What are the Opportunities for China in Today’s World?

By Wu Mengke,

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What are the Opportunities for China in Today’s World?

By Wu Mengke,

World Affairs

What is the "mess" in the world today?

that to analyze whether there is any "opportunity" for China, we must first of all understand what kind of world today’s world is. It is true the present world order is undergoing very important changes and may even be the starting point of a new era. In my opinion, these changes are mainly manifested in the following three aspects:

First, the concept of Western world is changing. The western world with Europe and the United States as the main body has been the leading global force in the past few decades, now this dominant force is undergoing significant changes, Europe is changing, the United States is changing, and Europe-U.S. relations is changing. Just because the West world is the dominant force in the world for a long time, their changes will pose strong impacts on the global order. Why is Trump, the U.S. new president, receiving so much attention? Because the United States is too strong, and is the superpower in the world today. A small "bad guy" influence is rather limited, but the U.S. “bad” behavior influences disastrously. Before, at the least in the Western views, the United States was a constructive force, and a good force. But now, the United States under Trump, at least in the eyes of many Europeans, is becoming a huge destructive force, and is destroying the world order.

The Western world, as we usually refer to, is based on a set of so-called common values, such as democracy, human rights, rules, etc.. At least the so-called mainstream politicians are still holding on to them. But Trump does not seem to have any awareness, such as his statements about Muslims and immigrants, the threat of leaving the World Trade Organization (WTO), etc.. Many Europeans are beginning to wonder whether these common values still exist between them. The existing Western concept also depends on its alliance system, and the most fundamental one is the Trans-Atlantic Alliance system, with NATO as its main carrier. Who is the Alliance adversary, who its allies, and who its partners was very clearly defined in the past. But now, in Trump's view, there is no allies to speak of, only interests, no more than business partnership.

Second, globally, there has emerged a wave of so-called "counter-globalization" and "anti-globalization". The globalization process has been going on for many years, and we are all used to it and think that this is a general trend. It is generally believed that this trend will continue to move forward, but for the moment, globalization process is indeed meeting with strong resistance. If Trump forcibly fulfills some of his campaign promises, the global industrial chain would surely suffer damages. China will also be affected by these current changes, and after all has been deeply integrated into the global industrial chain. This also shows that the current wave of counter-globalization and anti-globalization is world-wide, and its influence is not limited to the West alone.

Third, There is a resurgence of so- called populism and nationalism across the world. If this populism and nationalism take place only in marginal regions and small counctries, the situation is generally controllable. But if the Western major countries act the same way, which, then, is likely to bring a huge uncertainty to the world.

that Trump came to power as the biggest event in 2016, because of the U.S. influence on the world. After World War II, the United States led the design of the international political system represented by the United Nations, and the international economic system represented by the GATT (replaced by WTO in1995), the World Bank and the International Monetary Fund, as well as the security system headed by the United States and networked by a series of military alliances, with which to exert a comprehensive and extensive influence on the world. The influence of Trump's coming to power on the world political system is the decline of U.S. willingness to take responsibility as a leader in the world. From the economic perspective, Trump pays more attention to the economic benefits within the United States, especially "compensates" the globalization victimized strata, the measures include requiring U.S. companies to create more employment opportunities domestically, and not making global industrial layout for profit purpose. The main impact of his economic policy is on the advanced manufacturing sector, which has a large margin of profits and may plan more production bases in the United States because of pressure from the government. The low-end manufacturing sector is unlikely to return to the United States, but will only move from one developing country to another, such as from China to Vietnam and Bangladesh. The service industry and high-tech industry, in which the United States has a global comparative advantage, may be opposed to Trump's policy of economic nationalism, because other countries retaliatory measures might do harm to their expansion overseas. From the security perspective, the Trump Administration will continue the "shrink" strategy of the Obama Administration, but in different ways: on the one hand will compress the military interventions, limit as less as possible intervention areas and issues; on the other hand, demand the Allies to take more economic and political responsibilities on security issues.

East Asia is still the focus of global strategy of the United States, the overall goal of balancing China does not change, but the Obama Administration carried out "C-shape balance", while the Trump Administration may carry out "dot-shape balance": to ease relations with Russia and try to "neutralize" it, then put the balance policy on China into operation through some specific issues. At the moment, the issues that can be exploited are, first of all, the Korean Peninsula nuclear issue and the Taiwan issue, followed by the East China Sea disputes and the South China Sea disputes. On the Korean nuclear issue, Trump is likely to give up the Obama’s "strategic patience" policy and implement the "strategic repression" or even "effective strike" policy, because DPRKorea's nuclear weapons delivery technology progress constitutes a threat to the security of the U.S. homeland, which is unacceptable to the United States. To this end, he will strengthen military relations with Japan and South Korea, and promote the United States, Japan and South Korea to become the de facto trilateral alliance. Compared with the Taiwan issue, the impact of the South China Sea disputes in the next few years is likely to decline, so that the settlement of the South China Sea disputes shows a timely window. After all, both China and the United States have no intention of fighting in the South China Sea, and existing measures can also prevent the spiral escalation of accidental conflicts.

In Europe, Brexist's influence on the European Union is limited. If France is administered by a Trump-like politician, the European integration process might be reversed and the European Union becomes disintegrated. As long as the "Franco-German axis" is still in place, it can be concluded that the process of European integration will encounter some temporary difficulties and twists and turns.

that in order to understand the impact of the "Trump blast wave" on the international community today, we must first find out exactly what Trump is going to do and what it means to China.

First, from the perspectives of diplomacy and security, Trump believes that the United States spends too much energy and money in order to play the role of world police. As a result, he intends to shrink on security policy, such as giving up control of a series of "mess" in the Middle East. Although many people hate such a "World Police" of the United States, but it is not necessarily a good thing if there is no such a "big brother" to help maintain order and security. Especially in the context of China's high dependence on the Middle East oil, it would be difficult to conclude that it is an opportunity for China if the U.S. withdrawal further intensifies the turmoil in the Middle East,.

Second, the United States under the leadership of Trump is clearly requesting its allies to take more responsibilities, it can be said that at least in this year and a little longer period of time, the rift between America and its allies may increase, which may be a China’s opportunity -- if China can make appropriate use of it. For example, the New York Times recently comments that Trump was rude to Australian Prime Minister on the phone and that would push Australia to China.

Third, Trump now makes it clear that he will reduce or even withdraw support for global multilateral governance mechanisms, including even the United Nations, and he threatens to opt out of the WTO, and the United States will probably no longer be the leader and facilitator of the Doha round negotiations. The globalized trade meets with comprehensive difficulties, which can hardly be a China’s opportunity.

Fourth, Trump is clearly to engage in trade protectionism, to protect American industries, especially to take drastic measures to limit U.S. imports. So China is one of its targets. This is first of all a challenge for China, but may also be an opportunity. Because China can also use this external pressure as an opportunity to adjust its highly foreign trade-relied economic structure, foster domestic demand market, eliminate serious excess backward production capacity, and disperse excessive dependence on the U.S. market.

Fifth, Trump intends to see the return of manufacturing sectors, or to promote a development concept of a homegrown economy. The economic interests of the United States are global. For example, the United States has many economic interests in China and in Japan, but now Trump is more concerned about the economic interests within the United States. Therefore, Trump attempts to get American production lines and benefits abroad returned home. This is obviously more of a challenge for China, as competition between China and the United States in the manufacturing sector is likely to intensify. But in this regard, Trump is very difficult to achieve the goals set, because the general decline now of the manufacturing industry is its biggest problem, the United States does not have the industrial cluster and industrial chain to develop traditional manufacturing sectors. But if Trump does revive the U.S. manufacturing sectors, especially the high-end manufacturing sectors, which will put enormous pressure on China's manufacturing and industrial upgrading.

These are the five things Trump plans to do, whether it is an opportunity or a challenge to China will point to a result: the intensifying conflict between Trump and the U.S. constructivists. Now, Trump is fulfilling his promises and what he has done since he came to power was promised during the presidential campaign, which many experts fail to predict. Now a divided and chaotic America seems to develop, whether it is a chance or a challenge for China needs a comprehensive judgment .

Trump's series of policy choices have brought about a strong impact on today's international order. Joseph Nye argues that today's global economic order is highly similar to that of the 1930s. The strategic contraction of the United States highlights various contradictions. A series of crisis such as populism, religious conflicts, ethnic conflicts, anti-globalization etc. may be related. This above is worthy of academic attention.

In such a messy situation, how should China position itself?

China is still not a world leading country, is a participating country on the whole, the U.S. influence on the world's is still in dominant position. In this context, my judgment is that in the predictable future, China is still basically to adapt to the world trend. Whether to seek greater discourse or to create new international mechanisms in the existing system, it should focus work on increment, addition and improvement. China may overtake the United States in some areas, but is unlikely to replace its global role and position .

After 1949, China positions itself as an East Asian country for a long time, and the reform and opening up have rocketed the overall strength, and provided a ability basis for the Belt and Road strategy. The introduction of this strategy means that China has awaken that it is a major country at the eastern end of the Eurasian Continents. This geographical awareness has led to a shift of China’s entire diplomatic concept.

As a major country in East Asia of the Eurasian Continents, China needs to cooperate with the European Union at the west end of the Eurasian Continents to promote other regional development and build Eurasia into a true center of the world. For a long time, the Eurasian Continents have been locked in conflicts and disputes for religious, ethnic and social strata reasons. This gives the United States the opportunity to build the centre of world power by acting as an offshore balancer based on its own strength. The current situation has changed and for the first time since 1840, China has the ability and will to put forward and implement the Belt and Road strategy mainly for the Eurasian continents, developed Europe has launched the "Juncker Plan" mainly for small and medium enterprises, infrastructure adopted by the European Union; the two of which have the necessity and feasibility of docking.

I have repeatedly emphasized that it is possible for China to overtake the United States on some indicators, but it is impossible to replace its global role and position. The indicators of China's rise are not to challenge, replace, or overwhelm the United States, but play a constructive and guiding role in the world as a pole. The world leadership, to a certain extent, is a kind of cultural leadership, but there is neither universal leadership nor universal culture nor universal civilization, strictly speaking so far in the world. Even though Christian civilization and Islamic civilization get closer to it, yet the compatibility and openness of the Islamic civilization is insufficient, and its attraction of other civilizations is limited, so it can hardly produce world leadership. Only the Christian civilization in the United States is likely to produce a world leadership, and its openness and appeal to a variety of civilization quintessence are a very important reasons. The Chinese civilization belongs to regional civilization, and its cultural influence is limited to neighboring countries, so we should consider how to promote China's civilization and culture by developing its comparative advantages.

First, today's China must soberly and unequivocally recognize that it is a major country with a great global influence. Now, the Chinese every word and deed receive global concerns, including President Xi Jinping's speech overseas. Thus, China must be aware that its domestic and foreign policy are greatly concerned by and sensitive to the outside world, especially so in today's uncertain world.

Second, meanwhile, it should also clearly realize that although the Western world, especially Europe, has many voices in favor of China, the Western fears and suspicions mentality about China is still the mainstream. The West does not wish to see China dominate the world, because the West feels China is still "different". Even if the West eventually accepts China and accepts its current development model and civilization, it will be a long process.

Third, China should also have a clear understanding of its problems facing its self. At present, the West, Europe and the United States are meeting with many problems and a "chaotic" situation. But they have not found effective ways to deal with those problems, such as how to solve the dilemma of democracy, how to solve the problem of integration of immigrants, how to achieve fair and sustainable development, and how to ensure social stability. Mainstream politicians have not identified a promising prospect, so populism and nationalist voices are beginning to emerge as an alternative to the public. Now, Trump stresses the U.S. priority, because Americans generally have this demand, and it is from their perspective that it is reasonable. Europe also stresses the need to manage its own affairs well and they also recognize that they have accumulated too many problems, emphasizing the importance of sound internal governance. China, as a major developing country and emerging economy, cannot turn a blind eye to its own problems. Taking advantage of this good opportunity, China should re-examine itself, whether their current problems also exist in China in some different forms; it must not ignore the existence of these problems simply because they are not exposed yet.

What are the opportunities and challenges facing China?

and now China has become a regional major country with world-wide influence. The Belt and Road Initiative is the Chinese framework to promote this process, and this framework covers security, economics, financing, culture and other different fields. The focus of the Belt and Road strategy itself is on the Eurasian continents, a major reason is now China has advantages in manufacturing. After more than 30 years of development, China now has the ability and funds to develop its surrounding regions.

What opportunities does the present situation in Asia-Pacific provide for China to realize its goals? From the security perspective, China has limited opportunities. The U.S.-led alliance system will play the most important role in the Asia- Pacific region for a long time to come. At present, China can carry out mini-multilateral cooperation in some functional areas locally, for example to engage in joint military drills with some ASEAN countries.

Politically, China is still in a difficult position in the construction of its Asian mechanisms. China's economic clout has grown over the past few years, but suspicions and fears about China have also grown. In this case, China is unlikely to build a China-based Asian political system.

Economically, there are more opportunities, the Regional Comprehensive Economic Partnership Agreement (RCEP) and the Asia-Pacific Free Trade Area (FTAAP) may be China's main starting point in the field of trade. From the financial perspective, the AIIB will expand, whose influence may go beyond the Asian Development Bank.

Since the peripheral diplomacy is the focus, it is necessary to sort out the neighboring countries. For example, according to geographical adjacency with China, the surrounding areas could be divided into several peripheral regions, so as to determine fulcrum countries, key countries, and other countries and so on to work for common prosperity in those regions. In order to mobilize all positive energy, detailed planning is needed.

Generally speaking, China now has more advantages in the economic field, we must continue to firmly support globalization and free trade, which will also help to set up a "moral high ground" for China.

, China can play a greater leadership role in local areas, but not comprehensively. In order to identify specific areas, we should start with analyzing China's comparative advantages in the world.

First, in the area of free trade. China continues to unequivocally support free trade because of China's comparative advantages. Most economists are opposed to trade protection, and there are also many voices inside the United States against Trump's trade protectionism, so China's support for free trade is itself a public diplomacy without cost. China's national conditions also require its support for free trade, and it's biggest advantage is its human resources, which is able to play an advantageous role in an open economic environment. Over the past 30 years since the reform and opening up, China has made great progress in its development and construction, precisely because its human resources advantages are fully brought into play. China is also a country with relatively scarce natural resources so its development needs access to resources all over the world, which also requires an open environment.

Second, in the area of infrastructure construction. For the past 30 odd years, China has progressed outstandingly in infrastructure construction. Before acquiring the discourse in the international politics, China can strive to acquire the discourse in technology starting with technical standards in the process of export infrastructure.

Third, in the area of clean energy. Now, Trump-led United States in the areas of energy and climate change intends to revive traditional fossil fuels and reduce the support for clean energy. While China must not follow suit, but firmly move forward in clean energy, and lead the global clean energy revolution. Because China is facing much more severe environmental pressure than that of the United States, this pressure constitutes also a driving force for China's revolutionary achievements in this field. Trump's effort to return to fossil fuels is a reversal of historical trend. China should see the trend of historical development and do what will prove to be correct in the future. What is a major country, its vision should be further than an average country.

From the perspective of opportunities, there are several:

First, the resistance to China's foreign cooperation as a whole will probably become smaller. China's policies toward its neighbors, China's cooperation with the European Union and other countries have new space and momentum in the new situation. The resistance to China’s cooperation with all countries except the United States is generally on the decrease, since the United States has had too much interference with the world before. Moreover, many countries are worried that the next U.S. move may harm their interests. For example, Mexico is now very anxious, if the North American Free Trade Agreement (NAFTA) is destroyed, and must find another way out, but it is also true with European countries and some countries in the Asia-Pacific region. The Belt and Road construction will certainly produce some new opportunities, because in this world of increased uncertainty, the Belt and Road Initiative is a tangible project, can bring tangible benefits to the world.

Second, the current global chaos can stimulate economic and social transformation of China to raise the Chinese economic growth quality, and sustainability to a higher level, and become less affected by external constraints, which is an important aspect for a China to turn a risk into an opportunity, and is also the fundamental guarantee for China to upgrade its comprehensive national strength and global influence.

Third, the current chaos is helpful to shape a new international order. Because formerly the United States acts actually as a "leader", but now it is giving up responsibilities, violating U.S.-made rules. In this regard, China should work with other countries to improve global governance.

Fourth, command the opportunity of the strategic shift of the United States and reposition the Sino-U.S. relations. The confrontation between China and the United States is now prominent, but it does not mean that there is no opportunity at all. Trump wants the United States to be Great Again but he will get nowhere if he just holds onto protectionism and must have international partners. Thus, China and the United States may also form a new-type and mutually beneficial relationship in this process.

There are also four challenges: First, the uncertainty is brought about by Trump's coming to power, and the possible conflicts and confrontations between China and the United states. Second, China's opening-up to the outside world may meet with more resistance. China's exports may be under more pressure, and some China's investments, especially in Europe and America, may encounter greater resistance to mergers and acquisitions, especially in the high-tech sector. Third, regarding regional security issues, because some of Trump's policies may lead to major changes of the security situation in the Asia- Pacific region, especially in Northeast Asia. Fourth, regarding terrorism and the middle east situation. The Middle East policy reflected in Trump's campaign speech is relatively radical. Since the Middle East has been in a mess, and Trump may even worsen the Middle East chaos, which is likely to make the global anti-terrorism situation more severe and threaten China's security.

The "Thucydides trap" and "Kindleberger trap" are the two major traps facing global order. Regarding the specific China's diplomacy, there are "William II trap" and "Wilson trap", and if these two major traps can be bridged over, China is likely to have a great opportunity to achieve its set external strategic objectives.

First, the William II trap shaped in the history of the rise and fall of the German second empire. From this perspective, I always maintain that China's strategy should still focus on the surrounding areas. The key areas of the Belt and Road should be limited to the greater East and Central Asian regions, should be cautious in the Middle East, South Asia and other regions. East Asia, Southeast Asia should be the main direction, and then followed by Central Asia, Pakistan, etc., Africa, Latin America, Europe should be in secondary position, taking a step by step approach, haste makes waste.

Second, the "Wilson trap". History shows that the then U.S. president Wilson intended to promote the United States to play a leading role in the post-WWI, but in failure, although later President F. D. Roosevelt put most of the principles proposed by President Wilson into operation in the post-WWII. Nowadays, there are some domestic voices suggesting that China should take cautious considerations and measures in playing a more important role in the international community, especially in foreign aid since China still has a lot of problems to be resolved, for instance there are still scores of millions of poverty population and uneven rural-urban development.

In this case, I think that, geographically, China should continue to maintain East Asia and Southeast Asia as the strategic core regions, and first try to play a leading role in these regions, leading the economic integration of East Asia with trade, investment and currency. In the face of the "Trump shock blast", currently, almost all the major economies are facing severe tests, so the winners now depend on who can recover first from this mess in the international competition. Trump can only be in power for eight years to be the most, and this is only a moment in history, Trump may cause damages to the United States, but such damages can also be a "innovative destruction" or "destructive innovation."

According to a theory proposed by Olsen, an American economist, for a country to continue to grow, it needs a leading force at regular intervals to have the existing interests readjusted and reconfigured. He believes that after World War II, why did the United Kingdom and the United States meet with economic slow down? Because their long-term interests groups became cemented. If Trump really acts like the U.S. progressive movement in the past, screening all the establishment power groups, engaging in a "destructive innovation", he may really make America Great Again.

How could China seize the present "opportunities"?

First, continue to promote cooperation and promote win-win outcome. Under the current circumstances, that China emphasizes cooperation and win-win outcome naturally can have some new cooperation spaces. For example, the current China-EU cooperation has a big room for improvement, because the current turmoil is likely to bring stronger shocks to Europe than to China. Previously Europe was very dependent on the United States, but now has suddenly found that its surrounding issues - including Russia, the Middle East, refugees and so on, which have to be solved by itself. With Trump presidency in the United States, what is the future likely to be? Many Europeans are worried. There is an American president who publicly supports disintegration of the European Union on the other side of the Atlantic, and is so unfriendly to Europe openly, which was unthinkable in the past. In this context, the Europeans have more expectations for further development of cooperation with China. Although Europe has been greatly impacted, yet it still has the strength, and played a fairly big role in China's development and reform before. Thus, currently, there is still a big room for improvement in China-EU cooperation.

Before, China-Europe cooperation was basically confined to economic and trade relations, and there is still much room for expansion between China and Europe cooperation in the areas of defense equipment, technology trade and the protection of overseas interests in Asia, Africa and Latin America. The global governance also shows the urgency and necessity to strengthen China-EU cooperation, such as environmental protection, climate change, global development, refugee issues, anti-terrorism, cyber network, space, etc.

Second, regarding the policy towards the United States, China can strengthen coordination with the sides concerned, for example, strengthening coordination with Europe can be a good breakthrough. China and Europe should strengthen exchanges and dialogue together to persuade the United States to refrain from overdoing things, and at least to assume its due international responsibilities. In addition to the issue of trade protection, Europe and China have similar positions on many issues, such as climate change, the construction of international mechanisms, the maintenance of international rules, and the Iranian nuclear agreement.

Third, China needs to maintain its strategic concentration, sober-mindedness, and should not be influenced by the outside voices. China can play its own unique role, but to avoid the idea of "leading the world", because it is China that has always advocated that all countries, regardless of size, should treat each other equally and form a fair and just international order through cooperation.

Fourth, China should run its domestic undertakings well, which is the most important and fundamental. It will take a long historical process for the western world to accept China’s development mode.

China should always support free trade, and now FTA has become a good starting point for China's foreign trade. First, push China-Japan-ROK FTA to make substantial progress. Economically, get Japan back to the trilateral FTA in the context that TPP is meeting life-death dilemma. Second, accelerate the negotiations on FTA with the Cross Strait Foundation. Third, overcome the existing huge obstacles to promote FTA with Central Asia. Fourth, Mongolia is China's neighbor, but China has not negotiated the FTA with it.

China should pay more attention to East Asia and Southeast Asia when weighing strategic investments in different regions. Geographically, the Indochina Peninsula borders with China. If we can promote the infrastructure construction there and link up the southern part of China with relatively good economic foundation, which can greatly enhance China's economic radiation effect on the region. The Indochina Peninsula should be a focus of the Belt and Road Initiative.

However, it is still necessary to guard against and prevent excessive investments expansion overseas. For example, in Latin America and Africa, the Belt and Road Initiative should identify a few key countries or key areas to start with, then push further the cooperation based on the experiences and lessons.

As a big country, China has a certain responsibility to promote the development of its surrounding areas, and to promote the peripheral development is also necessary for further growth of China itself. China has dozens of neighboring countries, and Central Asian countries, Russia and Pakistan are undoubtedly the key countries and regions for cooperation, but ASEAN is likely to rank first in terms of economic potential. East Asia should become secondary.

China firmly believes in peaceful rise and is therefore committed to peaceful rise. This is obviously different from the "rising countries" in history". Historically, China does not have the ambition of territorial expansion. In the past few decades, China has taken care of neighboring countries in the process of settling territorial disputes. This is the conclusion of a book written by Dr. Taylor Fravel of Massachusetts Institute of Technology. But, why are the neighboring countries getting less interested in China over the past few years? Because many local people don’t feel the benefits of too few "popular projects". Through some specific cases, assure the surrounding countries awareness that China can be a trusted "good brother", this is the link in the rising process China must experience. Many people's opinions are in favor of "establishing prestige by tough means". But I believes that, with competitors, the effect of this approach is no good, neither should be used often.