Margaret Poda, MBA/IPD ’19

China Dream Practicum

Immediately following the end of Spring semester, I dashed off to China to participate in the China Dream Practicum. This course aimed to inform students of the legacy, reality, and aspiration of the China Dream as seen by stakeholders inside and outside China. The focus was for students such as myself to further understand and appreciate the growing significance of China in the regional and global economic, political, social and ecological affairs.

While the focus of the trip was the China Dream, each student participant had their own research question. Mine is as follows: what are the opportunities presented to China by Russia’s pivot East, considering the proximity and relative underdevelopment of the Russian Far East? While I have all Summer and Fall semester to consider the true answer to this question, I can provide at least a brief and informal look into the China Dream from this perspective.

Of the approximately 20 students from MIIS and Middlebury, only a few of us did not speak Chinese and even fewer had never before visited China. As I do not speak Mandarin and have never been to China, I was honored to be travelling with such a knowledgeable and helpful group. Perhaps you can tell by my research question above that my focus of study is not simply “China” – I have had much more experience travelling and living in Russia and Eastern Europe. So, needless to say, I came to China with a very different perspective than perhaps others in the group. This practicum opened a world to me that I had not seen before. A world which will continue to inform my studies at MIIS and beyond.

Now, about that China Dream. The Chinese Dream is President Xi Jinping’s integrative and transformative vision for China: an overarching unifying principle for the Chinese people and a “great rejuvenation of the Chinese nation” that includes five high-level categories: national, personal, historical, global, and antithetical. For the purpose of understanding the future relationship between China and Russia, three of these categories are most important: national, historical and global.

The national category encapsulates the vision of China becoming a moderately well-off society by 2020. This refers to a society where all citizens, rural and urban, enjoy a decent standard of living, including doubling the 2020 per capita GDP (approaching $10,000) and completing urbanization of more than 1 billion people, roughly 75% of China’s population over the next decade. This category also includes the modernization goal of China becoming a fully developed nation by 2050. This means China reestablishing its position as a world leader in science and tech as well as in economics and business, and the resurgence of Chinese civilization, culture, and defensive strength.

Second, consider the China Dream as a historical category. According to Robert Kuhn, China has had a long desire for a unified, sovereign, peaceful and prosperous country and progressive development of China’s political theory. After suffering foreign invasion and subjugation for generations, and enduring domestic oppression, the Chinese people yearn for stability and transformation to a new China that is independent form foreign influence.

Finally, the China Dream is a global goal. The world benefits from the Chinese Dream because as living standards of the Chinese people rise, more goods and services are used, including imports. Because China’s population is huge, jobs are created, and prosperity is increased globally. The “rise of China” is one of the most discussed and debated developments of recent times. In less than three decades. China has transformed itself from an agriculture-based society to one of the most developed societies in the world – to some this is a threat.

“The China Dream Team in downtown Shanghai after meeting with Chinese investors and a tour of the Shanghai Stock Exchange.”

The world worries because some perceive the Chinese Dream to have expansionist, or even imperialist, undertones. Even when China’s leaders tout that “no matter how strong China becomes, China will never seek hegemony,” some remain suspicious and think that a more powerful China will be aggressive. China can mitigate concerns by explaining that the nation is determined to elevate domestic standards of living and international discord undermines this core goal. The Chinese Dream is one that must marry people’s expectations, domestic and international, of prosperity with a sustainable, stable, and peaceful China.

So how does my Russia focus play into this “Dream”? China is a rising power and Russia is not. Moscow may not be willing to accept a junior partnership with China, nor is China likely to treat Russia with the respect Moscow would assume it deserves.

However, Sino-Russian ties are growing. Trade between the two countries is about $100 billion a year. As part of China’s Silk Road initiative, China may invest in Russian infrastructure that could improve transport of Chinese goods across Russia to Europe and the Middle East. Moscow and Beijing have also agreed to pursue two huge projects that would bring Siberian gas to China, which would enable Beijing to supplant Europe as Russia’s largest natural-gas buyer.

But there are uncertainties: these projects will be costly, China is driving a hard bargain as Russia loses gas-market share in Europe and China sees Russia as a risky investment. Moscow no longer expects that Chinese financing will replace Western capital markets, which Russia has less access to since sanctions were imposed because of Russian-supported armed intervention in Ukraine.

Beijing and Moscow are also linked by a commitment to authoritarian political systems, backed by increasingly nationalist rhetoric. Putin and Xi are unhappy with Washington’s championing of more open political systems. This was reflected in Beijing’s angry reaction to student demonstrations in Hong Kong, and in Moscow’s claim that outside powers have manipulated Ukrainian politics to foster hostility toward Russia.

But Russia’s diminished economic prospects weaken its ability to deal with China on an equal plane. China’s economy is more than four times larger than Russia’s and the gap continues to widen. The collapse of energy prices, Western sanctions and statist control severely burden Russia’s economy.

If Russia cannot find new sources of economic growth, it will lose its claim as a great power. Through pragmatism, especially in energy and trade, China and Russia have options to forge an essentially cooperative relationship. At the same time, limits to their partnership could grow over time given the two nations’ differing trajectories and historical grievances.  Moscow and Beijing have key decisions to make. Anti-U.S. posturing does not help either nation achieve its most important national goals.

Having considered what is detailed above, there is little information that covers the effect of Russia’s huge investment in the Russian Far East, and how this could create a lasting impact on the development of the Russia-China relationship. Thus, it is important to ask the question: what does a strong relationship between Russia and China look like? There has been much speculation, but in light of recent events in the US, the relationship between these two countries is beginning to shift and develop, especially in terms of economy. Russia is dealing with harsher and harsher sanctions from the West and they have turned to China to become a huge supplier. China is dealing with trade restrictions from the US, and this could be transformative in the future of their relationship.

In the coming months, I will continue to sort through my notes from this unbelievable trip. Even as I write this short download, I am pulled in so many different directions by the various roundtable discussions and one-on-one interviews with students that I had the opportunity to participate in. An opportunity like this is a rare thing, and I am glad that I took this opportunity.

 

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