In his recent Insight article, Chris Trotter suggested that China was ready to “step up” in the wake of the Wuhan virus. China’s economy, he argued, was being “slowly cranked up – to the immense relief of the world”. While the first part is certainly true (insofar as we can believe anything we’re told by China), the second is highly disputable.
In fact, it seems clear that a significant portion of the world is royally pissed off that China is plainly seeking to capitalise on the devastation its actions unleashed.
That’s as true of some governments as many ordinary citizens. Britain’s Johnson government is reportedly “furious” at Beijing. The Trump administration has repeatedly lashed China. The Morrison government is likewise signalling its unhappiness.
Japan is not only also clearly unhappy, it’s doing something about it. And China is worried.
Japanese Prime Minister Shinzo Abe has proposed building an economy that is less dependent on one country, China, so that the nation can better avoid supply chain disruptions.
The call touched off a heated debate in the Chinese political world.
In Zhongnanhai, the area in central Beijing where leaders of the Chinese Communist Party and the state government have their offices, “there are now serious concerns over foreign companies withdrawing from China,” a Chinese economic source said. “What has particularly been talked about is the clause in Japan’s emergency economic package that encourages (and funds) the re-establishment of supply chains.”
Indeed, the Wuhan virus has catalysed a sharp policy reversal from Japan. Xi Xinping was scheduled for his maiden state visit to Japan. Now, the visit is cancelled, and the “new era of Sino-Japanese relations” looks very different indeed.
[On] the same day the postponement of Xi’s Japan visit was announced, the Japanese government held a meeting of the Council on Investments for the Future. Abe, who chairs the council, said he wanted high value-added product manufacturing bases to come home to Japan.
[…]”we should try to relocate high added value items to Japan,” [Abe] said. “And for everything else, we should diversify to countries like those in ASEAN.”
Abe’s remarks were clear[…he] was forming a “shift away from China” policy.
On April 7, Japan adopted an emergency economic package which included over ¥240 billion ($NZD 3.7 billion) to assist Japanese companies in moving production out of China.
The next day, April 8, China’s Politburo Standing Committee, the party’s top decision-making body, held a meeting in Beijing[…]Xi sounded the call to prepare for “a protracted battle” while assuming the worst.
The fact that the normally-unreported contents of the Committee meeting were publicised indicates just how seriously worried the Xi regime really are. If Japan walks away from China, other nations are almost certain to follow.
Larry Kudlow, chairman of the White House’s National Economic Council, has expressed his intention to consider shouldering the relocation costs of American companies returning home from China.
In Australia, Foreign Minister Marise Payne gave an interview to the ABC over the weekend which clearly signalled the Morrison government’s stance. Payne effectively demanded a comprehensive inquiry into the Wuhan virus, coming close to outright labelling China a liar and the WHO China’s bootlicker. Payne also criticised China for reopening its wet wildlife markets. Payne concluded that, “relationships all around the world will change[…]that relationships between China and its partners, Australia and China, will be changed in some ways”.
Economic commentator Alan Kohler writes, “China is in danger of becoming a global pariah”. Alan, that ship has well and truly sailed. What remains to be seen is whether China will be able to buy and bully its way back into global favour. It’s already bending all its vast propaganda resources to doing so.
The question is, as the other Who once said, whether we “don’t get fooled again”.
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