Will the G-20 Lead to More Engagement With China?

The inside track on the week’s biggest diplomatic gathering.

By , the editor in chief of Foreign Policy.
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It’s fair to say that very little was expected of this year’s G-20 summit in Bali, Indonesia. Although the grouping represents 60 percent of the world’s population and more than 80 percent of its GDP—and is therefore seen as influential but less unwieldy than the United Nations General Assembly—this year’s meeting seemed to be conducted under especially inauspicious circumstances. Russia’s war in Ukraine has cleaved the world into the West versus the rest; a new Cold War is brewing between China and the United States; and the global economy faces rampant inflation, a food crisis, and an energy supply crunch. To make matters worse, on the first day of the summit, missiles struck Poland right as Russia was pummeling Ukraine with rockets, spurring a flurry of panicked diplomatic calls. Initial reports suggested the missiles may have originated in Russia—potentially triggering a discussion to invoke NATO’s Article 5—but subsequent intelligence indicated the missiles may have been errant defensive ones from Ukrainian soil.

Amid these circumstances and low expectations, this past week’s G-20 has emerged with at least some credit. Although there was no official joint communique, participants agreed on a declaration stating that “most members strongly condemned the war in Ukraine.” Among other important agreements, leaders agreed to pace their interest rate rises and address food security challenges, and Washington and Beijing agreed to resume cooperation on mitigating climate change.

What else emerged from the summit? Foreign Policy spoke with three experts on FP Live, the magazine’s forum for live journalism: FP columnists Matthew Kroenig and Edward Alden and Lynn Kuok, a senior fellow for Asia-Pacific security at the International Institute for Strategic Studies. What follows is a condensed and edited transcript. FP subscribers can watch the full 45-minute discussion on video here.

It’s fair to say that very little was expected of this year’s G-20 summit in Bali, Indonesia. Although the grouping represents 60 percent of the world’s population and more than 80 percent of its GDP—and is therefore seen as influential but less unwieldy than the United Nations General Assembly—this year’s meeting seemed to be conducted under especially inauspicious circumstances. Russia’s war in Ukraine has cleaved the world into the West versus the rest; a new Cold War is brewing between China and the United States; and the global economy faces rampant inflation, a food crisis, and an energy supply crunch. To make matters worse, on the first day of the summit, missiles struck Poland right as Russia was pummeling Ukraine with rockets, spurring a flurry of panicked diplomatic calls. Initial reports suggested the missiles may have originated in Russia—potentially triggering a discussion to invoke NATO’s Article 5—but subsequent intelligence indicated the missiles may have been errant defensive ones from Ukrainian soil.

Amid these circumstances and low expectations, this past week’s G-20 has emerged with at least some credit. Although there was no official joint communique, participants agreed on a declaration stating that “most members strongly condemned the war in Ukraine.” Among other important agreements, leaders agreed to pace their interest rate rises and address food security challenges, and Washington and Beijing agreed to resume cooperation on mitigating climate change.

What else emerged from the summit? Foreign Policy spoke with three experts on FP Live, the magazine’s forum for live journalism: FP columnists Matthew Kroenig and Edward Alden and Lynn Kuok, a senior fellow for Asia-Pacific security at the International Institute for Strategic Studies. What follows is a condensed and edited transcript. FP subscribers can watch the full 45-minute discussion on video here.

Foreign Policy: Matt, you just got back from Bali. When news of the missile strike in Poland broke, how did it impact the mood at the summit?

Matthew Kroenig: It did throw the proceedings off course. The leaders were planning on going to visit a mangrove forest on Wednesday morning—a little bit of downtime, an opportunity to interact with each other informally. And then this news broke. At first, nobody knew what happened. Many suspected the worst: that it was a Russian missile strike, maybe intentional, maybe that went astray. And so [U.S. President Joe] Biden called an emergency meeting of the G-7 countries—the closer allies—to discuss what to do. In the end, they decided to wait and gather more information. And as we know now, that was the right decision because turns out it wasn’t a Russian strike but a Ukrainian missile defense interceptor that went astray.

FP: You were at the leaders’ dinner, just a stone’s throw away from some of the world’s most powerful leaders and autocrats. What was that like? How were they interacting with each other?

MK: Yeah, it was fascinating. I must have been invited by mistake, but I was invited to the official leaders’ dinner. There were a couple of hundred people, including [some of] the 18 most powerful people in the world. [Russian President Vladimir] Putin wasn’t there, of course, and then Biden didn’t show up either. It was interesting watching them interact. They’re people just like us. They seemed bored at points in the dinner and looked eager to leave. I was surprised at how little security there was. I could have walked up and patted [Chinese President] Xi Jinping on the back.

Xi and the Saudi crown prince, Mohammed bin Salman, were sitting next to each other at dinner, and many of the other leaders were quiet. They were watching a performance. But Xi and [Mohammed bin Salman] were going back and forth all night, and I was really curious to know what the two of them were talking about.

FP: Lynn, what were the broader takeaways for you, watching from afar?

Lynn Kuok: I think what really struck me was that at a forum that’s usually meant for discussion of geoeconomic issues and to resolve the world’s most pressing economic problems, we saw the war in Ukraine front and center of discussions—and the very first item discussed in the Bali leaders’ declaration. What that demonstrates to me is that we really can’t have a discussion on the global economy these days without a discussion of broader geostrategic issues. And secondly, we saw a very divided response among G-20 members, and I think it suggests to us what the possible responses might be in the event of a Chinese invasion of Taiwan given the egregious transgressions of Russia in invading Ukraine that has received such a lukewarm response from Asia. Many countries in Asia have very close economic relations with China and would be very reluctant to jeopardize that.

FP: Ted, there’s been so much talk this year about a new nonalignment, and the war in Ukraine has in many ways cleaved the world into two camps of sorts. Did you get the sense from watching the summit that with the publication of a leaders’ declaration, maybe some of those divisions are being bridged at least a little bit?

Edward Alden: I would say a little bit, and in fact, the key takeaway for me from the summit was the evidence that both Biden and Xi are very concerned about these nonaligned countries. There is a real competition going on for the rest of the world.

I think that’s why Xi was so public and engaged in this meeting. Remember, he basically hadn’t left China for more than two years other than a brief recent visit to Uzbekistan. You had a very good piece in Foreign Policy recently by my friend Scott Kennedy about Chinese isolationism, and Scott pointed out that this was an opportunity for Xi to break out of that. I think he did in a whole series of important bilateral meetings and a very public presence there at the summit. I also think Biden was doing the same.

FP: Lynn, so many eyes were on the meeting between Xi and Biden. Biden told reporters after the meeting that this was not by any means a kumbaya. But he also shot down any indications that we’re looking at a new Cold War between the two countries. What was your take?

LK: It was a positive development that both Xi and Biden appear to recognize the importance of keeping channels of communication open. I wouldn’t go as far as saying that it’s a huge reason for relief because I think that while that might pull us back from the precipice—if or when we arrive at the precipice—it will not fundamentally change the trajectory of U.S.-China relations, which I think are on a negative downward path.

I think President Biden has toned down his language in terms of framing the competition as one between authoritarian states versus democracies. That framing unnecessarily deepens divisions between the United States and China and, from the U.S. perspective, it alienates potential partners as well.

FP: Ted, you wrote a great piece for us on the Biden administration’s latest set of sanctions that make it much harder for China to access the global semiconductor market. Jon Bateman also wrote a good piece for us on that very issue. Is there anything that you saw this week that might smooth over some of those tensions from last month?

EA: What I was struck by this week was Apple announcing that beginning in 2024, it’s going to start sourcing chips from the new Taiwan Semiconductor Manufacturing [Company] (TSMC) plant in Arizona. You know, TSMC stock jumped [more than] 10 percent on that announcement. If Apple is beginning to hedge its bets in terms of China, that suggests that the broader decoupling we’ve been talking about for a long time is underway. I think it’s important to keep in mind that the tech controls continue to be relatively narrow; they’re on the most advanced chips and chip-making equipment. Jake Sullivan, the [U.S.] national security advisor, has been quite clear that the intention here is to [hurt] Chinese progress at the top end of the technological chain. The challenge for the U.S. is getting allies on board.

FP: But surely they can compel countries and companies to comply, right?

EA: The U.S. can do this through what they call the foreign direct product rule. There is a tool there to do that. But the Biden administration would prefer to have active cooperation from its allies.

The second part of your question is a more interesting one, which is the question of a broader economic decoupling. You could imagine a set of controls on products and technologies that really raise security concerns but still have a very broad and deep economic relationship between China and the West. I think that was German Chancellor Olaf Scholz’s message when he went to China.

MK: One of the criticisms of the G-20 is whether this group of 20 economies can agree on issues. And we saw some of the word-smithing in the leaders’ declaration to present the appearance of consensus. But you do have a lot of working-level experts on the ground. I was told that there were meetings among like-minded nations about this issue of decoupling from China without China in the room, which I thought was pretty interesting.

FP: Matt, do you think Xi got what he wanted to get out of this summit?

MK: I think he did achieve what he wanted to achieve, and at the leaders’ dinner, he probably had the most star power. When he walked in, it seemed like more people stood up and took photos than for anyone else. I ultimately agree with Lynn: I’m skeptical that much is going to come out of this talk about cooperation. There’s just so much confrontation in other areas: decoupling and militarily. I don’t know how we can compartmentalize these few areas of public health and climate change mitigation while there’s this intense competition going on.

EA: I just want to make one more slightly positive point. One of the really concerning things about the U.S.-China relationship in recent months is that there have been no conversations between the two sides. Complete diplomatic isolation. One of the big outcomes of the summit is an effort by both sides to reengage. There’s talk about U.S. Secretary of State Antony Blinken visiting China and maybe at least restarting dialogue. It doesn’t solve the fundamental problems that Matt and Lynn are talking about, but when you deal with the potential for confrontation, you do want countries talking to each other at multiple levels, including military.

FP: Let’s move on to the G-20 leaders’ declaration. We weren’t sure that there was going to be one. Matt, what did you make of the language that emerged?

MK: One thing that surprised me were the third and fourth paragraphs—the third paragraph about the war in Ukraine and the fourth paragraph about Russia’s nuclear threats—because there has been a debate within the G-20 for some time about whether this is just an economic grouping or a broader geopolitical body. I think it would make sense for it to become a broader geopolitical body and deal more with security issues. And this year’s declaration goes to show that you can’t really focus on economic issues without taking into account the geopolitics. Food security was a major issue at the summit. What’s driving food insecurity? The war in Ukraine. So if you want to address food security, stopping the war is the first and most important thing you can do.

Ravi Agrawal is the editor in chief of Foreign Policy. Twitter: @RaviReports

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