In 1978, China was a nearly autarkic country. But in the 30 years that followed, the country transitioned to become the world’s largest manufacturer and goods exporter. Today, China is a major actor in global value chains, accounting for nearly 20 percent of global manufacturing trade and an even greater share of many intermediate global value chain inputs that are essential for production. So how did China become so deeply integrated into global supply chains? What has been the role of industrial policies in China’s achievement of supply chain dominance?

To answer these questions and to discuss China’s dominance in global supply chains, host Bonnie Glaser speaks with Dr. David J. Bulman, the Jill McGovern and Steven Muller Assistant Professor of China Studies and International Affairs and the US Director of the Pacific Community Initiative at the Johns Hopkins School of Advanced International Studies. His research examines economic and political development in China and the implications for US-China relations.

China’s Dominance in Global Supply Chains

China’s rise has captivated and vexed the international community. From defense, technology, and the environment, to trade, academia, and human rights, much of what Beijing does now reverberates across the map. China Global is a new podcast from the German Marshall Fund that decodes Beijing’s global ambitions as they unfold. Every other week, host Bonnie Glaser will be joined by a different international expert for an illuminating discussion on a different aspect of China’s foreign policy, the worldview that drives its actions, the tactics it’s using to achieve its goals—and what that means for the rest of the world.

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China’s rate of economic growth has slowed markedly in recent years. According to Chinese government statistics, the economy grew by 5.2% in 2023. There are numerous challenges: weak consumer confidence, mounting local government debt, and a real estate market that used to fuel the economy, but is now in a prolonged downturn.

Many economists, including some in China, advocate that the government stimulate consumer spending. It is clear, however, that Xi Jinping is pursuing a different strategy. And this was quite clear when Chinese Premier Li Qiang delivered the Government Work Report last March.

Host Bonnie Glaser is joined by Tanner Greer, who argued in a recent article published in Foreign Policy and in his blog, The Scholar’s Stage, that Xi Jinping and the Politburo believe that science and technology are the answer to China’s problems. To quote from the article: “the central task of the Chinese state is to build an industrial and scientific system capable of pushing humanity to new technological frontiers.” Tanner is the director of the Center for Strategic Translation. As a journalist and researcher, his writing focuses on world politics and history.

Xi Jinping and China's Techno-Industrial Drive

In the past few weeks, China’s relations with Latin America and the Caribbean have been making headlines. Newsweek published an exclusive story about plans to create a Chinese-run special economic zone on the island of Antigua that will have a port, a dedicated airline, its own customs and immigration procedures, and be able to issue passports. An international crypto services zone will offer opportunities to participate in cryptocurrency operations from mining to dealing.

The Americas Quarterly reported that China has expressed interest in building a port complex near the Strait of Magellan at the southern tip of South America, which is considered the most important natural passage between the Atlantic and Pacific Oceans. From there, according to the Americas Quarterly, Beijing could grow its presence in the region and also project influence in Antarctica.

And in late April, China held the first China-Latin American and Caribbean States Space Cooperation Forum, which opened with a congratulatory letter from Xi Jinping applauding the high-level space cooperation partnership in which he emphasized the benefits of marrying China’s mature space technology with the unique geographic advantage of the countries in the Latin America and Caribbean region.

To discuss Chinese interests in and strategy toward the Latin America and Caribbean region–known as the LAC–host Bonnie Glaser is joined by Leland Lazarus. He is the Associate Director of National Security at Florida International University’s Jack D. Gordon Institute of Public Policy and an expert on China-Latin America relations. He formerly served as the Special Assistant and Speechwriter to the Commander of US Southern Command and as a State Department Foreign Service Officer, with postings in Barbados and China.

China's Expanding Ties with Latin America and the Caribbean

The Biden administration maintains that China is the only country with both the intent to reshape the international order and the power to do so. One part of China’s economic statecraft toolkit involves state-directed investments through high profile projects in the Belt and Road Initiative which are funded by loans through Chinese development banks. But the role and impact of Chinese companies that provide equity funding for foreign direct investment (FDI) often receive less attention. Does Chinese FDI have illiberal effects on recipient countries. And is this goal part of China’s economic statecraft and foreign policy strategy.

To address these questions and more, host Bonnie Glaser is joined by Dr. Jan Knoerich. He is the author on a chapter of Chinese FDI on the recent Oxford publication “Rising Power, Limited Influence”, a collection of essays on the effects of Chinese investment in Europe. Dr. Knoerich is a senior lecturer on the Chinese economy for the Lau China Institute at King’s College in London. He is an expert on the Chinese economy, FDI, and international investment law and policy.

Illiberal Effects of Chinese Foreign Direct Investment

When Hong Kong was handed over to China by the United Kingdom 1997, the city was given a mini-Constitution called the “Basic Law.” Article 23 of the Basic Law states that Hong Kong shall enact laws of its own to prohibit various national security offenses. The law did not pass, however, and was scrapped after mass protests in 2003. And in 2020, the Central Government of the People’s Republic of China (PRC) imposed a separate national security law on Hong Kong, citing the city’s delay in acting on Article 23. 

This year on March 19th, Article 23 was passed unanimously by the city’s parliament and it came into effect just days later. The law covers five types of crime: treason, insurrection and incitement to mutiny, theft of state secrets, and espionage, sabotage, and external interference. Critics say that Article 23 could lead to even further erosions of civil liberties in Hong Kong.

To discuss Article 23 and its implications, host Bonnie Glaser is joined by Dr. Eric Yan-ho Lai. Dr. Lai is a Research Fellow at the Georgetown Center for Asian Law, an Associate Fellow at the Hong Kong Studies Hub of the University of Surrey, and a member of the Asian Civil Society Research Network.

Article 23: Implications for Hong Kong

In the past decade, policy toward China has hardened on both sides of the Atlantic. Governments and publics across Europe and in the United States view Xi Jinping as implementing more repressive policies domestically and more aggressive policies abroad. The US and most capitals in Europe see Beijing as seeking to revise the international order in ways that would be disadvantageous to democracies. They agree on the need for de-risking and to preserve the status quo in the Taiwan Strait. 

Yet, despite the alignment in transatlantic assessments, cooperation on China remains limited. A new paper by experts from Chatham House and RUSI, leading think tanks in the United Kingdom, analyzes why transatlantic mechanisms have made slow progress, focusing on three domains: economics; security; and the multilateral system and global norms. The paper also offers ways to strengthen cooperation going forward. 

The title of the report is “Transatlantic China Policy: In Search of an Endgame?” Host Bonnie Glaser is joined by one of its authors, Ben Bland who is the director of the Asia-Pacific program at Chatham House. His research focuses on the nexus of politics, economics, and international relations in Southeast Asia, as well as China’s growing role in the broader region and the contours of US–China strategic competition.

China’s Dominance in Global Supply Chains

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