Digest

Fall 2020 Issue 65

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Investigation of a Death Long Feared: How China Decided to Impose its National Security Law in Hong Kong

 

By Minxin Pei, CLM Editor

China’s recent imposition of a national security law (NSL) in Hong Kong has gutted the “one country, two systems” (OCTS) model. Open-source materials shed light on the obscure decision-making process that led to the law’s implementation.  Below are the main findings.

 

  • The Umbrella Movement in 2014 likely served as the main turning point for CCP leadership in determining future plans for the status of Hong Kong. However, it was not until Xi Jinping’s speech delivered in Hong Kong on July 1, 2017, the 20th anniversary of the region’s return to China, that these plans were partially articulated to the public, albeit vaguely. Xi also coined a phrase in his 2017 speech that later became a marker for Beijing in evaluating the severity of the crisis in Hong Kong: his “bottom line.” In his speech, Xi declared that “any activities that endanger national sovereignty and security, challenge the authority of the central government and the authority of the Basic Law of the Special Administrative Region, and use Hong Kong to engage in infiltration and sabotage in the mainland touch [our] bottom line and will absolutely not be permitted.” In explicitly defining the parameters of his “bottom line,”

 

  •  Between Xi’s 2017 speech and the unrest in Hong Kong in 2019, Chinese authorities were preparing various options, including its own national security law, to assert control in Hong Kong. The New York Times revealed that Chen Duanhong, a Peking University academic specializing in constitutional theory, had submitted a report entitled “The Dilemma of Enacting a National Security Law in Hong Kong” to the General Office of the Central Committee in 2018.

 

  • By the end of July 2019, the protests in Hong Kong had apparently breached Xi’s “bottom line.” On July 22, the day after protestors defaced the national emblem on the building of the central government’s Central Liaison Office in Hong Kong, official spokespeople for both the Chinese Foreign Ministry and the Hong Kong and Macau Office of the State Council employed Xi’s “touching the bottom line” in describing the protests. Carrie Lam used the same phrase, also on July 22, as she condemned the protestors during a press briefing. Given the coordinated use of identical language, it is likely that Beijing’s top leaders had issued instructions to disseminate throughout the Party on how to characterize the protests directly following the events of July 21. In the following days and weeks, the CCP’s news and propaganda network also picked up language identical or extremely similar to the language of Xi’s 2017 speech.

 

  • In late August, the Politburo set the date and agenda for the Fourth Plenum of the 19th Central Committee for late October. The full text of the Fourth Plenum’s resolution, released on November 6, contains Beijing’s plan to take control of Hong Kong. It included an unspecified “legal system and enforcement mechanism to safeguard national security” in Hong Kong. At the time, this was interpreted as yet another attempt by Beijing to pressure Hong Kong into passing an NSL. However, in January and February, the CCP appointed loyal Party hardliners to key positions, including the director of the Central Liaison Office and the head of the Hong Kong and Macau Office. Soon thereafter, China announced its decision to impose the new national security law in May 2020.

 

  • Given that the CCP employs plenums to endorse decisions already made by the top leadership, it is only logical that top Chinese leaders had already decided upon an NSL, likely during the meeting of the Politburo on August 30, when the convention of the Plenum was also decided upon. From this we may determine that Chinese leaders had approved an NSL by August 2019, at the very latest. To be sure, to maintain maximum flexibility, the Chinese government did not take the final official step until the opening of the annual session of the National People’s Congress in late May 2020. 

 

Tracing the decision process in the case of China’s NSL for Hong Kong shows that by laying down a set of hardline positions or markers in his speech on July 1, 2017, Xi significantly reduced his room for maneuver after mass protests directly challenging Beijing’s authority erupted in Hong Kong in 2019.  He faced the dilemma of retreating and losing credibility and cracking down and destroying the “one country, two systems.”  At the end, he opted for the latter, most probably because it provided short-term political benefits while its costs – the loss of Chinese international credibility and escalation of tensions with the West – are long-term. 

The Chinese National Security State Emerges from the Shadows to Center Stage

By Tai Ming Cheung, University of California, San Diego

From the recent imposition of the National Security Law in Hong Kong and the construction of fortified islands in the South China Sea, to the reform of civilian national security strategies and a sweeping anti-corruption campaign, Xi Jinping has been unrelenting in his quest to build China’s national security capacity in the face of acute international and domestic challenges. This transformation has profound implications on China’s ability to respond to present and future security threats.

 

  • China is in the process of pivoting from a largely defensive national security state, mainly focused on domestic security, toward a hybrid security state engaged in both defensive and offensive posturing. In addition to border and domestic defense, this plan couples extraterritorial pre-emptive use of force with internal repression and economic mobilization to support the state’s external policies. No single event or shock that triggered China’s move toward pursuing enhanced national security. However, Xi’s ascension to office in late 2012 marked a fundamental shift from the traditional realpolitik perspectives of his predecessor Hu Jintao.

 

  • Organizationally, Xi unveiled both the Central National Security Commission (CNSC) and the Overall National Security Outlook (ONSC) in April 2014. The former reports directly to the Politburo Standing Committee and has been described as the “nerve center” of national security decisions. A high level of secrecy obscures the CNSC’s activities from public view. The ONSC is the overarching national security framework. It couples ideological purification with a repressive national security state, reforms justified by a central premise: China is now faced with internal and external factors unrivaled in their complexity. In this way, Xi reconceptualized national security as a means of combating non-traditional, political, and emerging threats, thus necessitating a new national security approach.

 

  • The motivating factors include both threats and opportunities. The three threats are: 1) Invasion, subversion, and splittism, which include disputes in the South and East China Seas and unrest in Tibet and Xinjiang; 2) disturbances to reform, development, and stability processes, such as issues of unemployment, social inequality, and corruption; and 3) disturbance to China’s socialist system, including domestic authority. This is the ultimate concern of CCP leaders, who perceive domestic and international forces (particularly western constitutional democracy) pushing for regime change. The three opportunities include 1) China’s uniquely rapid rise to global power and its disruption of the global economic status quo; 2) the renewal of the Chinese nation due to the central role of the CCP; and 3) China’s unprecedented capabilities and confidence in soon achieving great power status. However, the leadership recognizes that these opportunities are ephemeral, necessitating the quick adoption of an assertive national security posture to respond to the aforementioned threats.

 

  • Short-term results: a comprehensive anti-corruption campaign within public offices; a political discipline campaign to investigate senior Party members; an overhaul of the civilian national security apparatus; full reform of the military high command; and the 2015 passing of a National Security Law (NSL), which encompasses all conceivable elements of state security, from energy, food, and nuclear security to political, military, ethnic, religious, and even outer space security. The NSL has secured the Party’s grip on power, providing a sweeping legal framework and justification on which to build the new national security state (NSS).

 

  • The Chinese NSS has five main coercive arms: the public security system, which deals with issues ranging from traffic management to cybersecurity; the state security/intelligence and counter-espionage system, composed of the Ministry of State; the People’s Liberation Army, the most politically influential and powerful component of the Chinese NSS; the People’s Armed Police, which Xi recently brought under the domain of the Central Military Commission; and the political-legal system, composed of public and state security and judicial bodies. The NSS’s far-reaching scope has enabled it to proactively prevent security threats in a way previously impossible, realizing Xi’s call to respond to emerging and nontraditional threats.

 

  • Challenges facing the NSS: Despite China’s initial slow response during the first weeks of the virus’s spread, CNSC leadership has applauded the national security state’s capacity at dealing with the pandemic, crediting its highly centralized and coordinated leadership system. These assets are, and will continue to be, crucial in dealing with the prolonged US-China struggle. Given the crisis’s increasingly all-encompassing nature, Xi’s integrated, holistic, and centralized approach to national security will work in Beijing’s favor.

 

In the years ahead, the national security state will increasingly be centralized as Xi continues to place himself at the core of critical NSS bodies and mechanisms. However, given that Xi has, for the most part, appointed political allies rather than seasoned national security experts to senior NSS positions, the longevity of China’s NSS in a post-Xi world remains questionable.

The Saohei Campaign, Protection Umbrellas, and China’s Changing Political-Legal Apparatus

Sheena Chestnut Greitens, University of Texas at Austin

 Xi Jinping launched a campaign called the “Crack Down on Underworld Forces” (saohei) in 2018. The three-year crackdown has significantly impacted China’s internal security apparatus (known as the political-legal system).

 

  • Targets of the campaign: criminals and “protection umbrellas,” or members of the law-enforcement apparatus who harbor individual criminals or organized crime networks. Saohei aims to investigate and punish all criminal and governmental actors involved in protection schemes, thus cleansing the party at the grassroots level. The CCP rolled out the saohei campaign rapidly. In under two weeks after the CCP’s initial announcement in late January 2018, four administrative and judicial departments released regulations for the campaign. By the close of 2018, over twenty other departments had announced their own specific guidelines for saohei, including those that wield authority over core industries, reflecting the comprehensive and far-reaching nature of the campaign.

 

  • Who’s leading the crackdown: The campaign’s main coordinating body, the National Saohei Office, is headed by Chen Yixin, the secretary-general of the Central Political and Legal Commission (CPLC) and close Xi associate, while the National Leading Small Group for the Saohei Campaign is headed by Guo Shenkun, head of the CPLC. The campaign was divided into three, year-long stages, with each year targeting a set geographical location.

 

  • Scope of the crackdown: the campaign’s first round covered Hebei, Shanxi, Liaoning, Fujian, Shandong, Henan, Hubei, Guangdong, Chongqing, and Sichuan. This year-long period reportedly eradicated nearly 100 criminal groups and investigated almost 1800 corruption and protection umbrella cases.  A report released by the Supreme People’s Procuratorate (SPP) in March 2019 reported that it authorized the arrests of 11,183 people suspected of gang-related crimes. The second round, which began in April 2019, covered Tianjin, Jilin, Zhejiang, Anhui, Jiangxi, Hunan, Guangxi, Hainan, Guizhou, Yunnan, Xinjiang, Beijing, Shanxi, Heilongjiang, Inner Mongolia, Shanghai, Jiangsu, Qinghai, Gansu, Tibet, and Ningxia. Official media reported an increase in prosecutions for involvement in protection umbrellas; another SPP report released in May 2020 lists 30,547 prosecutions for gang-related activities, 67,689 prosecutions for criminal activity, and 1385 prosecutions for actors involved in protection umbrellas. Data for 2020, the campaign’s third and final full year, are not yet available. However, preliminary data on the first six months of 2020 reflects further expansion of the campaign’s breadth.  Among those investigated and punished were 13 provincial- and ministerial-level cadres, over 13,000 department/bureau-level cadres, 9,000 country/department cadres, 33,000 township/department cadres, and 39,000 general cadres. This data reflects the campaign’s focus on low-level government workers and bodies.

 

  • A new campaign is looming: Although the Saohei campaign is set to conclude in early 2021, its leaders have already announced a new “education and rectification” campaign to follow in its wake. The new campaign has four major goals: root out disloyal and dishonest party members, implement greater supervision over enforcement and judicial bodies, promote model examples of law enforcement officials, and expand the ability and capacity of law enforcement agencies and individuals.

 

A rectification campaign so all-encompassing of the political-legal system has not yet been implemented during the post-Mao era, suggesting Xi’s intention to consolidate personal power and purge rivals from party ranks. Although this forthcoming education and rectification campaign will target the lower ranks of the political-legal apparatus, it will complement Xi’s recent successes in replacing top political-legal leaders, such as the minister of Justice and deputy minister of Public Security, with his own personal associates.

China’s Economy Bounces Back, But to Which Growth Path?

By David Dollar, The Brookings Institution

Managing the COVID-19 Pandemic Part II: The International Dimension

Michael Swaine, The Carnegie Endowment for International Peace

Quarterly digests written by Genevieve Collins

Although China is leading the pack in its economic recovery, its road to recovery is not a simple reversion to the old ways and tactics.

 

  • Immediate impact of COVID-19: The Chinese economy came to an abrupt halt after the country imposed strict lockdown measures in February. An independently calculated index from Yicai Global tells us that GDP growth was normal in January but substantially declined in February to a rate nearly –20% compared to the growth rate of February 2019. GDP growth recovered slightly in March but was still negative. The Yicai Index determined a –6.7 growth rate for the first quarter, followed by –4.4% in April, 0.6% in May, and 1.4% in June, reflecting a slow but steady return to positive growth. However, growth was, and continues to be, uneven across and within sectors. The manufacturing sector experienced a good month of exports in April, likely because of pent-up demand, especially for medical equipment and supplies. However, manufacturing and exports experienced a downturn in May and June, while non-manufacturing sectors started to recover. The auto industry is experiencing a small surge in demand, while air and rail travel have both sharply contracted. Hospitality and entertainment services also hit a downturn and have yet to recover, while delivery services have experienced substantial growth. Moreover, the boom in construction is a reflection of the housing market’s successful recovery, as well as the government’s effective stimulation of infrastructure projects.

 

  • Projections: China will likely experience a low but positive growth rate for 2020, with various forecasts ranging from 1.0% to 2.5%. Compare this to the projected –8% growth rate for the US. Moreover, China will likely experience healthy positive growth in 2021, as the IMF forecasts 8.2%. The US, by comparison, is projected to rebound by 4.5% in 2021.

 

  • More US-China decoupling:  The first and most immediately felt long-term change is China’s decreasing dependency on exports. Prolonged economic weakness among importing countries means that China cannot rely on exports to spur immediate recovery. This issue is closely related to the US-China trade war. Although China and the US negotiated a deal in January 2020 requiring China to purchase an additional $200 billion of US goods and services, this is an impossible goal to meet. Most economists do not see the deal surviving for two years. This will likely necessitate greater economic de-coupling between the two countries. China is pursuing enhanced ties with European, Asian, and African states. China has already started this process by signing on to the Regional Comprehensive Economic Program (RCEP), a free-trade agreement among the ASEAN states, China, South Korea, Japan, Australia, and New Zealand. This deal will largely, though not entirely, offset the drop in world incomes caused by the US-China trade war.

 

  • Financial reform needed: The current state-owned, bank-dominated system worked well during China’s export-growth phase in the 1990s and 2000s. But now, with growth dependent on productivity and innovation, the present system is proving inefficient and stagnant. Moreover, the presence of high leverage in the economy prior to the onset of the pandemic put China in a weak position to stimulate the economy. Compared the US’s fiscal stimulus of about 10% of its GDP, China’s response amounts to only 5%.  China needs to open up its market to international banks and institutions, make interest rates more flexible, and de-bureaucratize the process of stock and bond financing for firms.

  • Social safety net needs strengthening: COVID-19 has exposed the weakness in China’s social safety net, especially for the nearly 300 million migrant workers. The vast majority work in urban areas but are registered through the hukou system in rural locales, meaning social benefits do not move with them. As such, about 200 million of these workers do not have access to public health and education services or pensions. Another issue is China’s aging population. By 2049, the population over the age of 65 will double to 400 million. The lacking health systems in rural parts of the country where most of this aging population resides will become all the more strained. Because of these reasons and the drop in private consumption due to the pandemic, now is the ideal time to abandon the hukou system, allowing migrant works to access pensions, health insurance, and education where they work.

 

Although China is leading the world in its economic revival, a quick “V-shaped” recovery is neither attainable nor advantageous. The pandemic has made even clearer the threats faced by the Chinese financial system. Implementing reforms to both the financial and social systems would advance China’s efforts in the long run.

China’s international COVID-19 strategy consisted of three elements: 1) China’s willingness to work with the international community through diplomacy, bilateral and multilateral efforts, and propaganda; 2) defending against foreign criticism of China’s lacking domestic response in early 2020; and 3) in rebutting such criticism, Beijing has attempted to prove the superiority of China’s political system over western democracies, such as the US.

 

  • Charm offensive: Beijing launched a comprehensive campaign to fight the global spread of the virus through open contact with foreign leaders, heads of international organizations, scientists, and doctors. By late May, China had sent nearly 30 medical teams around the world and provided assistance to 150 countries and four international organizations. This was in addition to establishing various inter-country best-practices sharing mechanisms and implementing the Debt Service Suspension Initiative for nearly 80 countries. Beijing has also used the opportunity to call for greater international cooperation on global health matters, even proposing a “Health Silk Road.”

 

  • Propaganda blitz: China has unleashed the full power of its news and propaganda apparatus to counter foreign criticisms of its initial poor handling of the pandemic. Various state-run media outlets have detailed the foreign aid and assistance provided by China and the positive responses from recipient countries. Additionally, it has been used to deflect blame for China’s initial mishandling of the virus in the hope of boosting Chinese standing, not only in international eyes but in the mind of the Chinese public. In response to international calls for independent inquiry into the origins of the virus, Chinese officials, including Xi Jinping, have called on the international community to set aside criticism and instead focus on international cooperation. Other officials have rebutted criticism by emphasizing the amount of foreign aid China provided in the wake of the virus’s spread.

 

  • “Wolf Warrior” diplomats: Some Chinese officials have used particularly harsh language or unfounded claims in refuting critics, a relatively new phenomenon termed “Wolf Warrior diplomacy” by Chinese observers. This “Wolf Warrior diplomacy” is a likely reaction to multiple factors: Xi Jinping’s call on Chinese officials to express a “fighting spirit” in response to foreign criticism, China’s growing international clout, a younger and more outspoken generation of Chinese officials, and resentment due to continued attacks on China in the wake of the virus.

 

  • Pot calling kettle black: In rebutting foreign criticism, China has compared its own approach to the failure of many democracies, particularly the US, in coping with the pandemic. In a June speech, Xi Jinping declared that China’s control of the virus “demonstrated the remarkable political advantages of the leadership of the Communist Party and the socialist system of our country.” Various news and propaganda pieces have praised the superior Chinese response in comparison to the failings of multiple western political systems.

 

  • Holding the line on WHO: In response to Trump’s initial decision to suspend WHO funding in light of perceived WHO favoritism toward China, Xi addressed the World Health Assembly on May 18, stressing China’s early cooperation with the WHO and applauding the international organization’s important work. Later in the month, Foreign Minister Wang Yi reiterated that the WHO does not serve individual country’s interests, even those that provide more funding than others (a subtle jab at America). However, Washington’s own criticism and defunding of the WHO and baseless attacks of China have undoubtedly damaged America’s international standing, too.

 

In sum, China’s international actions in response to COVID-19 are wide-ranging in their respective successes and errors. Many Chinese-led efforts have contributed to combating the virus abroad, boosting Beijing’s global image in the process. Moreover, state-controlled media has been successful in furthering positive Chinese narratives. However, perhaps the most negative consequences have resulted from increasingly sour relations with the United States.