China softens tone as trade war deepens

By Silvi writer

* Softliners may have got an upper hand in foreign policy making as Beijing has bucked strong headwind amid trade war.

* “Keeping a low key (tao guang yang hui)” may return as foreign policy doctrine.

* Chief of external propaganda stepped down suddenly for, allegedly, having “overhyped” the country’s power.

As the ongoing trade war with the US is apparently becoming a “chicken game” between Washington and Beijing, China has softened its tone in world affairs as President Xi Jinping said his country would “stay forever a developing country” in last week’s BRICS summit in South Africa.

Xi, who is widely considered a political strongman, rarely makes such soft comment, which goes against “striving for achievement (fen fa you wei)”, the assertive foreign policy doctrine he has been boasting since coming to power six years ago.

This surprising change of tone signals China has bucked a strong headwind brought by the trade war with the US, especially when Beijing found its bargain chips lost as Washington has agreed with the EU on new tariff deals.

Though it’s still uncertain whether China will compromise, or even succumb, to the US presssue, it seems the doves among Beijing’s ruling elites are getting an upper hand versus the strongliners, which may include Xi himself.

Domestically, Jiang Jianguo last week stepped down as the minister of the State Council Information Office, the country’s external propaganda arm, according to the South China Morning Post.

Jiang jianguo

Jiang’s sudden dismissal was, allegedly, because he has “overhyped China’s rise to becoming a great power”, and the image looked “pale and unconvincing” after the US triggered the trade war with China.

China promoted its “Made in China 2025” plan to dominate a range of hi-tech sectors, but that backfired, becoming a focus of the trade war, forince Beijing to play down the ambitions.

These recent changes signal that the ruling elites of the Chinese Communist Party have been rethinking China’s foreign policy doctrine.

Xi might have realised that it’s far too early and premature to ditch, or play down, the dictum of “keeping a low profile (tao guang yang hui)”, which was first raised by Deng Xiaoping and followed by Xi’s predecessors.

Guided by the doctrine of “striving for achievements”, China has been more assertive under Xi. China watchers claim that Beijing now thinks it’s time to re-write international rules.

Five years ago, Xi initiated the ambitious Belt and Road initiative.

He expressed interest to make China play an active role in global governance further affirms his primary agenda of “building a community of common destiny”, during a speech to a gathering of hundreds of political party representatives from different countries in late 2017.

China has also rapidly built up its military power in recent years and has been more active in seeking control of disputed islands in the South China Sea.

But the trade war with the US was like a slap on the face for China’s hardliners.

Xi and his comrades misjudged US President Donald Trump’s determination to fight the trade war. They also failed to build a “united front” with the EU to play against the US. Besides the zero tariff agreement, Brussels also agreed to buy soy beans from the US, making China’s move to increase import tariff on that agricultural product rather teethless.

What is even worse, the trade war has clouded the outlook for the world’s second-largest economy and roiled financial markets. A sharper slowdown in the Chinese economy could fuel job losses which might further leads to social instability, a concern that Beijing has raised.

Economic growth slowed slightly to 6.7 percent in the second quarter – still above the official 2018 growth target of around 6.5 percent.

However, the trade row with Washington, a slowing domestic property market and reduced outbound shipments have sharply increased the risks to China’s economic outlook.

As signs of change have already emerge, it’s now time to see if “keeping a low key (tao guang yang hui)” will return as China’s foreign policy doctrine.

It is “unchanged” that China “is, and, in a longrun, will continue to be in the primary stage of socialism”, as the People’s Daily argues in an editorial on Jul 31.

(End)

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