Tag Archive for: China

Indonesia’s Covid-19 crisis: China to the rescue?

The rapid spread of Covid-19 throughout Indonesia is a serious challenge that could have strategic implications for Australia. But, unlike in previous disasters, there’s little Australia can do to assist Indonesia in the short term. Instead, it will be China that comes to Indonesia’s rescue.

After weeks of denying that it had any Covid-19 cases and claiming that adequate screening measures were in place, Indonesia now faces a health disaster. Although the first infections were reported only a month ago, current numbers indicate that more people in Indonesia are now dying from the virus than have recovered, giving it the highest death rate in Southeast Asia. It’s also ranked among the lowest countries in the world in terms of its testing rate, which suggests that numbers could be worse than reported.

The virus has already been detected in 29 of the country’s 34 provinces, and the densely populated areas of Jakarta, Banten, West Java, Central Java and East Java have over 80% of the more than 1,000 confirmed cases. Videos posted on social media showing Indonesians collapsing of respiratory failure on the streets of Jakarta have sent most of the middle class into self-isolation, forced some ethnic Chinese to seek refuge in Singapore, and driven the elite inside the walls of military compounds and gated communities to wait out the crisis.

The central government has tried to follow other countries by implementing work-from-home and social-distancing measures, but they’re proving difficult to enforce. Millions of Indonesians depend on the income from the informal sector built around the movement of people for their day-to-day living.

Ironically, the closure of offices, markets and factories across Java is increasing the risk of local transmission. Many Indonesians can’t work from home and the decline in economic incentives has forced thousands to return early to their villages ahead of the post-Ramadan Idul Fitri holiday period, likely spreading the virus further. It will be some time before Indonesia and its people understand the true extent of the crisis they face.

The government is now considering a local travel ban to prevent millions from returning to their villages, but it may be too late. Local transmission outside the capital has already occurred, and the safest place for many may now be their villages. Leaving the city could give the urban poor a better chance of isolating for an extended period. The Indonesian military is already building makeshift regional hospitals and commandeering non-vital government property in preparation for what will likely be thousands of patients in the coming weeks.

Indonesia’s health system is struggling to cope with the few cases that it has detected. The country has one of the worst deficits in hospital beds per capita in the region, with about 310,000 for its 260 million population, which roughly equates to 1.2 beds per 1,000 people. The ratio is even worse for intensive care beds, at about 2 beds per 100,000 people. Many of Indonesia’s hospitals also lack stored oxygen, ventilators and other equipment that can save patients with severe infections.

Even if Indonesia can increase its number of beds and acquire enough medical equipment to keep up with demand, it still lacks skilled respiratory and intensive care practitioners. This makes healthcare workers the key to the government’s response and is why the government needs to prioritise the supply of personal protective equipment to frontline workers. At least seven doctors have already died from Covid-19 infections and hospitals have resorted to stop-gap solutions such as plastic raincoats in a last-ditch effort to protect staff.

If the infection rate among frontline healthcare workers continues to rise, the government will face a serious morale problem that could exacerbate the crisis. The government is putting healthcare workers into hotels, ostensibly to keep them closer to hospitals, which will make them easier to monitor. The downside of that move is that it increases the risk of an outbreak among health workers.

Providing medical aid to Indonesia is something Australia would normally do, but it has its own shortages to contend with right now. Instead, Indonesia has been forced to accept offers from China and even to use its own military to pick up medical equipment. That’s a sign that Indonesia is already desperate for medical equipment, and suggests that the success of its response could depend on how much assistance it gets from China.

Indonesia’s options for averting crisis are limited. If lockdowns are implemented to reduce local transmission, enforcing them would be more than a question of manpower. The central government would be responsible for providing food to millions of Indonesians unable to provide for themselves. Food shortages could easily result in a breakdown of law and order and the scale would likely overwhelm security forces and weaken the government’s hold on power.

Like most countries, Indonesia’s priority has been to avert another economic crisis. The government has already injected around US$18 billion of liquidity into financial markets. Indonesia’s economy is consumer-driven, which has helped it weather previous financial crises. But a prolonged Covid-19 crisis will require substantial government spending and policy responses that bring the domestic economy to a standstill. Indonesia will need financial assistance and there will be few options apart from China.

Socioeconomic instability in Indonesia in the past has often been followed by political instability and change. Australia must therefore watch critical indicators closely—some of which Indonesia has already met—and provide medical aid and expertise as soon as possible before Indonesia becomes completely dependent on China to avert this crisis. Australia will have a limited capacity to provide the financial aid that Indonesia might require. But it can offset Indonesia’s dependence on poor-quality equipment from China, which has occurred in countries such as Spain and may actually prolong the crisis.

As soon as Australia has a handle on its own Covid-19 situation, it should start planning to assist Indonesia with expertise in workplace health and safety, diagnosis and treatment, all of which can be done at a distance. Otherwise, China will have a monopoly on influence and potentially take strategic advantage of Indonesia’s dire circumstances—an outcome that would have an adverse impact on Australia’s interests in the region.

The hierarchy of threats, risks and challenges in the South Pacific

Rank the threats, risks and challenges the South Pacific faces.

What’s most significant? What matters most in the lives of islanders?

Putting things in order of importance appeals to the orderly minds of public servants and the ordering minds of politicians. Journalists have always loved lists (even before clickbaiting became an art form). Ranking must look beyond headlines to define what really matters.

Using headlines, Canberra puts the China challenge on top. Certainly, the South Pacific is passionate about climate change. Both are in the top five, but neither is on top, in my list of the biggest threats, risks and challenges for the South Pacific:

1. Human security and state security

2. Climate change

3. Natural disasters

4. Natural resources

5. China

So, in reverse order …

5. China: Canberra judges that China wants to become the dominant strategic power in the islands, with military reach and bases to match. As I put it in 2018: ‘Australia today sees its strategic interests in the South Pacific directly challenged by China.’

Not since World War II and the Cold War have the islands been so strategically relevant—and that’s a view from the Pacific Islands Forum.

The region is waking to the China challenge. It’s manageable. It has to be, because China offers plenty of upside, as the Australian economy attests. China has economic reach but little soft power.

Canberra worries about China’s ability to buy island elites. As the switch of diplomatic recognition by Solomon Islands shows, Beijing can buy a government, but it’s harder to buy a people and a country.

Australia needs to have confidence in our shared history with the South Pacific—the breadth, the depth and the intricate, strong linkages. The islands know how to bargain; they’ve been dealing with the arrival of big powers for 250 years. China is being judged on its performance and it’s not winning everything.

4. Natural resources: A set of assets with lots of risks attached. The islands strive to protect and use their fishery resources. Today, tuna rates as a relative success story, while the tropical forests are a tragedy.

The dwindling, ravaged forests of Melanesia show what happens when extraction becomes exploitation, flavoured by corruption. Logging has been unsustainable and often illegal. Papua New Guinea and Solomon Islands are the biggest sources of tropical logs for China. Global Witness says log exports from the Solomons are more than 19 times a conservative estimate of the annual sustainable harvest.

Individual nations have done poorly on logging, compared to the collective action of the Pacific Islands Forum Fisheries Agency, which works to manage, monitor and control the distant-water fleets from China, Japan, South Korea and Taiwan.

Logging and fisheries offer lessons and cautions as the islands consider future prospects for exploiting seabed resources.

3. Natural disasters: The peoples of the South Pacific inhabit an environment that’s as harsh as it is beautiful. Island countries are among the most vulnerable in the world to natural disasters.

The 2019 World Risk Index lists four Pacific island countries among the top 10 most at-risk countries, with Vanuatu ranked first, Tonga third, Solomon Islands fourth, and Papua New Guinea sixth.

In addition to the force of nature, the index assesses government and society and the ability to respond to emergency: ‘The more fragile the infrastructure network, the greater the extent of extreme poverty and inequality and the worse the access to the public health system, the more susceptible a society is to natural events.’

2. Climate change: A huge threat, but a powerful unifier—something island leaders and their nations can all agree on.

The South Pacific has securitised climate change as its top security threat. In the words of the Pacific Islands Forum’s 2018 Boe declaration: ‘We reaffirm that climate change remains the single greatest threat to the livelihoods, security and wellbeing of the peoples of the Pacific and our commitment to progress the implementation of the Paris Agreement.’

The forum’s declaration last year was even louder on the threat to the survival of the Blue Pacific:

Right now, climate change and disasters are impacting all our countries. Our seas are rising, oceans are warming, and extreme events such as cyclones and typhoons, flooding, drought and king tides are frequently more intense, inflicting damage and destruction to our communities and ecosystems and putting the health of our peoples at risk.

Accepting the force of those statements, how is this only at number 2? The answer is to see the hierarchy in terms of power and responsibility.

Island leaders can unite and campaign on climate change because, as an old pop song puts it, they’re Not responsible.

Island leaders certainly aren’t responsible for global warming. Talking about the danger unites nations and puts leaders on the diplomatic offensive. Yet it’s a way for leaders not to talk about their core responsibility to deal with the greatest challenge facing the islands—the needs of their own people.

The ordering offered by the forum’s Boe declaration has a big ‘not responsible’ flavour. The first two points of the declaration are about climate change and the dynamic geopolitics of ‘an increasingly crowded and complex region’.

The third point in the Boe document is where the leaders step forward to claim ‘stewardship’ of the Blue Pacific. Not until point 7 of the declaration does an expanded concept of security arrive. Even then, human security is discussed in terms of outside ‘humanitarian assistance, to protect the rights, health and prosperity of Pacific people’. It’s an indirect way to discuss the biggest threat, which is also the major responsibility.

1. Human security and state security: In all its forms—social, health, economic and political—the security of the islands and their peoples is merging into traditional security threats.

The islands are strong societies with weak governments. The societies stretch and strain while the governments get no stronger.

The traditional stabilisers of village, clan and religion are shaken. The challenges of modernisation come from outside and inside.

It’s flip, but more than alliteration, to say South Pacific cities are as challenged by sewerage as they are by sea level. The ocean tide coming in matches the tide of those leaving the villages for Pacific towns and cities. The islands grapple with urbanisation.

Health problems abound. Colin Tukuitonga—a doctor from Nuie who was head of the Pacific Community from 2014 until recently—says the climate crisis is matched by the health crisis:

Noncommunicable diseases such as diabetes and heart disease cause three out of four deaths in the Pacific. These conditions are fuelled by a pipeline of risk factors such as high levels of smoking, unhealthy diets and reduced levels of physical activity. These conditions cause considerable personal costs such as blindness and kidney and heart failure.

In the South Pacific country most important to Australia, Papua New Guinea, Covid-19 adds to PNG’s economic, fiscal and social crisis.

The islands have the youth bulge that brings revolutions. Australia worries quietly about a breakdown of state legitimacy and capacity among the neighbours.

Thinking about likely flashpoints in the manner of the Oz military, John Blaxland offers a crisis scorecard for the coming decade, with 10 being the highest probability. Bougainville’s quest for independence from PNG is an 8. The prospect of a breakdown in law and order in the island arc, as happened in Timor-Leste and Tonga in 2006, and repeatedly in Solomon Islands in the last two decades, is also an 8.

The threat hierarchy lines up the problems and then poses stark questions about need and responsibility.

China’s misplaced pandemic propaganda

Barely a month ago, China was in the grip of the coronavirus. Thousands of new infections were confirmed every day. Hospitals were overwhelmed. People were dying by the hundreds. People couldn’t leave their homes. But the government’s draconian lockdown seems to have worked: the outbreak now seems to be under control. And, apparently, China’s leaders have ignored its most essential lessons.

To see this, it’s worth reviewing how they handled the crisis. Upon hearing that a new coronavirus had emerged in Wuhan in the Hubei province, local authorities’ first instinct was to suppress the information. Police reprimanded whistleblowers like the Wuhan-based doctor Li Wenliang, who subsequently died of the disease. (Wuhan police recently apologised to Li’s family.)

This should have motivated China’s leaders to weigh the costs of censorship and reconsider the appointment of unqualified Chinese Communist Party members to key public health positions. The head of the Hubei Provincial Health Commission, dismissed during the crisis, had no medical training or experience in the health sector.

Moreover, some other countries, especially Singapore and Taiwan, managed to contain the Covid-19 outbreak without incurring the high costs that China did when it placed at least 760 million people under varying degrees of residential lockdown. China’s leaders should be looking to these countries for lessons on smarter crisis response.

But, far from learning from past mistakes, China’s leaders are trying to cover them up. As virtually the entire global economy effectively shuts down to contain the China-born virus, and deaths in Italy—the pandemic’s new epicentre—exceed 8,000, the CCP has shifted its propaganda machine into high gear. Its goal? Change the narrative of the Covid-19 crisis.

At home, this has meant touting the CCP’s leadership in mobilising the country to ‘win the war’ against the virus. It has also meant encouraging the spread on Chinese social media of exaggerated or outright false stories about Western democracies’ ‘inept’ responses to the outbreak.

Abroad, China’s propaganda machine is trumpeting declining infection rates as evidence that strong centralised leadership is more effective than democratic governance. Meanwhile, the government is sending humanitarian assistance—including healthcare workers and medical supplies—to hard-hit countries like Iran, Italy and the Philippines.

But if Chinese leaders hope to use the Covid-19 pandemic to build and project soft power, they are likely to be sorely disappointed. For starters, the world is nowhere near ready to forget the role that its initial cover-up played in allowing the virus to spread.

The prevailing view outside China is that, had the country’s leaders taken decisive action immediately and transparently, the current pandemic may have been avoided. The CCP can challenge that narrative all it wants, but it cannot force international media to do the same. Chinese propaganda has never gotten much purchase in the free marketplace of ideas; indeed, most of the CCP’s previous attempts to influence international public opinion have fallen flat.

Few are tempted by a Chinese-style containment strategy. Shutting down the entire country has cost China dearly in economic terms. First-quarter GDP is expected to plunge 9%. Should a second wave of infections strike, as is likely, repeating the same strategy would lead to economic ruin.

Of course, if this were the only way to save lives, people might be on board. But Hong Kong, Singapore and Taiwan all seem to have struck a better balance between protecting public health and sustaining economic activity.

Against this background, China’s humanitarian efforts will do little to repair its reputation. Yes, it is better than offering no help at all. But the country could do a lot more to bolster public health globally—beginning with sharing the massive amounts of data and knowledge it has gathered on the virus.

China could also scale up the production of protective equipment, especially hazmat suits and surgical masks. China made half the world’s surgical masks before the Covid-19 outbreak, and it has since expanded production nearly 12-fold. If it really does have the virus under control, there is nothing stopping it from donating this life-saving equipment to countries facing severe shortages.

In particular, China should make a major donation—say, one billion surgical masks and one million hazmat suits (10 days of supply for 50,000 healthcare workers)—to the United States. This could ease tensions between the two countries just enough to enable them—together with the European Union and Japan—to pursue a coordinated response to the pandemic, including action to shore up the global financial system and enact major stimulus packages to stave off a depression.

When this pandemic is finally over, people will remember what China did, not what it said. It can go down in history either as the reason the Covid-19 crisis began, or as one of the reasons it ended.

PNG already faces an economic, fiscal and social crisis—and coronavirus is still to come

Papua New Guinea faces its most critical economic, fiscal and social crisis since independence in 1975. This dangerous mix is largely unrelated to the coronavirus sweeping the world, despite attempts by some PNG leaders to claim otherwise.

PNG so far has just one confirmed case of Covid-19. But when the virus takes hold there, as it surely will, it will have a massive and tragic impact on the nation’s 10 million people.

The health system in PNG is wholly incapable of addressing a major upsurge in any illness or disease, let alone Covid-19. It has already started affecting tourism, travel and the nation’s airlines, but so far the impact remains comparatively minor. That will change quickly as the virus escalates.

It’s disappointing that leaders who have generally been upfront about the extent of the nation’s economic problems are now trying to shift the responsibility away from poor policies and unsatisfactory fiscal management that long predate the virus outbreak.

The real danger in this approach, which won’t fool thinking people in PNG, is that the virus may be used as an excuse for the tough decisions that their leaders can no longer avoid addressing. The people will doubtless be told the nation will recover from the impact of the virus, but those in charge may ignore or downplay the economic and fiscal challenges and their likely consequences.

The level of government debt is approaching 40% of GDP. The 2020 budget is clearly in serious difficulty, even after a substantial projected deficit is funded (if it can be funded). The economy is in decline and the government can’t evade its share of the responsibility for that.

Investment and confidence in the mining and oil and gas sectors have never been worse. The Papua LNG Project is effectively on hold. The Wafi Mine is in a similar position, and even the Ramu Nickel Mine expansion is off. The collapse in resource-sector-related construction is not only affecting employment and business, but also putting real pressure on foreign reserves and government revenue.

The government is understood to be in detailed negotiations with the International Monetary Fund and the Asian Development Bank on a budget support and debt management program reportedly worth around A$2 billion.

That will mean accepting tough IMF and ADB conditions.

These are certain to include a devaluation of the PNG kina, which has been propped up by the central bank. Any devaluation will boost exporters in the mining, oil and gas, and agricultural sectors. But it will force up the cost of imports that PNG remains too dependent on, such as rice and fresh milk, as well as consumer appliances and vehicles.

The IMF and ADB will undoubtedly demand massive cuts in public spending, especially recurrent spending on salaries and wages and related bureaucratic costs.

That will all be very tough medicine for Prime Minister James Marape and his government to have to swallow just two years out from the next national elections.

The real danger is that the government will try to bail itself out by another route—a massive debt management loan from the People’s Republic of China. The impact of the coronavirus on China’s economy might mitigate against that, but it’s still not off the agenda.

Soon after his election,  Marape was in discussions with the Chinese embassy in Port Moresby about a total debt restructuring funded by China.

Last November, Australia’s urgent loan of $440 million helped finance the 2020 budget. It replaced a similar loan being negotiated with China.

What Australia must not do now is allow the PNG government to drive it into a bidding war with China to bail out the economy.

The most effective way to avoid that happening is to use our influence with both the IMF and the ADB to ensure that whatever package is agreed on is not dominated by funding, and control, from China.

The ADB has a generally good record in PNG, influenced largely by Japan, South Korea and Australia. But China is clearly playing a greater role in the bank, and of course in the IMF.

Just weeks ago, the contract for a major upgrade of the Kavieng airport in New Ireland province was awarded to the China Railway Construction Company, the latest example of the massive presence of Chinese-state-owned entities across PNG.

There may be limited support among Australians for increased aid, especially if it comes in the form of budget and debt bailouts rather than direct assistance to address health, poverty and education challenges. And we have to expect that Pacific island countries that are less resource rich, and more dependent on tourism, such as Fiji and Vanuatu, will seek Australia’s help in the coming months.

It’s overwhelmingly in Australia’s interest to help PNG and the South Pacific deal with the consequences of the coronavirus as it spreads. But we need to keep a very close eye on our neighbour’s growing economic and fiscal crisis. And we must ensure that Beijing isn’t allowed to broaden and strengthen its already extensive hold on key sectors of the PNG economy through a desperate arrangement that would not be in the interests of the people of PNG.

Chinese diplomats and Western fringe media outlets push the same coronavirus conspiracies

Against the backdrop of an escalating war of words between Washington and Beijing, and the Chinese Communist Party’s broader campaign to rewrite the history of the Covid-19 outbreak, the attempts by multiple Chinese diplomats to promote conspiracy theories that the virus originated in the US, not China have received widespread attention.

What has been less discussed, however, is how Western fringe and conspiracy media have been supporting these efforts and what the growing nexus between pro-CCP propaganda and conspiracy narratives may tell us about the role China is coming to play in the Western information ecosystem.

There has long been a symbiotic relationship between Russian state propaganda outlets like Sputnik and RT and certain elements of the fringe and conspiracy media in the West. They frequently echo, borrow or seed narratives from one another. In most cases, it’s probably not deliberate collusion (at least, not on a large scale), but rather the result of opportunism and mutual benefits in singing from the same hymn sheet. And now, it appears, China may be joining the chorus.

In perhaps the most notable example of this, on 13 March a spokesperson for China’s Ministry of Foreign Affairs, Zhao Lijian, used his Twitter account to promote an article from the website globalresearch.ca, titled ‘COVID-19: Further evidence that the virus originated in the US’. The article outlines a conspiracy which claims that the novel coronavirus originated in the US, and that ‘it may therefore be true that the original source of the COVID-19 virus was the US military bio-warfare lab at Fort Detrick’.

To be clear: there is no evidence to support this claim, or to suggest that the virus originated anywhere outside China. Nonetheless, Zhao’s tweets have not only remained up but have been re-tweeted by numerous other Chinese diplomatic accounts. At the time of writing, Zhao’s tweet had received over 20,000 likes and been shared 12,700 times.

Among the many interesting issues this raises, one is the choice to promote that particular article from that particular site. There’s no shortage of conspiracy theories on the internet—so why that one?

The Centre for Research on Globalization, also known as Global Researchis a website run by Canadian economist and conspiracy theorist Michel Chossudovksy that has repeatedly been accused of being a pro-Kremlin mouthpiece. It’s not clear how deep the links between the site and Russian state-linked media run, but according to the independent Russian newspaper Meduza:

What makes GlobalResearch.ca different from other similar websites is the disproportional weight it enjoys in news coverage by the Russian state media. Global Research is prominently featured as the only source in numerous stories by Russia’s leading newswire RIA Novosti, where it’s referred to as a ‘think tank’ or ‘publication’ whose ‘experts’ or ‘journalists’ regularly reveal or uncover some fact that fits into the Kremlin’s current foreign policy agenda …  [I]t is less a news outlet and more an amateur conspiracy website whose founder has subscribed to the Kremlin’s narrative simply because it opposes the one promoted by the ‘deep state’ and its subservient ‘mainstream media’.

Sites like Global Research are valuable to state-linked actors because they put a Western, pseudo-academic face on conspiracy theories and disinformation narratives. They are useful tinder to spark entire narrative cycles, as this example clearly highlights.

In the early days of the Covid-19 crisis, Global Research seems to have sensed an opportunity to reach out to new audiences. Indeed, the pivot to a Chinese audience appears to have been so hasty that no one has yet fixed the typo in ‘Chinese’ on the site’s About page (figure 1).

Figure 1: Screenshot of Global Research’s ‘About’ page, 24 March 2020

Only two articles had actually been translated into Chinese before Zhao picked up Global Research’s English-language piece promoting the US-origin conspiracy theory. Zhao’s tweet was used as the basis for news stories in Chinese state media, including the Global Times and People’s Daily Online.

It also appears to have driven a huge surge in searches for ‘globalresearch.ca’ on 13 March, the day Zhao’s tweet went out (figure 2). What this demonstrates is that the quid pro quo—the benefit (or at least one of the benefits)—for sites like Global Research in aligning themselves with state-linked conspiracies is the enormous amplification which state-linked voices can give to pieces like this that would otherwise receive very little traffic.

Figure 2: Google search trends for ‘globalresearch.ca’

Zhao’s amplification is likely to have been multiplied many times over by the widespread media coverage of his tweets, which in turn will have driven still more traffic to the Global Research site. Not only does this help to propagate the conspiracy theory, it also provides Global Research with an incentive to lean in to the narrative. In the 10 days since Zhao’s tweet, the site has published multiple additional articles (including republishing one from CGTN) on the US-origin conspiracy theory, some citing Zhao’s tweets.

This mutually beneficial ouroboros of conspiracy narratives passing back and forth between state-linked and fringe media already exists in the context of Kremlin-backed outlets. If this example is anything to go by, we may well see Beijing’s state-linked information efforts follow a similar path, as China becomes a more active and aggressive player in the Western information ecosystem.

How the coronavirus crisis was made in China

The new coronavirus, Covid-19, has spread to more than 130 countries—bringing social disruption, economic damage, sickness and death—largely because authorities in China, where it emerged, initially suppressed information about it. And yet China is now acting as if its decision not to limit exports of active pharmaceutical ingredients and medical supplies—of which it is the dominant global supplier—was a principled and generous act worthy of the world’s gratitude.

When the first clinical evidence of a deadly new virus emerged in Wuhan, Chinese authorities failed to warn the public for weeks and harassed, reprimanded and detained those who did. This approach is no surprise: China has a long history of shooting the messenger. Its leaders covered up severe acute respiratory syndrome, another coronavirus, for over a month after it emerged in 2002, and held the doctor who blew the whistle in military custody for 45 days. SARS ultimately affected more than 8,000 people in 26 countries.

This time around, the Chinese Communist Party’s proclivity for secrecy was reinforced by President Xi Jinping’s eagerness to be perceived as an in-control strongman, backed by a fortified CCP. But, as with the SARS epidemic, China’s leaders could keep it under wraps for only so long. Once Wuhan-linked Covid-19 cases were detected in Thailand and South Korea, they had little choice but to acknowledge the epidemic.

About two weeks after Xi rejected scientists’ recommendation to declare a state of emergency, the government announced heavy-handed containment measures, including putting millions in lockdown. But it was too late. Many thousands of Chinese were already infected with Covid-19, and the virus was rapidly spreading internationally. US National Security Adviser Robert O’Brien has said that China’s initial cover-up ‘probably cost the world community two months to respond’, exacerbating the global outbreak.

Beyond the escalating global health emergency, which has already killed thousands, the pandemic has disrupted normal trade and travel, forced many school closures, roiled the international financial system and sunk global stock markets. With oil prices plunging, a global recession appears imminent.

None of this would have happened China had responded quickly to evidence of the deadly new virus by warning the public and implementing containment measures. Indeed, Taiwan and Vietnam have shown the difference a proactive response can make.

Taiwan, learning from its experience with SARS, instituted preventive measures, including flight inspections, before China’s leaders had even acknowledged the outbreak. Likewise, Vietnam quickly halted flights from China and closed all schools. Both responses recognised the need for transparency, including updates on the number and location of infections, and public advisories on how to guard against Covid-19.

Thanks to their governments’ policies, both Taiwan and Vietnam—which normally receive huge numbers of travellers from China daily—have kept total cases to fewer than 60. Neighbours that were slower to implement similar measures, such as Japan and South Korea, have been hit much harder.

If any other country had triggered such a far-reaching, deadly, and above all preventable crisis, it would now be a global pariah. But China, with its tremendous economic clout, has largely escaped censure. Nonetheless, it will take considerable effort for Xi’s regime to restore its standing at home and abroad.

Perhaps that’s why China’s leaders are publicly congratulating themselves for not limiting exports of medical supplies and active ingredients used to make medicines, vitamins and vaccines. If China decided to ban such exports to the United States, the state-run news agency Xinhua recently noted, the US would be ‘plunged into a mighty sea of coronavirus’. China, the article implies, would be justified in taking such a step. It would simply be retaliating against ‘unkind’ US measures taken after Covid-19’s emergence, such as restricting entry to the US by Chinese and foreigners who had visited China. Isn’t the world lucky that China is not that petty?

Maybe so. But that is no reason to trust that China won’t be petty in the future. After all, China’s leaders have a record of halting other strategic exports (such as rare-earth minerals) to punish countries that have defied them.

Moreover, this is not the first time China has considered weaponising its dominance in global medical supplies and ingredients. Last year, Li Daokui, a prominent Chinese economist, suggested curtailing Chinese exports of active pharmaceutical ingredients to the US as a countermeasure in the trade war. ‘Once the export is reduced’, Li noted, ‘the medical systems of some developed countries will not work’.

That is no exaggeration. A US Department of Commerce study found that 97% of all antibiotics sold in the US come from China. ‘If you’re the Chinese and you want to really just destroy us’, Gary Cohn, former chief economic adviser to US President Donald Trump, observed last year, ‘just stop sending us antibiotics’.

If the spectre of China exploiting its pharmaceutical clout for strategic ends were not enough to make the world rethink its cost-cutting outsourcing decisions, the unintended disruption of global supply chains by Covid-19 should be. In fact, China has had no choice but to fall behind in producing and exporting pharmaceutical ingredients since the outbreak—a development that has constrained global supply and driven up the prices of vital medicines.

That has already forced India, the world’s leading supplier of generic drugs, to restrict its own exports of some commonly used medicines. Almost 70% of the active ingredients for medicines made in India come from China. If China’s pharmaceutical plants don’t return to full capacity soon, severe global medicine shortages will become likely.

The Covid-19 pandemic has highlighted the costs of Xi’s increasing authoritarianism. It should be a wake-up call for political and business leaders who have accepted China’s lengthening shadow over global supply chains for far too long. Only by loosening China’s grip on global supply networks—beginning with the pharmaceutical sector—can the world be kept safe from the country’s political pathologies.

From the bookshelf: ‘China’s Asia: triangular dynamics since the Cold War’

Lowell Dittmer’s book on the strategic geometry of power relationships in Asia comes at a critical time when regional actors are facing the urgent challenge of shaping their responses to China’s rising power and influence. According to Dittmer, China is seeking to revive the old China dream of having dominance over what it considers its ‘natural region’. However, the region has been resisting such attempts, and ‘China finds its way to its prized Asian leadership role frustrated’. The book takes on an ambitious goal of examining how Asian countries are coping with a rising and assertive China.

Dittmer suggests that the best way of understanding the dynamics of China and its neighbours is by mapping them onto a triangular model of relationship involving the United States as the third actor. This creates, what Dittmer calls a ‘strategic triangle’, in which each participant is presumed to be a sovereign and rational actor. Each actor in a strategic triangle takes into account the third actor in managing its relationship with the second. Each actor is also essential to the game in the sense that its defection from one side to the other would affect the strategic balance. For Dittmer, ‘The rules of the game are to maximize national interests by having as many positive triangles and as few negative triangles as possible.’

With the inclusion of the US in the strategic triangle, China’s asymmetrical power advantage over its Asian neighbours is mitigated, much to Beijing’s chagrin. This explains why China seeks to depict the US as ‘a country outside of the region’ and cast its foreign policy in the region as ‘interference’ or ‘intervention’. China also warns its smaller neighbours to ‘not take sides’ between the two major powers.

The book examines six strategic triangles involving combinations of China, the US, Russia, Japan, South Korea, Taiwan, ASEAN states, India and Australia (he also posits two smaller embedded triangles involving Pakistan).

According to Dittmer, the Russia–China–US triangle poses the worst possible configuration for America. The Sino-Russian partnership has been growing stronger, placing the US in a disadvantageous position. Dittmer describes how President Barack Obama made a strategic choice to engage China, even ‘downplaying short-term disagreements over the South China Sea’. However, under President Donald Trump, US relations with China and Russia have deteriorated, while Beijing and Moscow have grown closer, putting the US in the worse triangular position.

Dittmer describes the Japan–China–US triangle as an arranged marriage ‘consisting of the Japan–America Security Alliance on one side facing an opposing Sino-Russian alliance on the other’. Increasingly, however, as China’s influence has grown, the China–Japan–US triangle has further entrenched the importance of Japan and the Japan–US alliance.

Dittmer assesses that, in their respective strategic triangles with the US and China, Taiwan and South Korea, both experiencing separation, pursue schizoid foreign policies in the sense of being oriented both to outside powers and to the ‘other half’. Both countries have tried (inconclusively) to bring their policies into ‘alignment’.

Between 1995 and 2005, ‘Taiwan fell into the worst possible position of a pariah facing a Sino-US marriage’. However, given current US–China tensions, Taiwan’s prominence has now risen in American foreign policy. Dittmer thus argues that ‘we may stand at the threshold of a brave, perilous new era in cross-Straits relations’.

While China has repeatedly sought to assure others in the region that is has no intention of pushing the US out of the Western Pacific, it considers the US alliance network in the region and the Taiwan Relations Act to be antithetical to some of its core interests. The triangles involving Taiwan and South Korea serve a different purpose than other triangular configurations. While these relationships may provide some measure of protection to smaller powers, Dittmer argues that they ‘cannot heal national division’ that afflicts both South Korea and Taiwan.

With respect to Southeast Asia, Dittmer represents ASEAN as a monolith that occupies one leg of the triangle. This is a drawback since ASEAN lacks coherent strategic interests at the institutional level. Dittmer outlines the transformation of the grouping since the end of the Cold War. During the Cold War, the five-member ASEAN was aligned with the US in an effort to counter communism in the region. Dittmer notes that today’s ASEAN, with 10 member states, is a more neutral actor that could benefit from the increasingly competitive relationship between the two other legs of this particular triangle, the US and China.

Separate chapters on South Asia and Australia are provided, but unfortunately bring more confusion than clarity. There are a number of ‘smaller triangles’ embedded in the larger India–China–US triangle, but the brevity of the book fails to give them justice. Similarly, Australia, while enjoying its own chapter—unlike the countries of South and Southeast Asia, which are grouped together—and arguably the most straightforward triangle, is presented as much more coherent than its domestic debates and decisions may suggest.

Beyond the real cases and the role that these strategic triangles play in mitigating China’s growing power, a question remains as to whether the power transition in Asia will lead to war. Dittmer suggests three conditions that need to be met to ensure a peaceful power transition. First, the challenger should not attack the incumbent’s core interests. Second, the incumbent must gracefully yield to the challenger’s reasonable demands. Third, they both must share a determination not to let their differences become kinetic.

Dittmer’s book is a commendable attempt to capture the complex and rapidly evolving sets of relationships involving China, the United States and major Asian countries. However, some readers may be dissatisfied with some of the author’s oversimplifications. Dittmer, however, defends this approach because ‘simplifications can sometimes be useful’.

Will the coronavirus topple China’s one-party regime?

It may seem preposterous to suggest that the outbreak of the new coronavirus, Covid-19, has imperilled the rule of the Chinese Communist Party, especially at a time when the government’s aggressive containment efforts seem to be working. But it would be a mistake to underestimate the political implications of China’s biggest public health crisis in recent history.

According to a New York Times analysis, at least 760 million Chinese, or more than half the country’s population, are under varying degrees of residential lockdown. This has had serious individual and aggregate consequences, from a young boy remaining home alone for days after witnessing his grandfather’s death to a significant economic slowdown. But it seems to have contributed to a dramatic fall in new infections outside Wuhan, where the outbreak began, to low single digits.

Even as China’s leaders tout their progress in containing the virus, they are showing signs of stress. Like elites in other autocracies, they feel the most politically vulnerable during crises. They know that, when popular fear and frustration is elevated, even minor missteps could cost them dearly and lead to severe challenges to their power.

And ‘frustration’ is putting it mildly. The Chinese public is well and truly outraged over the authorities’ early efforts to suppress information about the new virus, including the fact that it can be transmitted among humans. Nowhere was this more apparent than in the uproar over the 7 February announcement that the Wuhan-based doctor Li Wenliang, whom the local authorities accused of ‘rumour-mongering’ when he attempted to warn his colleagues about the coronavirus back in December, had died of it.

With China’s censorship apparatus temporarily weakened—probably because censors hadn’t received clear instructions on how to handle such stories—even official newspapers printed the news of Li’s death on their front pages. And business leaders, a typically apolitical group, have denounced the conduct of the Wuhan authorities and demanded accountability.

There is no doubt that the authorities’ initial mishandling of the outbreak is what enabled it to spread so widely, with healthcare professionals—more than 3,000 of whom have been infected so far—being hit particularly hard. And despite the central government’s attempts to scapegoat local authorities—many health officials in Hubei province have been fired—there are likely to be more questions about what Chinese President Xi Jinping knew.

Not surprisingly, Xi has been working hard to repair his image as a strong and competent leader. After the central government ordered the lockdown of Wuhan in late January, Xi appointed Premier Li Keqiang to lead the coronavirus taskforce. But the fact that it was Li, not Xi, who went to Wuhan seemed to send the wrong message, as Xi realised in the subsequent days.

On 3 February, at a Politburo Standing Committee meeting, Xi took an unusually defensive tone in a speech that smacked of damage control. While Xi admitted that he had learned of the outbreak before he sounded the alarm, he emphasised his personal role in leading the fight against the virus.

On 10 February, Xi made a series of public appearances in Beijing, aimed at reinforcing the impression that he is firmly in command. Three days later, he sacked the party chiefs of Hubei province and Wuhan municipality for their inadequate handling of the crisis. And two days after that, in an unprecedented move, the CCP released the full text of Xi’s internal Politburo Standing Committee speech.

Though Xi has apparently regained his aura as a dominant leader—not least thanks to CCP propagandists, who are working overtime to restore his image—the political fallout is likely to be serious. The profound uproar that marked those fleeting moments of relative cyber freedom—the two weeks, from late January through early February, when censors lost their grip on the popular narrative—should be deeply worrying to the party.

Indeed, the CCP may be highly adept at repressing dissent, but repression is not eradication. Even a momentary lapse can unleash bottled-up anti-regime sentiment. But what might happen to the party’s hold on power if Chinese were able to speak freely for a few months, not just a couple of weeks?

The most consequential political upshot of the Covid-19 outbreak may well be the erosion of support for the CCP among China’s urban middle class. Not only have their lives been severely disrupted by the epidemic and response, but they have been made acutely aware of just how helpless they are under a regime that prizes secrecy and its own power over public health and welfare.

In the post–Mao Zedong era, the Chinese people and the CCP have adhered to an implicit social contract: the people tolerate the party’s political monopoly, as long as the party delivers sufficient economic progress and adequate governance. The CCP’s poor handling of the Covid-19 outbreak threatens this tacit pact. In this sense, China’s one-party regime may well be in a more precarious position than it realises.

ASPI’s China research: the big picture

In a piece titled ‘The think-tank behind Australia’s changing view of China’, the Australian Financial Review recently gave prominence to a few critics of ASPI’s China research. But instead of engaging with the research and its findings, the criticisms levelled were simple jibes: ‘one-sided’, ‘dystopian’, ‘brings shame to Australia’. That was a pity because ASPI’s China research is addressing head-on one of the most important challenges Australia faces.

For a long time there was a cosy consensus in Australian policymaking circles about how China would rise. It was assumed China would join the international system that had underpinned its economic success and participate in it, largely as a status quo power. As has now become very clear under President Xi Jinping, sadly, that assessment was wrong.

What has been remarkable about this major failure is the desire expressed by some to continue along the same path we were on before.

At the heart of Australia’s failure to accurately predict how China would rise was a failure to understand China under the control of the Chinese Communist Party. Across the Australian policymaking community, Australian think tanks and academia, the number of people with deep expertise on China were few and far between.

While lots of effort was thrown into understanding the Chinese economy, other critical areas were ignored and are still not well understood, such as technology transfer programs, united front activities, military modernisation and interference in diaspora communities. It can be difficult to talk about these more negative and challenging aspects of China’s rise, but, given how important China will be for Australia and the international system, it would be foolish to gloss over or ignore them.

Against this policy gap, what better way to understand China than by looking at what the Chinese government is saying it wants to do? ASPI’s researchers read Chinese-language documents and have the expertise to assess Chinese technology, political and military developments including through the lens of Chinese Australians who can draw analytical depth from understanding both societies.

That objective to clearly understand China is precisely why we set up a China research capability at ASPI. To bring empirical data to one of the most consequential policy debates that will engage the current generation of Australian decision-makers. ASPI has one of the largest concentrations of Chinese-language speakers in any think tank in the country. Their specialisations include China’s military, technology transfer, online censorship, smart cities, social credit and industrial espionage. Our China research runs across different thematic programs and, while it attracts attention, is still only a modest part of ASPI’s total research output.

The simple act of looking at what the Chinese government says it wants to do and is doing has produced some remarkable empirical research and insights into the type of state that Australia, and the world, is dealing with.

Our work analysing Chinese defence universities and Western academics’ support for Chinese weapons programs has raised important questions both here and overseas. This includes questions about the extent to which Australian taxpayer funding and university research should be used to build up an authoritarian state’s military capabilities and measures we might need to take to prevent collaborations on defence-related technologies. Research engagement with China is vital to the Australian university sector, but a small proportion of partnerships are problematic and threaten the integrity of some universities and academic freedom more broadly.

Our research on the Chinese state’s efforts to control and manipulate global debate on key issues has raised equally important questions about free speech, the integrity of democratic institutions and the privacy of people’s data. And our work on the global expansion of China’s technology giants has provided a massive dataset to help policymakers everywhere understand how Chinese companies that will be powerful players in critical new technologies like artificial intelligence differ from the private companies they are used to dealing with because of their links to the CCP, the laws they are obliged to comply with and their attitudes towards human rights abuses.

Of course, ASPI has no monopoly on the ability to trawl through CCP policy documents and statements to unearth new insights and shed light on the party’s stated plans for China and the rest of the world. It’s just that so few others in Australia and elsewhere invest significant time to do so.

ASPI doesn’t have an editorial line on China, but we have a very clear method for how we go about our research. What we focus on—no matter the country or theme—is original empirical research that, wherever possible, generates new data that can help inform better public policy. That requires researchers to trawl through masses of information in multiple languages over months and sometimes years in order to create new datasets to inform their analysis.

This focus on empirical research is grounded in the idea that analysis informed by the hard work of empirical research is the most valuable contribution we can make to the policy debate. People don’t have to agree with our analysis, but it at least provides a factual basis for a debate.

While I’m very glad ASPI’s research has its critics (how else could we have a debate?), a better outcome for Australia would be to debate the issues we face. There is no more urgent or important policy issue for Australia than to think through how to engage China. The more that debate is informed by data and clear-sighted analysis, the better.

Coronavirus shock will cascade through the Indo-Pacific region

The Covid-19 crisis heralds a decade of strategic volatility.

Now that the virus has emerged from China, societies, governments and international institutions must brace for contagion of all kinds—health, environmental, financial, cyber and the risk of conflict. The intense connectivity that has facilitated flows of trade, investment, resources, information and, above all, people now judders with vulnerability.

This international health emergency is a black swan event, an improbable catastrophe obvious in retrospect. It’s perhaps better termed a black elephant: a discontinuity so big and so inevitable that nations and corporations chose not to see it coming.

The crisis will shake up our Indo-Pacific region. The rapid evolution of this two-ocean strategic system and its accumulation of risk is the subject of my new book, Contest for the Indo-Pacific: why China won’t map the future (soon also to be released internationally as Indo-Pacific empire: China, America and the contest for the world’s pivotal region).

Any book making claims about this uncertain decade is a gift to fate. Mine went to print at the start of January, when knowledge of the true nature of the coronavirus outbreak in Wuhan was so suppressed it may not have reached even the Chinese leadership.

This book is not so much about today’s problems as about how the reinterpreted past and plausible projections of the future can illuminate policy choices in the present. Current events amplify its main contentions.

We need to transcend the false binary that the Indo-Pacific dynamic is purely a contest between China and America. The Indo-Pacific has long been a place of multipolar connectivity and contestation, a melting pot of many entrepôts, where risk of all kinds ignores imagined boundaries.

The book revisits the deep history of maritime Asia to underscore that this has never been a China-centric region. The Indo-Pacific is too vast for hegemony, and this empowers middle players such as Australia, Japan, Indonesia and India with more agency than they once appreciated.

Addressing the threats to health and social order is the priority, but governments must also anticipate cascading shocks to the balance of power among nations, and the credibility and legitimacy of governments to their own populations.

Translating human anxiety and suffering into the lexicon of geopolitical competition, threat and, it has to be said, strategic opportunity is a delicate matter.

The outbreak has caused lasting damage to the People’s Republic of China, which was already weaker than it liked to look.

The shock is rattling China’s economy, exposing the fragility of the strategic weight that has intimidated so many other countries in recent years. Even as China’s navy, air force, fishing fleets and paramilitary coastguards extend their Indo-Pacific push, new data reflects an extraordinary decline in commercial shipping to and from Chinese ports.

Companies are desperately reconsidering supply chains. Diversification is now necessity, not just strategic aspiration. Suddenly the logic of many belts and many roads is plain.

Domestically, the disaster is shaking confidence in Xi Jinping’s leadership, and in the competence and intent of the Chinese Communist Party.

This is a deeply human tragedy, and the sacrifice and stoicism of medical professionals and ordinary people in China, and now many other infection zones, is to be admired. So too was the willingness of citizens like the late Dr Li Wenliang to risk everything in the name of truth, trying to provide early warning to each other, the authorities and the world. Covid-19 is a reminder that China will struggle to maintain the internal obedience and international sway it needs for its Indo-Pacific strategic ambitions.

Internationally, China’s response hurts its image as a robust partner in tackling shared threats, a stark signal for countries that had blithely tied their fortunes to Xi’s strategy for geoeconomic influence. Beijing has long encouraged narratives that the Belt and Road Initiative will bring health benefits, among many other gifts.

Suddenly, from Iran to Italy and beyond, China’s expanding power and influence looks much more double-edged, as Parag Khanna, author of The future is Asian, has been among the first to acknowledge, in a confronting article noting the parallel Silk Road transmission belts for coronavirus and the 14th-century plague.

Covid-19 arrived in a time of deep mistrust and rivalry.

China’s new normal has been to proclaim a relentless rise, asserting its interests against others, from the South China Sea to cyberspace. Its repression and censorship have become both tools and terrain of struggle against democratic nations and Chinese dissidents alike. It’s becoming clear that such truth suppression sabotaged the response to a local epidemic, with worldwide repercussions.

Now we see the party-state stumble, in need of help, pivoting to protect itself and the world from a common threat.

Of course, the other big powers in the Indo-Pacific have their own maladies. The United States is desensitised to political trauma within, struggles to convince allies the great republic doesn’t mean what the president says, and is yet to define a true strategy for competing with China in a post-primacy future. We must await another bad dream election to grasp how, when and whether America’s still-colossal power will adapt.

Normally a summit of the world’s two largest democracies would be a rallying point for world order and liberal values. Not so President Donald Trump’s visit to India, though it did affirm that a China-wary India no longer hesitates to embrace American power.

India, for all its youth and diversity and promise, is in conflict with itself. Mobs extolling Hindu extremism brought carnage to the streets to Delhi, at the very least on Prime Minister Narendra Modi’s watch.

It will become incredible, literally, to build international partnerships of mutual respect and rules-based stability—principles underscoring the Indo-Pacific solidarity of India, America, Australia, Japan, Indonesia and others—if those values are not guarded at home.

China’s woes are no time for democratic self-satisfaction.

Powers like Australia must demonstrate a creative mix of resilience and partnership with diverse nations in a multipolar Indo-Pacific including, on some issues, China. The early activation of pandemic response is a smart example of independent Australian foreign policy: swayed by neither America nor China, or by hesitant and compromised international institutions.

Australia has exercised global leadership, grounded in national interest and values, on other shared challenges such as in deciding to ensure the security of telecommunications and internet-of-everything infrastructure.

Australia should do all it can to help other nations: if pandemic preparedness were not part of its development-and-security pivot to help South Pacific neighbours, it now urgently should be.

There’s sadly little sign yet that the common threat of contagion risk in health, environment, finance, cyber or other security matters is reducing strategic rivalry. For the middle players that want strategic competition to be managed in ways short of conflict, now’s the time to emphasise coexistence and cooperation based on shared interests, mutual respect and honest communication.

In 1348, after the plague reached England and France amid their Hundred Years’ War, there ensued effectively a seven-year truce. Exhaustion, depopulation and quarantine drove this peace, more than any enlightened statecraft. Still, it’s a reminder that a profoundly human crisis is a chance for nations to reorder their priorities and how they define their interests.

It shouldn’t be beyond the wit of 21st-century diplomacy to draw from coronavirus at least something of a vaccine against other strategic shocks.