The cover of Bloomberg Businessweek published on Monday last week reads like a package handling sticker: “Fragile China,” with depictions of four major issues that Beijing would prefer not to deal with — a coronavirus, debt burden, trade dispute and protests — and the added admonition: “Handle with care.”
The magazine is not the only example of global media outlets taunting China and doubting its capabilities, but, in these expressions, the West is also reflecting a realization of its own shameful conduct in the years before COVID-19, when it was led by business interests, but turned a blind eye toward Beijing’s suppression of democracy, freedom and human rights, among other universal values.
Tempted by financial gain, the West became a willing cheerleading squad, rooting on China. In a sense, the rampage of a single coronavirus has exposed the communist empire’s Achilles’ heel, despite its formidable appearance.
The Chinese Communist Party (CCP) has successfully given shape to the mythical “China dream,” with the help of advanced surveillance technology, rapid economic growth and the “grand external propaganda strategy” — to which dozens of billions of yuan are devoted annually — an ascent which is the payoff of 40 years of effort.
China not only plans to compete with the US for global hegemony, but presents its pattern of development as an alternative to developing countries — particularly ones with authoritarian regimes — as a model to learn from.
However, this vast empire — which touts many formulas for success, from which only democracy and free market are missing — finds itself decidedly stretched in its efforts to contain a virus, even though its controls are as stringent as wartime measures and more than half of its citizens are under quarantine.
The virus might swallow up Chinese President Xi Jinping’s (習近平) imperial dreams, taking down the edifice of a regime that the CCP is so proud of. Using politics as the highest guiding principle in fighting a disease could dismantle China’s governing system.
Power might become concentrated in the hands of the military. The public could become like the Red Guards during the Cultural Revolution, who held “mass public trials” for ordinary people so that they could strictly control resource distribution and freedom of movement.
Such circumstances might cause China to regress into a military dictatorship, with fierce power struggles breaking out — relegating prosperity and growth to the dustbin of history.
As the outbreak worsens, the world has focused on its impact on the global economy. After all, China has seen the most people infected and the highest death toll, compared with the rest of the world. There is no sign that the virus is about to be contained; its impact is spreading.
China — as the world’s factory and a consumer market of 1.4 billion people — and its problems have a profound effect on the rise and fall of the global economy and trade. While more than half of its citizens are under quarantine and the state’s strict control, consumption has dwindled to fulfilling people’s basic life needs.
Unsurprisingly, lack of consumption has struck a huge blow to the economy of China, where domestic consumer spending contributes more than 50 percent of GDP growth.
Manufacturing in China has looked unpromising since the Lunar New Year holiday. Despite Xi’s call to reign in disease-prevention measures that had “gone too far” and might affect the economy, factories and enterprises across China still show no signs of fully returning to work.
As the Businessweek report said: “February 2020 will come to be remembered as a period of historic disruption to physical supply chains the world over, as the coronavirus wrecks trade.”
A contraction in shipping — of shipping containers and flight cargo — has led to a drop in manufacturing and exports, while also affecting other sectors such as services, finance, wholesale and retail. It is estimated that as many as 5 million businesses around the world are being affected by China’s delayed return to work and slow recovery.
Taiwan, which is built on trade and close economic connections with China and the rest of the world, might be hit by a much greater impact.
Viewed from a different perspective, the cure for the nation’s sluggish economy — due to the massive number of businesses, funds and talented workers relocating to China over the past three decades — is to be found in reducing reliance on China.
The government has achieved outstanding results by riding the wave of the US-China trade dispute and pushing for Taiwanese businesses to return to invest in the nation. The COVID-19 outbreak has further accentuated the urgency of Taiwanese businesses diversifying supply chains.
The outbreak’s disruption of supply chains can be viewed as a stress test, allowing politicians across party lines to gain an understanding of the effects that unforeseen problems in China’s business environment can have on Taiwan.
The US Chamber of Commerce in China and its EU counterpart are using COVID-19 as an opportunity to stress to US and European enterprises to diversify business operations and move supply chains out of China. It is as if the outbreak has hit the pause button on China’s economy.
The disruption is a warning to politicians from all parties and businesspeople that being overly reliant on China for a strong economy and prosperous trade is dangerous.
It also shatters the illusion of the “triangular trade model” — in which exporters receive orders in Taiwan, but manufacture goods at factories in China — as a means to prosperity.
In the past, government leaders who strongly advised against too much reliance on China, such as former president Lee Teng-hui (李登輝), were often labeled as being “anti-China.”
Many Taiwanese businesses paid no heed, and have been enjoying the advantage of operating or manufacturing at a lower cost in China, while cross-strait compradors keep receiving the “benefits of peace.”
Taiwanese understand that there is no such thing as a separation of politics and economics for the CCP, after witnessing Beijing’s schemes to turn independent Chinese tourists into tools to threaten the Taiwanese government.
The COVID-19 outbreak in China serves as another powerful reminder for Taiwanese: To lead a genuinely free and happy life, and to live and work in peace, the nation needs to keep its distance from China.
Translated by Chang Ho-ming
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