Figuring Out China’s Next Move
WHY YOU SHOULD CARE
Because the world's biggest country is also the world's biggest mega-story.
By Pallabi Munsi
There was never going to be a thaw when top American and Chinese diplomats met in Anchorage earlier this month for the first time since President Joe Biden took office. But the winds blew even colder than expected, and it’s unclear how Biden will approach ties with Beijing. What’s indisputable? No matter what happens between Washington and Beijing, China’s importance is only going to grow — for America, the world and for you. Today’s Daily Dose takes you into the fascinating, fast-changing world of Chinese politics, business, culture and foreign relations. It’s a world you could once afford to ignore. Not anymore.
Sun Chunlan. When Communist China’s founding leader, Mao Zedong, famously declared that “women hold up half the sky,” he might not have imagined that 66 years later the country’s top boardroom — the Chinese Communist Party’s 25-member Politburo — would feature just one woman: 70-year-old Vice Premier Sun. But this former clock factory worker got her timing just right. Sun is President Xi Jinping’s coronavirus czar, and her success in rapidly bringing the crisis under control has turned her into a household name, raising her political stature as China leads the world out of the pandemic-spawned recession — even though the virus originated there and an early attempted cover-up hampered progress. Now she’s on a mission to speed up free COVID-19 vaccinations so China can win that race too.
Liu He. He’s the man Xi trusts to keep China’s economy steady. From trade talks with the U.S. to improving GDP numbers, the 69-year-old Harvard-educated economist is Xi’s point person, a quiet puppeteer charting the future path of the world’s second-largest economy. Now “Uncle He” is leading a war against China’s credit boom — and fintech giants like billionaire Jack Ma’s Ant Group are in his crosshairs. The scope of his campaign will tell us just how much Xi wants to control the Chinese private sector that has unleashed the country’s economic potential over the past 40 years.
Han Zheng. What Liu is to China’s economy, Han is to Xi’s plans to firmly bring Hong Kong to heel. Han was just 48 when he became mayor of Shanghai in 2003 — the youngest person in half a century to hold one of China’s most coveted political posts. Now in charge of Hong Kong and Macao for the CCP, he has the difficult task of convincing Hongkongers that Beijing wants to support the city’s development, while cracking down on all signs of democratic dissent. He’s the face of China’s latest controversial step to only allow only “patriots” to run for elections in Hong Kong. If China breaks with the One Country, Two Systems model it promised Hong Kong when it regained control of the island in 1997, you’ll know it was Han who rocked the cradle.
Cai Xia. If Sun, Liu and Han represent the satellites in Xi’s narrow orbit of trust, Cai is the opposite. A teacher at the Central Party School, Cai was a CPC insider, the daughter of revolutionaries who sacrificed much to set up Communist China. But she was expelled from the party last year after she called Xi a “mafia boss.” Now in exile abroad, Cai has emerged as one of the Chinese president’s most potent critics. Her background and decades of loyalty to the party make it hard for Beijing to paint her as a Western stooge. As for Cai, she believes Xi has abused the ideals of Communist China her parents fought for. Pushing back is her ode to them.
In the Driver’s Seat. For years, China depended on reverse-engineering foreign automobile brands for transportation upgrades. No longer just a copycat, Beijing is buying up innovative Western auto startups and hiring global talent to develop some of the sector’s cutting-edge technology, from 3D-printed vehicles to flying cars. This strategic shift is a central part of the Chinese government’s pivot to hi-tech innovation over low-cost exports and is making Beijing a global automotive giant. Next up: Zeekr, a new brand of premium electric vehicles launched by Chinese company Geely Automobile Holdings, plans to deliver its first vehicles in the third quarter of 2021. Elon Musk, watch your rearview mirror. Read more on OZY.
The Next TikTok. TikTok and Amazon rolled into one, Kuaishou allows the sophisticated and fun social media experience of the former while enabling on-the-spot e-commerce to rival the latter’s abilities. And you can tip creatives on the platform. Amid the pandemic in August, it was registering 500 million monthly e-commerce orders. Instagram Reels, Facebook’s TikTok rival, is trying to mimic its model. Kuaishou’s stock soared 194 percent after it went public last month, hitting a market capitalization of $160 billion. But it’ll need to survive Uncle He’s crackdown on Chinese Big Tech if it’s to have more than 15 seconds of fame.
5G Glee. When then U.S. Attorney General William Barr warned last year that “our economic future is at stake,” he wasn’t exaggerating about China’s 5G dominance. Giants Huawei and ZTE account for 40 percent of the global telecom network market, a tribute to China’s rapidly expanding investments in 5G, which promise faster network speeds and innovations from health care to transportation. And while Western bans and U.S. restrictions on the sale of smartphone chips to Huawei have meant the company saw its revenues drop outside China last year, look no further than Yinchuan, a windswept city on the outskirts of the Ordos Desert, for the future of 5G. With automated garbage collection, smart traffic management and much more, it offers a template for what our cities could look like in a few years. Read more on OZY.
Small Is Big. From cloning to cancer research, China is using nanoscience to drive some of the world’s biggest breakthroughs. In 2018, Chinese researchers were responsible for 40 percent of all nanoscience research papers — the U.S. was second with 15 percent. Or to put it differently, there’s nothing nano about China’s ambitions in nanoscience. Read more on OZY.
new cultural revolution
Slow Living. If Mao’s disastrous Cultural Revolution of the 1960s and 1970s was about social upheaval, life in China over the past three decades has been defined by rapid urbanization, soaring dreams and the constant search for wealth. Now a new generation is tiring of that approach, especially after a pandemic that has exposed its pitfalls, Instead, more than 100 cities and counties are embracing “slow living,” setting population limits, throttling down traffic and restricting fast food. Read more on OZY.
The Luxury-Gaming Marriage. From Gucci to Burberry, the world’s top luxury brands are embracing China as their test market. How a fashion line does there will determine what you find in your stores. And the reasons for the shift go beyond China’s market size. Apps like WeChat — and now Kuaishou — that marry social media with e-commerce make targeted advertisements easier in China than in the West. Chinese millennials are the ones with large disposable incomes, unlike the West and Japan, where only older people can afford to spend on high-end fashion. That makes China a perfect litmus test for the future. It’s also why luxury brands in China are turning to an unlikely set of brand ambassadors: young gamers. Read more on OZY.
Cultural Imperialism. From the hanbok to kimchi, China faces growing accusations of trying to appropriate symbols of Korean culture. Recently, Chinese search engine Baidu irked South Koreans by introducing Yun Dong-ju, a Korean poet and independence activist during the Japanese colonial era, as “Chinese.” Is it a coincidence that this appropriation comes at a time when K-pop and Korean dramas are ruling global airwaves, pushing China’s soft power influence into the background? Koreans don’t think so. In 2020, a Pew survey found that 75 percent of the South Korean public held unfavorable views of China.
Now Showing in Africa. But appropriating what belongs to others is hardly China’s only soft power strategy. Since 2015, Beijing has funded a massive project to supply digital television services to rural Africa, so don’t be surprised if you find Kenyans watching kung fu films. China is also investing in African films and TV shows to expand its cultural footprint on a continent where it is already king. And it seems to be working. In the East African nation of Malawi, Chinese movies are ubiquitous in movie halls, home television sets and on the internet. Chinese films are even being dubbed into the local Chichewa language.
everybody’s friend, nobody’s friend
‘Marriage Made in Heaven.’ That’s how Israeli Prime Minister Benjamin Netanyahu has described his country’s relationship with China. As the U.S. pressures Saudi Arabia on its human rights record, the Gulf power too is drifting toward China — they signed a mammoth $28 billion investment deal in 2019. And ignoring U.S. sanctions, China is buying record volumes of oil from Iran, keeping that country’s broken economy afloat. So why are countries that can’t agree on anything else — Saudi Arabia, Israel and Iran — all in love with China? Unlike Washington, Beijing hasn’t yet embroiled itself in the region’s rivalries. Unlike Europe and Russia, it doesn’t have an imperial history in the Middle East. And unlike all the others, China has cash to splash.
Jittery Neighbors. It’s a very different story in China’s own neighborhood. In 2013 when Xi first unveiled the Belt and Road Initiative — a web of highways, railroads and ports connecting different parts of Asia with each other and with Europe and Africa — he had everyone’s attention. But amid growing concerns over rising debts from Chinese investments under the BRI, an increasing number of Asian nations are reevaluating their partnerships under the project. China’s growing military assertiveness in the Himalayas and South China Sea aren’t helping in a part of the world where — unlike the Middle East — China does have a long history of war and invasions. Over the weekend, the Philippines said it was sending fighter aircraft over some 200 Chinese ships that Manila claims are encroaching on its territory in the South China Sea. Read more on OZY.
Vaccine Diplomacy. In a world where COVID-19 vaccines will likely determine who can travel and which economies can safely open up, China realized early that jabs will hold greater soft power than Hollywood for the foreseeable future. They’re also a smart way to make money. So it raced to develop vaccines that it has since exported to countries across Africa, the Middle East, South America and parts of Asia. It cut corners, introducing vaccines for use before final clinical trials were done. Yet while that has led to some distrust, the vaccine nationalism infecting U.S. and European policy means poorer nations often have nowhere else to turn but Beijing. Read more on OZY.
Africa’s Alternative. Yet China’s not getting a free run everywhere. In Africa, where China is the biggest investor, it’s now facing a challenge from an old rival: Japan. Since 2017, three major Japanese venture capital firms have invested tens of millions of dollars in African startups. Japanese money is allowing a continent swamped with Chinese cash to look for alternatives. For the Japanese firms, pumping cash into politically volatile economies is a chance to break with their image as risk-averse, safe investors. The real winners? African startups. Read more on OZY.
When Love and Hate Collide. On the surface, it looks like a bitter breakup. The European Union and China imposed tit-for-tat sanctions on each other’s officials last week over Brussels’ concerns about human rights in Xinjiang. But remember, the human rights excesses in that Chinese province were known just as well when the EU and Beijing struck a landmark investment deal to ring in the new year three months ago. And away from the public rancor, China is a major financier of key infrastructure projects in Scandinavia and the Baltics. So, while things look rough right now, don’t bet against a handshake some months from now. Just like professional poker players do after a particularly well-orchestrated bluff. Read more on OZY.
- Pallabi Munsi, OZY Author Contact Pallabi Munsi