In the midst of already souring relations between US and China, the current global coronavirus pandemic may be aggravating the animosity that both superpowers have against each other.
How will a mixture of US-China bilateral tensions and the ramifications from the global pandemic impact the security and prosperity of Asia and beyond? This was the focus of the second virtual episode of the Lee Kuan Yew School of Public Policy's "Asia Thinker Series" on the global pandemic.
Moderated by Professor Bert Hofman, Director (East Asian Institute) and Professor in Practice, Lee Kuan Yew School of Public Policy, National University of Singapore, the session saw a distinguished panel of experts examining the role politics play in the managing of a global pandemic, as well as the complications this has for Asia.
COVID-19: A catalyst for increased tensions?
Professor Kishore Mahbubani, Distinguished Fellow at the Asia Research Institute, National University of Singapore started off the discussion by acknowledging it would have been "very good for the world" if both the US and China had decided to take a strategic pause to focus on fighting COVID-19 together.
Against a common enemy, working together to overcome this health crisis should be priority. "Sadly," he continued, "the opposite happened and as a result, what COVID-19 has done is to actually aggravate the US-China geopolitical contest when it should have actually calmed it down."
Despite the hefty price that both nations — as well as the rest of the world — will pay in terms of lives lost in the aftermath of the pandemic, it's becoming increasingly apparent that neither side is willing to give in.
The roots of a major geopolitical mistake
As put forth in his book Has China Won?, Professor Mahbubani also believes that the United States has made a fundamental strategic mistake in launching this major geopolitical contest against China, without first working on a comprehensive global strategy. "It is in America's national interest to work out a comprehensive strategy, and to build on the advice that Sun Tzu very wisely gave: Know thyself, know thy enemy. A thousand battles, a thousand victories."
The first big mistake is that the United States does not know itself, said Professor Mahbubani. "Now, we all know about the great strengths that the United States has. But at the same time, America has developed some structural problems, as Professor Danny Quah has documented. It's the only major developed society where the average income of the bottom 50% has gone down over a 30-year period. America has become a plutocracy and a society that is incapable of making U-turns and adjusting to new realities."
"For example, if they're serious about China being the number one adversary, what they should do is stop fighting in the Middle East, but they can't. That's an example of the rigidities that America has accumulated," he elaborated.
At the same time, the second part of Sun Tzu's strategy is "know thy enemy" — most Americans know very well all the structural weaknesses of China. And like any other society, China has many weaknesses.
But, Professor Mahbubani stressed, what most Americans are not aware of are some of the fundamental structural strengths that China has developed. "One example I give is that the Chinese communist party, and I know this is a very controversial thing to say, has effectively become a meritocracy where the best and brightest join it."
"The Americans must recognise that the return of China is the return of a strong civilisation, which was the number one economy in the world from the year 1 to the year 1820. So, the return of China is conceptually natural — it cannot be stopped."
Possible US-China economic decoupling
Part of the strategic competition between the US and China involves the possible decoupling of these two major economies. While this may have been coming for a while now, COVID-19 could be accelerating the process.
Professor Alicia Garcia-Herrero, Chief Economist for Asia Pacific, Natixis, thinks that this might even come from both sides as it becomes more and more obvious to China that the decoupling is unavoidable. While she emphasises that there can be no such thing as a complete decoupling, there will be increasing difficulties in terms of interdependence.
"We've moved from the very obvious trade war, which was basically dealing with the surface, meaning import tariffs, to a more complex impact of that trade war and COVID-19 on the global value chain," she said. "The centricity that China has played for a long time in that global value chain is being basically diminished, simply because it's becoming crystal clear that the dependence on them in the value chain can also bring some problems if push comes to shove."
Beyond global value chains, she continued, what the world is seeing is also the deglobalisation of the movement of people. While that is forced partially by COVID-19, it is also a product of structural changes that go beyond China.
"And finally, a very tricky and dangerous type of deglobalisation we may be seeing that's accelerated by COVID-19... is financial disintegration. In particular, the decoupling of China's companies listed in the US and US investors who are tapping the Chinese market — we're starting to see signs that this might be increasingly dangerous from both sides."
A triple whammy
According to Professor Khong Yuen Foong, Vice Dean (Research) and Li Ka Shing Professor in Political Science, Lee Kuan Yew School of Public Policy, while there is never a good time for any pandemic, being inflicted by it now is like being whacked by what he calls "a triple whammy," from a geopolitical point of view.
"The pandemic couldn't have come at a worse time for US-China relations. The first whammy is the year-long trade war that has strained US-China relations, and the pandemic has made matters worse. That is one reason why the US and China have found it so difficult to cooperate. Second, the trade war itself was a symptom of a larger dynamic, namely the shifting balance of power from the West to the East.'
He continued, "In official documents, the US identified China as a strategic rival. To the US, this is a rival that espouses values inimical to the core values of the US and has to be confronted. Third, we are six months away from the US presidential election."
These three contextual factors lead him to believe that as the curve flattens, there will be enormous pressures in the US, and perhaps Europe, to assign blame and to seek accountability.
"The blame game will take on an extremely impassioned character because of the huge casualties and the economic havoc. Within the span of four months, US coronavirus deaths have already surpassed the fatalities of the Vietnam War. So I expect a lot of anger in the months ahead that would be directed at the source of the pandemic."
As we are beginning to see, Trump and the Republicans will turn to deflecting blame, focusing on allegations of China's lack of transparency. This blame game is only expected to intensify as the elections approach.
"The main danger of this, however, is not that it will lead to a direct US military confrontation. Rather, it will make relations so tense and trust so low that it could spark a larger conflict.
What does it mean for SEA?
Ultimately, Southeast Asia will be caught in the middle.
"The strain in US-China relations will lead to the unwelcome dilemma of being asked, once again, to choose between the US and China on the issue of whether to assign blame. And if so, who's to blame? As many know, in recent years, most of the ASEAN countries have repeatedly said they do not want to be put in this position of having to choose between the US and China," said Professor Khong.
However, sitting on the fence has become increasingly difficult. Both the US and China will bring pressure on Southeast Asia to side with them in the blame game. Despite this, he believes that the majority will not support a probe or an investigation of the kind wanted by the US and its allies. In fact, Professor Khong thinks most in ASEAN will give China the benefit of the doubt.
"Most importantly, for most in ASEAN and beyond, the issue is not whether China covered things up but rather, when the pandemic took hold, which societies did best at containing the spread and saving lives?"
He continued, "The other performance test will be who would recover faster economically? While the jury is still out on this one, I would not underestimate America's economic resilience and its technological ingenuity, but if China were to do better than the US on the economic front, this narrative about being the wave of the future will fall on receptive ears in Southeast Asia."
Watch the full recording of COVID-19: How will increased tension on US-China relations implicate the region?