China Quarterly of International Strategic Studies

This article briefly examines the political and ideological aspects of Western countries’ post-Cold War approach to the world order. The Western triumph in the Cold War is generally attributed to reasons that are largely erroneous. The ongoing crises in international relations reveal structural inconsistencies, which have been present in the United States’ foreign strategy since the collapse of the Soviet Union and have contributed to the subsequent erosion of the global order. The article analyzes the new trends of globalization resulting from the unexpected victory of Donald Trump in the 2016 U.S. presidential election. It concludes that Russia and China have now largely recognized Washington’s failure to establish a unipolar world system and to legitimize it through various political and media mechanisms and techniques. It suggests that it is only through the solidary development that both China and Russia are currently championing with their recent grand integration initiatives that a more successful and sustainable multipolar world benefiting every nation on the planet can be built and maintained.

As protectionism and isolationism rise against globalization, China’s Belt and Road Initiative (BRI) provides strong momentum for advancing the transformation of global governance. First, the BRI strengthens the awareness of building a community of common destiny for mankind and promotes the evolution of epistemology in global governance. Second, it offers more sustainable global public goods, thus improving ethical standards for global governance. Third, the BRI combines the top-down and bottom-up approaches to encourage voluntary actions in global governance. Fourth, the BRI draws on China’s own experience in integrating reform, development and stability, which helps balance the economic, social, ecological, and security dimensions of global governance, so as to foster common development among countries and regions along the routes and ultimately create a new equilibrium between South-South and North-South cooperation. Promoted through consultation to meet the interests of all, the BRI will make both tangible and intangible contributions to the transition of global governance by delivering public goods and enhancing the notion of compatible justice in a deglobalized world.

Since the mid-2010s, global economic integration, as measured by world trade, investment and migration, has come to a standstill. During the global crisis of 2008–2009, the negative demand shock in the advanced West and the drastic trade plunge in the emerging East highlighted the increasing inter-dependency in the global economy. Nevertheless, in the past few years, world trade has been falling; world investment continues to stagnate while slower migration has given rise to elevated global displacement and refugee crises, despite peace time conditions. In the Trump era, the eclipse of the U.S. postwar trading regime is accompanied with the rise of new protectionism that has a historical precedent. While China seeks to promote globalization, the White House is moving from multilateral free trade toward bilateral deficit targeting, despite its ongoing secular rebalancing and associated cyclical fluctuations. Although the first Trump-Xi Summit suggests that there may be more room for policy compromises than initially anticipated, the eclipse of U.S. globalism will make any reconciliation difficult. Nevertheless, the global economy is now amid a secular transition that is characterized by increasing South-to-South trade, investment and migration. In this new era, globalization, responsibility and accountability in the international community can no longer be subject mainly to the interests of major advanced economies. While global economic integration was initiated by advanced economies in the 20th century, it will be completed by emerging economies in the 21st century. The drivers of globalization are moving from the transatlantic axis to China and emerging Asia.

Due to institutional fragmentation and conflicts among various actors, a systematic reform to improve the effectiveness of the global energy governance system has become increasingly urgent. Currently, the Group of Twenty (G20), which consists of the world’s major economies and constitutes 60 percent of global energy trade, is in a good position to remold the global framework for energy governance. The past G20 summit meetings have witnessed more attention and efforts from member-state leaders to address problems associated with global energy. However, most of the discussion has been focused on technical issues rather than a comprehensive review of the whole governance system. In the future, the G20 should take proactive measures to enhance its leadership role and policy innovation in the reform of global energy governance, in order to spur green development of the world. As the largest developing nation, China should tap into the G20 platform to advance the transformation of its domestic and international energy systems.

As China emerges as a global power, it has showed great willingness to remake global development finance by setting up new multilateral financial institutions. The creation of those new institutions represents a marked departure from the existing multilateral development bank (MDB) system. For the first time, the new institutions do not depend on the financial largess of the West. To understand the circumstances that have led China to create these new institutions and the likely consequences, the article first examines the Bretton Woods institutional architecture that was created by the United States when it emerged as the principal global economic superpower in the aftermath of World War II. In the second part, it analyzes the competition between China and the United States in global financial governance given Beijing’s expanding interests and Washington’s declining influence. The article further explores in the third section new opportunities and challenges that the new financial institutions could bring to China, and finally proposes how China could better leverage those new institutions to play a transformative role in promoting its global leadership.

After signing a bilateral free trade agreement with China and joining in the China-led Asian Infrastructure Investment Bank (AIIB), Switzerland has become one of China’s best partners in Europe. The bilateral relationship has been upgraded from “strategic partnership” to “innovative strategic partnership,” and is regarded by the Chinese as “a model relationship for China-European countries.” Two fundamental reasons explain why Switzerland has achieved such harmonious relations with the world’s second largest economy: first, there is no historical conflict between the two countries; second, Switzerland is more pragmatic than other European countries in strengthening bilateral cooperation with China. So far, the two countries have institutionalized dialogues and other exchanges involving both elites and the public; sensitive issues have been properly handled without obstructing the development of their bilateral relations. As ever closer ties are being built between China and Europe as a whole, the Beijing-Bern relationship can serve as a model for other European countries.

Similar to his foreign policy and strategic thinking, President Trump’s South China Sea policy features strong uncertainty. The new president is keen on enhancing U.S. military strength, but often uses “suspense” to achieve better deals on the negotiation table. Whether the practice can be directly linked to the rebalancing strategy is uncertain, but it can be said that the Trump administration is seeking peace through stronger military power, which will exert complex impact on the security situation of the South China Sea as well as the rest of the Asia-Pacific region. President Trump believes that the United States should consolidate its maritime supremacy in the Asia-Pacific, yet seeking confrontation and conflicts is by no means a policy option for the United States to maintain its regional hegemony. In comparison, China’s approach to resolving disputes and the security dilemma with the United States is to seek common ground while shelving disputes. Both countries should try to enhance their mutual understanding on the South China Sea issue for sustainable development of China-U.S. relations.

Before the nuclear agreement with Iran, the Obama administration actively engaged with world powers and trade partners of Iran to strengthen the effectiveness of economic sanctions against Tehran. The role of China as the largest trade partner of Iran and as a veto power in the United Nations Security Council (UNSC) was controversial in this regard. Washington persuaded most of Iran’s trade partners to join in the sanctions and reduce trade with Tehran. But during the same period, China continued and even expanded economic relations with Iran. Reviewing the events through a process-tracing method, this study reveals that the Obama administration implemented a “guarded engagement” strategy to persuade China to join in the sanctions and reduce trade with Tehran. On one hand, the United States accommodated China’s interests and concerns, and engaged and bargained with China; on the other hand, Washington pressured Beijing through different channels such as security threats and economic sanctions. In response, through a soft-balancing strategy, China did not directly oppose the United States, in order to safeguard relations with Washington; and it eventually voted in favor of the UN resolutions after negotiating over the texts. In the meantime, Beijing refrained from voluntary cooperation with Western sanctions and even increased trade with Iran and filled the void to make sanctions abortive and costly, and to prevent U.S. domination over the Middle East. This study concludes that China’s current standing is such that U.S. diplomatic levers, such as bargaining, threats, sanctions, and pressures, are too costly and barely productive in getting Beijing to follow American policies.