Has China’s chequebook diplomacy put it on the back foot?

(Image: Reuters)

Recently, Chinese President Xi Jinping addressed the leading cadre of the Communist Party of China (CPC). Xi said he believes “time and momentum are on China’s side”, despite challenges, such as COVID-19 and others.

Yet, behind the confident facade and posturing that China has adopted since the pandemic struck—which has killed over 1,944,750 people worldwide and continues to crush global economy — there may be a certain defensiveness. A couple of events hint at this.

First, is the cancellation of debts owed by the Democratic Republic of Congo (DRC). Beijing wrote off $28 million in matured loans and pledged $17 million of support to the country. While the move may seem to be a good will gesture — Beijing has major mining investments and interest in the DRC — there is a catch. The DRC signed on to China's ambitious connectivity project, the Belt and Road Initiative (BRI), becoming the 45th country to do so.

But why did China have to cancel debts for a country? Does it reflect that Beijing is under considerable strain to prove that its chequebook diplomacy in not out to ensnare poorer countries? Allegations of Beijing's debt trap are borne out by the outcome of its development aid to countries such as Sri Lanka and the Maldives.

Many African countries owe a huge debt to China running into billions of dollars — almost 45 percent of China’s external aid. The pandemic has wreaked havoc with the continent’s economy. It is, therefore, symptomatic of China's defensive posture that not just Chinese foreign minister Wang Yi had to do some explaining about China's philanthropic motives regarding both aid and the BRI.

Numerous Op-eds within a short span of time in the Chinese State-run media have also been at pains to debunk the debt trap theory.

Similarly, China has gone vocal reassuring its all-weather friend Pakistan that it will be standing by it as allegations mount that China is economically enslaving Pakistan with the CPEC, something that has put the project at the receiving end of numerous attacks by local dispossessed communities. The promised jobs and infrastructure have not materialised; Pakistan has once again turned to the IMF for a bailout.

Speculation was rife that China was seeking additional guarantee on a $6 billion loan for a railway project under the CPEC due to Islamabad's financial straits. That Chinese Foreign Ministry spokesman Zhao Lijian had to reject these reports  reflects that China's intentions remain suspect even in Pakistan. Meanwhile, the CPEC Joint Cooperation Committee remains postponed.

Simultaneously, another development has not gained the traction it should have. In early January the Chinese embassy in Washington tweeted a link to an article by State-run China Daily that cited an unpublished report on population reduction in Xinjiang since 2018 by the Xinjiang Development Research Centre. “The minds of [Uighur] women in Xinjiang were emancipated and gender equality and reproductive health were promoted, making them no longer baby-making machines,” the embassy tweeted from the study. Twitter removed the post.

The embassy reposted the same story with a different headline, but the backlash prompted Twitter to close the account.

While backtracking or explaining is a new phenomenon for Beijing, the difference this time was that the tweets generated a backlash in the Muslim world too, which till now has turned a blind eye to the Uighur issue. Countries such as Turkey, so vocal about Muslim rights elsewhere, are accused of deporting Uighur dissidents to China via third countries. Pressure is also being exerted on the Organisation of Islamic Cooperation for its failure to speak up for the Uighurs.

Finally, the virus seems to be turning upon China again. On one hand Chinese Sinovax has met with limited success in Brazil, with President Jair Bolsonaro turning to India. On the other, there is a resurgence of the virus in China, centred in Hebei and Heilongjiang Provinces. Lockdown has once again been imposed in Chinese cities with some 22 million residents. China's initial resistance to allow a World Health Organization is also reflective of a certain defensiveness.

All these seemingly unrelated events indicate a growing unease. Analysts have pointed out that even the summer belligerence at the LAC, which seems to continue with fresh clashes reported on the border,  reflected domestic political weakness of the Chinese leadership.

For a country known for its swagger, and which has brazened its way through unmindful of the enormous suffering it has brought the world, explanations and amendments point to one thing — a kind of course correction born out of necessity. China may finally be on the back foot.