Review of Developments in China in 2019
Dr Teshu Singh, Research Fellow, VIF

In 2012, Xi Jinping along with other members of the standing committee of the CPC Central Committee Political Bureau, Li Keqiang, Zhang Dejiang, Yu Zhengsheng, Liu Yushan, Wang Qishan and Zhang Gaoli visited an exhibition titled ‘The Road to Renewal’ at the National Museum in Beijing. The ideas advocated by Xi Jinping were subsequently referred to as the ‘Chinese Dream’. A review of the country’s overall social, political, cultural and diplomatic development allows assessing the development of the country to facilitate a better understanding of Xi Jinping’s Dream and how far has China reached in their agenda of attaining that goal. Under Xi Jinping’s authoritarian rule, the country has been socially and economically stable but the unabated protests in Hong Kong and the dispute with the US are indicators there is trouble chasing the Dream.

Political

In January 2019, at the Central Party School, Xi said: “Globally, sources of turmoil and points of risks are multiplying. On the domestic front, “the party is at risk from indolence, incompetence and of becoming divorced from the public.”1 According to Chen Yixin, Secretary-General of the Central Political and Legal Committee, Xi Jinping’s speech was a wake-up call to strengthen the awareness of the sorrow, a sledgehammer to strengthen the bottom-line thinking, a charge command to carry forward the spirit of struggle, and to urge the party to stay calm. The speech emphasised three “new’s”- to study new trends, to study new strategies and to study new tactics. 2

70th anniversary of the People’s Republic of China

On 1 October 2019, China celebrated its 70th anniversary of the foundation of the People’s Republic of China. The celebration was marked by the military parade. Earlier the military parade used to be held every 10 years but now it is taking place every five years. Until now three such parades with a gap of five years have taken place. On this occasion, in his speech, Xi Jinping emphasised on the Chinese achievements in the past 70 years and reiterated the principle of ‘one country two systems’ with special emphasis on Hong Kong and Taiwan. 3 His speech was targeted on the domestic audience and had two messages. First indicating that China has arrived as a ‘great power’ and second was to showcase its military strength through the display of indigenously produced weapons.

4th Plenary Session of the 19th Central Committee

The 4th Plenary session of the 19th Central Committee was held from 27-31October 2019. The CPC’s Central Committee usually convenes seven plenary sessions in five years term of the Party Congress. It is an opportunity for the leaders to announce the blueprint of China’s domestic and foreign policy in the coming years. The plenary session of 2019 was held after a delay of 20 months. Reportedly, the delay was due to the internal differences within the party, US-China trade friction and the Hong Kong crisis. Seemingly, Xi Jinping’s decision to revoke his term limit along with the power centralisation and the anti-corruption campaign might have resulted in the intra-party dissent.4 The communique of the plenum reviewed and adopted the CPC Central Committee’s decision to improvise the system of socialism with Chinese characteristics and advance the modernisation of China’s system and capacity for governance. Additionally, it also discussed the risk China is facing.5

10th Defence White Paper

The 10th Defence White Paper was released on 24 July 2019. It elucidates China’s basic principles of national defence, military strategy, and modernisation that have not changed substantially since the last White paper was released in 2016. The paper has six chapters and highlights internal security issues. It focuses on the fact that China is making efforts to bring Asia together in peaceful cooperation through organisations like Shanghai Cooperation Organisation (SCO), the China-ASEAN Defence Minister Informal Meeting, and the ASEAN Defence Minister’s Meeting Plus (ADMM) Plus. Further, it points out the Chinese army will continue to grow itself to the extent it can challenge the US. Overall, the paper appears to be a direct response to the US report on Chinese Military issued by the Office of the Secretary of Defense and by the Defense Intelligence Agency.6

Among other developments, Chang'e-4 probe made a historic landing on the moon's far side; the Long March-5 Y3 carrier rocket was launched, and the polar icebreaker Xuelong 2 set sail on its initial voyage to the Antarctic.

Society

In July 2018, the New York Times, published an article titled “As China’s Woes Mount, Xi Jinping Faces Rare Rebuke at Home”7 that drew attention to an article published by the Unirule Institute of Economics by Prof Xu Zhangrun. Subsequently, on 26 August 2019, the Unirule Institute of Economics, an independent think tank was closed down. It was shut down on the pretext that it was operating without authorisation.8 Subsequently, Prof Xu Zhangrun was suspended from the Tsinghua University, for publishing this opinion piece at the Unirule Institute of Economic that questioned the personality cult of Xi Jinping.9

New Policies
Changes in the Hukou System

In 2019, the National Development Reform Commission (NDRC) introduced some changes in the Hukou system of China. The reform states that cities that have population of 3 million would “lift all restrictions on domestic migrants obtaining residency permit” while cities with a population between 3 and 5 million would “comprehensively lift or relax restrictions” and cities with more than 5 million people would “lower the threshold and boost the number of people gaining residence permits”. This policy is a shift from an earlier policy that only encouraged migrants to settle in small cities while restricting them from coming to the bigger cities.10

Education Reform

In consonance with the political line of the 19th Party congress, a political campaign was launched in 2019. It called for, “staying true to our founding mission”. The main target of the campaign is to conduct in-depth studies on Xi Jinping Thought on ‘Socialism with Chinese Characteristics for a New Era’ and implement them.11

Human Rights in Xinjiang

A group of 22 group countries wrote a letter to the United Nation’s High Commissioner for Human Rights, on the Human rights violation in Xinjiang. The letter instructed China to end its "mass arbitrary detentions and related violations" and asked them to allow the United Nation experts to access the region. It is the first major collective international action against Chinese activities in the Xinjiang region. It is estimated that around 2 million people are detained in the detention camps that China calls as re-education camps. 12 China has often tried to paint Xinjiang Province as a hub of anti-terrorist activities. Further, on 21 July 2019, China released a White paper on Xinjiang.13

Chinese Economy
Foreign Investment Law

Amid the US-China trade conflict, China was concerned about the investment flow. On 15 March 2019, China approved a new Foreign Investment Law (FIL) to improve the overall business environment for foreign investors and guarantee that foreign enterprise participates in the market. The law seeks to restructure the unequal laws and regulations governing foreign investment and added clauses relating to the banning of forced technological transfers. The law will come into effect from 1 January 2020 and will be a new guiding document governing foreign investment in China.14

Six New Free Trade Zones

Chinese government included six new free trade zones (FTZ). They are Jiangsu, Shandong, Hebei, Heilongjiang, Guangxi, and Yunnan provinces. With the addition of these six new FTZ, the total number will be 18.15 All six FTZs are located in the different border regions and are entrusted with the role of improving ties with the neighbouring countries and facilitate the Belt and Road Initiative.16sup>

World Investment Report 2019

An article in People’s Daily mentioned that the World Investment Report 2019 by the United Nations indicated that in the first half of 2019, China attracted USD 73 billion in foreign investment, maintaining its position as the second-largest destination of foreign investment and the largest developing-economy recipient of foreign investment. During the second China International Import Expo, deals worth USD 71.13 billion were signed. The two “USD 70 billion” represents the global recognition of the number of dividends delivered by the Chinese market and level of opening-up of China, as well as the world’s continued confidence in China’s economy, according to the commentary.17

China’s Diplomatic Engagement

The new contours of the Chinese Foreign Policy were unveiled during the 19th National Congress of the Communist Party of China that was held on 18-24 October 2017. In his speech, Xi Jinping stated: “The Chinese nation, which since modern times began had endured so much for so long, has achieved a tremendous transformation: it has stood up, grown rich, and is becoming strong; it has come to embrace the brilliant prospects of rejuvenation.” 18
In 2019, Xi Jinping attended several international events in China and abroad. He participated in the Global Governance forum in 2019 in Paris, France, the Second Belt and Road International Forum in Beijing, 26 April 2019, the International Horticulture Exhibition on 28 April 2019, Beijing, the Conference on Dialogue of Asian Civilisations, 15 May 2019, 19th Meeting of the Councils of Heads of State of the SCO, Bishkek Kyrgyzstan, 14 June 2019, the fifth summit of CICA at Dushanbe, Tajikistan, 15 June 2019; the G20 summit at Osaka, 28 June 2019, the Second China International Import Expo,5 November 2019 in Shanghai and the BRICS Summit in Brasilia, Brazil, 14 November 2019. 19

Second Belt and Road Forum for International Cooperation (BRF)

The Second Belt and Road Forum for International Cooperation (BRF), titled as ‘Working together to deliver a Brighter Future for Belt and Road Cooperation”, was held in Beijing, on 25-27th April 2019 and attracted wide international attention. It was attended by 36 heads of State and government, along with 5,000 other representatives from different countries and 90 members of international organisations. Unlike the triumphalism that marked the first forum in 2017, this time there was a clear element of defensiveness in China’s position. Xi Jinping’s speech at the forum emphasised on how to handle the criticism surrounding the BRI. He also came up with new promises to emphasise ‘quality development’, ‘innovation’, ‘science’, ‘green’, ‘multi-culturalism’ and ‘sustainability’. 20

US-China Trade Dispute

In 2017, at the informal summit in Mar –a-Lago, Xi Jinping and Donald Trump agreed for the establishment of a “100-day plan on trade” as well as a new high-level forum called the “US-China Comprehensive Economic Dialogue”. Following this, in April 2017, the US and China launched a 100-day action plan to improve trade relations. Subsequently, in March 2018, Donald Trump signed a memorandum to file a WTO case against China. Until 24 September 2018, the US and China had implemented a third round of tariffs and by 2 December 2018, the US and China agreed to a temporary truce for 90 days. Over a period of time, a trade dispute that started in 2018 got transformed into a retaliatory cycle of structural rivalry including technology, national security and geopolitics. By the end of 2019, the protracted trade war had stretched over 550 days. On 13 December 2019, the Chinese side announced that the two countries had reached agreement on the text of the phase one economic and trade deal based on equality and mutual respect.21 The first phase of the deal is scheduled to take place on 15 January 2020.

Hong Kong Protests

Yet another challenge for Xi Jinping and China are the protests in Hong Kong. The protestors are working on the weekdays and staging protests on the weekends. There are no signs that the protests against the local government and China are cooling off or ending any time soon. The protest movement is leaderless and faceless. The protesters’ slogan “Be Water” epitomizes the movement’s tactics. The movement has been termed as having “self-learning artificial intelligence”, as it depends on quiet learning. The protests have divided the city into two - the protestors and the authorities. The leaderless protest was possible because of the use of social media. Almost 25 per cent of the population joined the protests through the instant messaging app Telegram, Instagram site and online forums like LIHKG, and by learning lessons from the ‘Umbrella’ movements. Every time a protest is over, online messengers such as the Reddit-like LIHKG forum are filled with the posts. Taking lessons from Hong Kong, the Chinese citizens are also raising the issue - If Hong Kongers can get what they want by protesting, why can’t we? The future of Hong Kong remains uncertain making it one of the most serious challenges for Xi Jinping. There are no signs to indicate that the current protests in Hong Kong are going to end soon.

China and East Asia

2019 marked the 8th anniversary of China-Japan-Republic of Korea (ROK) meeting. All three leaders met in Chengdu.22 In 2019 China and Japan made efforts to stabilise the bilateral relations. In June 2019, Xi Jinping and Shinzo Abe met ahead of the G-20 meeting and reached a 10-point consensus to jointly promote the healthy development of bilateral relations. 23 On 4 December 2019, Wang Yi visited South Korea. The two sides agreed to enhance bilateral cooperation and work towards the China-South Korea free trade area.24

China and ASEAN

China and ASEAN observed 2019 as the ‘Year of Media Exchanges’ and the two sides have carried out a series of exchange and cooperation activities, to promote understanding and friendship between the media and the peoples of the two sides. China and ASEAN have boosted cooperation in international and regional affairs by jointly pushing forward the negotiations on the Regional Comprehensive Economic Partnership Agreement (RCEP), coordinating efforts to safeguard the rules-based multilateral trading system and strengthening communication on regional hotspots including the nuclear issue on the Korean Peninsula.25

China and Central Asia

Xi Jinping visited Kyrgyzstan and Tajikistan, in his five-day visit to Central Asia. He attended the 19th Summit of the Shanghai Cooperation Organisation (SCO) in Bishkek and also participated in the fifth summit of the Conference on Interaction and Confidence Building Measures in Asia (CICA) in Dushanbe, Tajikistan.26

China and West Asia

China’s engagement with West Asia also gained momentum in 2019. In January Qatari Emir Sheikh Tamim Bin Hamad Al-Thani met with Xi Jinping. The China-Qatar relationship has developed to the strategic partnership. Both sides accelerated the cooperation in energy, trade and economy, infrastructure construction, investment 5G, telecommunication and terrorism. 27 There was a state visit from UAE to China in July. A target of USD 200 billion was set by 2030. To achieve the target, 16 agreements and MoU were signed. It was also decided that China’s Everbright Group will set up its MENA financial and investment hub in the Abu Dhabi Global Market. 28

China –Europe

China-Europe relationship in 2019, received less attention due to the US-China trade friction. In November, China and Brussels signed intellectual property protection for 100 branded products from both sides. In December 2019, Wang Yi negotiated a China-EU investment agreement.29 In November, Poland’s Gdansk Port welcomed the first Euro-China Train (ECT) 30 and a direct freight train service was started from China to Europe. The first train left from Xian to Poland in December 2019. 31

China and South Asia

In September, Chinese Foreign Minister Wang Yi began a four-day trip to Pakistan and Nepal but he skipped his visit to India, on the pretext of constitutional changes relating to article 370.32

Xi Jinping visited Nepal in 2019 and became the first Chinese leader since 1996 to visit the country. China and Nepal signed 18 memorandums of understanding and two letters of exchange. The most important MoU was on conducting a feasibility study of the China-Nepal cross border railway project that connects Kathmandu to Jilong, a border town of the Tibet autonomous region of China.33

India-China relations

India-China Relations in 2019 had its ups and downs. The trade deficit between both sides decreased from USD 63 billion in 2017-2018 to USD 53 billion in 2018-2019. In January 2019, in an endeavour to address the one-sided trade issue, the Commerce Secretary of India Anup Wadhwan met the Vice-Minister of General Administration of China Customs (GACC) Zhang Jiwen in Beijing to discuss the issue of market access for Indian agricultural products. Both sides signed a protocol on the revival of the export of tobacco from India. In 2008 such agreement was signed for the first time.34 The signing of the agreement indicates access to the Chinese markets.

Besides the economic engagement, seven major developments marked the India-China relations in 2019. First, China’s support for Masood Azhar and attempt to thwart him from blacklisting. By putting the technical hold for the fourth time, China strengthened Masood Azhar’s role and his activities in Pakistan against India. This sent a hostile signal to India with a negative impact on India-China relations in the coming years.35

Second, as a part of the 70th anniversary celebration of China’s People’s Liberation Army Navy (PLAN), two Indian battleships; destroyer INS Kolkata and INS Shakti participated in the Chinese Navy’s Fleet review. Overall, ten countries participated in this review.36

Third, India did not participate in the Second Belt and Road Forum for International Cooperation. The Indian stance on the BRI remained unchanged. The government has laid down its position on 13 May 2017 and again on 5 April 2018. It has reiterated that “Our position on OBOR/BRI is clear and there is no change.” China continues to entice India to join it. After the second Belt and Road Forum for International Cooperation, the Chinese spokesperson said: “The BRI is an open, inclusive and transparent economic initiative for cooperation. We welcome the participation of all like-minded countries and will work together for win-win outcome consultation and cooperation”. 37

Fourth, Chinese negative and outspoken pro-Pakistan stance on the changes made to article 370. On 6 August 2019, the Chinese Ministry of Foreign Affairs Spokesperson, Hua Chunying issued two statements on the development. On Jammu and Kashmir, she said: “The relevant sides need to exercise restraint and act prudently.”38 On Ladakh she mentioned, “China is always opposed to India's inclusion of the Chinese territory in the western sector of the China-India boundary into its administrative jurisdiction.”39

It may be noted that at the behest of Pakistan, China raised the issue of abrogation of article 370 in the United Nation’s Security Council (UNSC). Although the meeting took place behind closed doors in New York, the Chinese Ambassador, Zhang Jun, addressed the reporters outside the chamber. She urged both India and Pakistan to “refrain from taking any unilateral action which might further aggravate” what was an already “tense and very dangerous” situation. Zhang Jun also claimed that the council members have “expressed their serious concern” regarding the current situation in Jammu and Kashmir. The situation should be resolved properly through peaceful means, in accordance with the UN Charter, the relevant Security Council resolutions and bilateral agreements.”40

Again in September 2019, speaking at the UNSC, Wang Yi, reiterated; “The Kashmir issue, a dispute left from the past, should be peacefully and properly addressed in accordance with the UN Charter, Security Council resolutions and bilateral agreement.” He further said “No actions that would unilaterally change the status quo should be taken. As a neighbour of both India and Pakistan, China hopes to see the dispute effectively managed and stability restored to the relationship between the two sides.”41 The Indian side retorted by stating that China should “respect India’s sovereignty and territorial integrity” and the developments are “entirely a matter internal to India.”

Fifth, Chinese President Xi Jinping visited India on the invitation of the Prime Minister Narendra Modi for the second informal summit. The previous informal summit was held at Wuhan in 2018. It was the 19th meeting between the two leaders. He was accompanied by a 90-member delegation. This was the first meeting between the leaders after China raised the abrogation of article 370 issue informally in the UNSC. The summit in a way soothed somewhat the strong feelings especially since China did not raise the issue of Article 370 during the informal discussions. During the meeting, Xi Jinping acknowledged that the idea of the informal summit was initiated by PM Modi. The Mahabalipuram meeting has set the platform for further interactions. Consequently, the Defence Minister of India has been invited to visit China to discuss issues related to defence and security. Notably, the success of the informal summit would depend on the development of bilateral relations in the next few months. Until then it remains to be seen if the ‘Chennai connect’ has been able to repair the disconnect that occurred in the last few months. 42

Sixth, the eighth Hand in Hand joint Army exercise was held in Umroi Cantonment, Meghalaya from 7-20 December 2019. It was an annual military exercise held under the United Nations mandate and around 130 soldiers each from both sides participated in the exercise.43

Seventh, the 22nd Meeting of the Special Representatives of India and China Boundary Talks was held on 21 December 2019. The discussion emphasised the early harvest of the boundary negotiations and reached a consensus on strengthening confidence-building measures. The negotiations were fruitful with the focus on taking the bilateral relations forward on the lines of the second Informal Summit.44

Implications for India

India-China relations started on a difficult note in 2019 but the bilateral relations were put on track during the Second Informal Summit. The two countries will observe the 70th anniversary of their relations in 2020. It will be followed by 70 commemorative activities that will include cultural, religious and trade promotion and military exchanges. As agreed, 35 events will be held in China and 35 events in India.
In 2020, China may increase its efforts to make inroads into the South Asian region. This was evident in Xi Jinping’s visit to Nepal. In Pakistan, China has already made strategic inroads. With the change in government in Sri Lanka and the country trapped in debt, China’s presence is likely to increase. Given its energy demands and security imperatives, the Chinese will strengthen its efforts to expand their presence in the Indian Ocean Region.

Conclusion

In the New Year eve speech, delivered on 31 December 2019, Xi Jinping had called up for achieving the target of the first centenary goal of building a ‘moderately prosperous society’ in all respects.45 In his speech, he highlighted the achievement of his administration in 2019 in the social, economic, science and technology and space.46 On the International front, the ongoing anti-China protests in Hong Kong was the main setback for China and Xi Jinping. He indicated that the Belt and Road Initiative will be the major driver of the Chinese Foreign policy and reiterated the Chinese position on Taiwan and claimed its sovereignty.47

Further, the two leaked classified government documents about China’s programme of the mass detention of Muslim minorities in Xinjiang have raised the question about possible dissent amongst government officials. 48 The US-China trade war, the slowing economy and the Hong Kong crisis have emerged as the new challenges for Xi Jinping. Notably, in April 2018, Xi Jinping had chalked out “three tough battles (preventing financial risks, reducing poverty and tackling pollution)”49 that his party must win in 2020, to be on the right track for achieving the “great rejuvenation of the Chinese nation” by 2049. Thus 2020 is a very critical year for China to attain its first centennial goal.

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(The paper is the author’s individual scholastic articulation. The author certifies that the article/paper is original in content, unpublished and it has not been submitted for publication/web upload elsewhere, and that the facts and figures quoted are duly referenced, as needed, and are believed to be correct). (The paper does not necessarily represent the organisational stance... More >>


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