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Centre for Geopolitics

Providing historically-grounded approaches to enduring geopolitical problems.
China Moral Hazard

29th March 2020

Starting the conversation…

Kun-Chin Lin, Deputy Director, Centre for Geopolitics

The Covid-19 pandemic has exposed a fundamental vulnerability in our international society. We are shown to be vulnerable to the moral hazardous behavior of illiberal states operating in a liberal global order. These states compel other states to treat them as just another state, even when they do not share the same convictions for political liberalism, and governance rules such as restraints on the use of force, sanctity of agreements, and respect for human and property rights.

The coronavirus is another demonstration of China’s risk-proliferating behavior – whether due to poor governance of dangerous medical facilities or more troubling biochemical warfare developments as suggested in American FBI reports

Communist China rejoined the international society in the 1970s on unequal terms, and lacking any genuine hedging options in a US dominated capitalist world, it has sought to protect its national interest by selectively adapting to the existing order. Hence it limited its commitments when possible, created parallel institutions when empowered, and exploited incomplete governance of multilateral institutions. At key moments during the PRC’s foreign policy reorientation, it has sought to transfer security and governance risks that could not be managed domestically to the international society and regimes. The Soviet nuclear threat led to US-PRC rapprochement in the 1970s; stalled reforms of the planned economy spurred China’s accession to the WTO; and the Belt and Road Initiative tapped new markets and resources to address structural problems of financial repression and low capital return at home. Exploiting institutional incompleteness and informal dynamics in international organisations such as the WTO, Human Rights Council, and UN Convention for the Law of the Sea, China has conducted neomercantilist economic statecraft, maintained political repression, and continued to militarily threaten its neighbours.

The coronavirus is another demonstration of China’s risk-proliferating behavior – whether due to poor governance of dangerous medical facilities or more troubling biochemical warfare developments as suggested by American FBI reports – the Chinese authority has taken risks at the expense of everyone else, including its own population. Both pandemic-afflicted states and the more fortunate ones should begin to ask questions of how the historical and ideational origins and institutional designs of our international society have created a gaping hole for the PRC to maintain an alternative logic of a “responsible stakeholder” to the extreme detriment of global commons in public health and pandemic control.


Steve Tsang, Director of the SOAS China Institute

Dr Lin is spot on that ‘the Covid-19 pandemic has exposed a fundamental vulnerability in our international society’. It is not a stretch to say how the world has approached the PRC has ended up with us facing a crisis unparalleled since the Second World War.

Where I part company with him is in seeing China as easily the most culpable party. I am not absolving the Communist Party of its conduct but I hold leaders of the liberal democratic great powers equally if not more responsible.

The CCP, from Deng Xiaoping to Xi Jinping, has not disguised the nature of its political system, though it does proactively encourage Western leaders to engage in wishful thinking.  The reality is that post-Mao China has remained a consultative Leninist system, which is fundamentally anti-democratic. Its foremost concern is to keep itself in power.  The idea that it will democratise has not been more than a gentleman’s pipe dream.

The CCP, even under Deng, has acknowledged that its foreign policy is ultimately about ‘making China great again’.  The Dengist axiom of ‘hiding capabilities and biding for time’ implies it is for a purpose.  The relative restraint of Jiang Zemin and Hu Jintao merely reflected that in their judgement, the PRC was not ready to assert itself. The big change with Xi is that he deems Beijing’s moment has come to advance Chinese control or influence. Beijing’s management of Covid-19 plays straight out of this playbook, which I have described as ‘party-state realism’.

With the pandemic potentially posing a threat to Xi’s hold to power, it is hardly surprising that Beijing’s top priority is to dominate the narrative, ahead of stopping the pandemic or containing the economic fallout.  This is reflected in the composition of the top-level 9-person committee (Leading Small Group), in which the only branch that has more than one representative is the propaganda machinery. Getting Chinese citizens to see the Party and Xi as their savior, rather than the cause of their misfortune, requires a misinformation campaign that blames the virus on the USA or Italy and fans up xenophobia against foreigners as transmitters of the virus. 

Our governments’ costly failure is to ignore what we know and treat the PRC under the Communist Party on an unrealistic basis.

We must engage with China, for the alternative will be disastrous, but we must do so with our eyes wide open, rather than on the basis of wishful thinking.

William Hurst, Professor, Northwestern University

Treating China as a “black knight”, pariah, or moral hazard can be self-fulfilling.  Marginalized, excluded, and encircled states have a tendency to misbehave. But how should status quo powers like the UK, US, or EU engage constructively with China without merely appeasing its ambitions?

In considering China’s coronavirus response, we must not forget that it is, first and foremost, a domestic issue. As such, the politics of the state’s response have mirrored longstanding trends in China’s domestic politics (as I have discussed elsewhere: There are only three ways in which international relations or foreign policy have entered into any of this.

First, China has held fast to its long-term priority of excluding Taiwan from the WHO, even when this hampered the island’s early response to the outbreak and despite potential broader harm to global public health.  Second, China has sought to counter scapegoating by other countries and the international media, some of whom have sometimes tried to cast blame for the emergence or spread of the virus on the CCP (or even on all people of Chinese or East Asian ethnicity generally).  Third, where possible China has looked to play a positive public role in helping countries from Italy to South Africa with supplies of masks or test kits or by sharing clinical experience and expertise.  Two of these are defensive moves.  The third is an attempt to exercise soft power in a way that does not challenge any existing conventions or relations (and, as such, appears far more effective than the often uneconomic or ham-fisted Belt and Road Initiative).

It is other states – notably the United States, but also Japan, the UK, and European countries – that must bear responsibility for organizations, rules, or relationships potentially becoming more “China-centric” as a result of this crisis.  It is their failure of proactive leadership that allows China to claim the soft power advantage. Scapegoating China with irrational, even racist, accusations is also counterproductive in that it bolsters China’s defensive game more generally, crowding out legitimate concerns over Taiwan’s exclusion from global health networks or other failures in such institutions.

Covid-19 is not a crisis that invites conflict or contention with China.  Rather, it is a time for cooperation against a common threat. Poking or isolating China will only induce it to morph into the moral hazard some fear it already is.

Your view…

Dylan Loh, Assistant Professor, Public Policy & Global Affairs Division, Nanyang Technological University, Singapore

Dr Lin is right in pointing out how the Covid-19 pandemic has brought China’s ‘risk-proliferating’ behavior into sharp relief. Dr Tsang is also correct in emphasizing how governments need clear-eyed understandings of Chinese behavior to better engage with them. On these two points, Chinese diplomacy in Southeast Asia during the pandemic, is instructive.

First, rather than an ‘either-or’ assessment of China’s moral fidelity, Southeast Asia’s experience tells us that Beijing’s risk-proliferating, and, in fact, cooperation-proliferating practices take place in contingent, indeterminate and emergent ways. China is not naturally pre-disposed towards exporting risk to international society.

In Southeast Asia, China has sought to drive home the point, perhaps creatively, that it is a defender, not abuser of global norms. It has also pressured countries in Southeast Asia to support and praise its coronavirus efforts, with some success. Nevertheless, Beijing has also delivered much needed medical supplies to almost all the Association of Southeast Asian Nations (ASEAN), and have sought to keep medical exchange open in a genuine bid to share information and keep the virus under control. In that way, assertive diplomacy takes place in tandem with cooperative diplomacy.

Second, countries in Southeast Asia have always viewed China perspicaciously, more so, I dare say, than Western countries. That is because we do not necessarily have the proselytizing tendencies exhibited by many liberal regimes. Of course, this is not to suggest that human rights, the sanctity of international law and so forth are unimportant but to merely point out that many regimes in this part of the world have better understandings of, and interactions with China because we do not let these hamper our observations vis-à-vis Beijing. Discussions on Chinese diplomacy and its behavior almost-always disregard non-western imaginaries. Yet, this sort of abbreviated consideration can generate more heat than light.