As China’s enormous economy starts to rev up again with the worst of the pandemic behind it, the desperate countries of Central Asia may find their economic and political futures tied to a more assertive Beijing.
With only a relative handful of coronavirus cases remaining, China appears to be the first major economy in the world to recover from the devastating effects of the pandemic.
But the virus continues to ravage Central Asia, where the economies of its five countries were already suffering the shocks of major drops in commodity prices, a fall in remittances from migrant labourers, and a global economic slowdown that could see Central Asia’s gross domestic product contract by up to 5.4 percent by the end of the year, according to the World Bank.
Such a situation leaves Beijing as the main source of help for the region.
“There are no signs that the pandemic has deterred China from its long-term objectives,” Nadege Rolland, a senior fellow at the National Bureau of Asian Research and a Former Adviser on Chinese strategic issues to the French Defence Ministry, said. “Beijing is still intent on seeing China rise to the top in global affairs and it sees the current disorder from the virus as a way to achieve that goal.”
Not missing a beat, China held its first meeting with the foreign ministers of all five Central Asian countries via video-conference on July 16.
Discussion centred on cooperation in fighting the coronavirus and kick starting the region’s staggering economies.
While China has long been one of Central Asia’s dominant players, the narrow format marked a new targeted approach for Beijing with the region, which tends to favour bilateral ties or larger blocs like the Shanghai Cooperation Organisation (SCO) as it finds growing opportunities to expand its influence against the backdrop of the pandemic.
The meeting came as the unimpeded spread of COVID-19 presents an unprecedented challenge to Central Asia that has shown the woeful condition of the region’s health-care systems, laid a tremendous strain on its economies, and put its foreign relations to the test.
In addition to the new means of engaging with Central Asia that was unveiled in July, Beijing has made inroads since the pandemic began with high-profile humanitarian and medical missions and by promoting its digital technologies as a way to limit the spread of the virus.
China has also employed the SCO to help promote its narrative about its response to COVID-19 and looks set to further enmesh Eurasia within its orbit with its Belt & Road Initiative (BRI), a blanket term for the multibillion dollar centre-piece of Chinese President Xi Jinping’s foreign policy that aims to gain influence by building infrastructure and funnelling in investment.
But the pandemic has also supercharged wider trends that could have further shockwaves for Central Asia, particularly a deepening confrontation between China and the United States.
A New Cold War?
Over the last several months, tensions have escalated over Hong Kong, the South China Sea, human-rights abuses in Xinjiang, and a long simmering trade war.
Meanwhile, Washington has also made gains in its campaign to push countries to ban technology made by Chinese telecom giant Huawei over national security concerns. This month saw the United Kingdom announce a ban on using Huawei in its next-generation 5G communications networks, as well as France saying that it would move to severely limit the use of Chinese technology in its own networks.
The escalating rhetoric and moves have seen officials in both Beijing and Washington refer to the growing confrontation as the beginning of a new Cold War.
The Central Asian countries are used to walking a tightrope between large powers and hedging their bets between Beijing, Moscow, and Washington. But as a new reality in Central Asia that is more lopsided in China’s favour begins to present itself, the balancing of the past may be more difficult to maintain.
“Chinese policy-making is still warped towards the United States, so that means the region increasingly gets seen through that lens,” Rafaello Pantucci, Senior Associate Fellow at London’s Royal United Services Institute, said. “The Central Asians will never want to choose sides, but it will be hard to hedge in a world divided by the two. That means they will always bend more to the Chinese perspective.”
Not So Great Games
China’s new way of engaging with Central Asia’s foreign ministers that was unveiled on July 16 is not the first such arrangement in which an outside power engages with the five countries.
Similar arrangements already exist with Japan, South Korea, the European Union, and the United States, which used the format in February during a trip to the region by Secretary of State Mike Pompeo.
It was during that trip to Kazakhstan and Uzbekistan that Pompeo focused his attention on China’s presence in Central Asia, raising concerns about corruption, unsustainable debt, and abuses in Xinjiang, where the Chinese government has reportedly imprisoned more than 1 million Uyghurs and other Muslim minorities in internment camps.
But the visit to the region, the first by a U.S. Secretary of State in five years also brought home the limitations of U.S. engagement in the region.
American interest and involvement in Central Asia have waxed and waned since the collapse of the Soviet Union, intensifying in the aftermath of the invasion of Afghanistan and ensuing anti-terrorism military campaigns.
The region has once again received more attention as Washington increasingly views China and Russia as its two main rivals on the global stage. Despite that, Central Asia is not a policy priority in Washington.
By comparison, Xi has made multiple state visits to the countries since he took power in 2012, most recently last year, and when he announced the launch of the BRI in Kazakhstan in 2013.
Since then, China has become Central Asia’s and the world’s biggest development financier as state-owned banks backed costly building projects in risky markets expanding Beijing’s influence and creating new opportunities for its companies.
It’s through this vehicle that China is looking to capitalise on the chaos created by the pandemic to further its goals and deepen its influence in Central Asia and beyond.
China’s state-owned media has already taken up the call, with numerous articles framing the BRI venture as a means to jump-start global economic recovery.
The initiative was always conceived as a vehicle for China to push its views and build up its influence in the developing world, says Rolland, and the pandemic presents a major opportunity.
“This isn’t the Cold War with clearly defined ideologies and geographic blocs, it looks much more like very malleable spheres of influence,” she said. “China isn’t yet chasing global hegemony, but rather towards creating a subsystem where Beijing would have a constellation of countries that are amenable to its views.”
China’s share in Central Asia could also grow as Russia, another of the region’s large external players faces a steep uphill recovery from the economic slowdown caused by the pandemic and the fall in energy prices.
Moscow and Beijing have grown closer together in recent years and have sought to divide their interests in Central Asia, but China is set to gain new ground as it is poised to keep expanding beyond building large infrastructure projects into other areas in the wake of the pandemic.
“For many years, it’s been that China covers more economic issues and Russia deals more with security, but we are increasingly seeing that those spheres can overlap and the lines between them are starting to blur,” Temur Umarov, an expert on China-Central Asia relations at the Carnegie Moscow Center, said.
A Bumpier Silk Road
While China’s economy has begun to rebound from the pandemic, the pace of its recovery is still uncertain.
These questions come as Beijing faces mounting calls to reschedule loans for shipping hubs, electrical plants, and transport links that look unsustainable as economies around the world from Latin America to Africa to the Middle East, struggle and globalisation slows.
A June survey by the Chinese Foreign Ministry found that 20 percent of the BRI projects have been “seriously affected” by the pandemic, with a further 30 to 40 percent “somewhat affected.”
Fears of a global recession have provoked China’s partners to review the viability of those projects in their countries, which could lead to renegotiation’s or even project cancellations.
So far, though, No major BRI Contracts have been cancelled due to the pandemic, and the initiative is too important to President Xi and to China to be shelved.
But how Beijing will manage the projects amid the pandemic problems around the world will be a key test of its international diplomacy skills.
“Even before the pandemic, concerns were mounting over debt and corruption and the fiscal environment now makes all of that worse,” Jonathan Hillman, the Director of the Reconnecting Asia Project at the Center for Strategic and International Studies, said.
“I think we are looking at a future where Chinese officials will be mostly renegotiating deals rather than chasing new ones.”
Chinese state media have begun trumpeting less costly global initiatives focused on technology and health care rather than high-profile infrastructure projects.
China has also already used the pandemic to focus on digital initiatives, such as in e-medicine, e-commerce, e-payments, and e-learning, and analysts believe that Chinese companies have ample room to expand on these fronts in Central Asia.
Moreover, despite a more cautious approach to the BRI coming from Beijing, China still remains one of the few means of securing financing moving forward, which could drive Central Asian governments closer to China.
“This is an opportunity for China and they will take advantage of it,” said Hillman. “But I wouldn’t expect a big building spree like before. This will be a new phase for Beijing.”