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China's Dream

Rivalry between the US and China is increasing. With tensions running high, the European nations should make greater efforts to coordinate their China policies, says Simona Grano. In her new book, the sinologist and China expert examines how this trial of strength between the two superpowers is impacting smaller nations.
Roger Nickl, Translation: Astrid Freuler
Simona A. Grano
"The foreign ministers of all the European countries should meet more often, to coordinate their policies on China": Sinologist Simona A. Grano.

Simona Grano, the recent shooting down of a Chinese spy balloon above the US has once more highlighted the charged relationship between the United States and China. In your research, you have been examining the rivalry between the two nations for some time. Are we currently witnessing the emergence of a new cold war?

Yes and no. The rivalry certainly exists. But there are fundamental differences to the Cold War of the late 20th century. There were no economic ties between the US and the Soviet Union back then, unlike today between the US and China. In 2021, for instance, China was the biggest import country for the US. And the ideology, the battle between the differing political systems, no longer plays such an important role as it did during the second half of the 20th century. Yet, although ideology plays a more subtle role than in the past, both superpowers frequently make use of it to justify a specific narrative – such as “democracies against autocracies” in the US, or the demonstration of a strong authoritarian regime that can withstand great social crises in China.

You recently published the book China-US Competition with a Taiwanese colleague. It explores the impact of the rivalry between these two superpowers on smaller nations in Europe and Asia – such as Switzerland and Taiwan – and their political strategies. What did you discover?

The rivalry between China and the US is gradually spreading to third-party countries. That, I believe, is the latest development. Almost all European and Asian countries we looked at are trying to remain in the middle zone between the two rivals. This indicates a certain amount of economic pragmatism. Governments don’t want to take sides, they prefer to decide where they stand on each individual issue.

Where does Switzerland stand?

Switzerland is perhaps even more reserved than other countries concerning its position. It is very cautious on the Taiwan question, for instance. It hasn’t expressed any clear views on that so far. Switzerland doesn’t want to criticize China too strongly. This has also become apparent in other respects. Shortly after the Russian attack on Ukraine, Switzerland imposed sanctions on Russia – but it hasn’t taken part in the sanctions over human rights violations in Xinjiang to date. I think there’s a specific reason for this stance: we are surrounded by NATO countries, so there are no heightened concerns regarding security here. Also, we’ve had a free-trade agreement with China since 2014, which has proved very valuable. Losing this would cause significant economic damage. And then there’s Switzerland’s status of neutrality, and the fact that many multilateral organizations are headquartered here. Switzerland wants to be a bridge builder, so it avoids taking sides. 

The question of neutrality is often the cause of controversy in this country, most recently in relation to the war in Ukraine. What role does neutrality play in the relationship with China? And how flexible is it? 

The foreign policy of a country is the expression of a particular time. We are living in a time of change, of high volatility and high tension. For this reason, Switzerland should adapt its approach, if not now, then in the future. Going forward, we in Europe should increasingly focus on the principle of “peace through cooperation”. In my opinion, it isn’t helpful for each country to pursue its own strategy on China. To ensure a strategy is truly effective, European countries must put much greater effort into working together.

What does this mean?

Switzerland wouldn’t have to give up its neutrality, of course. But the foreign ministers of all the European countries should meet more often, to coordinate their policies on China. And economic concerns shouldn’t be the only topic. There also needs to be more consultation regarding scientific collaboration with China. A multinational system should be established for exchanging information. That would have a considerable effect. Currently, the European countries are still pursuing individual strategies. Germany and Italy, for instance, have an entirely different China strategy to Britain. That ought to change.

Wouldn’t that encourage the formation of blocs, such as we remember from the Cold War?

To a certain extent, yes – at least regarding ideological aspects – but not economically. If China decided to stop cooperating with countries that share a coordinated approach, it would be taking great economic risks. The world is changing, the rivalry between the superpowers and the associated polarization are increasing. If Switzerland is forced to take sides at some future point, there’s no doubt about which side it will choose – the one it shares its values with. It’s no longer just down to us to decide as an independent nation. These are changes that are bigger than us. That’s why I believe a coordinated European approach will be unavoidable in the future.

You have touched on the increasing polarization. The Taiwan issue, in particular, has great conflict potential. How significant is the threat of war in your opinion?

The war in Ukraine has led China to become more cautious over the Taiwan issue. They have seen how difficult it is to subjugate a country. And the economic problems are another reason why a military attack on Taiwan is not top priority at present. So there are many aspects which indicate that, on a rational level, China is unlikely to try to annex Taiwan with force. But China is also a fairly unpredictable autocracy. We’ll have to watch and see how the situation between China and the US develops, as well as the conflict between Ukraine and Russia. What conclusions will the Chinese draw from the latter? At the moment they’re certainly being cautious. But it’s also important that the rest of the world takes action. To remind Xi every day that the cost of an attack on Taiwan is too high.

You’ve indicated that president Xi Jinping is taking a significantly more autocratic stance compared to his predecessors. What is your view on the developments in Chinese politics over the past few years?

The more autocratic stance of the Chinese government isn’t solely linked to Xi Jinping. This policy shift was already becoming apparent in 2008, four years before he took office. That’s when the Olympics were first held in China. They were an opportunity for China to showcase itself to the entire world. In the run-up to the Olympics, the government in Peking cracked down hard on migrants, for instance. The leaders wanted to tidy up the city and create a good impression for the visitors and the media. Then, a year on, China overtook Japan in terms of economic output. That bolstered the country’s confidence. Three years later, Xi Jinping came to power and launched a propaganda campaign based on the so-called Chinese Dream. It’s the old dream of China to regain its territorial integrity – including Taiwan and Hong Kong. This dream isn’t new, but it was newly packaged. They wanted to restore the power and respect that the country once had in the distant past. In that sense, the policy shift was influenced by numerous international and national factors.

What was the Communist Party’s role in this policy shift?

Under Xi’s predecessors, the Party was more liberal. It allowed people a certain amount of freedom. University professors have told me that during the early 2000s they could speak openly about everything, including the Party. But the Party was also very corrupt back then and nearly lost control over the population. Xi Jinping criticized his predecessors for this. He told them: “You’ve squandered the population’s respect. We must do something.” That’s why he launched an anti-corruption campaign quite early on in his term of office. This also helped him to oust his political opponents from their positions of power.

So the Party’s loss of control was an important factor in steering the government towards a more autocratic stance?

Yes, Xi certainly wanted to re-establish control. And he wanted to create a different leadership culture to that of his predecessors. Under Deng Xiaoping, the principle of collegiality was introduced among the Party leadership. The aim was to avoid a cult developing around individual leaders – such as occurred during Mao’s time. No single individual should ever accumulate so much power again. The leadership would make decisions cooperatively. That was why the presidents and general secretaries of the Communist Party of China were alternately put forward by two influential factions – the China Youth League and the Shanghai faction. When Xi came to power, he pushed these factions aside and established his own faction of loyal people.

How did the Party’s renewed power impact on Chinese society?

Until 2017/18, Xi was quite popular, also among young people. Many Chinese were proud that their country was great and powerful again. That’s no longer the case. During the three years of the coronavirus pandemic, China was in shock. Before, no one would have imagined that the state could be so restrictive towards its own citizens. Since the coronavirus pandemic, the mood in China has shifted. Parents predominantly feel that in terms of career chances, their children’s future lies abroad. Trust in the regime has taken a big hit.

China’s economy is more stagnant than it has been for a long time. Is the increased re-ideologization a contributing cause, alongside the coronavirus pandemic?

The pandemic is certainly an important factor in the economic stagnation. But the Party has also made some errors of judgment over the years. The government has increasingly veered to the right, towards nationalism. On economic matters, the country has moved further and further away from the liberal market economy that Deng wanted to implement. In 2020/21 for instance, Xi strongly intervened in the economy, cracking down on the booming trade and communications platform Alibaba owned by entrepreneur Jack Ma. Xi argued that this was to avoid a concentration of economic power. But ultimately, the main motive was to prevent the Party from losing control. And in many ways, it was also a personal power battle. Jack Ma saw himself as so powerful and important that he placed himself above the Party. Of course Xi couldn’t allow that.

What’s the current situation regarding the Chinese government’s political course?

In the last few months, the Chinese government has found itself confronted by a string of crises that seemed to weaken it. Last November, after three years of large-scale barricading, closures, quarantines and almost constant mass testing, Chinese citizens took to the streets and for the first time questioned President Xi Jinping’s leadership. Following a phase during which the economic policy in particular was based on ideology, the Party has now realized that the economic catastrophe for which it shares the blame is so big that it has to act. At the end of 2022, economic growth – for a long time one of the communist regime’s supporting pillars – fell to its lowest level in years. I think the Party leadership has recognized that it will have to open the market again. 

In conclusion, lets return to the rivalry between the US and China: what future development scenarios do you anticipate?

Taiwan will certainly remain one of the most important topics. In this regard, both countries ought to tone things down a little. The US, for instance, should avoid causing provocation. If the United States succeed in stabilizing the relationship with China, it would be to the benefit of all involved, and not least to the benefit of Taiwan. I think both governments have realized this. The question is, how will things continue after a change of government in the US and in Taiwan in 2024? 

How do you see Switzerland’s relationship with China developing over the coming years?

Switzerland will continue its balancing act and avoid taking a stand. But there will probably be increased calls in support of Taiwan and of a greater independence from China, both in parliament and across society. The Federal Council will have to respond to this.

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