Policy Roundup: October 2023
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Prospects for China’s Growth and Foreign Relations in an Era of Competition: 2nd Annual Big Data China Conference
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Big Data China 2nd Annual Conference (Virtual)
Prospects for China’s Growth and Foreign Relations in an Era of Competition
The event will be broadcast live from this webpage.
Tune in on December 5th to watch our annual conference! China experts in the policy and academic communities will discuss the state of the Chinese economy, pathways to manage scholarly exchanges, and the future of Chinese foreign policy.
AGENDA
8:00 - 8:30 am: Keynote Speech: Kevin Stein, Chair, American Chamber of Commerce in Shanghai, and Co-Chair, China Public Policy Practice, Covington & Burling
8:45 - 9:45 am: Panel 1: Scenarios for Chinese Growth Over the Next Decade: Key Factors and Implications
Moderator: Scott Kennedy, CSIS
Panelists:
Zhiguo He, University of Chicago Booth School of Business
Bert Hofman, NUS Lee Kuan Yew School of Public Policy
Zongyuan Zoe Liu, Council on Foreign Relations
10:00 - 11:00 am: Panel 2: Charting a Path for Scholarly Exchange in an Era of Strategic Competition
Moderator: Scott Rozelle, Stanford Center on China’s Economy and Institutions
Panelists:
Li Chenjian, Stanford University
Molly Roberts, UC San Diego
Deborah Seligsohn, Villanova University
11:15 - 12:15 pm: Panel 3: Between Backlash and Balancing: The State of China’s Foreign Relations
Moderator: Ilaria Mazzocco, CSIS
Panelists:
Yunnan Chen, Overseas Development Institute
Carla Freeman, United States Institute of Peace
Francesca Ghiretti, Adarga Research Institute
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Conferences
How the U.S. Should Adjust Its Defense Budget to Address China's Military Modernization
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Today’s geopolitical climate has created new and dangerous challenges for America’s defense and the support of democracy and freedom worldwide. These challenges demand a reexamination of the U.S. defense budget to ensure that America’s forces retain the capabilities to defend the nation and deter aggression abroad. The expert authors of the new volume Defense Budgeting for a Safer World (Hoover Institution Press) review the significant areas of debate in the U.S. defense budget and provide recommendations for aligning it with new global realities. Chief among these new realities are China’s modernized military and the nation’s objectives in the South China Sea and for reunification with Taiwan, testing U.S. dominance in the world order and raising questions about allies’ security and the U.S. ability to counter threats from the People’s Liberation Army.
In her contribution to the new volume, in a chapter titled “The Military Challenge of the People’s Republic of China,” Center Fellow Oriana Skylar Mastro reviews the last quarter-century of developments in China’s strategy for reunification with Taiwan. Mastro explains that the original shape of that strategy, strengthening ties with Taiwan to persuade the population, “has failed” and now takes the form of belligerent air and sea incursions, increasingly sophisticated military exercises, and official Chinese rhetoric about the inevitability of reunification and the impossibility of Taiwan’s independence has intensified.
China’s military modernization has focused on the ability to prevent a decisive U.S. response, referred to as its anti-access/area denial (A2/AD) strategy.
Oriana Skylar Mastro
Center Fellow
Mastro notes that “China’s military modernization has focused on the ability to prevent a decisive U.S. response, referred to as its anti-access/area denial (A2/AD) strategy." The United States, as a non-resident power in the Asia-Pacific, depends on its aircraft carriers to project power in the South China Sea, but these carriers are vulnerable to Chinese ballistic systems. Because it will likely have to operate outside the first island chain — that is, the “barrier” extending from Japan, past Taiwan and the Philippines, to maritime and peninsular Southeast Asia — the U.S. military depends on “enablers” to accomplish its missions, like aerial refueling and satellites for cyber capabilities. These assets are likewise vulnerable to Chinese disruption/attack, as are U.S. forward bases in Asia, such as Okinawa.
Mastro’s recommendations to mitigate current U.S. weaknesses to a Chinese invasion of Taiwan include "more access, basing, and overflight," "more mass on targets," and "leveraging partners." While Chinese military power has not surpassed that of the United States, Mastro warns that if U.S. deterrence is not maintained and improved, Chinese leadership may become confident enough to move against Taiwan, resulting in a war with the United States. On the other hand, she assesses that the needed deterrence is possible if the proper steps are taken now.
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With contributions from military, government, and academic experts, a new volume explores what changes will be necessary in the U.S. military budget to keep the nation secure in a new geopolitical environment. A chapter by Center Fellow Oriana Skylar Mastro focuses on how to update military spending to enhance U.S. capability to deter Chinese ambitions in Taiwan and beyond.
Scott Rozelle Joins the US-China Salon Podcast to Share Insights on China's Rural Development
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In this podcast Scott Rozelle Rozelle provides invaluable perspective on key topics impacting rural communities. It explores recent education reforms in China, including efforts to strengthen rural schooling and early childhood learning. And also delves into pressing employment challenges as many rural workers lack the skills to transition from manufacturing jobs to the service sector. Professor Rozelle emphasizes the urgency of implementing job retraining programs and safety nets. Looking ahead, overcoming rural-urban inequality will be critical for China to avoid the “middle income trap” that ensnares many developing nations.
The Military Challenge of the People’s Republic of China
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The authors of Defense Budgeting for a Safer World review the significant areas of debate in the U.S. defense budget and provide their expert suggestions for aligning it with new global realities.
One of those new realities is a modernized Chinese military with dramatically increased funding. It raises questions with U.S. allies about their own security and the U.S. ability to counter threats from the People’s Liberation Army, including the possibility of forced reunification with Taiwan.
In chapter 2 of the book, “The Military Challenge of the People’s Republic of China,” Oriana Skylar Mastro focuses on this threat. She first reviews the last quarter-century of developments in China’s strategy for reunification with Taiwan. This plan has evolved from strengthening ties to belligerent air and sea incursions and increasingly sophisticated military exercises. At the same time, Xi Jinping has stepped up rhetoric about the inevitability of reunification and the unacceptability of an independent Taiwan.
The United States has significant weaknesses in the face of a Chinese anti-access/area denial strategy, primarily due to the United States not being a resident power in the Asia-Pacific but also the vulnerability of U.S. aircraft carriers to Chinese ballistic systems. Because it will likely have to operate outside the first island chain, the U.S. military depends on “enablers” to accomplish its missions, like aerial refueling and satellites for cyber capabilities. These assets are vulnerable to Chinese disruption/attack.
Mastro’s recommendations to mitigate current U.S. weaknesses to a Chinese invasion of Taiwan include expanding the number of agreements to base in countries around the Asia-Pacific, increasing stockpiles of munitions effective against naval vessels, and strengthening partnerships and allies in the region.
While Chinese military power has not surpassed that of the United States, Mastro warns that if U.S. deterrence is not maintained and improved, Chinese leadership may become confident enough to move against Taiwan, resulting in a war with the United States.
Related Research
Learn more about Dr. Mastro's research on the U.S.-China great power competition.
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A chapter in Defense Budgeting for a Safer World: The Experts Speak, edited by Michael J. Boskin, John Rader, and Kiran Sridhar.
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Hoover Institution Press
Book Publisher External URL
Shorenstein APARC 2022–23 Annual Report
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Shorenstein APARC's annual report for the academic year 2022-23 is now available.
Learn about the research, publications, and events produced by the Center and its programs over the last academic year. Read the feature sections, which look at Shorenstein APARC's 40th-anniversary celebration and its conference series examining the shape of Asia in 2030; learn about the research our postdoctoral fellows engaged in; and catch up on the Center's policy work, education initiatives, publications, and policy outreach. Download your copy or read below:
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Common Prosperity Should Start Early
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Read the original story published by China Daily or The China Story
According to World Bank data, only a handful of economies have risen from middle- to high-income status since 1960, when economic catch-up growth took off in many developing economies. Examples include the Republic of Korea, Singapore, Israel and Ireland. Some countries that were high income in 1960, such as Canada and France, remain so today. Some that were poor, such as Cambodia and Tanzania, have stayed poor. And then there are many countries that have maintained their middle-income status for decades, seemingly unable to reach high-income status. They are in what is called the middle-income trap.
One key factor that may account for disparate development paths among nations is education. Having a large supply of educated workers ensures that enough talent exists to meet and drive demand for high-value goods and services that drive an economy when it becomes a high-income one, thereby sustaining growth. When too many unskilled workers are squeezed out of upgraded industries, their wages tend to stagnate or fall, curtailing demand and hampering growth. According to the Organization for Economic Cooperation and Development, in countries that graduated to high-income status, 72 percent of the working age population (18-65 years) had completed secondary education when the country was still in the middle-income status. In countries that are stuck in the middle-income trap, the share of the working-age population with a secondary education was much lower — only 36 percent on average.
How does China compare to countries in the middle-income trap? Since the beginning of the opening-up and reform in 1978, China has undergone remarkable development. After four decades of strong economic growth, even with double-digit growth rates, China has become the second-largest economy (in terms of nominal GDP), the largest exporter, and the second-largest importer in the world. However, China's growth has relied heavily on unskilled labor. For all of its investment in physical infrastructure, for decades China failed to invest enough in the education and health of a large share of its people.
Education attainment metrics help reveal China's potential future development and growth trajectory. According to China's 2015 micro-census data, about 450 to 500 million people in China between the ages of 18 and 65, which is 70 percent of the labor force, have never attended even one day of high school.
A large population of uneducated workers was not a problem while China was moving from low- to middle-income status. Unskilled labor was in high demand. Unskilled wages were low and low-cost manufacturing and construction sectors were on the upswing. But China's growth model has been changing over the past decade or more. Unskilled wages are growing higher, so foreign investors have begun shifting their attention toward other countries with cheaper labor. China's own massive push to automate is also rendering low-skilled workers redundant.
Recognizing the critical need for widespread education, the Chinese government expanded access to high school throughout the country in the mid-2000s. High school attainment among the youngest cohorts in the labor force is close to 80 percent. But hundreds of millions of less educated people will remain in the labor force for the next 30 years. The government will face huge challenges trying to either retrain workers or provide a social safety net.
The quality of China's expanded secondary school education is also uncertain. Most low-skilled labor comes from rural areas, where school and health systems are under-resourced due to the legacy of national policies. Historically, a higher share of public investments in infrastructure and services has been channel-led toward urban areas.
Systemic shortfalls in the education and health of young children in rural areas may also render many young people unprepared to learn complex skills as they age. In large-scale field studies conducted by research groups in rural primary schools across rural areas of Central and Western China over the past decade, more than a quarter of school children were found to be anemic; one out of five was myopic (and did not have eyeglasses); and one out of four had intestinal worms threatening their nutritional status and cognitive development. These education and health gaps have been found to open up even earlier, before children enter primary school. Rural children start lagging behind in their development during the first years of life. A systematic review and meta-analysis calculated in 2021 that the risk of delay in early cognitive development and language function amounts to 45 percent before age 5 in rural study sites across China.
Parenting programs focusing on cognitive stimulation during early childhood are a promising tool to tackle root causes of educational and health inequities in resource-poor settings. Studies have shown that parenting programs can benefit child development in developing regions such as rural China in the short run, as well as a range of adult outcomes in the longer run, including lifetime educational attainment. Therefore, policymakers no longer debate the effectiveness of such programs, only how such quality programs can be delivered cost-effectively, sustainably, and at scale.
The Chinese government has announced its intention to steer China on a path toward common prosperity. China eradicated extreme poverty in 2020. However, 600 million Chinese had a monthly per capita income of $140 or less in 2020. In the face of these remaining challenges, China's central leadership promotes the phrase "common prosperity "since 2021. This signals an intent to curtail income inequality and excessive wealth accumulation by individuals, while helping people to achieve a better standard of living. Certainly, the poverty alleviation efforts over the past several years have raised standards of living. In addition, "rural vitalization" plans have so far focused on diversifying the incomes of rural residents. Innovation in the digital space has also been a key ingredient to enable farmers to sell their products online. These policies all have benefited rural China and led to overall reductions in inequality. However, a very real rural-urban gap in human capital remains. Investing in the developmental opportunities of disadvantaged children can play an important role in further improving social mobility and building the large, high-skilled labor force China will need to support a strong, innovation-driven economy in the future.
The risks of a stagnating China would reverberate far beyond its shores. China's sheer size — one-fifth of the world's population — means what happens there will have outsized implications for foreign trade, global supply chains, financial markets and growth around the world. No assessment of China's growth is complete without considering the implications of China having hundreds of millions of underemployed people in its economy for the foreseeable future.
Dorien Emmers is an assistant professor at the Chinese Studies Group and the Department of Economics of KU Leuven. Scott Rozelle is the Helen F. Farnsworth senior fellow and the co-director of the Rural Education Action Program in the Freeman Spogli Institute for International Studies at Stanford University and a recipient of the Friendship Award of the Chinese Government. The authors contributed this article to China Watch, a think tank powered by China Daily.The views do not necessarily reflect those of China Daily.
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Dorien Emmers, former SCCEI Postdoc, and Scott Rozelle, SCCEI Co-Director, wrote a piece featured in China Daily and The China Story highlighting the challenges of inequality and a possible path towards common prosperity.
Special Lecture with Professor Hui Qin: Misalignment in the Exchange of Ideas between China and the West
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A Special Lecture with Professor Hui Qin
中西思想交流中的"问题错位"
Misalignment in the Exchange of Ideas between China and the West
Tuesday, November 7, 2023 | 3:00 pm - 5:00 pm Pacific Time
William J. Perry Room C231, Encina Hall Central, 616 Jane Stanford Way
Please join us for a conversation with Professor Hui Qin. The lecture will be held primarily in Chinese, translation services will not be available.
About the Speaker
Professor Qin Hui (秦晖) is an economic historian best known for his work on peasant studies and an influential public intellectual. He retired as Professor of History, Institute of Humanities and Social Sciences, Tsinghua University, in 2017 and then served as a Visiting Professor at the Chinese University of Hong Kong. Qin’s academic research is focused on land ownership and peasant wars and, in the last two decades, he has written on many different aspects of China’s rural economy. As a leading figure in rural studies, Qin’s acerbic comments on a wide range of social issues, particularly those concerning China’s rural population and migrant workers, have earned him many fans. He is a sought-after media commentator in print, on TV and online.
William J. Perry Room C231, Encina Hall
Hui Qin, Professor of History, Emeritus, Tsinghua University
Seminars
Debt Trap Diplomacy: BRI’s Ultimate Aim? Or an Unfortunate Media Fabrication?
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Within the discourse surrounding the Belt and Road Initiative (BRI), the concept of debt trap diplomacy has garnered significant attention. Critics argue that the BRI is a cunning strategy to ensnare nations in debt and exert control, while proponents maintain that such claims are distorted by media sensationalism. In this session, we dissect the origins, evidence, and consequences of debt trap diplomacy allegations, aiming to uncover whether they reflect a genuine strategy or an exaggerated narrative. Join us for a nuanced exploration of this pivotal aspect of the BRI conversation.
Dr. Deborah Brautigam is the Bernard L. Schwartz Professor of Political Economy and Director of the China Africa Research Initiative at Johns Hopkins University’s School of Advanced International Studies (SAIS). Her most recent books include The Dragon’s Gift: The Real Story of China in Africa (OUP, 2010) and Will Africa Feed China? (OUP, 2015). Before joining SAIS in 2012, she taught at Columbia University and American University. Dr. Bräutigam’s teaching and research focus on international development strategies, governance, and foreign aid. She has twice won the Fulbright research award and is a recipient of fellowships from the Council on Foreign Relations, the Woodrow Wilson International Center for Scholars, and research grants from the UK Economic and Social Research Council (ESRC) and the UK Centre for Economic Policy and Research (CEPR). She has served as a consultant for Transparency International, the United Nations, the World Bank, DFID, GIZ, DANIDA, the African Development Bank, and USAID, and has provided commentary to the Financial Times, the New York Times, the Guardian, CNN, NPR, Al-Jazeera, VOA, CCTV, and MSNBC. Dr. Bräutigam has been a visiting scholar at the World Bank, a senior research fellow at the International Food Policy Research Institute (IFPRI), and advised more than a dozen governments on China-Africa relations. Her PhD is from the Fletcher School of Law and Diplomacy, Tufts University.
Francis Fukuyama is the Olivier Nomellini Senior Fellow at Stanford University's Freeman Spogli Institute for International Studies (FSI), and a faculty member of FSI's Center on Democracy, Development and the Rule of Law (CDDRL). He is also Director of Stanford's Ford Dorsey Master's in International Policy, and a professor (by courtesy) of Political Science. Dr. Fukuyama has written widely on issues in development and international politics. His 1992 book, The End of History and the Last Man, has appeared in over twenty foreign editions. His most recent book, Identity: The Demand for Dignity and the Politics of Resentment, was published in Sept. 2018. His latest book, Liberalism and Its Discontents, was published in May 2022. Francis Fukuyama received his B.A. from Cornell University in classics, and his Ph.D. from Harvard in Political Science. He was a member of the Political Science Department of the RAND Corporation, and of the Policy Planning Staff of the US Department of State. From 1996-2000 he was Omer L. and Nancy Hirst Professor of Public Policy at the School of Public Policy at George Mason University, and from 2001-2010 he was Bernard L. Schwartz Professor of International Political Economy at the Paul H. Nitze School of Advanced International Studies, Johns Hopkins University. He served as a member of the President’s Council on Bioethics from 2001-2004. Dr. Fukuyama holds honorary doctorates from Connecticut College, Doane College, Doshisha University (Japan), Kansai University (Japan), Aarhus University (Denmark), and the Pardee Rand Graduate School. He is a non-resident fellow at the Carnegie Endowment for International Peace and at the Center for Global Development. He is also a member of the Board of Trustees of the Rand Corporation, the Board of Governors of the Pardee Rand Graduate School and the Volcker Alliance, and a member of the American Political Science Association and the Council on Foreign Relations. Dr. Fukuyama is married to Laura Holmgren and has three children.
Michael Bennon is a Research Scholar at CDDRL for the Global Infrastructure Policy Research Initiative. Michael's research interests include infrastructure policy, project finance, public-private partnerships and institutional design in the infrastructure sector. Michael also teaches Global Project Finance to graduate students at Stanford. Prior to Stanford, Michael served as a Captain in the US Army and US Army Corps of Engineers for five years, leading Engineer units, managing projects, and planning for infrastructure development in the United States, Iraq, Afghanistan and Thailand.
Moderator:
Jean C. Oi is the William Haas Professor of Chinese Politics in the Department of Political Science and a Senior Fellow of the Freeman Spogli Institute for International Studies (FSI) at Stanford University. A Ph.D. in Political Science from the University of Michigan, she directs the China Program at the Shorenstein Asia-Pacific Research Center and is the Lee Shau Kee Director of the Stanford Center at Peking University. She also is the current President of the Association for Asian Studies.
Jean Oi, William Haas Professor of Chinese Politics at Stanford University
Philippines Room, Encina Hall 3rd floor, Room C330
616 Jane Stanford Way, Stanford, CA 94305
Dr. Deborah Brautigam, Bernard L. Schwartz Professor of Political Economy and Director of the China Africa Research Initiative at Johns Hopkins University’s School of Advanced International Studies (SAIS)
Francis Fukuyama, Olivier Nomellini Senior Fellow, FSI; Director, Ford Dorsey Master’s in International Policy
Michael Bennon, Research Scholar & Program Manager, Global Infrastructure Policy Research Initiative (CDDRL)
Panel Discussions
AIIB’s Place in the BRI: Myths and Realities
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As the Belt and Road Initiative (BRI) continues to shape global connectivity, the role of the Asian Infrastructure Investment Bank (AIIB) within this expansive framework often sparks debate. In this session, we delve into a comprehensive analysis of the AIIB's actual contributions, dispelling myths and shedding light on its genuine impact within the context of the BRI.
Speakers:
Maria Adele Carrai is an Assistant Professor of Global China Studies at NYU Shanghai. Her research explores the history of international law in East Asia and investigates how China’s rise as a global power shapes norms and redefines the international distribution of power. She co-leads the Research Initiative 'Mapping Global China,' and is the author of Sovereignty in China: A Geneology of a Concept since 1840 (CUP 2019) and co-editor of The China Questions 2 - Critical Insights into US-China Relations (HUP 2022). Before joining NYU-Shanghai, she was a recipient of a three-year Marie-Curie fellowship at KU Leuven. She was also a Fellow at the Italian Academy of Columbia University, Princeton-Harvard China and the World Program, Max Weber Program of the European University Institute of Florence, and New York University Law School.
Rodrigo Salvado is a Director General at the Asian Infrastructure Investment Bank. Salvado manages the Operational Partnership Department, which administers AIIB’s Special Funds resources. He also manages AIIB’s engagement with global and regional coordination mechanisms and partners to build relationships and mobilize additional resources for the Bank’s investment operations. Before joining AIIB in August 2022, he was Deputy Director, International Development Finance for the Bill & Melinda Gates Foundation, where he was in charge of building strategic partnerships and setting up innovative financing mechanisms to mobilize public and private resources toward the Sustainable Development Goals. Previously, he worked for the African Development Bank Group where he was in charge of the Performance Based Allocation System of the African Development Fund and the coordination of the Annual Country Policy and Institutional Assessment. He also worked as a policy analyst for the Center for International Development at Harvard University and as a senior financial officer at the Central American Bank for Economic Integration in Honduras. Rodrigo holds a master’s degree in public administration in International Development from Harvard Kennedy School of Government, a master’s degree in economics from the Centro de Estudios Monetarios y Financieros in Madrid, and a bachelor’s degree of Science in Economics from the Universidad Torcuato Di Tella in Argentina. He is from Italy and Argentina.
Moderator:
Jean C. Oi is the William Haas Professor of Chinese Politics in the Department of Political Science and a Senior Fellow of the Freeman Spogli Institute for International Studies (FSI) at Stanford University. A Ph.D. in Political Science from the University of Michigan, she directs the China Program at the Shorenstein Asia-Pacific Research Center and is the Lee Shau Kee Director of the Stanford Center at Peking University. She also is the current President of the Association for Asian Studies.
Jean Oi, William Haas Professor of Chinese Politics at Stanford University
Philippines Room, Encina Hall 3rd floor, Room C330
616 Jane Stanford Way, Stanford, CA 94305
Maria Adele Carrai, Assistant Professor of Global China Studies, New York University - Shanghai
Rodrigo Salvado, Director General, Operational Partnership Department, Asian Infrastructure Investment Bank
Panel Discussions