Event Review: David Shambaugh on “China Goes Global” at American University 9/25/2012

David Shambaugh is a professor of international affairs at George Washington University and has written many books on the politics of China. He recently gave a talk at American University about his upcoming book. The probable title for the book is China Goes Global. However, as another professor pointed out at the end of the talk, its more appropriate name is China is Not Going Global. Shambaugh beings by defining China as a rising power. Yes, he says, China has the 2^nd largest economy, 2^nd largest military budget, 2^nd largest navy, and the largest number of PhD graduates in the world. Yes, China is rising as a power. However Shambaugh then argues that, no, China is not an expanding power. China may be rising vertically but it is not spreading out horizontally. Yes, China has a global presence; but China does not have global power because it is not influencing events in other countries. He argues that wealth does not equal power. China must first convert its wealth into instruments of power and use this power in order to have influence over the world. Shambaugh points to four fields that China lacks global influence in: diplomacy, economics, military, and politics.

In diplomacy, China takes the safest, least controversial position. Beijing’s goal is to keep the status quo and get along with everyone. Shambaugh says that many times China takes a classic realist, selfish policy that restricts its involvement in other states. He points to China’s need of a stronger domestic situation before it can focus on its international involvement. In 2011 a Chinese scholar aptly stated, “China cannot even manage itself- how can it manage others?” Along the lines of the realist approach, China is deeply distrusting of other countries. As the Carter Centers Democracy Program points out, some Chinese diplomats believe that the US is trying to shape and evolve China. Among these efforts, US has tried to get China into our wars to impede China’s rising power. However, Shambaugh points out that Chinese diplomats have a variety of views of Chinese diplomacy. He divided these view into seven different categories: nativists, realists, major powers focus, Asia first, global south focus, selective multilateralists, and globalists. As Shambaugh correctly puts, China is having an identity crisis.

China’s economic policies are still very much domestic and contained as well. Though China’s largest trading partner is the US, its next top four trading partners are Japan, Hong Kong, South Korea, and Taiwan. With the exception of the US, China is mainly trading with other Asian states. Also, China has yet to become a true capitalist society because the state still has huge control over many corporations. Though China has the 2^nd largest economy in the world, it is the 5^th largest investor abroad, investing roughly $60 billion in 2011. The top four countries China invests in are Hong Kong, the British Virgin Islands, the Grand Cayman Islands, and Luxemburg. These are all tax haven locations where China can pack its money away in safe accounts. As far as Chinese multinational corporations, there are barely any that have a big market presence. In the talk, Shambaugh asked the audience to shout out any Chinese multinational corporations that came to mind, and most people could only think of Air China. China has 61 companies on the Global Fortune 500 lists, but they only have 1 on the Business Week top 100 Brand list. They are not marketing their big money companies. Further, most companies on the Fortune 500 list obtains the majority of their revenue from China’s domestic market. The big fault of China’s multinational corporations is their lack of foreign management and lack of transparency. China is not expanding their economic influence to the rest of the world.

China has also been working on building up its soft and hard power, yet Shambaugh understands that China has a far ways to go before it can truly use these powers to influence others. In the 2011 BBC poll about state images, 44% of the global public see China’s image as positive while 38% see it as negative. Hu Jintao is starting to understand that comprehensive power includes soft power, not just money and military power. He just poured money into global propaganda work, such as China Daily, CCTV, and CRI. However, if China really wants to change its global image and gain moral authority, Shambaugh asks why China is still keeping Liu Xiaobo in solitary confinement. He argues that soft power starts at home. Soft power does not come from the government, it comes from society. If this is true, China has a long way to go before it has soft power that it can use to influence the world. As for hard power, Shambaugh states that China still has very partial and weak military influence. China is strong in its ballistic missiles and cyber capabilities. However, they still focus on conventional military power. He argues that China is a regional military power at best. It cannot project and sustain nautical and navy power out of its region. Out of 70 navy ships, only 6 are blue water capable. Shambaugh closed up his talk by reinstating the point that China is a global actor, not a global power.