Wednesday, November 16, 2016

Predictability versus chaos

China and Russia have often been bundled together as representing the single most serious challenge to the West. Without doubt these two states share a number of views on world politics and also have a host of similar interests. But it is where they differ that is more telling about their relationship with the West and the international order in general.

An interesting pattern has been unfolding for the past couple of months. Russia has been betting on growing chaos in the West. It cheered both Brexit and Donald Trump’s US election victory. Russian support for populist forces in Europe can be traced back to the establishment of the Institute for Democracy and Cooperation in Paris in 2008. China, in turn, has been much more cautious. It chose predictability, favouring the United Kingdom remaining in the European Union and tilting towards Hillary Clinton as a slightly better option, even though there were voices in the Chinese debate favouring Trump. If both China and Russia are dissatisfied with the West, why these stark differences?

The short answer is that China has much more to lose from the West’s decline than Russia. The case of the Hinkley Point nuclear power plant is a case in point. Brexit and the resulting change of the British government almost deprived China of its first nuclear power investment in the developed world. Theresa May put her predecessor’s decision on hold, demonstrating reservations towards foreign investment in strategic sectors. We will doubtless have a long wait before we learn whether it was pressure exerted by China that made Ms May reconsider her decision, but the Chinese ambassador’s open letter left little doubt that Beijing would retaliate should London block the investment. Nonetheless, it was highly plausible that China could have suffered losses here. For Russia, Brexit was a clear gain, not least because the EU’s attention was drawn away from the Ukrainian conflict.

The same logic applies to China’s relative preference for Hillary Clinton over Donald Trump. Trump’s anti-free trade rhetoric is aimed directly at China. A trade war could undermine Chinese exports, especially given that the US is the largest external market for China and the biggest source of its trade surplus. Even a possible breakdown of the American system of alliances in East Asia, which would strengthen Beijing’s hand in regional geopolitics, may be expected to bring as many challenges as benefits to Beijing. South Korean elites are already pondering the acquisition of nuclear weapons in the face of a growing North Korean threat. If Trump were to follow through with his threat to dump America’s Asian allies (and it is at least a possibility), other states, such as Japan, could embark on re-militarisation. In the case of Russia, the risks related to the election of Donald Trump are much vaguer and the possible gains are rather far-reaching. The volume of Russian-American trade is negligible, while the chaos which Trump’s election may unleash in the West could help Russia achieve its long-term goal of dividing the trans-Atlantic community.

The Kremlin’s support for European populist, anti-establishment and far-right parties also carries little risk for Russia and offers a number of benefits. Representatives of these movements openly declare support for Putin’s ‘strong leadership’, see Russia as the last barrier against the ‘debasement’ of Europe, and support Russia’s anti-American foreign policy. China, in turn, expressed anxiety about the rise of populist forces as early as the 2014 elections to the European Parliament. Anti-establishment European parties see China’s economic expansion as one of the major culprits for Europe’s economic stagnation and the loss of jobs. The European Commission’s anti-dumping tariffs targeting Chinese steel production are only the first sign of protectionism, which China expects will dominate Europe’s economic policy if far-right and far-left parties seize power.

Putin’s recent speech at the Valdai Club meeting offers some clues with regard to Russia’s policy. It is ready to embrace the anti-globalist movement, stir up discontent and fear against the supranational bureaucrats, global oligarchs, and trans-national companies. The invocation of terms such as ‘a simple man’ and the ‘silent majority’, allegedly disenfranchised by their own elites, portrays Russia as markedly different from the allegedly corrupt Western elites, detached from their own societies. Russia expects to thrive on the potential chaos beyond its borders. Such chaos makes it far easier to blame the outside world for Russia’s own failures and enables the mobilisation of popular support for the Kremlin against the new ‘world disorder’. It also makes it easier for Putin to divide the Western community by cherry-picking potential partners. The Chinese Communist Party, as much as it is able to despise Western democracy, needs the capitalist system to remain in power. China relies on open trade and stable markets, as well as on the growing, or at least not decreasing, wealth of Western consumers. It needs constant Western demand for its goods and capital.

The challenge to the West and its liberal values is real and comes from both Russia and China. It would be a mistake, though, to disregard the differences between the autocrats in Moscow and those in Beijing and to assume that their interests are the same.

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