There is a view liberal democracy is in its twilight years and the gathering, on 11-13 June, of the Group of Seven industrialised economies – with Australia, South Korea, and India also invited – could be little more than a heroic last stand by the so-called Democratic 10, or D10. According to this perspective, the landing of Scott Morrison, the Prime Minister of Australia, in Britain to rally democracies to resist coercion and preserve freedom is a fool’s errand and will needlessly provoke China. Why will he not accept the tide of history has changed and is washing away liberal practices in its wake?
The record shows arguments about inevitability are almost always wrong. That China is powerful is undeniable. Even so, it is poorly appreciated that China, and the entire region more generally, cannot continue to rise without the resources, know-how and assistance of the democracies who recently met in Cornwall in the UK. We know getting democracies to act together is more difficult than herding cats. But they are far from a spent force and democracies retain considerable strategic and economic agency. The summit was one of the more consequential gatherings for Australia and the Indo-Pacific region. A rule of thumb in international affairs is the inverse relationship between the size of the grouping and the determination to tackle important and difficult issues.
Unlike recent G7 summits with a motley collection of observer nations, this year’s version had only four invited guests – the three regional democracies mentioned and democratic South Africa. Narendra Modi, the Prime Minister of India, was unable to attend in person because of the COVID-19 emergency in his country. But composition is indicative of intent. It is no coincidence that Australia and India were invited. With the US and Japan, they comprise the Indo-Pacific Quad, the four formidable economic and military powers most committed to counter directly the worst aspects of Chinese behaviour. The Quad countries may be ahead of the curve but there is broader support for them than is widely appreciated.
Britain, the EU and Canada belatedly have come to a similar conclusion that the military, industrial, trade, technological and repressive policies of China is a serious and growing threat to their individual and collective interests. It is worth noting this year’s G7 summit was framing discussion on many issues ranging from pandemic response to trade and technological policy as defined by a contest between liberal and authoritarian approaches. Resolve is one thing. What about the notion that the proverbial horse has bolted and it is futile to resist creeping Chinese economic and eventually political and military dominance of the region? The combined military weight and prowess of the democracies are superior, even if the gap is closing quickly. But much will depend on the trajectory and decisions of the trading nations in the Indo-Pacific.
In this context, Chinese hopes of economic dominance may be fulfilled only if maritime East Asia becomes a Sino-centric region. Many believe this has already occurred or else is imminent. It may surprise some that foreign direct investment from Japan, the US, EU and South Korea – all present at Cornwall earlier this month – are more important sources of capital for developing trading nations in Asia than is China. Partnerships with governments and firms from these advanced democracies add far more to the productive capacity of these developing maritime nations than do interactions with Chinese entities. Moreover, these regional economies – China included – are heavily reliant on importing innovation, technology and know-how, the lion’s share coming from entities headquartered in D10 nations. Beijing cannot afford economic separation from democratic nations but seeks their subservience and acquiescence to unequal arrangements in China’s favour.
In large measure, ambitious Chinese blueprints such as the Belt and Road Initiative and Made in China 2025 were formulated to address its own vulnerabilities and shortcomings. Even then, the BRI cannot succeed if China is unable to freely access the deep consumer markets in Western Europe. This then is the frustration and danger for the Chinese Communist Party. China needs continued access to D10 consumer markets, technologies, innovation, know-how and finance to get itself into a position of enduring strength. Far from being a self-sustaining economic behemoth, China is making the mistake of spiting the nations on which it needs to continue its rise. The list of complaints is long and growing – systemic economic predation and theft, unreciprocated trade and investment practices, military assertiveness, territorial expansion, economic coercion and interference in the institutions of other nations.
Shouldn’t China have expected pushback? Yes, although Beijing was relying on a divide-and-rule approach, which is possible in the absence of democratic unity or where there is a loss of faith in democratic community itself. Encouraging the latter is what its messaging about superior authoritarian competence is all about – a perspective too many enjoying the fruits of democratic society are all too happy to accept without further investigation. Hubris and overreach will come back to bite. China has crossed the line too far and too many times. Democracies in North America, Europe and Asia – and Australia in the Pacific – are starting to talk in similar ways and move in similar directions, albeit at different speeds as democratic processes are always messy and inelegant. Beijing sought to cast the summit as a democratic China-bashing weekend, but it has only itself to blame.
‚Hubris and Overreach Will Come Back to Bite China‘ – Analysis by John Lee – United States Studies Centre.