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China Is Weaponizing Globalization

The Chinese Communist Party has turned global ties into its own tools.

An outdoor screen shows live coverage of Chinese President Xi Jinping attending the closing session of the National People’s Congress in Beijing on May 28.WANG ZHAO/AFP VIA GETTY IMAGES

The COVID-19 pandemic has triggered calls in many countries for a reexamination of their relationship with China. In places like Australia and the Czech Republic, these calls have built on preexisting doubt, emerging from the realization that actors linked to the Chinese Communist Party (CCP) may be interfering with democratic political processes in “covert, coercive, or corrupting” ways. In a recent report for the German Marshall Fund’s Alliance for Securing Democracy, I examined what makes this interference distinct from other authoritarian actors like Russia. The report finds that the party’s interference in democratic countries is characterized by five mutually reinforcing factors:

  • weaponization of China’s economy,
  • attempts to dominate the global conversation about China,
  • a reliance on elite intermediaries,
  • targeting the Chinese diaspora, and
  • a tendency to embed authoritarian norms

Each of these characteristics draws its potency from one key strategy: the CCP’s repurposing of globalization as an engine meant to power—and win global consent for—the party’s progress toward “the center of the global stage.” The party has identified globalization’s interconnectedness as a key driver of its rise: The need for China to continue deepening its connections to the rest of the world through trade and technological exchange is one of the most consistent themes of its leaders’ speeches and writings.

The United States’ rise was driven by many of the same forces, and for many years, it and other countries encouraged China’s integration with the rest of the world in the hope that the CCP would become a “responsible stakeholder” within the international community. In this framework, the party’s embrace of globalization was treated as evidence of its desire to reform and become “more like us.” To be sure, there is nothing inherently concerning about a rising power seeking to carve out space for itself in the global political order nor about it using globalization’s economic, technological, and political interconnectedness to do so. But this has not happened, nor was it ever—on the party’s side—intended to. Rather, as its wealth and strength have grown, the party’s exercise of power abroad has increasingly come to resemble the structure of inducements and coercion it uses to get its way at home. This is what should concern us: that as the party sheds its inhibitions on the coercive use of power abroad, it simultaneously wants to become more connected with the rest of the world through trade and finance.

Xi Jinping and other top CCP leaders know that national renewal and global leadership—what they call the “great rejuvenation of the Chinese race”—are not inevitable. Sustaining China’s progress toward these goals will require the party to continue to “unite our friends and isolate and attack our enemies”—to cite Deng Xiaoping’s memorable description of how the CCP holds power domestically. This mindset of rewarding friends and attacking enemies plays out in the context of an increasingly globalized party: Its “friends” and “enemies” are not only its allies and opponents at the national level but organizations, businesses, and institutions from the grassroots on up. And the friends the party has cultivated domestically now have increasingly global footprints. The party believes that deepening economic integration with the rest of the world will lend added potency to the already powerful set of tools it uses to reward friends—and attack enemies—in other countries. Understanding these tools therefore helps us define the contours of what a CCP-led version of globalization might look like, one where other countries’ well-being and freedom of action depend more than ever before on their deference to Beijing’s continued rise.

A worker removes a promotional banner for the NBA from a building in Shanghai on Oct. 9, 2019, following a tweet by the Houston Rockets general manager supporting pro-democracy protests in Hong Kong.

A worker removes a promotional banner for the NBA from a building in Shanghai on Oct. 9, 2019, following a tweet by the Houston Rockets general manager supporting pro-democracy protests in Hong Kong. HECTOR RETAMAL/AFP VIA GETTY IMAGES

Weaponizing China’s economy

None of the ways the party shapes other countries’ politics would be possible without China’s central place in global flows of goods and services. Money is its most powerful tool to win and reward compliance. Researchers from the Lowy Institute found that in 2001, more than 80 percent of countries had a larger volume of trade with the United States than with China. But by 2018, that figure had shrunk to barely 30 percent, with two-thirds of countries trading more with China than with the United States. 2001 was the year China joined the World Trade Organization, one of the key international organizations driving economic globalization.

The party moved to weaponize its growing trade relationships with surprising rapidity. In 2010, after a Norwegian committee awarded the Nobel Peace Prize to an advocate of constitutional government inside China, the party cut off imports of Norwegian salmon for seven years. The incident was notable in part because the Nobel committee that made the decision is not a government body—Norwegian governments and businesses were punished for something they did not control. This form of collective punishment is a common feature of the party’s attacks on its so-called enemies and is designed to encourage collective self-censorship. Since then, countries and companies that have contravened the party’s line have routinely found themselves on the wrong end of such tactics.

In October 2019, for example, Houston Rockets general manager Daryl Morey retweeted a single tweet expressing support for Hong Kong’s pro-democracy protest movement. The resulting firestorm put the NBA’s business in China on edge: NBA games were dropped from state television, NBA merchandise was taken down from online stores, and the Chinese government reportedly demanded that the league fire Morey. Even though the furor has since died down, NBA commissioner Adam Silver estimated the economic damage to the league in the hundreds of millions of dollars.

Although—following heavy criticism from U.S. politicians—the NBA defended Morey’s right to free speech, China’s message still appears to have been received. Since the controversy, no NBA players, owners, or officials have made any public statements in support of Hong Kong protesters. As in many other such incidents, the party paid a short-term public relations cost for its coercive tactics but appears to have successfully communicated to a powerful target the long-term costs of political noncompliance. Governments and companies around the world now know that if they step too far out of line, the CCP will hit them where it hurts: their bottom line. Silence and deference, on the other hand, will be rewarded.

A girl wearing Mickey Mouse ears watches the opening ceremony of the Shanghai Disney Resort on June 16, 2016. In 1997 after U.S. studios released three major films that painted the Chinese Communist Party in an unflattering light, the party threatened to pull out of its planned Disney theme park.

A girl wearing Mickey Mouse ears watches the opening ceremony of the Shanghai Disney Resort on June 16, 2016. In 1997, after U.S. studios released three major films that painted the Chinese Communist Party in an unflattering light, the party threatened to pull out of its planned Disney theme park. JOHANNES EISELE/AFP VIA GETTY IMAGES

Attempting to dominate the global conversation about China

More often than not, when the CCP weaponizes economic connectivity, it is to punish—or reward—a target for speaking about China in a particular way. As at home, the party’s goal abroad is to erase or downplay information that could shine an unflattering light on its activities while putting forth an image of China as a benign partner for international cooperation. Xi calls this process “bringing together foreign and Chinese” and describes it as a process of actively converging foreign perspectives on China with those of the party. This convergence matters, because a world where narratives about China reflect the party’s preferences is, more than likely, one where there is less active resistance to the party’s goals. As one FBI official recently put it when describing CCP outreach to local governments, “perception adds up and creates a policy environment.”

Among countless examples globally of this process of “bringing together,” one that stands out is Hollywood. In 1997, U.S. studios released three major films that painted the party in an unflattering light, among them Seven Years in Tibet. The CCP halted domestic distribution of all films by the offending studios and communicated that further such films would endanger the companies’ business in China, including a planned Disney theme park in Shanghai. After bringing in Henry Kissinger to help smooth things over, Disney would eventually get its theme park, but since that year no major American studio film has portrayed China negatively. Films such as the remake of Red Dawn have been rewritten to posit other countries, such as North Korea, as a potential enemy instead of Beijing. Indeed, many, such as The MartianIndependence Day: Resurgence, and Gravity, have taken pains to put China in a positive light.

By threatening a key pillar of American studios’ global business (Avengers: Endgame made about a quarter of its $2.8 billion global box office in China), the party has managed to deny visibility to adversarial narratives while piggybacking on U.S. soft power to transmit the image of China as a benign advocate of international cooperation. Such an achievement would have been the envy of Soviet leaders during the Cold War. Indeed, when contrasted with Cold War-era portrayals of the USSR in films such as The Hunt for Red OctoberRed Dawn, and Rocky IV, the potency of the CCP’s approach—one rooted in its deep connections to global flows of goods and services—becomes particularly clear.

An employee works at a Huawei mobile phone production line during a media tour in Dongguan, China, on March 6, 2019. Chinese telecom giant Huawei gave foreign media a peek into its state-of-the-art facilities as the normally secretive company stepped up a counteroffensive against U.S. warnings that it could be used by Beijing for espionage and sabotage.

An employee works at a Huawei mobile phone production line during a media tour in Dongguan, China, on March 6, 2019. The Chinese telecommunications giant Huawei gave foreign media a peek into its state-of-the-art facilities as the normally secretive company stepped up a counteroffensive against U.S. warnings that it could be used by Beijing for espionage and sabotage. WANG ZHAO/AFP VIA GETTY IMAGES

Relying on elite intermediaries

The CCP maintains one-party rule over 1.3 billion people by cultivating, co-opting, and coercing non-party elites, a process it calls the “patriotic United Front.” Many analysts who study the party’s authoritarian control tend to focus on its coercive security and censorship apparatus and not on how it rewards its partners in power. In the party’s parlance, these “friends” or “old friends” are non-party elites who abide by its political leadership, while “enemies” are those who challenge the party’s right to rule. By uniting its friends, the party seeks to splinter its enemies and force potential enemies within target elite groups to reconsider the costs of resistance.

This matters for other countries. The elites specifically targeted by the party for cultivation and co-option include leading private corporations, businesspeople, intellectuals, and academics. The party’s embrace of globalization has given all of these friends a growing global role; several such individuals have interfered in the politics of countries like Australia and New Zealand in ways that appear to benefit Beijing.

None of these intermediaries more clearly demonstrates the advantages of the CCP’s globalized approach than the Chinese telecommunications firm Huawei. In less than 20 years, Huawei’s close relationship with the party has helped it grow into the world’s largest provider of 4G and 5G network backbone equipment, the second-largest seller of smartphones, and an active participant in global standards-setting bodies. The company’s nominally private status means it can shape democratic countries’ information spaces in ways that align with party messaging but would be difficult for the party to do itself, using tools of corporate thought leadership such as lobbying, direct advertising, and advocacy campaigns. Huawei’s presence abroad also has a darker side: It has been credibly accused of assisting with Chinese intelligence work in Europe and Africa and of helping democratically elected African governments spy on political opponents.

The party also rewards friendly foreign elites. Important foreign businesspeople and politicians can find that their advocacy of deepened commercial ties with China is rewarded with substantial business opportunities or lucrative positions on the boards of Chinese companies. (Examples are numerous.) In doing so, the party is able to outsource advocacy, relying on respected, credible voices in other societies to call for deepening economic cooperation despite the CCP’s obvious authoritarian tendencies. Other autocracies, like Russia, have similar tools. But they are arguably not as effective as China’s, owing to the simple gravity exerted by the financial opportunities the CCP can offer.

Australian Labor Party Sen. Sam Dastyari apologizes in Sydney on Sept. 6, 2016, after asking a company with links to the Chinese government to pay a bill incurred by his office.

Australian Labor Party Sen. Sam Dastyari apologizes in Sydney on Sept. 6, 2016, after asking a company with links to the Chinese government to pay a bill incurred by his office. WILLIAM WEST/AFP VIA GETTY IMAGES

Targeting the Chinese diaspora

Since opening to the outside world in 1978, the CCP has tried its utmost to take advantage of the global Chinese diaspora, using the same familiar practice of rewarding friends and punishing enemies it practices at home. These policies emerge from a race-centric worldview that evinces little appreciation for preexisting national loyalties and little regard for its potential impact on the societal cohesion of other countries. A Chinese general typified this mindset when he commented to a member of the U.S. armed forces of Chinese descent that “blood is thicker than water. Chinese blood runs through you. You understand us, and know that no matter what flag you wear on your shoulders, you are Chinese first and foremost.”

The party’s appeal to racial solidarity is undergirded by a cold calculation of the usefulness of a globally connected diaspora. One senior official charged with diaspora outreach wrote that “the real point of ‘diaspora ties’ isn’t in the ‘ties’ themselves but in the enormous use that can be made of these kind of ‘ties.’ … The use of [overseas Chinese] lies in the advantages of all of their funds, technology, and human resources. Some are very well connected in their home countries and have strong commercial networks locally, regionally, and even globally.”

The party’s one-size-fits-all determination to exploit a globalized diaspora flattens the incredible complexity of this community, many of whose families have lived outside China for generations and feel no loyalty to an authoritarian Communist regime. Through policies that actively attempt to encourage dual loyalties, the party also places at even greater risk a vulnerable population, one that must cope daily with the consequences of anti-Asian racism in the communities where they live and work.

Defending that population from the party’s coercion should be a key goal of democratic states. Obvious attempts by the CCP to use wealthy Chinese émigrés to inappropriately influence politics in countries like Australia and New Zealand have produced responses by democratic governments wishing to protect their sovereignty. But poorly handled responses can inspire ugly racism and further alienate democratic countries’ Asian populations. There is to date no indication that top CCP leaders appreciate this dynamic nor that they care what effect their targeting the Chinese diaspora has on other societies.

Malaysia’s former prime minister Najib Razak (center) leaves a court in Kuala Lumpur on April 3, 2019, while on trial for alleged involvement in the looting of the 1MDB sovereign wealth fund.

Former Malaysian Prime Minister Najib Razak (center) leaves a court in Kuala Lumpur on April 3, 2019, while on trial for alleged involvement in the looting of the 1MDB sovereign wealth fund. MOHD RASFAN/AFP VIA GETTY IMAGES

Embedding authoritarian norms

Whether and to what extent the party intends to refashion global norms to make the world “safe for autocracy” is hotly debated in the analytical community. It may well be that the party itself does not know. (America in 1901 certainly had no plan for the liberal global order that it would help usher into existence less than half a century later.) However, it is beyond dispute that the increasing presence of the party and its proxies in globalized flows of goods, services, and capital is encouraging elites in other countries to behave in ways that are recognizably authoritarian.

Perhaps better than any other to date, one case illustrates the planet-sized stage on which these tendencies now play out, aided by the party’s direct command of some of the world’s largest financial institutions. In early 2019, the Wall Street Journal reported on Xi’s 2016 approval of a complex, corrupt offer to Malaysia’s government. On Xi’s behalf, senior Chinese officials proposed that Chinese banks would provide billions of dollars in funding to bail out Malaysia’s corrupt 1MDB sovereign wealth fund, which was dragging down the electoral prospects of then-Malaysian Prime Minister Najib Razak.

China also offered the Razak government the fruits of its “full operational surveillance” of the Hong Kong-based Wall Street Journal reporters who had broken many of the 1MDB stories so that the Malaysian government could identify and nullify the Journal’s sources. In return for this assistance, the Malaysian government would sign on to tens of billions of dollars’ worth of Belt and Road infrastructure projects with “above market profitability” for Chinese contractors. Although these efforts were disrupted by the unexpected victory of a democratic alliance in the Malaysian elections, and the subsequent prosecution of Razak and others, the scale and bald-faced nature of the proposed deal make clear the attraction of CCP-style globalization to would-be autocrats around the world.

Even in instances where the party is not directly involved, its contempt for civil liberties means that China-based companies have little reason to worry whether their actions encourage another government’s authoritarian behavior. In Ecuador, for example, officials contracted with the Chinese state-owned surveillance technology supplier Hikvision to build a countrywide video surveillance system that was used to track and intimidate political opponents. In Venezuela, officials reportedly asked ZTE—another state-owned technology company—to build a comprehensive national database of its citizens. Citizens’ information was then tied to an electronic identification card used to deny political dissidents access to public services.

A sign advertising 5G mobile telecommunication is pictured in a shop in London on Jan. 28. The U.K. government recently proposed a club of 10 democracies that would develop alternatives to Huawei 5G.

A sign advertising 5G mobile telecommunications is pictured in a shop in London on Jan. 28. The U.K. government recently proposed a club of 10 democracies that would develop alternatives to Huawei 5G. JUSTIN TALLIS/AFP VIA GETTY IMAGES

Globalization with party characteristics

The cases cited above are a small slice of a rapidly expanding universe of concerning overseas behavior by the Chinese party-state or its proxies. They point to a series of conclusions that the United States and other democratic countries should consider when formulating their shared policy toward China, now and in the years to come:

  • First, the CCP views its globalization and its rise as intimately linked—a party-led order will be a global one.
  • Second, the party believes that this order need not be a liberal one.
  • Third, the tools the party uses to win international consent for its rise closely resemble those it uses to hold power at home. Because the party believes its success derives from its past ability to wield these tools, its use of them is unlikely to change in the future.
  • Fourth, backstage maneuvering and the means of raw national power will play a more important role in a Chinese-led global order than they do now. Machiavellian power politics have their place in a U.S.-led order, but the United States has historically also been willing to bind its power within a set of transparent, agreed-on rules for mediating disputes. (Indeed, the animating philosophy of the current U.S. president is most succinctly summarized as an outright rejection of this willingness to play by the rules.) The party is likely to be bound to such rules only to the extent that other states can force its compliance.

This combination of factors is one reason why some within the current U.S. administration have pushed hard for economic decoupling from the Chinese economy, in an effort to deny the party the sway in other countries’ political systems that comes along with growing economic might. Decoupling remains hugely controversial and would undoubtedly be hugely costly, if executed as envisioned by the more hawkish elements of the administration. The administration has also had difficulty signing up allies for its vision, in part because the transnational cooperation it would require has been undermined by the administration’s mercantilist jawboning of many of those very same allies in other trade negotiations.

But those pushing for decoupling live in a more realistic world than those who would advocate a return to the status quo ante, in that they at least attempt to grapple with the geopolitical implications of an authoritarian party intent on using globalization to power its continued rise. Policymakers across the democratic world who want to secure the blessings of liberty and the benefits of global economic integration need to start working together to offer a middle way. The U.K. government’s recent proposal for a club of 10 democracies that would develop alternatives to Huawei 5G is a promising start. But even those measures don’t begin to embrace the depth of the challenge Beijing poses. To defend the best parts of the system we call globalization — the parts that uphold human dignity by enabling humanity’s capacity for creativity and collaboration to flower — democratic countries will have to band together in a cooperative effort that cuts across government, business, academia, science, and technology. The sooner that this shared project can begin, the better.

Matt Schrader is a researcher on Capitol Hill and author of the recent study “Friends and Enemies: A Framework for Understanding Chinese Political Interference in Democratic Countries.” This piece provides his personal views and does not necessarily reflect those of any congressional member or office.


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