09-18-2021, 04:17 PM
Another geopolitical trend is the impact of the Covid-19 pandemic on the CCP’s coercive diplomacy. The pandemic caused a world-wide lockdown that inhibited key forms of diplomatic and economic leverage for the CCP, particularly tourism restrictions (which included foreign students). This likely contributed to the rise in state-issued threats, of which over half of the 34 recorded cases from the last decade occurred after the CCP implemented the 23 January 2020 lockdown in Wuhan (see figure 9).
Figure 9: Cases of state-issued threats recorded before and after the Wuhan lockdown commenced
![[Image: pb36-fig9.jpg]](https://s3-ap-southeast-2.amazonaws.com/ad-aspi/2020-08/pb36-fig9.jpg)
Threats were also a timely way for the CCP to combat the rise in criticism against its handling of the outbreak. Criticisms came mainly from Western European and Anglosphere countries, but countries such as Brazil also expressed criticism and were accordingly subjected to threats of countermeasures. The increase in state-issued threats in 2020 can also be linked to the CCP’s crackdown in Hong Kong, which prompted states around the world to take positions and actions the CCP disliked at a time when they had limited options to use other forms of coercive diplomacy.
After China started easing its lockdown restrictions, another key form of diplomatic leverage became China’s exports of medical supplies. In line with the above geopolitical analysis, the CCP ‘rapidly escalated’ medical and financial relief efforts to many countries in the developing world, particularly in Africa.49 With the much-needed medical supplies as ‘carrots’, the CCP was able to offer them with the expectation that the recipient countries wouldn’t criticise the CCP’s mishandling of the outbreak. The trade in medical supplies could also be used coercively in an attempt to influence state behaviour.
For example, in April 2020, the Netherlands angered the CCP by renaming the country’s diplomatic mission in Taiwan as ‘Netherlands Office Taipei’. In response, the state-run Global Times published an article that cited ‘Chinese netizens’ who called for the export of medical supplies to the Netherlands to cease and quoted an analyst who raised this move as a means for the CCP to send a warning to the Netherlands. This also worked as a warning to other states about the CCP’s willingness to use coercive measures, even in critical areas such as health care and during a global pandemic.50
Divide-and-conquer tactics
Each of the 100 recorded cases of coercive diplomacy involved the CCP acting unilaterally against an individual country. Although the response of countries to the coercive measures wasn’t always clear, where it was possible to discern the reaction, most countries made re-establishing good relations the priority. For example, the CCP enacted multiple coercive measures against Norway in 2010 in retaliation to the awarding of the Nobel Peace Prize to Chinese dissident Liu Xiaobo. After those measures were enacted, UN voting patterns showed closer alignment between China and Norway, and the Norwegian Government supported the admission of China as an observer in the Arctic Council in 2013 and refused to meet with the Dalai Lama for the first time in 2014 (although Norway, like many other countries, may have ceased those meetings in response to China’s general growing global clout, without the fallout from the awarding of the prize).51 The CCP’s actions succeeded in influencing Norway’s foreign policy, as the concessions required to appease the party were relatively minor (the same level of success mightn’t have been achieved had the required concession been bigger).52
This type of result seems likely only to license further coercion by the CCP against others. The CCP intentionally isolates countries in this way to retain comparative strength and ensure the effectiveness of its coercive methods. The CCP’s comparative strength would be significantly diminished if countries that have been subjected to similar coercive diplomatic tactics joined forces to counter them. Remarkably, countries have so far failed to band together to counter CCP coercion, even when that’s been manifestly in their interests. This may be due to a lack of awareness of the widespread use by the CCP of coercive diplomacy, a lack of strategic analysis by foreign ministries of the best way to counter such coercion, or both.
A notable example of this failure involved Canada and Australia. Just days following the arrest of Huawei executive Meng Wanzhou in Canada pursuant to the US–Canada extradition treaty, the CCP arbitrarily arrested Canadian citizens Michael Kovrig and Michael Spavor. It took three weeks before Australia released a statement expressing its ‘concerns’ over the Canadians’ detention.53 The statement fell short of condemning the CCP’s actions and didn’t call for the immediate release of the Canadians, despite two Australian citizens having been subjected to arbitrary detention the previous year and both of them still being detained.54 Australia’s delay in issuing the statement meant that Australia and Canada (as well as the EU and US) weren’t unified in their response to the CCP’s actions and therefore had little impact.
Further analysis on the most common methods of coercive diplomacy against foreign governments
State-issued threats
In addition to the Covid-19 pandemic significantly limiting other forms of coercive diplomacy available to the CCP in 2020 (discussed above) a likely reason for the high rate of state-issued threats is because they are the quickest and most cost-effective form of coercive diplomacy and carry the lowest risk to the CCP’s interests. Our research has found these can be enough, on their own, to coerce the target state into changing course if the state places limited political value on the source of the dispute55 (although threats were not enough to change behaviour if the stakes were high enough, as the in-depth case studies on pages 18–21 illustrate).
Trade restrictions
This report recorded 19 cases of trade restrictions between 2010 and 2020, over half of which occurred since 2018. In all recorded cases, the CCP never officially implemented official sanctions against the target state; instead, an unrelated official reason was provided (such as non-compliance with sanitation or labelling requirements) or no reason was given at all. There are strong indicators for each recorded case that the CCP’s measures were designed to thinly disguise the use of trade to punish and change the behaviour of target states.
For some issues, to be effective, the target state needs to be aware that the trade measures are being levied as punishment for a given action, so, while direct causal relationships aren’t made explicit by the CCP, the trade restrictions are made in such a way as to make the connection clear to the target state. For other issues, it can be useful to maintain greater ambiguity to put the target state off balance, not knowing exactly why the restrictions are happening but only that the CCP is displeased and that concessions in some form are needed. Both approaches help the CCP maintain its official stance that coercive diplomacy is exclusively employed by the West.56 By providing an unrelated official reason to disguise coercive diplomatic measures, the CCP is able to maintain plausible deniability, which offers some protection against countries raising the issue through international channels, such as the World Trade Organization.57
The recorded cases of trade restrictions also demonstrate that the CCP is highly selective in the commodities it targets in order to send a powerful message to target states whilst minimising any harm to its own interests.58 For example, the CCP imposed restrictions on Canadian meat imports in June 2019 in retaliation against the arrest of Huawei executive Meng Wanzhou. 59 However, the CCP retracted these restrictions just 5 months later despite the tensions over this issue persisting, after the effects of a swine fever outbreak continued to drive domestic pork prices unsustainably high.60 With China’s domestic supply not being expected to recover for two or three years (especially with the risk of further outbreaks) and inflation rates nearing an 8 year high as a result,61 it was ultimately in the CCP’s interests to make this concession.62 This case illustrates some of the constraints on the CCP’s use of economic coercion.
The CCP’s recent trade restrictions against Australian barley (which are widely interpreted to be retaliation for Australia pushing for an inquiry into the origins and handling of the Covid-19 outbreak) further illustrate how these measures are often ‘aligned with—or constrained by—market trends and conditions’.63 Of all the trade restriction cases recorded, the CCP’s measures imposed on barley stand out as seemingly having the biggest effect on China’s own trade practices, as Australian barley accounted for up to 80% of China’s barley imports in recent years.64 However, this in fact aligns with the CCP’s goal of self-sufficiency and import diversification.65 Furthermore, the restrictions coincided with a significant decline in China’s domestic demand for barley.66 Though the sanctions were ‘triggered’ by Australia’s call for the Covid-19 inquiry, the CCP wanted to employ them anyway due to the benefit that would provide to the Chinese domestic market.67 As argued by Scott Waldron from the University of Queensland, it is significant that the CCP has not imposed restrictions in relation to wool, given China buys approximately 75% of Australia’s wool exports.68
The selective use of trade restrictions simultaneously minimises impacts on Chinese consumers and businesses, while maintaining leverage against the target state. Severe disruption to all trade with a target state would not only negatively affect Chinese consumers and businesses but would also exhaust all leverage against the target state in one go and completely undermine the CCP’s narrative of plausible deniability. To date, the CCP has aimed to find a balance between punishing a country enough to make it change its behaviour and running the risk of damaging relations to the point at which the state no longer sees value in appeasing the CCP or at which the Chinese economy would be damaged. As demonstrated by the case studies, the CCP selects only individual commodities or services to target with restrictions. While targeted restrictions were in place, it was common for other sectors within the same state to experience an increase in Chinese trade. This was the case in Canada in 2019; after Canadian canola imports were blocked in China, Canadian wheat exporters experienced a rise in wheat imports into China.69 Similarly, in August 2020, trade between China and Australia was 4% higher than in the previous year, despite the constraints of the Covid-19 pandemic and a deterioration in bilateral relations.70
Tourism restrictions
Tourism restrictions are the third most common form of coercive diplomacy used to target foreign governments identified through this research. This report recorded 17 cases between 2010 and 2020, half of which occurred after 2018. China is the world’s largest outbound tourism market. It accounts for more than 20% of global tourism, and 150 million Chinese tourists travelled abroad and spent a combined total of US$277 billion in 2018.71 Subject to the long-term impacts of the Covid-19 pandemic on large-scale tourism, those figures are likely to continue to increase and further grow the importance of the Chinese tourist market, as only an estimated 10% of Chinese citizens hold passports.72
The CCP holds considerable influence over its outbound tourism market,73 which it has manipulated to promote foreign policy objectives. As demonstrated in the recorded cases, the CCP controls outbound tourism through issuing travel warnings and using its regulatory powers over travel agents to direct them to avoid selling package tours to a blacklisted country. The travel restrictions necessitated by the Covid-19 pandemic have not prevented the CCP from threatening tourism restrictions or issuing travel warnings. The lack of international travel at the time these warnings were issued highlights the fact that the measures are usually not in response to the reasons claimed by the CCP and are primarily used to coerce.
Figure 9: Cases of state-issued threats recorded before and after the Wuhan lockdown commenced
Threats were also a timely way for the CCP to combat the rise in criticism against its handling of the outbreak. Criticisms came mainly from Western European and Anglosphere countries, but countries such as Brazil also expressed criticism and were accordingly subjected to threats of countermeasures. The increase in state-issued threats in 2020 can also be linked to the CCP’s crackdown in Hong Kong, which prompted states around the world to take positions and actions the CCP disliked at a time when they had limited options to use other forms of coercive diplomacy.
After China started easing its lockdown restrictions, another key form of diplomatic leverage became China’s exports of medical supplies. In line with the above geopolitical analysis, the CCP ‘rapidly escalated’ medical and financial relief efforts to many countries in the developing world, particularly in Africa.49 With the much-needed medical supplies as ‘carrots’, the CCP was able to offer them with the expectation that the recipient countries wouldn’t criticise the CCP’s mishandling of the outbreak. The trade in medical supplies could also be used coercively in an attempt to influence state behaviour.
For example, in April 2020, the Netherlands angered the CCP by renaming the country’s diplomatic mission in Taiwan as ‘Netherlands Office Taipei’. In response, the state-run Global Times published an article that cited ‘Chinese netizens’ who called for the export of medical supplies to the Netherlands to cease and quoted an analyst who raised this move as a means for the CCP to send a warning to the Netherlands. This also worked as a warning to other states about the CCP’s willingness to use coercive measures, even in critical areas such as health care and during a global pandemic.50
Divide-and-conquer tactics
Each of the 100 recorded cases of coercive diplomacy involved the CCP acting unilaterally against an individual country. Although the response of countries to the coercive measures wasn’t always clear, where it was possible to discern the reaction, most countries made re-establishing good relations the priority. For example, the CCP enacted multiple coercive measures against Norway in 2010 in retaliation to the awarding of the Nobel Peace Prize to Chinese dissident Liu Xiaobo. After those measures were enacted, UN voting patterns showed closer alignment between China and Norway, and the Norwegian Government supported the admission of China as an observer in the Arctic Council in 2013 and refused to meet with the Dalai Lama for the first time in 2014 (although Norway, like many other countries, may have ceased those meetings in response to China’s general growing global clout, without the fallout from the awarding of the prize).51 The CCP’s actions succeeded in influencing Norway’s foreign policy, as the concessions required to appease the party were relatively minor (the same level of success mightn’t have been achieved had the required concession been bigger).52
This type of result seems likely only to license further coercion by the CCP against others. The CCP intentionally isolates countries in this way to retain comparative strength and ensure the effectiveness of its coercive methods. The CCP’s comparative strength would be significantly diminished if countries that have been subjected to similar coercive diplomatic tactics joined forces to counter them. Remarkably, countries have so far failed to band together to counter CCP coercion, even when that’s been manifestly in their interests. This may be due to a lack of awareness of the widespread use by the CCP of coercive diplomacy, a lack of strategic analysis by foreign ministries of the best way to counter such coercion, or both.
A notable example of this failure involved Canada and Australia. Just days following the arrest of Huawei executive Meng Wanzhou in Canada pursuant to the US–Canada extradition treaty, the CCP arbitrarily arrested Canadian citizens Michael Kovrig and Michael Spavor. It took three weeks before Australia released a statement expressing its ‘concerns’ over the Canadians’ detention.53 The statement fell short of condemning the CCP’s actions and didn’t call for the immediate release of the Canadians, despite two Australian citizens having been subjected to arbitrary detention the previous year and both of them still being detained.54 Australia’s delay in issuing the statement meant that Australia and Canada (as well as the EU and US) weren’t unified in their response to the CCP’s actions and therefore had little impact.
Further analysis on the most common methods of coercive diplomacy against foreign governments
State-issued threats
In addition to the Covid-19 pandemic significantly limiting other forms of coercive diplomacy available to the CCP in 2020 (discussed above) a likely reason for the high rate of state-issued threats is because they are the quickest and most cost-effective form of coercive diplomacy and carry the lowest risk to the CCP’s interests. Our research has found these can be enough, on their own, to coerce the target state into changing course if the state places limited political value on the source of the dispute55 (although threats were not enough to change behaviour if the stakes were high enough, as the in-depth case studies on pages 18–21 illustrate).
Trade restrictions
This report recorded 19 cases of trade restrictions between 2010 and 2020, over half of which occurred since 2018. In all recorded cases, the CCP never officially implemented official sanctions against the target state; instead, an unrelated official reason was provided (such as non-compliance with sanitation or labelling requirements) or no reason was given at all. There are strong indicators for each recorded case that the CCP’s measures were designed to thinly disguise the use of trade to punish and change the behaviour of target states.
For some issues, to be effective, the target state needs to be aware that the trade measures are being levied as punishment for a given action, so, while direct causal relationships aren’t made explicit by the CCP, the trade restrictions are made in such a way as to make the connection clear to the target state. For other issues, it can be useful to maintain greater ambiguity to put the target state off balance, not knowing exactly why the restrictions are happening but only that the CCP is displeased and that concessions in some form are needed. Both approaches help the CCP maintain its official stance that coercive diplomacy is exclusively employed by the West.56 By providing an unrelated official reason to disguise coercive diplomatic measures, the CCP is able to maintain plausible deniability, which offers some protection against countries raising the issue through international channels, such as the World Trade Organization.57
The recorded cases of trade restrictions also demonstrate that the CCP is highly selective in the commodities it targets in order to send a powerful message to target states whilst minimising any harm to its own interests.58 For example, the CCP imposed restrictions on Canadian meat imports in June 2019 in retaliation against the arrest of Huawei executive Meng Wanzhou. 59 However, the CCP retracted these restrictions just 5 months later despite the tensions over this issue persisting, after the effects of a swine fever outbreak continued to drive domestic pork prices unsustainably high.60 With China’s domestic supply not being expected to recover for two or three years (especially with the risk of further outbreaks) and inflation rates nearing an 8 year high as a result,61 it was ultimately in the CCP’s interests to make this concession.62 This case illustrates some of the constraints on the CCP’s use of economic coercion.
The CCP’s recent trade restrictions against Australian barley (which are widely interpreted to be retaliation for Australia pushing for an inquiry into the origins and handling of the Covid-19 outbreak) further illustrate how these measures are often ‘aligned with—or constrained by—market trends and conditions’.63 Of all the trade restriction cases recorded, the CCP’s measures imposed on barley stand out as seemingly having the biggest effect on China’s own trade practices, as Australian barley accounted for up to 80% of China’s barley imports in recent years.64 However, this in fact aligns with the CCP’s goal of self-sufficiency and import diversification.65 Furthermore, the restrictions coincided with a significant decline in China’s domestic demand for barley.66 Though the sanctions were ‘triggered’ by Australia’s call for the Covid-19 inquiry, the CCP wanted to employ them anyway due to the benefit that would provide to the Chinese domestic market.67 As argued by Scott Waldron from the University of Queensland, it is significant that the CCP has not imposed restrictions in relation to wool, given China buys approximately 75% of Australia’s wool exports.68
The selective use of trade restrictions simultaneously minimises impacts on Chinese consumers and businesses, while maintaining leverage against the target state. Severe disruption to all trade with a target state would not only negatively affect Chinese consumers and businesses but would also exhaust all leverage against the target state in one go and completely undermine the CCP’s narrative of plausible deniability. To date, the CCP has aimed to find a balance between punishing a country enough to make it change its behaviour and running the risk of damaging relations to the point at which the state no longer sees value in appeasing the CCP or at which the Chinese economy would be damaged. As demonstrated by the case studies, the CCP selects only individual commodities or services to target with restrictions. While targeted restrictions were in place, it was common for other sectors within the same state to experience an increase in Chinese trade. This was the case in Canada in 2019; after Canadian canola imports were blocked in China, Canadian wheat exporters experienced a rise in wheat imports into China.69 Similarly, in August 2020, trade between China and Australia was 4% higher than in the previous year, despite the constraints of the Covid-19 pandemic and a deterioration in bilateral relations.70
Tourism restrictions
Tourism restrictions are the third most common form of coercive diplomacy used to target foreign governments identified through this research. This report recorded 17 cases between 2010 and 2020, half of which occurred after 2018. China is the world’s largest outbound tourism market. It accounts for more than 20% of global tourism, and 150 million Chinese tourists travelled abroad and spent a combined total of US$277 billion in 2018.71 Subject to the long-term impacts of the Covid-19 pandemic on large-scale tourism, those figures are likely to continue to increase and further grow the importance of the Chinese tourist market, as only an estimated 10% of Chinese citizens hold passports.72
The CCP holds considerable influence over its outbound tourism market,73 which it has manipulated to promote foreign policy objectives. As demonstrated in the recorded cases, the CCP controls outbound tourism through issuing travel warnings and using its regulatory powers over travel agents to direct them to avoid selling package tours to a blacklisted country. The travel restrictions necessitated by the Covid-19 pandemic have not prevented the CCP from threatening tourism restrictions or issuing travel warnings. The lack of international travel at the time these warnings were issued highlights the fact that the measures are usually not in response to the reasons claimed by the CCP and are primarily used to coerce.