Three Rings: Building a New International System in the Face of Western Decoupling by Cheng Yawen

"China and developing countries need to break the current core-periphery world order."

Dear Everyone,

I have long been wanting to share the following piece by Cheng Yawen (程亚文) entitled “Building the ‘New Three Rings’: China's Option in the Face of a Potential Complete Decoupling” and thought it would be fitting to do so during the visit to China of one of the Global South’s main representatives – Brazil’s President Luiz Inácio Lula da Silva. Cheng’s article was published last summer by the respected Beijing Cultural Review (文化纵横, hereafter BCR) and reposted again online following the China-brokered Saudi-Iran deal last month. As will be made evident later, this was no coincidence.

Like Cheng, Yang Ping (杨平), BCR’s editor-in-chief and director of the Longway Foundation (修远基金会), has been calling on his country to build a “new type of international system” in response to China’s perceived alienation from today’s US-led international order. Both Yang and Cheng want their country to revise their current international strategy by refocusing their diplomatic efforts away from the West towards the Global South (Russia included). Both also want their government’s engagement abroad to be less growth-driven and more focused on political and security objectives. The end result being the emergence of a parallel system free from Western interference.

For those of you new to this newsletter, keep in mind that Yang and Cheng’s views represent one of several differing and, at times, opposing lines of thought on this matter in China. Indeed, as already discussed here a couple of months ago: “How to respond to the growing political divide between China and the West marked by partial decoupling, security alliances, and the risk of sanctions, amongst other things, continues to be a major topic of discussion among China’s intellectual elite. As already evidenced in previous editions of this newsletter, opinions vary considerably. Those presented here so far have ranged from Da Wei (达巍) stressing the importance of preserving if not strengthening ties with the West and Shen Wei (沈伟) arguing in favour of reforming the WTO and building up a network of free trade agreements to Ye Hailin (叶海林) emphasising the need for China to demonstrate its military might to demobilise US allies and Lu Feng (路风) calling for self-reliance and greater assertiveness in the field of tech. A certain amount of overlap certainly exists among these perspectives but the differences are nonetheless striking.” How favourable Xi and his colleagues in Zhongnanhai are to each of these views or even camps is anyone’s guess.

This post was made possible thanks to the generous help of Daniel Crain who translated today’s excerpts.

SUMMARY

1. US-led globalisation and capitalism drove NATO's eastward expansion. This, in turn, has been the “main reason” behind Russia’s offensive in Ukraine.

2. Western-style globalisation is coming to an end.

3. China’s rise is threatening the current US-led international order whose rules have been designed to benefit the West.

4. The conflict in Ukraine has laid bare the West's intent to unite in order to suppress non-Western countries – China and Russia in particular. The US has made clear that “it will not rest until China is defeated”.

5. The West’s decoupling from China is set to accelerate and will continue “for a long time to come”. China’s being hit in its turn by Russia-like sanctions remains a possibility.

6. Beijing should therefore “create a new international environment conducive to safeguarding China's national security and long-term development.” It should do so by reassessing “China's past tradition of multilateralism” and by shifting its diplomatic focus away from the West towards the Global South (Russia included).

7. This, however, does not mean completely shunning the West. Engaging and even developing cooperative relations with western countries should continue whenever possible.

8. China should categorise its diplomatic relations with the world into “three rings” and prioritise these as follows: 1. East Asia, Central Asia and the Middle East; 2. Other developing countries in Asia, Africa, and Latin America; 3. Europe, the US and other industrialised countries.

9. To foster this change, China should:

   1. Encourage the emergence of a new international payment system, promote the internationalisation of the RMB and provide support for currencies other than the USD (such as the euro).

   2. Upgrade the New Development Bank and Asian Infrastructure Investment Bank.

   3. Establish a common energy market and payment network with other Asian countries (incl. the Middle East).

   4. Strengthen both financial and security cooperation with other Shanghai Cooperation Organisation (SCO) members and Iran.

   5. Deepen East Asia’s (as understood in its broadest sense) economic integration.

   6. De-emphasise growth-driven strategies in favour of political and security-related ones. This will help reduce Western interference in the region.

   7. Use the BRICS as a catalyst for South-South cooperation.

10. “The emergence of a new world-system and the deepening of South-South cooperation will allow China to enter the forefront of the world economy and politics.”

THE AUTHOR

Name: Cheng Yawen (程亚文)
Age: 50/51
Position: Researcher and doctoral supervisor at the School of International Relations and Public Affairs, Shanghai International Studies University; Member of the Beijing-based think tank Pangoal Institution.
Other known roles: Worked at the PLA Academy of Military Sciences’ Department of War Theory and Strategic Research.
Research focus: Comparative politics; globalisation and political change (amongst other things)
Education (tentative): MA at People's Liberation Army National Defence University
Experience abroad: Unknown

BUILDING THE "NEW THREE RINGS": CHINA'S OPTION IN THE FACE OF A POTENTIAL COMPLETE DECOUPLING
Cheng Yawen (程亚文)
(June 2022)

1. Introduction

“Russia's ‘special military operation [特别军事行动]’ in Ukraine and the ensuing full-scale confrontation between the West and Russia is a landmark event in the trend towards the 'end of globalisation [全球化大潮走向终结]' that has been underway since the 1980s. The US is coercing its allies to impose ‘deadly’ sanctions [欲置之于死地的制裁] on Russia and is pressuring the rest of the world to choose sides between the West and Russia. [This] is already causing the world to return to the deadly 'live or die [你死我活]' struggles of a century ago and poses an enormous challenge to China.”

“The 'end of globalisation [全球化终结]’ has left China without the [favourable]  external development environment it has had for the past four decades. [Meanwhile,] the American push to rebuild the US-led international system and ‘decouple [脱钩]' from China and Russia is very likely to intensify in the future.”

“The world today is marked by a paradigm shift [范式性变革]. Faced with the possibility of a reactive but comprehensive decoupling, China needs to adjust its foreign policy strategy proactively and make new choices in its national engagement priorities. [China must] shape a new international system that is conducive to hedging against the negative impacts of the West’s decoupling.”

2. The Russo-Ukrainian conflict as result of US-led globalisation

“In recent decades, the process of globalisation and the pursuit of US power have been two sides of the same coin. Both are mutually conditional and mutually reinforcing. Russia’s 'special military operation’ in Ukraine is a result of the [US-led] globalisation fully exposing its true strength. [This crisis] is also drawing US-led globalisation to a close.”

“NATO's eastward expansion is the main reason behind the launch of Russia's attack. This appears to be a security issue, but it is also an economic one [arising from] globalisation. In initiating [发起] globalisation, the US sought to peripheralise [中外围化] the Soviet Union. When Russia [attempted] to use globalisation to achieve national rejuvenation [国家复兴] and become a core country [中心地带国家], it clearly violated the logic of the [US-led globalisation’s] occurrence and progression. Global capital, especially financial capital, is most interested in Russia for energy, food and mineral resources, all areas where financial capital stands to make huge profits. But since Putin came to power, Russia has tightened its grip on key industries that are vital to national security and the basic livelihoods of its people [基本民生]. [At the same time], Russia has dedicated itself to building a Eurasian Economic Union [欧亚经济联盟]. Foreign capital is not happy about Russia’s commitment to shape an economic development space to suit itself. NATO's expansion to the east is a manifestation of capital-led politics seeking market expansion, which continues to squeeze Russia's development space and intensify its peripheralisation [外围化]. If no effective response is made, Russia will be further locked in as a source of primary products [初级产品], forfeiting its ability to participate in great power politics and even risking a domestic crisis. This is something that Russian elites do not want to see.”

3. A Wallersteinian view of the world – China as a disruptor of the Western-dominated core-periphery international order

“The hierarchical core-periphery international order under the European colonial system has not really disappeared [see Immanuel Wallerstein’s World-Systems Analysis]. It has continued as a subtle and hidden order. While the once direct and absolute hierarchical power relations no longer exist, they have been replaced by a 'common but disparate [共同而有差别]’ international order. On the surface, all nations are equal in terms of sovereignty, but in practice there are still differences in power. The [so-called] ‘rules-based order’ is the main expression of this order, in which all nations are subject to the same rules. However, the real content [内涵] of these rules places Western countries, rather than the United Nations and international law, at their centre.”

“The global system’s division of labour, rule-making, money supply and industrial production are the privileges of a few core countries. Any attempt by others to join in risks disintegrating the dominant position of those select [privileged] countries. The nations who benefit from the current system refuse to see [any challenge] to their rule-making, monetary dominance and technological superiority via intellectual property rights. China's surprising economic growth in recent decades has disrupted this post-war core-periphery international order [战后以来的中心-边缘国际秩序], and has [therefore] threatened the unwritten Western-centric rules. In recent years, the US has defined China as a major 'strategic competitor [战略竞争对手]’ and has made clear that it will not rest until China is defeated.”

“Both the expansion of NATO in the east and America’s targeted suppression of China reflect how the US and the West want to preserve and strengthen their own power advantage.”

4. China should focus its diplomatic efforts on non-Western countries.

“In the opening chapter of the 'Selected Works of Mao Zedong [毛泽东选集]’, [entitled] the 'Analysis of the Classes in Chinese Society [中国社会各阶级的分析]', a question is posed: 'Who are our enemies? Who are our friends? This is a question of first importance for the revolution [谁是我们的敌人？谁是我们的朋友？这个问题是革命的首要问题].’ Over the past four decades of Reform and Opening Up, and [especially] in recent years with [our] initiative to build a Community of Common Destiny for Humanity [人类命运共同体], China has moved its international engagement away from deliberately emphasising the distinction between friend and foe. Instead, it hopes that by 'appreciating the beauty of all cultures [各美其美, 美人之美]’, it can promote [the fact that] 'when the beauty of all cultures is recognised by all, Tianxia [lit. ‘all under heaven’ or ‘the world’] will achieve Great Harmony [美美与共，天下大同]' [Note: Cheng is quoting Chinese sociologist Fei Xiaotong (费孝通). This saying has since been used by Xi in speeches and writings: see here].”

“But whether or not Tianxia [天下] can achieve Great Harmony [大同] is not determined by the wants of China alone. With the US-led West moving towards full-scale confrontation with Russia and China, the contemporary world can no longer be viewed mechanistically as one of 'peace and development’. Instead, it must be seriously considered [through the lenses of] 'competition [竞争]' or even 'war [战争]’. Even if war can be ruled out, it is no longer possible to try to achieve better development in a globalised system dominated by the West as [we did] in the past. China must rethink the 'question of first importance [首要问题]’ in its foreign engagements: who can China possibly cooperate with now and in the future, and who are those whom China cannot draw into cooperative partnerships?”

“China's base for developing multilateral cooperation lies in non-Western countries.”

“By focusing its multifaceted diplomacy [全方位外交] on non-Western developing countries, China would certainly not exclude dealing with or even forming cooperative and friendly relations with Western countries and other major powers.”

“However, it is also important to note that China's past engagement and cooperation with the ‘core countries’ has always been based on two premises. First, from its own point of view, China insists on developing its foreign relations on the basis of self-determination [独立自主], equality, and reciprocity. It [also] opposes the hierarchy of power [权力等级] in international relations. Second, from the perspective of the ‘core countries’, their cooperation with China has always had a ceiling; that is, they cannot risk destabilising the Western-centric global power structure. If these two premises were to [be] altered in any way, it would be difficult for a developing country like China to continue forming deep cooperative relations with the West, especially political ones.”

5. Creating “a new international environment conducive to safeguarding China's national security and long-term development”

“Over the past four decades, China has abandoned [emphasising] differences in ideology and national [political] systems. It has [instead] committed itself to cooperating with all countries, gradually forming a pattern of foreign engagement in which 'great powers are key, the neighbourhood is of first importance, developing countries are the foundation, and multilateralism is an important platform [大国是关键、周边是首要、发展中国家是基础、多边是重要舞台].’ However, in the context of the ‘end of globalisation [全球化终结],’ this pattern has hit one obstacle after the other. The US is forcing [裹挟] other Western countries to decouple from China in areas such as the economy, technology, knowledge and people-to-people exchanges. This ‘decoupling’ is unlikely to be rolled back as a result of the conflict [战火] between Russia and Ukraine. On the contrary, it is likely to intensify [变本加厉].”

“Under the ‘great changes not seen in a century [百来未有之大变局]’, Western countries have shown an increasingly strong intent to suppress potential challengers. This has become especially true following the outbreak of the Russo-Ukrainian conflict [战火], which has exposed clearly [暴露无遗] the West's tendency to gather together and suppress non-Western countries on all fronts. This [tendency] will become a structural feature in international relations for a long time to come. China must remain particularly vigilant about [the danger that] the sanctions and repressive tactics used by the West against Russia could similarly be applied [如法炮制] to China in future. For these reasons, it is urgent to re-examine China's past tradition of multilateralism, adjust the spatial pattern of its foreign relations and strengthen cooperation with non-Western developing countries. [All this must be done] with the utmost urgency [迫在眉睫] in order to create a new international environment conducive to safeguarding China's national security and long-term development.”

6. Prioritising China’s diplomatic relations based on “three rings”

“In 1974, Mao Zedong proposed a division of the 'three worlds [三个世界]’, which identified three types of countries in the world at the time and analysed how China could engage with each of them. Developing countries of the 'third world [第三世界]’ were identified as China's main partners for engagement.”

“Since Reform and Opening Up [began in 1978], China has placed more emphasis on cooperating with Western countries. In future, China will have to give greater prominence to fostering South-South cooperation [南南合作]. Whether seeking diplomatic breakthroughs, long-term development or national rejuvenation [国家复兴], China’s foreign policy strategy will, for the foreseeable future, have to focus primarily on promoting the construction of a new global system anchored in Asia and its surrounding regions. The final result of this should be a ‘three-ringed [三环]’ international system to safeguard China's national security and development.”

• “The first ring [should] consist of neighbouring East Asia, Central Asia and the Middle East. East Asia is connected to the world's financial resources and China has already formed an inseparable industrial division of labour with the countries in this region. [Meanwhile,] Central Asia and the Middle East are connected to the world's natural resources. China has to rely on the countries in this region for a stable energy supply and a reliable ‘security barrier’ [安全屏障].”

• “The second ring [should] consist of the numerous developing countries in Asia, Africa, and Latin America, with whom China trades raw materials and industrial goods. China’s foreign aid should be directed primarily towards these countries.”

• “The third ring [should] extend to the traditionally industrialised countries – mainly Europe and the US – with whom China trades industrial goods, technology, and knowledge.”

“This 'three-ringed' structure would be used to organise the relative importance [轻重缓急] and orientation [前后左右] of [China’s] foreign exchanges and redefine the direction and content of [our] engagement abroad.”

“The key priority when building a 'new three-ringed [新三环]’ international system is the 'first ring [第一环]’, which consists of the two wings of Asia: the first wing being East Asia, and the other being Central Asia and the Middle East. In order to deepen East Asia’s economic integration and strengthen [our] links with Central Asia and the Middle East, we must enrich the topics of engagement among Asian countries. Over the past few years, China has devoted itself to promoting economic diplomacy with other countries. It has strongly advanced economic integration [一体化] in East Asia and cooperation with many Asian countries [more broadly]. The latest groundbreaking development in East Asian economic integration has been the finalisation of the Regional Comprehensive Economic Partnership Agreement [区域全面经济伙伴关系协定] (RCEP), which after years of negotiations came into effect on January 1st, 2022. However, in recent years, economic interactions between East Asian countries have been increasingly impacted by foreign forces and security factors. Disputes over maritime rights in the South China Sea and the US’s 'Indo-Pacific’ strategy have added uncertainty to the process of East Asian economic integration. China should move away from its previous approach of 'GDP above all else [GDP 至上主义]’ in its foreign relations. [Instead, China should] pay close attention to political and security issues and promote more security cooperation among Asian countries [in order to] avoid the exploitation of Asia’s internal issues by external forces.”

7. Upgrading South-South (incl. Russia) cooperation to a new level

“The foundation for China's drive to construct a ‘new three-ringed’ international system is 'South-South cooperation [南南合作]’ – an older concept which emphasises mutual cooperation and support among non-Western 'third world [第三世界]' countries. In the latter half of the 20th century, the significance of South-South cooperation [南南合作] was more politically oriented. Developing countries, held back by their underdeveloped economies and lower levels of technology, were of limited help to one another in terms of trade and technology exchanges. [Therefore], they had little impact on the global economy.”

“Since the 1990s, the concept of 'South-South cooperation [南南合作]’ has faded from view and has received little attention in Chinese international relations circles. However, 21^st century 'South-South cooperation [南南合作]' is in the process of building new foundations and is now becoming a more realistic possibility. The main reason for this is that in recent decades, developing countries in Asia, Africa, and Latin America have become industrialised or quasi-industrialised as they catch up with the wave of globalisation and 'borrow the ladder to get to the top [借梯上屋]’.”

“To date, developing countries have taken initial steps towards forming a global economic system. However, further economic and political integration is required in order to increase economic linkages, strengthen these [countries’] political influence in the international arena and escape the control or coercion of the West. [All] this, however, requires the minority of countries that have already achieved a higher level of social and economic development to drive [this process].”

“For the economic and political autonomy of developing countries to be upgraded further and for emerging economies to gain political influence in the world [在世界体系中] commensurate with their economic weight, they must break away from their financial and monetary dependence on Western countries. Therefore, the construction of a 'new three-ringed [新三环]’ international system must not only take into account traditional geopolitical factors, but also important metrics such as currency and information. Over the past few years, China has explored these aspects by conducting currency swaps with some emerging market economies. Between developing countries, a higher level of, and a broader scope for, financial and monetary cooperation should be more widely developed. To these ends, it is necessary to make good use of some existing platforms and mechanisms to upgrade South-South cooperation [南南合作] to a new level. [We should]:

1. Upgrade and revamp the Asian Infrastructure and Investment Bank [亚投行] and the BRICS New Development Bank [金砖国家银行]. [Additionally], an autonomous and controllable [自主可控] international payment system [should be] improved.

2. Strengthen security cooperation within the Shanghai Cooperation Organisation (SCO) as well as China-Russia-India-Iran [中俄印伊] cooperation within its framework – financial cooperation in particular. [Furthermore,] we must recognise that Russia is also a developing country, and that China and Russia’s economies are highly complementary.

3. Deepen economic integration in East Asia within the framework of the Belt and Road Initiative, especially by consolidating the achievements of RCEP.

4. Build a common energy market in Asia, so that the energy-buying markets in East and South Asia and the energy-selling markets in the Middle East, Central Asia, and Russia can coexist in a single energy trading and payment network.

5. Make good use of the BRICS meeting mechanism to lead the deepening of South-South cooperation.

6. Promote the diversification of the international monetary system and the internationalisation of the RMB in the context of South-South cooperation in order to hedge against the hegemony of the US dollar while providing appropriate support for the euro’s international standing.”

“One hundred years ago, the leaders of the Chinese Communist Party put forward the revolutionary path of 'encircling the cities from the countryside [农村包围城市]’. At this time of 'great changes not seen in a century’ [百年未有之大变局]’, China and the [world’s] developing countries need to break the current core-periphery world order [中心-边缘秩序] and the West’s preventative suppression [防范打压] of non-Western countries. [Together, we] must also ensure solidarity and cooperation in the world’s ‘rural’ areas.”

“The emergence of a new world-system and the deepening of South-South cooperation will allow China to: enter the forefront of the world economy and politics; marshal [调度] global resources to build a ‘three-ringed’ international system; alleviate international pressures [化解国际压力]; and break through encirclements [突破重围].  After more than forty years of Reform and Opening Up [改革开放], China must adjust its understanding of 'Opening Up [开放]’ and achieve a new breakthrough in its thinking on foreign relations [对外往来]. Of course, whenever possible, China must strive to maintain cooperation with the West. As long as the latter does not choose to make a complete enemy of China, we must not abandon meeting them halfway [相向而行].”

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