Growth Challenges

The Princeling Has No New Clothes


A new era has begun in China and arguably for the world, with the ascent of Xi Jinping to President of China, and the appointment of new Premier, Li Keqiang. Gone are the more autocratic and stiff character associations of former President Hu Jintao. Xi, like the country itself, is likely to walk taller and more comfortably on the international stage. But will he walk different, other than in stride? We take a look at Xi’s first trip abroad, which begins this week.

Like Hu before him, Xi’s first trip is to Russia. Not only are China and Russia each other’s biggest neighbours (the two share a more than 4,300 km long border, the disputed sections of which were only settled in 2008), they are also the only two developing country and non-NATO permanent members of the UN Security Council. On burning issues such as conflict in Syria, and the nuclear ambitions of Iran and North Korea, China and Russia have recently found common interests in their Council role. With historic tensions over competing claims to the South China Sea between China and several East Asian neighbours flaring up in recent months, finding common interest elsewhere with a fellow Security Council member may have long-run domestic territorial benefits.

Indirectly, a visit first to Russia offers another advantage in diplomatic face-saving. Were for example Xi to visit East Asia first, this would involve necessarily deciding to visit one regional neighbour over others, as would a visit to Europe for example. Since relations with Russia are more stand-alone, and Russia is a large and important neighbour, this choice avoids having to implicitly announce further intra-regional priorities.

And there are obvious additional reasons to prioritise relations with Russia. Most obviously, Russia is among the world’s most important gas and oil exporters while China is the world’s largest energy consumer. Similarly, in many areas of technology Russia is more advanced than China as well as more open to high-tech trade than other more advanced technology frontiers. Finally, the Artic thaw is reportedly opening new shipping lanes to China’s north. This route between China and northern Europe is reported to save shipowners Euro180,000 to 300,000 per voyage, equal to up to a 40% fuel and time saving. Three years ago no ships made the journey. Last year, 46 did. It seems the long-run fruits of deepening ties to China’s north might yet be greater than expected.

From Russia, Xi, alongside his Russian host, will head to Durban, South Africa, for the BRICS summit. There leaders of Brazil, Russia, India, China and South Africa will gather. The BRICS countries represent an economic bloc comprised of five of the world’s leading emerging economies. Running for two days, the summit in Durban will include discussion of a new development bank, the creation of a ‘virtual’ secretariat, as well as an opportunity for host South Africa to better familiarize other BRICS members with some issues particular to the case of African development.

Since the meeting gives respective participating heads of a state a chance to meet bilaterally, Xi’s choice to visit Russia immediately ahead of the summit in South Africa suggests the China-Russia relationship for China is somewhat BRICS ‘plus’ – plus resources, regional cooperation, border security, Security Council agenda items, etc. The biggest loser of these advance discussions may be India, still hopeful of attaining permanent Security Council member status.

From Durban Xi will proceed to the Republic of Congo and Tanzania, before returning to China. Given the number of countries within a few hour’s flight of South Africa, the choice of these two countries is interesting. First, the two countries share in common diplomatic recognition of the People’s Republic in 1964. Roughly this means the visit by Xi is essentially a commemoration of 50-year’s of diplomatic ties.

More recently and following a visit by former Chinese Premier Wen Jiabao in June 2006, China and the Republic of Congo’s governments have established close working ties, with financing for projects including for expansion of the country’s international airport facilities. Since Congo’s government favours a more authoritarian-led development model, and former colonial power France home to powerful activists seeking to charge long-serving President Sassou-Nguesso with theft from the state, China’s economic development focus is attractive. The already frantic pace of oil-centred ties may move more rapidly after Xi’s visit.

Tanzania meanwhile enjoys close ties with China, symbolically reflected in the Tan-Zam railway. Built in the 1970s, the line sought to help landlocked Zambia’s exports by-pass colonial-ruled Zimbabwe to the sea. Of the five East African Community member states – Burundi, Kenya, Rwanda, Tanzania and Uganda – Tanzania receives the most Chinese investment. And unlike the often critical messages voiced by the Presidents of Zambia and South Africa toward China, President Kikwete of Tanzania is better known as an overt supporter of the PRC. Tanzania nonetheless is cracking down on the high number of Chinese traders operating in local markets, and seeking a better deal from China for its own development. Xi’s visit, marking the 50th anniversary of diplomatic ties, might yet deliver a boost to friend and ally Kikwete.

That is, Xi’s itinerary suggests that, at least in the early days of his Presidency, China under Xi is unchanged in being a large and rapidly changing developing country with parallel needs of its own. As head of state, it is these needs that and expectedly appear to be Xi’s priority, at least as far as these carefully pre-selected first steps abroad may suggest.


This is an abridged version of an article first appearing here.

Lauren has worked in economic policy and research at the World Bank, World Economic Forum, EIU and for the governments of Sierra Leone and Guyana. She has learned Chinese since 1995, and lived in Beijing for almost six years, on and off since 1997. Lauren has a PhD in Economics from Peking University, an MSc in Development Economics from the School of Oriental and African Studies (SOAS) and a B.A/B.Com from the University of Melbourne.

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