STEVEN KUO: Opportunities headed our way as China intensifies statist bent

Just before the Group of 20 (G20) summit being held in Bali, Indonesia, Chinese President Xi Jinping — newly confirmed in his third term in office — met US President Joe Biden. It was all smiles and warm handshakes for the cameras, before the two world leaders sat down for a three hour discussion to establish red lines and avoid having vigorous competition escalate to full-blown war.

Xi has made it clear that he would prefer to de-escalate rising tensions with the US-led West. Biden, buoyed by better-than-expected midterm election results, where his Democratic party retained the Senate, even put his arm around Xi as the two leaders met in person for the first time since Biden became president.

Make no mistake, the two sides are not allies; they remain ideologically opposed. The one side is statist, Marxist-Leninist and focused on using state-owned companies as the engine to drive more equitable economic growth going forward. The other side has unshakeable faith in the free market and democracy, and does not hesitate to use its military might to enforce the liberal global order when needed.

Even so, US and Chinese economic interests are inextricably tied together, so the two sides must find a way to work together and compete in a rules-based order, for their own wellbeing as well as global peace and prosperity.

Former Australian prime minister and sinologist Kevin Rudd wrote a few weeks ago that Xi has unmistakably returned Chinese politics to Marxism. In his essay in Foreign Affairs Rudd surmised that a “Marxist-nationalist ideological framework drives Beijing’s return to party control over politics and society with contracting space for private dissent and personal freedoms”.

However, fears that China will be returning to the chaotic days of the Cultural Revolution are overblown. Christopher Johnson, senior fellow at the Asia Society argues that we should “expect Beijing to continue to govern in a stable and predictable manner, if only because China is facing major challenges that make the politburo crave stability”.   

The two sides can agree to disagree. Neither side can force the other to change, and both believe the other is to blame when tensions escalate, but as the world’s two superpowers they know they have no choice but to work together on regional and global issues.

The list of issues is long. There is global warming, a rare instance where the two sides tend to be on the same page. Differences of opinion range from the war in Ukraine to tensions in the South China Sea and over Taiwan and the Korean Peninsula. On these issues there will probably be no solution as China rises and determinedly pushes back against the US’s dominance in the Asia-Pacific region.

As the global press swoon over the Xi-Biden meeting and commentators like myself subject readers to death by analysis, our own President Cyril Ramaphosa has found time away from ranching and begun to lobby for Africa as a continent to join the G20. I think this is a brilliant idea and applaud him for starting the process.

There is a precedent. The EU is a member, along with France, Germany and Italy. Up to now SA has presented itself, to varying degrees of success, as the spokesperson for African issues and the champion of the African agenda. There is little doubt that if African countries can unite and work together on a single agenda the continent could be the next superpower.

The China we need to work with going forward will be even more dominated by state-owned companies than in the past. That means there will be more Chinese private enterprises that are squeezed out of the domestic market and come looking for African partners to explore African markets. There will therefore be plenty of opportunities for SA businesses that are prepared to put in the time and keep an open mind.

• Dr Kuo, a former lecturer at the Shanghai International Studies University in China, is adjunct senior lecturer in the University of Cape Town’s Graduate School of Business.