Thursday, January 14, 2021

Perspectives of the US-China relations: Implications for Armenia

By Dr. Benyamin Poghosyan

Center for Political and Economic Strategic Studies, Yerevan, Armenia

Perspectives of the US-China relations: Implications for Armenia

The four years of President Trump’s rule will most probably remain in the history of the United States as years of unprecedented turmoil. It started from Presidential executive orders to ban visas for several countries, continued with the tumultuous Russian investigation and impeachment process, almost permanent skirmishes with the key US allies, and ended up with an attack on the Capitol, suspension of the incumbent US President’s Twitter, Facebook and Instagram accounts, and the prospects of the second impeachment in the last days of the current administration.

These extraordinary developments may force many to conclude that President Biden will make significant policy shifts in all major domestic and external issues. However, there is at least one domain, where most probably the new administration policy will not differ from Trump's actions, albeit wrapped up by other wording – and it is relations with China. Since the late 1970s US policy towards China was based on the strategy of engagement. Two key assumptions were underpinning that policy – the US needs friendly China in its rivalry with the Soviet Union, and the engagement with China will accelerate the economic growth and the creation of a middle class in the 'Middle Kingdom". According to the "democratization playbook", the middle class will inevitably demand more personal freedoms and respect for human rights, which in its turn will sooner or later transform China into some sort of democracy. 

This engagement strategy was in place during both Bill Clinton and George W. Bush administrations and continued by inertia also during President Obama's first term. However, starting from the late 2000s there were growing signs of concerns in the United States that the anticipated democratization of China is not taking place, while Chinese economic might is starting to transform into political and military strength. The “Pivot to Asia” policy launched by the then-Secretary of State Hillary Clinton’s article published in the Foreign Policy magazine in October 2011 was the first policy initiative by the US government to respond to the changing geopolitics of the Asia-pacific and the general shift of the financial and economic center of the world from the Euro-Atlantic space to the East. However, the 2014 events in Ukraine and the crisis in Russia – West relations again brought the problems of European security into the forefront of American foreign policy. The European Reassurance Initiative launched in 2014 and later transformed into the European Deterrence Initiativethe NATO enhanced forward presence, as well as the rise of Islamic State in Syria and Iraq in 2014 somehow shadowed the growing rivalry with China. 

However, the China problem did not disappear and the rise to power of President Xi, the launch of his signature “Belt and Road Initiative” in September 2013, and elaboration of the long term Chinese economic strategies for developing its advanced manufacturing base such as “Made in China 2025” released in 2015 aimed to update China’s manufacturing base by rapidly developing ten high-tech industries, were all perceived by growing anxiety in the US.

Winning the November 2016 Presidential elections with protectionist and anti-globalist slogans such as ‘Making America Great Again” President Trump had no other choice but to go after China. His key electoral base was low educated and disappointed white voters, many of whom lost their jobs due to the dislocation of industrial clusters to China and other Asian countries and whose average income did not raise for the last 20-30 years. The wake-up call for China and the world was the December 2017 US National Security Strategy, which explicitly labeled China as a strategic competitor. The key person behind Trump’s China strategy was Matthew Pottinger, former Marine intelligence officer in Iraq and previously Wall Street Journal Reporter in China in 2003. 

The anti-China sentiments in the National Security Strategy were included also in the US Department of Defense “Indo-Pacific Strategy Report” published in June 2019 and the US Department of State “A Free and Open Indo-Pacific: Advancing a Shared Vision” report published in November 2019. The US also has taken significant actions to reinvigorate the "Quad" group comprised of the US, India, Japan, and Australia. During the October 2020 meetings of Quad’s ministers of foreign affairs among the key issues was the discussion of the Free and Open Indo-Pacific (FOIP) initiative for greater security and economic cooperation that Japan and the U.S. have been pushing to bring together “like-minded” countries that share concerns about China’s growing assertiveness and influence.

Another front of President Trump's struggle against China was the economy. President launched an explicit trade war with China in 2019 and despite the signature of the "phase one trade deal" between the US and China in January 2020, disagreements on the economy including issues related to the protection of intellectual property, forced technology transfer, and others remain in place.

The upcoming Biden administration most probably will continue key features of President Trump’s policy toward China. In late November 2020, Chinese President Xi Jinping sent Biden a congratulatory message, in which President Xi said he hoped the incoming team would "uphold the spirit of non-conflict, non-confrontation, mutual respect, and win-win cooperation." However, most probably Chinese hopes will not become the reality. Biden's plans to nominate Antony Blinken as Secretary of State and Jake Sullivan as national security advisor showed his intention to continue the tough line against China. Blinken laid out his thinking on China in a July 2020 Hudson Institute event when he argued that Trump put the United States in a weaker strategic position vis-a-vis China by undermining alliances and waffling on values promotion. Blinken promised to rally allies toward the mission of pushing back on China's various bad behaviors. 

As for Jake Sullivan, he laid out his thinking on China in his September – October 2019 Foreign Affairs essay on China co-authored with Kurt M. Campbell and in his May 2020 piece in Foreign Policy co-authored with Hal Brands. The main argument of both pieces was the idea that China intended to compete with the US for global leadership and the US should take serious actions to confront Chinese threats.

In his calls with Asia-Pacific leaders, President-elect Biden was using the "Secure and prosperous Indo - Pacific region” terminology, thus departing from President Trump's administration's "Free and open Indo-Pacific region" phrasing. However, this is a mainly rhetorical change, while the key components of anti-China policy most probably will remain in place. 

The US will continue its policy to limit China's access to US digital technologies and will foster its relations with regional allies to rally them against China. The US will continue to press China on issues related to human rights and religious freedom including the situation related to Uyghurs and will seek to use the "International Religious Freedom or Belief alliance" initiative which was established by the US in February 2020.

What implications the US-China relations may have on a small state such as Armenia, which is located 10000 km away from the US and 6000 km away from China, just suffered a serious defeat in the 2020 Karabakh war and was forced to sign a capitulation brokered by Russia on November 9, 2020.

It should be noted that the growing global influence of China brings relations with Beijing into the foreign policy agenda of Armenia too. Even though the South Caucasus is formally not part of the Belt and Road initiative, since 2017 discussions have been underway in Armenia to include the future "Persian Gulf–Black Sea" multimodal transportation corridor connecting Iran with Europe via Armenia, Georgia, the Black Sea, Bulgaria and Greece into the BRI. As China and Iran have been already connected via sea transit, the idea was to create a new "Seventh corridor of the BRI" connecting China with Europe via China – Iran – Armenia – Georgia, and the Black Sea.

However, the imposition of the new US sanctions on Iran in May 2018 and the significant delay of construction of a new highway in Armenia connecting Armenia with Georgia and Armenia with Iran borders have effectively frozen progress on this multimodal transportation corridor project. As for bilateral Armenia - China trade, its volume was expanding but mainly due to the increase in imports from China. Thus, until recently almost everyone in Armenia was speaking about the necessity to develop relations with China, but no strategy has been elaborated on how to do that at the political or economic level. 

The 2020 Karabakh war and its consequences were wake-up calls for Armenia. The initially muted reaction of Russia and the absence of any tangible actions to stop the Azerbaijani attack have raised serious suspicions that the Karabakh war was the result of some sort of Russia – Turkey – Azerbaijan understanding to change the status quo and achieve geopolitical goals. 

Interestingly all three benefited significantly from the outcomes of the war. Russia established a de facto military base in Nagorno Karabakh, thus significantly expanding its influence over Azerbaijan and gaining more leverage on Armenia. Azerbaijan took over not only seven regions outside the former Nagorno Karabakh Autonomous Oblast but also approximately 30 percent of NKAO itself, while in no settlement options suggested by the OSCE Minsk Group Co-chairs during the 26 years of the negotiations held since the May 1994 ceasefire, there was a provision allowing Azerbaijan to take any territory of NKAO. Turkey has increased its role in the South Caucasus and through the establishment of the joint Turkey – Russia monitoring center in Azerbaijan has deployed its troops in Azerbaijan.   

The de facto absence of the EU and the US during the recent war in Nagorno Karabakh was another blow to the long-term Armenian perceptions of the Euro-Atlantic community’s role and priorities in the region. There was confidence in Armenia that the EU and the US will not allow authoritarian Azerbaijan to start the large scale war against more democratic Armenia and the unrecognized Nagorno Karabakh Republic. The Velvet Revolution in Armenia strengthened that perception as Armenian leadership was calling Armenia a new beacon of democracy in the Post-Soviet World. However, the absence of criticism against Azerbaijan and of any EU sanctions imposed during and after the war, as well as the statements after the launch of the ‘Southern gas corridor” about the significant role of Azerbaijan in increasing EU's energy independence were waking-up calls for Armenians that in the current world affairs geostrategic interests matter most.

The shock of the Karabakh war will inevitably force Armenia to re-evaluate its foreign policy priorities and the development of relations with China should be one of the key components of this process. Armenia needs to seriously think about making China a key partner along with Russia and some Western countries. However, as the first step, Armenia should bid a farewell to the old paradigm, according to which China was perceived as an ATM with limitless cash that is ready to pour money everywhere. This is not the case and before asking China for any sort of assistance Armenia should carefully think about what Yerevan may offer to Beijing. Some may argue that Armenia is too small to think about transactional relations with Beijing, but this mindset is originally wrong. There are several areas, where Armenia may assist China and only by doing so it may create a sound base for the serious conversation with Beijing regarding the prospects of political, economic, and defense relationships.

The economy matters more for Armenia, given also the disastrous consequences of the 2020 Karabakh war. Armenia needs Chinese investments but first of all, Yerevan needs both to increase and to diversify its exports to Beijing. The bulk of Armenian export to China in 2019 was copper ore – worth $174 million. Armenia should develop the "Export to China" national strategy, emphasizing agriculture products, and the mobile applications market. However, it's impossible to fully separate economics from politics. Yerevan needs a serious strategy to improve its political relations with China.

Here Armenia, as a minimum, should refrain from participation in projects which are viewed as hostile in Beijing. In this context, the first tangible message which Armenia may send to China should be the cancellation of Armenia's participation in the “International Religious Freedom or Belief Alliance” or a public statement that Armenia will not sign any declaration or statement of the alliance criticizing China.

Armenia joined this alliance in June 2020 stating that its key goal was to use the opportunities of the alliance to protect the Armenian Christian heritage of the Middle East. However, the silence of the alliance during the 2020 Karabakh war during which many artifacts of Armenian Christian culture in Karabakh were destroyed proved that the key goal of the US is to rally member states against China. Thus, Armenia did not receive any benefits from its membership in the alliance while worsening its relations with Beijing. The cancellation of its membership in the alliance may create a favorable perception among the Chinese leadership regarding Armenia and will establish a solid base to start serious negotiations with Beijing on issues about economic, political, and defense cooperation.

About the Author:

Dr. Benyamin Poghosyan
Dr. Benyamin Poghosyan is Founder and Chairman, Center for Political and Economic Strategic Studies and also, Executive Director, Political Science Association of Armenia since 2011. He was Vice President for Research – Head of the Institute for National Strategic Studies at the National Defense Research University in Armenia in August 2016 – February 2019. He joined Institute for National Strategic Studies (predecessor of NDRU) in March 2009 as a Research Fellow and was appointed as INSS Deputy Director for research in November 2010. Before this, he was the Foreign Policy Adviser of the Speaker of the National Assembly of Armenia. Dr. Poghosyan has also served as a Senior Research Fellow at the Institute of History of the National Academy of Sciences and was an adjunct professor at Yerevan State University and in the European Regional Educational Academy.

His primary research areas are the geopolitics of the South Caucasus and the Middle East, US – Russian relations, and their implications for the region. He is the author of more than 70 Academic papers and OP-EDs in different leading Armenian and international journals. In 2013, Dr. Poghosyan was appointed as a "Distinguished Research Fellow" at the US National Defense University - College of International Security Affairs and also, he is a graduate of the US State Department's Study of the US Institutes for Scholars 2012 Program on US National Security policymaking. He holds a Ph.D. in History and is a graduate from the 2006 Tavitian Program on International Relations at Fletcher School of Law and Diplomacy.          

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DISCLAIMER: The views expressed in this insight piece are those of the author and do not necessarily reflect the official policy or position of IndraStra Global.