China has long been in a trade war to be the world’s number one GDP with the USA for a very long time now. Both China and the USA are superpowers that are globally renowned. But has this trade war resulted in something more sinister? The obsession of the Chinese to overpower the USA and be the number one country. Both economically and military-wise has given rise to a number of disputes between China and other countries in the world.
China has been very aggressive with its trade reforms and military intentions over the past decade and a half. Its territorial claims and military expansion policies make it clear that China wants to be recognized as a superpower. But in doing so they have overpowered and overlooked certain aspects of legal and ethical activities. Which has resulted in a sense of fear against China. Not only in the South Asia region but also in the west (Hynes, 2018). But the countries around the world cannot just ignore the motives of the Chinese and have begun to take notice.
China is the number one source of imported products and the USA is its biggest customer. The world trade is heavily dominated by these two countries and thus, their economies are interrelated. To read more about the trade war between China and the USA click here.
Debt-Trap and Chinese Diplomacy
China has reclaimed at least 7 spots in the South China Sea. Which is incredibly rich in natural resources like oil, natural gas, and fisheries (Mehta, 2020). Also, 30% of the world trade is routed from here to around 2.2 billion people in South East Asia. China has also offered huge amounts of loans to not so well economic nations like Pakistan, Sri Lanka, and Bangladesh. Knowing perfectly well that they won’t be able to pay China back. So in return, the Chinese occupy a piece of land, build airstrips, and military bases there (Mehta, 2020).
This tactic by China has caught the eye of neighboring countries like India. Due to which recent tension on the LOC was witnessed in July – September 2020. The USA or other major countries in the world aren’t too excited by this military presence of China. It is hard to believe but apart from the country itself. China has 7 military bases surrounding India in 7 different directions, giving them a huge advantage in a warlike situation. (Mehta, 2020). This debt-trap by China diplomacy and illegal occupancy of islands in the South China Sea China has raised various alarms. And created a lot of tension between China and other countries around the world.
Covid 19, International Trade and China
Although all the fore-mentioned factors point towards China as being a bully in the global trade world. The year 2020 has brought to the world the worst economic and health catastrophe since the 1920 pandemic. But did Covid 19 actually affect China as much as it affected all other countries? In 2020, the race to become the global economic superpower between the USA and China went head to head. All China needed was a boost for its economy. Whilst the pandemic brought most of the countries’ economies to a standstill China doesn’t seem to be suffering as much. Even though the first outbreak of the virus was reported in China, it was contained and dealt with fairly quickly. Its effects were minimal as compared to other countries.
To put things into perspective, when the whole world wasn’t recording any cases. China was recording a minimal number of cases. Not to forget, these cases were at the peak of the Chinese outbreak. However, within 2 months the cases suddenly stopped coming out of China. And the rest of the world had more than 200,000 cases a day (world meters, 2020). The industries were shut, the whole world was on lockdown. But there was one country that was back on track before anyone was even hit by the pandemic properly.
Why China may be Accountable?
Now, if you already are the world’s cheapest source of manufactured goods. And the entire world is in lockdown. But you are running a full-scale production. It is nothing but evident that the whole world started to order things from China. The demand was skyrocketing as there was no other country that was manufacturing anything. From medical equipment to clothes, shoes, and medicines. Everything was in huge demand and there was no supply from anywhere around the world but only from China. (Dhar, 2020). This gave a huge boost to the Chinese economy, even after a slight slip in the first quarter of 2020.
A lot of world leaders including Donald Trump, Putin, and others have publicly called out China. And have shown their level of angst and anger against the nation. The place of China in terms of good relations with countries has diminished significantly. And maybe a more of a worrying factor to China than anything else. Because who will they sell their goods to if no one wants to work with them? The entire world has blamed China for the outbreak. Sighting the simple reason that the Chinese were experimenting with something that they shouldn’t have. And they failed miserably to contain it. The world’s economy is the worst hit in the last 100 years. The following picture compares the world economy of various countries pre and amidst Covid.
All these factors have made the world question that was the virus man-made? Was it deliberately leaked into the world to cause panic? Do the Chinese already know how to contain the virus, do they already have a vaccine for it? All these questions and previous actions by China. And the world’s lack of trust in the Chinese Communist party has resulted in soaring of relations with other countries. Big technology and manufacturing companies have decided to move out of China. And into other countries around the world as a safeguard and a security measure for the future.
Military tensions between China and India amidst the pandemic has resulted in the Indian government launching digital strikes against China. By banning top tier Chinese apps like Tiktok and Pubg (Singh, 2020). All in all, COVID-19 has proved to be a double-edged sword for the Chinese. But it did provide a huge boost to its economy when the whole world was under a lockdown.
China versus the USA
This trade war is one for the ages and it’s no longer near to its end. The American President has openly blamed China for the outbreak of the virus, calling it ‘Chinese-virus’. And has also publicly shown his unhappiness about the whole situation with China. He has also threatened to limit trade with China and also impose trade restrictions on the country. The American government wanted to investigate the Pandemic on Chinese grounds. But were not allowed by the Chinese Communist party into the country, raising more eyebrows about the whole situation. The current scenario is tense both politically and economically (NDTV, 2020).
China versus India
The 2 most populous countries in the world were seen having a tense few months on the border. China being China has been repeatedly trying to infiltrate and occupy land inside the Line of Control. And has been repeatedly shut down by Indian troops. After the pact of 1962, when the countries faced each other off in the war. 2020 was the first time bullets were fired on the border. India has accused China of illegally occupying land in the Indian region. And constructing military bases on it which have resulted in military tensions between the 2 giant nations (BBC, 2020). Even though the dispute concerns the border, India has fought back launching digital strikes. A large number of Chinese apps were blocked from the Indian market. India has received global support from all over the world for its decisions.
China and the WTO
China has been a part of the WTO since 2001, it is amongst one of its biggest members. However, the economic policies of China have become a source of tension. Amongst member nations like the US and EU who have continuously accused China of providing subsidies. Which has lead to overcapacity and subsequent dumping of goods. The WTO has not taken any certain and solid steps to resolve these issues. Majorly because China is an integral part of the organization and a huge contributor to the world’s economy. But it might feel like the WTO has developed a bias towards the Chinese (Blanchard, 2013).
China and the United Nations
The United Nations has been recently been in question over its bias towards China as well. Ever since the pandemic, there has not been any investigation or questions raised by the UN which is very questionable itself. One of the reasons for no questioning might be that China is the head of the UN security council. And nothing against a leader of such a big council can be said out publicly. Due to the number of people who put trust in an organization like the UN.
WHO has been under questioning by leaders from across the world. Including the US President, Donald Trump, questioning WHO’s measured to contain the virus. Also blaming them for aiding China from all the blame. And stopping the millions of dollars’ worth of funding the US gave to the WHO (Feltman, 2020). The whole matter is really skeptical. But there has been no official statement by the WHO or the UN over this matter at all. Chinese influence in the UN has been sighted as a problem by many member nations of the UN (Kreuder, 2019).
The world has been in its worst economic phase ever since the 1920 pandemic. China is blamed by a number of nations and world leaders. And has also been accused of trapping third world nations into its debt trap. But why are the WTO and the UN silent about all of this? Are they favoring China or have the Chinese influenced the WTO and the UN so much? If this keeps going on, maybe we will see the WTO and the UN falling out. As the member nations might lose faith in these organizations and might start looking for alternatives. The Chinese don’t have good relations with any major countries of the world today, the US, India, Russia, EU, Australia. All are blaming China for today’s economy and pandemic.
How will this turn up for China? Will companies still invest in China? Will countries still trust China and pursue trade deals with them? Or will the tension increase so much that we will have a war on our hands? All of these questions are intriguing and really make you question a few things. How we all are related to international trade and trade law in some manner! How the decisions made by the Chinese or Americans affect us all over the world! Why is there no enforcement of trade-laws by the WTO? Is the WHO covering Chinese tracks (Kreuder, 2019)? Why is China increasing its military bases in the South China Sea? Do they want to conquer the trade route, to help them rule world trade?
All these questions are simple, yet very complicated. As we will never know the whole truth due to the communist nature of the CCP. And no net neutrality in China, we only know things about China, that they want us to know (Yang, 2011).