Time to treat China as a “hostile state”

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Via Bloomie:

China has concealed the extent of the coronavirus outbreak in its country, under-reporting both total cases and deaths it’s suffered from the disease, the U.S. intelligence community concluded in a classified report to the White House, according to three U.S. officials.

The officials asked not to be identified because the report is secret, and they declined to detail its contents. But the thrust, they said, is that China’s public reporting on cases and deaths is intentionally incomplete. Two of the officials said the report concludes that China’s numbers are fake.

Via Con Coughlin at the UK Telegraph:

When the Government says that there needs to be a “reckoning” with China once the coronavirus emergency is over, its focus must be much broader than simply examining Beijing’s culpability in creating the pandemic.

The deliberate lack of transparency and cooperation that has characterised the Chinese Communist Party’s (CCP) response to the outbreak since the virus was first identified in Wuhan constitutes nothing less than a fundamental breach of trust between China and the rest of the world.

Despite Beijing’s attempts to cover up the true scale of the outbreak in China, British scientists are now warning Downing Street that the CCP has probably downplayed the number of cases by a factor of 15 to 40.

To make matters worse, Beijing has compounded its reprehensible behaviour by launching a disinformation campaign that seeks to portray China as the victim, rather than being the instigator of a global health crisis that has so far claimed almost 40,000 lives worldwide, and caused the greatest slump in global economic activity since the Second World War.

China’s attempts to blame the initial outbreak on an American military delegation that visited Wuhan last October have received short shrift in Washington, while British ministers have privately expressed their disgust at Beijing’s attempts to exploit the pandemic for economic gain with what they call “predatory” offers of help for affected countries.

Nor, as Beijing declares “victory” in its own campaign against the virus, is there any evidence that China has learnt its lesson. The reopening of live animal markets, where bats and scorpions are offered as traditional medicine, suggests China’s rulers have no intention of fulfilling their pledge to close the markets, which is where the virus is believed to have originated.

At every level, the CCP’s response to the coronavirus challenge has been contemptible, to the extent that, once the present crisis is over, there needs to be a radical rethink in Britain and other Western countries about our future dealings with Beijing.

Certainly, the idea that it will be business as normal so far as our trade ties with Beijing are concerned will be totally unacceptable to the vast majority of the British public.

There is a deepening resentment among ordinary citizens that China is ultimately to blame for the disruption the pandemic has inflicted on their daily lives, for causing the greatest assault on their personal freedoms in peacetime, for millions of workers losing their jobs or taking pay cuts, and for victims of the coronavirus ending their days alone and isolated from their loved ones.

China’s appalling conduct from the outset has led ministers to warn that the country risks becoming a “pariah state”, and this assessment must be at the heart of how Britain shapes its future relationship with the CCP.

The first, and most obvious, casualty of Britain adopting a more robust approach to Beijing should be Boris Johnson’s questionable decision to allow the Chinese telecoms giant Huawei access to Britain’s new 5G telecoms network. Even if Mr Johnson persists with the flawed assessment that Huawei can maintain its involvement without jeopardising national security, the Prime Minister will face renewed Cabinet pressure to terminate the arrangement.

Serious consideration must also be given to Britain’s broader trade links with China, which are currently worth around $25 billion a year. For too long British politicians and business leaders have kow-towed to Beijing and ignored the CCP’s repressive rule in the hope of landing lucrative contracts. This has resulted in important sectors of the British economy being out-sourced to the Chinese, from the manufacture of car components to vital pharmaceuticals.

Champions of these profitable trade ties, such as former chancellor George Osborne, who once enthused about a “golden era” in Sino-British relations, worked on the assumption that Beijing did not pose a threat to British interests.

The naivety of this approach has been exposed through China’s response to the coronavirus, with the CCP at one point threatening to withhold the export of key medicinal supplies. If China can no longer be trusted to honour existing trading arrangements in our hour of need, then industry leaders must give serious consideration to relocating key manufacturing back to Britain.

The Government’s forthcoming integrated defence and security review is another area where we need to take heed of the threat China poses to our well-being. The last defence review, in 2015, worked on the assumption that Russia was the state that posed the biggest threat to our security.

This assessment will need to be reviewed in the light of the immense damage Beijing has inflicted on the nation’s economy and health. In future, we will need to focus our attention as much on the inner workings of the CCP’s Central Politburo as we do the Kremlin.

The era when gullible politicians in the West could give China’s motives the benefit of the doubt is well and truly over.

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You’re damn right we should treat Beijing as hostile with all of the implications that follow: military containment; trade diversification; multilateral sanction so on and so forth. Our problem is not “gullible politicians” it is corrupt ones. A CCP stooge still holds the Morrison Government’s majority. Labor is bought by the CCP.

To get this done, poeple will have to march, which seems to me quite unlikely. A new politcal force, perhaps One Nation, might do it. Or maybe the righteous anger derived from hundreds of thousands of dead Americans will be enough to bully Canberra.

After the virus comes the revolution.

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About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.