Search

Begin New Search Topic International Relations Political Geography China Author John Lee Publication Year within 25 Years Publication Year within 10 Years Publication Year within 5 Years

1. Understanding and Countering China's Approach to Economic Decoupling from the United States

Author:
John Lee
Publication Date:
08-2022
Content Type:
Special Report
Institution:
Hudson Institute
Abstract:
Many experts have highlighted American efforts to partially decouple from China. Yet China began pursuing a far more ambitious and comprehensive decoupling strategy vis-à-vis the United States long before Donald Trump entered the White House. This monograph examines China’s evolving approach to economic decoupling from the US. It makes the following arguments and conclusions. First, on the back of a preexisting mercantilist political economic structure, China has been explicitly pursuing economic decoupling from US and allied economies on Chinese terms for at least a decade. Second, while the US seeks to decouple some aspects of its economic activity from China, the latter seeks to dominate vast segments of the Asian economy and to decouple these segments from the US. This is the Chinese strategy and threat that the US vastly underappreciates. Third, the most important segments are the high-tech and high-value sectors. These sectors are where competition is the most consequential and where decoupling on US terms needs to occur. Fourth, China faces increasingly serious problems and obstacles regarding its decoupling strategy. Many of these arise out of structural weaknesses inherent in its political economy. The monograph is written to assist the Biden administration and those who follow it to possess a deeper understanding of: China’s actions and the motives behind them; China’s strengths, weaknesses, and vulnerabilities; and How the US and its allies can craft an evolving approach that better plays to their individual and collective strengths and advantages. China hopes the US and its allies will adopt a cautious, gradualist, and ineffective approach to countering Beijing’s strategy and objectives. The Chinese Communist Party knows the US and other advanced economies still have immense advantages despite clever Chinese messaging to the contrary. The US and its allies continue to enjoy considerable leverage and remain well placed to partially decouple from China on their preferred terms, but they need to act quickly, collectively, and decisively.
Topic:
International Relations, Foreign Policy, Defense Policy, Economics, and National Security
Political Geography:
China, Asia, North America, and United States of America

2. Xi Jinping’s Evergrande Dilemma

Author:
John Lee
Publication Date:
09-2021
Content Type:
Policy Brief
Institution:
Hudson Institute
Abstract:
Evergrande is one of the top-two real estate developers in a still highly fragmented Chinese sector. Its main strategy is to achieve ever-increasing scale (rather than profitability) in order to move ahead of and crowd out commercial competitors. It has also amassed the largest land reserves of all Chinese developers, which were financed through massive borrowings. By 2018, Evergrande held 822 pieces of undeveloped land in 228 cities, with a planned gross floor area of 3.28 billion square feet of new homes—the equivalent of 10 percent of Germany’s entire housing stock. It paid $75 billion just for this undeveloped land. Although Evergrande’s market share is only around 4 percent, its borrowings stand out. Its current balance sheet liabilities amount to an estimated 2 percent of China’s gross domestic product (GDP), while its off-balance-sheet liabilities could be another 1 percent of China’s GDP. This makes Evergrande the most indebted property developer in the world. Burdened by this debt, struggling to meet its debt interest and repayment obligations, and viable only if property asset values and sales continue to increase, Evergrande faces possible financial collapse—an event bound to have flow-on effects for the Chinese economy. However, the unusually high global interest in Evergrande has arisen because its woes are increasingly seen as symptomatic of those faced by the broader Chinese economy, which is struggling with enormous levels of indebtedness and overreliance on the real estate sector. Debt held by nonfinancial institutions in China increased from about 115 percent of GDP in 2010 to around 160 percent of GDP currently. This is the most rapid and largest increase in a 10-year period for any major economy and makes the level of debt held by Chinese nonfinancial institutions one of the highest in the world. The real estate sector accounts for around 15 percent of GDP, while property services account for another 14 percent—the highest in any developing economy. The share of the real estate sector as a proportion of GDP was only about 4 percent in 1997 and 9 percent in 2008. Since 2008, up to a third of all domestic fixed investment has gone into real estate, and up to half of total national debt is linked to the real estate sector.
Topic:
International Relations, Foreign Policy, Debt, Economics, Markets, and Business
Political Geography:
China and Asia

3. Winning the Geo-Tech Battle and Building the Quad Alliance in the Indo-Pacific

Author:
Eric B. Brown, John Lee, and Thomas J. Duesterberg
Publication Date:
04-2021
Content Type:
Policy Brief
Institution:
Hudson Institute
Abstract:
Under Xi Jinping, the People’s Republic of China (PRC) has established as its paramount geopolitical objective the replacement of the free and open, rules-based order in Asia with an alternative world order, one that is to be dominated by the interests and values of the Chinese Communist Party (CCP). This decision presents a danger to the entire world, not just to any one state or group of states. For, as US Secretary of State Antony Blinken said at the March 2021 US-PRC meeting in Alaska, the alternative to a rules-based order “is a world in which might makes right and winners take all, and that would be a far more violent and unstable world for all of us.” In furtherance of its objectives, the PRC is in the midst of a large military build-up, but there is much more. For today’s CCP, political power grows not only from the “barrel of the gun,” as Mao Zedong once put it, but also from cutting-edge technologies. Thus, while Beijing pours billions into artificial intelligence and surveillance tech to impose its new “digital totalitarianism” inside the PRC, from Hong Kong to Xinjiang, it is also using its growing technological prowess to press its larger geopolitical agenda in the Indo-Pacific and beyond. It is weaponizing technology and connectivity, along with trade, finance, and other policy instruments to try to rule the key technologies and industries of the future, as well as to improve its strategic positioning and acquire political power over other countries—for instance, through its bid to dominate other nations’ most sensitive data networks, or via the export of its suite of “social stability” technologies, i.e., the “techno-tyrant’s toolkit.” In all this, the CCP’s intent is to entrench its power and Leninist norms and practices to the extent it can do so beyond the PRC’s borders, and to make other nations, or at the least their ruling elites, beholden to it. So in addition to the PRC’s militarily destabilizing activities in the West Pacific and incursions into India’s Himalayas, there is also a “geo-technological front.” If Xi’s CCP succeeds at enmeshing other countries in its expanding “PRC sphere of technological influence,” it could unlock and be able to exploit decisive military, economic, diplomatic, and ideological advantages.
Topic:
International Relations, Security, Economics, and Alliance
Political Geography:
China, South Asia, East Asia, and Asia-Pacific

4. The Opportunity is There: South Koreans’ Views of China and the Future of the US-ROK Alliance

Author:
John Lee
Publication Date:
04-2021
Content Type:
Special Report
Institution:
Pacific Forum
Abstract:
Officially, relations between the Republic of Korea and the People’s Republic of China remain cordial. Because of China’s economic heft and South Korea’s reliance on unmolested trade with the former for its continued economic development, South Korea takes great pains to be as neutral as possible between the United States and China despite its formal alliance with the US. As such, many pejoratively refer to South Korea as “the weak link” in America’s Northeast Asia alliance system. However, on a civil society level, an overwhelming majority of the South Korean public has a negative view of China—a view that has steadily gotten worse over time. Being a democracy that reflects voters’ popular will, growing anti-Chinese sentiment among voters means South Korea’s current policy of placating China will not be sustainable indefinitely. Meanwhile, the Trump administration largely neglected the alliance between South Korea and the United States. That neglect notwithstanding, an overwhelming majority of South Koreans either strongly or somewhat support the alliance with the United States. Conditions are perfect for the Biden administration to seek to repair and strengthen relations with South Korea to empower the alliance to serve as a credible bulwark against Chinese expansionism—this paper offers solutions on how to do so.
Topic:
International Relations, Foreign Policy, Economy, Alliance, and Trade
Political Geography:
China, Asia, and South Korea

5. Combating China’s COVID-19 Propaganda Offensive to Undermine the United States on the Global Stage

Author:
John Lee
Publication Date:
03-2020
Content Type:
Working Paper
Institution:
Hudson Institute
Abstract:
Throughout the United States, it is becoming increasingly clear that the Chinese Communist Party (CCP) is exploiting COVID-19 in an effort to reshape the global order and enhance China’s international leadership at the expense of the US. A range of prominent commentators further assert that the Trump administration bears much of the blame for this turn of events. This argument tends to rest on twin assumptions:1 China is winning the battle of narratives when it comes to comparative national competence and its decisiveness in responding to its COVID-19 outbreak. The Trump administration is damaging America’s standing by getting off to a bad start in its response to the pandemic, exposing the underlying weaknesses of American institutions and preparedness for such a crisis. These arguments correctly acknowledge that the global pandemic is occurring within a context of US-China strategic, political, and economic competition and/or rivalry. This is the point of warnings to the administration that there is more at stake than containing and managing the virus, even if that is the immediate priority.
Topic:
International Relations, Foreign Policy, Economics, Health, National Security, and COVID-19
Political Geography:
China and East Asia

6. A Global Survey of US-China Competition in the Coronavirus Era

Author:
Eric B. Brown, Patrick M. Cronin, H.R. McMaster, Husain Haqqani, Aparna Pande, Satoru Nagao, John Lee, Seth Cropsey, Peter Rough, Liselotte Odgaard, Blaise Misztal, Douglas J. Feith, and Michael Doran
Publication Date:
05-2020
Content Type:
Special Report
Institution:
Hudson Institute
Abstract:
The outbreak of the novel coronavirus has introduced a series of new stresses and factors in the US-China relationship. While the world has struggled to contain the pandemic and its tragic repercussions, the People’s Republic of China has used the outbreak to launch a global campaign of misinformation, further its economic coercion through the Belt and Road Initiative, and continue military expansion efforts in the South China Sea. China’s attempt to exploit the pandemic for political, strategic, and economic gain is problematic in the current environment, yet it is consistent with, and a continuation of, China’s long-term strategy. This report offers a global survey and assessment of attempts by the Chinese Communist Party (CCP) to expand its influence, including by exploiting the pandemic. As the United States and its allies focus on combatting the virus and salvaging their economies, there is an opportunity to better understand China’s strategy and develop a unified response.
Topic:
International Relations, Foreign Policy, Economics, Strategic Competition, and COVID-19
Political Geography:
China, South Asia, Asia, North America, and United States of America

7. Boosting Taiwan’s Economic Status is Good Strategy, Economics, and Domestic Policy

Author:
John Lee
Publication Date:
06-2020
Content Type:
Special Report
Institution:
Hudson Institute
Abstract:
This report makes the following arguments: From Taiwan’s perspective, the greater its economic presence and importance to the world, the better positioned it is to reduce its dependency on China and maintain its autonomy. This also serves US interests. From the US perspective, deepening the economic relationship with Taiwan in strategic ways will assist it in achieving greater economic distance from China and reducing the extent to which China can capture and dominate global supply and value chains in the future. The US and Taiwanese economies are largely complementary, and this can become even more so. Thus, a deeper bilateral economic relationship will be generally consistent with domestic economic objectives, such as prioritizing high-value job creation and preventing high-value supply chains from remaining in China or leaving the United States. The report offers recommendations to: help prevent the hollowing out of Taiwan’s competitive strengths; help Taiwan broaden and deepen its participation in the regional and international economic space, which is currently being narrowed by China; assist with Taiwan’s desire to lower dependency on China-based supply chains, especially with respect to high-value-added processes; encourage more bilateral investment, intra-industry relations and firm-to-firm activity between the United States and Taiwan.
Topic:
International Relations, Foreign Policy, Economics, and Domestic Policy
Political Geography:
China, Taiwan, and Asia

8. The Use of Aid to Counter China's "Djibouti Strategy" in the South Pacific

Author:
John Lee
Publication Date:
03-2019
Content Type:
Special Report
Institution:
Hudson Institute
Abstract:
China has gradually militarized its facilities in the horn of Africa (Djibouti) under the pretense of anti-piracy operations and development aid since 2017, which has forced the U.S., France, and Japan to accept a permanent Chinese military presence in the same 14,400 square-mile African territory, where China is now holding live-fire exercises. Dubbed the “Djibouti strategy,” Beijing is now executing this tactic across the South Pacific, one of the most aid-dependent regions of the world. China, one of the highest contributors to Official Development Assistant (ODA) in the South Pacific, uses that tool at first under the guise of aid while actually employing it to shape the islands’ infrastructure to its own strategic military advantage. China is currently building infrastructure capable of dual economic and military use in Fiji, the Cook Islands, Samoa, Tonga, Vanuatu, and other Pacific islands. These projects support China’s aim to break through the First and Second Island Chains, a series of pro-U.S. countries that limit Chinese naval access to the Philippine Sea and Pacific Ocean. Meanwhile, U.S. ODA is deployed inefficiently and inconsistently through 19 separate agencies. The design, delivery, and administration of U.S. development assistance must be reformed. ODA is a national security issue, not just a humanitarian one. The U.S. defense community needs to embrace the strategic potential of ODA and its capacity to strengthen democracies and counter malign influence abroad.
Topic:
International Relations, Foreign Aid, Infrastructure, Alliance, and Soft Power
Political Geography:
Africa, China, Asia, Djibouti, Cook Islands, Samoa, Tonga, Vanuatu, United States of America, Fiji, and South Pacific

9. China’s Economic Slowdown: Root Causes, Beijing’s Response and Strategic Implications for the US and Allies

Author:
John Lee
Publication Date:
12-2019
Content Type:
Special Report
Institution:
Hudson Institute
Abstract:
This monograph attempts to argue and/or demonstrate three main points. First, it looks at why there were credible fears about the stability and viability of the Chinese economy — especially the financial and banking system — leading up to the end of the Twelfth Five Year Plan (2011–15), and what these were. To understand why Beijing was so concerned, the monograph draws out the serious structural problems that were leading inevitably to a permanent slowdown from the double-digit growth rates of the first three decades of reform. Second, the monograph looks at what occurred from 2015 to the present, and how China apparently overcame its economic difficulties. In fact, it has not overcome its problems, but deferred them to a future time in ways that only its unique authoritarian political economy is able to do.Third, it is clear the Communist Party is not passively awaiting an unhappy economic fate in connection with its mounting imbalances and domestic economic dysfunction. In many respects, its leaders have been highly creative in seeking solutions that do not entail a weakening of the party’s hold on economic power. On the contrary, the party has been busily shaping and pursuing grand strategic policies such as the Belt and Road Initiative (BRI) and Made in China 2025 (MIC 2025) to solve or alleviate many of its domestic political-economic problems. This monograph argues that these and other outward-focused initiatives stem most fundamentally from Chinese weaknesses and vulnerabilities but are being remade and recast into initiatives that will strengthen the position of the CCP domestically, ensure greater resilience for its political economy, and advance its ambitious strategic and international objectives at the same time. In summary, it is about the Communist Party cleverly transforming domestic vulnerability into grand strategy and using economic approaches to gain pre-eminence and “win without fighting.”
Topic:
International Relations, Foreign Policy, National Security, Geopolitics, Economy, Belt and Road Initiative (BRI), and Strategic Competition
Political Geography:
China, Asia, North America, and United States of America