Garvan Walshe: Four ways in which democracies can fight back against China’s state gangsterism

23 Dec

Garvan Walshe is a former national and international security policy adviser to the Conservative Party.

Peng Shuai, a Chinese Tennis player, accused a former Chinese vice premier of sexual assault on the Chinese social network, Weibo.

The post then disappeared, and so did she. Six weeks later, she gave an interview to a pro-Beijing Chinese language newspaper denying she had ever made the allegation. Far from clearing things up, this stage-managed recantation reeks of state gangsterism.

The behaviour is part of a pattern of violence and intimidation that has intensified since Xi consolidated power in China. It goes beyond traditional targets of Chinese policy like Hong Kong and Taiwan, and takes in anyone that dares to cross the regime’s leadership.

Sometimes it is absurd (demanding that all Amazon reviews of Xi Jinping’s new book shown in China receive five stars), but more more often it is sinister – as demonstrated by the sanctions applied to Lithuania, the attempts to intimidate German companies that use Lithuanian suppliers, and the politically motivated prosecutions of Canadian businessmen Michael Spavor and Michael Kovrig, who were only released after legitimate charges were dropped against a Huawei executive.

China has turned globalisation into a weapon, and Western democracies need to develop a systematic defence. During the 1990s and 2000s, a combination of wishful thinking and greed allowed China to enrich itself through a globalised economy while maintaining an ideology hostile to the rules on which the international order was based.

Democratic countries have started to understand and correct this error in individual cases: Australia has sought stronger security guarantees from the United States through AUKUS. The UK has removed Chinese involvement in British nuclear electricity infrastructure, and the new Czech government, for instance, is likely to adopt a more sceptical approach to Huawei’s provision of 5G infrastructure.

While these changes are welcome, it is time to consider a more systematic approach. A first mistake of the 1990s was to think that economic growth would lead to democratic change. Though there may have been merit in the theory that wealthier middle classes are more likely to demand accountable government, it was unwise to base policy on a “law” among whose exceptions may be counted Russia and Turkey, as well as China.

A second, less well-understood error was to think it possible to depoliticise business in authoritarian states. Instead, the opposite happens: businesses, which need to make money after all, are being held hostage to the regimes’ agendas, whether these matters are as trivial as reviews of the Xi Jinping’s book, or as geopolitically pointed as Lithuania’s support for Taiwan.

Western foreign investment is subject to extortion, while authoriarian investment in the West is used to finance strategic corruption. Western libel laws are then used to attempt to silence its exposure (as Catherine Belton, who has successfully defended her Putin’s People from a fusillade of lawsuits can attest).

The lesson is that the globalisation of finance is only reliable when mechanisms exist to enforce the depoliticisation of business, whether through domestic courts that enforce international agreements, or Investor State Dispute resolution agreements when domestic courts cannot be trusted.

This applies equally to sport, where athletes should not be compelled to follow regime agendas either, and should be free to seek justice for crimes committed against them by the regimes.

That we instead have had to rely on the courage of HarperCollins, Belton’s publisher, or the Women’s Tennis association, which has stood by Peng Shuai, is not good enough. Democracies, acting together, need to start thinking about how to protect their sports organisations and busiesspeople from capture and extortion by powerful dictatorships.

There are four things democracies should do.

First, ensure protection from arbitrary retaliation, such as that China is trying to impose on Lithuania, by establishing automatic means of retaliation. To work well, these need to be done by democracies together. The EU is proposing an “anti-coercion” instrument for this purpose. The UK, US, and other democratic states should follow suit, and include countries like South Korea, which are too small to resist Chinese pressure on their own.

Second, sporting and research organisations could be supported, or compelled, make competitions and research cooperation conditional on ensuring the political independence and academic freedom of participants. Democratic countries dominate these areas to ensure such conditions are upheld. Even FIFA, happy to sell out to non-footballing Qatar would have to pay attention — who would watch a world cup in which democratic countries didn’t participate?

Third, in a sort of “democratic preference,” future economic integration should be focused on democratic countries, and could include snap-back clauses to remove priveleges if democracy decays.

Finally, democracies should act collectively against strategic corruption, leaving kleptocrats without a safe place to stash their money.

Peng Shuai’s treatment by the Chinese regime should reinforce the warning delivered to Michael Spavor and Michael Korvig. Neither celebrity or foreign citizenship can protect you from becoming an instrument of the regime’s intimidation. The naive globalisation of the 1990s has become a liability. Democracies need to beef up their defences against the Chinese dictatorship.