Analysis & Forecasting

The rise/decline of Asia in a (post-)pandemic world

A UICCS Report - March to May 2020

From March until May 2020, our students engaged in interdisciplinary analyses of consequences of the 2020 COVID-19 pandemic with regard to China’s Belt and Road Initiative (BRI) in Hong Kong, the Bay of Bengal, and the South China Sea. The result is a large-scale research report entitled “The Rise/Decline of Asia in a (post-)pandemic world.

Executive Summary

This report discusses geopolitical, regional and national consequences of (governments’ responses to) the 2020 Covid-19 pandemic in relation to China’s Belt and Road Initiative (BRI) in Asia. Specifically, the various contributions to this report analyse and forecast the interplay of international and regional actors and events in East and South Asia, focusing on Hong Kong, the Bay of Bengal, and South China Sea in a (post-)pandemic world.  We have found that existing power dynamics between China and the rest of the world have only been amplified with the pandemic. This has ramifications for China’s public image, its relationship with other nations, its economic development, and its power over Hong Kong. Importantly, the pandemic overall had a negative influence on the production of infrastructure to support the BRI. However, the weakening of countries in the South China Sea has enabled China to seize back control in various areas. As such, the main research question that this report aims to answer is: What are the consequences of (governments’ responses to) the 2020 COVID-19 pandemic with regard to China’s Belt and Road Initiative (BRI) in Asia? The answer to this question consists of output from ‘classical’ research in the form of country profiles and op-eds, and by creating, playing, and analysing games and simulations pertaining to the scenarios under discussion.

Download “The Rise/Decline of Asia in a (post-)pandemic world” (May, 2020)

Hong Kong

Three key actors to watch in the (post-) pandemic world are China, Hong Kong, and the U.S. The research report discusses China’s role in the pandemic, and the possible ways in which China will come out on the other side. Having been the birthplace of the pandemic, whilst also being an important political actor, it is argued that this pandemic can become the beginning of the rise of China. Hong Kong in turn has become a pivotal actor in the region. Tensions have remained over the looming threat of Chinese force and the expansion of Chinese power. It also holds an important place in the overall plans of China’s expanding BRI network. The Covid-19 crisis has impacted these key actors in differing ways. Covid has caused a depression in the economy and halted much of the BRI’s industry and development projects. This ambitious project – starting in 2013 and being described as a 21st century Silk Road – had already been impeded by slowing economic growth in China, which is currently at its lowest rate in three decades.  As the pandemic continues, the economic downfalls are likely to continue. While adjustments have had to be made to the Belt and Road projects, other actors have also had to adjust their tactics.

Particularly, the Hong Kong protestors who have been forced to adjust their efforts with the restrictions in place due to the current crisis. As the world grapples with the Covid-19 crisis, the protestors of Hong Kong continue to adapt to face the opposing governmental force. Because of this, the Chinese government may see this period as a chance to regain control over the city and suppress the anti-government protestors further. We have seen these events starting to unfold at the end of May, 2020. New security legislation by the Chinese Communist Party has been answered with renewed protests, which are currently being put down forcefully by (riot) police. The Covid-crisis has highlighted the opportunity for a Neo-Colonial thesis that will be discussed in this report, the relationship between mainland China and Hong Kong continues to evolve, the crisis is set to further shape these relations as we move into the future.

With regard to the BRI, for China itself, the corona crisis creates both opportunities and challenges. Although young Hong Kongers vehemently oppose cooperating with the BRI, economic uncertainty makes the government more likely to do so. It also gives them better justification for taking China-Hong Kong relations in this direction. On the other hand, Sinophobia has been on the rise, partially due to economic and social uncertainty brought about by the pandemic. This is only exacerbated by the sometimes-tendentious ways in which data are shown in a visual matter, such as through maps or graphs. The way in which we pick and choose to show certain aspects of data or leave other points out can create a skewed view of the situation. As is common in the face of invisible danger, there has been widespread scapegoating of Chinese people. Apart from the pandemic, it has also become clear that economic dependence on China often comes hand in hand with collaborating on the BRI and this has created some resentment. These suspicions are therefore due to a combination of economic uncertainty, the COVID-19 pandemic, and also a response to the economic dependency that countries have towards China.

”The Covid-crisis has highlighted the opportunity for a Neo-Colonial thesis that will be discussed in this report, the relationship between mainland China and Hong Kong continues to evolve, the crisis is set to further shape these relations as we move into the future”

The Bay of Bengal

The first key region of this report is the Bay of Bengal, located in the northeastern part of the Indian Ocean. It concerns a number of key actors, especially with regards to the Belt Road Initiative with its maritime road passing right through the Bay. Whilst the coronavirus is also making its way to this area, power dynamics in the region may face some subsequent change. China is already facing some difficulties implementing infrastructural change in the region due to the tricky relationship it has with another big power, namely India. China has been leaning a helping hand towards India (aid and equipment) in times of this crisis whilst taking advantage of the slightly tense pre-pandemic relations between India and Bangladesh. However, India sees the growing relationship between Bangladesh and China as a threat and is in turn doing all it can to prevent these ties strengthening even more by providing Bangladesh with aid. Bangladesh, however, is struggling with the pandemic and cannot keep up with the growing number of Rohingya refugees which it cannot accommodate safely due to its preoccupation with its own population. Meanwhile, Myanmar is getting ever closer to China with strong trade deals and increasing BRI related deals being made. Nevertheless, the coronavirus has impacted Myanmar’s trade with China significantly due to closed borders and its economic reliance is thus ever growing.

As a result of the war, Sri Lanka has a towering debt and the government is trying to get the economy going again. In return for the Chinese bailout which the nation needed as a result of this, China has carried out significant works in Sri Lanka under the Belt and Road Initiative. Sri Lanka has been dubbed the closest strategic partner of China in their MSR initiative as a result. Sri Lanka’s government’s response to COVID-19 was strict, keeping their infection and death rates relatively low. Yet, the outbreak of this virus will leave Sri Lanka with both an economic recession, a debt larger than 6 billion USD to China, and multiple ports under China’s control.

Since the early stages of the South China Sea dispute, Indonesia has repeatedly asserted its position as a non-claimant state, even though parts of China’s ‘Nine-dash line’ overlap with Indonesia’s exclusive economic zone, leaving the relationship with China as a tricky one. Over the past year, Chinese investments in Indonesia, mainly focused on infrastructure and manufacturing, have doubled.  Furthermore, Indonesia was hit hard by the COVID-19 crisis, in general showing that the country’s healthcare system was not ready for the crisis. Indonesia’s relationship with the US is strong, since they both want to increase stability in the region.

The South China Sea

The second key region for analysis is the South China sea. This extremely complex region carries with it a number of geopolitical tensions and disputed territories. The relations among the South China Sea territories have only become more complex with the recent outbreak of COVID-19. While negatively affecting the development of (maritime) infrastructure, the simultaneous weakening of countries in the South China Sea enables China to expand its foothold in these waters. The successful handling of the COVID-19 crisis by Taiwan has brought its tensions with China into even larger relief, especially through its continued ban from WHO. Relations between the Philippines and China have worsened recently, especially after the Reed Bank incident in 2019, where a Filipino fishing vessel was sunk and abandoned by a Chinese vessel.

Other countries to watch are Malaysia and Vietnam. Malaysia has a better relationship with China, formed mainly due to its reliance on China for trade. More recently, Malaysia has gained significant aid from China to combat the Pandemic. Some cite the multiple investment projects, and Belt and Road initiatives in Malaysia as the reason why Malaysia has taken a historically reserved stance in exerting their sovereignty against China in the South China sea. It remains to be seen if the pandemic, and the resulting delay in these projects will change the geopolitical balance of the region. Vietnam has had rocky relations in the region during the Cold War. After the Cold war, however, its relations with its neighbours improved greatly. Malaysia and Vietnam enjoy good relations and the Philippines is a strong economically. In addition, Vietnam is now chairman of ASEAN, which gives it the power to set the agenda of regional efforts. Unlike with other countries in the region, conflict in the South China Sea has caused hostile relations between China and Vietnam.

”It remains to be seen if the pandemic, and the resulting delay in these projects (BRI & other investments red.) will change the geopolitical balance of the region”