Will economy give Xi muscle to flex?


China enters 2021 on a high. Even if it wasn’t, Beijing would manufacture one. This is the Chinese Communist Party’s 100th anniversary so there must be bells and whistles. However, Beijing’s leadership feels the imperial ambitions of the Middle Kingdom are going well. China, though its own bungling led to Covid-19 becoming a pandemic, is spreading the word about its success in stamping out the virus. Xi Jinping faces novice leaders in two of China’s main rivals, the United States and Japan. Its sharply rebounding economy will be the driver of any global revival.

They started the fire, but want to be remembered as the phoenix who rose from the ashes. That is the narrative Beijing will push over the next few months. It’s one reason China has gone hammer and tongs at Australia and others who have called for a robust investigation as to how the pandemic began. The other part of this Covid alt-news will be about how Sinopharm’s vaccine was the only one provided to the affected.

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Xi will see no reason to be less wolf warrior-ish this year. Things worked out reasonably well last year despite the pandemic. President Donald Trump’s tariff strikes were hard but not true. The United States earned as much negative press as China for committing less sins. Foreign minister Wang Yi last month dismissed the US’s attempts at stitching together an international coalition against China, correctly saying “the overwhelming majority of [other countries] do not want to take sides.” Beijing’s influence expanded across Eurasia, Africa and Latin America. Leaders from Germany to Sri Lanka offered economic concessions as tribute. Some things did not go as planned. Galwan Valley was supposed to bring India down a peg but backfired quite bloodily. No matter, as far as the Chinese public is concerned the incident never happened.

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Beijing will have more on its domestic plate in 2021. Besides the 100th anniversary party for the Party, it will also adopt its 14th Five Year Plan. Xi has promised some tectonic economic shifts. He has said the Chinese equivalent of “vocal for local” will play as great a role in growth as exports. He has also committed to creating a net zero carbon economy. Fluff or fact? That will depend on the Five-Year Plan’s fine print. But expect a template on how to set up a separate supply chain structure and universe of cyber standards independent of the West: decoupling with Chinese characteristics.

Beijing will accelerate its ambitions to create a new illiberal world order. This will also mean bad news for the likes of Xinjiang, Tibet and Hong Kong who will recede further into darkness. If China is to create a sphere of influence across the world, it will have even less patience for different strokes among its own folks.

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The keel of its fourth aircraft carrier will probably be laid this year. The airspace of Taiwan and Japan will be harassed endlessly by drones and fighters. Indian officials are braced for the possibility of border hostilities resuming in the spring. Yet Xi is likely to be more cautious about using China’s still limited military capabilities.

Beijing’s main policy focus will be to roll out economic carrots and sticks to get other countries to sign on the dotted line of a Sinocentric economic order. In the case of India, it will largely be sticks designed to warn others of the dangers of trying to decouple from China. The Chinese economy will be Xi’s big red selling point. Despite being overloaded with debt and increasingly hostile to its own private sector, growth will clock in at 8% or more this year. GDP will nearly touch $16 trillion and probably overtake the European Union. These figures, Xi would hope, will ensure the world will forget about the curious incident at Wuhan in the night time and contemplate only the greater glory of the Chinese Communist Party.



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