China’s Response to American-led “Containment and Suppression”
During the period since Beijing’s exit from the COVID-19 lockdown, Chinese leaders’ descriptions of their country’s strategic environment have grown darker. They have organized their diplomacy to seek to break out of an American-led “encirclement.” To do so, they have advanced initiatives to center their country in the international system and to de-center the United States. They have sought to expand China’s influence in regions and on issues that are relatively less contested, while also working to limit the formation of blocs arrayed against them. Chinese officials also have attempted to reduce American pressure on China. While the sum of these efforts may yield results over time, they have not yet reversed or significantly reduced the strategic pressures Beijing now faces.
The tone of China’s official pronouncements about its external environment has grown more pessimistic over the past year. Public projections of triumphalism about time and momentum being on China’s side have given way to warnings about China’s “complex and severe” national security environment.[1] In his work report to the 20th Party Congress in October 2022, President Xi Jinping for the first time dedicated a section to national security, referring to it as “the bedrock of national rejuvenation.”[2] During the period since, Chinese leaders have declared the need for new development patterns to overcome “headwinds” to China’s continued rise.[3]
China’s leaders seem increasingly consumed with confronting perceived obstacles to their country’s rise. In uncharacteristically pointed public comments for a Chinese leader, Xi stated at a panel discussion on the sidelines of the National People’s Congress in March 2023, “Western countries, led by the United States, have implemented all-around containment and suppression of China, which has brought unprecedented severe challenges to the country’s development.”[4] In the face of these challenges, Xi has declared that China can survive by seeking security through struggle but risks perishing if it seeks security through compromise.[5]
A variety of factors likely inform Chinese leaders’ rising emphasis on national security. At a conceptual level, as China expert Sheena Chestnut Greitens has argued, Xi appears obsessed with fortifying Beijing’s capacity to guard against challenges to the governing authority of the Chinese Communist Party (CCP).[6] This focus on snuffing out threats has led to purges of political rivals, clampdowns on sectors of the Chinese economy, crackdowns on foreign entities operating inside China, and calls for heightened vigilance against foreign infiltration and manipulation of Chinese society. This preoccupation with guarding against challenges to CCP rule does not stop at the border. It also colors China’s foreign policy by adding a securitized tint to Beijing’s relations with other countries.
Beijing’s insecurities are heightened by China’s economic situation. The predicted post-COVID-19 lockdown economic boom has not materialized. Consumer demand has been weak, exports have been flagging, the property sector remains stuck in doldrums, industrial output has been faltering, and foreign direct investment into China has been declining.[7] Youth unemployment is at record levels.[8] Restrictions on Chinese access to foreign high-technology inputs, such as advanced semiconductor chips, have been tightening. Although there are bright spots in the economy – China’s electric vehicle industry is booming and its clean energy sector is globally dominant – the overall direction is toward a structural slowdown in economic growth.
Externally, Xi’s big bet on Russian President Vladimir Putin is looking less safe. Moscow’s botched invasion of Ukraine has weakened Russia as a useful counterweight against Western pressure. The Wagner Group’s brief rebellion in June 2023 exposed potential vulnerabilities to Russian President Vladimir Putin’s grip on power. Xi’s decision to overlook Russia’s barbarism in Ukraine has come at the expense of China’s relations with Europe. And as the United States and Europe increasingly have converged around policies of de-risking and diversifying supply chains to reduce dependence on China, the material costs of Xi’s bad bet have come into sharper focus.
Beijing also has been on edge about America’s efforts to expand networks of partners in Asia and beyond, which it views as being aimed at constraining China. Beijing sees partnerships, such as the Australia-United Kingdom-United States (AUKUS) accord, the Australia-India-Japan-United States “Quadrilateral Grouping,” and the Japan-Republic of Korea-United States trilateral mechanism, as hemming China in and limiting its freedom of maneuver.
In response, China’s leaders have become more active on the world stage since the lifting of the COVID-19 lockdown in December 2022. As shown in Figure 1, China’s frequency of leader-level engagements in foreign affairs increased in the six months after the lifting of the COVID-19 restrictions in comparison to the six months before the emergence of COVID-19.
Figure 1: Pre- and Post-Pandemic Diplomatic Outreach by Top Chinese Leaders
Source: Data obtained from the Ministry of Foreign Affairs of the People's Republic of China. https://www.mfa.gov.cn/web/wjdt_674879/wsrc_674883/index.shtml
Additionally, Chinese leaders appear to have prioritized their distribution of time. As Figure 2 shows, China’s top officials have focused on building relations along their periphery and working to limit the damage to China’s relations with Europe.
Figure 2: Diplomatic Outreach by Top Chinese Leaders (Dec 2022–July 2023).
Source: Data obtained from the Ministry of Foreign Affairs of the People's Republic of China (https://www.fmprc.gov.cn/eng/wjdt_665385/wsrc_665395/).
Nevertheless, according to a senior Chinese scholar who is regularly consulted on policy deliberations, the mood in Beijing is such that China is under hostile pressure from American-led efforts to damage China’s international image and to suppress its rise. Beijing’s goal is to break out of this situation. [9] The remainder of this essay explores how Beijing is trying to accomplish this goal and whether such efforts are bearing fruit.
Centering China in International Architecture while De-centering the United States
Beijing has been advancing three interwoven initiatives that have become the cornerstone of its foreign policy over the past two years – the Global Development Initiative, the Global Security Initiative, and the Global Civilization Initiative. These initiatives appear regularly in speeches and readouts of meetings involving top Chinese officials.[10]
Xi announced the Global Development Initiative at the United Nations General Assembly in 2021.[11] He called for the world to work toward more “balanced, coordinated, and inclusive growth,” which he contrasted with the unequal distribution of benefits from the Western-led approach. In April 2022, Xi rolled out the Global Security Initiative at the Boao Forum.[12] He framed the initiative around China’s support for indivisible, balanced, and sustainable security versus (American-led) efforts to employ alliances and sanctions in pursuit of absolute security. In March 2023, Xi unveiled the Global Civilization Initiative at the CCP Dialogue with World Political Parties.[13] In doing so, Xi called for countries to reject universalist principles and “refrain from imposing their own values and models on others.”
All three initiatives introduced by Xi sought to appeal to the concerns and sensitivities of other developing countries. And they all were framed to provide an unsubtle contrast between China’s benevolence and America’s bullying and willingness to trample on others’ cultures and interests in pursuit of preserving its primacy.
Beyond drawing a contrast with the United States, the concrete goals and resources devoted to these initiatives remain unclear. In this respect, the early period of these initiatives bears similarities to the roll-out of the Belt and Road Initiative (BRI). In its first two years, the BRI also was dismissed as a slogan in search of a strategy. Nevertheless, over time, these three initiatives may mature to serve a few functions that Beijing considers valuable, much as the BRI has done.
First, the initiatives offer an opportunity to promote a China-centric set of principles for governing global challenges while avoiding direct confrontation with the United States. Second, they offer China a less expensive alternative for remaining visible overseas than by continuing to fund large infrastructure projects through the BRI at a time when China’s national debt levels are rising.
Beijing also is working to elevate the importance of groupings in which it has membership and Washington does not. This includes the Brazil-Russia-India-China-South Africa (BRICS) grouping. Beijing would like to see the BRICS expand and serve as an economic and political force that can counterbalance the Western-dominated G-7 grouping. Beijing chafes at the strategic weight that the G-7 holds and would like to dilute its influence. Although Beijing secured its goal in expanding the membership of BRICS at the grouping’s annual summit on August 24, 2023, it remains to be seen whether any substantive impacts will result from the symbolic step of inviting more members to join.
Another grouping that Beijing favors and would like to elevate in importance is the Shanghai Cooperation Organization (SCO). The SCO grew with the addition of Iran on July 4, 2023. It also has plans for Belarus to accede to membership, which will expand the geographic reach of the organization.[14] Even so, the SCO will remain limited in its capacity to serve as an anti-Western bloc for several reasons. First, there are significant divisions among existing members, including India and Pakistan, which impede efforts to forge an ambitious agenda. Second, the organization has a weak Secretariat and lacks institutional bureaucratic capacity. Third, multiple American allies and partners are involved as dialogue partners, thus reducing the likelihood of the group taking a hard anti-Western turn. As a result, the SCO will remain more of a talk shop than a Chinese answer to American security partnerships in the region.
Probing for Soft Spots
China’s foreign policy strategy for breaking out of its feeling of encirclement under U.S. and Western pressure is omnidirectional and opportunistic. Beijing is not sequentially attempting to first consolidate a sphere of influence in Asia and then expand its global influence. In fact, Beijing has more room for maneuver outside of Asia, including in Central Asia, Africa, and in specific thematic areas than it does within Asia. These less contested spaces have been a focus of China’s foreign policy over the past year.
Xi convened the inaugural China-Central Asia Summit on May 18-19 in the historic Silk Road terminus of Xi’an. The summit included the leaders of Kazakhstan, Kyrgyzstan, Turkmenistan, Tajikistan, and Uzbekistan. Xi promised billions of dollars in contributions to poverty reduction, food security, and green development. He also urged greater regional connectivity, including in the energy sector.[15] China imports more than two-thirds of its pipeline gas from the region.[16] With Russia increasingly consumed by its invasion of Ukraine, Beijing seems to be exploiting an opening to expand its diplomatic share of the region’s focus and prioritization.
Beijing has made a similar concerted push to deepen its ties with African nations. In so doing, Chinese leaders have pushed a narrative that China and African nations are natural partners based on their shared history of Western repression and their shared development goals. During his annual January trip to the region, former Chinese Foreign Minister Qin Gang stressed that “Africa should be a big stage for international cooperation, not an arena for major-power rivalry.”[17] Likewise, Chinese Ambassador to Guinea-Bissau Guo Ce published an op-ed extolling that “Chinese civilization, Arab civilization, Greek civilization, and African civilization are all shining pearls in the long river of human civilization.” He blamed Western colonization for Africa’s lack of development and contrasted Western countries that “believe their civilization is superior” to China’s “open and inclusive attitude.”[18]
China also has increased its presence in the Middle East while the United States has reduced its role. This is not to suggest that the two powers are engaged in a zero-sum struggle in the Middle East. Both Washington and Beijing have interests in the region that are more complementary than conflictual. Nevertheless, the split-screen of a growing Chinese role alongside a less visible American presence has fed narratives of China’s rising influence.
This narrative was given a boost when China brokered a peace deal between Iran and Saudi Arabia on March 10, 2023. This marked the first occasion in years that China had assumed such a peacemaking role. Former Secretary of State Henry Kissinger described the event as a “substantial change in the strategic situation in the Middle East,” noting that the Saudis were now balancing their security by playing off the United States against China.[19]
Indeed, China has prioritized efforts to deepen relations with Saudi Arabia. China has surpassed the United States as Saudi Arabia’s largest trading partner. Xi made the kingdom his first overseas visit after COVID-19. During the trip, he attended the first China-Arab States Summit and the China-Gulf Cooperation Council Summit, in addition to paying a state visit with Saudi royalty.[20]
China sees significant strategic benefit to deepening ties with the Gulf region. The region possesses deep capital reserves that could be invested in China. China also would like the region to become a market for its high-tech exports. In addition, Beijing will remain dependent upon the region for energy for decades to come.
During the past year, China also has sought to position itself as the indispensable actor to address several critical global challenges. For example, Beijing sought to offset negative perceptions from COVID-19 by selling 1.8 billion doses of COVID vaccines and donating another 328 million doses, primarily to countries in the developing world. China also exported COVID-19 vaccine production technology to countries in Latin America, Africa, the Middle East, South Asia, and Southeast Asia.[21]
China also shifted its approach on overseas infrastructure projects. Largely for financial reasons, it downscaled the BRI and renegotiated or wrote off more than $78 billion in loans.[22] Xi has instructed that overseas development projects become “small and beautiful.” This has led to the emergence of overseas Chinese vocational training programs to teach residents the necessary skills to operate BRI projects. These vocational training projects have been in response to rising local resentment about Chinese firms importing their own workers for BRI projects.[23]
Furthermore China has pushed for a leading role on climate issues. China co-chaired the COP15 summit that produced the Kunming-Montreal Global Biodiversity Framework. This framework, which is the biodiversity equivalent to the Paris climate agreement, aims to address biodiversity loss, restore ecosystems, and protect indigenous rights. It was signed by 190 countries, excluding the United States and the Holy See.[24] China also is the global leader in renewable energy expansion. It has built more solar capacity than the rest of the world combined and leads the world in wind generation production.[25] Though as the world’s largest emitter of carbon dioxide emissions with its continuing addiction to coal-fired power plants, China’s climate record remains mixed.[26]
Countering Anti-China Bloc Formation
Based on discussions in various track-2 fora with Chinese scholars from January–July 2023, Beijing is frustrated by America’s progress in deepening alliances and partnerships in groupings that it feels are arrayed against China. This feeling took public expression when Chinese officials pushed back against efforts to form “NATO-like military alliances in the Asia-Pacific,” as Chinese Minister of Defense Li Shangfu did at the Shangri-La Dialogue this year.[27]
Chinese scholars have taken the argument a step further, asserting that American animosity toward China threatens the region. For example, Zhao Hai, director of the Foreign Policy Analysis Department at the Chinese Academy of Social Sciences, contends that, “Misrepresentation of China’s actions and intentions are so rampant and entrenched that a new version of ‘Yellow Peril’ plus ‘Red Scare’ is forestalling meaningful and necessary dialogue on the future of regional security arrangements. The animosity against China, dressed up as ideological or systemic rivalry, is deeply rooted in colonial/imperial history and modern racism, which is very much relevant to all Asian nations.”[28]
Beyond rhetorical counterpunches, though, Beijing is targeting outreach to certain American allies to encourage them to hedge for profit. For example, Beijing is pursuing improved relations with Australia following its turnover to a Labor government. Beijing has removed trade restrictions with Canberra and increased purchases of Australian products. It also has reopened high-level communications, including by hosting separate visits by Australia’s foreign and trade ministers and inviting its prime minister to visit China.[29] Beijing likely views Canberra as the most receptive member of the Quad grouping to its efforts to lower tensions and hopes that more productive China-Australia relations will lead Australia to consider China’s concerns as it makes decisions about the future direction of the Quad and AUKUS.
A similar dynamic is at work in Europe. China’s overall strategy with European countries has been to emphasize that China and Europe have no geopolitical conflicts; rather, they share broad common interests. China’s premier, Li Qiang, made his first major international trip to Germany and France, where he encouraged economic convergence over geopolitical rivalry. Xi made similar appeals when he hosted European leaders such as German Chancellor Olaf Sholz, Spanish Prime Minister Pedro Sánchez, and French President Emmanuel Macron in Beijing.
Altogether, Chinese leaders had 38 exchanges with European counterparts in the first half of 2023. This is a significant tempo of engagement that reflects Beijing’s growing prioritization of urging Europe to maintain equidistance between the United States and China and not to align with the United States against China. Beijing is particularly focused on beating back the emergence of any kind of common transatlantic approach toward “de-risking” economic relations with China. According to a well-informed Chinese scholar, Beijing has largely conceded that it has lost traction in Central and Eastern Europe, given Russia’s ongoing violence in Ukraine and its spillover effects on China’s public image. Instead, Beijing is hoping to persuade Germany and France of the benefits of mutually beneficial relations, both by stressing the material gains they could enjoy and by offering Chinese support for Europe’s strategic autonomy.[30]
Even though China’s relations with Russia have become an albatross for China’s efforts to improve relations with Europe, Beijing continues to invest in the relationship. From energy and food supplies to military technology cooperation, Russia remains an important partner for China. Beijing also values the strategic depth that stable China-Russia relations provide. It has offset the economic impacts of Russia’s estrangement with the West since its invasion of Ukraine by significantly increasing trade with Moscow. China-Russia trade in the first six months of 2023 grew 40.6 percent year-on-year, building upon the 29.3 percent growth in 2022.[31] China and Russia also have conducted joint military exercises in recent months, including joint live-fire naval drills in the East China Sea;[32] joint naval exercises with China, Russia, and South Africa;[33] and joint naval drills with China, Iran, and Russia in the Gulf of Oman.[34]
Slowing Down American Pressure on China
There are no visible indicators that China hopes or expects to improve relations with the United States. Rather, Beijing appears to be seeking to reduce strategic pressure from American technology restrictions and coalition building in the near term as it works to buy time to harden against anticipated further erosion in relations over the longer term.
Senior-level U.S.-China dialogues resumed in June 2023, following a fallow period after the February 2023 incursion of a Chinese spy balloon over American airspace. These Cabinet-level exchanges have appeared straightforward and work like, without producing any resolution of outstanding problems or opening any new areas of bilateral coordination.
Even as Chinese officials attempt to persuade their American counterparts to take their feet off the pedal in what they perceive as intensifying American pressure on China, Beijing is advancing three separate lines of effort to cope with American actions. First, China has lowered tariff rates for the rest of the world, with average tariffs lowered from 8.0 percent in 2018 to 6.5 percent in 2022.[35]
Partially as a result, China’s trade with much of the rest of the world has been growing at a faster rate than that with the United States. For example, in 2022 China’s trade with the European Union grew 5.6 percent, with ASEAN 15 percent, and with its BRI partners 19.4 percent, whereas its trade with the United States grew only 3.7 percent.[36] Chinese trade with the United States accounted for 12 percent of China’s overall trade in 2022, down appreciably from the share in 2012, when America accounted for 17.2 percent of China’s overall trade.[37]
Second, China has been working to increase domestic capacity to produce semiconductor chips. Beijing recognizes that advanced chips sit at the heart of technological innovation. Efforts to spur domestic semiconductor production have taken on increased urgency following American export control restrictions on chokepoint technologies within chip manufacturing supply chains that other key actors, such as Japan and the Netherlands, have signed on to. In addition, Beijing has sought to keep open exports from third party semiconductor producers like South Korea and Taiwan.[38]
Third, Beijing has been developing legal countermeasures against external economic pressures. On June 28, 2023, the National People’s Congress Standing Committee adopted the “Law on Foreign Relations,” which enshrines China’s right to take “restrictive measures against acts that endanger its sovereignty, national security and development interests.”[39] In practice, this law merely codifies a retaliatory function that Beijing already had and has been exercising. Nevertheless, passage of this law likely was intended to support a narrative outside of China that Beijing has diminishing tolerance for taking punches without throwing counterpunches.
How is Beijing’s Approach Working?
Chinese policymakers have reason to feel a bit embattled by the outside world. The country’s external environment has grown more “complex and severe” over the past year. China’s relations with much of the developed world have become strained and its image in these countries has deteriorated.[40] Russia increasingly is looking like a strategic liability for China’s efforts to limit trans-Atlantic convergence. U.S.-China relations remain fraught and with few signs of thawing. The country is struggling to attract foreign direct investment from the West for the first time in decades. China also faces heightened tensions with some of its neighbors.
To be fair, Chinese leaders remain capable of telling themselves a positive story about their foreign policy. They are cooling tensions with Australia. They can remain confident that India will pursue its own interests and will not become entrapped by American strategic designs. Barring a Chinese violation of India’s vital interests, New Delhi’s own ambitions will limit its appetite for confrontation with Beijing given the continuing large power asymmetry between the two countries that favors China. Beijing is working to stabilize relations with key European powers that will play a leading role in setting the continent’s foreign policy. With its dominance of the clean energy sector, China will be an indispensable player in the green energy transition. And Beijing’s healthy ties with much of the developing world will frustrate any American attempts to form a global anti-China coalition to contain the country and limit its rise.
Even so, China’s strategic thinkers are right to be concerned. China’s domestic political imperatives appear to be overriding sound foreign policy judgments. Stridently nationalistic rhetoric by Chinese diplomats often plays well at home but is alienating to foreign audiences.
China’s efforts to intimidate other countries into compliance with its preferences also are showing diminishing returns. When America’s relations with key partners in Asia and Europe are healthy, then those countries are less likely to be swayed by Chinese pressure to bend to Beijing’s will. Chinese leaders may be able to get away with being feared but not loved among countries with higher dependencies on China, but they are less able to do so with developed democratic countries that are less dependent on China for their safety and well-being.
Fu Mengzi, vice president of the Ministry of State Security–affiliated think tank, the China Institutes of Contemporary International Relations (CICIR), has examined the limits of China’s economic leverage. He concludes, “Economic relations have not resulted in a moderating influence on political relations. On the contrary, political, cultural, and security factors are having an increased impact on economic relations.”[41] In other words, China cannot rely on countries to be guided by economic self-interest alone in their posture on China.
For decades, China was able to benefit from the shadow of the future. The country was seen as the ascendant power for the 21st century. The implication for many countries was that it would be costly and dangerous to be on the wrong side of Beijing. Now, China’s unbroken and unchallenged ascent appears less assured. The country’s structural challenges are more visible. So, too, is Xi’s determination to prioritize security above development, even when it comes at the expense of China’s economic vitality. China may very well lift itself out of its current slowdown and return to rapid growth. It has done so before.
In fact, Xi has navigated through two somewhat analogous confidence deficits during his time in power. The first was around the time of his assumption of the presidency in 2012 when there were visible fissures at the top of the Chinese Communist Party, boiling public resentment over official corruption, tense civil-military relations, and a complex external environment as America “pivoted to Asia” and the Arab Spring unfolded. Then, in 2015, Xi faced a sharp economic downturn, capital flight, and questions about the country’s economic stability. In both instances, Xi’s instincts were to seek to calm tensions with the United States and with other countries along China’s periphery to concentrate on stabilizing the situation at home.
In the years since, China’s foreign policy has become more hard-edged, as seen in China’s increasingly militarized push to assert control of contested territory in the East and South China Seas, in the Himalayas, and in Taiwan. Beijing has embarked on a massive nuclear and conventional military build-up. It also has grown less restrained in directly criticizing the United States and supporting Russia.