Part 1 – Digital Payments System in China – A Catalyst for Development of Digital Yuan 

Part 1 – Digital Payments System in China – A Catalyst for Development of Digital Yuan 

Part 1 – Digital Payments System in China – A Catalyst for Development of Digital Yuan 

By — Omkar Bhole;

This is the first in a new series on Digital Yuan.

In the past one decade, China has been rapidly transforming into a cashless economy Owing to China’s growing domestic consumption, digital payment systems like mobile payments and card transactions have made payment settlements more convenient for Chinese citizens. Moreover, the COVID-19 pandemic extensively stimulated digital payments, driven by social distancing policies adopted by governments across the world over the last two years.

China’s Provinces Dashboard

Prepared by — Rahul Karan Reddy
 
How well do you know China’s provinces? The China’s Provinces dashboard is a resource for exploring differences in economic and social development across provinces in China. The resource visualises 76 statistical indicators of development, grouped into six categories: demographics, economic growth, income/consumption, trade, healthcare and environment. The indicators presented in this resource can be viewed for each province and sub-region of China. The data presented is for the year 2021 and was collected from the 2021 Statistical Yearbook published by the National Bureau of Statistics (NBS).

Navigation:

* Best suited for desktop viewing.
* Clear the filters by selecting the funnel icon on the right top corner of the filter to refresh the contents of the dashboard.

Categories:

The main tab at the top of the dashboard (Demographics, Regional Economy, Income & Consumption, Trade, Municipal and Environment) permit users to navigate across categories.

Filters:

The Region filter below the main tab permits users to view indicators for sub-regions across China (Central, East, North, North-East, South and West). Selecting a sub-region will prompt the dashboard to show data for provinces in that sub-region.

The Province filter on the right hand side of the dashboard can be selected to view indicators for individual provinces. Selecting a province will prompt the dashboard to show data relevant only to the selected province.

* Remember to clear the filters (funnel icon on the right top corner of the filters) to refresh the dashboard after using a particular filter.
* When no filters are selected, the dashboard shows the national average of indicators.

<strong>Xi’s Loyalists: A Breakdown of China’s New Leadership</strong>

Xi’s Loyalists: A Breakdown of China’s New Leadership

Xi’s Loyalists: A Breakdown of China’s New Leadership

By Rahul Karan Reddy and Omkar Bhole;

The Communist Party of China (CPC) unveiled its new Politburo Standing Committee (PSC) and Politburo (PB) on October 23rd, ushering in a highly anticipated and consequential leadership transition at the highest levels. Although it came as no surprise that Xi Jinping was reappointed as the General Secretary of the CPC, new appointments to the PSC and PB have confirmed his dominance in China’s elite politics.

China’s ‘New Era’ through the lens of 20th Party Congress Work Report

China’s ‘New Era’ through the lens of 20th Party Congress Work Report

China’s ‘New Era’ through the lens of 20th Party Congress Work Report

By — Rahul Karan Reddy and Omkar Bhole;

            Xi Jinping’s opening speech at the 20th Party Congress highlighted key achievements and challenges during the tenure of the 19th Party Congress. In combination with the detailed work report, Xi also revealed key drivers of China’s behaviour for the next few years. His speech at the 20th Party Congress has struck a different tone from the one he delivered at the 19th Party Congress.

The Return of Technocracy in CPC’s Elite Politics

The Return of Technocracy in CPC’s Elite Politics

The Return of Technocracy in CPC’s Elite Politics

By — Rahul Karan Reddy;

Technocrats are set to re-emerge as a defining feature of China’s top leadership in Xi Jinping’s third term. As per the (re)emerging trend of  “red and expert” (you hong you zhuan) from the Mao era, Party members with an education in STEM fields or social sciences, work experience in the private sector or State-owned enterprises (SOEs), sufficient provincial or national-level administrative experience, and a record of loyalty to the Party ‘core’ stand a stronger chance of making it to the 20th Central Committee (CC).

Implications of the 20th Party Congress: Economics, Politics and Foreign Policy

Implications of the 20th Party Congress: Economics, Politics and Foreign Policy

*See our predictions and read our special report for the 20th Party Congress here*

By Rahul Karan Reddy and Eerishika Pankaj;

As the historic 20th Party Congress draws closer, it is important to assess how the ‘Prince’ and all his men will tackle internal and external policy challenges awaiting the Communist Party of China (CPC). For instance, the 19th Party Congress in its last three years had to deal with worsening of China’s ties with the US (plus the larger West) and India, while the COVID-19 pandemic emerged as a critical challenge. The results of the upcoming Party Congress, particularly the make-up of important leadership bodies, will determine how much influence and control Xi Jinping will have over the political, economic, and foreign policy course that China will take over the next five years and beyond.

1. A Changing Foreign Affairs Ministry

Foreign policy is unlikely to see a drastic change due to personnel changes- unless of course Xi emerges as a weaker leader, the chances of which remain slim. Instead, it is important to see foreign policy more in continuation of the trend it has followed until now, with certain adjustments in the foreign economic policy as per requirements of the national economy. Due to the hierarchical structure of the party, the Standing Committee remains the major body deciding the course of foreign policy, with the Foreign Ministry serving more as an implementor of state decisions.

As implementor of state decisions China’s Foreign Ministry leadership changes will hold direct implications for the world. China is experiencing a generational gap and a shortage of seasoned diplomats as the nation deals with what many analysts describe as possibly the most hostile external climate in decades, despite the growth of a group of younger diplomats considered to be the post-Cultural Revolution generation. Hence, top diplomats’ reorganisation should be seen and understood in the context of overall leadership transition plans.

Yang Jiechi, China’s top diplomat and Director of the Office of the Central Commission for Foreign Affairs, is scheduled to leave the Politburo at age 72 after nearly ten years in that position. At the same time, Wang Yi, who is the Foreign Minister and also a state councillor, will also be retiring. Yet, in spite of the fact that Wang will turn 69 in October, Chinese diplomats and other observers feel that an exemption to the standard retirement rules will likely be granted for him. Wang might fill Yang’s position on the 25-member Politburo by staying on, moving up a level, and using his ties to help the Chinese leadership navigate a developing diplomatic crisis.

Should Wang take over from Yang Jiechi post an extension, Chinese foreign policy will likely continue to follow the ‘wolf-warrior’ format of diplomacy it has imbibed since 2017. This can be gathered from Wang’s comments in July defending the rise of such diplomats, especially as China’s ties with the US grow more and more sour. Wang’s walk-out from ASEAN events also attended by US and Japanese diplomats in August 2022 as a response to Nancy Pelosi’s Taiwan visit further highlight his continued faith in a more hawkish diplomatic approach.

Yang and Wang’s departures at the same time will leave a void in China’s foreign service, which will jeopardise the consistency of China’s foreign policy. For instance, Wang remains best suited at present to handle the diplomatic channel with the US as the military and climate channels have been discontinued, leaving just the diplomatic thread to maintain relations. Importantly, even as Yang has started reducing public appearances, Wang has remained actively engaged with focus on biaotai (loyalty signalling)remaining strong. Nonetheless, should the age-limit remain a key variable, other contenders for Yang’s position emerge in the form of Song Tao and Liu Jieyi, each of which will bring about a subtle shift in foreign affairs outlook:

  1. Song Tao, who has long been seen as a protégé to Xi; was unexpectedly transferred to a less important role at the Chinese People’s Political Consultative Conference, the nation’s highest political advisory body, may indicate his semi-retirement. Nonetheless, should Song re-enter the running, then based on his previous experiences during 2001-2008 as Councillor to India and Ambassador to Guyana and Philippines, focus on more traditional approaches to building diplomacy can see potential for return. Post 2008, Song has served important roles within the Foreign Ministry, but no international deputation portfolios. This puts him at a disadvantage compared to fellow competitors, especially as his latest transfer can only be viewed as a demotion.
  2. Liu Jieyi, 64, director of the State Council’s Taiwan Affairs Office (a position Wang held prior to being named foreign minister in 2013) and former ambassador to the United Nations is another potential candidate for Yang’s post. His lack of experience as a country-level deputation officer might adversely impact China’s bilateral diplomatic outreach especially if ‘wolf-warrior’ diplomacy is to see continuation. However, as Taiwan emerges as one of the most pressing diplomatic challenges, Liu’s command over Taiwan policy might provide a strong point in favour of his appointment.

Here, however, it is important to review the 2020 appointment of Xia Baolong, 69, as director of the Hong Kong and Macau Affairs Office. Xia, a long-term Xi ally who made a name for himself by being a hardliner against Christian churches, is not a member of the Central Committee and beyond the traditional age for appointment to important offices. However, as the position of the Hong Kong and Macao Office falls under the State Council, an exemption for him was made, owing most likely to his close personal relationship with Xi. Such a maneuver highlights that for a State office like the Foreign Ministry, there remains room for more flexible age-limit adjustments as per candidate preferences by Xi.

Beyond Yang’s position, the race to succeed Wang as foreign minister also has many key contenders like Le Yucheng, Ma Zhaoxu, Xie Feng, Liu Jianchao, Deng Hongbo, Liu Haixing and Qin Gang.

Ultimately, while the positional changes remain anyone’s guess, two key aspects of diplomatic policy indication at China’s 20th NPC emerge in the form of continuity and doubling-down on wolf-warrior diplomacy. There remain key challenges awaiting Chinese diplomats across the globe; for instance, despite disengagement along the India-China border, there remain areas of Depsang and Demchok –as well as potential threats like the triggering of the Dalai Lama’s succession process –that are yet to be dealt with. Meanwhile, ties between the US and China as well as China and Australia remain at an all-time low, and EU-China relations struggle to find momentum.  For Chinese foreign policy, there are four key challenges in 2022: 

  1. (Re)Building a trustworthy yet strong international image especially as hits in the form of COVID-19, Galwan, Ukraine and Taiwan have impacted global recognition; 
  2. Growing China’s participation in global and regional governance, especially as minilaterals led by democratic countries in the Indo-Pacific gain rapid traction; 
  3. Effectively managing the unstable China-U.S. relations while improving deteriorating ties with India, Japan, Australia and EU;
  4. Manoeuvring re-unification with Taiwan, with or without force, on an international stage

During such a time for Chinese foreign policy, a break away from a less-than-strong stand in communicating Beijing’s needs will not be the message Xi would wish to communicate as it would break away from his strongman position. As he would be securing an unprecedented third term in office, therein cementing domestic power within China, Xi’s focus would be on exporting such a model of authority in international politics as well to posit his –and China’s –continued rising power globally. Based on the precipice Beijing stands at vis-à-vis its international image and outreach, an extension of Wang Yi’s presence within the Foreign Ministry despite age limitations as successor to Yang Jiechi remains a possibility to ensure continuation of seasoned diplomacy that is well in line with China’s internal ambitions.

How Xi’s China will engage with international actors like US, India, Japan, Russia, Australia, UK, EU, South Korea, Indonesia and more as well as its manoeuvring vis-a-vis sensitive geopolitical arenas like the two China seas, the LAC and Taiwan are going to be shaped by the Foreign Ministry and Xi Jinping. Attempts at rebalancing ties with the US (especially along foreign trade policy lines) as well as focus on trade negotiations with the European Union (EU) are taking shape, while potential to improve relations with Australia can be achieved via economic and diplomatic outreach. Meanwhile, ties with Russia and North Korea have taken on stronger hues that require delicate projections internationally.

Hence, Xi would want to install players that he has trust in and believes would be able to act as strong extended arms of his own presence abroad, especially as the Chinese President has limited his international state-visits post the pandemic. The foreign ministry’s top echelon are vacancies wherein Xi would be more focused on appointing people with experience rather than bridging generational gaps by bringing in younger talent; a move many expect from the leader especially vis-à-vis Central Committee personnel changes.

2. Shaping Domestic Economics

Control over Economic Policy:

Xi Jinping is likely to exercise full control over long term economic policy, as Li Keqiang is side-lined and other reform-minded officials like Liu He and Guo Shuqing are retired. Xi and the Leading Group for Comprehensive Deepening of Reforms is likely to create long-term economic policy while state bodies like the National Development and Reform Commission (NDRC) will execute policies devised by Xi. Moreover, the potential successor to Li Keqiang, Hu Chunhua, who will be responsible for the economy at large is not an economist like Li and will only execute the policy directives of Xi Jinping. If Hu Chunhua is made Premier, he will most likely implement Xi’s left-of-center, state-driven economic policies without reluctance given his background as a Party bureaucrat and need to signal loyalty to Xi Jinping.

However, it appears that in the short-term, as long as China’s economic woes continue, Xi Jinping will be forced to cede control of economic policy making to Li Keqiang and other reform minded officials. The economic policies announced by Li Keqiang over the last two to three months are likely to remain in place for the next year or two. The task forces sent to 16 provincial-level regions by the State Council to supervise economic policy implementation shows that Li has been placed in charge of economic recovery. There are also signs that policy flexibility will be encouraged as Li Keqiang announced in late August that city-specific policies (one city, one policy) should be deployed to support housing demand. For instance, Zhengzhou became the first big city to end household registration (hukou) for non-locals to stabilize the real estate market. Nearly 120 cities have introduced policies that encourage housing demand, a sign that economic recovery is the immediate priority and policy flexibility is sanctioned.

Balancing Xi’s Economic Vision and Sustaining Growth:

Xi Jinping is likely to balance the need for reform and execute his economic vision of common prosperity. In the short term, Xi will be forced to hold back on his populist economic agenda of common prosperity until China’s economic woes are less pronounced, emphasising stability instead. ‘Making the cake bigger before redistributing it’ will take precedence as China’s economic woes in the real estate and banking sector are exacerbated by natural disasters and dampened consumption in the global economy. The focus will be to restore growth to at least 4% through a stimulus package for the third and fourth quarter of 2022, which was announced in August. Populist policies like common prosperity, directed at addressing wealth inequality and self-reliance, are likely to be emphasised less than the need for reviving consumption demand, investor confidence and ensuring price stability.

Given that GDP growth is an indicator of the administrations performance and delivering prosperity is a pillar of the CPC’s legitimacy in China, managing expectations about growth will be critical for Xi and the Party. Expectations of economic growth have already been toned down, with the Politburo even stating that growth should be kept within a ‘reasonable range’. Leaders in China’s export-oriented provinces will be under pressure to sustain growth and avoid single digit export growth as consumption dampens around the world. In a meeting with Li Keqiang, Party Secretaries and Governors of six key provinces were expected to take the lead in supporting the stabilization of the economy and even explore and deepen reform.

Additionally, with zero-COVID policies showing no signs of easing and nearly 50 cities under lockdowns, consumption is unlikely to drive growth in the short term. Lastly, youth unemployment rate of 19.9% in July is the highest since 2018 and could become a source of discontent in China. Such pressing challenges facing China’s economy are likely to ensure that economic management forces its way to the top of the list of priorities for Xi Jinping until China’s economy is on the road to recovery.

Persisting with Zero-COVID and Crackdowns on Commercial Centers of Power:

The zero-COVID policy is unlikely to disappear in the short term, even after the Party Congress, as evidenced by the current lockdowns in Chongqing and other provinces. However, the lockdowns were eased two weeks after they were announced, perhaps revealing the urgency of economic recovery. The emphasis on pandemic prevention as a prerequisite for economic growth continues in state media, but better coordination between pandemic prevention and economic policy is expected. Given the touted success of China’s pandemic prevention, the Party will continue to emphasise that zero-COVID was instrumental for China’s economic recovery immediately after the COVID-19 outbreak. However, as Xi Jinping loyalists are appointed to key positions, they will be eager to enforce the zero-COVID policy as a demonstration of political loyalty to Xi Jinping.

Xi is likely to persist with the imposition of regulations on economic sectors like tech, finance and real estate. Officials in the State Council and others will emphasise the importance of financial de-risking, which is one of Xi Jinping’s ‘three tough battles’. Controlling the disorderly expansion of capital will remain a priority for Xi as a way to assert control over officials and businesses operating in important financial and economic hubs in China.

CPC’s Political and Policy Changes

Personnel appointments at the Party Congress and trends within the Party suggest that Xi Jinping will continue consolidation of his control over various party organs. For instance, after the public security apparatus of China was brought under Xi’s control after purges of Zhou Yongkang’s network, appointment of loyalists will reflect Xi’s pervasive control over Party organs. Most importantly, with the purge of military officials and the appointment of 38 generals since 2019, Xi has brought the military, the most significant organ of the Party under his singular control. Control over the military rules out the possibility of any challenge to Xi from within the Party. Further, the CCDI and NSC will play a significant role in Xi’s third term as well, eliminating any opposition to Xi Jinping and targeting adversaries. Such moves will cleanse Party organs of influence networks operated by Xi’s rival factions while appearing like an operation to tackle corruption and excess. Moreover, the proliferation of Party organs like the CCDI into private companies, SOEs and other institutions will only sustain the control Xi exerts across Party organs.

However, Xi will find it relatively harder to identify and trust competent loyalists from younger generations, compared to those from his own generation that he shared close personal relationships with. Younger officials wouldn’t know Xi as well as Xi’s peers because they wouldn’t have worked with him directly. Moreover, they will be willing to feign loyalty for their political future, making it harder to ascertain their true intentions, ambitions and allegiances. Most importantly, grooming a successor will be a much harder task for Xi, given the risks a successor poses to Xi’s legacy and authority in the Party. Xi risks surrounding himself with ‘yes men’ reluctant to express contrary views on matters of economic or party policy, more concerned for their political position and driven by ambitions to climb the political ladder. The benefit of having a balance of reformers and ‘party-first’ personnel is no longer available to Xi once he stacks the highest bodies of the Party with loyalists.

Given the trend of Xi’s expanding control over the Party, it is likely that rival factions are side-lined even further and their role on the PSC and Politburos is diminished. It is expected that most new appointments to the PSC and Politburo will be personnel from the Xi Jinping faction and even those appointments from rival factions would have limited opportunities to cultivate networks of proteges. Moreover, political survival would dictate that personnel with ties to Jiang Zemin, Hu Jintao, the Communist Youth League and other factions would go out of their way to signal their allegiance to Xi. Additionally, Party elders like Jiang Zemin, Zhu Ronji and others are likely see their influence diminish further.

Xi will continue to enshrine his name and vision in the Party and state constitution, make his goal of rejuvenating the Chinese nation the singular objective and reiterate his centrality to achieving those goals. Xi Jinping’s legacy is likely to surpass that of Mao and Deng, and with the possibility of a fourth term it is possible that Xi will be considered modern China’s most important leader. Finally, Xi Jinping will most certainly amend the Party Constitution in October to shorten his ideological contribution, “Xi Jinping Thought on Socialism with Chinese Characteristics” to simply the “Xi Jinping Thought”, upgrading its importance to that of “Mao Zedong Thought” and jettisoning Deng’s phrase ‘socialism with Chinese characteristics’ from his own contribution. It is also expected that Xi will include his “Two Establishes” phrase in the document to cement his core position in the Party.

Structural importance of the Party Congress

China’s actions over the last five years have increasingly disassociated its identity with a non-threatening rise narrative; more and more actors are identifying Beijing as a revolutionary revisionist power. Such recognition has resulted in nations attempting economic decoupling from China, increasing focus on restructuring supply chains, limiting China’s access to technology as well as domestic tech markets of other countries, a greater number of minilaterals in the Indo-Pacific and focus on the ‘China Challenge’ by the Quad. Moreover, public reaction to the zero-COVID policy within China has seen divide emerge in the Party’s confidence in Xi’s leadership while China’s strategic gameplan vis-à-vis Ukraine has further alienated it from the West.

The results of the upcoming 20th Party Congress, particularly the make-up of important leadership bodies, will determine how much influence and control Xi Jinping will have over the political, economic, and foreign policy course that China will take over the next five years and beyond. As such, looking at the implications of the Congress becomes a critical assessment criterion to prepare how countries should expect to engage with a changing China.

China’s Foreign Policy In The Sahel: Challenges And Prospects

China’s Foreign Policy In The Sahel: Challenges And Prospects

By Dara Cheick;

According to Chinese political scientist Lanxin Xiang, there are three objectives of Chinese politics: the restoration of the past glory of China and the state; recalling the age-old desire for a rich and powerful modern China and maintaining social stability. Seen from Beijing’s point of view, Africa remains a political and economic question rather than a military and security issue, despite the mantra of “security and development”. However, the security dimension does exist and is even tending to increase, particularly because China is worried about the protection of its nationals in Africa, whose number is estimated today at one million people. In terms of resources (such as oil, zinc, iron, cobalt, copper, titanium, etc.) as well as from the commercial point of view, the development of the Chinese economy depends on Africa and therefore its stability is very crucial for China. The deployment of Chinese military forces in Africa responds to a growth in both security supply and demand.

The Sahel comprises a geographical area that covers five countries of West Africa including Mali, Niger, Mauritania, Burkina Faso and Chad, working as an organization at the sub-regional level called G5-Sahel, created on December 16, 2014, in Nouakchott. The region is largely covered by sand and is in the grip of a security crisis that threatens the lives of the people struggling with forced displacement, and massacres with a very heavy toll on human life. This instability has also affected the industrial infrastructure of the region which has reached the brink of collapse, especially since the Malian disaster of 2012.  

China’s Sahel overtures:

For a very long time, Chinese policy was based on significant economic investments in the manufacturing industries of the Sahel countries. To this end, the creation, two decades ago of a mixed company between the Government of Mali and the Chinese Light Industry Company for Techno-Economic Cooperation with Abroad (SUKALA s.a) was set up which is today one of the largest industrial companies in Mali and has generated more than 35 million dollars for the Malian State in taxes and duties.

During the1980s China was strongly involved in Sugar Complex of the Upper Kala (SUKALA), Malian Textile Company (COMATEX), Mali Tannery Company (TAMALI), Malian Pharmaceutical Factory (UMPP), Popular Pharmacy of Mali (PPM) were subject to this type of intervention. 

In Niger, the main areas of investment are energy ($5.12 million); mining ($620 million) and real estate ($140 million), other aspects of cooperation include: the construction of stadiums and schools, medical missions, military cooperation, infrastructure (roads, bridges, rolling stock, thermal power plants). 

Malis still struggling to have a legitimate democratic leader elected through free and transparent elections and is floundering in a transition that is the result of two military putsches. In Burkina Faso, the power of President Rock Marc Kaboré succumbs to a great social protest and a soldier’s mutiny on January 23, 2022, under the leadership of Lieutenant-Colonel Paul-Henri Sandaogo DAMIBA, president of the junta that took power on January 24, 2022. Among all these countries mentioned above, only Niger remains the one that maintains a “relative stability”, with its successful democratic alternation on February 21, 2021, which carried Mohamed Bazoum as President of the Republic with a foiled coup attempt on the night of 30 to 31 March 2021 even.

Nevertheless, without being as weak as their neighbours in the Central Sahel, the capabilities of the Mauritanian and Chadian armies are far from exceptional. Renowned for the quality of its intelligence services and rapid intervention units, Mauritania has still not been directly involved in significant fighting for four years. This is important to note as these are the two countries of the G5 Sahel organization that have a certain capacity to respond to the terrorist threats, hence for four years, they have not been directly involved in this scourge.

However, amidst such terse geopolitical realities in a situation of rejection and lack of coordination and results, France and the other European partners are in a situation of weariness and attempting to decide whether or not to reduce their footprints with the G5-Sahel joint force. This will only open further room for Chinese entry.

On the military and security front, China generally contributes to UN peacekeeping operations, for example in Mali as part of MINUSMA where it deployed 403 peacekeepers, including one killed and 12 others wounded in an attack in Gao in the north of the country.   

China pledged more than $45 million to the G5-Sahel joint force in early 2019 and $1.5 million for the operation of the permanent secretariat, in other cases it allied with Russia to block some resolutions initiated by other UN Security Council members on Mali, in addition to the supply of several military equipment respectively to the countries of the G5-Sahel and more generally to those of the African Union. 

THE GEOSTRATEGIC IMPLICATIONS OF CHINESE COOPERATION IN THE SAHEL

The relationship between the Sahel countries and China has evolved over several years of cooperation through investments in various fields whose interests continue to benefit all the different parties. For the former, it allows them to have diversified diplomacy and cheap goods and for the latter to establish its economic and political power in these developing countries. For China, thanks to globalization which has allowed it to liberalize its economy as well as the new law of 2015 that allows the Chinese military and police to intervene abroad as part of so-called “anti-terrorist” missions to protect its economic and human interests, Beijing has created strong political clout in the region that it has transformed into infrastructure according to the needs of these countries (as in Djibouti)  under the Belt and Road Initiative (BRI).

In addition to these donations, it has carved out a significant share of the public procurement of these States compared to other powers in the West within the framework of bilateral agreements; several achievements have been carried out mutually that continue to benefit the interests of each party thanks to the low cost of Chinese products.  

Beijing’s goals in Africa are threefold, with the first being to get acquainted with uncharted territory. These operations allow it to improve its operational capabilities and test new weapons, such as infantry fighting vehicles and 95-1 assault rifles. Exercises are also being conducted at its military base in Djibouti, inaugurated in 2017, covering several terrains: such as the desert of sub-Saharan Africa, urban areas and sea lanes.

“This is one of the least threatening ways for the Chinese military to practice in real theatres of armed conflict,” says Obert Hodzi, an international relations researcher at the University of Helsinki and author of The End of China’s Non-intervention Policy in Africa”. 

This is why the Chinese government is seeking to consolidate ties between the PLA and the African General Staff. At the beginning of the summer, the first China-Africa Security and Defense Forum organized in Beijing by the Chinese Ministry of Defense was an opportunity to define the axes of this cooperation and in particular the issue of “mutual assistance for security”, terms that appeared in 2015 in the second white paper on Africa, which now includes the training of soldiers and the sale of arms.

 China’s influence in the regional security atmosphere

China has even gone so far as to use its economic power to force governments to give it special treatment, as was the case in Zimbabwe, or to defend politicians favourable to its interests as in Zambia or Zimbabwe with the fall of Mugabe. China behaves there like many Western countries that it has previously criticized.

The reason is the defence of its military-industrial lobby. The People’s Liberation Army (PLA) has interests in hotels, banking and real estate. With it, China cannot help but mix trade and politics. Companies, such as ZTE or Huawei in telecommunications, are likely to have to respond to requests or orders from the PLA or the party if the need arises. Beijing is thus drawing its new diplomacy, multilaterally via the UN, and bilaterally by maintaining privileged relations with the Sahelian states or political parties sensitive to its arguments to shale up traditional powers such as France and especially the United States in the region.

Dara Cheick is a student at the Faculty of Administrative and Political Sciences of Bamako (Mali) and a research assistant at the Timbuktu Center for Strategic Studies for the Sahel. He can be reached on Twitter @DaraCheick

Decoding the usage of Sun Tzu tactics in Contemporary Geopolitics

Decoding the usage of Sun Tzu tactics in Contemporary Geopolitics

By – Tanishk Saxena;

Sun Tzu’s ‘Art of War‘ is seminal Chinese military treatise that looks to forecast victory or defeat. China under Xi Jinping has followed his suggestions and satisfactorily executed Sun Tzu’s Military Treatise that have bolstered confidence and built a moral consensus within China to legitimize his decisions. This opinion piece analyses contemporary endeavors by China (domestically and internationally) that fall in line with Sun Tzu’s Military Treatise on laying plans, waging war and attacking by stratagem.

Sun Tzu mentioned that “morality makes the population comply with the ruler regardless of conditions.” (Pg.1) Herein, we see that Xi Jinping has enforced his thoughts on the people by embedding his thoughts in the education system and running re-education camps in the supervision of the Propaganda Department and Education system to build a moral consensus. 


Sun Tzu has also stated that “he could predict victory by analyzing the General’s ability, advantages derived from occupying strategically important grounds, discipline enforcement, increasing the strength of an army, training of officers and men and constancy both in reward and punishment.” (Pg 2). We see that China trains its generals to uphold the spirit of fearlessness and indomitable courage. PLA comrades endure rigorous training under extreme conditions which includes training to use NunChaku, spears and other non-lethal weapon fighting tactics, especially along the India-China LAC wherein firing of weapons is prohibited. It adds to the strength of the forces in hand-to-hand combat. Such training programs boost commanding and fighting capabilities to foster excellent conduct. During the Beijing winter Olympics 2022, Qi Fabao, the regiment commander of the People’s Liberation Army who fought during the Galwan Valley clashes, was made the torchbearer as a reward for his bravery. Concurrently, harsh punishment to officers for indiscipline is a common practice in PLA. China has worked extensively on gaining high grounds and places of strategic importance through its BRI projects, investments and loans globally. These strategic locations include Hambantota port in Sri Lanka and Gwadar Port in Pakistan which adds to the strategic depth of China.

Sun Tzu notes that “deception is at the core of warfare. Strategies should be formed as one is capable and prepared to conduct an attack- must seem unable; and while during aggression- must seem inactive; when close to conduct an attack must make the enemy feel far away; when far away, make him believe to be near.” (Pg 3). During the reign of Mao Zedong, China had limited military capabilities and didn’t hold significant economic might or stature in international politics. At that time, China claimed to reunify Taiwan in coming 10 years. China was very far away from its goal at that time as the presence of western powers and support for Taiwan was certain. Later during the leadership of Deng Xiaoping, China was in better condition after opening up its economy and had made a place in the international system. Deng Xiaoping during his tenure expressed the willingness to reunify Taiwan but changed it from ten years to hundred years. As China got closer to reunification; China made the world perceive it is moving away from its goal through statements of its leaders. Xi Jinping stated in his comment on Taiwan said that ‘China is still willing to reunify Taiwan but did not mention the exact time or year for his plans. Though China seems much closer to its goal to reunify Taiwan with its economic might, maintains a gigantic military, can write international rules and challenge the global governance, it has made its stance that it is outlying away from its plan of reunification. From Mao’s time to now, China has maintained its stance that China will use only peaceful means to reunify Taiwan also seems a deceptive move as it sends regular flights, fighter jets and bombers close to the island.

Sun Tzu has also suggested that “an opponent with a choleric temper should be irritated and then should pretend to be weak against that same opponent so that the opponent may develop arrogance.” (Pg. 3). During the Trade War with the USA, China had used all means to irritate the former President of the USA – Donald Trump, through various means. Donald Trump taking the America First campaign forward – was willing to bring back manufacturing industries from China back to the USA with a key objective to refrain China from taking unreasonable benefits of the international system, but the chronic temper of Trump was also a well-known fact. Xi Jinping imposed retaliatory taxes on the USA products that received retaliation with even more tariffs on Chinese products. Xi Jinping used to flatter Trump during the dinners and unofficial meetings telling him how grateful he is. John Bolton (Former National Security Advisor of USA) writes in his book ‘The Room Where It Happened’, that Xi Jinping’s personal relationships mean next to nothing to him if it is inconsistent with the interest of the CCP and then China. This consistent cyclic retaliation during the trade war and flattering during personal meetings built up arrogance in Trump. His arrogance grew to a level where he started competing with Xi Jinping and stated ‘People are talking about repealing the two-term limit for him. The Trade deal with China that Trump projected to his domestic audience as success went into a hoax. China used this tactic to build up arrogance into Trump so much that he later fired his National Security Advisor Jon Bolton and Defense secretary Mark Esper over Twitter and could not accept his defeat in elections by the Democrat candidate Joe Biden leading to Capitol Riots. 

Next, Sun Tzu’s statement that, “at the time of war: the expenditure is enormous both at home and on the front and suggests to account money required to pay for the entertainment of guests and other miscellaneous expenses” is noteworthy (Pg. 4). 

China has increased its military and defense budget by 7.1 per cent to USD 230 billion from last year’s USD 209 billion. Xi Jinping has paid extra attention to modernizing China’s defense equipment with self-reliance to sustain long wars. The recent session of the Fiscal and Economic Committee of the Thirteenth National People’s Congress emphasized food security, bringing fiscal and taxation reforms. China imports a significant amount of food from outside,  purchasing wheat from Russia and pork is imported through a long channel from Brazil. Having a stockpile of food beforehand during time of uncertainty acts as a tool to mitigate the risk of food security. China’s domestic spending is not standardized and lacks detailing during execution. The use of budgetary funds remains low and allows China to have backup plans/funds in the instance of any black swan event. 

Sun Tzu stated that the objective should be victory and, prolonging warfare campaigns must be avoided. (Pg. 4) We see that China has entered the conflict zone strategically and has always made it on top of its checklist to abstain from entering prolonged warfare. China had strategic plans in Afghanistan and Pakistan attached to its China Pakistan Economic Corridor (CPEC) and broadly Belt and Road Initiative (BRI). Despite strategic goals, China has abstained from directly entering the conflict zone or situation despite being a direct threat to its investments and interests for prolonged nature. On similar lines, Russia sent its forces to support the current leadership of Khaskasths against the coup. China also supported the existing regime of Kazakhstan but did not send its armed forces on the ground, sensing a fear of prolonged war. The pattern observed in various conflict zones where China abstains from entering despite high stakes and interests is for a reason being of prolonged nature. In all these conflicts, the objective of China remained to be victorious even without firing a bullet itself. Moreover, China’s support remained unaffected by the kind of regime it is dealing with.

Sun Tzu prioritized bringing the other state as a whole and intact within the sphere of direct influence. (Pg. 6). China’s strategy to extend loans through AIIB and under its BRI project provides an irresistible bait for any economy struggling. Ambitious leaders willing to bring a huge change within a short span tend to be caught easily into the trap as a desire to project growth is used to gain support,  popularity and acceptance to their people the kind of development brought. China offers loans without any requirement of restructuring the economy as often mandated by Institutions from the Bretton Wood System. The loans extended are offered at a cheaper price but takes tactically important assets for lease or mortgage. Through these means, China maintains the leadership of the state in control and in case of default takes over the assets of strategic importance to China. China under Xi Jinping has used this tactic in Pakistan, Sri Lanka and many other African states. This tactic is also referred to as salami slicing and debt trap diplomacy where loans and investments are provided as bait. These adhere to Sun Tzu’s strategy of bringing a state completely under its sphere of influence intact. 

Lastly, Sun Tzu mentioned that if you know yourself and your enemy well, you will surely win every battle, but if one fails to do so, he will suffer defeat. One who neither knows his strength nor weakness will surely scramble on the battlefield. (Pg 8). China runs extensive surveillance within the country through cameras that can even identify and report the ethnicity of a person and location. It also engages in using artificial intelligence and maintaining strong control over social media outlets. Along with this China maintains strict surveillance over its military leaders, capitalist class, social media influencers, journalists and members of the CCP. China also extensively reviews its domestic projects, population, military capability and situation of various provinces and autonomous regions. This helps China to identify its strength and weakness so that it never crumbles on the battlefield. Chinese companies like Huawei, ZTE, other applications and social media platforms are accused of stealing user data that is further refined and used to acknowledge the actions and to extract vital information from the user whose information is compromised without any consent. China has extensively built Confucius institutes globally along with the Embassies apart from their role in cultural exchange, act as a medium to gather vital information that helps to know more about a potential adversary. China has installed its surveillance equipment in various countries and withholds technological backend data for service and other purposes that can be used for surveillance as and if needed. 

Conclusion

China under Xi Jinping, one of its most powerful leaders since Mao, has effectively implemented the strategies provided by Sun Tzu. Building a Communist Socialist Society with unique Chinese Characteristics, and restoring glory lost during imperialism are key objectives of Xi Jinping.  Sun Tzu, being an ancient Chinese philosopher best suits Xi Jinping to protect the national interest. As he uses the tactics of Sun Tzu in international politics thereby becoming a part of the normal thought process and being used in domestic politics or to pursue his personal ambitions has high possibility. The work of Sun Tzu effectively bolstered the confidence of Xi Jinping while making strategies and taking decisions. Reading Sun Tzu’s work along with the contemporary actions of various state and non-state actors could help better understand and decode contemporary geopolitics.

Tanishk Saxena is Executive Outreach Head at Organization for Research on China and Asia (ORCA). Mr. Saxena is also Project Associate with Asian Pathfinders and is pursuing his PGDM with specialisations in International Marketing, Advertising and Public Relations. Mr Saxena was associated with Mitkat Advisory Ltd. – Information Services Department, Mahindra Rise – Mahindra Construction Equipment as a Management Trainee and as a Mentor at Teach for India (TFI). He has a Masters degree in International Studies from Symbiosis School of International Studies and a BBA-LLB (Hons.). He previously practised as a Criminal Advocate in District and Sessions Court. His research interests include Chinese politics, Private Military Contractors, International Relations, Security Studies and Business Continuity Management. He can be reached on Twitter @tanishk007.

China’s 2027 plan and its implications on India

China’s 2027 plan and its implications on India

By- Nichole Ballawar;

Introduction

As the world undergoes unprecedented changes, China is on the verge of a significant strategic opportunity. According to a communiqué issued at the sixth plenary session of the 19th Central Committee of the Communist Party of China (CPC), China has remained loyal to its initial ambition and mission of achieving happiness for Chinese people and rejuvenation for the nation since its inception in 1921. It has united and led Chinese people of all ethnic groups in fighting relentlessly to win national independence and freedom, and subsequently built an affluent and powerful country while remaining faithful to communist values and socialist convictions. Some excerpts from the communiqué also focused on the People’s Liberation Army (PLA) modernisation program and China’s national security while it called for preparedness, integration, informationisation and comprehensive military training to defend national sovereignty. The focus is “ensure that the goal for which we have been striving for one hundred years is achieved”. Geostrategist Brahma Chellaney maintains that ‘China needs a multipolar world but a unipolar Asia’ which explains Beijing’s aspirations to achieve broader foreign policy goals to realise what Xi Jinping has called the China Dream, which envisions a return to China’s predominance in Asia. Chinese officials have also promoted the notion of “Asia for Asians”, a nationalistic posturing with a reference to the idea that Asians should settle disputes without the intervention of the US.

With the goal of building a modern military by 2027, China desires to refurbish the military with the capability to defend national sovereignty, safeguard against security threats posed by hegemonism in the western pacific region, and protect overseas development interests. “By 2027, the Chinese military will be able to adequately cope with challenges in the western Pacific area, including Taiwan and the South China Sea, as well as border conflicts between China and India”, according to the report US’s department of Defence 

The 2027 milestone is also a powerful propaganda weapon. In the past, CPC has repeatedly set big goals to coincide with historic milestone anniversaries, most significantly the “two centennial goals” reflected in Xi Jinping’s report to the 19th Party Congress. The first centennial aim is to “create a moderately affluent society in all areas” by 2021, the CPC’s hundredth anniversary. The second is to “create a modern socialist country that is affluent, strong, democratic, culturally advanced and harmonious” by 2049, the centennial of the People’s Republic of China’s (PRC) establishment.

The 2027 targets and its important components

Revealing China’s broader foreign policy objectives, an article titled VIRAL In China: Beijing Will Conquer Taiwan By 2025, India’s Arunachal Pradesh By 2040 has detailed China’s expansionist propensities in the near and long term. The piece argues that China will conquer Taiwan, Arunachal Pradesh, South China Sea, Southern Tibet, Senkaku Islands and Russia by 2060. Although the 2027 target does not alter the timeline for military modernization, it does indicate that the next few years will be critical for China’s military growth plan. Ren Guoqiang, a spokeswoman for the Ministry of National Defense, highlighted the four essential features of the new standard.

First, after achieving basic mechanisation and making significant progress toward informationisation, the focus shifts to combining and accelerating the integration of mechanisation, information technology, and advancements in intelligentization. Intelligentization, or the integration of artificial intelligence and similar technology into military capabilities, has been designated by Xi Jinping as a key component of military modernisation in the future.

Secondly, factors such as accelerating military philosophy, organisational form, military manpower, weapons and equipment modernisation have long been seen as critical. The PLA has already undergone major organisational reforms and force structure modifications under Xi Jinping, which is likely to continue in the future. Thirdly, the quality component is meant to stress the need for resource efficiency to optimise the quality and speed of modernisation. Ren particularly mentions that the globe is experiencing the acceleration of “huge developments unseen in a century,” making military modernization even more critical. Notably, this third component is connected to the fourth component, since attempts to combine economic and security plans aim to improve efficiency in sectors such as research and development.

Promoting the simultaneous strengthening of national security and economic development is the fourth major component. The CPC’s military-civil fusion plan hopes to achieve significant progress. The Military Civil Fusion (MCF) strategy is described by the US Department of Defence as “a state-wide undertaking that tries to fuse economic and social development plans with its security strategies.” Policy implementation encouraging MCF has increased dramatically in recent years as a result of high-level prioritising and is expected to be a focus area in the future. The strategy could also aim to stimulate innovation in crucial areas and deploy dual-use technology for military end-uses.

Implications for India 

India has grown increasingly concerned about its rising power imbalance with China, particularly in light of China’s fast-growing military capabilities and the consequences for the disputed Sino-Indian boundary and the Indian Ocean. Chen Hanghui of the PLA Nanjing Army Command College stated in the official PLA Daily that “the military game of great powers will become more intense” in 2022, and “major powers such as Russia, United States, United Kingdom, France, Germany, and India have accelerated their military transformation, focusing on key areas to enhance their high-end warfare capabilities.” As a result, the security risks associated with force modernisation of the PLA are manifold. 

First, China’s Western Theatre Command, Xinjiang military district and Tibet military district are responsible for operations along the Sino-Indian border. For years China has built dual-use infrastructure to prepare for offensive and defensive operations along the border in Tibet. This includes north-south and east-west highways and the construction of feeder roads. With force modernisation and improved connectivity, the PLA has the capability to transform stand-offs into conflicts. Since 2015, the PLA has also commissioned modern weaponry and held several drills to attain “improved joint-ness and efficiency.” The Qingtongxia combined arms tactical training base simulates Chinese-occupied terrain in Aksai Chin, allowing for realistic joint training.

Second, the Academy of Military Science’s 2013 Science of Military Strategy and China’s 2015 Defence Whitepaper both call for a transition from “near seas defence” to “near seas defence and far seas protection,” which means safeguarding China’s interests in the Indian and Western Pacific Oceans. In the previous two decades, China’s presence in the Indian Ocean has grown dramatically. In 1999, there was not a single PLA Navy (PLAN) port visit in the Indian Ocean Region. Since 2011, the PLAN has made over 20 port visits every year. The PLAN can sustain 18 ships in the region based on its current military posture. It already has a naval base in Djibouti, and might acquire a few more in the near future. In 2013, a Chinese oceanographic research vessel spent 2-3 months cruising the Indian Ocean, reportedly monitoring the ocean’s hydrological parameters. Researchers estimate that such high levels of mobility in the Indian Ocean over months are for anti-submarine warfare studies, weapon development, and tracking enemy submarines. 

Third, to boost synergy across its space, cyber, and electromagnetic domains, China established the PLA Strategic Support Force in 2015. In simple terms, this force is in charge of China’s information warfare and electronic countermeasures operations, as well as cyber-attack and defence missions and psychological warfare missions.

Last but not least, China’s military forces are quickly developing space and counter-space capabilities. They have become crucial elements of China’s force projection capabilities. During the Galwan standoff with India, China is said to have placed roughly 16 DF-26 intermediate-range ballistic missile systems along the Xinjiang border. Given the rockets’ attack ranges, India is a likely target.

Apart from these developments, India should be concerned about China’s investments in military technology, big data, drone swarms, and other disruptive and offensive technologies, as well as its military ties with Pakistan. These developments are specifically related to India and have massive strategic and tactical ramifications for India’s border dispute with China.

Conclusion

Henry Kissinger rightly observed that “The Chinese are like compulsive students – for them, no problem is finally solved; every solution is an admission to a new problem.” China’s foreign policy objectives will continue to include provocative actions such as border breaches, a missile development programme, cyber and psychological warfare, as well as power projection capabilities for the near future; therefore, India must mitigate and manage this aggressive behaviour. India and other like-minded powers must acknowledge the dangers posed by the region’s emperor-like regime. The Quad and other minilaterals, particularly trilateral alliances with major strategic partners such as Australia and Japan, have the potential to evolve into military alliances in the future. India must also continue to pursue strategic partnerships in which likeminded partners could work together through regional groupings to promote stability in the region. Collaboration in new domains such as such as health, space, and cyber space along with deepened economic and technological cooperation remains pertinent to address the China challenge.

Nevertheless, India must rely on internal balancing to counter China in the economic sphere as well. If India maintains an annual GDP growth of 8%, it will be a $64-trillion-dollar economy in Purchasing Power Parity (PPP) terms by 2047. Within the same time frame, if China grows at 5% per year, it will have a PPP economy worth $86 trillion. In other words, the current asymmetry will be greatly reduced. Hence, to address Chinese provocations, a judicious use of self-reliance, grounded in self-assurance, in which a confident India engages the world without fear, forms alliances with like-minded countries, and effectively leverages democracy and a skilled workforce is a necessity.

 

Nichole Ballawar is currently working as a Research Associate at the Organisation for Research on China and Asia (ORCA). Formerly, he has worked with the Centre for Air Power Studies (CAPS) as a Research Associate and  Janes as a Defence Analyst. He has also worked with the Ministry of External Affairs as a China Research assistant and United Nations Development Program as an Intern. He worked with organisations like NIICE, The Diplomatist, 9dashline etc. and published various research papers. He is an author of various articles related to China, Nuclear non-proliferation and arms control. He is also a visiting faculty at the Government Law College, Nagpur.