At this year’s ISA, Shahar Hameiri and I talked about our new research project on state transformation and rising powers, with specific reference to China. In a nutshell, we suggest that, like other states, those of so-called ‘rising powers’ are undergoing epochal transformations associated with transformations in the global political economy since the late 1970s, profoundly conditioning how they are ‘rising’.
Although ‘rising powers’ are a very ‘sexy’ topic in IR at the moment, with a vast literature emerging over the last decade, the discipline’s treatment of the subject is remarkably basic. IR scholars cling to a systemic focus in their studies: realists ask if rising powers can be contained within the balance of power; liberals, if hegemonic liberal institutions can accommodate their rise; constructivists, whether rising powers’ ‘identity’ is compatible with existing norms; and even Marxists take a systemic view, warning of the possibility of inter-imperialist rivalry, new counter-hegemonic alliances, or emphasising the robustness of the US-dominated historic bloc.
The reference point of many IR scholars remains the 19th century, when Prussia’s rise heralded the last major shift from unipolarity to multipolarity. They do not even bother to ask whether the so-called ‘units’ of IR – states – might have changed since this time. This is despite extensive work on the changes in statehood that have occurred in the last few decades in fields like International Political Economy, Comparative Politics, Political Geography and Comparative Politics. IR scholars largely dismiss this work as irrelevant when discussing rising powers, assuming that these states are traditional, ‘Westphalian’ states, or positing a historical reversal of the transformatory processes associated by globalisation, claiming that ‘the way [is] being paved back to Westphalia… by rising powers… who are staunch guardians of the principle of national sovereignty’ (pp. 1016-7). The tedious and unimaginative references to China as a ‘dragon’ in the titles of much scholarly (and journalistic) literature portrays China as a single-minded, dangerous beast.
For us, this all seems misguided. Over the last four years, Shahar and I have been researching how non-traditional security (NTS) issues like environmental degradation, pandemic diseases and transnational crime are understood and managed. Our forthcoming book, Governing Borderless Threats, argues that the predominant mode of governance for these issues is the transformation of statehood. Parties concerned to mitigate NTS issues push for the state apparatuses dealing with them in territories where they originate to be internationalised: to be reconfigured to impose international disciplines on other parts of their states and societies, and ‘rescaled’ through their insertion into complex, multilevel, networked forms of transnational governance. Crucially, we found this was happening even in Asia, which is supposedly home to the world’s most devoutly ‘Westphalian’ states, clinging irrationally to norms of sovereignty and non-interference. So, even in the region most affected by China’s rise, there is no road being ‘paved back to Westphalia’. In fact, as we investigated Asian state transformation – and its socio-political contestation and the political economy relations structuring it – we began to suspect that China itself was undergoing similar processes.
State Transformation in China
Indeed, we quickly found that, while IR scholars typically depict China as a highly robust, coherent, ‘strong’, ‘Westphalian’ state, Sinologists have argued for decades that the Chinese state is nothing of the sort. Instead, it has undergone considerable fragmentation, decentralisation and uneven internationalisation associated with the shift from Maoist state ‘socialism’ to state-managed capitalism.
Fragmentation is visible across the Chinese state. Piecemeal reforms since the late 1970s has dispersed authority across a vast array of national ministries and agencies, such that many enjoy overlapping and competing jurisdictions. China’s oceans and energy policies, for example, are each overseen by 11 different national bodies. The central state is now a ‘regulatory state’: having retreated from its direct role in organising economic production and distribution, it now largely sets a range of very general policies and goals that it hopes Chinese actors will follow. Many state-owned enterprises (SOEs) have been privatised, while the larger ones have been conglomerated and ‘corporatised’: they now operate as largely independent, profit-seeking, capitalist enterprises, often answerable to foreign shareholders. Powerful corporatised SOEs have the capacity to subvert or ignore government policy, often pursuing quite contradictory behaviour, including overseas since their internationalisation in the 1990s.
For example, China’s National Oil Companies (NOCs) are notably autonomous, pursuing hydrocarbons wherever they can and overwhelmingly dumping them onto international markets – not bringing them to China as many often assume. Given that the only oil fields not already cornered by the Western oil majors are in so-called ‘rogue’ states (e.g. Sudan) or disputed territories (e.g. the South China Sea), ‘China’ is frequently accused of evil strategies to grab resources. In reality, the NOCs are acting autonomously, leaving the Ministry of Foreign Affairs (MFA) to fend off international criticism.
The Chinese state has also decentralised quite radically since the 1980s, as provincial governments have been granted wide latitude to spur capitalist transformation and increase economic growth. Although Mao attempted two rounds of de- and re-centralisation, this merely involved shifting the level of administrative oversight. Today, China’s provincial governments exercise enormous and unprecedented legislative, political and managerial authority. The provinces took control of many SOEs, privatising some into the hands of local cadres, and now control large amounts of public revenue, with the centre dependent on their tax-collection. They are empowered to enact legislation that extends and interprets national laws and policies. Some have used this to erect internal regulatory barriers, shattering the national economy into local ‘dukedoms’. The provinces are also empowered to conduct their own international economic relations, and have their own departments dealing with foreign affairs and trade. They autonomously pursue trade and investment deals with states near and far – as far afield at Africa. As their economies have internationalised, they have become far better integrated with the economies of neighbouring states than with other parts of China. Provincial governors are now extremely influential. No governors were part of the Politburo in 1982; by 2002, two-thirds of its members were serving or former provincial officials. Thanks to this onset of ‘de facto federalism’, and despite recurrent efforts to recentralise authority, China has become ‘a voluntary regulatory state, with local authorities still able to decide whether to adhere to central regulation or not’ (p. 72).
Finally, parts of China’s economy and state have become unevenly internationalised. The coastal regions are heavily integrated into global circuits of trade and finance, with commensurate interests and overseas presences. Reformist technocrats in central ministries have promoted compliance with international norms and governance projects as part of their quest to liberalise the economy. Chinese officials are now part of the Basle banking system, for example, while WTO membership was promoted to spur further pro-market deregulation. Yet, this is resisted by actors and agencies standing to lose power and resources from such changes. For instance, resistance from the provinces, the ministry of commerce, and the ministry of finance, has vastly compromised China’s adherence to WTO rules and retarded the liberalisation of the renminbi, sparking recurrent conflict with the United States.
The Chinese state is therefore best understood as a very complex system of multilevel governance. Struggles over power and resources now occur constantly among and between different levels of the state apparatus.
The Consequences for Foreign and Security Policy
These very profound changes in China’s statehood have equally profound consequences for how security and foreign policy are made and executed in practice. China is not pursuing a ‘grand strategy’, displaying a coherent ‘identity’, or even pursuing a clear ‘national interest’. Instead, multiple state and quasi-private entities are pursuing often-uncoordinated and sometimes quite contradictory actions overseas.
Thus, despite being theoretically responsible for Chinese foreign policy, the MFA faces intense rivalry from many other foreign policy actors and is frequently overridden by them. The MFA was always weak; now, the foreign minister struggles to make the top 50 in the Central Committee. Its rivals include the various branches of the People’s Liberation Army, the ministries of finance and commerce, the state security apparatuses, the central bank, the national development and reform commission, the Chinese Communist Party’s (CCP) international department, provincial governments, and major corporatised SOEs. The MFA lacks the authority to instruct equally-ranked ministries or provincial governors; indeed, it struggles even to coordinate these other actors. The foreign affairs bureaux in the provinces report to both the MFA and the governors; since they owe their positions to the latter, they largely serve local interests.
Reflecting the state’s retreat to a ‘regulatory’ model, the centre’s role in foreign policy is now to lay down general policy guidelines for others to follow. And occasionally, the centre responds to the crises created by incoherence by trying to recentralise authority over foreign and security policy. ‘Small Leading Groups’ of the Politburo are frequently established to try to improve coordination, along with other ad hoc institutions, diplomacy work conferences, and major policy initiatives.
This has some traction, insofar as Chinese officials must display loyalty to ‘national’ priorities in order to advance through the CCP. However, central policy guidelines are often extremely vague, allowing inventive officials to ‘justify almost anything’ (p. 1). Moreover, as the main agents implementing policy, national and subnational agencies enjoy considerable latitude to resist, subvert or ignore central diktat.
The South China Sea
The South China Sea (SCS) provides a good example of the crisis-ridden, incoherent policy outputs of China’s fragmented, decentralised and unevenly internationalised state. Rich in hydrocarbons and fisheries, the SCS is regarded as perhaps the most serious security ‘flashpoint’ in East Asia outside the Korean Peninsula. China has issued vague claims to a vast area of the SCS, within a ‘nine-dashed-line’, which overlaps with the claims of six Southeast Asian states.
Rising tensions in the SCS are widely seen, especially by realists, to herald growing Chinese aggression commensurate with its burgeoning power resources, and a ‘grand strategy’ to grab territory and resources. The reality is far less coherent.
The MFA has virtually no control over China’s SCS policy, being routinely bypassed by more powerful actors. A further dozen agencies have some jurisdiction in this domain, including Ministry of Agriculture’s Bureau of Fisheries Administration, China Marine Surveillance, provincial governments, the navy, the NOCs, and, until recently, six law enforcement agencies under four different ministries. Thus, while the MFA has promoted a cooperative approach – ratifying and implementing the UN Convention on the Laws of the Sea (UNCLOS) and agreeing a Declaration on Conduct on the SCS with ASEAN in 2002 – it is persistently undermined by rival entities.
The PLA Navy, for example, has repeatedly and successfully used sovereignty disputes in the SCS to defend and expand its budget and remit. To this end, the Navy seized the Paracel Islands from Vietnam in 1988, while the Navy’s 1995 seizure of Mischief Reef (disputed with the Philippines) was reportedly extracted in exchange for its support of incoming premier Jiang Zemin.
China’s largely-autonomous NOCs also generate crises in the SCS. China’s National Offshore Oil Company (CNOOC) has repeatedly issued hydrocarbon concessions in disputed waters despite MFA protests, sparking protests from neighbouring countries. The NOCs ally with other Chinese agencies to pursue their goals. In 2007, the China National Petroleum Company (CNPC) got Ministry of Land and Resources backing to start oil exploration in the Zhongjiannan Basin, and area disputed with Vietnam. Vietnamese coastguards harassed CNPC’s survey vessels, but CNPC was able to summon ships from China’s State Oceanic Administration to the scene; they rammed the Vietnamese craft, sparking an international incident. The project was shelved in 2008 under MFA pressure, but in 2014, CNPC placed a CNOOC rig in Vietnamese-claimed waters, accompanied by 80 Chinese ships including seven naval vessels. This caused a massive diplomatic crisis. As usual, the MFA was forced to construct a post-hoc rationalisation, claiming that the rig was in Chinese waters – a position violating UNCLOS. The rig was later withdraw under a face-saving formula, probably reflecting further high-level struggles.
The provincial government of Hainan is also a highly provocative actor. Shut out of hydrocarbons, it has pursued enrichment by financing the expansion of its state-owned and private fishing fleets into the SCS, having overfished China’s coastal waters. Hainan has subsidised upgrades to trawlers, provides rescue services for ships in distress, and finances expeditions into disputed waters. The vast majority of the incidents in the SCS are caused by this state-backed capitalist expansion. They involve Chinese vessels being confronted by other countries’ coastguards while allegedly poaching; the trawlers then call on their provincial maritime agencies to rescue them, sparking an international confrontation. There were 380 such incidents from 1989-2010, involving 750 Chinese ships. Hainan has also taken provocative acts like expanding administrative jurisdictions and PLA garrisons and interpreting national policies with local laws that lay claim to vast oceanic areas and demand that foreign vessels in this area seek permission from Chinese authorities. Hainan justifies these actions with constant reference to China’s national policy of defending its ‘maritime rights’. In reality, it is pursuing economic ends with scant regard for the impact on China’s foreign relations.
Implications and Further Research
The implication of cases like this is that IR theorists can be right, for the wrong reasons. Realists are not necessarily wrong to highlight the threatening nature of China’s rise, but they are wrong to attribute it to growing ‘national’ power and a sinister ‘grand strategy’ of phased expansion. The optimism of liberals and constructivists is tempered by a recognition that internationalisation and normative ‘socialisation’ may apply to only some state agencies, and even then may not be liberal in character. Moving IR-theoretical treatments of rising powers forwards must involve a more sophisticated understanding of the ‘units’ of IR. This goes beyond the state approach of ‘levels of analysis’ because the transformation of statehood in recently decades has clearly blurred the distinction (if it was ever not blurred) between the international and the domestic. There are constant struggles within the Chinese state over the scale at which an issue should be managed – provincial, national, or international – and by whom. To understand how China is rising, we need to attend to this process of state transformation and the new socio-political contestations that are driving it.
In our future research, Shahar, Shaun Breslin and I hope to do just this. We want to look at both how state transformation is shaping Chinese external conduct, and how Chinese agencies are also promoting state transformation in their near abroad to pursue their interests. For the first angle, we propose an in-depth study of the SCS and to investigate Chinese aid practices in East Asia. Chinese aid is regularly said to be part of a grand strategy to displace the Western donors and substitute the ‘Beijing consensus’ for the Washington consensus. But we think there is good evidence that Chinese aid is actually driven in a rather chaotic fashion from the bottom up, by Chinese construction firms, linked to provincial governments, lobbying for tied aid. To investigate Chinese-promoted state transformation elsewhere, we want to look at the Greater Mekong Subregion, where China’s Yunnan province has been ‘rescaled’ to assume a regional governance role in economics and security. Yunnanese capital has been extensively regionalised and, following suit, Yunnan’s ‘governance frontier’ has extended. It has promoted extensive infrastructural and regulatory changes to promote Chinese capital, and also started managing non-traditional security threats like narcotics, HIV/AIDS and piracy on the Mekong. We want to investigate how this is received and contested across Indochina, to see how China’s rise is experienced transnationally in other societies.