China's rise and implications for international order

Rise of China

Much in international relations has changed over the past two decades beginning with the dissolution of the Soviet bloc and the disintegration of the Soviet Union and continuing now with the slow growth of a more open market in China. For decades, both the U.S.S.R. And China were seen as enemies of the West as both were Communist in their orientation, though the two Communist powers did not always g along themselves, a fact which only made them more threatening to much of the rest of the world.. with the dissolution of the Soviet Union, China became the major Communist power in the world, far more of a threat than Cuba, yet treated quite differently than that smaller country. Where America has kept Cuba outside the world's markets as much as possible and has continued to treat any contact with Cuba as a threat to national security, the U.S. has encouraged investment and other contacts with China, aiding in the economic development of that huge country on the theory that economic development and contact with the outside world would lead inevitably to improved relations and to a more capitalist system in China. Some have seen the economic rise of China not as an opportunity but as a threat, however, viewing anything that makes China stronger as also making the West weaker. The issue is whether this can be deemed a real threat or only an unfounded fear.

The Rise of China

In the United States, efforts to bring China more into the world market has included an argument over whether or not to grant most favored nations status to the country. Despite its name, the most favored nation (MFN) clause of the General Agreement on Tariffs and Trade (GATT) does not mean that any one nation receives preference over another nation with regard to trade. Instead, members of the GATT are committed that products originating in one nation will receive the same treatment as products originating in any other nation. Discrimination and preferences are prohibited. However, Article I, which contains the MFN clause, also provides some exceptions to that clause, including customs unions and free trade areas. In general, however, the goal of MFN status is to give equal treatment to all countries and their goods and to prohibit any one nation from being favored over any other nation. In this sense, all MFN nations are "most favored."

The United States grants MFN status to nearly all of its trading partners. In 1997, only seven nations did not enjoy MFN status. However, even those nations which are granted MFN status may not have unconditional status. Waivers have been obtained by the president for a number of countries, including China, which otherwise would not be eligible for MFN under U.S. rules. Such countries can enter into a bilateral trade agreement with the United States, or may be determined to be in compliance with the Jackson-Vanik amendment of the 1974 Trade Act (this amendment has implications for free emigration). It is under these conditions that China has been granted MFN status, but because China's status is not unconditional, it is subject to Congressional approval based on the president's recommendation.

The issue of MFN status for countries is both political and economic. By reducing tariffs for Chinese goods, as an example, American companies which use those goods in their own products can purchase them at prices which are well below what they would have to pay if the MFN status were not in place. However, critics of MFN status to China point out that China has no incentive to open its market to American goods, and that the U.S. trade deficit topped more than $60 billion in 1998.

Until 1978, China had a controlled, centralized, Soviet-style economy, and it then began to try to develop a more market-oriented system, one which still operates within a political framework of strict Communist control, though the economic influence of non-state organizations and individual citizens has been increasing. China wants to become a full member in the world trading community through membership in the World Trade Organization in particular. In recent years, the People's Republic of China (PRC) government has sought membership in GATT (General Agreement on Tariff and Trade) and its successor, the World Trade Organization (WTO). The PRC has made many concessions concerning economic liberalization to gain this objective.

In the United States, trade with China would become a primary issue, with potential membership in the WTO seen as necessary by China though opposed by some other countries. The United States Congress has often opposed giving Chine MFN (most favored nation) status because of human rights abuses. Dramatic media exposes with a former prisoner posing as a Chinese-American investor sparked public outrage and demands for tough sanctions against Chinese exports to the United States in the early-1990s. Another sticking point has been U.S. support for Taiwan, what is left of the old republican government exiled to the island nation east of China, with both wanting a reunited China under their particular rule. The United States has never recognized Taiwan as a separate country, but at the same time, any threat to Taiwan form mainland China has been met with strong opposition and even the threat of military action. Recently China warned that it would not allow Taiwan to take a different course from mainland China and implied that it would soon be seeking to take control of the island once more. To Americans who continue to view the PRC as a hated enemy, however, any action, however drastic, is justified to pressure the PRC to leave Taiwan alone. In reality, however, Taiwan is a part of China. The presence of a separate state on the island is evidence of a civil war that has yet to be completed.

Foreign Policy and Intentions

Stifling political dissent and the use of prison labor in the PRC to manufacture goods for the United States market has been a focal point of moves in Congress to challenge China's most-favored-nation (MFN) trading status with the United States. Dramatic media exposes with a former prisoner posing as a Chinese-American investor sparked public outrage and demands for tough sanctions against Chinese exports to the United States in the early-1990s.

Political concerns within the PRC extend far deeper, however, than the hot-button human rights issues. Within the PRC, the issue of the allocation of political power must be faced by the government. Leninist-type centralization is no longer feasible because of the political and economic reforms implemented. At present, while China has a one-party dictatorship in prescribed Leninist fashion, "all of its political institutions are fragile and a meaningful federal system has not yet been devised." Social and political values also pose a problem in the contemporary PRC. The efforts at indoctrination go forward in schools, military installations, bureaucratic branches of government, and all other organizations.

The political policies being pursued in the contemporary PRC do not seem likely to lead to democracy. Rather, according to Scalapino, "these policies appear to be leading toward authoritarian pluralism. Politics remains authoritarian, with political choice limited, freedoms restricted, and law frequently subordinated to the will of the government. There is, however, a strong element of uncertainty on the part of these who govern."

Ultimately, however, the resolution of the political situation within the PRC is a domestic matter for the Chinese to sort through to a solution. This political issue is not one on which the United States should attempt to pressure the PRC to conform to some Western model of democracy. Qian Qichen, Deputy Prime Minister and Minister for Foreign Affairs of the PRC, said in an address to the United Nations (UN) that no peace-keeping operations or humanitarian aid programs should be permitted to interfere in the internal affairs of any country, still less to use force or become embroiled in a conflict between the parties. While the Deputy Minister couched his remarks within the context of the resolution of international actions under the auspices of the UN, his message also was clear on the fact that the PRC will not accept what it considers to be external interference by any country or organization in the domestic affairs of the PRC.

China: Opportunity or Threat?

In some sense, the answer to this question might be that China could be both. China is certainly an opportunity for those companies that can get into that market and make a good deal for themselves, and China's rise might be a good thing for world trade in many ways. China could still pose a threat. It could pose an economic threat if its huge population became the sort of consumer base some hope it will be. When the idea of China as a threat is raised, though, the threat is not simply economic but political.

Emma V. Broomfield says that the threat could be ideological, economic, and strategic, though any threat would be based on the growing economic power China has been developing. As she notes,

Since economic reforms were instituted in 1979, China's economy has liberalized and expanded and its leadership has striven to modernize its army in an effort to prove to the world that China is not just a third world developing country. Some policymakers and academics have interpreted this rise as a serious threat, directed specifically against the United States, its friends, and the Western way of life.

The belief on the part of some is that China will gain enough economic strength to threaten the peace and security of the West and specifically to challenge the United States on issues like Taiwan. They also see a threat to American security as China infiltrates U.S. capital markets. In addition, "they point to China's poor record on proliferation, its weapons sales to many of America's adversaries, and its largely successful attempts to gain dual use technology and elicit military secrets through espionage as undeniable threats to American national security."

Vincent Cable and Peter Ferdinand note the conflict presented by the more open economic policies of China, at least as compared with the past, pointing out the economic opportunities seen by many companies while also asking if an improved economy for china constitutes a threat for the future. They note that the economic power of China is a function of both its size and its growth, and the change has created a new interest in Chinese markets: "While China remained a closed economy, the size and living standards of its domestic economy were of largely academic interest to the rest of the world." The authors state that prosperity for China will create both problems and opportunities, with the problems including economic competition, increased pollution, and the development of an economic platform for military actions. The authors recommend caution because the opportunities being held out today could be taken away tomorrow if China shifts back to more inward-looking forms of development, as has happened in soe economics in the past. Political uncertainties about China are especially troubling, and the human rights abuses revealed from time to time show that the ruling regime is not as secure as it makes it appear.

Gerald Segal recognizes that the huge population in China is a tempting target and that this makes the Chinese economy seem important to the world, but he also finds that weaknesses in the economies throughout East Asia makes this market less stable and less certain than some assume. China is most important, he says, to other economies in East Asia, though investors in the west are looking to China as if it will be a major boon to their fortunes. Segal also points out that China is a second-rate military power and accounts for only 4.5% of global defense spending, while the United States makes up 33.9%: "Beijing clearly is a serious menace to Taiwan, but even Taiwanese defense planners do not believe China can successfully invade." Segal calls for the United States and others in the West to stop viewing China as a power commensurate with its size and to see China more as another Brazil or India.