Hidden risks for Australia in Xi Jinping’s vision for China

Illustration: Eric Lobbecke

Xi Jinping is a big cat on the world stage. As an individual, he is second only to Donald Trump in global power. And he has just told us what he thinks will be his country’s future.

We should pay attention.

Xi Jinping’s speech to the 19th congress of the Communist Party of China was not for the faint-hearted. Its title is a subeditor’s nightmare: “To secure a decisive victory in building a moderately prosperous society in all respects and strive for the great success of socialism with Chinese characteristics for a new era”.

Even the most practised panda hugger at the Australian National University could not describe official Chinese prose as pithy. And Xi fully lived up to the culture of communist prolixity, speaking for a staggering 3½ hours.

This was a speech designed for the history books. And history will surely pay attention to it.

Several big themes united Xi’s speech. One was that the Communist Party will rule China forever. Its ideology is strong and based on its own history, and will not be ­infected by alien notions such as liberalism or democracy as understood internationally.

Xi several times did describe his country as democratic, not least when he signalled his aim that China should become “prosperous, strong, democratic, culturally advanced, harmonious and beautiful”. But Xi’s conception of democracy bears no relation to Western ideas of democracy. As John Pomfret argues in The Washington Post, Xi is an explicit defender of Joseph Stalin’s legacy.

On political reform, Xi said: “We should not just mechanically copy the political systems of other countries … We must unwaveringly uphold and improve (Communist) Party leadership and make the party still stronger.”

There were a couple of nods towards market-friendly economic development but, slightly confusingly, Xi also declared that the Chinese government would “support state capitalism in becoming stronger”.

We shouldn’t be too scriptural, though, about such a long speech. Analysts note that terms such as market and reform appeared much less frequently in Xi’s speech than in the speeches of his predecessors a decade and more ago. But it is the overall thrust of the speech, and of policy, that is important.

Analysts are right to suggest the Chinese government has moved into a “post-reform” period. Economic reform is over; political reform has gone solidly backwards during the past five years.

Economic development, of course, will continue, but it will do so under the present model, where state-owned enterprises dominate the commanding heights of the economy and all businesses, state-owned or private, are required to have Communist Party committees at the heart of the management, and are subject to direction by the party and the state.

Xi promised his people a cleaner environment and said living standards would continue to rise.

The tone of his speech was strongly nationalist. He emphasised the central importance of continuing to expand and modernise the military. And unlike any of the postmodern falderal that you get in the West, Xi was clear about the purpose of the Chinese military: “to win a war”.

He was not, let me hasten to say, threatening, promoting or even contemplating war but he was clear that winning a war was the purpose of the military.

He was also tough on Taiwan and determined that China would be a great power, and eventually the leading power in the world.

The direction in which Xi wants to take China is quite clear, but Beijing’s future politics and policy remain deeply unpredictable.

In an acute contribution in Quadrant magazine, former ambassador and intelligence analyst Peter Rowe notes how modern Chinese politics has never really run according to predictions.

Even the most powerful Chinese leaders have not been able to secure their preferred successor in office, for example. Chairman Mao Zedong lost one supposed successor, Lin Biao, and could not push the claims of his wife, Jiang Qing. His ultimate replacement, Hua Guofeng, was brushed aside by Deng Xiaoping.

Deng himself also went through preferred successors, Hu Yaobang and Zhao Ziyang, neither of whom made it to the top.

Anybody who tells you anything about China’s future with certainty should be treated with extreme scepticism.

For all that, Xi is emerging as the most dominant and powerful national leader since Mao. Sinologist Geremie Barme has labelled Xi China’s COE — chairman of everything.

He has centralised all big decision-making in his own hands. For the moment at least the forms of China’s governing institutions are being maintained, but Xi is at the top of everything and in charge of everything.

Many of the traits of a cult of personality have grown around Xi. There is constant speculation that he will seek a third five-year term, breaching the post-Cultural Revolution convention that leaders should be limited to two five-year terms.

Thus Xi has tremendously diminished, if not altogether wiped out, the fragile institutionalism Chinese leaders tried to create under Hu Jintao and Jiang Zemin.

This highlights perhaps the central contradiction of the Chinese system and guarantees its ultimate unpredictability.

A poster in Beijing depicts Xi Jinping with the slogan ‘Chinese Dream, People’s Dream’.

In a one-party state, power cannot be effectively divided. Most national leaders in most societies would like to stay on until senility or death overtook them but are prevented from doing so by term limits or the electorate. They cannot change the rules because they are constrained by constitutions and courts. And their performance is checked against reality by media scrutiny.

To some extent, the Chinese government under Deng, Hu and Jiang allowed a small amount of this sort of institutional checks-and-balances approach to creep in under the authority of the Communist Party.

But such an approach never had a secure basis because power was never truly divided. One strong leader could brush all the checks and balances away.

Thus a power such as India, which has a government generally much less efficient than China’s, is nonetheless much more predictable because its courts, media and federal structure limit the power of any central government, while the electorate periodically gets sick of the government and throws it out.

Part of the immense, historic challenge that Xi and his government pose to the world is their clear belief, which may be idealistic as well as self-interested and ruthless, that the inefficiencies of democracy and autonomous institutions outweigh any benefits that they might provide, and that ­dictatorship is a more effective path to economic development, national power and international leadership.

You cannot say they don’t have a case.

China’s long-term economic growth, sustained so far under Xi as much as any of his predecessors, is mainly the old East Asian government-led growth story writ large. But given China’s scale, it is still a revolutionary achievement.

Whatever criticisms we may have of the Chinese government, it is always worth bearing the scale of this economic achievement in mind.

Former US State Department official Anja Manuel has pulled some of the stats together in a useful contribution in The Atlantic. Already, China’s middle class probably numbers more than 250 million. Even without the inherent optimism of straight-line projections, this number will grow substantially.

Although the Chinese economy remains much smaller than the US economy, its global reach is impressive and its absolute size immense. Ninety-two countries have China as their biggest export or import partner. The comparable figure for the US is 57.

As Manuel points out, a huge challenge for everyone in the international system is that Beijing uses its aid, trade and investment directly to further its geo-strategic interests — and these interests are certainly not always benign.

China’s Belt and Road Initiative is a case in point.

It was formerly called One Belt One road but, in a rare sign of responsiveness to public opinion, Beijing changed its name to make it seem less prescriptive.

According to Manuel, about $US300 billion ($382bn) has been spent on BRI infrastructure projects already and Beijing claims it will spend $US1 trillion over the next decade. China now lends more money to other nations than does the World Bank.

Nonetheless, BRI is extremely problematic. Almost all this money China advances to other nations takes the form of loans — no longer even at concessional rates — and some aid-dependent nations are developing crippling debts to China.

In some cases Beijing insists on effective control of the infrastructure. It invests in countries with appalling human rights practices, thus reducing the effectiveness of international pressure on them.

And technology transfer is very rare. Beijing often insists on using a Chinese workforce.

In Pakistan, Manuel notes, Beijing employs 7000 Chinese nationals on an economic corridor project. Pakistanis are mainly employed as security guards — 15,000 in number — to protect the Chinese.

The federal Labor Party is considering signing up to BRI if it reaches government, though it hasn’t made a decision yet. It is difficult to see any upside for Australia in such a move.

We are not desperate for Chinese investment, which in any event is flooding into Australia. Signing up to the BRI, in principle and in the abstract, means endorsing its extremely problematic geo-strategic objectives, yet every project would still need to be evaluated on a case-by-case basis.

Some in federal Labor don’t seem to be paying attention. But Beijing never meaningfully rewards such obsequiousness anyway.

The problems for Australia in China’s new assertiveness and nationalism are obvious. We don’t like Beijing seizing territory, creating artificial islands and putting military facilities on them across the South China Sea. The government and the most important agencies of government have warned us in a series of recent interventions about Beijing’s efforts to interfere improperly in our politics and society. The outgoing head of the Defence Department, Dennis Richardson, told us bluntly in a speech that China was one of the most active countries deploying espionage against Australia.

ASIO in its annual report told us foreign countries are seeking to influence ethnic communities and our media to stop criticism of these foreign governments. It is clear the intelligence agency is primarily referring to Beijing.

The head of the Department of Foreign Affairs and Trade, Frances Adamson, made a speech recently calling on universities to stand up for traditional academic values and against efforts to censor on Australian campuses debate that may be seen as critical of Beijing. The government will soon introduce legislation to try to limit foreign interference in Australian politics.

The fact we don’t know what Beijing’s ultimate ambitions are is not a reflection of ignorance on our part or a lack of China expertise. The Chinese leadership may not yet know the limit of its own ambitions.

It is a mistake, analytically, to invest the Chinese leadership with an all-knowing strategic plan that it unfolds remorselessly. There may be a great deal of opportunism involved.

As analyst Linda Jacobsen wrote recently: “We do not know what kind of a (regional) order Xi Jinping aspires to.”

By common consent probably the most acute international thinker we have produced in recent years is Peter Varghese, a former head of DFAT who has also held many other critical positions in government and intelligence agencies.

In his recent Griffiths lecture he made two critical points.

One is that the only sensible policy for Canberra towards Beijing is to engage as well as balance China. And two, calls for Australian foreign policy to be more independent are not only mistaken but probably quite damaging. This is because Australian policy is entirely independent already. We have been pursuing our national interests, explicitly and effectively, these many years.

Varghese didn’t go on to say this, but in truth mostly when people say they want a more independent Australian foreign policy they are talking about being a bit more anti-American, or they are effectively in that camp that follows, with various amounts of throat-clearing and hesitation, whatever line comes out of Beijing.

A nation’s domestic political culture always influences its ­international behaviour. China has become far more repressive internally under Xi.

In Nineteen Eighty-Four, his dark and prophetic fantasy, ­George Orwell foresaw a dictatorial central government — Big Brother — keeping people under surveillance through their television sets. Orwell’s imagination had leapt ahead of the technology. Beijing now uses the internet to give life to Orwell’s vision.

It is right to say we must deal with the People’s Republic of China as it is rather than as we would like it to be. We surely should not abandon, though, all concern for human rights in China — as Beijing’s walking away from its human rights dialogue with Canberra, as revealed in The Australian this week, demonstrates it badly wants us to do.

And we need to be especially hard-headed in understanding our own long-term national interests in what is likely to be an increasingly difficult region.

To put it mildly.