Fair enough: everyone understands that China deserves a big say in what goes on in its neighborhood. But what most people haven't noticed yet is that Beijing also wants to write—or, at least, help write—new
rules of the road for the world. "China now wants a seat at the head of
the table," says Cheng Li, director of research at the John L. Thornton
China Center at the Brookings Institution. "Its leaders expect to be
among the key architects of global institutions."
It's easy to forget that big international bodies like the IMF and the World Bank were created by just a few nations, led by the United States.
These economic organizations have global reach, but that globe used to
be dominated by the American superpower, and their policies were
suffused with U.S. values. When Beijing was a small-stakes player its
leaders didn't always like the setup, but they lived with it, even
facing down fierce grassroots opposition to join the World Trade
Organization.
But now China has more worldwide clout, and public opinion at home has taken on a combative (and sometimes downright jingoistic) tone. So with one eye on China's national
interests and the other on domestic critics accusing the regime of
"coddling" the West, Beijing has begun to push harder to reshape
international systems to make them more China-friendly (and, in the
process, to raise the regime's chances of survival).
Ironically, U.S. officials often complain that Beijing isn't more involved in running the world—declining to help security efforts in Afghanistan, for instance. But in most such cases, China is being asked
to take part in a system it didn't set up—one it views as inherently
biased in favor of the West. The Chinese are far more eager to
participate in groups they've had a hand in building, like the Shanghai
Cooperation Organization, a sort of Central Asian NATO in which China
(as might be guessed from the name) plays the leading role. While that
alliance started out as something of a joke in 1996, it's grown into a
pillar of regional security.
Similarly, Beijing's efforts to push the yuan as a rival to the dollar are now making tentative progress. In the last few months, China has inked $100
billion in currency-swap agreements with six countries, including
Argentina, Indonesia, and South Korea. The yuan has become an official
trading currency between Southeast Asia and two Chinese provinces along
its periphery. "The yuan will next be used as a trading currency with
India, Pakistan, Russia, Japan, and Korea," says Gu Xiaosong, director
of the Institute of Southeast Asian Studies in Nanning.
Those countries will eventually be able to use the Chinese currency for deals between each other. And in an-other low-profile but important step
toward making the yuan a freely convertible, international currency,
Beijing issued its first international bond offering in Hong Kong late
last year.
IPv6 will provide trillions of new addresses for everything from Web sites to intelligent home appliances and military applications—and Beijing intends to get its share of them. China may also get a new
opportunity for cyber-spying: unlike the previous architecture, IPv6
allows addresses to be attached to specific computers or mobile
devices, which would give the regime greater ability to police its
Netizens.
All these efforts are motivated by an odd mix of confidence, pride, and insecurity. On the one hand, China knows its technological capabilities are dramatically improving and sees a
chance to move beyond the West in certain fields. "There's always been
this feeling in China and a number of other developing nations that the
West was the place to be—and now suddenly it's not," says Ruchir
Sharma, head of emerging markets for Morgan Stanley Investment
Management. Chinese scientists and researchers are flocking home to
conduct original research at well-funded labs.
On the other hand, the Chinese worry that if they're not involved in writing the new standards, those could be manipulated by their enemies. The regime has tried to bar government computers from running Microsoft
software, for example, largely because it's assumed that such software
might include a "back door" that would allow the U.S. government to
launch cyberattacks against China.
Indeed, while China isn't necessarily looking to take over the world, its actions all put Chinese interests foremost. Beijing's space programs are highly
secret, but they've been ramped up in recent years with the first
successful test of an antisatellite weapon in 2007, followed this year
by the launch of an exo-atmospheric surface-to-air missile (which some
Western security experts think may actually be a new satellite-killer
weapon). Earlier this month China confirmed plans for its second
unmanned lunar probe in October and the 2011 launch of a space module
for the country's first docking exercise, all leading up to a 2013 moon
landing. With NASA's budgetary rollback, China is now the only country
making major investments in space exploration.
Why the big push to reach the moon? Beijing clearly expects more material gain from its celestial adventures than the Americans have gotten. Some
Chinese scientists are sure that space is the place to find potential
new energy sources like helium-3, as well as fresh lodes of rare
minerals that are being gobbled up by industrial production on earth;
Ye Zili of China's Space Science Society has been quoted as saying that
when the Chinese reach the moon, they won't "just pick up a piece of
rock"—a clear dig at past U.S. missions. The rules governing the
exploitation of extraterrestrial resources have yet to be written. When
they are, China wants its stake to be well represented.
The same principle explains the country's overall drive to move ahead of the rest of the world: to make sure it gets a real say in setting its
future rules and standards. It knows it can climb the economic ladder
more easily in new and developing technologies than in traditional
industries, and that's why China, the world's biggest polluter, has
also become the single biggest state supporter of green technology.
Thanks to massive government subsidies, it's now a world leader in
solar- and wind-energy hardware and is moving fast to set the standard
in the next generation of clean-energy vehicles. Batteries made by the
Chinese firm BYD are already used in at least a quarter of the world's
mobile-phone market; now the battery maker is leading the global race
to adapt these batteries for cars, the biggest remaining hurdle in
creating a viable market for electric and hybrid automobiles.
In December, the U.S. Chamber of Commerce and 33 other business organizations from around the world sent a letter to Beijing protesting legislation that they claimed would
effectively bar foreign firms from China's lucrative
government-procurement markets. Beijing is even taking control of the
venture-capital business. One of the world's top private-equity firms,
the Carlyle Group, was recently obliged to join forces with the Beijing
city government in order to be allowed to invest in more deals in China.
The idea that as China got rich it would simply become more like America, or at least more sympathetic to the U.S. agenda, is turning out to be wrong.
China has never been transformed from without, and it's unlikely to be
now. Among ordinary Chinese, pride in their nation's prospects is
matched by a nagging feeling that it's all still too new and
precarious. The dizzying pace of change is having a particularly
dramatic effect on younger Chinese, turning them inward and making them
more nationalistic—a trend that experts like Hudson Institute fellow
John Lee believe to be a factor in China's new and more aggressive
policies on security, trade, and foreign affairs. That aggressiveness
is only likely to increase between now and 2012, when the top
leadership of the Communist Party will be changed. Officials jockeying
for positions between now and then will "lose points if they are
perceived as being too soft in any sort of negotiation with the U.S.,"
says Li of Brookings.
China is clearly still working out its identity: is it a rich nation or a poor one, a major power that should lead on global issues or a developing one that should simply
look out for itself? That confusion is likely to lead to more debacles
like the December climate-change summit in Copenhagen, where Beijing
scuppered a deal by refusing to commit to binding emissions cuts. Much
was made of the fact that Premier Wen Jiabao snubbed President Obama by
sending a lower-level official to a crucial meeting for global heads of
state. If China really wants a seat at the table, one might ask, why
fill the seat with a flunky?
According to a foreign official familiar with the proceedings who was not authorized to speak on the record, Wen had not been granted the authority to make decisions
at the meeting. Rather than being embarrassed by his lack of mandate,
he chose to stay away. (The Chinese official who replaced him protested
that he too couldn't make any decisions—because his cell-phone battery
had run out.)
In the end, it was the Chinese fear of being caught, or contained in a trap laid by the West, that drove much of the delegation's eyebrow-raising behavior in Copenhagen. It's
nowhere near clear what our world will look like when China has done
its part to reshape it. But the journey toward that world promises to
be a bumpy one.
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"Destroying the New World Order"
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