China has inaugurated a new phase of strategic rivalry with Washington, culminating in a series of tensions over issues such as trade conflicts, Yuan devaluation, cyber espionage, and territorial claims in the South China Sea.

Despite initial diffidence, Washington has embraced a new diplomatic framework that formally recognises China as a superpower and its pursuit of a “peaceful rise”.

Political priorities for the new CCP leadership

The focus of the debate relies on two main paradigms. In one, China will initiate a new phase as a global power fully integrated in a new international system, willing to provide an important contribution to regional and international stability. In Mearsheimer’s realist vision, China is instead pursuing military and economic supremacy in the region, aimed at imposing a Chinese version of the Monroe Doctrine.

Since Xi Jinping became President, Beijing has vigorously pursued the protection of its core interests worldwide.

China has replaced its former scepticism over the multilateral system with a new orientation towards playing a relevant role in organisations such as the SCO, ASEAN, and APEC. China also has a leading position in the Asian Infrastructure Investment Bank that, coupled with the recent IMF decision to grant the Yuan the status of reserve currency, represents a further attempt to challenge the American-led global financial power.

Domestic reforms: an arduous path

The current Chinese Communist Party (CCP) leadership strongly advocate a pursuit of a Chinese “Manifest Destiny”. The model proposed by the new leadership foresees the consolidation of China as a global player and pursues a new domestic path characterised by broader structural reforms in order to inaugurate a new phase of economic development.

President Xi’s rise to the top level of the power structure inaugurated a period of great domestic reforms and cunning foreign policy vision. He has worked intensely to reduce the influence of top leaders loyal to the former factions and to carve out his own political agenda.

In the early 2000s, Hu Jintao tried to impose his own personal agenda based on the Scientific Model of Development, but failed due to a lack of support from member of the Jiang-Zhu faction. Unlike Hu, President Xi has proved a determination to consolidate his personal power, by dismantling piece by piece the system of collective rule.

In the last few years, Xi has launched a massive anti-corruption campaign inside the CCP, widely seen as a strategy aimed at removing adversaries and reducing the political power of factions led by high-ranking members such as Zhou Yongkang. A former member of the Standing Committee and powerful éminence grise of the police and security apparatus, he was was recently sentenced to life imprisonment for corruption.

President Xi has also managed to take control of several committees, including the Central Military Commission, effectively concentrating in his hands government reform, economic pacification, military power, and domestic security. His approach tries to reduce the power of the hardliners elites, the main obstacle to the structural reforms urgently needed to achieve the so-called “Great Rejuvenation of the Chinese Nation” to transform the country into a modern and more powerful nation than today.

A comprehensive package of economic reforms remains a priority for the CCP. Failing to achieve these goals would ultimately generate economic stagnation, social tensions and political decline, scattering the very foundations of its power.

Strategic vision: Asia-Pacific Scenario

In July 2010, President Obama inaugurated a new phase of America’s strategic commitment to the Asia-Pacific.

This increased tensions with Beijing, who are concerned about a potential containment of their regional ambitions. A direct consequence of Beijing’s assertiveness on territorial issues has been the increasedmilitarisation of the region and the growing concern among Washington’s allies about their limited response.

In 2013, the Chinese Navy expanded its power projection in the East China Sea with the establishment of an Air Defence Identification Zone during territorial disputes with Japan, and the navy is also increasing their presence in the South China Sea despite protests from South East Asian countries.

As a response, the Obama administration has underscored its commitment to protect the freedom of navigation and overflight, preventing Beijing to impose new forms of regional hegemony through direct control of the vital sea lanes in the East China Sea.

In the foreseeable future, the expansion of its maritime power will allow China to increase power projection over the South China Sea and establish a Sinocentric order. Southeast Asian countries, unable to oppose Beijing’s regional hegemonic power and strongly dependent on Chinese trade, will ultimately accept this new geopolitical shift, given their scepticism over Washington’s ability to uphold the regional status-quo.

While the risk of direct conflict between the two major powers is low, the chance of a miscalculated move persists. Additionally, Washington’s countermeasures to decelerate China’s naval expansion could push regional allies to take a more decisive stand and eventually pursue their own strategic agenda similar to that of Japan under the Abe administration. 

By 2025, the scenario where China emerges as a revisionist power as depicted by the Realist school is unlikely to occur. Despite signs of economic slowdown, broader economic and financial reforms strongly advocated by the current Chinese leadership could mitigate the risk of another lost decade and the consequent decline of the Chinese economic model, as experienced by the twilight of the Asian Developmental States model in the 1990’s.

Neither Western powers nor the U.S. are powerful enough to prevent China from achieving its hegemonic ambitions, but they can play a pivotal role in ensuring that China will abide to rules and institutions. These can guarantee the stability and peaceful development of the future international system.

by Daniele Ermito

sourche: http://globalriskinsights.com/2016/02/catching-the-dragon-challenges-and-prospects-for-u-s-china-relations/