China Hands, Vol. 6, Issue I, 2018-19

China Hands S T O R I E S AND ANAL Y S I S O F C O N T E M P O R A R Y C H I N A

The Ticking Time Bomb of Water Scarcity

C HINA ’S T R I L L I O N DOL L A R S T R A W MA N

Chinese Surveillance and the Dawn of Digital Authoritarianism

Society & Culture p. 54

Features, p. 36

Business & Technology p. 25

DR Y C H INA

E YE S P Y

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EDITOR IN CHIEF Jeffrey Fu, Yale ‘20

MANAGING EDITORS Elaine Wang, Yale ‘20 Amy Cheng, Yale ‘19

CREATIVE DIRECTORS Jenny Yu, SHSID ‘20 Joyce Ho, SHSID ‘20

THEME EDITORS Isabella Cheng, Yale ‘20 Jasmine Gan, Yale-NUS ‘20 Sharon Li, Yale ‘20 William Min, Yale ‘19

ILLUSTRATORS Adelynn Tang, SHSID ’22 Cindy Lee, SHSID ‘22 Emma Quan, RCM ‘18 Irene Chung, SHSID ‘20 Nina Li, SHSID ‘22 Yixiao Zhao, SHSID ‘20

SENIOR EDITOR Yifu Dong, Yale ‘17 COMMUNICATION DIRECTORS Zixing Gu, Yale-NUS ‘20 Sophie Xu, Yale ‘20

2 Cover Illustration by Emma

DESIGNERS Alicia Cai, SHSID ‘21 Calen Weng, SHSID ‘20 Kevin Gu, SHSID ‘20 Kate Liang, SHSID ‘21 Michelle Ding, SHSID ‘21 Peter Ding, SHSID ‘21 Yuyi Tzeng, SHSID ‘22

Table of Contents 4

Words from the Editors

F 5

Features

Politics & Diplomacy

MICHAEL TAN CHRISTIAN FLORES QI HANG CHEN

P 6 9 12 16

NATHAN CHANG

20

JEFFREY FU

25 28 JOE WU 30 ALEX HERKERT 32 SHARON LI SHARON LI

JEFFREY FU 36

45 48 ANGELA LU 50 JACK MORGANJONES 54 JASMINE GAN 58 ZHEYAN NI ZHEYAN NI

25 Under 25: Leaders in US-China Relations

Destroyers and Islands Meritocracy with Chinese Characteristics Paradipolomacy Sounding the Environmental Alarm

Features

Too Crazy, Too Rich?

Business & Technology Eye Spy Blockchain Entangled in Huawei? The Chinese Investment Paradox

Features

China’s Trillion Dollar Straw Man

Society & Culture

Forgotten Fusionist Shadow of Cultural Revolution Evil’s First Soft Touches Dry China A War of Visibility

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WORDS FROM THE EDITORS

Dear Readers, Sir Austen Chamberlain, half-brother of former Prime Minister Neville Chamberlain, once referred to a Chinese curse which took the form of saying, “May you live in interesting times.” We live in interesting times. The foundations of US-China relations are splintering. The delicate webs of global value chains and cross-border investments linking our economies are unravelling. The resulting disruptions are diverting attention from China’s severe internal problems, ranging from debt to environmental destruction. The world needs to wake up. If China’s domestic economic challenges precipitate an economic recession, it would generate devastating ripple effects felt from the commodity-exporting economies at the bottom of the value chain to the financialized economies. If China’s environmental reforms do not succeed, then everything from regional water security to global climate change may be plunged into crisis. China’s problems have global impact, and ignoring that to fixate on strategic competition and geopolitics puts the future of the entire world in jeopardy. That’s why this tenth edition of China Hands is fundamentally introspective, analyzing China’s approaches to environmental policy, technological advancements, and more. Some analysts treat China as a “mystical, ineffable Oriental reality which is claimed to be inaccessible to Western or Eastern minds,” struggling to cram Chinese policy into a framework tenuously based on concepts like “tianxia.” Others ignore Chinese cultural and ideological differences altogether, warning of a “hegemonic sphere of trade, communication, transportation, and security links” furthering China’s “neocolonial designs” based on a realpolitik framework. In the words of Adam Smith, both camps “give up the evidence of their senses to preserve the coherence of the ideas of their imagination.” In doing so, they fuel narratives that polarize public opinion and political thinking instead of fostering compromise and collaboration. We at China Hands believe this is an unproductive way of thinking about China. Oversimplifying problems and painting an entire country with a broad brush can spur rash responses. After all, if the only tool you have is a hammer, every problem looks like a nail. If you feel like a nail, everything looks like a hammer. China Hands is here to remind policymakers in both the US and China that they have more tools than just a hammer, and that they’re only nails if they refuse to move. Our mission at China Hands is to exorcise the ghosts of our imagination and confront China’s problems with a rational, solution-oriented mindset. Fanning the flames of controversy may be exhilarating and intoxicating, but at the end of the day we all live in the same forest, and none of us can predict which way the wind will blow tomorrow. We hope these pieces spark critical but constructive thinking on the challenges that China faces. Moreover, we look forward to hearing your thoughts and contributions in the coming year. We live in interesting times, and I hope future historians will find our generation interesting for how well we handled the daunting challenges of our time.

Yours Truly, Jeffrey Fu EDITOR IN CHIEF

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2019 Features

25 UNDER 25 Leaders in US-China Relations

In 2013, China Hands became the first magazine to honor young individuals for their exceptional contributions to US-China relations and China studies. We are humbled and excited to present the fifth edition of “25 Under 25: Leaders in US-China Relations.” After multiple rounds of selection, honorees were selected for recognition as leaders in US-China relations, notable for their contributions to fields including business, art, journalism, politics, and academia. This year’s editorial board extends our gratitude to our esteemed judge Susan Jakes, who is Editor of ChinaFile, Senior Fellow at Asia Society’s Center on US-China Relations, and recipient of the Henry Luce Public Service Award. Due to circumstances requiring anonymity and security, one honoree has requested that their identity remain private. However, we hope the 24 narratives we are at liberty to share will inspire our readers to think critically about the evolving relationship between the United States and China and to embrace opportunities for cross-cultural collaboration and exchange in their own lives, especially in these troubled and turbulent times. You can find their profiles on our website at:

Alexis Dale-Huang

Amy Zhang

Anthony Comeau

Bohan Phoenix

Christopher Li

Dale MacLean

Daniel Ling

Emma Campbell-Mohn

Hannah Corn

Hao Chen

Jakob Lengacher

Jane Zhang

Jiaqiao Xiang

Josh Tupler

Joy Nuga

Larry Han

Miranda Gottlieb

Preston Lim

Rachel Walker

Sara Andresen

Savannah Billman

Shantanu Banerjee

Shobhit Kumar

Yixin Ren

You can find their full profiles on our website.

CONGRATULATIONS TO OUR HONOREES

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Politics & Diplomacy

D E S T R O Y E R S

A N D

I S L A N D S :

INTERNATIONAL LAW in the SOUTH CHINA SEA Text // Jeffrey Fu Illustration // Adelynn Tang

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n September 30, 2018, a Chinese Luyang-class destroyer cut across the bow of an American destroyer, the USS Decatur, coming within 45 yards of collision before the Decatur maneuvered to avoid catastrophe. Such brazen disregard for maritime safety and American power would have been unthinkable in 1990, when former leader Deng Xiaoping famously called for China to “keep cool-headed [… and] hide our capabilities and bide our time, never try to take the lead.” The near collision occurred in the South China Sea, where China has made contested territorial claims and pursued a program of island-building and militarization. One neighboring

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nation embroiled in the South China Sea territorial dispute, the Philippines, brought an arbitration case against China under Annex VII of the United Nations Convention on the Law of the Sea (UNCLOS) in 2013. By studying the arbitral tribunal’s 2016 ruling and China’s subsequent response, it is possible to develop a historical understanding of why China’s international approach and image are shifting. When the arbitral tribunal was convened, China took the position of “no acceptance, no participation, no recognition, and no implementation,” arguing that the tribunal’s decision is attempting to rule on territorial issues beyond the jurisdiction of UNCLOS.

Indeed, it is difficult to imagine that the Philippines would have initiated arbitration on the status of the specific Chinese-occupied land features in the South China Sea in the absence of a territorial dispute with China. China will clearly still be able to maintain its control over the disputed features by virtue of its greater military and economic capabilities. This means that any tribunal rulings downgrading the status of features would heavily restrict Chinese maritime entitlements in the region, to the benefit of the Philippines. In tandem, these considerations suggest that the purpose of Philippine claims is in fact to decide on territorial issues. This would render the matter beyond

Politics & Diplomacy

the jurisdiction of the tribunal if it were to decide based on the spirit of the law. Instead, the tribunal chose to address this argument by drawing on the letter of the law: it ruled that the specific claims raised by the Philippines did fall under the jurisdiction of the tribunal, regardless of whether conclusions had implications for broader decisions on territorial issues. This first decision signaled the tribunal’s intention to arbitrate the case strictly based on the law and evidence rather than policy and intent. China’s second argument against the tribunal’s legitimacy is grounded in Article 298 of UNCLOS, which allows China to opt out of arbitration on disputes involving “sea boundary delimitation” and “military activities.” If regional maritime features such as Itu Aba are classified as islands, they generate 200 nautical mile exclusive economic zones that overlap with the Philippine exclusive economic zone, creating a dispute that requires sea boundary delimitation

to resolve, and thus restricting the tribunal from ruling on many of the Philippine claims. Similarly, if Chinese construction on the Spratly Islands constitutes military activity, the tribunal cannot award itself jurisdiction over many of the Philippine claims. The tribunal’s ultimate decision that the regional maritime features (including Itu Aba) are not islands (and thus do not generate overlapping exclusive economic zones) and that Chinese activity on the islands were non-military, seem to deviate from the legalist approach the tribunal initially signaled. For a maritime feature to be classified as an island instead of a rock (and therefore to generate an exclusive economic zone), UNCLOS states that the feature must be able to “sustain human habitation” and “economic life” of its own. The tribunal’s ruling that even Itu Aba– the largest and most vibrant of the features–does not constitute an island, raises questions about the justness of the tribunal’s standards. On first glance, the standards

For a maritime feature to be classified as an island instead of a rock, the feature must be able to “sustain human habitation” and “economic life” of its own.

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Due to the failure of international law and the success of bilateral action, China learned in the South China Sea dispute that assertiveness, not humility, may be the key to realizing its territorial ambitions. seem quite reasonable, requiring that the feature be able to sustain “a stable community of people for whom the feature constitutes a home and on which they can remain,” and that economic activity not be “dependent on outside sources or purely extractive in nature without the involvement of a local population.” However, evidence seems to suggest that Itu Aba meets these conditions. Itu Aba has its own freshwater supply and is thus not entirely dependent on desalination facilities, has sustained a population of more than 100 people, produces a variety of agricultural goods including corn, sweet potatoes, mangoes, and guava, has its own hospital and facilities, and even has distinctive diverse flora and fauna. Highly qualified scholars of maritime law such as Noel Ludwig, Robert Beckman, and Clive Schofield generally agree that Itu Aba meets and exceeds the conditions for a feature to be an island and not a rock. The tribunal, in discarding the work of numerous experts and failing to adhere to its own standards, thus made a questionable ruling on Itu Aba that casts its jurisdiction into question. China has not only transformed reefs into artificial islands, it has also constructed military-length airstrips, concrete structures with retractable roofs housing surface-to-air missile batteries, radar facilities, and other military installations on those islands. Satellite images and expert analysis available to the tribunal clearly indicates the military nature of Chinese activities on disputed maritime features. Yet, the tribunal “decided that it would not deem activities to be military in na-

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ture when China itself has repeatedly affirmed the opposite,” as stated in its press release. On this subject, the tribunal used public statements from a state that is not officially participating in proceedings over neutral, concrete evidence to award itself jurisdiction. This is despite the fact that the tribunal had previously indicated a commitment to the letter of the law and evidence-based decision-making and dismissing the intentionality of the involved parties as irrelevant to the tribunal’s jurisdiction. This inconsistent approach again calls into question the impartiality of the tribunal and the rigor of its methodology. When international courts and tribunals decide whether they possess jurisdiction over contentious disputes, they should err on the side of caution to avoid tarnishing their legitimacy and discouraging states from recognizing future rulings. Although it may not be clear whether this is best done by adhering to the letter or spirit of the law, the chosen standard should, at the very least, be consistent throughout the arbitration of a case. The tribunal that arbitrated the South China Sea dispute, despite its reasonable defense of its decisions, has demonstrated troubling inconsistency, especially in its rulings on the status of Itu Aba and Chinese activities in the region. This bolsters China’s fear that international deliberative bodies are driven by Western agendas and incentivizes China to act unilaterally instead of respecting multilateral institutions. In the aftermath of the tribunal’s ruling, China declared the tribunal’s ruling “null and void” and refused to abide by the findings. Instead, China pursued a bilateral solution with the Philippines based on large promises of economic coopera-

tion and investment. Mere months after the tribunal’s ruling, Philippine President Rodrigo Duterte announced his “separation from the United States,” declaring this separation to be in both military affairs and economics, and that “America has lost.” This solution has persisted to the present day, with 29 additional agreements between China and the Philippines being announced on November 21, 2018. In President Duterte’s words, “China is already in possession. [The South China Sea is] now in their hands. So why do we have to create frictions, strong military activity that will prompt response from China?” Due to the failure of international law and the success of bilateral action, China learned in the South China Sea dispute that assertiveness, not humility, may be the key to realizing its territorial ambitions. Consequently, China has continued to militarize islands in the South China Sea and contest American freedom of navigation operations, leading to the confrontation between Chinese and American destroyers. In the microcosm of the South China Sea dispute, it can be observed how the interplay of international law, economic power, and territorial ambition may be transforming China’s disposition from that of Deng’s vision of China as a responsible stakeholder, to Xi’s vision of world power. Unless America can navigate this political quagmire, it is unlikely China will deviate from its path of growing assertiveness or support the liberal international order.

Politics & Diplomacy

MERITOCRACY WITH CHINESE CHARACTERISTICS Text // Michael Tan | Illustration // Irene Chung

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ould a TV-celebrity and real-estate mogul with no political experience whatsoever ever be able to achieve the presidency in China? Such a feat, while possible in the United States, has next to no chance of happening in China, for reasons that lie in the extremely rigorous selection process that the Communist Party of China has for senior government officials. Although this process is decidedly less democratic, there are many reasons to think that it may be more meritocratic. In short, the Chinese political system produces more competent government officials than does the American system. The current Chinese civil service system has deep cultural and historical roots. During China’s millennia-long dynastic period, public service was open to most through the famous imperial civil service examinations, which were in use from as early as the Han Dynasty in the 2nd century and lasted until the 20th century. Ancient exams focused on mastery of Confucian texts, military strategy, civil law, finance, agriculture, geography, and more. Taking the exams would take three full days, with cheating being punishable by death. Historians regard these exams as the first standardized tests based on merit and many credit the longevity and prosperity of Chinese dynasties in part to this system. The modern civil service exam takes after its ancient counterpart. It is a grueling, highly competitive, holistic assessment looking find the qualified people for Chinese government jobs. To take the test, one needs a college diploma at minimum. In 2016, CNN published an insightful report on the civil service examination for the year: “Imagine taking a five-hour exam just to get a job interview. That’s what nearly one million people did in China Sunday, taking the country’s grueling civil service entrance exam, or Guokao. Test-takers had two hours to answer 135 multiple-choice questions on topics covering language, mathematics, logic, politics, law and culture. That was followed by 3 hours of essay questions. The exam is only held once a year, so for those taking part, it’s do or die. They are competing for 27,000 jobs. The odds of getting one – after the exam and a subsequent interview – are about 36 to 1.” The CNN article also includes some sample questions, which are fairly difficult – for those who are curious, here’s a few:

Plato thought that things in a changeable state do not exist. Which of the following statements would a follwer of Plato believe to be the most accurate? A Concept of a horse

B A picture of a human

C A Tree

D The Pythagorean theorem

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Politics & Diplomacy

Arrange these sentences 1. Coal is only an energy reserve, and doesn’t become valuable until it is mined. 2. Being able to fully tap into and use big data -- a huge and unknown treasure -will become the key to transforming and upgrading businesses. 3. Some people have compared big data to coal mines. 4. Data, as a resource, is difficult to value in its “sleep mode,” therefore data mining is needed. 5. Big data is superior to traditional database capabilities in terms of acquisition storage, management, and analysis. 6. Likewise, the key to big data doesn’t live in its existence, but its usage.

A 312546 C 352146

B 543162 D 534612

Two groups of staff at a store are making flowers to decorate the entrance. If group A were to do it alone, it would take them 10 hours to complete the task. If group B were to do it alone, it would take them 15 hours. The groups decided to work together. Group B took a break for 1 hour and 40 minutes. Group A ended up making 300 more flowers than Group B.

How many flowers are there altogether? A 600

B 900

C 1,350

D 1,500

To reiterate, in 2016 China had 1,000,000 people competing for 27,000 jobs. And that’s just to get to the entry level. So to begin with, most government officials all have passed through a highly rigorous and competitive examination process. They are all in the top 3% of test takers. Now we’re at the entry level. The next step is to climb the ladder against all their fellow top 3% test takers. The civil service itself has 27 different ranks. Within each rank officials are graded based on performance and seniority. Within the top 3 ranks are the Politburo, Premier, and President of China. It can take a lifetime of public service to ascend up those 27 ranks. That ladder climbing process is monitored by possibly the most powerful and vast HR apparatus in the world, the Organization Department of the Communist Party. Performance is measured meticulously, and everything is recorded. By the time you get to those top few ranks, you’ll have to have had experience managing provinces that have the populations and GDP of a country like Britain. And you’ll have managed them better than all the other provincial heads in the country. To see this better, let’s look at the example of the current President of China, Xi Jinping. Xi was the son of an original Chinese Communist revolutionary, but he was purged to the rural villages during the Cultural Revolution. He would officially join the Communist Party in 1974, finally being accepted after having his application rejected 10 times. Xi rose through

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Politics & Diplomacy

the ranks quickly, serving in four provinces and eventually becoming Governor of Fujian Province (population: 39 million) and then Party Chief of Zhejiang (population: 54 million). He would be recognized for running Zhejiang exceptionally well, outperforming his fellow provincial officials. Under his tenure, GDP grew at a whopping 14% per year and R&D investment quadrupled. He soon was appointed a member of the Politburo Standing Committee in 2007. After 33 years into his time with the party, Xi finally ascended to the coveted top 3 ranks. He would have to wait another 5 years before becoming President of China. This is just one example of how the Chinese political system optimizes and checks for competence in management and governance to ensure that the best governors eventually govern the country. Contrast this with a more democratic system. For instance, many public servants in a country like the United States are elected, not appointed. This means that the American political system in some ways optimizes for who can get the most votes, which is not the same as competence in governance. A great campaigner or politician and a competent public servant often-

times are not the same thing. In contrast, the Chinese political system keys in on the most relevant factor to being a good public servant — competence, not vote-getting. Becoming a senior government official (or any government official for that matter) in China is no easy task. The civil service system ensures that only tried and true officials can rise. The intensely competitive and meritocratic system ensures that competence is rewarded and that the people at the top are indeed competent. And with President Xi’s recent crackdown on corruption, this system is becoming even more airtight. Only those with real track records of exceptional performance can ever hope to get to the highest levels of the Chinese government. There are no TV personalities running the show in China.

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Politics & Diplomacy

PARADIPLOMACY AND THE HIV/AIDS CRISIS Text // Christian Flores Image//Helloclue|Illustration//YixiaoZhao

How can paradiplomacy help solve the HIV/AIDS epidemic at the Yunnan-Southeast Asian border?

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IV/AIDS has become a prominent issue in China since the 1980s when the disease first entered the country. The spread of HIV/AIDS forced the central government to mobilize and act against a potential crisis that could befall upon Yunnan Province, particularly in the its border region where the epidemic has been exacerbated by drug trafficking and the flow of people. Non-traditional security issues such as HIV/AIDS management have gained wider attention from political scientists to better understand the role that paradiplomacy, or the involvement of subnational governments or organizations in the formation of foreign policy, plays in finding solutions. Appropriately, this article attempts to answer the following question: How can paradiplomacy help solve the HIV/AIDS epidemic at the Yunnan-Southeast Asian border? To answer this question, closer attention should be placed on the way that local governments and non-government organizations (NGOs) strategize and coordinate efforts to tackle public welfare issues. Because this non-traditional security issue is not exclusive to China, this article argues in favor of more efficient coordination between NGOs and local governments to ameliorate the HIV/AIDS epidemic. While making the case for cross-border cooperation, this article attempts to provide recommendations for a better system of management that China may effectively implement in its border region.

NGOs to become the engines behind the formulation of public health policy, extending beyond the borders by attempting to decrease transmission rates and increase public awareness. Moreover, given the movement of people within the region and the cultural connection within the Dai ethnic group in the Southwest border region of China, the border studies dimension is critical in understanding the management of HIV/AIDS. The proximity between Yunnan Province and Southeast Asia has facilitated interaction between China and its neighbors while increasingly facilitating the flow of people.

POSITIONING PARADIPLOMACY: HIV/AIDS IN THE YUNNAN-SOUTHEAST ASIAN BORDER The study of paradiplomacy posits 11 dimensions from which to study the activities of regional governments. For example, the nationalism dimension of paradiplomacy focuses on the nationalistic aspiration of regional multinational and multilingual countries to better understand the formation of diplomacy. In the case of HIV/ AIDS management in the Yunnan-Southeast Asia border region, however, the most fitting dimension from which to study this issue is the border studies dimension, which places a special emphasis on the economic, political, and social transformation within the borders of countries. The spread of HIV/AIDS in China originated in the mid-1980s along the Laotian and Burmese border shared with China, as the country opened its economy to the world. Through its liberal policies that encouraged foreign imports and the intermingling of people in the border region, the trafficking of drugs and the development of the sex industry became the vectors of HIV/AIDS in the region. This led local governments and 12

FIGURE 1 SOURCE: ENZE HAN, 2013

For example, Figure 1 demonstrates the geographical closeness of Xishuangbanna, Yunnan to the Golden Triangle, a region in Southeast Asia where Laos, Thailand, and Myanmar meet. This geographic region, home to one of the largest exporters of opium to the world, has also facilitated the trafficking of drugs into China. The increasing consumption of drugs has created vectors of HIV/AIDS that transmit the virus through risky behavior such as needle-sharing. The transactional nature of the drugs trade makes a strong case for an analysis on the basis of the border studies dimension of paradiplomacy, especially because subnational entities are required to eradicate the consumption of drugs. Thus, the spread of HIV/AIDS is not a public health concern exclusive to

Politics & Diplomacy

China. In other words, China is incapable of stopping the trafficking of drugs into the country single-handedly. Because the border studies dimension focuses on cross-border cooperation of different paradiplomatic channels such as subnational governments and NGOs, this dimension provides the best foundation for the further study of HIV/AIDS along the Yunnan-Southeast Asia border. Moreover, with the change in human vectors and their social positions, challenges in tackling the infectious disease emerge. In the early 1980s, the local government in Yunnan attempted to prevent the spread of this infectious disease by creating policies that rigidly focused on ethnic background. For instance, the local government placed surveillance on the Dai ethnic group in Yunnan as a way of preventing the transmission of HIV/AIDS. The Dai ethnic community stretches along the southwestern border as an enclave in the countries abutting the Golden Triangle. One exemplification of this border-transcending connection within the Dai community is best illustrated by the monks who fled China after the Cultural Revolution and were welcomed by the Dai community in Myanmar and Laos. These same monks then returned to China to re-establish Buddhist institutes in Xishuangbanna. Moreover, despite the different national languages between China and its Southeast Asian neighbors, the Dai ethnic group has maintained its tradition of speaking the Dai language which may also act as a cultural connector among the Dai of different nationalities. Therefore, because of the concentration of the Dai ethnic group in the Southwestern border region and the increasing issue of drug trafficking, the local government took special precautions to enact public health along ethnic backgrounds. The perceived vectors of HIV/AIDS and the populations affected by this infectious disease have transformed over the years. In fact, the rates of HIV/AIDS have been rapidly increasing among men who have sex with men (MSM). This change brings about a challenge that requires a multifaceted method to address the transmission of HIV/AIDS in the Yunnan-South Asian border. Unfortunately, on this front, the central government has failed to effectively solve the increasing problem brought about by HIV/AIDS. Despite providing free antiretroviral treatment for HIV/AIDS patients since 2016, the central government continues to face difficulties in curbing the rapidly increasing transmission rates among the MSM group. In fact, when one looks at the province as a whole, the MSM group has maintained steady transmission rates, therefore making this group the most at risk. Hence, the transformation in vectors of HIV/AIDS demonstrates the importance of using the border studies dimension in studying the management of the infectious disease in Southwestern China. While the study of paradiplomacy has eleven dimensions from which the topic of HIV/AIDS management in the Yunnan-Southeast Asia border, the border studies dimension best accounts for 1) the movement of people along this border and 2) the transformation of viral vectors. THE LOCAL GOVERNMENT AND NGO NEXUS Effective management of the HIV/AIDS epidemic in the Yunnan-Southeast Asian border is complicated by drug trafficking and the change in the populations afflicted by the disease. Drug trafficking has become prevalent along the Chinese border region that touches Laos and Myanmar. In 2005, the number of officially registered drug users in China reached about 1.1 million, and by 2013, that figure rose to about 2.5 million,. The rapid uptick in demand for drugs has increased the drug supply flowing into China through its Southeast Asian border. Heightened drug consumption has sustained a high prevalence rate between 20%-29%, among intravenous drug users (IDU) in Yunnan from 2001-2010. Furthermore, the MSM population has become a larger vector for the transmission of the disease. The prevalence of HIV among the MSM group was about 9.42%-11.78% between the years 2008-2010. Altogether, the high rates of IDU and MSM transmissions demonstrate that HIV/AIDS is still a prevalent issue in Yunnan, despite governmental and non-governmental organizations (NGO) efforts to manage the disease. To tackle the worsening HIV/AIDS epidemic, local governments must undertake a model of governance that allows for improved cooperation with NGOs. Although the 2017 Foreign NGO Law provided local governments with managerial power over these organizations, the Yunnan government can implement a system of performance-based collaboration as an effective mechanism to better fight HIV/AIDS transmissions. A performance-based collaboration is defined as an initiative in which governments provide NGOs with economic and administrative resources if these organizations are deemed able to create a positive impact on the local population. This collaboration system has been

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Politics & Diplomacy

THE ISSUE OF HIV/AIDS REQUIRES LOCAL GOVERNMENTS TO ACT AS FACILITATORS, NOT MANAGERS. 14

implemented by the cities of Shanghai and Ningbo to improve elderly care. In the case of Ningbo, the local government purchased services from the Starlight Nursing Association (SNA) to meet the demand of a growing elderly population. The effective expansion of elderly care achieved by SNA was met with increased resources and assistance from the Ningbo government. This same system can be implemented by local governments along the Yunnan-Southeast Asian border region to increase their localized efforts aimed at decreasing HIV/AIDS transmissions. For example, the Xishuangbanna local government can work with organizations such as Home of the Buddha’s Light, which have historically pushed forward initiatives that include public outreach campaigns to raise awareness and counseling services for patients of HIV. Successful performance by NGOs

Politics & Diplomacy

While a performance-based approach has its merits in creating an effective system of collaboration between local governments and NGOs, the issue of HIV/AIDS requires local governments to act as facilitators, not managers, in the performance-based collaboration system. In other words, by increasing resources available to NGOs such as funding, professional legal networks, and even offices with the appropriate facilities, local governments can incentivize these organizations to accomplish their goal of lowering transmission rates. At the same time, these organizations should also be provided with a degree of autonomy to properly do their jobs. Local governments, acting as facilitators, can help coordinate the organizations that enter the performance-based system and encourage smaller organizations that have a more specific outreach to join the system. With regards to HIV/AIDS, local governments face the challenge of institutional stigmatization which deters patients and atrisk groups from seeking or accessing treatment; this can be ameliorated through the efforts of smaller NGOs.

such as Home of the Buddha’s Light may allow these organizations to provide even medical services. Although Buddhist monks and nuns currently do not receive medical training from public health professionals, the system of performance-based collaboration has the potential to increase the access to treatments that reduce transmissions if monks and nuns had the qualifications to administer antiretroviral or preventative drugs. Because these organizations can effectively localize efforts, i.e. religion-based events, aimed at the predominantly Buddhist regions along the border, NGOs may very well have a larger impact than local government efforts. For example, official testing centers lack the cultural and religious awareness of the population they serve. Therefore, a successful coordination between NGOs and the local government in the border regions of Yunnan Province can potentially help better manage the issue of HIV/AIDS along the Yunnan-Southeast Asian border.

Shanghai Leyi, which cooperates with the Center of Disease Control to prevent hospitals from discriminating against male sex workers, has successfully helped these workers access healthcare and legal counseling. The success of Shanghai Leyi lies in its dissociation from the local government which allows the organization to help sex workers overcome institutional stigmatization. However, Shanghai Leyi has not officially been registered as an NGO and, because of the recent Foreign NGO Law of 2017, may face difficulties in fully implementing its work since large amounts of funding come from foreign entities. Therefore, the role of local governments as facilitators in the performance-based collaborative system is imperative for NGOs like Shanghai Leyi. In the case of the Yunnan-Southeast Asian border region, local governments can help facilitate the job of religious leaders and peer-to-peer workers which have played an important role in battling HIV/AIDS. Feng et al. studies the impact of medical professional training on a Buddhist organization and women’s peer-to-peer group in Xishuangbanna Prefecture. Their training included knowledge on HIV/AIDS and discrimination of patients with HIV, as well as proper condom use. While the Buddhist organizations scored higher in sharing their knowledge of HIV/AIDS after the training, nevertheless, the women’s group scored higher in the promotion of condom use within the community. By helping smaller civic organizations or groups enter the performance-based collaboration system, local governments can help NGOs implement programs that reach out better to the MSM and IDU populations. Lastly, the local governments along the Yunnan-Southeast Asian border region can lower transmission rates by promoting cross-border cooperation between NGOs. Zhang et al. demonstrates the Health Poverty Action (HPA) was successful in lowering the rates of in the border region as a whole by implementing

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a cross-border cooperative relationship with the local Burmese health sector. Through effective management of the program implementation, building trust and cooperation among, and maintaining respect for the local culture as well as encouraging sustainable development, HPA and the local Burmese health sector were able to decrease the cases of malaria entering Yunnan province by 94.5% between 2008-2014. At the same time, the rates of the malaria parasite found in people along the China-Myanmar border region was reduced to less than 5% from about 20%. The promotion of cross-border cooperation along the Yunnan-Southeast Asian border to reduce HIV/AIDS transmissions can be undertaken by an NGO with extensive program management experience like HPA. With increased diagnosis stations, clinics, needle-exchange stations, outreach teams, and treatment centers managed by NGOs under the performance-based collaboration scheme, cross-border cooperation may prove to be effective. Thus, cross-border cooperation between local governments and NGOs in the border region have the potential to address the high rates of HIV/AIDS transmission among IDU and MSM groups. All in all, the empirical evidence demonstrates that the alternative model of combating the high transmission rates of HIV/AIDS among IDU and MSM populations in the Yunnan-Southeast Asian border region has the potential to be successful. The local government should implement a performance-based system to incentivize NGOs to cooperate with the government while carrying out their work. Moreover, the local governments should serve as facilitators for NGOs joining the performance system while providing these organizations with sufficient autonomy. Lastly, the government should encourage cross-border cooperation modeled after the HPA approach to combat malaria, which has proven to be successful.

Politics & Diplomacy

SOUNDING THE ENVIRONMENTAL ALARM ON THE

BELT & ROAD

INITIATIVE

Text // Qi Hang Chen Image // CNBC News and World Coal Association

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hina’s Belt and Road Initiative (BRI) has the prerequisite elements for a massive environmental and climatic disaster. China’s pivot to green domestic policies has obscured the exportation of its environmentally damaging excesses abroad, in what is known as “shadow ecology”. While we must acknowledge China’s efforts to “green” the BRI through legal and economic frameworks, as well as the opportunities that the BRI may generate, particularly in green infrastructure and renewables, it is difficult and irresponsible to overlook its resulting environmental damage that might prove to be too much to mitigate in the future.

CONCLUSION The problem of HIV/AIDS has become of increasing concern to China, specifically along the border regions where drug trafficking, the sex industry, and regular movement of people have created many complications for managing the epidemic. While political scientists attempt to provide various approaches with regards to how to best tackle the issue, this paper places forth an alternate method of managing the infectious disease. The paradiplomatic approach proposed in this paper aims empirically demonstrates how the local government-NGO nexus may very well prove to be successful in the efforts to tackle HIV/AIDS along China’s Yunnan-Southeast Asia border by empirically demonstrating how this method may be successful. The empirical evidence demonstrates that local governments have options to mitigate and better manage the infectious disease. Future researchers should closely follow the development of NGOs in China’s border regions and the change of local politics, as this may affect the way that these organizations approach the management of HIV/AIDS. More importantly, future studies may be able to provide a more quantitative approach to studying the effectiveness of paradiplomacy in the formation of more effective methods of management. This may be useful in better understanding the degree to which certain variables affect the formation of policy to tackle infectious diseases such as HIV/AIDS.

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From an environmental perspective, the BRI is very mixed in terms of risks and benefits; there is no consensus on whether one will outweigh the other. Time is the main factor for this uncertainty. As the BRI was only proposed in 2013, much of what is part of the plan – and what is not – has yet to come. Literature on the BRI is sparse, and often not from peer-reviewed sources, subjecting the little available literature to biases, particularly those coming from within China itself. Additionally, not enough time has elapsed for studies to make meaningful and long-term conclusions. The evolving nature of the project makes it even more difficult to extrapolate into the future. Still, it is imperative to actively consider the environmental risks and costs that are already happening due to the initiation of the BRI, as well as projected costs and risks leveraging given past environmental theories and case studies. A 2018 paper jointly published by the World Wildlife Fund and HSBC provides a useful framework for considering seven different parameters of BRI’s environmental impacts – in terms of the project’s (A) input----

Politics & Diplomacy

----which include (1) ecosystem use, (2) water use, (3) use of other resources, and (B) outputs, which include (4) greenhouse gas (GHG) emissions, (5) non-GHG emissions, (6) water pollutants, and (7) solid waste. An eighth element that should be under consideration as well is the (8) increase in overall population in BRI corridors because of the project, that will compound upon the seven factors. The WWF-HSBC report has set out parameters beyond the conventional wisdom limited to just carbon emissions, to prime the public in thinking more broadly about the environmental impact of the BRI. While this article does not seek to analyze every single parameter, it does aim to invoke the report’s comprehensive and wide-ranging analytical approach to discussing the BRI.

NON-RENEWABLES: THE SHORT-TERM CULPRITS To begin, perhaps the most contentious element of the BRI – and most conventionally scrutinized – is the export of coal-fired power plants to under-electrified, developing BRI partners. In fact, infrastructure and development projects along the BRI will remain predominantly powered by coal-fired plants in the foreseeable future, despite China’s commitment to UN Sustainable Development Goals and the Paris Climate Accord and to a vision of a “green, healthy, intelligent and peaceful Silk Road”. These guidelines are largely non-binding and present no viable punition for a China that wishes to deviate from such a vision. China is already the world’s largest exporter of coal-fired plants, and the BRI will only entrench this status. A Global Environmental Institute report shows that some 240 coal-fired power plants had been built along the BRI by the end of 2016. The immediate impacts are clear: the shadow ecology behind the BRI means that while China pivots sharply towards sustainable

development and green, clean policies domestically, the overall perturbation to planetary systems will not decrease, and in fact, may even increase. China is merely shifting its carbon footprint to other smaller and weaker countries along the BRI, and China’s domestic efforts at going green has not translated into green investments and development abroad. Natural gas and oil, supplementary forms of energy to coal, are also potentially problematic for the environment. One of China’s principal goals for the BRI is to ensure energy security, and its partnership with the Central Asian countries rich in oil and gas resources will mean that it can transport its energy more safely without being vulnerable to controversies in the South China Sea and US hegemony in the area. The building of pipelines in Central Asia has already had effects on local environment; the North Caspian Operating Company, for example, had to replace its pipelines in 2014 due to leaks. China’s BRI has not represented any substantive decoupling from non-renewable energy resources; import of Russian crude oil has doubled from 2012 to 2017.

RENEWABLES: NOT A SILVER BULLET While the opening of coal-fired plants abroad will be the center of controversy, other forms of energy will also have significant environmental impacts. Even renewable energy resources, such as hydroelectric, solar, and wind power, have consequences as well. Hydroelectric energy generation will disrupt aquatic ecosystems, divert rivers, change flows and distribution of water resources, and force relocations. The BRI is already seeing impacts in the Mekong Delta, where dam investments are putting potentially 64 species in danger.

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The production of solar panels is also known for its highly toxic discharge. The perturbations to biotic systems along the BRI from an environmental science perspective seems inevitable. It is merely a matter of how to minimize it, or to make net environmental gains in the long run. To make matters worse, solar and wind power, with their relatively low environmental costs, are also sidelined within the BRI with limited commitment and attention. Once again, this reflects the disconnect between green domestic policies in China and a lack of commitment to hard environmental regulations abroad; China is actually the world’s largest manufacturer of wind turbines and solar panels, but this has not translated into commitment to solar and wind power in the BRI. In the short run, there is unlikely to be a dramatic pivot from coal power to more low-impact renewables.

HIDDEN FEEDBACK LOOPS The BRI has some serious hidden side effects that might be amplified through feedback loops. For one, the increase in economic activities along the BRI will on its own result in faster depletion of available water resources, and the increase in population engendered by prospective economic booms will further exacerbate water scarcity. This is in particular a very real threat in the first stage of the BRI – the Central Asian corridor. Kazakhstan and Mongolia, China’s immediate neighbors, and two important allies in the BRI, are located in an arid geographic region which cannot sustainably

support massive increases in water use, be it for manufacturing and production, energy generation, or human consumption. Many of these activities will also pollute existing water resources beyond the point of sanitary and safe human consumption and support for local ecosystems. This will be particularly problematic from a population perspective – there are already 3 billion people living along the BRI and with the expected economic boom, the number will only increase. Depletion of water resources can also have larger impacts, such as the change in regional climate, diminution of natural habitats, and the disruption of local ecosystems and biodiversity. Apart from environmental impacts specific to localities, the BRI has systemic environmental impacts as well that might also be potentially amplified through positive feedback loops. With increased economic activities comes an increased carbon footprint as studies have shown that there exists a direct correlation between economic growth and carbon dioxide emissions into the atmosphere. One mechanism in which this relationship manifests in is the transportation of goods and services, specifically in emissions from shipping and land transport. Cement production, a key step in the massive infrastructure development scheme that is the BRI, produces large quantities of toxic waste, greenhouse gases, toxic gases, and also requires large amounts of water resources and energy, presumably generated by coal-fired plants. Another mechanism is that with economic growth, consumption of goods and services increase, which results in a larger carbon footprint.

DEFYING CONVENTIONAL WISDOM Some, however, have argued that based on the Environmental Kuznets Curve (EKC), the initial degradation of the environment due to economic growth will be mitigated by future economic growth and development in scientific and technological innovations. Within the environmental scientific community, there is no consensus on whether the EKC will hold true for the BRI, or in general at all, for that matter. As previously discussed, economic growth is positively correlated with environmental degradation, and whether or not the innovations that come along with growth can mitigate the increase in consumption, production and pollution, is unknown. For this reason, there is much anxiety, ambivalence, and ambiguity about the current impacts and future environmental consequences of the BRI. It should also be noted here that the within the environmental science discipline, using carbon dioxide emissions as a proxy for measuring environmental degradation has become almost a predominant paradigm. Discourse, at the very least those on the BRI, tends to have a much more diverse set of dependent variables. For example, disruption of natural habitats and local ecosystems, loss of biodiversity, over-extraction of water resources, land erosion, are also negative perturbations to plan18

Politics & Diplomacy

OPPORTUNITIES ABOUND? CHINA’S WILL AND MIGHT

etary systems that are equally important foci and have been given the appropriate concern and attention. Much attention in recent years, for example, has been given to endangered species threatened by the BRI, such as the Amur Tiger and the Far Eastern Leopards, whose natural habitats are being increasingly fragmented by the construction of railway corridors between China’s Rust Belt in the Northeast and Siberia.

What is certain though, is that risks and benefits will both exist, even if prospects might seem grim in the short run. Potential areas for environmental protection and improvement include sustainable energy infrastructure particularly in solar and wind, better transportation infrastructure, transfer of sustainable development technologies and further development of green financing, as well as increased economic wealth that can facilitate transitions into green education, policies and economies. China’s potential in engendering change is undeniable. Its four major state-owned commercial banks account for 83% of BRI’s financing, while state-owned enterprises (SOEs) account for 52% of construction. Chinese SOEs have great influence and sway over the type of environmental standards to be upheld in BRI projects. Furthermore, China has also shown not merely the capacity to act but also the willingness to act. It is well within Chinese interests to start acting like a global leader on environmental and climate sustainability, to remain not only accountable to its beleaguered domestic population, but also an international community from whom China needs lasting support and adoration from. Since the 2011’s Twelfth Five-Year Plan, China has fully integrated low-carbon and low-pollution strategies into its core economic plan. Chinese leaders prioritize domestic sustainable development to significant results, having already hit 2020 emissions reduction target of 46%. China has voiced strong commitment to international standards, like the Paris Agreements and the UN Sustainable Development Goals. President Xi has also emphasized sustainability and co-prosperity as the key tenets of BRI at the 2017 Belt and Road Forum. China has begun to concretize rhetoric in policy, partially driven by economic interests and international leadership ambitions. In recent years, renewable energy has become more than a normative cause for China, but also a nascent driver of economic growth. By 2012, China accounts for manufacturing 71.4% of the global photovoltaic cell supply, having exported US$8 trillion in solar equipment, partially through the BRI. China has also accounted for some 50% of global solar energy demand. These numbers will only increase as China seeks to further dominate and profit the sunrise industry. China was the largest issuer of green bonds in 2016, directing some US$11.2 billion in funding to sustainable infrastructure development and renewables development, particularly in solar and wind.

GREENING THE BRI: ESG INVESTMENTS AND GREEN FINANCE In recent years, China has placed greater emphasis on ESG– environmental, social and governance – factors within BRI projects. The goals are to reduce costs and identify, value, and de-risk investments, ensuring greater commercial viability for partner countries in the long run. With stringent ESG considerations, BRI infrastructure projects in ASEAN can achieve better bankability for investors and host countries alike. Myanmar’s US$3.6 billion Myitsone Dam, for example, was shut down in 2011 due to backlash over environmental and social concerns, incurring a loss of US$800 million for Chinese stakeholders, and costing Myanmar a renewable energy source, US$18 billion in potential, and in forcible relocations and disruptions to water and ecosystems. The incentives for China to commit to green finance and sustainable development along the BRI are clear – and the incentives are not only Chinese economic benefits, but also to avoid environmental disasters in partner countries with weaker environmental regulations. As a framework meant to increase Chinese reach through the expansion of its soft power and positive influence and image, the BRI becomes immediately self-defeating should smaller, emerging partners along the BRI be environmentally damaged – or at least perceptibly reaping more harm than good. We should sound the alarms on the BRI in the short run, due to the current risks and negative impacts on the environment and climate – and trendlines are indeed worrying. Economics and local domestic needs of BRI partners mean that in the short run, expansion of coal-fired power plants and other damaging technologies will not reverse course. The BRI, however, has also great potential for good. We do not know if these future benefits will outweigh the current risks and costs, or if China will continue signaling goodwill and intent to green the BRI, or go beyond signaling to establishing concrete legal and economic frameworks. What we must not do fundamentally, is to discourage China from doing so – by dismissing the green policy efforts of a rising power concerned with its increasingly negative image as paying mere lip service.

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Features

TOO CRAZY, TOO RICH?

Text // Nathan Chang Image // Google Images

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Features

“But why would I see it just because its cast is all Chinese?” – Xia’an, one-star Douban Reviewer

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razy Rich Asians depicts how Chinese American Rachel Chu (Constance Wu) meets the ultra-rich and elite Singaporean-Chinese family of her boyfriend, Nick Young (Henry Golding). Complete with delectable Asian food and elements of Chinese culture, the film begins as a family visit and wedding for Nick’s best friend. However, it spirals into a cultural clash between Chinese American Rachel and Nick’s Singaporean Chinese mother, Eleanor (Michelle Yeoh). Media outlets, celebrities, and movie-watchers have praised the film as a big step for Asian Americans—and diversity, in general—in Hollywood. The film is the first Hollywood movie to feature a majority Asian and Asian American cast since The Joy Luck Club (1993), and before that, Flower Drum Song (1961). In Chinese diasporic communities outside the US, like Taiwan and Singapore, Crazy Rich Asians has been a box-office hit. By November 2018, the film grossed over $173 million, making it the highest grossing romantic comedy in over ten years, and the sixth best-performing romantic comedy ever. According to Rotten Tomatoes, critics and general audiences have liked the movie, giving it a 92% approval rating. The film’s progress for Asian and Asian American media representation raises the question of why it took 26 years to get to this point after The Joy Luck Club. And why is a blockbuster film with a cast like this an accomplishment at all? Last semester I took a class, “Asian American History, 1800 to the Present,” taught by Yale professor and Timothy Dwight Head of College Mary Lui. In class, we learned that one of the many ways that Asians have experienced marginalization in America is in the performing arts. Even before the rise of Hollywood films, Asian Americans faced a history of caricaturization and discrimination. Racialized portrayals of Asians appeared in yellowface minstrelsy as early as the second half of the 1800s. This type of acting consisted of white actors wearing yellow makeup and dressing as if they were Chinese. In attempting to embody “Chineseness,” white minstrel actors acted as if they ate dogs and rats, spent their days in opium dens, kept long queues (a long braid of hair worn at the back by subjects of the Qing Dynasty), and spoke in pidgin English. The rise of Hollywood brought about Chinese characters that represented Yellow Peril, the threat they posed to West-

ern civilization. The archetypal yellowface character was Fu Manchu, a combination of the evil scientist trope and the dangerous Oriental. Other films, such as The Cheat (1915) and Broken Blossoms (1919), emphasized that the evil represented by Asian immigrants could not be remedied by social assimilation nor sympathetic and noble behavior. Asian men were drug addicts and rapists. Asian women were sexualized as oriental dancers and prostitutes. These images—which eventually became associated with all Asians—spread nationally in the nineteenth and twentieth centuries. Americans took these portrayals to be real representations of Asian people—especially the Chinese. Even if Asians managed to land an acting part, these were the roles they played. For example, Anna May Wong, a Chinese American actress, only broke through as a celebrity after starring in the Thief of Baghdad (1924) as a Mongol slave girl and Shanghai Express (1932) as a Chinese flapper. But more often, the best roles for Asians and Asian Americans were background roles around a yellowface white actor. At worst, they couldn’t play any characters at all, as white actors put on yellowface and took their place. This problem of Asian American representation and caricaturization continues in Hollywood today as a phenomenon known as whitewashing. This is a practice of casting white actors in non-white character roles, and contemporary instances abound. In Aloha (2015), Emma Stone—an actress of Swedish, German, and Anglican ancestry—played a character of one quarter Chinese and one quarter Hawaiian descent. Sandra Oh made this casting choice the butt of one of her jokes at the 2019 Golden Globes, saying Crazy Rich Asians was the first Asian American-led film since Aloha. Scarlett Johansson played the lead role in Ghost in the Shell, a 2017 film based on an eponymous Japanese manga. Further reducing Asian representation in film, according to a 2014 study by the University of Southern California, Asian characters comprise just 5.3% of roles in 2014’s top 100 grossing films. This is the reason that Crazy Rich Asians’ majority Asian cast is such a radical move for diversity, the movie’s proponents argue. Gemma Chan, who plays Astrid, spoke to the New York Times for an article titled “What Being in ‘Crazy Rich Asians’ Means to the Movie’s Stars.” Chan said being a part of Crazy Rich Asians, “made me realize how often I’ve been the only person of color, and certainly the only Asian actor, on a film or TV set.”

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92% TOMATOMETER Total Count: 326

77% AUDIENCE SCORE User Ratings: 11,551

--Rotten Tomatoes Crazy Rich Asians also serves as progress for Asian American media representation for the roles that the Asian actors play. In the movie’s opening scene, the Young family uses its own connections and wealth to buy the Calthorpe Hotel after the receptionist initially rejects them and tells them to try finding a hotel in Chinatown. Wu plays an economics professor at New York University. Chan plays a successful benefactress. These roles contrast with those to which Asians, or even white actors playing Asian characters, were confined to in early Hollywood. However, responses from mainland viewers haven’t been so warm. Before Crazy Rich Asians was released in China on November 30, Chinese web netizens had already thoroughly discussed the movie in the recesses of the Internet. By that time, posts containing a hashtag of the movie (＃摘金奇缘, or gold-digging unexpected romance as translated by Pleco, a popular translation app) had been viewed over 8 million times on Weibo. In August, a reviewer under the alias “Durian Cake Brother” compared the film to General Tso’s Chicken: inauthentic. Durian Cake Brother lamented that the movie was only nominally about Asians. Crazy Rich Asians, the user said, merely caters to American audiences by reflecting the “American spirit.” He acknowledges that people as rich as Nick Young live in Singapore, but points out that the movie does not represent most Singaporean Chinese, much less all Singaporeans. Rather, it reflects just another way Americans misunderstand people in Asia. Durian Cake Brother is not alone. On Douban, China’s IMDB, the film enjoys a meager 6.2/10.

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Though the revenue statistics are uncertain, negative reviews and comments on Douban and Weibo are crystal clear. Some Chinese netizens commented on how the film reflected Asian American culture more accurately than that of traditional China. Others attacked it for a lack of originality. For instance, another Douban reviewer named Xia’an hadn’t even watched the movie at the time of writing her review but saw material about it on WeChat. In her one-star critique, she claims the movie was just a “rags-to-riches Cinderella story.” She asserts that the movie aims to “flaunt wealth” and “worship money.” This aligns with the viewpoint of Philip J. Cunningham, who wrote a scathing review for the film in China Daily, the Chinese state-run English-language newspaper. He commented that Crazy Rich Asians fails to display real “Chineseness.” Instead, it just takes advantage of Singapore’s exotic scenery and adds Oriental touches to a white American film. The movie, Cunningham writes, is produced with such glamor and excess that it is more reverential than critical of Asia’s high society. This discrepancy between Chinese and American audiences poses a challenge for Hollywood producers, as Chinese audiences are becoming a greater source of revenue. In the first four months of 2018, the Chinese film market overtook North America’s for the first time, according to a report from the South China Morning Post. Charles Rivkin, the chairman of the Motion Picture Association of America, noted that China is “building about 25 [movie theater] screens a day,” while the American and Canadian movie markets are reaching record lows. Because of potential profits, as well as competition to be one of the 34 im-

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ported films a year, Hollywood producers have more incentive than ever to appeal to Chinese audiences and officials. However, though the movie includes actors of Chinese descent, a Chinese soundtrack, and scenes in which the characters make dumplings, the producers were unsure whether the film would even premiere on the mainland. China limits the number of imported films to 34 each year. In its article “‘Crazy Rich Asians’ Has Soared, but It May Not Fly in China,” the New York Times quoted Stanley Rosen, a professor in Chinese culture and society at the University of Southern California. Rosen stated that only foreign films that positively portray China are approved for mainland showings. Instead, Crazy Rich Asians’ depictions of exorbitant spending and wealth inequality may run contrary to Xi Jinping’s championing of anti-corruption measures and socialist values. Entrance into mainland theaters isn’t enough to guarantee commercial success. The film was eventually released in China on November 30, 2018, where it earned a mere $1.2 million and reached the eighth spot in the Chinese box office. Chinese and American—even Chinese American—audiences have different tastes that producers must reconcile. In the past, movie-watchers in mainland China have scorned Hollywood films for trying too hard to pander to them and their perceived tastes. This includes trying too hard to include elements of Chinese culture irrelevant to the movie as a whole, or filling insignificant roles with Chinese actors just for the sake of having Chinese people on screen. Crazy Rich Asians’ breakthrough for diversity in Hollywood might not have been so significant in the mainland, where many of the movies already feature Chinese actors. For instance, Douban reviewer Xia’an questioned whether a cast of Chinese-diasporic actors has any intrinsic value. But a deeper reason behind the film’s poor reception in China may be that Crazy Rich Asians failed to grasp Chinese sentiments on a societal issue that American audiences are less sensitive to: the lives of China’s detested fuerdai. Fuerdai (富 二代) means “rich second generation” and refers to the children of the millionaires and billionaires that rode the wave of China’s rapid economic development since 1978. In China, fuerdai is used as a derogatory term, as many people disapprove of how fuerdai seemingly take their wealth for granted. The formation of an ultra-rich, second generation of Chinese kids that has incited an entire country’s scorn is a product of China’s history. After Deng Xiaoping initiated China’s Open Door Policy in 1978, China’s economy developed at an unprecedented speed. China’s economy and society be-

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How can American producers predict success if a movie that incited pride amongst the Asian diaspora flopped in the mainland because of a supposed lack of authenticity? came much more capitalist and less about unified socialist glory. This set China on the path to become the second largest economy, but also created immense income and wealth inequality. The business developers that succeeded throughout China’s economic progress at the end of the twentieth century now have children of their own. This generation faces the question of how to spend its time and endless coffers of money. Nonprofits like the Relay China Elite Association even teach fuerdai how to carry on their family businesses so that the fuerdai gain a sense of purpose and don’t waste their days away. However, fuerdai and their antics have come to represent China’s recent history of economic inequality and corruption. Criticism directed at fuerdai explodes online, where the whole country is connected by various social media sites like WeChat and Weibo. In September 2015, Bloomberg Businessweek published a feature on the scandals caused by the second-generation rich, titled “Children of the Yuan Percent: Everyone Hates China’s Rich Kids.” Fuerdai have set fire to piles of 100 yuan ($16) bills, posted pictures of them online next to their Lamborghinis, and crashed their Ferraris on the street. The son of Wang Jianlian, China’s richest man at the time, caused a national outrage after posting a picture of his dog wearing two gold Apple Watches. Many Chinese view these materialistic and decadent millennials as a national embarrassment. Businessweek quoted China’s United Front Work Department, saying

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“They [fuerdai] know only how to show off their wealth but don’t know how to create wealth.” This generation even forms the basis of the rich Asian international college student trope, as some of them attend American or Australian universities and become the subject of university memes. Though Douban reviews do not explicitly connect fuerdai with the characters in Crazy Rich Asians, the language used to criticize both is the same. The comparison is not unfounded. Characters reminiscent of fuerdai, as well as elements of their flashy lifestyle, abound in Crazy Rich Asians. The Youngs have luxurious bachelor and bachelorette parties. They live in mansions grander than those in Greenwich and Newport. They ride sports cars through the highways of Singapore, car hoods down and all. One Douban reviewer claimed that even the nerdy stereotype of an Asian doing math was a better image than what Crazy Rich Asians glamorized. But unlike Chinese audiences, Americans do not quite have a fuerdai equivalent. People mock Kim Kardashian for having a lavish wedding only to divorce Kris Humphries after 72 days—or for almost anything the family does on Keeping Up With the Kardashians. But the American public does not go as far as to say they’re a national disgrace and a product of the country’s uneven economic development. And unlike in China, the United States government does not scorn nor keep close watch on the Kardashians or similar celebrities. Howev-

er, Businessweek noted that the Chinese government itself views fuerdai as a national concern. Xi Jinping called on fuerdai to “think about the source of their wealth and how to behave after becoming affluent.” Though the Communist Party’s anti-corruption campaign has decreased excessive displays of wealth, fuerdai still strike a negative chord amongst the Chinese people. However, regardless of Chinese inequality, the question of whether Hollywood producers can reconcile both Chinese and American tastes still stands. How can American producers predict success if a movie that incited pride amongst the Asian diaspora flopped in the mainland because of a supposed lack of authenticity? Does the Chinese market have space for Hollywood movies if American films with all Asian and Asian-American casts can’t even succeed? According to the New York Times’ article “‘Crazy Rich Asians’ Has Soared, But It May Not Fly in China,” filmmakers should not lose hope. In Crazy Rich Asians, both Chinese and Chinese diasporic audiences enjoyed certain cross-cultural elements. VAVA, a Chinese rapper, reached new levels of exposure and popularity after her song “我的新衣” (“My New Swag”) was included in the movie’s soundtrack. She is one of the many Chinese hip-hop artists who are becoming popular inside and outside of the mainland. Will the inclusion of similar pop culture elements be enough to please both audiences in the future? Only when more China-oriented Hollywood movies enter China’s film market will we find out.

Business & Technology

EYE SPY CHINESE SURVEILLANCE & THE DAWN OF DIGITAL AUTHORITARIANISM

Text //Sharon Li Illustration // Cindy Lee

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s China races towards establishing itself as the world’s leading technology superpower, new developments in advanced technology have seen large-scale integration on the state level, particularly within the expanding presence of the country’s surveillance state. In previous decades, surveillance has largely been limited to vast sets of video footage and live-feeds, all of which require human labor to monitor and comb through; however, algorithmic surveillance is steadily becoming the norm with the help of machine learning and other forms of artificial intelligence. In the past half-decade, global surveillance equipment sales increased by 55%. According to IHS Markit, the Chinese market accounted for 44% of all global revenue in video surveillance equipment, much of which can be attributed to the government’s recent expansion of local and national-level security programs. Just two of the many programs in the country include Xue Liang, or Sharp Eyes, and the government’s “safe city” or “smart city” project. The former is a surveillance and facial-recognition security program currently being piloted in fifty rural towns, while the latter targets urban areas and currently has 500 pilots across the country. Unsurprisingly, the companies that develop the equipment and technology for such programs have enjoyed major financial windfalls. Hikvision, a Hangzhou-based company founded in 2001, currently stands as the world’s largest manufacturer of surveillance equipment. Their controlling shareholder is the Chinese government, which operates through the China Electronics Technology Group, a 100% state-owned defense and military electronics manufacturer. Contracts from the local and national government have, naturally, significantly bolstered Hikvision’s finances. In 2017, the company took in a revenue

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of USD 6.07 billion—in the same year, they won five security contracts in Xinjiang, totaling USD 270 million. One such project is in Moyu, a county which reportedly saw the disappearance of half of their Uyghur population to re-education camps. According to the original tender obtained by Agence France-Presse, the contract calls for a network of 35,000 cameras to monitor everything from streets to schools and office buildings to mosques—specifically, 967 facial recognition cameras for each of the 967 mosques in the county. These new cameras, along with 840 dome/bullet cameras equipped with full-color nighttime vision, will be integrated into the already existing mosque surveillance system in the region, which currently consists of five basic surveillance cameras for each mosque. Aside from mosque surveillance in Moyu, Hikvision will also develop and provide six video monitoring systems in the form of panoramic cameras for the re-education centers, which allow for complete surveillance with no blind spots. In return, Hikvision is guaranteed an 8% annual return which will likely be generated through the increased fines that will result from the surveillance system. Other contracts with Hikvision include a USD $53 million facial recognition deal in Pishan—which, according to the original tender for the competitive consultation announcement, will include mosque video lecture systems and networking systems—and a USD $73 million contract in Xinjiang’s capital city of Urumqi, which will require 30,000 additional security cameras. And these are just three of the dozens of surveillance projects in Xinjiang—three of the USD $1.2 billion-valued surveillance projects that Hikvision and its competitor Dahua have won in Xinjiang in the past few years. Already, Xinjiang’s security costs far surpass any other part of China’s, and in the past year alone, the region’s surveillance and security spending has almost doubled, with the government cit-

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ing the threat of extremism and terrorism as the cause. The government’s method of spurring development within the surveillance market is also notable. Rather than directly pour funds into the market and risk immediate market distortion, the state instead provides local governments with funds so municipalities can independently host competitions that guarantee certain companies massive contracts and long funding-cycles. Such million and billion dollar contracts come in the form of public-private partnerships (PPP), in which winning companies finance the majority of the spending for “guaranteed investment returns.” These contracts are incentivizing surveillance companies such as Hikvision to update their equipment and develop the more advanced technology required for biometric surveilling and algorithmic facial recognition through machine or deep learning. Deep learning, in particular, has gained attention as the new frontier in AI and is able to go beyond machine learning in its capability to “self-learn”—in this case, to classify certain features or patterns— based on an artificial neural network. Already, Hikvision has launched multiple products with deep learning algorithms, which consist of capabilities from auto-tracking to license-plate identification, to immediate classification of blacklisted individuals. And the company has made other strides towards algorithmic surveilling. In 2014, they showcased thermal monitors that could record under ultralow light conditions, license-based recognition, and explosion-proof cameras that could “alert authorities to large gatherings.” This last type of camera, the ‘dome-shaped bullet’ camera, happens to be the type installed in Moyu County of Xinjiang. But what does this mean for surveillance in China? Undoubtedly, with the help of Hikvision’s development, advanced surveillance equipment will only become more ubiquitous in already heav-

ily policed areas such as Xinjiang. Even outside of autonomous regions, this type of advanced surveillance is already being embraced in the form of expanding “safe city” and “smart city” programs, particularly in large urban areas. Predictive policing, “voice printing,” social credit scores—all of these methods have been used and will continue to develop with the help of vast swaths of available data, loose data laws, increasing power of the state, and an influx of funding. And as China continues to push for the incorporation of more advanced technology in the surveillance state, companies such as Hikvision will continue to lead the way. However, the political and macroeconomic implications of such surveillance extend far beyond just China. Democratic countries such as the United States have begun to very publicly voice concerns that China’s technology is intentionally bolstering an authoritarian world order. Such fear is not completely without reason. Chinese surveillance technology has proven to have a far and penetrating reach, and is undoubtedly increasing the ease at which governments can monitor and potentially control their people. Furthermore, Chinese companies known for their role in developing advanced surveillance techniques for the state such as Sensetime, CloudWalk, Hikvision, and Yitu not only lead in countries that are launching their own smart city programs or advanced surveillance systems such as Malaysia, Singapore, and Zimbabwe, but also in advanced democracies like the United States. By providing more effective means for governments to seamlessly integrate these programs, China— though not exactly imposing an authoritarian world order—is advancing it, and simultaneously making it more enticing. And it is bolstering not just the traditional form of authoritarianism, but an unprecedented digital authoritarianism. However, it is crucial to recognize that China is not single-handedly creating this new system. As mentioned, other

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countries are not only financially supporting such endeavors but creating parallel systems as well. The United States has dramatically escalated mass surveillance programs in the past decade, many of which were headed by the National Security Agency and Department of Homeland Security. And such surveillance databases and policing techniques—which typically operate to curb terrorism, espionage, money-laundering, and other large-scale crimes—have been accused of disproportionally targeting people of color. Furthermore, through surveillance programs such as PRISM and USA Patriot Act, the United States government works and partners with commercial companies such as Facebook, Apple, Google, AT&T, and T-Mobile to surveil users. This may sound familiar, as China is taking similar—if not identical—measures to surveil their own people. Unlike in China, however, the United States governments lags far behind in terms of integrating artificial intelligence and more advanced technology into their surveillance methods, which can largely be attributed to the bureaucracy and red tape that restricts the tech sector from state-level adoption. Furthermore, as shown earlier last year with the protests that resulted from Google and its involvement in using “AI to process drone video feeds” for the Pentagon’s Project Maven, civilians have more of a voice in objecting to what they see as technological misuse—or at least, when such information

is public. Thus, while the United States is creating domestic surveillance programs that echo the very ones they criticize China for, there is too large a gap between the private sector and the state to create the advanced surveillance system that China has put in place. For now, it is difficult to say exactly how much machine learning technology and other technologies with surveillance applications are altering the democratic world order, given such technology has only recently begun to be developed. Furthermore, we cannot claim that, without China, such technology would not exist or would not eventually develop. On the other hand, without the rapid and unfettered development of surveillance technology that the unique political and economic conditions of China allows, it is highly unlikely that the international community would presently be facing authoritarianism in this form and at this gravity. Ultimately, one thing is clear. The potential for digital authoritarianism is more real than ever. And while China may be leading it, countries like the United States are also contributing to its establishment. For this potential to actually become a threat, it would take acceptance, adoption, and integration on an international-scale. At least in some parts of the world, this seems to be a likely reality.

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Blockchain:

Rising Tide or Binding Fetters for the Next China? Text // Sharon Li Image // Investopedia & MIT

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s the mayhem around bitcoin has begun to die down in the United States, the record-keeping technology behind it—blockchain—still surges forward. In China, this is no exception. The most basic definition of blockchain calls it a “distributed, decentralized, public ledger”; in other words, it is a public database of verified digital transactions that stores its records not only in its own “block,” but in all subsequent blocks of digital records, which makes the stored data incredibly difficult to be manipulated given the linking nature of the chain. So why is China concerned? The state’s recent launch of “Made in China 2025,” an industrial plan to make the country a global leader in developing and manufacturing advanced technology, points towards a larger aim of turning away from China’s current dependence on foreign technology. And while blockchain isn’t necessarily significant in tech manufacturing, any movement by the state to adopt such technology—and codify it into law— would still have sweeping political and social implications in the country’s greater push for power in the world of tech.

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Late last year, China’s Supreme People’s Court declared that blockchain would be an approved method for “storing and authenticating digital evidence.” This came in response to a recent case taken by Hangzhou’s internet court, which ruled that evidence on blockchain was a legally acceptable form of evidence—at least in a copyright infringement case. This steady acceptance and adoption of blockchain in legal matters of the state also extends beyond the courts. China’s central bank, the People’s Bank of China, is currently beginning to utilize a “blockchain-based trade finance platform” for inter-bank payments. The CCP recently released a primer that discussed potential opportunities and challenges in the blockchain industry. Much like their national counterparts, local governments have also been employing blockchain for legal matters. Convicts on parole in Zhongshan reportedly have their movements monitored through a blockchain-based system in order to “reduce the manpower burden that is traditionally required to physically follow parolees”; and according to the Zhongshan Daily Release, the new system uses a new electronic bracelet with the “highest level encryption algorithm” that stores data in real time. The city of Shenzhen is taking similar measures to fight tax evasion, as it was an

SHIFT+CMD+CLICK Business & Technology to change individually

Ultimately, China’s welcome of blockchain isn’t exactly with open arms, as it stands in the foreground of a blatant distrust of cryptocurrency, but blockchain’s significance to the Chinese state is undoubtedly growing. nounced in May of last year that the Shenzhen National Taxation Bureau had partnered with Chinese tech company Tencent to work on a new digital invoice solution using blockchain—which would help combat forged and doctored receipts. But the warm reception that blockchain has received from the Chinese state stands in stark contrast with their stance towards crypto-currency. Considering China’s historical regulation of the value of their exchange rate, allowing a volatile and non-fixed form of currency to flood the market would go against decades of economic policy. Late in 2017, the CPC banned all forms of cryptocurrency-based fundraising (i.e. initial coin offerings), which businesses typically use to raise capital, and ordered “Chinese cryptocurrency exchanges to cease trading.” Then, in another effort to prevent mainland customers from accessing crypto assets, the state blocked access to “more than 120 offshore cryptocurrency exchanges” at the end of 2018 and even allegedly began taking down news accounts that would typically report on cryptocurrency. Unmistakably, there are some parts of blockchain the Chinese state finds more attractive than others. And as Forbes’ blockchain expert Steven Ehrlich pointed out, this “retrofitting” of a breakthrough technology for its own market is a strategy that China has used in the past. Most notably, is the strikingly similar approach the state previously took with tech platforms Google and Facebook. China’s hostility towards cryptocurrency makes their reception of blockchain all the more significant, because it is an adoption and adaption of an already existing form of technology in a manner markedly different with the global norm. One of the most commonly toted features that blockchain brings—decentralization—has no place in China’s plans for the technology industry. While the strategy that the city of Shenzhen has taken up with blockchain is very similar those of many banks and financial institutions in the United States, the adoption of

blockchain to monitor parolees is one that is largely unprecedented. And though there have not been any reports of blockchain in regions like Xinjiang—where ethnic minorities are currently being interned, surveilled, and oppressed—striking parallels exist between parolee monitoring with blockchain and the surveilling of Uighurs with facial recognition and artificial intelligence. Also to note are the potential use cases of blockchain in furthering China’s social credit system by creating a record system that is both immutable and immediately traceable. According to their white paper, blockchain startup THEKEY has already used the personal identification data of 210 million people in 66 cities supplied by the Chinese government. As mentioned, parts of China’s strategy closely mirror that of the United States’. Many financial institutions in the United States, and even multiple departments of the government, are already employing the technology in very similar means, but with the greatest focus on being able to “securely store and process data.” As the hacking of Equifax in 2017 has shown, data breaches have massive financial and social consequences for both companies and customers alike, and methods to secure such data would be crucial for the success of large-scale business. Thus, it is of no surprise that both public and private bodies across the world are beginning to adopt blockchain-based strategies. The only difference with China is the extent to which such adoption is integrated into the state’s legal framework. Ultimately, China’s welcome of blockchain isn’t exactly with open arms, as it stands in the foreground of a blatant distrust of cryptocurrency, but blockchain’s significance to the Chinese state is undoubtedly growing. Their current use of blockchain touches on everything from legal evidence and punitive supervision to data security for the state’s financial bodies, and as its technological development continues, its potential for the Chinese government will only increase. But with technology as new as blockchain and the unexplored nature of legal integration, we are left to wonder exactly what precedent China plans to set.

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Entangled in Huawei? Text // Joe Wu Image // The New York Times and Visual China Group

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n December 1st, 2018, Huawei CFO Meng Wanzhou was detained in Vancouver on suspicions that Huawei had violated economic sanctions on Iran. The unsealed indictment revealed additional allegations charging Huawei with obstructing justice and stealing technology. If the allegations are proven and the US implements export controls against Huawei, and even if Huawei avoids a collapse similar to which Chinese state-owned chipmaker Fujian Jinhua suffered, the effects will shape the global telecommunications order for decades to come. Huawei is currently one of the largest suppliers of global telecommunications equipment, with over $100 billion estimated in sales last year. In addition, Huawei controls an estimated 10.4% of the global smartphone market, shipping an estimated 200 million devices in 2018 and becoming the world’s second largest phone maker ahead of Apple. Huawei is a key cog in China’s “Made in China 2025” initiative, which aims to establish self-reliant cutting-edge high-value industries that are

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globally competitive. Huawei’s central role in China’s grand economic plans has incited growing global concerns that the company is beholden to the Chinese state. Worries revolve around possible exploitation of Huawei’s products to facilitate cyber espionage activities by Beijing. Australia and New Zealand have followed the US in restricting Huawei’s participation in developing their next-generation 5G mobile infrastructure. Australia, New Zealand, and the US are three of the five members of the intelligence-sharing alliance Five Eyes, and their opposition to Huawei has placed increasing pressure on remaining members UK and Canada to adopt similar stances, as they may be excluded from future Five Eye operations otherwise. Various American allies have enacted similar bans, restrictions and warnings, including Germany and Japan. Even countries with close economic and political links to China such as the Czech Republic have also begun to view links with Huawei with greater suspicion. Most recently, the Czech Republic has excluded the company

from bidding for a communications contract for President Miloš Zeman and his staff. This contract has been fulfilled by Huawei for the past three years and has become a symbol of national trust and cooperation, one which is now shattered. This anxiety stems in part with China’s legislative framework, which could pose conflict of interest challenges for Huawei on matters of national security. For example, Article 7 of the National Intelligence Law requires “any organization or citizen” to “support, assist, and cooperate with state intelligence work according to law.” Article 14 of the same law empowers “state intelligence work organs” to “demand that concerned organs, organizations, or citizens provide needed support, assistance, and cooperation.” Although it is uncertain if Huawei will actively cooperate with Chinese intelligence due to the need to protect its “reputation and clientele,” it is difficult to know how the company may react if presented with threats from the Chinese state such as to preserve its existence or the freedom of its leadership.

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Based on the available evidence, many of Huawei’s competitors have quantifiable links to their foreign governments. For instance, the Finnish government recently purchased a sizeable 3.3% stake in Nokia with the stated intention of “shoring up national ownership” and exerting “more influence” on the company. The Canadian government has invested US$30 million in Nokia to develop and research 5G technology, further increasing sovereign involvement in Nokia’s 5G technology. Huawei, in 2014 allowed the Financial Times to examine its books to report on its ownership structure;

It was almost 99% employee owned, with only employees able to purchase shares, excluding share ownership by external investors and that of the government. However, Huawei has also been given access to a $30 billion line of credit from the China Development Bank to “help it win telecoms contracts abroad.” Huawei’s security record based on public knowledge is relatively mundane compared to other companies. Two of the worst privacy breaches in the past decade include the Cambridge Analytica scandal by Facebook (affecting 87 million users) and Google+ glitch by Google (affecting 52.5 million users) are both products of public US companies. US government contracts to break encryption codes for iPhones are provided by Israel-based Cellbrite, while other flaws are exploited to target human rights defenders with solutions provided by another Israel-based company, the NSO Group and their solutions most notably used by the United Arab Emirates. In short, flaws will continue to exist whether by fault or design, and have potential to be exploited, but no records have shown that flaws in Huawei products have been exploited to date.

With this in mind, what are the possible consequences of excluding Huawei from the international telecommunications space? The global telecoms equipment sector is deeply interdependent and intertwined; 33 out of 92 of Huawei’s top suppliers are American companies, while chip providers Intel and NXP recently celebrated a decade’s worth of cooperation with Huawei. Export controls that constrain Huawei by controlling access to US technology could have devastating impacts on the company’s operations, even more so than restrictions that close off the US market. These consequences are not limited to affecting the global supply chain and technological development. Bans could even result in the creation of parallel and separate technological spheres with incompatible standards. Chinese retaliation would have knock-on effects for their respective equipment suppliers, including those in the US and Europe. Potential victims may include the suppliers which currently provide Huawei with chips or high profile American companies such as Apple, which are already in precarious situations given falling revenues from the Chinese market. Responses by the telecom industry have also revealed uncertainty and anxiety, with European telecoms companies calling on European governments to establish a “testing regime” to prevent the “disruption” of excluding vendors from the market. They warn of the devastating consequences of exclusion, including disrupting the supply of telecoms equipment, increasing costs to the industry and customers, delaying the rollout of 5G services by years, and potentially hobbling existing networks. These fears reflect the clout of Huawei as an essential player in the global communications infrastructure and the international dependence on their products. In essence, the costs of constraining Huawei could be quite high especially in the long run, and it is unclear what security threats Huawei poses. Should the US government or any government have additional evidence that reveal legitimate security concerns with Huawei products, this should be publicized so that others can make their own informed decisions. Only by knowing the tangible risks can calculated decisions and adequate responses be formulated.

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THE CHINESE INVESTMENT PARADOX Text // Alex Herkert Illustration // Nina Li

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ver the past decades, the inception and direction of Chinese outbound investment has become a topic of great significance with global ramifications. Total Chinese investment in the US has grown from less than $2.5 billion between 1978 and 1999 to more than $178 billion from 2005 to the present. The extent to which the Chinese Communist Party (CCP) controls the outbound investment flows of Chinese domestic companies, both state-owned and private, has a large bearing on the potential political and economic implications of Chinese outbound foreign direct investment (OFDI). Observing and analyzing Chinese investment into the US technology and entertainment sectors, two areas in which Chinese central investment strategy has differed greatly over the past five years, yields some interesting conclusions about the extent to which the Chinese state controls OFDI. Looking at the entertainment sector, beginning in 2012 large Chinese companies made many big-ticket acquisitions of US entertainment entities, from Wanda’s acquisition of AMC for $2.6 billion in 2012 to Zhonghong Zhuoye Group’s acquisition of Sea World in 2017 for $430 million. While China’s expanding middle class provides a market explanation for heightened Chinese entertainment demand, acquisitions like these have received extensive press coverage. Much of these transactions highlight the fact that China is now capable of purchasing America’s most highly valued cultural and soft-power exports. However, as of 2016 there has been a large shift in OFDI away from entertainment, as the entire sector has been classified as “restricted” in the Foreign Investment Catalogue published by the National Development and Reform Commission (NDRC)

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and the Ministry of Commerce (MOFCOM). The restriction is due to government worries about overextension of Chinese companies into expensive entertainment assets deemed non-strategic. Conglomerates active in entertainment acquisitions, including Wanda, Anbang, and Fosun, now face serious financial difficulties and repercussions from the central government. The technology sector presents an interesting foil to the entertainment sector by comparing the two points to differences in effectiveness between the restriction and promotion of OFDI by the Chinese government. Chinese firms, both public and private, have made a large number of high-profile and high-value acquisition deals from 2012 to 2016 in technology as in the entertainment sector. However, in recent years investment activity in technology has been strongly supported rather than discouraged. Strategic technology assets have been classified as “encouraged”, not “restricted”, by the NDRC and MOFCOM, and as such receive substantial rhetorical and financial support from the central government. The Chinese government has signaled more support for growing OFDI in technology through prioritization of the Made in China 2025 framework and the development of special Integrated-Circuit (IC) technology funds. Despite the vastly different central government approaches to Chinese investment in entertainment and technology, both sectors have seen an enormous decrease in investment value since the record-breaking examples of 2016. In the entertainment sector, this change can be largely explained through the

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promulgation of a number of state policies and statements meant to curtail investment. These include the Ministry of Commerce published Foreign Investment Catalogue, which details which sectors are encouraged, restricted, or prohibited, and if not listed, tacitly permitted. This is in addition to the Measures for Overseas Investment from the National Development and Reform Commission (NDRC) in 2018. Taken together, these regulations have changed the core nature of Chinese OFDI. In 2017 alone,

more than $75 billion dollars worth of Chinese OFDI deals were cancelled due to the expansion of the “negative list” and restricted investments. In the wake of tightening control, the state re-emerged as the main contributor to OFDI flows because, as quoted by an unnamed SOE boss, “We have the channels to communicate with the regulators”. Where these policies have been effective in restricting investment into entertainment assets, similar policies promulgated through the Ministry of Commerce, Ministry of Finance, NDRC, and the State Council have been unable to dramatically increase or sustain Chinese private and public investment into critical technology industries in the United States. More than one third of projects supported financially or rhetorically by the Chinese state in the technology sector failed in the time

period from 2012 to the present, which supports the view that the government is not successful in dictating outcomes for investment in the technology sector. Higher government support and involvement in an acquisition appears to actually increase the rate of failure. China’s actions to reassert state power and the public acknowledgement of investment control create opposition for its own state supported acquisitions. Consequently, the government is working against itself, simultaneously encouraging strategic investment and ensuring that the US will intensely scrutinize all proposals. Unfortunately for China, there is little it can do to solve the current conundrum—by publicly pushing private and public companies to make acquisitions in the name of improving the country’s technological power, the government is essentially exacerbating the Council

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While the Chinese government has had divergent success in restricting outbound investment into the entertainment sector and encouraging investment into technology, the sectors are not entirely dissimilar. on Foreign Investment in the United States (CFIUS) suspicions. While the Chinese government has had divergent success in restricting outbound investment into the entertainment sector and encouraging investment into technology, the sectors are not entirely dissimilar. They share the context of a Chinese economy in which slowing growth and an anti-corruption campaign have created a strong impetus to move as much capital as possible into overseas assets. This, coupled with loosening outbound investment regulation through 2016, accounts for the sharp rise in investment for both sectors through the end of that year. Rising investment in technology through 2016 was a success for the Chinese government, as technological assets had already been designated as “encouraged� through the Foreign Investment Catalogue, and both the 13th Five Year Plan and

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the Made in China 2025 Initiative, which strongly support technological progress, were published in advance of 2016. In the entertainment sector, rising investment cannot be categorized as either a success or a failure for Chinese regulators, as they had not explicitly attempted to encourage or discourage investment in the sector until later on. The state played little role in coordinating investments during this time period, during which companies themselves took the lead in deciding where and how much to invest. What is clear from what followed is that the Chinese government was content with progress in technological investment, but not with the accumulation of entertainment assets. In the following two years, despite differential policies, both sectors experienced a steep decline in outbound investment. The combination of Chinese success in cutting off investment into entertainment and concurrent inability

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to continue investment into strategic technology assets led to a 92% drop in Chinese FDI towards the United States year on year by 2018. For the CCP, where the government has maintained critical control over not just public but also private companies, curtailing investment proved significantly easier than promoting it, as no foreign entities could complicate or mitigate its ambitions. However, both the sector specificity and speed at which the complete reversal of Chinese investment into US entertainment companies was achieved elucidate the impressive power and coordination amongst the various Chinese regulatory bodies. The CCP likewise put significant impetus behind accelerated technological investments but misread how this would be perceived globally, ultimately bringing an end to whatever success they previously had with acquisitions in that sector. Regardless of whether it is playing a role in restricting or promoting outbound investment, the Party is reemerging as the preeminent force of change in the Chinese economy. Under Xi Jinping, Party cells have been instituted in more private businesses, even joint ventures funded with overseas partners. Moreover, the CCP has written itself into the articles of association of many of the country’s largest companies, making explicit long-held assumptions about the strength of Party influence in that sector. The net result of these actions impacts both the entertainment and technology sectors— the advance of the state, and the retreat of the private sector. The recentralization of economic decision-making power around Beijing puts the more liberal years between 2012 and 2016 in perspective—they stand out as the exception, rather than the beginning of a trend. There are many important implications of this conclusion, as Chinese investment has become integral to the economies of countries around the globe. The fact that the government was able to quickly and effectively restrict investment into the US entertainment sector should cause concern that China may wield the restriction of investment as a political tactic in negotiations with trading partners. While entertainment firms throughout the US felt the sting of curtailed Chinese investment, the consequences could be markedly more extreme if a country’s energy, trade, or military development had become dependent upon Chinese investment—this has already happened in countries like Sri Lanka. The case of Chinese investment in technology yields a different conclusion. As China continues to grow and transition from an industrial to modern and service-focused economy, the acquisition of foreign technology and experience are critical. The Chinese experience with investment in semiconductor, computer chip, integrated circuit, and other technology companies demonstrates that this task is not easily accomplished. No matter that Chinese firms, through preferential financing and state backing, are able to offer above market price for the firms in which they are interested, they are still often unable to successfully complete acquisitions. This also points to a weakness in China’s state dominated OFDI regime, as explicit government control of investment pushes countries such as the United States to block investments in critical technologies. Many European countries are now planning on installing government review mechanisms similar to CFIUS, in light of the Chinese investment spree. The efficacy and success of Chinese regulation of investment is a particularly current phenomenon. Looking at the United States’ entertainment and technology sectors, some of the premier destinations for Chinese investment, presents a unique perspective into the differential outcomes between the restriction and promotion of outbound investment. Questions regarding Chinese OFDI regulation will continue to be important as China promotes investment through the Belt and Road Initiative and Made in China 2025, and both China and recipient countries must continually adjust policies to accommodate the changing priorities and consequences of Chinese OFDI.

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Features

CHINA’S TRILLION-DOLLAR

STRAW MAN

Author // Jeffrey Fu | Image // Anzhi Weng, Flickr, Discover Africa, DefPost, Nikkei Asian Review, Foreign Policy, Young Pioneer Tours, Politico

I. INTRODUCTION

O, What a Tangled Web We Weave

B

y the tranquil shores of Keenjhar Lake in Southern Pakistan lies a vast stretch of saline land, dotted by rumpled bushes and 66 sets of wind turbine generators. Together, these turbines feed 99 MW of power into Pakistan’s nati onal grid. The project is expected to help reduce the regular power outages that are a vexing source of inconvenience in Pakistan. Financed with $250 million from China Development Bank and constructed by China Gezhouba Group, the UEP Wind Farm is operated by United Energy Pakistan, a subsidiary of the Hong Kong-based United Energy Group. Meanwhile, in the garden paradise of Mauritius a secretive network of 4,000 HD cameras, 300 automatic number-plate recognition checkpoints, and 45 base stations is nearing completion. This “Safe City” solution is expected to improve emergency handling efficiency by 60%, while preventing and deterring a wide variety of crimes. Locals fret about the threat this poses to their privacy and wonder whether the project can justify its high operating costs. Financed with $13 million from EXIM Bank of China and constructed by Huawei, the Mauritius “Safe City” project is being implemented by Mauritius Telecom in cooperation with the Mauritian government. What does surveillance in Mauritius have to do with power production in Pakistan? How do these two Belt and Road Initiative projects fit into the insidious web of control and influence that the CCP spins from its shadowy perch in Beijing? What level of centralized power over banks and multinational corporations must the CCP exert to build these projects so far from home?

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These are questions that have confounded strategists around the world since Chinese President Xi Jinping proposed the “Silk Road Economic Belt concept” in 2013, which has since been renamed the “Belt and Road Initiative.” Washington’s assessment of the Belt and Road Initiative is concisely captured by former Secretary of State Rex Tillerson’s remarks criticizing China’s approach as one that “encourages dependency using opaque contracts, predatory loan practices, and corrupt deals that mire nations in debt and undercut their sovereignty, denying them their long-term, self-sustaining growth.” New Delhi’s analysis of the Belt and Road Initiative is even graver, as influential Indian strategist Brahma Chellaney warns of a “hegemonic sphere of trade, communication, transportation, and security links” that furthers China’s “neocolonial designs.” Xi Jinping has responded that “The Belt and Road Initiative … is neither the post-World War Two Marshall Plan, nor is it a Chinese conspiracy. If you had to [call it something], it’s an ‘overt plot’” to promote cooperation and economic integration. The truth, in this case, is not somewhere in the middle. Tiller-

son and Chellaney’s descriptions of the Belt and Road Initiative both imply a level of premeditation, control, and consistency that has not been reflected in the projects designated as part of the initiative. Consequently, much of the existing literature and coverage of the Belt and Road Initiative is fundamentally flawed, treating the Belt and Road Initiative as though it were a Five-Year Plan to colonize the world and encircle the US. It is more accurate to characterize the Belt and Road Initiative as a brand built on these principles: 1. Economic development is a cure-all; 2. Infrastructure is the missing ingredient for development; 3. Noninterference in internal affairs of others is the key to inclusivity. By analyzing the Belt and Road Initiative as a fluid, experimental approach to international development and diplomacy rather than a monolithic, fully-conceived plan for Chinese ascendancy, it becomes possible to look past simplistic neocolonialism narratives and distinguish between opportunities to cooperate and occasions to compete. To illustrate the power of this alternative framework, we can apply it to China’s acquisition of Hambantota Port,

II. HAMBANTOTA PORT

The White Elephant in the Room Opponents of the Belt and Road Initiative have pointed to Hambantota Port in Sri Lanka as the classic example of China’s predatory financing behavior. Vice President Mike Pence summarized the case: “Just ask Sri Lanka, which took on massive debt to let Chinese state companies build a port of questionable commercial value. Two years ago, that country could no longer afford its payments, so Beijing pressured Sri Lanka to deliver the new port directly into Chinese hands. It may soon become a forward military base for China’s growing blue-water navy.” This critique of China’s involvement

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in Hambantota Port, which touches upon multiple points of international concern, can be deconstructed into a series of statements that are misleading at best and false at worst. Most problematic is the accusation that China acquired the port to expand its overseas maritime power projection capabilities. On July 2nd, 2018, Sri Lankan Prime Minister Ranil Wickremesignhe’s office announced that Sri Lanka would shift a naval base to Hambantota, stating that “Sri Lanka has already informed China that Hambantota Port cannot be used for military purposes” and that “the security of the port will be under the control of Sri Lanka’s navy.” Thus, it is odd for Pence to claim that Hambantota Port “may soon become a forward military base for China’s growing blue-water navy” in a speech on October 4th, 2018, three months after Sri Lanka made it clear by both action and declaration that this was off the table. Another problematic assertion is the linkage of the “massive debt to let Chinese state companies build a port of questionable commercial value” with Sri Lanka’s subsequent inability to repay loans. In January 2019, Central Bank of Sri Lanka Governor Coomaraswamy stated that China held only 9% of Sri Lanka’s total external debt, and data released by the central bank indicated that Sri Lanka’s current external debt service payments to the Japan actually outweigh those to China. Implying that China’s infrastructure loans are the primary reason that Sri Lanka is in fiscal distress both overstates China’s role and exaggerates the amount of political leverage China wields through its limited share of Sri Lanka’s debt. More subtly, Pence’s summary of the Hambantota Port case implies that the project was conceived unilaterally by China, stating that Sri Lanka “let” China build a port rather than “commissioned” or “contracted.” In doing so, he ties the Hambantota Port case into a broader narrative in which China approaches corrupt governments with outlandish infrastructure projects, deceives them into believing that they are feasible, then leverages the resulting debt into strategic assets. However, World Bank documentation reveals that developing a port at Hambantota has been part of Sri Lanka’s official development plans as early as 2002. In fact, prior to approaching China, former Prime Minister Mahinda Rajapaksa first reached out to India for funding for the same project. Furthermore, independent non-Chinese firms (French engineering firm SNC Lavalin and Danish consulting firm Ramboll) completed feasibility studies in 2003 and 2006 that indicated Hambantota Port was a viable investment. Ultimately, Chinese state-owned enterprise China Merchants paid $973.7 million for the right to jointly operate Hambantota Port with Sri Lanka Ports Authority for 99 years, and is committed to “investing up to $1.12 billion to devel-

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Port Louis, Mauritius, one of several cities implementing Huawei’s “Safe City” solution.

A Chinese Navy Type 815G intelligence ship observes US naval exercises off the coast of Guam.

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A narrative that so persuasively purports to explain the Chinese strategy behind the entire Belt and Road Initiative, that so stunningly fails to explain its own pet case, would be a terribly flawed foundation for US counterstrategy.

op, manage and operate Sri Lanka’s Hambantota Port.” Pessimists view this as the worst-case outcome of China’s debt-trapping. However, this is arguably the best-case outcome for Sri Lanka short of debt forgiveness. Instead of continuing to bear hefty operating losses from an underutilized port, Sri Lanka reduces its existing debt burden. China Merchants, despite being a state-owned enterprise, is “one of the world’s largest and most competitive transport and aviation companies” and helped transform Sri Lanka’s Port of Colombo from one “on the brink of bankruptcy” to the “fastest-growing in the world” in 2014. By committing over a billion dollars to continued port development, there is a solid chance Hambantota Port will ultimately become successful. In the event that China Merchants transforms Hambantota into a success story, Sri Lanka stands to benefit long before the 99-year lease expires, as under the current deal Sri Lanka Ports Authority already holds a 30% stake that will gradually increase to a 50% stake starting after 10 years. Even if the port itself is unprofitable, it can still attract foreign investment from other sources. Already, the port has attracted massive foreign direct investment from non-Chinese sources, as India’s Accord Group and Oman’s Ministry of Oil and Gas have signed a deal to build a $3.85 billion oil refinery next to Hambantota Port, through which the refinery will export an estimated 9 million metric tons of refined products, growing Sri Lankan exports by $7 billion a year. It is likely to attract additional foreign investment as China Merchants develops a complementary 11 square kilometer special economic zone alongside the port. This is expected to generate 100,000 new jobs through $5 billion in investments.

The hard truth is, if China did hope to extract maximum political leverage via its debt holdings in Sri Lanka, it should have waited longer. Consider, for instance, the degree of influence creditors were able to exert on Greek domestic policy from 2010 to 2018 once Greece was in sufficiently dire fiscal straits, described by one observer as “an epic period of colonization; of asset stripping and privatization; of unfunded health and education; of bankruptcies, foreclosures, homelessness, and impoverishment; of unemployment, emigration, and suicide.” Part of the conditions of Greece’s bailout program included sale of not one, but ten port authorities, including those managing the Port of Thessaloniki and Piraeus Port. If China had waited until Sri Lanka was in even more dire economic straits before negotiating, perhaps China could have secured military use of Hambantota Port, an even larger stake in the port for a cheaper price, an unbalanced trade and investment agreement, Sri Lanka’s rich mineral resources, or any number of political and economic concessions. Instead, China moved quickly and negotiated a deal that prioritizes the commercial success of the port. Leaving aside the factual inaccuracies and improper inferences, Pence’s characterization of the Hambantota Port case ultimately cannot account for why China negotiated the deal with Sri Lanka that it did. The broader narrative that Pence’s analysis represents, that of “debt-trap diplomacy,” fails to explain the case study that serves as its foundation. A narrative that so persuasively purports to explain the Chinese strategy behind the entire Belt and Road Initiative, that so stunningly fails to explain its own pet case, would be a terribly flawed foundation for US counterstrategy. It’s time to think differently.

III. ALL UNDER HEAVEN

A Global Order with Chinese Characteristics On May 14th, 2017, Xi opened the Belt and Road Forum for International Cooperation with a speech on the goals guiding the Initiative:

“We should focus on the fundamental issue of development … encourage greater cooperation between government and private capital … promote land, maritime, air and cyberspace connectivity … build an open platform of cooperation and uphold and grow an open world economy … [and] boost mutual respect and mutual trust among different countries.”

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Trump and Xi discuss the ongoing trade war.

Xi’s statements certainly should not be taken at face value. Rather, they should be deconstructed and fitted within the Communist Party’s policy tradition, to sep arate lasting principles from transient slogans. First, the linchpin to understanding the Initiative is Xi’s call for China to “focus on the fundamental issue of development” on the basis that “development holds the master key to solving all problems.” In Beijing’s view, issues such as representative governance, anti-corruption, environmental and labor standards, transparency, and fiscal discipline are products of development rather than necessary conditions for development. After all, despite its nondemocratic governance, widespread local and central corruption, devastating ecological damage, draconian lack of protection and support for migrant workers, infamous lack of transparency, and addiction to corporate debt and subsidies, China is one of the most rapidly developing countries in the world and is expected to contribute 27.2% of world economic growth in the next five years compared to 12.9% for India and 12.3% for the US. Research comparing democratic India to non-democratic China suggests that “a developed economy provides resources and key institutions protecting legitimate activities and delineating permissible ways of pursuing and using wealth,” and “offers alternatives to corrupt exploitation” that “a poor democracy, lacking those features of development”

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cannot. This claim that the resources gained through development can be marshalled to crack down on corruption has been supported by concrete results from Xi’s four-yearold “Sky Net” anti-corruption campaign, which captured more than 1,000 fugitives and recovered more than $519 million just last year. In contrast, India’s 2011 grassroots anti-corruption campaign, despite drawing millions of people into the streets, produced few concrete results. These are recent historical and empirical facts explaining why Beijing is deaf to the seeming hypocrisy of allowing corruption and low standards in the Initiative whilst claiming that the Initiative aims to promote good governance and high standards in host nations. Second, the anchor of the Initiative is Xi’s belief that “land, maritime, air and cyberspace connectivity” is the answer to the problem of underdevelopment. This is not a distinctly Chinese view, as international organizations such as the International Finance Corporation have reported “there is, indeed, a plethora of anecdotal and more technical evidence that better quantity and quality of infrastructure can directly raise the productivity of human and physical capital and hence growth.” Criticism of Belt and Road infrastructure is that it is expensive, unprofitable, underutilized, and therefore unconducive to development. Yet, from the Chinese perspective, most criticism based on infrastructure

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Chinese lenders hold 10% of Sri Lanka’s external debt, compared to Japan’s 12%.

The later successes of initially underutilized infrastructure projects both at home and abroad may explain Beijing’s confidence that projects such as Hambantota Port will become profitable over time.

utilization rates is overly myopic. Consider, for instance, the spectacle that foreign media coverage made of Ordos Kangbashi, a Chinese city mocked for being full of infrastructure but devoid of inhabitants and businesses. Years later, “China’s largest ghost city” is home to more than 153,000 people and 4,750 businesses, and only 500 of the 40,000 apartments in the city are still on the market. Looking abroad, we can see similar trends where infrastructure is initially underutilized, but later transformed into a driver of growth and trade. Consider, for example, the retroactively designated Belt and Road project, Piraeus Port. Piraeus Port, despite being Greece’s largest port, recorded throughput of just 660,837 TEU in 2009, suggesting the port was drastically underutilized given its excellent geographic position. In 2009, Chinese state-owned enterprise Cosco acquired management rights for half of the Greek port Piraeus. Under Cosco’s management, the company hired more than 1,000 new workers and invested $640 million to purchase modern cranes, construct a new quay, and plan a new floating dry dock. In the process, Cosco managed to triple business activity in seven years, leading merchant marine minister Miltiades Varvitsiotis to proclaim the deal “one of the most important and profitable investments to have happened in a global harbor.” In 2016, Cosco purchased a 51% stake in Piraeus, and in 2017, net income increased 68.6%. By 2018, throughput had increased to 4.4 million TEU. Even critics of China’s Belt and Road Initiative have admitted that China has successfully transformed Piraeus “from a backwater to a busy key transshipment terminal right where Europe, the Middle East, and Asia converge.” In short, the later successes of initially underutilized infrastructure projects both at home and abroad may

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explain Beijing’s confidence that projects such as Hambantota Port will become profitable over time, even though they initially fail to justify their sticker costs.

Ordos, briefly the laughingstock of the West, is now an ordinary city.

China Merchants helped transform Colombo Port into one of the fastest growing ports in the world.

Despite mainstream coverage of the Belt and Road Initiative as a grand strategy designed to counter US influence, China has invited the US and its allies to participate, which is an unusual move if it hopes to minimize US influence over projects.

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Third, the higher aspiration of the Initiative is Xi’s description of an “open platform of cooperation” that promotes “mutual respect and mutual trust among different countries.” This is perhaps the most overlooked aspect of the Belt and Road Initiative, dismissed as mere platitudes and slogans by strategists such as Chellaney who see only a “hegemonic sphere of trade, communication, transportation, and security links.” However, students of Chinese history can hear echoes of the Chinese concept of tianxia, translated as “all under heaven.” In the words of Laozi, the founder of Taoism, “a king could rule a state by his orders, win a war by strategies, but enjoy All-under-Heaven only by doing nothing to decrease the freedom and to deny the interests of people.” While this may initially seem to be concordant with US values of democracy and self-determination of peoples, in practice it has evolved into the principle of noninterference in other countries’ internal affairs. This principle was consecrated in China’s “Five Principles of Peaceful Coexistence” in 1954, and has served as the basis for China’s foreign aid policy through the Cold War. Beijing’s belief is that by offering assistance without trying to transform the culture and society of the host nation, it can help connect any developing nation regardless of its regime or structure to the world. In that sense, Beijing believes its Initiative is more inclusive than platforms such as the European Union or the Organization for Economic Cooperation and Development. Thus, Beijing’s rejection of conditionality in Belt and Road Initiative loans is indicative not of its disdain for democracy or market-based economics, but rather a culturally-rooted worldview traceable from the Zhou dynasty through the Cold War to the present. Additionally, despite mainstream coverage of the Belt and Road Initiative as a grand strategy designed to counter US influence, China has invited the US and its allies to participate, which is an unusual move if it hopes to minimize US influence over projects. Furthermore, the Asian Infrastructure Investment Bank, a Chinese-led regional development bank intended to help raise funding for Belt and Road projects, now has the second largest global membership behind the World Bank, including participation from close

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US allies such as the United Kingdom, Germany, Australia, Canada, and even Israel. AIIB President Jin Liqun has invited retired US World Bank experts to help structure and design the bank’s environmental and social framework, and cooperated with other development banks on two-thirds of its current projects. These developments do not fit with the narrative that the Belt and Road Initiative aims to undermine the existing international order or exclude Western influence. Instead, they lend credibility to Xi’s assertion that the platform strives to be open and inclusive. I V. S O - -

What? It may be worth trying to change China’s views on the relationship between corruption and development instead of assuming the worst about China’s intentions.

The purpose of this analysis is not to debate the finer points of authoritarian systems versus democratic societies, but rather to illustrate why Beijing may genuinely think that 1. Corrupt deals can ultimately produce less corrupt societies; 2. Massive state-financed infrastructure projects can jump-start development; 3. China’s platform can be more inclusive than the existing order. Pointing to corruption in Belt and Road projects as evidence of Chinese malintent fails to grasp a key difference between Chinese and US models of economic development. Judging underutilized infrastructure as evidence of failure and debt-entrapment relies on the faulty assumption that short-term results will be reflective of long-term returns. Interpreting the predominant role of Chinese capital and unconditionality of loans in existing Belt and Road projects as a sign of anti-Western neocolonial ambition is a massive logical leap. Understanding Beijing’s logic can help the US to shape future Belt and Road projects, because it opens the possibility of shaping Beijing’s decision-making instead of directly countering Beijing’s influence. Consider, for instance, the following hypothetical US response to the Hambantota case: The New York Times obtained documentation indicating that at least $7.6 million was transferred from China Harbor (a state-owned enterprise) to affiliates of Rajapaksa’s campaign in Sri Lanka’s 2015 election. Rajapaksa was driving force behind the Hambantota project, and the one who negotiated funding from China. The US could have advised the Sri Lankan government that there is international precedent in the 2006 case of World Duty Free Co. Ltd. v. Republic of Kenya which held that “bribery is contrary to … transnational public policy,” and that “claims based on contracts of corruption or contracts obtained by corruption” are invalid even if corruption is “common practice” in the relevant host state. The US could then have pointed out that when Ukraine refused to deliver uphold the terms of a $3 billion loan-for-grain agreement with China in 2014, China lodged a case against Ukraine at the London Court of International Arbitration instead of taking unilateral punitive action, suggesting that Chinese leverage in such cases is limited, and that Beijing must rely on international enforcement to extract repayment if Sri Lanka refuses to honor its contract. Combining the two, the US could have suggested that Sri Lanka challenge China’s debt claims in international court on the grounds that bribery and corruption tainted the contracts, supported Sri Lanka with legal expertise and factfinding intelligence personnel, and in this manner provided Sri Lanka with leverage to renegotiate its loans with China. In a recent study of 40 cases of China’s external debt renegotiations the Rhodium Group found that “many of the cases reviewed involved an outcome in favor of the borrower, and especially so when host countries had access to alternative financing sources or relied on an external event (such as a change in leadership) to demand different terms.” Aiding Sri Lanka with legal and investigative expertise in this manner is not only cheaper and more efficient than attempting to match China dollar for dollar with foreign investment, but it also prevents the Belt and Road Initiative from turning into a Cold War style competition. Instead, it demonstrates to China that corrupt deal-making is incompatible

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with its vision of international development, and that China faces more than just reputational risks if it continues to tolerate corruption in the Belt and Road Initiative. Such a response assumes that China’s endgame is not bribery in itself, or in other words, that China is not attempting to capture the political leadership of host nations via entrapment and corruption. If that were the case, then this response to the Hambantota case would only push China to better conceal the corruption involved in its deal-making, and worsen transparency. But given China’s revealed preference for negotiating a quick deal with Sri Lanka instead of waiting to extract maximum leverage (as discussed in detail in Section II), it may be worth trying to change China’s views on the relationship between corruption and development (as explained in Section III) instead of assuming the worst about China’s intentions. After all, this is precisely the type of high reward, low risk response that makes use of the US’s comparative advantages: its sway in international institutions and its superior intelligence gathering capabilities. It is less likely to escalate zero-sum competition with China, less likely to dig a deeper hole in the US budget, and more likely to inspire other debt-saddled countries to seek US assistance when renegotiating loans with China, a win-win-win proposition.

V. C O N C L U S I O N

Buying the Straw Man Would Double the Deficit Ideally, these counterstrategies will emphasize tools befitting of the 21st century such as intelligence-gathering and international law, not carriers and carrots.

The Trump administration has acted swiftly to counter the Belt and Road Initiative, signing the BUILD Act to establish the US International Development Finance Corporation, a vehicle armed with $60 billion to “provide financially-sound alternatives to state-directed initiatives that can leave developing countries worse off.” Pence has pointed to US business investments of more than $1.4 trillion a cross the Indo-Pacific as evidence that developing nations need not rely on the Belt and Road Initiative for their financing needs. On one hand, it’s encouraging to see the administration formulating some type of coordinated response. On the other hand, this is also the type of response that will be most resource-intensive and most likely to transform development financing into a full-on competition between the US and China. We have explored three keys that guide Chinese decision-making with regard to the Belt and Road Initiative: development, infrastructure, and noninterference. They do not comprise an eight-hundred-page memorandum on how every Belt and Road project is connected to maximize China’s political leverage, because no such memorandum exists. In fact, Beijing has issued central guidelines specifically demanding that the Belt and Road be translated as an “initiative,” not “strategy” or “agenda,” precisely to discourage this misconception. Knowing these keys allows the US to tailor cost-effective responses that do not depend on large-scale spending programs. Instead, counterstrategies can be shape China’s understanding of corruption in relation to development, debt in relation to growth, transparency in relation to inclusivity, and other points of disagreement on best practices. Ideally, these counterstrategies will emphasize tools befitting of the 21st century such as intelligence-gathering and international law, not carriers and carrots.

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SHIFT+CMD+CLICK Societyto&change Culture individually

FORGOTTEN FUSIONIST R E V I E W

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《追寻共和国： 张东荪早期思想 与活动研究》 1886-1932 Text // Zheyan Ni Image // The Paper News and Sohu

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o historians of Modern China, Zhang Dongsun cannot be more familiar. Yet outside of academia, he is almost unknown by the general public. Highly politicized historical narratives of twentieth century China only canonized winning or losing figures during the rise of the Chinese Communist Party: Sun Yat-sen, Yuan Shikai, Mao Zedong, etc. As the famous historian Yu Yingshih once perceptively put, there are no true conservatives in modern China— they are simply less radical. Those, including Zhang Dongsun, whose ideas were deemed too conservative in the urgency of nation-building, are ultimately forgotten. An overarching effort in Zhang’s intriguing intellectual career was to generate a synthesis of the Confucianism sage-hood philosophy of self-cultivation and the Western moral philosophy of rationality and democracy, represented best by Kant and Russell.

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Zhang Dongsun was born in Hangzhou on the eve of the Qing Dynasty’s fall. Traveling to Japan to study at the University of Tokyo, he studied the epistemology and ethics of Kant and propagated Western philosophy in China during the New Culture Movement. After returning to China, he taught at the National Tsinghua University in the 1930s and 40s while writing and editing articles for several philosophy journals. After the establishment of the People’s Republic of China, Zhang served in the central governmental committee. However, during the Cultural Revolution, he was imprisoned and died miserably in 1973 under the accusation of leaking secret information to the US government during the Korean War. In this book of over 400 pages, historian Gao Bo, a lecturer at Chinese Renmin University, endeavors to reanimate the voice of Zhang Dongsun and the legacy of his political thoughts in light of his intellectual and political career. Gao consults primary sources from Zhang Dongsun’s own written works and 43 journals, newspapers, and magazines of various kinds, including political commentaries, philosophical essays, and news reports. He also reviews secondary literature about Zhang Dongsun (including excerpts from books by historians Yang Kuisong, Zhang Pengyuan, and Yu Yingshih) and writings on Western political philosophy, as well as modern Chinese intellectual history, more broadly, from both Chinese and Western sources.

Gao Bo

Chinese Renmin University lecturer

Adopting a chronological structure, Gao Bo traces the development of Zhang Dongsun’s intellectual thought from his youth to his later years, even throughout his involvement with the PRC government. The book is mostly narrative-based, coupled with Gao’s balanced analysis and critique of Zhang’s ideas set against the historical context and Zhang’s own life background. The book is also comparative in nature, juxtaposing Zhang with other intellectual and political giants at his time, such as Liang Qichao, Fu Sinian, and Mao Zedong, thus providing a flavor of the diverse and debate-ridden intellectual landscape First, it is crucial to underline the historical context of intellectual debate at the turn of the twentieth century. Zhang Dongsun was born in 1886 among the last generation of literati (shidafu people from well-educated families who obtained access to the ruling class by taking the imperial civil examinations). By the late 19th century, the meritocracy system based on imperial civil examinations was gradually losing its grip on its importance as a centerpiece of Chinese society. China was just beginning to absorb Western concepts of liberal democracy and science imported from Japanese scholars. Zhang Dongsun was among the first generation of students to study abroad in Tokyo and to examine the roots of China’s despondency. In this book, Gao actually makes a fair case for Chinese conservatives who constantly struggled to have their ideas be accepted by the historical mainstream. Zhang Dongsun epitomized this conundrum. A suggestive example is Gao’s analysis of Zhang’s agenda of “governance by sages,” or xianren zhengzhi (贤人政治). Zhang’s xianren paradigm was influenced by Italian sociologist Robert Michels’s elite theory, which argues that political elites cannot be truly democratic because they would quickly form oligarchies. Zhang also suggests that the formation of elite power-holders is inevitable, but they should still embrace ethical integrity and social responsibility to exercise the power on behalf of the public. Therefore, a bit different from the oligarchy model in which elites are defined solely in terms of political capabilities and resources, the identity of xianren can only be endowed to those who possess both moral integrity and excellent capacity to partici-

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pate in political affairs. Accordingly, Zhang had an ambiguous attitude towards universal election as the basis of democratic liberty because by his logic, universal election might end up selecting unqualified candidates for xianren politics. Zhang also cautioned against the use of congress, which, he argued, should not exercise substantive political or legislative responsibilities beyond basic political consulting and helping citizens to vent their emotions and opinions. This belief is probably driven by Zhang’s “conservative” temperament. First, Zhang brought up this argument in November 1917 when the newly founded Republic of China fell under the tyrant of then president Yuan Shikai. Frustrated with the failure of congress, Zhang looked to the Confucian sage model for solutions. Second, as Gao portrays, Zhang was never willing to stand firmly against the Chinese traditional political philosophy even when it was most vehemently attacked during the May Fourth Movement. Zhang’s idea, according to author Gao Bo, contradicted the overwhelming plea for more political rights and access to the policy-making process. In other words, the public was demanding a more thorough application of republican democracy than the one Zhang offered. At a time when it was stylish to play the “progressive” card and affiliate oneself with various “isms”, Zhang’s agenda seemed too vague and conservative to be embraced by any intellectual or political camp. But why did he insist so? According to Gao Bo, Zhang Dongsun sees the fundamental gap between elites (literati-officials, gentry) and commoners (ordinary people, mostly illiterate such as the peasants) as the most scathing obstacle for China to practice politics of any kind. For Zhang, expanding participatory politics could be risky since common citizens are not capable enough to contribute meaningfully to policy-making deliberations. Tra-

ditional elites, however, lack incentives to speak up for the commoners. In this case, xianren can represent the general public in political conversations and serve as a mediator to narrow this gap. This governance by sages system transcends the debate over what kind of national or political system China should adopt. The primary concern for Zhang Dongsun was always about the human factors behind institutional constructions, and the process for cultivating citizens suitable for a participatory polity. However, this claim disappeared into insignificance when compared to the urgency of nation-building in material and military terms in the 1920s and 30s. Towards the end of this book, Gao clearly notices a major shift in Zhang’s ideology in the 1930s: he began to identify closely with Social Darwinism and subscribe to the comprehensive social engineering proposed by the Communist Party. In Gao’s analysis, Zhang compromised his previous concern with individual self-cultivation in the face of prolonged social instability, warfare, and revolutions, which centered “society” as the main target of transformation. Here, we can see that the rise of socialist thoughts in China had a sweeping impact on China’s intellectual landscape. Examined from a broader historiographical scale, modern Chinese historiography is inflated with hagiographies of canonized historical figures. In light of this trend, this book provides a critical lens to understand those “conservative” voices that are equally meaningful and revealing, though Gao’s facts-heavy writing style may put off some readers who do not enter with much background knowledge. Still, readers who are interested in Chinese modern philosophy and intellectual history should not miss this book.

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S H A D OW O F C U LT U R A L R E VO L U T I O N R E V I E W

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《故园的背影》 Text // Zheyan Ni | Image // Google Images

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uyuan de Beiying《故园的背影》(Retreating Figures in the Garden of the Past) consists of a series of memoirs written by Chinese students enrolled at Hunan Normal University in the early 1980s who later moved abroad to study and work in the United States. These stories vividly portray the authors’ memories of their fathers, many of whom are intellectuals themselves with roots in well-established families that valued education and personal merit. However, when the Cultural Revolution struck, many of them were politically persecuted, imprisoned, publicly humiliated, and deprived of any chance of social mobility due to their undesirable backgrounds. The “capitalist stigma” imposed by wide-spread political fanaticism also barricaded the abilities of their sons and daughters—the authors of these memoirs—to receive education and expand college and graduate schools, and studied abroad in the US where they settled down. Decades later, they are now leading contributors in academia, science and technology development, business and finance. The dominating masculine perspective in this book is paramount to setting the basic tone of the narratives. Most images of their fathers convey impressions of mentors imparting philosophy, life, and career to the children, while lacking details of everyday life activities. For example, authors tend to recall the time when their fathers were studying and reading books, working in the office, teaching children, or socializing with neighbors and friends. By contrast,

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memoirs of mothers and grandmothers in other literatures are often filled with everyday life moments, such as dining, making and wearing clothes, farming or laboring, as well as marriage and child-rearing related to personal choices and values. In other words, memoirs about one’s father and mother represent a public versus private life dichotomy. Fathers are always viewed as historical agents that belong to the public domain. From this book, one salient crux is that, experientially speaking, the generational gap in historical context for the authors and their fathers is unimaginably huge: personal merit and educational background were a curse for their fathers to struggle with. They were matters of life or death, yet the same qualities were precisely what empowered the authors to not only achieve career success and personal worth but also to save their families from misery. With this gap in mind, the very act of recounting becomes quite intriguing. Knowing life’s turbulence from their youth but currently leading a satisfying life in their 40s and 50s, these children ultimately became authors able to compose and evaluate the history of their fathers. These memories are composed of chronologically fragmented moments—factually blurry but emotionally firm and animated. For example, some authors cannot even remember their fathers’ faces, much

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When many voices and images are being lost or forgotten in the mists of chaotic eras, sometimes due to political censorship, how can we delineate a clear storyline to rescue memory? less the details of their shared experiences. However, almost all authors revere their fathers as their moral icon and spiritual torchlight. Many mention that their fathers embody the unyielding virtue of integrity and the spirit of public service even during the most demanding and humiliating moments. Raising children to become college graduates in the 1970s was extremely difficult given the anti-intellectual political climate, pervasive poverty, and constant revolutions. The father-children relationship in this book has become a symbol of hard-earned family mobility in virtually all aspects: material wealth, family honor and tradition, personal achievement. Generational memoir is a common and powerful genre in modern Chinese historical literature, epitomized by Jung Chang’s Wild Swans: Three Daughters of China and Zhu Ziqing’s Retreating Figure. Memories of parents in early People’s Republic of China leave indelible marks about everyday political and economic life at that time. It seems that, in this book, no one can escape the Cultural Revolution, severe poverty, famine, and lack of personal choices imposed by the planned economy and the Great Leap Forward. No one can treat the year of 1978 as just another normal year. It is a crucial turning point where the fathers had attached tremendous hope and expectation to their children, wishing they could fight their way out of the historical abyss of political chaos. The authors mourn the fact that their fathers’ talents,

skills, ambitions, and moral virtues were “wasted” by history. More broadly conceived and taken as a whole, these memoirs constitute an epitaph of a generation of talents withered away by historical trauma. It is also worth noting the subtleties behind the title of this work and the meaning it lends to these emotional stories. Beiying (the silhouette or shadow of a retreating figure) is quite suggestive: a glimpse into a desolate character that is receding slowly into the dusty and secret garden of history. Beiying is a commonly invoked connotation in Chinese historical writing, which implies a modest stance that the author takes to commemorate the persona because the writer is quite aware of the obscurity and challenge of historical writing of modern China. When many voices and images are being lost or forgotten in the mists of chaotic eras, sometimes due to political censorship, how can we delineate a clear storyline to rescue memory? When memories themselves are scattered around in fragments, who would care to read the last appearance of that retreating figure before he disappears permanently from history? Fortunately, unlike other heavy and serious writings about trauma, Guyuan provides a collection of not-so-bitter voices for us to understand the conundrum of why and what we should remember about individuals in historical suffering.

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EVIL’S FIRST SOFT TOUCHES: Evil’s First Soft Touches:

Uyghur “Re-Education” in China Text // Angela Lu Image // Council on Foreign Relations, Luis Dafos, and Matteo Colombo via Getty Images

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ince April 2017, as many as 1 million Uyghurs and members of other Muslim ethnic minority groups have been indefinitely detained in an ever-expanding secretive network of extrajudicial re-education camps across Xinjiang province. China’s rulers have long held a deep suspicion of Xinjiang’s ethnic minority groups, whose members account for more than half of the provincial population of 24 million. Comprising the vast majority of Xinjiang’s ethnic minority population, Uyghurs have a distinct religion, language, and culture that’s far more similar to that of China’s Central Asian neighbors than its own Han Chinese majority. Importantly, they have a history of independence and separatist movements, largely based on ethno-nationalist arguments for a homeland for Turkic-speaking Uyghurs. Stretching 1.6 million square kilometers from the Tibetan plateau in the southeast to Kazakhstan on its northwestern border, Xinjiang is by far China’s largest administrative region. Bordering eight countries and rich with oil and natural resources, it is also one of China’s most vital regions from a strategic standpoint. Tensions have long existed between the Han majority and the Muslim Uyghur population in the autonomous region officially called Xinjiang but known indigenously as East Turkestan by its local population. In July 2009, ethnic tensions boiled over in the capital of Urumqi, where clashes between Uyghurs and Hans left over 140 people dead and hundreds more injured.

The riot reflected deep-seated frustration felt by many Uyghurs towards the tight control asserted by the Communist Party. A series of sporadic Uyghur attacks against the Hans continued over the ensuing years, reaching a peak in 2014 and prompting the launch of a “people’s war on terror” designed to exert greater control of the Uyghur population.

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Amid the rising Islamophobia in China and protracted conflict, Communist Party officials have responded by creating a surveillance state in Xinjiang. In 2016, Chen Quanguo, who previously spearheaded the implementation of the “grid-style social management” system in Tibet to restore stability, was appointed as Party Secretary in Xinjiang, where he has orchestrated the detention of Uyghurs. As part of this suppressive campaign, Chinese authorities have diluted Uyghur language and culture and targeted Muslim religious practices and customs, banning beards, religious instruction of children, and the granting of names with religious connotations. A central part of the Chinese government’s efforts is a digital surveillance program involving widespread installation of facial recognition technology and collection of DNA samples on an unprecedented scale.

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Many Western reports have likened Xinjiang to a police state, with police questioning Uyghurs on the street without cause, demanding to know what they’re doing, where they’re going, and why. Xinjiang’s cities are scrambling to hire police after regional government spending on public security nearly doubled in 2017. Furthermore, many foreign news outlets and non-profit organizations have documented physical and psychological abuse inside the camps. The Associated Press reported that Uyghurs were forced to disavow their beliefs, praise the party, and endure solitary confinement. An AFP investigation in 2018 examining more than 1,500 publicly available government documents found evidence that the camps are run more like jails than schools, with police uniforms, riot shields and helmets, pepper spray, tear gas, stun and net guns, electrified batons, handcuffs, and billy clubs. Human Rights Watch discovered that former detainees were jailed without hearings, shackled, and beaten. One main impetus for the Chinese government’s intensified efforts to control the Uyghur population is President Xi Jinping’s signature Belt and Road Initiative–a trillion-dollar plan to finance a vast network of new ports, highways, roads, energy pipelines, and modern infrastructure projects in developing countries that promote economic integration from China through Asia, the Middle East, Africa, Europe, and beyond. Due to its geographic location, Xinjiang serves as an important nexus for a several such key projects, including the New Eurasian Land Bridge, the China-Pakistan Economic Corridor, and the China-Turkey Corridor. Because the unrest and instability in Xinjiang could discourage potential investors, the Party has sought to pacify the region, ease concerns about violence and lawlessness, and ultimately

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reassure investors that it is a safe place to live and to work. China refuses to back down on what it views as its highly successful deradicalization program in Xinjiang. Nonetheless, perhaps in response to growing international pressure, the Chinese government has become more sophisticated in its approach towards legitimizing and crafting a narrative around what is happening in Xinjiang. After initially issuing several blanket denials in response to reports of mass incarceration, Beijing changed its official position after the UN raised alarm in August. As early as October 2018, authorities began to covertly send detainees to Heilongjiang province in the far northeast of China to address overcrowding in camps. Now, many are being sent to Shaanxi and Gansu provinces, a move some view as a bid to obfuscate the mass scale of detention in Xinjiang. Around the same time, China began an ardent defense of the program, calling it a counter-terrorism measure to purge Islamist extremism from the vast, unstable territory bordering Central Asia. Authorities claim that strict security measures are necessary to combat the influence of extremist groups. By framing its efforts against the Uyghur population in the language of counter-terrorism, Beijing aims to show itself to be a responsible member of the global community, ostensibly playing by the rules of the international system while sidestepping human rights concerns. Beijing has faced a slew of international criticism and denunciation over its tactics in Xinjia ng that have escalated in the past several months with increased Western reporting, academic research, and investigation by human rights NGOs. Last August, a UN human rights panel confronted China over credible

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reports about the “massive internment camps” holding a million or more Uyghurs. In November, six UN officials and human rights experts sent a letter to the Chinese government opposing new regulations seeking to provide a legal basis for mass internment as a countermeasure to religious extremism. In the letter, they contended that the regulations were “incompatible with China’s obligations under international human rights law” and that the new regulations relied on overly broad definitions of extremist behavior, essentially criminalizing the legitimate exercise of basic rights. That same month, a total of 278 scholars in various disciplines spanning dozens of countries urged the international community to take action against China over its “mass human rights abuses and deliberate attacks on indigenous cultures presently taking place in China’s XUAR [Xinjiang Uyghur Autonomous Region].” In January of 2019, as part of a broader tougher tack against China, US lawmakers revived a bill–the Uyghur Human Rights Policy Act–that could pave the way for sanctions against China for its actions in Xinjiang. In February, human rights activist groups, including Amnesty International and Human Rights Watch, began urging European and Muslim nations to take the lead in establishing a UN investigation into China’s arbitrary detention. They are appealing to the UN Human Rights Council, which opens its main annual session on February 25th, to send an international fact-finding mission to Xinjiang. Moreover, in a change of tune, Turkey denounced China’s detention of Uyghurs in Xinjiang, calling it a “great shame for humanity.” In a presentation to the UN Human Rights Council in November 2018, China defended its camps as not only a counter-terrorism measure but also crucial vocational training centers aimed at improving the economic

prospects and living standards of ethnic minorities. In the same month, the State Council Information Office issued a white paper titled “Cultural Protection and Development in Xinjiang,” trumpeting the government’s wide-ranging protection of ethnic cultures, including languages, religions and cultural heritage, of Xinjiang. To reinforce the official narrative, China has even gone so far as to take small delegations of diplomats and journalists on meticulously managed visits to Xinjiang. Even so, an EU delegation supervised by Chinese officials on a 3-day trip in January 2019 reported that the visit provided “forcing, and mutually consistent, evidence of major and systematic human rights violations in Xinjiang.” China’s increased suppression and more sophisticated tactics in Xinjiang come at a time when China is trying to play a more central role in leading the international order. In addition to its increased economic, military and political might in the last decade or so, China has more recently emerged as a pivotal player in the international human rights system. According to a report by the Brookings Institution, China’s leverage on the world scene has grown and its tactics have become more proactive since Xi Jinping was elected president in 2013. China’s actions and narrative of Xinjiang are core to a wider and more wholesale campaign to reshape the rules and instruments of the international human rights system and challenge or co-opt some of the key values upon which the US-led liberal international order rests. It remains to be seen whether the international community will respond with force or allow China to continue to chip away at the values that underpin the existing international system. If the international community adopts a sufficiently strong stance, then China may be forced to reconsider its Uyghur policy or risk losing soft power and influence.

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DRY CHINA Text // Jack Morganjones Illustration // Irene Chung

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he consensus among foreign policy experts is that the threat of water wars should not be overstated. Historically, there have been remarkably few examples of violent conflicts over water. In the 20th century, those which did occur were mostly between Israel and its immediate neighbors, suggesting that the root causes cannot simply be attributed to water. Moreover, a study from 2003 found 157 examples of international water treaties, suggesting that water scarcity actually fosters multilateral solutions rather than lead to conflict. But however unlikely the water wars of an apocalyptic future seem, such things cannot be so easily dismissed when it comes to China. In China, a dry and violent future is a serious possibility. China is a country where 70% of the surface water is unsuitable to drink. The situation is so dire that in the countryside there is an ongoing phenomenon of “Cancer Villages”– villages which cluster around polluted rivers and where the risk of gastric cancer can be up to nine times that of the normal rate. But China’s water problems far exceed the simple drinkability of water. They are increasingly diverse, increasingly complex, and seem to be increasingly insoluble. In the north, high speed winds drive the sands of the Gobi Desert into China. Beijing is blasted by the advancing desert sands, which can cause air traffic to stop and even obscure skyscrapers from view. Further north, in the province of Inner Mongolia, average rainfall has decreased by 10% since the turn of the century, and the northern deserts are now spreading at an astonishing rate of over 1,000 square miles annually. American geologist Frederick G. Clapp once said while walking the Great Wall in 1920, “one foe alone has not been stopped by the Great Wall. This was the sand of the Desert of Gobi.” Almost one hundred years later, China still faces the same foe.

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In the west, the drying up of glacial-fed watersheds has caused the gap between the Taklamakan and the Kumtag Desert to grow smaller and smaller each year. But in Xinjiang province, water allocation is an even greater source of conflict than water scarcity. There are regular disputes over the quota system which provides access to the Tarim Basin. This problem is exacerbated by the fact that local authorities cannot enforce water allocation quotas between upstream and downstream water users because the Chinese military oversees cotton growing in the region and has considerable political influence there. In the east, water quality is a major issue. Massive demonstrations occurred in Zhejiang province back in 2003, which successfully pressured the municipal government into constructing wetlands, water treatment plants, and a bio-gas system. However, this action was only a minuscule step forward. Academic studies from 2018 show that water quality remains a major problem: The Grand Canal, an important source of drinking water for Hangzhou, contains organic pollutants which present health risks to both drinking and bathing. Hidden threats to public health in the future also exist. For example, a study into E. coli revealed that in the Qiantang River and Dongtiao Stream, the two main rivers providing water to the Zhejiang provincial capital of Hangzhou, 49.50% of E. coli were resistant to at least one of the tested antibiotics, and a worrying 24% exhibited multiple resistances. In the south, water is especially concerning when one looks at regional problems in a nationwide context. Cities such as Guangzhou have experienced what geoscientists call “rocky desertification”, referring to large-scale human activity which transforms vegetation and soil into rock and concrete. As moss and algae can absorb 3 to 15 times more water than carbonate rocks

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to support vegetation growth, it is alarming that large areas lack moss and algae growth, exacerbating the desertification problem. This problem has been long in the making– ever since the Great Leap Forward when trees were stripped to make charcoal for iron production – but it also foreshadows a latent threat when one considers the government’s South-North Water Transfer Project which intends to rely on the captured waters of the south to support the drying-up north.

Today’s simmering could well be the beginning of tomorrow’s explosion.

Frederick G. Clapp proposed a solution to the advance of the Gobi Desert in 1912, “A new Great Wall should be constructed, not of brick or stone or guarded by soldiers, but a forest barrier guarded by expert foresters.” Interestingly, this is now being done. In 2007, the Chinese government approved the Million Tree Project, which has now planted over 1 million trees in forest areas covering over 2000 thousand acres. The project will surely do environmental good in a general sense, but China’s desertification problem is far too complex to be solved by such a generic solution. Indeed, the project coordinator for Inner Mongolia, Wang Kai, admitted that planting trees could in fact be depleting groundwater, which would mean that the project is inadvertently worsening desertification. The water problems China faces cannot be solved by simply throwing money around. The South-North Water Transfer Project is a project worth $81 billion and yet it has only marginal payoffs – it is estimated by Professor Dabo Guan that it will only supply Beijing with 5% of city’s overall water needs by 2020. In the past, water problems have been solved most successfully when they have been tackled internationally – the Indus Waters Treaty even managed to bring Pakistan and India together and the UN Convention on the Law of the Non-Navigational Uses of International Watercourses, although not ratified by many, nevertheless is used by many nation-states to collaborate. But China’s problems are internal, and so cooperation will have to come from within… but from where and by whom? As an authoritarian one-party state, the government owns all of the water resources in the country and manages them with the help of the military. The Ministry of Water Resources implements water resource allocation as they see fit; other voices for change are rarely engaged with seriously, so there are no alternative ideas being heard, leading to unproductive initiatives and stalling progress on China’s dire water issues. As China is not exempt from history, its best hope to solving its water problems involve a critical mass of multilateral thinking. Given that the water crises in China is not a dispute with an adversarial state, this multilateral thinking would, therefore, need to come through non-state actors, such as activists, journalists, and academics. Although the municipal government did respond to the aforementioned 2003 water quality crisis in Hangzhou, the conversation was not allowed to continue. Environmental activist Tan Kai, who argued for further reform, was put in prison in 2005 by a Hangzhou court for “illegal access to state secrets.” Journalists have slightly more leeway than activists. In July earlier this year, the publication Sixth Tone ran a feature revealing how the average daily water flow from wells in Si County, Anhui province has decreased from 80,000 liters per well in 2005 to 10,000 liters per well in 2018. The difference is only slight, however, as the ability of Chinese journalists to combine such a story with challenging opinions, and from this create meaningful public discussion, is markedly limited. The record of

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press freedom in China, ranked by Reporters without Borders as the 176th country in the world, is well documented. Given the risks of arbitrary imprisonment, journalists cannot play a constructive oppositional role to the state. As Hu Shuli, the founder of the relatively confrontational paper Caixin, said: “We go up to the line — and we might even push it. But we never cross it.” Even Chinese academics, who are perhaps the group which has the most freedom to speak their mind due to a lack of public outreach, still talk about their subjects on tenterhooks and avoid pejorative language. Their papers offset findings with provisos which preemptively clarify that water is, of course, a global issue which effects multiple countries besides China. The water problem is a bigger problem than China, but not just because it’s a global issue. It is bigger than China because the Chinese water problem does not seem solvable by the Chinese government alone. Further, if the government continues to not engage with and involve other actors in confronting the problem, this may lead to fatal errors. The evidence suggests that the CCP does not have the wherewithal to manage this water crisis on their own. So far, their response has been large scale and old school. While China’s water problems are such that they certainly do require large scale solutions, for these solutions to work they need to be consistently applied and sustainable. The CCP’s record does not lend itself to either of these qualities. Wang Canfa, an environmental lawyer, has estimated that only 10% of environmental laws and regulations are enforced properly. But even if the CCP were to become reliable, this would not mean much if their blueprint for managing the water crisis was flawed from the outset. Specifically, the government still has a tendency to fund old school solutions. A report from the Nature Conservancy recommended conservation strategies in China that use natural solutions to target small to medium sized catchment areas. Such a data-specific plan seems in stark contrast to the South-North Water Transition project, the premise of which is to move rivers – an idea that can be traced back to Chairman Mao Zedong in 1952. In 2013, the Harvard International Review ran a feature arguing that the old Malthusian tropes of resource scarcity were being recycled – only this time they were being used to imply the strong likelihood of water wars. Like before, the piece went on to argue, economics and technology would ultimately undo this Malthusian fate. “No Water Wars, Water Deals” as one subheading read, before pointing to various good examples of how water conflict had acted as an emollient between peoples and progress had been made. The one example not mentioned was that of China. Water wars are traditionally thought of as occurring between nation-states. This might be too legalistic a definition. Historically, internal conflicts can be just as bloody – China’s Taiping Rebellion in the 19th century is reported as having the highest death toll in world history. Whether the CCP fails or succeeds, its short-term balancing act approach to China’s water crisis clearly has the potential to stoke regional animosities. It’s been a whole two decades since the Three Gorges Dam project forcibly relocated 1.2 million people, and the lack of compensation still provokes hundreds of petitions from the victims. Yet the Chinese government is intransigent and repeats the same mistakes – ploughing on with their plans to increase the production of coal in Inner Mongolia despite the highly water-consuming venture being in an area much in need of water for irrigation. And Xinjiang, a repressed province where Muslim Uighurs have launched armed insurgencies and where the government is suspected of interning up to 1 million people in counter-extremism camps, is a province beset by water troubles. Today’s simmering could well be the beginning of tomorrow’s explosion.

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A WAR OF

VISIBILITY CONTRADICTIONS IN CHINA'S E N V I R O N M E N TA L P O L I C Y Text // Jasmine Gan | Image // Joe Sanders, PTI, CNN, and Washington Post

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n October 10, 2018, the Intergovernmental Panel on Climate Change urged governments to recognize the drastic trajectory of the climate in a special report, “Global Warming of 1.5°C”. To contain global warming to 1.5°C (2.7°F) above pre-industrial levels, the world needs to cut down carbon emissions at unprecedented levels: essentially halving emissions by 2030 and eliminating them entirely by 2050. International response to the report has been mixed. European countries have taken up the call for new policies aligned with the 1.5°C goal. US President Donald Trump has yet to release a statement and has not strayed from his 2017 plans to withdraw the US from the Paris Agreement. Under the current presidency, the decline of US emission levels slowed in 2017, and the emissions level is projected to actually increase in the following years. In Beijing, blue skies have appeared again as observers proclaim signs of success for Xi Jinping’s vision of China’s future as an “ecological civilization”. It has been four years since China first declared its War on Pollution, with very visible results: after years of topping the WHO’s list for deadly outdoor pollution, major Chinese cities have welcomed sporadically increasing numbers of days without smog, with a 53 percent drop in overall pollution. Life expectancy of residents has shot up by months. In 2017, there were 160,000 fewer premature deaths from pollution.

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POLLUTE FIRST, CLEAN UP LATER?

IS DEVELOPMENT AND ENVIRONMENTAL DEGRADATION TWO SIDES OF A LUCRATIVE COIN? But not everything is sunny in Beijing. Criticism has been leveled at China’s aggressive policies for the reckless haste of officials in implementing edicts from the top. A sudden mandate in Hebei to switch from coal resulted in shortages of alternative sources of fuel for heating, and lack of adequate research meant that provincial goal-setting was sometimes arbitrary. Outside of China, the leviathan Belt and Road Initiative (BRI) has been slowly easing forward at a resolute pace since Xi announced his road map to achieving the “Chinese Dream” in 2013. Chinese investment in infrastructure projects under the initiative crown at $4 trillion this year, with a vision of covering the globe in shipping and trade routes centered on China as the node of the network. Such a grand design no doubt has its costs. So far, the environment has borne the brunt of these costs, as China puts aside environmental scruples to roll out infrastructure building projects. International concern for sustainability and environmental degradation have already prompted Xi to adopt the Green Silk Road Initiative in 2016, but visible correction beyond oft-repeated rhetoric has yet to be seen. Are these troubles merely hiccups in China’s strides on the path towards its status as an ecological civilization or has the Party’s recent performance been just for show? In 2012, China watchers identified a distinct “discursive shift” in the upper echelons of the Communist Party of China (CCP). The concept of “ecological civilization” was officially included in the Communist Party Constitution, five years after it was first introduced by Hu Jintao. From that point forward, China ostensibly started the shift from an “industrial civilization” to one that no longer prioritizes economic growth at the cost of environmental degradation. In 2016, China ratified the Paris Agreement and Copenhagen Accord. In 2017, it met its 2020 pledge to cut its 2005 carbon intensity levels an astounding three years ahead of schedule. In March of this year, the CCP established the new Ministry of Ecology and the Environment, with the specific mandate of preventing pollution and contamination of China’s air, water and land. So far, this ministry has been occupied with cracking down on polluters and contamination at home, yielding clear results. China’s War on Pollution has made visible changes and improvements to air quality. Last year, China announced its controversial waste ban: it would no longer accept imports of waste from foreign countries, which previously constituted half of the world’s paper, metal, and used plastic waste.

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ident’s consistent denial of climate change has led to promised American withdrawal from the Paris Agreement, essentially creating a leadership vacuum and the perfect opportunity for China to become the new international standard-bearer for environmental reform. Xi has solemnly taken up the mantle, declaring his intent for China to take a “driving seat” in the global fight against climate change as part of his long-term vision to make China a leading global power by 2050. In August, the China-Africa Cooperation Center took the first steps towards launching a China-Africa Environmental Cooperation Center. It certainly appears as though China is not just talking the talk but also walking the walk.

Despite this, China has still retained its title as the world’s biggest gross emitter of carbon emissions, producing a little less than a third of the world’s carbon emissions from fossil fuels. China’s environmental troubles over its course of economic development provides a test for economist Simon Kuznets’ theory. This theory, represented by the Kuznets curve, posits that as a nation’s economic development proceeds from a rural agriculture society to an industrialized urban society, social inequality will increase, peak, and finally decrease, deriving the shape of an inverted U curve. Kuznets theorized that as economic growth boosts society to a tipping point, the rest of society will be able benefit from a trickle-down effect as the state is able to enact welfare and social safety net policies. The concept of the environmental Kuznets curve co-opts this logic by replacing social inequality with environmental degradation on the horizontal axis, which some say is exactly what is happening in China today: China’s massive economic growth has finally given it the capability to invest money in protecting the environment. By international standards, China is doing an outstanding job in combating climate change. In the same year that “ecological civilization” became part of the CCP constitution, Donald Trump claimed that climate change was an elaborate Chinese hoax, as an instrument for economic dominance. The US pres-

But is China adhering to the spirit or the letter of climate change mitigation? Although Beijing has met its goals, the initial commitments it made were been ranked as insufficient by independent research agencies: if all governments had goals within this range, net warming on Earth would be between 3-4°C, well over the Paris Agreement’s limit of 1.5°C. Further, the environmental impact of BRI infrastructure projects cannot be ignored: while Chinese officials scramble to eliminate coal as a source of fuel at home, BRI investments include the construction of over 240 coal-fired power plants in 25 developing countries, many of which do not have sufficient capability to limit damage to air quality and environmental pollution in their own home countries. In 2016, a tribunal under the UN Convention of the Law of the Sea ruled that China had caused “severe harm” to the coral reef environment in the South China. The reclamation of land, dredging of coral reefs, and construction of artificial islands to house military hangars resulted in the endangerment of the 6000 fish species and 600 coral species inhabiting the reefs. Chinese fishermen have also harvested endangered species of sea turtles, coral and giant clams at a “substantial scale”. Since China has scraped the reef surface in order to pile sand for building islands in the contested waters, reef cover has dropped by 70 percent in a short three years, on par with the destruction of coral reef through bleaching caused by global warming.

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It may be that China is using the logic of the Kuznets curve: BRI projects aim to support infrastructure, to get more countries over the “peak” of economic development. However, undercurrents of exploitation under the BRI abound as accusations of debt diplomacy are being made, seeing as BRI partner nations, such as Sri Lanka and Djibouti, are racking up huge public debts to China. China’s Arctic trade route brings up a whole host of environmental concerns: the proposed Polar Silk Road makes use of receding polar ice caps to open a new trade route. China’s announcement of the ban on waste imports had a righteous air but in practice caused huge bottlenecks of trash in UK and Europe. The suddenness of the ban caused nations to resort to incineration of landfill, creating extremely toxic emissions. Head of the European Recycling Commission Emmanuel Katrakis criticized China for its focus on more “visible” signs of environmental destruction, instead of fighting the “big battles”. Are China’s environmental policies just for show? As China rises, Beijing is in great need of positive press. China’s environmental policies are clearly part of a two-pronged strategy, with increasing its domestic and international legitimacy as the key goal. Environmental degradation remains the biggest source of domestic discontent in China. In the past few years, viral documentaries such as Under the Dome (2015) and Plastic China (2016) were quickly blocked by the state censorship machine. Currently, state censorship on environmental reports are still in operation as part of the clampdown on popular protests about air quality. Local meteorological bureaus must align with central government warnings with regard to air quality, which are known to be rosy-tinted. The haste with which China has implemented environmental policies was most likely incentivized by the need to head off the discontent of the Chinese people. The ostensible contradictions in China’s environmental policies can be summed up as a “pollute first, clean up later” strategy. This attitude applies equally to its exploits both domestically and abroad through the BRI, as Beijing remains convinced that development and environmental degradation are merely the two sides of a very lucrative coin. While the passing clouds have left London and now Beijing, it looks like there will be New Delhi and Islamabad to follow.

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