‘Don’t ignore China’s economic coercion’: former Clinton aide’s advice to next US president

Washington needs to ‘develop answer’ to China’s flexing of economic muscle, says former state department aide to Hillary Clinton

PUBLISHED : Thursday, 29 September, 2016, 8:54am
UPDATED : Thursday, 29 September, 2016, 11:29pm

Washington has focused too much on the military aspect of competition with China, and has overlooked Beijing’s economic coercion of its neighbours to reinforce its dominance in the South China Sea, a former top aide to US presidential candidate Hillary Clinton says.

Over the past few years, relations between China and the United States have often been strained, most notably in recent times over the South China Sea. Beijing has constructed artificial islands amid a military build-up in the region, while Washington has frequently sent warships on what it calls “freedom of navigation operations” in the contested waters.

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But former Clinton aide Jennifer Harris, now a senior fellow at the New York-based Council on Foreign Relations, told the South China Morning Post the next US president should “develop an answer” not just to China’s military rise, but also the less-talked-about flexing of its economic muscle.

She said America’s South and East China seas policy “needs to take a bit more seriously than it is currently just how much of the Chinese coercion is taking an economic form”.

Before joining the Council on Foreign Relations, Harris was a member of the US Department of State’s policy planning staff, responsible for global markets, geoeconomic issues and energy security. In that role she was lead architect of then secretary of state Clinton’s economic statecraft agenda, launched in 2011.

Harris said economic statecraft was the use of economic tools, such as sanctions or trade incentives, as leverage to achieve a country’s political goals. The US policy was also designed to drive America’s economic recovery following the 2007-2008 global financial crisis, she said.

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Harris cited the recent US opening to Cuba as an example of the country putting more focus on using economic incentives to advance its political aims.

But Washington’s mastery of economic statecraft still lagged behind Beijing’s, she said, with China much better at systematically using its economic influence to “get its way”.

“China is using systematic elements of its economic power to advance its geopolitical position – whether it is reducing the number of countries in the world that recognise Taiwan, curtailing activities of the Dalai Lama, or … imposing economic costs on countries in Europe that are vocal on human rights [in China],” she said.

“This is one area that China has done pretty well in advancing its interests, and the US has done less admirably in the use of economic tools to advance objectives.”

On the territorial disputes in the South China Sea, Harris cited China’s banning of imports of Philippine bananas since March 2012, shortly before a flare-up in tensions at the Scarborough Shoal, as an example of Beijing using economic means to vent its displeasure.

“That is the sort of thing that the US needs to find fitting ways of pushing back on,” she said.

The Philippines, once among the most vocal of South China Sea claimants, has softened its tone against China since its new president, Rodrigo Duterte, took office in June.

Duterte has promised to “shut up” on the maritime disputes in exchange for China’s support of infrastructure projects in the Philippines. He has also signalled a potential shift in the country’s military alliance with the US.

“Right now there is a lot of Chinese coercion driving the softening of the Philippines,” Harris said. “Thus far the US has yet to develop an answer to any of these systematic uses of economic statecraft by China.”

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But Harris said there had also been cases when China has pushed too hard and prompted resistance, citing the examples of Vietnam deciding to join the US-led Trans-Pacific Partnership as a way to balance its economic dependence on China, and Japan’s remilitarisation amid rising tensions with Beijing.

Asked whether her former boss, Clinton, would be tougher on China if she was elected US president in November, Harris said: “I think that’s largely up to China. To me, the largest variable, the set of unknowns there, is really in China’s hands – what China does and doesn’t do.”

She said the dynamics of the relationship between Beijing and Washington had already experienced a major shift since President Xi Jinping became Communist Party general secretary in 2012 and “taken the foreign policy in a different direction”.

“China has been enormously successful over the past at least 10 years, and accelerating under Xi Jinping, in flexing economic muscle to get its way,” she said.

Washington’s “pivot” to Asia, announced in 2011 and later rebranded a “rebalance”, has been seen as a response to the rise of China.

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Harris said that if Clinton was elected president, her foreign policy was likely to continue the direction of the current Barack Obama administration. Clinton was secretary of state during Obama’s first four-year term as president and has been credited as a leading architect of the rebalance to Asia strategy.

Clinton has also been vocal on tensions in the South China Sea and China’s human rights record.

Although Beijing might not be happy to see the next US leader continue with the rebalance to Asia, Harris said the “predictability” of Clinton’s policy directions, based on her track record, might provide it with a certain level of “comfort”.

“It’s the advantage of having a presidential candidate who has been in the limelight and exposed to public scrutiny for the better part of four years, which I think is helpful when you are managing relations between great powers,” Harris said. “The more data points you have about the leaders, the better.”