April 28, 2021 | China's Rise Is Not Occurring In A Vacuum
China's leaders see China's rise as inevitable. Even if that's true, they shouldn't expect the US to sacrifice core national interests let it happen.
A major source of US-China tension is a failure to mutually recognize redlines and acknowledge the others’ constraints. Both sides are guilty of this, and the result is a failure to find alignment across a host of core interests.
Turning towards China’s view of the United States. China sees its own rise as inevitable and believes the US should prepare to hand over economic and technological dominance in the years to come.
We see a condensed version of this view expressed by China-born, US-educated, and Hong Kong-based private equity investor Weijian Shan in a recent interview with the Harvard Business Review.
When asked, “What are the dangers in America’s continued demonization of China?” part of Shan’s response included the following:
Let’s be honest: A rising China may be a threat to America’s economic and technological supremacy, but not to its national security, because China doesn’t export its ideology or political system and doesn’t seek regime change anywhere in the world.
Although Shan is a private business person, this specific view is shared widely within the Chinese Communist Party (CCP) establishment. Many officials across factions and internal ideologies believe the United States does not want to see China rise. There are three reasons why this view won’t help improve US-China relations.
The US is allowed to have national security interests too.
Shan’s response denies the validity of the United States’ core interests and assumes the US’ technology and economic dominance can’t be national security interests as well. We could argue US dominance has no relation to American values, which are way different from interests. But that’s not the argument the CCP makes.
It’s becoming increasingly clear Chinese leaders see economic and technological supremacy as the keys to supporting both national security interests and the Chinese Communist Party’s domestic legitimacy.
Chinese leaders betting the house not just on China’s rise but also on the inevitability of the United States’ decline. Neither are foregone conclusions, and the expectation that the United States will hand over its competitive advantages to its only near-peer competitor is wishful thinking.
It’s not possible to separate technological dominance from global influence
One of the main arguments Chinese leaders use to assuage global fears of its rise is that China has no intention to export either its governance model or ideology. This may actually be true in theory, but it won’t work this way in practice.
Geopolitics in the 21st century will be fully integrated with emerging technologies such as artificial intelligence (AI). AI will be a fixture in the lives of nearly everyone on Earth and already is in some ways. Many in the developed world are already in constant connection with artificial intelligence software and platforms without even realizing it. If you have a smartphone, you’re using artificial intelligence.
The leader in the race for global technology supremacy will also be leading the race to establish global norms, standards, and regulatory frameworks. Whoever is responsible for setting these norms, whether it’s China or the United States, will undoubtedly rely heavily on domestic political values to lead the way.
Even if China is serious about not exporting its political values and ideology, it doesn’t matter because technological dominance will come bundled with a mandate to set global norms. Techno-authoritarian dominance will produce techno-authoritarian global norms.
China’s rise still hinges on the United States.
Chinese leaders publicly promote China’s rapid rise as the result of Chinese resourcefulness and independent will. Reality is different. China has benefited more than any country under the rules-based world order of the past three decades. To this day, China’s growth is still deeply dependent on US consumer demand and technology.
In recent years, Chinese President Xi Jinping has attempted to carve out major structural reforms to reduce US dependencies. One of those initiatives is the “dual circulation” economic strategy, a long-term reconfiguration of China’s economy to maximize the benefits of China’s global economic engagement while reducing exposure to the United States.
China’s push for self-sufficiency extends to semiconductors as well. Although China holds a clear lead over the United States in some advanced technologies such as 5G telecommunications, China is still fully dependent on US chip designs and global supply chains to build out its tech base. China has invested billions of dollars over the years to build out a self-sufficient semiconductor sector to eliminate the need to rely on US chips.
Although China is trying its best to eliminate dependency on core US strengths wherever possible, it has not found success. China’s dual circulation strategy is largely an extension of an economic policy that has failed to reform China’s economy in the past. China’s IC sector is still at least 5-10 years behind other competitors.
Conclusion
Chinese leaders frequently deny their intent to export China’s ideology and system of governance to the world. However, as long as China aims to replace the United States as the world’s leading economic and technological power, US-China tensions will continue to converge around these issues. Both the United States and China need to begin to seriously recognize mutual redlines and national security interests. If this doesn’t happen, tensions will continue to deteriorate.
Even if Chinese leaders view China’s rise as inevitable, it’s unreasonable to expect the United States to abandon core national interests willingly.
Previous Notes
Additional Reading
“Americans Don’t Know How Capitalist China Is”
Weijian Shan was born in China and had his life upended by the Cultural Revolution. Educated in the United States, he worked for the World Bank and J.P. Morgan and taught at the Wharton School. Today he is the CEO of PAG, a $40 billion private equity firm based in Hong Kong. In this interview he talks about the accessibility of the Chinese market, America’s demonization of China, what the Chinese don’t understand about the U.S., and more.
Photo by drmakete lab on Unsplash