We’re kicking off our new show with a three-part series on how the Coronavirus will change global politics. In the first part of this series, foreign policy nerds will break down how the Coronavirus Pandemic will impact the growing rivalry between the United States and China. We also go over how the pandemic affects each country’s influence in global politics, and whether the delicate first phase of the US/China trade deal will survive the crisis.
HUNTER:
Hello and welcome to Geopolitics Rundown, where we break down the biggest foreign policy headlines and give our listeners an inside look at the broader social, political, and security implications of this week’s top stories. We are your hosts Ramya, Ryan, and Hunter, foreign policy nerds from the Elliott School of International Affairs, coming to you from the nation’s capital in Washington, D.C.
HUNTER:
We live in uncertain times, and in the constant barrage of the daily news we often miss out on the big picture–how the events today will shape the way societies interact and compete in the decades to come.
This show is designed to connect today’s events to the broader shifts in international politics, and to give our listeners a global perspective that will help put our confusing times into context. We hope you enjoy today’s episode, the first in a three-part series on the topic that is dominating the headlines–the Coronavirus pandemic.
RAMYA:
Before we jump into our episode today, we wanted to go ahead and introduce ourselves.
My name is Ramya, and I, along with my co-hosts, majored in International Relations at the George Washington University’s Elliott School of International Affairs.
I double concentrated in International Politics and International Economics, so I would say my background is in policy, both foreign and domestic, and its implications on a broader level.
So, tell us about yourself Hunter!
HUNTER:
Alright. My name is Hunter Headapohl, and I concentrated in International Security. My broader background is in geopolitics, but I focused on conflict and arms control.
What about you Ryan?
RYAN:
I studied International Security as well, concentrating in Middle Eastern Studies.
I specialized in conflict and conflict resolution
RAMYA:
The first part of our series will focus on how the COVID-19 pandemic will factor into the geopolitical rivalry between two countries with the first and second largest economies in the world: The incumbent global superpower, the United States, and the rising superpower and economic powerhouse that is China. Let’s Dive In.
RYAN:
Now we’re all tired of alarming headlines and daunting statistics, but to draw a better picture, we’re going to have to lay down some facts.
COVID-19 IN CHINA
HUNTER:
Yea I wanted to preface all this with a bit of a disclaimer — due to the lack of transparency in the Chinese government’s data, there is no way to ascertain the accuracy of these numbers, which experts say are largely underreported.
As it stands when we’re recording this, China has reported 82,665 confirmed cases and 3,335 deaths according to the BBC. Current data suggests that the rate of infections has slowed to a trickle, largely driven by foreign nationals entering the country from elsewhere.
But generally, China seems like it’s over the hump. Hubei province just lifted the lion’s share of their quarantine restrictions, and Wuhan’s lockdown is set to be fully lifted on April 8th.
RYAN:
Interesting. It seems that after a slow start, the Chinese government was able to get its population under lockdown and slow down the virus. Ramya, how’s it going in the US?
COVID-19 IN THE US
RAMYA:
As of today, there are at least 350,000 confirmed cases of Covid-19 in all of the United States. At least 10,000 people have died.
The latest estimates from the White House’s coronavirus task force suggest between 100 and 200,000 people may die.
White House immunologist Dr. Anthony Fauci stated that this estimate is for a middle of the road scenario, and that he is actually preparing for between 1 to 2 million Americans to die from Covid-19.
The situation is dire. Many parts of the country are in lockdown. Businesses have been shut down, employees are being laid off. Hospitals are overflowing and scrambling for supplies. The situation is escalating so rapidly that it is hard to say for sure.
And the worst part is that the Trump administration completely dropped the ball on this one. The US is now suffering from coronavirus more than almost any other country.
HUNTER:
Really? Why do you say that?
RYAN:
Well, back in 2018, the Trump Administration disbanded the Directorate of Global Health Security, a White House task force specifically suited to tackle a pandemic like Covid-19. Losing that has led to a huge lack of testing and personal protective equipment aka PPE. To complicate matters, the US has been sending PPE in aid packages to many other countries.
HUNTER:
I find it pretty weird how the US is sending the protective equipment it needs at home to other countries, especially China. Especially when China is now sending aid to a number of countries.
RYAN:
It gets weirder.
I’ve read reports of Trump officials calling countries like Thailand, asking for PPE, only to be informed by the Thais that the US just sent them multiple shipments of the PPE that the Trump official is requesting. This happened throughout March until the US stopped all aid packages leaving the country in April.
RAMYA:
That sounds very… bizarre. And disorganized.
RYAN:
The Trump administration’s response to the pandemic has left the United States with little of the moral authority and more importantly, little of the credibility that past administrations worked for decades to achieve.
RAMYA:
I like that you said the word credibility. The US lost not just credibility in the international community but has also given the impression that the US government is incompetent.
US leaves vacuum, China sees opportunity
HUNTER:
The vacuum left by the US in global politics gives China an opportunity to both deflect any responsibility for the pandemic and also grow its soft power.
RAMYA:
Let’s talk about soft power really quick.
Soft power is a country’s use of appeal and persuasion as a means of gaining support from other countries.
It contrasts with hard power, which is the use of military force or economic leverage to coerce other countries.
HUNTER:
The thing about China and soft power is that, until recently, China has been a bit lacking in the soft power department.
The Chinese leadership prefers to use economic leverage as a means of gaining support from its neighbors.
Look no further than its seven-year-old Belt and Road Initiative (BRI), a truly massive infrastructure project that involves over 60 countries across Eurasia and Africa meant to create new trade routes for Chinese goods.
RYAN:
Wouldn’t an infrastructure project be a good way of cooperating with other countries and gaining some soft power?
HUNTER:
It would if that’s all the BRI was.
However, China uses the projects to put the other countries into China’s debt. That leverage over the BRI countries is called debt-trap diplomacy, and it has rendered countries like Sri Lanka and Pakistan completely in China’s debt. Essentially, China uses this leverage to force countries to support its geostrategic goals.
The idea here is that China could control the narrative. Chinese leadership wants to go from being seen as ground-zero of the outbreak to being seen as the new superpower who’s doling out support for the rest of the world.
RYAN:
Yeah but weren’t the test kits they sent defective?
RAMYA:
Yep! the ones they sent to Spain were reportedly only 30% accurate.
HUNTER:
So what we’re saying is that both the US and China are sending aid abroad, effectively doing the same thing – helping, while building soft power, but also stumbling at the same time.
RAMYA:
COVID-19 didn’t just tip the scales of soft power — it has done a number on both nations’ economies. And that means that the future of the looming trade deal is dependent on the direction that each country’s economic policy will take.
RYAN:
I know the US economy has taken a massive hit. I think almost 10 million Americans have filed for unemployment in a month.
COVID-19 and the US economy
HUNTER:
Yep. And it is about to get worse. In the wake of Covid-19, there has been a devastating shock to face-to-face service industries, which employ 107.8 million Americans and account for roughly 80% of US economic output as of 2018.
RAMYA:
Yes! And that means people will literally stop having money. Their income will be nonexistent, but loans and rent will be due.
Consumers without money to spend means NOTHING is fueling the economy.
There is enough evidence that we are headed for a recession unlike any before. The Federal Reserve reduced interest rates to near zero to make borrowing cheaper. The US passed a $2 trillion relief bill to put more cash in everyone’s hands, but it will take time for it to have an effect on the economy.
COVID-19 and Chinese economy
HUNTER:
That’s not to say China got through this unscathed. In fact, China’s economic meltdown caused a ripple effect throughout the world.
Since the emergence of Covid-19, all Chinese manufacturing plants have either drastically slowed or completely halted operations.
China’s economy has always been export-based – I’m sure that everyone has seen the phrase “Made in China” written on almost every object they own. In January and February, China’s exports dropped by 17.2%.
Now here’s the problem: this is worrying because China is a global leader in intermediate goods.
These goods are seperate parts that will be compiled and assembled in another factory, likely in a foreign country.
When large numbers of factories shut down, it created a ripple effect that resulted in what experts are calling global supply chain shocks. So many countries are relying on China for intermediate goods for their products, and now no can get them, so the production of goods is halting all over the world.
RYAN:
So circling back to the trade deal then, what does it look like now in the wake of coronavirus?
RAMYA:
Yea so China and the US signed phase 1 of the trade deal right before the outbreak picked up on January 14th.
The basic terms of the deal were that China will increase purchases of energy, services and agricultural products by $200 billion by 2021. In return, the US will cut the tariff rate by half on some $120 bil worth of Chinese goods.
China also made additional concessions, pledging to stop devaluing its currency to gain a trade advantage and opening their financial services markets to US companies like banks and credit rating agencies.
HUNTER:
Do you think the trade deal will remain in effect or will one, or both, back out?
RAMYA:
China has given the impression it will import US goods as part of the deal.President Trump endorsed Beijing’s efforts to fulfill the agreement as well.
RYAN:
Which makes sense because they are trying to win public appeal and gain some soft power.
RAMYA:
Exactly. And just like everyone else in the world, they need imports, especially because their manufacturing took a big hit.
HUNTER:
So all that remains is whether the US will stick with it.
RAMYA:
I think they will too. Remember that the US tariffs on chinese goods have been coming out of Americans’ pockets for years, so this is the perfect opportunity to get rid of them without admitting that they weren’t effective. However, the US is really relying on phase 2 to make the rest of the deal lucrative, and that section of the trade deal is up in the air until phase 1 ends in 2021. So the deal isn’t over, but it has reached a stable point where both sides can work together for now.
HUNTER:
So let’s wrap this episode up and go over our final takes. Basically, what’s something people should remember even if they don’t remember anything else?
RYAN:
Both China and the United States have been hit hard by coronavirus, the US more so than China, both socially and economically. China could have done more to potentially prevent Covid from becoming a global pandemic, and the United States was, to be frank, completely unprepared for the severity of the outbreak and was slow to respond because of that.
HUNTER:
The United States was caught off balance by the scale and severity of the coronavirus pandemic, and it is now the global epicenter of the virus. While they battle the virus at home, the US can’t send out the international aid it’s known for, and has lost some of its credibility and influence on the world stage. This gives China, who had its own problems with Covid but is largely recovering, a chance to send aid and grow its soft power at America’s expense.
RAMYA:
Both the Chinese and US economies have taken serious blows in the wake of supply chain shocks caused by coronavirus. They will most likely use phase 1 of their trade deal to keep their bilateral relations up while their economies recover. In the long run, look to the United States and the rest of the world relying less on China-centric supply chains.