On Thursday 29 August, the Perth USAsia Centre hosted Richard McGregor, Senior Fellow at the Lowy Institute, for a public lecture and In Conversation discussion at the University of Western Australia. The event occasioned the Perth launch of Richard’s recent Lowy Institute Paper, Xi Jinping: The Backlash
In recent years, the relationship between Australia and the People’s Republic of China (PRC) has become increasingly contested. Issues as diverse as trade disputes, the detention of Australian nationals, the Hong Kong protests, foreign interference concerns and Pacific Islands diplomacy have emerged as challenges for the bilateral relationship. Indeed, these Australia-PRC tensions come at a time when China’s relationships with many western countries – especially, but not exclusively, the United States – have become more strained.
Many of these diplomatic tensions coincide the rise of Xi Jinping to position of paramount leader and President of the PRC. Xi should be considered a revolutionary leader in the context of modern Chinese history, due to the way which his leadership has transformed many longstanding traditions and institutions of the PRC’s political system. At the time of his ascendance to top leadership, few analysts within or beyond China would have expected Xi to make so fast and profound a change to political rule. These transformations include:
- The “tigers and flies” anti-corruption campaign, an early move during his tenure to address systemic abuses of power and provide greater stability within the Chinese Communist Party (CCP).
- A new direction for economic reform, with reduce emphasis on market-oriented change in favour of greater support for ‘national champion’ state-owned enterprises in the technology and advanced manufacturing sectors.
- The launch of the Belt and Road Initiative (BRI), a landmark diplomacy program based on infrastructure and connectivity which for the first time seeks to transnationalise the PRC’s economic system beyond China’s borders.
- A period of political closure in civil society, with reduce space for journalists and civil society to publicly critique the CCP or policy directions it initiates
- Transformative constitutional reform, which abandoned the leadership transition processes established under Deng Xiaoping to remove term limits and embed “Xi Jinping thought” in the political system.
McGregor argues that while these reforms have significantly consolidated power within the hands of Xi and his close allies, they have also sowed many internal challenges within the CCP political system. These include elite divisions catalysed by the removal of powerful officials during the anti-corruption campaign; slowing growth as the pace of economic reform has moderated; and ongoing demographic challenges associated with the PRC’s ageing population and gender asymmetries resulting from the (recently reformed) One Child policy.
These internal challenges have come at a time when external difficulties arising in the PRC’s foreign relations. As foreign policy has shifted toward a more activist, and at time confrontational, footing under Xi, many external conflicts have increased in intensity.
- Anti-PRC protests in Hong Kong are the most prominent example, and pose a potential threat to the political integrity of the PRC and the authority of the CCP. If the situation were to escalate further and the PRC responded with force, there would be a profound deterioration of relations with major diplomatic partners.
- The ongoing trade war with the US simultaneously threatens the PRC’s already slowing growth. Several attempts to broker a deal with President Trump have foundered as Chinese negotiators have proven unwilling to concede to US demands surrounding support for state-owned enterprises and intellectual property rights.
- There has been pushback internationally against the presence of Chinese technology firms (including but not limited to Huawei), over concerns of espionage and foreign interference. These disputes undermine the PRC’s capacity to internationalise the economy’s technology ecosystem and drive a new round of tech- rather than-heavy industry driven growth.
McGregor argues that it remains to be seen how this combination of internal and external challenges associated with Xi’s leadership will play out. On the domestic front, a key indicator will occur in 2022, when the original term limit for Xi’s presidency is reached. How a leadership transition will be facilitated in the absence of an organised ‘generation change’ mechanism will be important in setting the tone for longer-term dynamics in the PRC political system. On the international front, it appears the US-China rift has now become a permanent feature of not only their bilateral relations, but also the international order at large. How the PRC responds to increasing pressure from the US – across the trade, technology, security and diplomatic domains at once – will determine the style we should expect from it as an international power.