The recent stock market turbulence and rising questions about Xi’s competence mean China’s leadership has bigger issues to worry about than cybersecurity or bilateral trade.
- By Feng ZhangFeng Zhang is a Fellow in the Department of International Relations at the Australian National University’s Coral Bell School of Asia Pacific Affairs and an adjunct professor at the National Institute of South China Sea studies in China. He is the author of Chinese Hegemony: Grand Strategy and International Institutions in East Asian History.
There has been surprisingly little fanfare in China in the lead up to President Xi Jinping’s first official state visit to Washington. China’s Foreign Ministry didn’t officially announce the visit until Sept. 16 — less than a week before Xi landed in Seattle and just nine days before his state dinner at the White House. And there seems to be fewer hagiographies about Xi and his foreign-policy accomplishments in state media than would be expected before a major trip like this one. In July, the scholar Liu Yawei compared Xi’s visit to former paramount leader Deng Xiaoping’s celebrated 1979 trip to the United States. According to a senior source in Beijing, however, this comparison annoyed Xi — perhaps because it hyped a visit that Xi didn’t want hyped.
That’s strange because Xi has certainly been prioritizing both the bilateral relationship and this trip, despite the fact that Xi has formally met with U.S. President Barack Obama twice before — once during the U.S.-China Sunnylands Summit in June 2013 and Obama’s November 2014 visit to China. In addition to which, a state visit will engender some of the respect Xi craves from the global community. And as Xi is widely known in China for his political skills and great ambitions — like what he calls “the great renaissance of the Chinese nation” — this U.S. visit will also be an important opportunity for him to demonstrate his leadership on the global stage and the arrival of China as a world power.
Xi’s own ambitions aside, there are three possible explanations for Beijing’s attempt to lower expectations for Xi’s visit: that the Foreign Ministry and other bureaucracies responsible for planning the visit are incompetent and disorganized; that turmoil in the Sino-U.S. relationship is distracting from the visit; or that domestic and international policy uncertainties are compelling the leadership to take a low-key approach.
The truth is probably a combination of the latter two explanations. The uncertain nature of the Sino-U.S. relationship certainly plays a role. Currently, Washington is accusing Beijing of conducting cyberattacks against the United States, including espionage and widespread theft of sensitive U.S. government and commercial data. And Washington objects to Beijing’s construction of artificial islands in disputed parts of the South China Sea — islands that further allow China to project power in an area in which the United States has strong strategic interests. Needless to say, 2015 has been a tense year for relations between the two countries.
The most compelling reasons, however, are probably domestic. Xi’s signature political strategy, his massive anti-corruption campaign, seems to be running into trouble. Tackling both “tigers,” high-ranking Chinese Communist Party officials, and “flies,” their low-ranking counterparts, Beijing has netted hundreds of thousands of officials. But the extraordinary scope and scale of the anti-corruption drive is beginning to generate a backlash from the bureaucracy. In August, the State Council, China’s cabinet, punished 59 officials from 7 provinces for “sitting on their jobs and doing nothing” — an unprecedentedly high number — and evidence that the anti-corruption campaign has generated a mentality among Chinese officials that doing less is safer than doing more.
Unfortunately for Xi, his problems as a leader extend beyond the political. After sustaining a double-digit annual growth rate for much of the last three decades, China’s economy has been struggling. Growth in investment — a central pillar of Chinese growth — is slowing down, exports are seeing a sharp drop, and a huge expansion of debt is threatening financial stability. Worse, over the past two months, China has experienced three rounds of stock market drops that shook investor confidence, and an unexpected currency devaluation that unnerved global markets. Many people now doubt the Chinese leadership’s long-assumed competence in economic management. And for the first time since he took office in late 2012, there is worry that perhaps Xi himself is not a competent steward of the country or its economy.
Moreover, these economic difficulties are affecting Xi’s most cherished and ambitious foreign-policy initiative: “One Belt, One Road,” or OBOR. Announced in late 2013, OBOR is a strategy of building a new Silk Road economic belt across the Eurasian landmass and a maritime Silk Road from the Chinese coast to the Indian Ocean, Oceania, and the Middle East. Supporters of OBOR like to point out that this initiative encompasses 65 countries, 4.4 billion people, and an economic output of $21 trillion. The problem is that with the economic slowdown, the Chinese government — and the state-owned enterprises that are supposed to be the main actors in OBOR — lack the money and resources to achieve their ambitious objectives. Beijing is sounding the retreat: It now seems to be quietly telling the media to scale back its promotion of OBOR. And in fact, OBOR may cease to become a distinctive foreign-policy initiative in itself: Beijing is now equating OBOR with foreign economic cooperation.
The changing fate of OBOR is indicative of larger shifts in Xi’s overall foreign-policy approach. After surprising proactiveness over the past few years, Chinese foreign policy has now entered a period of reflection and readjustment. Xi himself may be rethinking his foreign as well as domestic policies — because some of them are damaging the authority and popularity he so quickly built up after taking office.
It is against this backdrop of domestic policy shifts and uncertainties that Xi is visiting the United States. Given these challenges, lowering expectations for the visit makes good sense for Xi. Raising expectations too high would lead to further disappointments in China if the achievements of the visit prove modest. And modest achievements — like small steps on fighting climate change and strengthening global cybersecurity — are all that we should expect from this visit.
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