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Although attention is riveted on Russia as the
main adversary of the West, China is developing into a more serious
long-term threat. Russia is a revisionist aggressor trying to
subvert the transatlantic world but its capabilities will steadily
decline. In stark contrast, China is a genuine global competitor
with a strong economy and a durable strategy designed to surpass
Europe and America.
China’s growing influence is based primarily on
its focus on foreign investment, trade, and development assistance.
Russia is a minor player in geoeconomics, apart from its supplies of
fossil fuels. China has become the key rival for the United States
in a sphere where global leadership is ultimately decided. It has
the world’s second-largest economy and its per capita Gross Domestic
Product (GDP) is projected to grow faster than that of the United
States. China is also the largest exporter and second-largest
importer of goods.
China’s expanding global clout is not dependent on
military power but on economic penetration. It is steadily
displacing the United States as the leading trading partner in a
number of markets. Beijing is also intent on becoming a leader in
advanced technology and higher-end industry.
The Chinese regime has no design to impose its
system of government on targeted states but to change global
standards for trade and investment that will favor Beijing over its
competitors. China’s global ambitions are encapsulated in its Belt
and Road Initiative (BRI), involving more than 20 countries and
aimed at developing land and sea corridors linking China with
Central Asia, the Middle East, and Europe. Unlike Russia’s failing
Eurasian Economic Union, China’s Eurasian ambitions are backed by
substantial resources.
Beijing is steadily increasing its investments in
many BRI countries and seeks to set global regulatory standards that
will bestow advantages to Chinese enterprises and undermine the
principles of free trade. Beijing has selected investment targets
that are viewed as politically profitable inroads into the EU and
has bought or invested in assets amounting to at least $318 billion
over the past decade.
State-owned Chinese companies have purchased cargo
terminals in the Mediterranean Sea and the Atlantic rim and control
about a tenth of European port capacity. China is also financing the
building of roads and railways throughout South East Europe. This
forms part of Beijing’s plans to link China with Europe by sea,
road, rail, and pipeline, and also a means to exert political
influence.
In exchange for economic investments, Beijing
seeks diplomatic support for its policies or to neutralize
criticisms in international institutions. Its investments in the
Greek port of Piraeus help ensure that Athens dilutes EU
condemnations of China’s human rights record and its ambitions in
the South China Sea. This formula is repeated across Europe with
Beijing aiming to divide Europe from the U.S. and prevent the
emergence of an anti-China front. In 2012, China initiated the
“16+1” project with 16 countries from Central-East Europe (CEE).
Hungary appears to be the biggest beneficiary - according to
official statistics total Chinese investment in the country has
reached $3.5 billion. Budapest has also vetoed EU motions condemning
Beijing’s violations of human rights.
The EU introduced a mechanism for screening
foreign investment and declared China a "systemic rival" and
"strategic competitor." However, Beijing’s offers to boost local
economies are difficult to resist, particularly by relatively poor
countries along the BRI route in search of capital. China’s
geoeconomic strategy offers substantial financing but without the
regulatory and legal standards on which Western institutions insist.
Washington and its Western partners will need to
implement policies that can contain Chinese influence but without
damaging the economic development of BRI countries. They need to
boost Western competitiveness in foreign markets while ensuring that
China’s investments adhere to international standards and do not
push governments into becoming permanent debtors.
With more solid economic foundations, China also
presents a military challenge in East Asia and is steadily evolving
into a global power. It is the second largest military spender with
the world’s largest army and its military potential is projected to
surpass Russia in the coming decade and become a direct threat to
U.S. interests. The range and capabilities of the Chinese air force
and navy are rapidly expanding. Beijing is pursuing extensive
military modernization with advanced weapons systems and developing
next-generation technologies. China is also modernizing and adding
new capabilities to its nuclear forces.
China’s ambitions also drive its intelligence
activities throughout Europe where its spying networks are
expanding. It penetrates the business sectors of Western states and
seeks both industrial secrets and political influence. Beijing has
also developed sophisticated cyber hacking operations and similarly
to Russia it blackmails or bribes vulnerable politicians and
businessmen to favor Chinese geopolitical interests.
Although the Kremlin views China as a strategic
partner that can help weaken the West, China presents a serious
threat to Moscow’s Eurasian aspirations by reorienting Central Asia
and other BRI states away from its orbit and challenging Russia’s
territorial integrity in Siberia and the Far East. As the struggle
between Moscow and Beijing intensifies, Washington will need to
develop a strategy of leverage between these two adversaries that
benefits Western interests.
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