June 2023

De-risking, not decoupling?

The Democracy Forum’s  latest virtual seminar flagged up diverse views on US-China hegemonic rivalry in the Indo-Pacific, and its impact

Following on the heels of the recent G7 leaders’ summit in Hiroshima, The Democracy Forum hosted a webinar on the effects of US-China rivalry in the Indo-Pacific, which examined the strategic consequences of global power politics in this key region.

While the war in Ukraine might have beenhigh on the G7 agenda, the debate’s moderator, former BBC Asia correspondent Humphrey Hawksley, highlighted the presence of the ‘big beasts’ of the global south at the summit, including India and Brazil. What do the global south leaders think of the fractious US-China rivalry encroaching on their nations? he wondered. And which will or should prevail: US or Chinese values, or neither?

In his welcome address, TDF President Lord Bruce referenced US President Joe Biden’s closing remarks to the G7 summit, which conceded that dialogue should resume and expressed expectations of a ‘thaw’ in Washington-Beijing relations. However, Lord Bruce pointed to the emerging political consensus in Washington for decoupling of trade and economic engagement, which clearly seeks to unwind globalisation and pursue a national industrial policy instead. This was bolstered by the introduction of comprehensive export controls in October last year, whereChinese companies have been prevented from developing cutting edge technologies with military applications. China’s foreign ministry responded to the G7 communique with the same accusation of hegemonic behaviour, complaining that ‘the G7 talks about pursuing a peaceful, stable and prosperous world [while] actually doing things that are undermining world peace and regional stability’.

Clearly, we are witnessing the strategic use of trade policy as a first line of defence by both the US and China, to define and delimit their hegemonic interests in the Indo-Pacific region. But it is interesting to speculate, added Lord Bruce, that this strategy may not achieve the intended results, as research published by the World Bank and the IMF, which closely examines the impact of US trade policy on supply chains in the Indo-Pacific region from 2017-2022, indicates that, ‘despite significant reshaping, China remains the top trade partner of the US’. Other commentators suggest an emerging paradox with unintended consequences: for while Western leaders are trying to unpick decades of globalisation, Asian nations, from Bangladesh to Indonesia and Thailand, view China as central to their economic future, and hence seek more trade with Beijing, rather than decoupling.

TDF China-US seminar May 24
Panellists at TDF’s May 24 webinar

In considering the domestic foundations of US power projection in the Indo-Pacific and the true extent of US commitments in the region, most notably the Western Pacific and the Indian Ocean, Dr Peter Harris, Associate Professor of Political Science at Colorado State University, argued that the depth of such interests might be weaker than most people understand.Why does it matter how strong they are? For people in the region, it matters because they need to have a firm grasp of how durable and credible US commitment there is. China, as a ‘resident power’, cannot help but engage with the Indo-Pacific. But the US is a resident power only through choices, not geography, and could decide to retrench from the region. It matters to the American people because they need to know why so many of their military forces are stationed in the Indo-Pacific, what they might be used for in the future, and the risks of this. As for the rest of the world, they should be prepared for what an era of US engagement in the Indo-Pacific might look like, or even an era of US ‘strategic confusion’ and inconsistency.

Harris also stressed that US foreign and defence policies in the Indo-Pacific have economic and human consequences, with forces in Japan, South Korea, Guam, etc, which exist to deter war with China, but also to win a war if necessary – what Harris called the ‘paradox of deterrence’. In the event of a war with Taiwan, China would assume US involvement and make pre-emptive strikes against the United States, he believed, and this level of risk cannot be tolerated indefinitely by the US. China is not trying to overturn the world order, Harris argued, but rather reshape it; so the hegemonic struggle is not an existential one, as the Cold War was.

In the event of a war with Taiwan, China would assume US involvement and make pre-emptive strikes

Assessing the state of transatlantic coordination, and the opportunities therein to address the China challenge, was Carisa Nietsche, Associate Fellow at the Transatlantic Security Program, Center for a New American Security. Alluding to America’s ‘secret weapon’ in the US-China competition – its allies and partners, especially those in Europe – she considered where their views both converge and diverge, and how the differences could be managed.  Nietsche said there was reason to be optimistic over areas of common ground such as risk assessment, an uptick on calling out China’s human rights abuses, and de-risking as opposed to decoupling, which was highlighted at the G7 summit.

However, she believed there is cause for concern that the US and Europe are not always on the same page when it comes to the China challenge. While Europe’s China policy is driven by the ‘holy trinity’ of viewing China at once as a partner, a systemic rival and an economic competitor, there is very little mention of partnership in the US’s national security strategy re. China, which could risk sidelining its allies. Nietsche also emphasised the significant role of the global south, saying that the EU, the US and Britain need to engage the global south as an equal partner, and not risk falling into past colonial traps.

James Rogers, Co-founder and Director of Research, the Council on Geostrategy, questioned the assumption that there are competing hegemonies, in the Indo-Pacific or elsewhere. While China has benefited from the hegemonic order that the US and its allies have established since the end of the Cold War, and China’s economic and power growth has grown substantially in this time, its extent and impact have been exaggerated. China’s ambition may be not to remain part of the global order, but to shape it according to its own interests, and those of the CCP. Rogers believed there is a risk that we will see increasing divergence in coming years, and it is ‘almost inevitable’ that two blocs will form. A traditional focus on gross rather than net indicators of power are not necessarily useful, he argued, as such calculations show China is 90 per cent weaker than the US in terms of net power. Even looking at longer term indicators – for example, China’s ageing population and population decline, versus the US’s increasing population – there is no sign that China will overtake the US, as China’s much less stable population structure is not the kind of base from which a country can construct an alternative hegemonic order.

Collective punishment is used to silence dissent

The debate about US-China hegemonic competition, in the Indo-Pacific and elsewhere, can begin to obscure more than it illuminates

However, this is not to say that concerns do not exist among countries such as Japan and India, given that China’s naval capabilities have increased significantly in recent years. So, concluded Rogers, we will continue to see a deteriorating situation in the Indo-Pacific as a new cold war, waged under nuclear conditions, will encourage a protracted form of confrontation. This significantly more volatile period puts a greater onus on the UK, the US and their allies to think carefully about how to deter miscalculations on the part of China.

For Dr Jason Kelly, Senior Lecturer at Cardiff University’s Dept of Politics & International Relations, challenges arise when we think about US-China relations in the Indo-Pacific solely (or even largely) through the lens of hegemonic competition. He examined the perils of fixating on fear and expressed concern that, as ever more voices participate in the Indo-Pacific conversation, we lose some of the nuance that is essential to understanding the situation. Thus, the debate about US-China hegemonic competition, in the Indo-Pacific and elsewhere, can begin to obscure more than it illuminates. He acknowledged the importance of having the US-China hegemony conversation, but cautioned against framing the two countries’ relationship solely as hegemonic competition, as it can generate a negative value judgment on both sides. Indeed, Kelly reminded the audience, both the US and China renounced hegemony when they signed the Shanghai Communique in 1972.

Increased use of these kinds of framework can reduce flexibility and cooperative measures, warned Dr Kelly; after all, does anyone really knows the intentions of President Xi or the CCP in the Indo-Pacific or elsewhere? No – so the danger is that the notion of competing hegemonies is a seductive way of filling in these blanks. If the ‘hegemony’ view is too entrenched, we lose sight of other factors we might need to know, which can have serious implications for policy.

CPEC project Beijing
Beijing is seeking to project its power and accumulate the resources of other countries back into its own economy through projects such as CPEC

Closing the event, TDF Chair Barry Gardiner MP drew attention to China’s activities in the Indo-Pacific region, such as the BRI, CPEC and String of Pearls, through which Beijing is seeking to project its power and accumulate the resources of other countries back into its own economy. He spoke of China’s territorial disputes with India, as well as with Taiwan, adding that we need to de-risk any conflict between the US and China, and try to normalise relations. On the presence of India and other non-G7 countries at the summit, Gardiner said nations such as India are huge global powers that will ultimately be as important as the G7, becoming dominant players this century. It can, he concluded, only be a good thing to have India’s and other representative voices from the global south giving the G7 a ‘reality check’ about how others perceive them.

Richard Gregson is a  freelance journalist currently based in Canada