Can a Microscopic Bug Wipe Out China’s Economic Gains?

Nothing is worse for the prestige of a Chinese leader than experiencing uncontrolled chaos in the country he normally rules with an authoritarian fist. The 2019 novel coronavirus, now dubbed COVID-19 by WHO, may be just what the doctor ordered to loosen President Xi Jinping’s iron grip on the Chinese population. It also may help relax the stranglehold Beijing has over its third world trading partners who now are heavily indebted due to China’s Belt and Road Initiative. But, is it good for Xi’s legacy?

In typical Chinese style the government, led by Xi, failed to alert the public and the international community to the severity of the virus’ impact on a large proportion of the Chinese population. Known as “point prevalence,” epidemiologists believe President Xi knew the high proportion of the population infected and dying long before he publicly admitted its impact. Like many dictatorships, the free flow of information is constrained in China. It took well over a month, until after the Chinese New Year on January 25, for Xi to publicly announce a new high-level coordinating body within the Chinese Communist Party (CCP) designated to look into the virus. What is significant about the “Central Leading Small Group for Work to Counter the New Corona Infection Pneumonia Epidemic” (CLSG) body is not its long name, but the person designated by President Xi to lead it.

To insulate himself from condemnation in the handling of the epidemic and its economic impact, Xi delegated State Council Premier Li Keqiang, #2 in the CCP, as head of the CLSG. Xi recently met with WHO officials to discuss the virus, which will give him bragging rights should the epidemic be resolved quickly with good results. But, if China fails to contain its spread and the death rate climbs, he has Premier Li to blame. The COVID-19 is proving to be the greatest challenge facing the CCP and Xi since he assumed office in 2012.

In a more unusual move, the state media organs have given the CLSG a very public role. Formal members of the group have been identified in the news and the government has attempted to portray its response now as very energetic. Despite the late-mounted attempts to get ahead of it, Xi has conceded that COVID-19 has challenged his ability to “uphold stability” in the society. By ignoring the truth, maintaining secrecy at the start, and allowing factions within the CCP to impact efforts to counter the virus, Xi has weakened his position as leader of China, at a time when he is attempting to take on the role of an important world leader.

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During the last four weeks cargo ships have sat idle in harbors off the Chinese coast, laden with commodities and restricted from moving. Oil purchases have declined steeply, too, as factories are closed and demand for crude in China’s refineries is scaled back. Government attempts to shore up the domestic economy are making China’s hopes for achieving its ambitious Ten-Year Economic Plan less likely than before, as achieving a 6.2% growth rate in the coming year is now almost out of the question.

Many analysts suggest that China’s recovery from the COVID-19 will be longer and pale in comparison to the country’s recovery from the 2003 SARS epidemic or the 2012 MERS outbreak. The new virus already has resulted in more deaths than SARS and MERS. It is proving to be a test of solidarity for China as it reclassifies how it counts the virus’ victims and the numbers continue to grow. President Xi may be forced to slow his economic reform program as the impact on the domestic economy in China and, to a less degree, on world trade is stressing the limits of what China can do even after declaring a “People’s War” on COVID-19.

DARIA NOVAK served in the United States State Department during the Reagan Administration, and currently is on the Board of the American Analysis of News and Media Inc., which publishes usagovpolicy.com and the New York Analysis of Policy and Government. Each Saturday, she presents key updates on U.S. foreign policy from the State Department.

Illustration: Pixabay

Quick Analysis

Putin’s Saber Rattling

Earlier this week, President Biden reversed his 2022 decision, authorizing the provision of antipersonnel land mines to the Ukrainian government. It follows an earlier Administration authorization to allow the use of an advanced American missile system capable of striking as deep as 100 miles inside Russian territory. The US election season may be ending, but both Russia and the West show no indication of stepping down the conflict. Russian propaganda continues to swell as the Kremlin increases its threats to use nuclear weapons against the West. Last week Andrey Sushentsov, program director of the pro-Kremlin think tank Valdai Discussion Club (VDC), published an article on growing nuclear tensions in the region. Official Russian language in the last few years has been threatening. Since the US election, rhetoric like that in the Sushentsov article, has approached the level of nuclear blackmail. The VDC article’s main theme centers on Russia’s intent to directly confront the West militarily if the North Atlantic Treaty Organization (NATO) becomes involved in Russia’s conflict with Ukraine. “On the one hand, these threats are intended to frighten the West, but on the other, Russian propagandists themselves are starting to believe in the inevitability of escalation,” according to Ksenia Kirillova of the Jamestown Foundation. On November 11, Sushentsov wrote that “The conflict will reach a completely new level, with unpredictable consequences for Europe and the entire world.” Kirillova points out that Putin’s distorted image of the world is divorced from reality and is causing the Kremlin to issue demands that are impossible to fulfill. Financial and other Russian resources needed to support Putin’s war are growing scarcer at the same time. This week the Kremlin announced a reduction of payments to its soldiers. Recently North Korea acknowledged it was sending soldiers to fight in Ukraine as Putin is running out of bodies to use as cannon fire. The war is not going well for Russia. One question floating around the Washington intelligence community is whether Putin will act out of desperation before President-elect Trump assumes office. In recent months the Russian propaganda machine is spewing out materials from fairly reputable analytical platforms inside the country. Kirillova says that “Kremlin ‘experts’ do not conceal that such threats are only intended to break the West psychologically, as they themselves are not prepared for full-scale nuclear war.” Despite Russia’s lack of preparation for an all-out war with the West, the expanding nuclear rhetoric carries with it an increase in the threat of a full-scale war in multiple theaters of operation. In June 2023 a founder of the Russian Council on Foreign and Defense Policy, Sergey Karaganov, called for “delivering a pre-emptive strike of retaliation” on Poland to force the West to surrender. In the previous month, Dmitry Suslov, a direct of research programs at the policy center proposed organizing “a demonstration nuclear explosion” aimed at intimidating the West. In September, President Putin announced a reappraisal of Russian nuclear doctrine after speaking earlier in the year at the plenary session of the St. Petersburg International Economic Forum and jokingly calling Suslov a “scary person.” Pavel Baev, writing in the European Daily Monitor, says “Putin intends his announcement to mark an escalation of nuclear brinkmanship and influence the proceedings of future Ukrainian peace efforts.” Putin is expanding the list of environmental conditions that are acceptable for using a nuclear weapon and incorporating it into Russian military doctrine. Baev adds that “The ups and downs of Russian brinkmanship are disconnected from the kinetic battles of the war, correlating instead with Ukrainian peace offensives, such as Ukrainian President Volodymyr Zelenskyy’s first peace summit in Bürgenstock, Switzerland.” Despite the increase in vitriolic language, in a You Tube video published a week before the US presidential election, Karaganov openly assured the West the primary goal of the escalation is to break the American spirit and that of the West, not outright nuclear war. By Election Day in the US, with political prognosticators predicting a win for former president Trump, Karaganov changed his tune and called for an increased role in nuclear deterrence. Kirillova points out that Western concessions to Russia are unlikely to reduce the risk of nuclear escalation. The distorted reality inside the Kremlin continues to push that President-elect Trump is an adherent of “world government,” that Ukraine will create a nuclear weapon, and Russia must prepare for a nuclear conflagration to achieve its ambitions for a new world order. President-elect Trump has indicated he will not agree to concessions that destabilize Europe, the Middle East or other regions. Going forward a strong US foreign policy may be the most stabilizing course the West can count on to restrain Putin and his intent to rebuild the Russian empire. Daria Novak served in the U.S. State Dept. Illustration: Pixabay

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