CSR Blog: Put on Your Rose-colored Glasses: Outlook for China’s Political Stability and Growth

By Jennifer Lee

In alignment with American public opinion, politicians on both sides of the aisle support policies to address China’s prowess as a “strategic competitor,” though the opinions on tactics differ.1,2 No one expects the Biden administration to hastily alter the US stance and go easy on China.3 This is consistent with the fact that distrust between the United States and China existed during the Obama administration, when Joe Biden served as Vice President.4 Indeed, on his first call as President with Xi Jinping, Biden pressed on issues of trade and human rights,5 and he has maintained the Trump-era tariffs for the time being.6 Regardless, President Joe Biden’s advisors should lean towards an optimistic view for a politically stable China with the potential for continued growth. The regime has domestic approval particularly in the wake of the COVID-19 epidemic, and the Party has solidified its power base through Xi Jinping’s utilization of leadership small groups. To drive future economic growth, the country can further invest in trending arenas like infrastructure development and renewable energy technology. China faces some large speed bumps in policy implementation, environmental protection, and political succession; however, China’s political engine has the tools necessary to smooth out these obstacles if used effectively.

China’s current domestic approval of the regime facilitates its future political durability. The Chinese public regards strong leadership and governance as solutions to issues and drivers of progress rather than as cause for problems.7 Due to this conviction, weak leaders are actually considered threats because decisive, stalwart leaders are perceived to ensure stability.8 The desire for political stability favors Xi Jinping’s strongman persona. In fact, members of the Chinese Communist Party have admired Xi for his strength as a foil to Hu Jintao’s leadership style.9 

The outbreak of COVID-19 has bolstered the resilience of the Chinese Communist Party. Despite initial criticism over the silencing of early COVID-19 whistleblowers, the Chinese public largely supports Xi’s handling of the COVID-19 epidemic.10 This partly arises from shifting blame for inept responses to the local authorities in Wuhan.11 Additionally, global reactions to the pandemic have enhanced nationalism in China. Anti-Chinese and anti-Asian racism continue to rise as multiple countries use derogatory language pinning responsibility for the COVID-19 outbreak on China.12 Misinformation about the origin of the virus spread on social media, and later both Chinese and American officials suggested alternative origin conspiracy theories, claims such as intentional cultivation or dissemination by a Chinese lab or the US military.13 This politicization deepened the frustration felt by Chinese citizens when Western narratives fault China alone for the pandemic. External discrimination enhances the pushback against  harsh Western criticism, rallying Chinese support for Xi’s regime, especially among young citizens active on social media.14 A post on Zhihu, the Chinese Q&A forum, about foreign governments failing to learn from China’s COVID-19 response has more than 18 million views.15 Analysis of discourse on the site indicates strong nationalism and a sense of achievement around the Chinese response to the pandemic.16 Furthermore, the performance of the United States provides a stark contrast to the relative success of China in containing the virus. In 2019, China ranked fifty spots below the United States in terms of pandemic preparedness.17 Shockingly, as of February 26, 2021, US deaths topped over 510,000 while China totaled less than 5,000 deaths,18 though some scholars indicate inconsistencies in China’s COVID-19 data reporting.19 Nevertheless, this adds to Chinese perceptions of Western accusations of China’s COVID-19 response as hypocritical.20 All these factors culminate in high domestic faith in Xi and the Party, the state, and the authoritarian style of governance.21 By handling a crisis better than many democratic governments have, the Party reinforces its positive image of authoritarian rule among Chinese citizens and protects regime legitimacy. This steadies the outlook for at least China’s domestic politics.

In another effort to maintain political stability, the Party has consolidated power through the elevation of leadership small groups, at the expense of rupturing the xitong (系统), organizational clusters of bureaucracies around a policy area. Prior to the 2010s, Cheng Li identified a shift away from dominant, imposing individual leaders to more collective leadership in the post-Mao era.22 The power consolidation exhibited by Xi and the Party bucks this trend. Xi Jinping himself heads many of the powerful leadership small groups.23 He establishes and promotes these bodies to help take over traditionally state-controlled fields.24 For example, purview the Leadership Small Group on Comprehensively Deepening Reform, directed by Xi, ranged from public security and financial markets to natural resources and the economy.25,26 The economy used to fall mainly under the jurisdiction of the state.27 By mixing Party and state territories, this leadership small group disrupts xitong demarcations. Xi took this a step further by transforming the leadership small group into a commission in 2018.28 Moreover, Xi brought legal oversight of cadres to the Party and away from the state by routing cadre violations to the Party’s Central Discipline Inspection Commission instead of the public security xitong.29 From the Party’s perspective, reducing the agency of the state and expanding the purview of the Party contributes to consistent and uniform policies that will sustain social contentment and prevent unrest.

In addition to the political stabilization grounded in domestic satisfaction and party power consolidation, China has the potential for future economic growth through emerging technology investment and outward foreign direct investment. Renewable energy technology represents a strength of Chinese innovation. China’s market alone accounted for 45 percent of total global renewable energy investment in 2017.30 It also holds 26 percent of the world’s renewable energy technology patents.31 China produces and exports the largest amount of solar photovoltaic panels, wind turbines, and electric vehicles worldwide.32 With the United States and Europe failing to keep up with China’s research and development investment, fuel efficiency standards, and financial incentives,33 China sets itself up to dominate renewable energy trade and access subsequent future gains in economic growth. Looking at outward foreign direct investment, China’s Belt and Road Initiative (BRI) affects nearly eighty countries34 and has funneled over $500 billion in investments into five ASEAN nations alone in the span of five years.35 The BRI infrastructure projects create greater energy security for China by reducing dependence on imports through maritime chokepoints like the Strait of Malacca, connecting China’s economy to other regional economies, and extending China’s influence through financial leverage.36,37 The BRI also presents an opportunity for China to market itself as a purveyor of global public goods, something the United States receives criticism for resisting.38 This would improve China’s geopolitical standing and promote collaboration with China as a secure investment.

Still, these triumphs may encounter roadblocks that negate the potential prosperity for China if not properly addressed. For example, previous cases of Chinese economic activity abroad have proven to hinder international policy goals because China’s fragmented authoritarian structure lacked the capability to enforce regulations on its profit-seeking state-owned enterprises. In Myanmar, the China Power Investment Corporation (CPI) defied Chinese policies governing authorization of energy projects abroad without repercussions until after the fact.39 CPI ignored alarming environmental impact assessments of its Myitsone hydropower project and lied to Chinese regulators.40 Local opposition to the dam on cultural and environmental grounds continued to mount in the Kachin community. This helped reignite anti-government Kachin insurgency and ethnic civil war, much to Myanmar’s displeasure.41 The fallout from the Myitsone hydropower project reignited strained relations between China and Myanmar. For China to capitalize on the BRI investments, it will need to shore up its capacity for enforcing international regulations and collaborate with project site governments to effectively implement its plans. With their pursuit of power consolidation, Xi and the Party have the political means necessary to overhaul the regulatory capabilities of China’s institutions over international projects to prevent future international relations crises borne from investment projects.

Environmental policy presents another challenge if Beijing wants to maximize its profits from renewable energy technology trade. Economic efforts often clash with environmental proposals, where furthering the economy usually wins.42 Environmental protections that China does execute usually only deal with highly visible problems, like air pollution, because they receive greater public outcry, are quantifiable, and the government can easily demonstrate improvement.43 Economic gains and environmental protection do not have to conflict; they can coexist through the marketing of Chinese renewable energy technology. The clout for China’s renewable energy technology would improve with demonstration of domestic political enthusiasm for environmental issues. The Party can enhance political will by adjusting the cadre management system. Because of competing demands and the need to match the Party’s priorities, cadres engage in selective implementation, often placing social order or economic reforms above all else.44 Party leaders can raise the importance of environmental objectives by elevating the priority status of eco-friendly initiatives.

Finally, a threat to the political endurance of the regime comes in the form of uncertainty around political transitions. Contrary to Western perceptions, the Chinese political system traditionally has separation of power and other checks on power. The different roles between the state and the Party usually operate like separation of power,45 and age and term limits on official positions also exist.46 However, Xi’s consolidation of power through leadership small groups allows the Party to skirt around some of the state’s input, and behind-the-scenes bargaining in 2018 discarded the term limits previously applied to the leader of the PRC.47 Lack of assurances for predictable, peaceful transfers of power can cause fissures within the Party and lead to the public questioning the legitimacy of the regime.48 On the other hand, longer terms provide greater continuity and more time to work on long-term reforms.49 To mitigate the potential dangers to regime survival from unlimited political reign, the Party should utilize its consolidated power to replace age limits with more institutionalized term limits.50 Xi can balance this need for legitimation with the stabilizing benefits of longer leadership by reinstating term limits, but longer ones. He could announce at the 20th Party Congress in 2022 longer term limits, including the resumption of term limits on the PRC chairmanship position he holds. By reintroducing and extending term limits, he will assuage some of the fears around his continuation of power, helping to legitimize the regime, while still lengthening his tenure if he desires.

Stepping back to view the overall outlook for China, American political advisors should recognize the realistic picture of China’s political durability and space for even more economic growth. Chinese support for the regime at home and successful power consolidation of the Party build the case for a stable political atmosphere in the future. Although ambiguity around changes in leadership could threaten the legitimacy of the Party-state, issuing longer term limits could relieve some unease regarding the lack of public planning for Xi Jinping’s successor. China’s economy stands to benefit from opportunities in renewable energy technology and outward foreign direct investment, such as through the BRI. By not taking environmental threats seriously, China may undermine the marketability of its renewable energy products to other countries. Changes to the classification of environmental policies in the hierarchy of cadre policy implementation could spur greater follow through on ecosystem protection measures. In regards to outward foreign direct investment, Beijing should strengthen the international enforcement capability of its regulatory bodies, which it has the means to achieve because the power consolidation by the Party partially reduces some of the fragmentation of the political system. If successful, then smooth and cooperative implementation of the BRI will follow, which will allow China to reap economic and geopolitical benefits. While not a guaranteed path, China’s current characteristics project future political stability and continued prosperity, and it has the means to overcome problems challenging this positive outlook.

Jennifer Lee concentrates in China Studies with a minor in Energy, Resources, and Environment as a first-year MA student at Johns Hopkins Paul H. Nitze School of Advanced International Studies (SAIS). Prior to SAIS, she worked as a Research Assistant at the Johns Hopkins Bloomberg School of Public Health and as a Research Intern at the Urban Institute. Her research interests include the intersection of health policy, environmental policy, and domestic and foreign Chinese politics.

___________________________

 1Michael Green and Louis Lauter, “Congress will have a return to bipartisan policy with China,” The Hill, October 22, 2020, https://thehill.com/opinion/international/522277-congress-will-have-return-to-bipartisan-policy-with-china.

2 Doyle McManus, “Bipartisan agreement, for a change: Trump and Biden share a distrust of China,” LA Times, October 11, 2020, https://www.latimes.com/politics/story/2020-10-11/column-trump-and-biden-share-deep-distrust-of-china.

3 Karishma Vaswani, “Trump or Biden? China expects no favours either way,” BBC News, August 28, 2020, https://www.bbc.com/news/business-53928783.

4 Kenneth Lieberthal and Wang Jisi, “Addressing US-China Strategic Distrust,” John L. Thornton China Center Monograph Series 4 (March 2012): 14, https://www.brookings.edu/wp-content/uploads/2016/06/0330_china_lieberthal.pdf.

5 The White House, “Readout of President Joseph R. Biden, Jr. Call with President Xi Jinping of China,” February 10, 2021, https://www.whitehouse.gov/briefing-room/statements-releases/2021/02/10/readout-of-president-joseph-r-biden-jr-call-with-president-xi-jinping-of-china/.

6 Peter Martin, Saleha Mohsin, Nick Wadhams, and Jenny Leonard, “Biden, in Call With Xi, Talks of ‘Unfair Economic Practices’,” Bloomberg, February 10, 2021, https://www.bloomberg.com/news/articles/2021-02-10/biden-xi-plan-first-call-as-soon-as-wednesday-evening-in-u-s.

7 David M. Lampton, Following the Leader: Ruling China, from Deng Xiaoping to Xi Jinping (Berkeley: University of California Press, 2014), 58.

8 Lampton Following the Leader, 68.

9 Dimitar D. Gueorguiev, “Dictator’s Shadow: Chinese Elite Politics Under Xi Jinping,” China Perspectives 2018/1-2 (June 2018), 21, https://doi.org/10.4000/chinaperspectives.7569.

10 Cary Wu, “How Chinese citizens view their government’s coronavirus response,” The Conversation, June 4, 2020, https://theconversation.com/how-chinese-citizens-view-their-governments-coronavirus-response-139176.

11 Sungmin Cho, “COVID-19 Has Dimmed Xi’s Approval Ratings Abroad–But Not in China,” The Diplomat, October 9, 2020, https://thediplomat.com/2020/10/covid-19-has-dimmed-xis-approval-ratings-abroad-but-not-in-china/.

12 “Covid-19 Fueling Anti-Asian Racism and Xenophobia Worldwide,” Human Rights Watch, last modified May 12, 2020, https://www.hrw.org/news/2020/05/12/covid-19-fueling-anti-asian-racism-and-xenophobia-worldwide#.

13 Yanzhong Huang, “How the Origins of COVID-19 Became Politicized,” Think Global Health, August 14, 2020, https://www.thinkglobalhealth.org/article/how-origins-covid-19-became-politicized.

14 Cho, “Not in China.”

15 “Why did not foreign countries fully learn from China’s experience in the prevention and treatment of COVID-19?” Zhihu, last accessed February 20, 2021, https://www.zhihu.com/question/381011221.

16 Xiaoyu Zhao, “A Discourse Analysis of Quotidian Expressions of Nationalism during the COVID-19 Pandemic in Chinese Cyberspace,” Journal of Chinese Political Science (September 2020): 1-17, https://doi.org/10.1007/s11366-020-09692-6. 

17 Nuclear Threat Initiative and Johns Hopkins Center for Health Security, Global Health Security Index: Building Collective Action and Accountability (NTI, 2019), 20-22, https://www.ghsindex.org/wp-content/uploads/2020/04/2019-Global-Health-Security-Index.pdf.

18 “COVID-19 Dashboard by the Center for Systems Science and Engineering at Johns Hopkins University,” Johns Hopkins Coronavirus Research Center, last modified February 26, 2021, https://coronavirus.jhu.edu/map.html.

19 Nick Paton Walsh, “The Wuhan files: Leaked documents reveal China’s mishandling of the early stages of Covid-19,” CNN, December 1, 2020, https://www.cnn.com/2020/11/30/asia/wuhan-china-covid-intl/index.html.

20 Cho, “Not in China.”

21 Wu, “How Chinese citizens view.”

22 Cheng Li, “China’s Communist Party-State: The Structure and Dynamics of Power,” in Politics in China: An Introduction, ed. William A. Joseph (Oxford: Oxford University Press, 2010), 184.

23 Alice Miller, “More Already on the Central Committee’s Leading Small Groups,” China Leadership Monitor 44 (Summer 2014), 6, https://www.hoover.org/sites/default/files/research/docs/clm44am.pdf.

24 Andrew Mertha, “Stressing Out: Cadre Calibration and Affective Proximity to the CCP in Reform-era China,” The China Quarterly 229 (March 2017): 82, https://doi.org/10.1017/S0305741017000042.

25 Gueorguiev, “Dictator’s Shadow,” 18.

26 Christopher K. Johnson, Scott Kennedy, and Qiu Mingda, “Xi’s Signature Governance Innovation: The Rise of Leading Small Groups,” Center for Strategic and International Studies, October 17, 2017, https://www.csis.org/analysis/xis-signature-governance-innovation-rise-leading-small-groups.

27 Johnson, Kennedy, and Qiu, “Xi’s Signature Governance Innovation.”

28 “Sweeping governance changes to put ruling party in control,” The Economist, last modified March 22, 2018, https://country.eiu.com/article.aspx?articleid=166545200&Country=China&topic=Politics&subtopic=For_9.

29 Mertha, “Stressing Out,” 79.

30 Global Commission on the Geopolitics of Energy Transformation, A New World: The Geopolitics of Energy Transformation (IRENA, 2019), 28, https://irena.org/-/media/Files/IRENA/Agency/Publication/2019/Jan/Global_commission_geopolitics_new_world_2019.pdf.

31 Global Commission on the Geopolitics of Energy Transformation, Geopolitics of Energy, 40.

32 Global Commission on the Geopolitics of Energy Transformation, Geopolitics of Energy, 40. 

33 Annika Bose Styczynskia and Llewelyn Hughes, “Public policy strategies for next-generation vehicle technologies: An overview of leading markets,” Environmental Innovations and Societal Transitions 31 (September 2018): 265, https://doi.org/10.1016/j.eist.2018.09.002.

34 Global Commission on the Geopolitics of Energy Transformation, Geopolitics of Energy, 49.

35 Carla Freeman and Mie Ōba, Bridging the Belt and Road Divide (Carnegie Endowment for International Peace, October 2019), 1, https://carnegieendowment.org/files/ChinaRiskOpportunity-Belt_and_Road.pdf.

36 Global Commission on the Geopolitics of Energy Transformation, Geopolitics of Energy, 49.

37 Freeman and Ōba, Bridging, 1. 

38 Freeman and Ōba, Bridging, 6.

39 Lee Jones and Yizheng Zou, “Rethinking the Role of State-owned Enterprises in China’s Rise,” New Political Economy 22, no. 6 (May 2017): 752-753, https://dx.doi.org/10.1080/13563467.2017.1321625.

40 Jones and Zou, “Rethinking State-owned Enterprises,” 752-753.

41 Jones and Zou, “Rethinking State-owned Enterprises,” 753-754.

42 Genia Kosta and Jonas Nahm, “Central–Local Relations: Recentralization and Environmental Governance in China,” The China Quarterly 231 (September 2017): 568, https://doi.org/10.1017/S0305741017001011.

43 Kosta and Nahm, “Central–Local Relations,” 572. 

44 Kevin J. O’Brien and Lianjiang Li, “Selective Policy Implementation in Rural China,” Comparative Politics 31, no. 2 (January 1999): 167, https://www.jstor.com/stable/422143.

45 Gueorguiev, “Dictator’s Shadow,” 18.

46 Zhengxu Wang and Anastas Vangeli, “The Rules and Norms of Leadership Succession in China: From Deng Xiaoping to Xi Jinping and Beyond,” The China Journal 76 (May 2016): 30-31, https://doi.org/10.1086/686141.

47 Gueorguiev, “Dictator’s Shadow,” 18-19. 

48 Wang and Vangeli, “Norms of Leadership Succession,” 39-40. 

49 Gueorguiev, “Dictator’s Shadow,” 21.

50 Wang and Vangeli, “Norms of Leadership Succession,” 40.

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