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NDTV
13 hours ago
- Business
- NDTV
What's Behind China's Growing Military Aggression? A 'White Paper' Has Clues
The sighting of two Chinese aircraft carriers - Liaoning and Shandong - close to Japan's southern islands conducting operations simultaneously has caused alarm. There have also been multiple reports of the movement of Chinese coast guard vessels near Japanese islands that China claims. Fears have been expressed that China's revised guidelines that empower its Coast Guard personnel to use lethal force for enforcing its territorial claims could lead to a major conflagration. While it may be difficult to discern the motivations behind Beijing's actions, some clues are contained in the Chinese white paper on national security that was unveiled for the first time recently. China's leadership lays out a complicated global landscape of external and internal challenges in the document. Internationally, the Chinese elite gauge pressure on its security due to sustained turmoil caused by the Russia-Ukraine and India-Pakistan conflicts, and its own great-power competition with America. The ruling Communist Party's priorities have also been ensuring economic growth and maintaining domestic stability. Economic globalisation and the intricacy and intertwining of supply chains led to China's rise. What Has China Vexed US President Donald Trump's threat to roll back international trading arrangements has cast a shadow on the trajectory of China's export-led growth model and, consequently, its continuing economic prosperity. The tariff war has shrunk the market for China's exports, hurting not only corporate bottom lines but also the neatly crafted social compact in which the Chinese middle class forgoes its rights in exchange for monetary wellbeing. While the ruling elite are confident that the GDP will grow at "around 5%" this year, a noted Chinese economist, Gao Shanwen, has cast doubts on the reliability of government statistics in China and the Party's ability to shore up the economy. President Xi Jinping has spoken publicly, stating that it is the US that it seeks to contain, suppress and encircle, by reviving old alliances and striking new partnerships. There is also the challenge posed by technological advances in Artificial Intelligence, from which Beijing seeks to benefit but hopes to minimise any fallout. Additionally, there is a fear of threats posed by extremism, attempts at colour revolution and regime change, and ethnic and religious fissures that can challenge the social order. These are the variables that the white paper openly or obliquely mentions as having a bearing on China's national security. Thus, both these planks of economic prosperity and domestic order are under strain. The Churn Within The PLA Even as the economy gives no reason for cheer, there are troublesome issues with the People's Liberation Army (PLA), the Party's praetorian guard. While there has been a purge within the PLA's military industrial complex for some time, now, big names that preside over its apex oversight body, the Central Military Commission (CMC), seem to be in the crossfire. Miao Hua, a CMC member and a Xi acolyte, was suspended last year. His profile was scrubbed off the Defence Ministry's website recently. CMC Vice-Chair He Weidong has also not been seen in public since the National People's Congress in March. Former CMC Vice-Chair Xu Qiliang, who otherwise seemed hale and hearty, died of a heart attack recently. Lastly, China's Defence Minister Dong Jun skipped the high-profile Shangri-la Dialogue this year and, instead, heads of the country's military institutions filled in. Thus, the issue of graft has tarred the military top brass. Back to the sightings of Chinese aircraft carriers in Japan's seas. Tokyo perceives it as a bid by Beijing to improve its ability to operate in foreign theatres. In February, the PLA conducted live-fire naval exercises near Australia that led to commercial flights being diverted. In the aftermath of the April 22 Pahalgam terror attack, there is evidence that China is arming Pakistan and giving it cover fire on the diplomatic front against India. There may be a tendency to view this development in isolation, but an unusually large movement of Chinese naval and coast guard vessels has been seen near Taiwan, Japan's southern Japanese islands and the East and South China Seas in the last two months. Desperate Attempts There is a pattern to Beijing's renewed aggression. First, during Trump 1.0, a deteriorating China-US relationship in 2020 led to Beijing's military coercion against Japan over the Senkaku Islands. In the same year, Chinese and Indian soldiers died in clashes at Galwan, and it was followed by a tense military standoff. In 2025, too, in the wake of Trump 2.0's renewed trade war, Washington's allies and partners are the targets. Second, the subtext of the national security white paper is clear: it paints the US as a villain, while China is portrayed as a victim, striving to "achieve peace for the last 5,000 years". As Xi suffers reversals on different fronts and perceived threats to regime survival, he may seek external aggression in a bid to rally the people, Party and personnel behind him. New Delhi needs to keep a close eye on these developments as it searches for a new modus vivendi with Beijing. (Harsh V Pant is Vice President, Observer Research Foundation, New Delhi. Kalpit Mankikar is Fellow, China Studies, at ORF.)
Epoch Times
07-05-2025
- Business
- Epoch Times
China Shuts Down Its Economic Data
Commentary There is a social contract of sorts among all governments of the world to share economic data on prevailing conditions. Behind that practice is a collegial contest to see which nation has the healthiest system, which in turn serves the capital markets by helping to direct resources where they are needed. Sometimes the data is inaccurate. Sometimes there are lies. But in general, there is at least an attempt to play along with the expectation. This allows agencies and investors to make better assessments and prognostications, plus assist policy makers and central bankers in particular to make better judgments. There is a general rule in operation. The more transparent governments are with the data they collect, and the more freedom of speech that is permitted to interpret the data in different ways, the more credible it is. It is also likely that governments which share and discuss also have numbers of which they can feel pride. Rarely do nations go entirely silent on the market, as in turning off the switches and making the data rooms go dark. It is an ominous sign. This is precisely what has happened in China. Related Stories 5/7/2025 5/6/2025 Starting the last several months, and, in some cases, dating back several years, China has gone dark in reporting the following: land sales, foreign investment, unemployment numbers, business confidence, numbers of investors in financial markets, real estate valuation, retail sales, and even vital data on cremations so that health authorities have no idea what is going on. The bureaus have simply stopped reporting. With the second largest economy, and widespread doubt about the country's economic health, this is gravely concerning. Close watchers have long raised doubts about China's GDP data. We are told that the economy grew 5 percent last year, which would be extremely impressive. But such huge measures are subject to manipulation in every country but especially in one that has made the promise of extreme economic growth central to the power and permanent control by the CCP. Experts have suggested that growth rates have been exaggerated by 2 to 3 percentage points. This past December, a highly regarded Chinese economist, Gao Shanwen, was visiting Washington, D.C. colleagues at the Peterson Institute and sat on an expert panel. Thinking that perhaps he should speak his mind, he said very plainly that no one knows for sure what the growth rates in China are. He speculated that they might be about 2 percent. 'My own speculation is that in the past two to three years,' he said, 'the real GDP number on average might be around 2 percent even though the official number is close to 5 percent.' No one in the room thought anything about it. The speaker seems to have temporarily forgotten that he is not an independent actor and was in no position to offer his objective assessment. But word got out immediately in Beijing. He was immediately disciplined and silenced. He no longer holds a job in his old securities firm. His comments have been scrubbed from any sites accessible within China. He has lost his license to speak about economic affairs. Meanwhile, the Securities Association of China has instructed all people who speak about China's economic health only to say nice things. We can gather from the above that the data that was once routinely reported is not saying nice things. It's one thing to silence the economists but to silence the underlying data only ends in raising alarm bells. And those alarms have been rung, and now observers are considering the worst. There might be a hidden real estate crisis, and a major problem with unemployment added to it. Investment might be collapsing and government finances might be in major trouble. For decades, China has developed a stable system for economic growth that relied on five main pillars: • Lower-cost manufacturing to compete and ultimately displace manufacturing in the West; • U.S. consumers hungry to get ahead of their own falling wages and salaries with cheaper consumer products and intermediate goods; • Central bank credits for business development built on large holdings of U.S. denominated debt; • A domestic currency trading far below the trade-weighted average of the U.S. dollar, the world reserve currency, thus favoring exports over imports; • State-directed and funded infrastructure development that calibrated investment based on national goals. It was never the free market that pundits imagined that it would become in the 1990s and beyond. But it was also helped by a loose regulatory environment that minimized the litigation overhang that vexes Western economies, and its agency impositions were tolerant of enterprise insofar as it never threatened political priorities. Crucially, China was able to benefit from the presumption that the global system of trade would never raise foundational questions about low tariffs and cross-border investment. That last presumption has dramatically changed. The first Trump administration began the process of reevaluation. This was in 2018 and the result was a documented decline in U.S. imports from China. This was reversed two years later with the pandemic onset that called upon China to provide vast goods back into the United States. Mass numbers of Americans found themselves mandated to wear masks, for example, most of which were imports from China. Five years later, the push to decouple the United States from dependence on China's manufacturing sector is back on. The second Trump administration has wholesale reversed 80 years of U.S. precedent in trade policy with a turn toward tariffs. The hope is that these will help settle accounts, boost U.S. manufacturing, and provide a revenue stream to reduce reliance on high income taxation. Whether and to what extent this dramatic shift has this effect domestically in the United States, it has likely had a major impact on China's economic prospects, simply because it challenges a long-running assumption that the U.S. would forever serve as China's consumer marketplace. We should pause to consider the great irony of this whole situation. For centuries, businessmen have fantasized about the sheer size of China as a consumer, and imagined ways to invent products and services to sell. 'A pair of shoes for every Chinese foot;' 'China's market will make us rich;' 'A market of 400 million customers'—these slogans were bandied about for a century. But when it came right down to it, and herein we find the essence of the unpredictability of economic affairs, it was not China as consumer but China as manufacturer that dominated the landscape for decades following its opening. Only now do we see full consciousness dawn in the United States concerning the implications for U.S. manufacturing. What is to be done? A better path than protectionism is mass deregulation, a dollar more powerful at home and more competitive abroad, and lower costs of doing business through a renewal of the American entrepreneurial spirit. This will need to come one way or another. Trade barriers alone cannot hold back the tide. Meanwhile, China suddenly faces its own grave economic challenges, which could grow so substantially as to threaten even the political stability of the country. Right now, outside observers have been largely blinded as to how serious the situation has become. We just don't have the data. Views expressed in this article are opinions of the author and do not necessarily reflect the views of The Epoch Times.
