The COVID-19 Pandemic and Changes Unseen in a Century The COVID-19 Pandemic and Changes Unseen in a Century Yuan Peng’ Abstract: The COVID-19 pandemic can be compared to a world war that makes the existing international order unsustainable. The pandemic is interacting with global changes unseen in a century and exerting major impacts on international politics, world economy, major-country relations, the geostrategic landscape, global governance, and development models. In the next three to five years, the international landscape will be a chaotic situation, highlighting not poles but competing states and transformation, thus making it more difficult for major countries to cooperate while medium-sized and small states have to huddle for warmth and seek a way out within their respective regions. Although further observation is required during the ongoing pandemic and worldwide economic recession, some major trends in the world have emerged. A restart to China’ s international relations is called for Keywords: COVID-19, pandemic, international order, changes unseen in a century, China and the world qT globally sweeping COVID-19 pandemic coupled with changes unseen in a century, as well as frequent Black Swans and Gray Rhinos, has shocked the international order, bringing uncertainties and instability. Affected by the pandemic, the changes unseen in a century will accelerate their evolution, or even fission on multiple fronts, pushing China’ s relations with the world to a crossroads. At the juncture of the two centenary journeys, how will China strengthen and make a decisive, well-planned step forward? * Yuan Peng is president of Cl Institutes of Contemporary International Relations (CICIR). His professional research areas include US diplomacy, China-US relations, and China's diplomacy. CIR July/August 2020 1Yuan Peng Geopolitics of Pandemic The pandemic can be compared to a world war that makes the existing international order unsustainable. In recent centuries war gave birth to a new international order. Like the Westphalia system stemming from the Thirty Years’ War, the Versailles-Washington system from World War I, and the Yalta system from the Second World War, the contours of the current international order were outlined by post-World War II events. The foundation of this order is crumbling after the post-Cold War shocks of 9/I1, the international financial crisis, and the surprise upset in the 2016 US presidential clection. US leadership and willingness to lead are declining along with US participation and power in international governance. The limited role, authority or functioning ability of the United Nations, World Trade Organization, Intemational Monetary Fund and World Bank delineate the new reality that global arms control is on the brink of collapse, the mechanism of major-country cooperation is in disarray, and international rule-based decision-making is collapsing. The pandemic has caused global mourning, brought countries to economic standstill, roiled stock markets, and caused oil prices to nose-dive. The interruption of communications and exchange, and the insults and rumors whose impact is no less than war, deal a blow to international order. The old order is unsustainable while a new one is yet to come, which is the essence of the changes unseen in a century. The world after pandemic will be much like the one after World War I when the British Empire was unwilling to relinquish leadership but the US was emerging. History recalls how Europe was busy with reconstruction, Japan and Russia were fishing for influence amid the chaos, China was beset with domesti strife and extemal aggression, and marginal forces in Asia, Africa and Latin America were at a loss, a bewildering potlatch during which the great powers divided and realigned. The Great Depression and a second world war followed. Poor Leadership The US Trump administration has indulged in selfish self-protection 2 CIR Vol. 30 No. 4The COVID-19 Pandemic and Changes Unseen in a Century rather than respond to the pandemic as world leader. Hardest hit by the pandemic, with more than 2.3 million Americans infected, the US has seen the death toll from the virus exceed 122,000. Starkly, more Americans have died in the pandemic than in World War I, and more than in 9/11, the Vietnam War and Korean conflict combined.’ The 2020 US presidential election is shaping up to be a contest between America First pursued by Trump and “regaining American leadership of the world” championed by Joe Biden. Even if Biden wins, it will be difficult for the US to regain world leadership owing to its domestic politics and external changes. Since, like Great Britain after World War I,the US remains capable of preventing other countries from overtaking it, its China policy will be touchy, tougher and arbitrary; its crackdown on China will be intensified; and the strategic game between China and the US will be aggravated. Post-pandemic, the existing world pattern featuring a superpower with many other strong powers will change. The US remains the only superpower now but cannot keep its solo dominance. China has accelerated its rising but sees a bottleneck hindering it from surpassing the US. The EU’ s overall strength is declining and its development direction uncertain. Russia strives for influence amid chaos with its international standing steadily rising. Populous India’ s rise is frustrated by its shortcomings and defects. In a bitter defeat, Japan postponed the Summer Olympics due to the spread of the virus. In the wake of the pandemic, countries have to clear up a messy situation and re-chart their development, some caught up in embarrassment for passive sleeping, some torn between expecting international assistance and hesitation to seek it. US mono-polarity is gone but China is not yet ready to establish a bi-polar world with the US, so multi-polarization will have to wait for better conditions for China. The trilateral political influence of China, the US and Russia plays the dominant role in reshaping a future world order, while Europe, Japan and India are keen on promoting their strategic autonomy. Olivia B. Waxman and Chris Wilson, “How the Coronavirus Death Toll Compares to Other Deadly Events From American History,” Time, June 17, 2020, accessed June 21, 2020, https://time.com/5815367/coronavirus-deaths-comparison, CIR July/August 2020 3Yuan Peng China’ s relationship with developing countries is being tested as Asia, Africa and Latin America suffer pandemic-triggered setbacks. The Middle East’ s prospects dimmed with the pandemic, falling oil prices and terrorism, and a possibility exists for the region to enter a Dark Age. Latin America, which had failed to speed up reform and development, missed its window to effect infectious control, and now is in political and socioeconomic chaos, and “disoriented at development direction.” Dependent on global trade and investment, the African continent has the world’ s weakest public health system; once the pandemic explodes, African countries will be trapped in a humanitarian crisis. As the BRICS fade, fence-sitters India and Brazil maneuver among the US, China and Russia. Full-Blown Recession The global economy is in a full-blown recession and only a step away from economic depression. A world that seemed prosperous, benefitting from interconnectivity wrought by globalization and IT, and generally peaceful and stable was the intemational environment during which China rose. After the 2008 intemational financial crisis exposed deep-seated problems in US and European economies and a global development imbalance, the US remedy for the crisis was not a curettage-like structural reform, but quenching thirst with a poison and laying blame upon other countries for its domestic problems. Instead of curing the chronic illness, it created more ailments. American voters’ election of non-traditional presidents Barack Obama and Donald Trump resulted from social polarization incited by economic and political malposition in the US. While the debt crisis is not over, Europe has experienced the Ukraine crisis, refugee crisis and Brexit crisis, with the European economy never picking up. “To make America great again,” Trump abandoned multilateralism, internationalism and free trade for unilateralism, protectionism, and a trade battle with China. Although the US economy and stock market rebounded through coercion and power politics, the base is hollow. There is plenty of proof for a sluggish world economy. Europe is in economic doldrums. The Russian economy is not improving. India’s economy, once a favorite, has suddenly stalled, but China’ s economy has begun to enter a new normal. 4 CIR Vol. 30 No. 4The COVID-19 Pandemic and Changes Unseen in a Century The pandemic has added to economic woe. In the first half of 2020, China, the world’ s factory and most economically dynamic East Asian country, along with the financial, tech, aviation and recreation industries worldwide, were seriously hampered by the virus. Asia, Africa and Latin America have been hurt to the bone. The major economies’ GDP dropped by 10-30 percent with unemployment about 20 percent. It is a consensus that the pandemic’ s economic downturn will far surpass the 2008 financial crisis, though people differ over whether it will slide into economic depression as devastating as that in 1929-1933. The Great Depression presaged a second world war, which paralyzed or semi-paralyzed the world economy. So far, this round of crisis is not probable to trigger a great depression in its narrow sense. It is likely to be worse than 2008 but better than 1929. However, measured by conventional standards (economic recession defined as lasting more than two years, and negative actual GDP growth exceeding 10 percent), it is quite likely the current crisis will lead to an economic depression in a general sense. What happens will largely depend on the spread of the pandemic and development of a vaccine. Research for a vaccine is inconclusive, and to go to market will take at least one to two years. During this time, the pandemic is likely to spread in India, the Middle East, Latin America and Africa, while China, the US, Europe and Japan deal with the tisk of a second outbreak. Disruption maki reintegration of the global supply chain, industrial chain and demand chain unforeseeable. As the superstructure is determined by economic foundation, national security and intemational security are based on economic security. While the pandemic lingers, economic development remains hopeless but international cooperation is suspect. It is a pity that, in the pandemic, cooperation among major countries has been replaced by competition and confrontation, badly hurting the confidence which is the most valuable for promoting economic recovery. If the G20 Summit would be duly launched and give birth to an extensive and in-depth international cooperation like what happened in the wake of the 2008 financial crisis, recovery of the world economy is not inconceivable as America’s financial system remains strong, China’s economy is remarkably resilient, and the world's major economies are fundamentally sound. However, if the US persists in trade conflict or CIR July/August 2020 5Yuan Peng insists. on mandatory backflow of industries such as _ respirator manufacturing to achieve local production and local consumption, or makes unlimited claims against China that lead to international political disorder, international trade will decline, foreign investment will shrink, and the global economy will worsen. If this is what happens, a great depression is unavoidable, which will be different only in form, degree of destruction and time duration. The G20 video summit, on the other hand, is a beginning for major economies trying to cooperate. Antagonism and Interaction of China-US There are no eternal friends, but only eternal interests. Realignment of major-country relations is an everlasting theme of international politics. This round of realignment is driven by a change in the China-US relationship, incurring new interactions among various strategic forces including China, the US, Russia, Europe, India and Japan. Results will profoundly impact the international order. American relations with China have changed. Engagement with China has given way to containment and crackdown, strategic competition, trade friction and geopolitical gaming. Amid the contest over Taiwan, Hong Kong, Xinjiang and Tibet, ideological rivalry is a new normal, The COVID-19 pandemic should have been a buffer, a relief valve or a binder for the China-US relationship, but due to all sorts of accidental mishaps, it has become a transformer, an accelerator and a catalyst that intensifies the game between China and the US instead. Although there are occasional causes such as the epidemic situation on both sides being out of syne and the emotional confrontation between the two sides, the fundamental change in US outlook toward China is that the US defined China as a major strategic rival, and is using its power to contain China. Domestic political factors in the US have added fuel to the fire. To ensure reelection, the Trump administration has lost no time to pass the buck and blame China for US problems at home while extremists smear and seek to suppress China. The Biden campaign team has joined the performance to show toughness on China. It is foreseeable that the interaction of the pandemic with the US election is likely to further worsen China-US relations. Anti-China hardliners in the US 6 CIR Vol. 30 No. 4The COVID-19 Pandemic and Changes Unseen in a Century expect hostility between China and the US to become reality. Rivalry between China and the US is unlikely to become a cold war, however, foremost because Chinese and American interests are so deeply intertwined that neither is able to bear the cost of long-term confrontation. A secondary reason is that the good old days for America’s alliance system and the Western-dominated world are gone, as evident in how the policies of Europe and US toward China are out of sync, the rift in the West is expanding with the pandemic, and China-EU relations are at their historical best. The overall China-Russia relationship is so solid that US intent to crack down on China with Russia will never happen. Japan and India can only bet on benefits from both sides. Whereas China and the US will eschew a new cold war, neither can they become two poles. What is more likely is that the US will step up building small circles to exclude China, withdraw itself from international financial, economic, trade, science and technology bodies, separate somewhat from international industrial chains and organizations, and establish new circles in fields where it can more efficiently exclude and isolate China. Meanwhile China will work at advancing its Belt and Road Initiative and its neighborhood with a shared future concept. Two economic circles, one centered around the US and one around China, are not the same as two Cold-War blocs. China and the US cannot decouple. They have to cooperate amid competition, while other countries cannot solely rely on either and have to do business with both. The China-US competition and game will not change fundamentally, no matter the results of the 2020 US presidential election. The US, Europe and Japan share interests in jointly containing China, but potential does exist for China, Europe and Japan to tap positives in future relations. Cooperation between China and Russia is driven by their strategies; the basic structure of the US-Europe alliance will be difficult to change in a short run but a gap may widen. In Asia, while the China-Japan relationship is relaxing, the China-India relationship is mixed. ‘As the US has ruined its own image, the world no longer pins hopes on American leadership. Though China has grown big, it is not strong enough, nor intends, to replace the US in a unipolar world. Russia, Europe CIR July/August 2020 7Yuan Peng and India are short on capability or will to lead the globe. Within the coming three to five years, the international landscape will feature a chaotic situation highlighting no poles, but instead warring states and transformation, thus making it more difficult for major countries to cooperate, while the medium-size and small states huddle for warmth and seek a way out within their regions. China’s relative advantage in managing major-country relations is derived from unremitting recent efforts at major-country diplomacy with Chinese characteristics and its endeavor to supply anti-epidemic public goods, US and European calls for accountability, compensation, and pressure on China will grow louder, while anti-China and anti-Communism adherents will certainly take the opportunity to make a big deal out of the pandemic. There is a high risk of China being mobbed for compensation. Grievances in several African and Latin American states have tumed outrageous, with demand for debt reduction, compensation and accountability from China, which is a new trend in China’ s relations. Future Centrality of Asia-Pacific China's rise is prelude to the eastward movement of the global power center. Its rise has stimulated a renaissance for Northeast Asia, and together with the revitalization of Southeast Asia and India's rise, make the Asia-Pacific the most economically dynamic region. After the Second World War and for some time after the Cold War, the US and Europe dominated the international order, chanting the “end of history,” trying to expand NATO eastward, and doing anything they wanted based on their economic, military and political advantages. But, since the turn of the century, particularly since the end of the Iragi War, US-Europe relations are increasingly estranged, hence widening the Atlantic. The fluctuating security situation in the Korean Peninsula, East China Sea, South China Sea and Taiwan Strait give the Asia-Pacific a high potential for military conflict. From the Asia-Pacific rebalancing strategy pursued by the Obama administration to the Indo-Pacific strategy pursued by the Trump administration, moving strategic focus eastward has become a bipartisan consensus and national policy in the US, Driven by this, 8 CIR Vol. 30 No. 4The COVID-19 Pandemic and Changes Unseen in a Century Russia marches southward, India looks east, Australia advances northward, Japan moves westward, and even Europe comes from afar. The vast Pacific has become not only very crowded all of a sudden, but also unstable. So far, the geopolitical and geo-economic significance of the Asia-Pacific have outmatched those of any other region. After COVID-19 broke out in China and East Asia, China, Japan and South Korea took a lead in controlling its spread. China, South Korea and Singapore among others achieved epidemic prevention, setting an example of the comparative advantage of oriental culture, values, collectivism, and social governance models, in a revival of Asian civilization. East Asian cooperation among China, Japan and South Korea is growing, the ASEAN+3 has been reactivated, and the advantages of the Asia-Pacific are prominent. Other regions have all been overshadowed. Post-modern Europe has seen one crisis after another. During the assault of the pandemic, the EU’ s shortcomings and defects are so obvious that people have begun to talk seriously about the EU’ s abolition, making the absence of the West a question for history. In the Middle East, the strategic vacuum left by US military withdrawal, and the inability of Russia and Europe to control the situation have agitated regional powers. Iran, Saudi Arabia, Israel and Turkey have power ambitions but it is hard for them to stand out. Negative oil prices accelerate economic malaise for the Middle East. In Africa and Latin America, countries’ comprehensive influence will fade after the pandemic. Post-pandemic, a country’ s recovery will count on its economy, supply chain and industrial chain, Asia-Pacific security is of concem to China, with the US Indo-Pacific strategy, the South China Sea and Taiwan Strait hanging out of balance. In the intensifying China-US game, China must weigh how to manage its neighborhood, the Belt and Road, and the risks of potential military and security conflicts. Globalization The industrial revolution followed by a science-technology revolution sped up globalization, Where is the tide of globalization going? With the chronic illnesses of Western liberal institutions and capitalist system CIR July/August 2020 9Yuan Peng exposed, and the efficiency, dynamics and vitality of socialism with Chinese characteristics concurrently revealed, it has more and more become a puzzle of the era to the men of insight in the West that a free market economy does not necessarily lead to Western liberal democracy. Economic globalization will not go hand in hand with political globalization as projected by Western strategizing. Uncoordinated with domestic policies, economic globalization would mean uneven development. Unless emphasized and mended with structural reforms, such an imbalance will intensify domestic social conflicts, and boost protectionism, populism, isolationism and adventurism abroad. The “Trump phenomenon” is a result of how the US has failed over the past 20-odd years to shape itself to conform to globalization and multi-polarization. Measures Trump took in his term do not prompt America to adjust in the direction of globalization but oppose it with trade protectionism, decoupling with China, and calling on industries to backflow. US leaders have failed to resolve deep-seated structural problems and created international tension. Globalization of economy, information and resources should have corresponded with global governance, but shortages in funds, personnel and authority, and a shaky economic foundation are the upshot. During past international financial or economic crises, the IMF and the World Bank had limited roles as compared to central banks of various countries. As a result, countries of the world have raced to adopt ineffective financial stimuli and tax cuts. The pandemic wams that each country has to reconsider the importance of global govermance. The US, among other nations, may incorrectly treat COVID-19 as the fault of globalization. Redoubled efforts against globalization might narrowly identify “localization” and “regionali fion” of relevant industries as the right way or actively drive industry backflow, rather than seek cooperation over medical supplies and other problems. It is only adding insult to injury to de-invest in WHO and denigrate the World Trade Organization (WTO). Globalization is the historical trend. The few politicians going against this tide are overrating themselves, The final results of the pandemic are yet to unfold, but threats of “decoupling” and “industry backflow” are easier said than done and will be punished by history. It is the right choice 10 CIR Vol.30 No.4The COVID-19 Pandemic and Changes Unseen in a Century for China to advocate community with a shared future, the BRI, free trade and multilateralism, and to promote such with resolve. As for global governance that the West used to admire but now tries to dump or is incapable of maintaining, China may use the old bottle for new wine, enriching and perfecting it on levels of theory and practice so as to raise its international discourse power and influence. Contention over Ideology China’ s rise is the most outstanding change in international politics after the end of the Cold War. The growing maturity and confidence of socialism with Chinese characteris is reflected in its rise. By contrast, the West is fading away, the capitalist system is riddled with ills, and the liberal international institutions it dominates are collapsing. Ideological and institutional struggle between the US and Soviet Union has evolved into a contest between Chinese and the US development paths and models. The change in US strategy toward China is intended to cope with China’ s rise and contain the shock brought about by China’ s development model on Western freedom and democracy. Such anti-China celebrities as Mike Pompeo, Peter Navarro, Steve Bannon and Newt Gingrich keep their anti-China ideology on slow burn. Since “Made in China 2025,” government subsidies to state-owned enterprises, and China’ s structural reform are targets of the US-China trade conflict, the dispute seems aimed at institutions or politics. The signed first-phase agreement between the two was a window phase for a temporary truce, but COVID-19 upset that. China has rapidly controlled infection and resumed production by providing centralized leadership and unified command, taking concerted actions, combining central and local efforts, encouraging mutual assistance, giving full play to public health facilities, strengthening community management and putting people first, which manifests China’ s unique institutional advantages in sharp contrast to the shortcomings exposed in American and European institutions in the form of partisanship, over-liberalization and political polarization. The West is unwilling to acknowledge its system decline and policy failure. It indulges in tarnishing CIR July/August 2020 ulYuan Peng China’ s image to cover up its shortcomings, accusing China of hiding facts about the pandemic, of fulfilling its geostrategic ambition by conducting epidemic diplomacy, and of boasting about ideological victory, just as some Western media claimed COVID-19 prompts a strategic contention between China’ s model and the Western model. If so, it would be a misfortune for international politics. As a matter of fact, institutions or systems vary in advantages and disadvantages. China will never sell its model nor accept Western models. Chinese responses to the pandemic gave full play to the power of science and technology. China could stabilize and control the situation using its scientific advances which include big data, health code, express delivery, a central epidemic information system, data chain for tracing, central e-payment system, and grid management. China’ s comparative advantages are bound to prompt the West to try to adjust, but public opinion, the ballot box, and the absolutism of liberty and human rights will intercept its best efforts. The US will speed up its sci-tech decoupling with China to hold back Chin: doubt step up accusations against China over technology ethics and digital science and technology advances, and will no monitoring issues. Contention and competition in advanced technology fields will become a central plank for international politics in the coming years, in a parallel to an arms race. Restart of China’s Relations China is not what it used to be. China had been bullied and humiliated while trying to stand up and while fighting for respect. Such a bitterness in China’ s relations with foreign countries is only best known to the Chinese people. With China continuing to rise, coupled with its economic prosperity, political confidence and strategic initiative, China’ s relations now can change. In short, the world is not what it used to be either, as China advances from major country to strong power. At the moment, China’ s relationship with the world features mutual bending, deep linkage and interaction, but China is turning from its past tack of one-way merging into the world, to mutual shaping of it. Merging with the world is not the final 12 CIR Vol.30 No.4The COVID-19 Pandemic and Changes Unseen in a Century goal. China wants creative involvement and constructive pioneering. Since the 18th Party Congress, China has a closely-knit five-pronged strategic framework, taking ideological win-win as base, peaceful development as strategic choice, the Belt and Road as means, building a new type of international relations as a phased objective, and community with a shared future as ultimate pursuit. Instead of observing the change in China’ s international relations from a progressive historical perspective, the US anticipates China’ s involvement in and guidance of the world with strategic vigilance, thus prompting the US to use high pressure to block and contain China. Some, like Steve Bannon, visualize the Belt and Road as a mixture of geostrategies with which China is to realize its global ambition. China’ s charitable assistance in the pandemic has been stigmatized as using the epidemic to achieve its geostrategic goals. This calls for a restart. As the pandemic made the changes come more quickly and more violently, China’ s foreign relations are more complex and multifaceted. China was the first to come out of the darkest and most arduous moment of the pandemic and resume production. As seen at the National People’ s Congress and Chinese People’ s Political Consultative Conference, strategic deployment is advancing. The critical point is whether China is able to do its own things well while the rest of the world is mired deep in the catastrophe that follows the pandemic. While doing what it can to provide public goods, China will restart international relations and achieve great national rejuvenation. China has to unswervingly advance reform and opening up in the new era, not give up halfway. We have to get ourselves together so as to go into the battle with a light pack. As the first centenary goal is drawing to a close, we need to pause to sum up experience, learn lessons, and create rules and conditions conducive for us to sprint for the second centenary goal. Putting off preconceptions in favor of facts will allow China to sort out, regulate and guide in a timely way the current collision of thought from left and right in the new era. Without unity of thought, it would be exceptionally difficult to meet the second centenary goal. A balance CIR July/August 2020 13Yuan Peng between development and security is vital. The biosecurity issue revealed by the virus pandemic, coupled with national security concerns, indicates development must be ensured by security, otherwise we could run the risk of seeing development gains wiped out. Development is, of course, the absolute principle, but the development after 40 years’ reform and opening up must be prefixed: only safe development counts (edited by Zhao Jinfu) 14 CIR Vol.30 No.4The Future of Globalization under the Impact of COVID-19 Pandemic The Future of Globalization under the Impact of COVID-19 Pandemic Fu Mengzi™ Abstract: China will continue to be an active participant and promoter of globalization. While the coronavirus epidemic may be a watershed in the process of globalization, in the post-pandemic period China will speed up its domestic circulation and prioritize regional circulation of neighboring countries. Globalization’ s pace will not halt over the long run. Rather, its renewal after the pandemic will trend in ways that meet expectations. Keywords: globalization, coronavirus, pandemic, industrial chain T™ spread of COVID-19 in 2020, a most serious global crisis, has had profound and comprehensive impacts. The world will witness shifts, changes and transitions since many countries and regions have been affected. According to the World Health Organization, by July 6 there have been more than 11,3 million coronavirus cases and over 500,000 deaths worldwide.’ A question arises as to how this crisis will affect the trend toward economic globalization. The End of Globalization? Economic globalization has improved resource allocation, the international division of labor, and human welfare. For the last five hundred years, while capitalists made use of globalization to promote economic growth, globalization characterized by marketization, liberalization and privatization has gained unprecedented momentum. The US has been a leader in globalization, but rising economies’ opening up and rapid economic development increased globalization’ s vitality. With concomitant industrial Fu Mengzi is vice president of CICIR. WHO Coronavirus Dashboard, accessed July 6, 2020, https://covid19.who. int. CIR July/August 2020 15Fu Mengzi outsourcing, wealth gap, social division, and immigration problems, some countries ost momentum in the process. Since the 2008 financial crisis, the emergence of populism, protectionism, deglobalization and anti-globalization has seen the US retreat from its globalization lead. The world is entering a time of “slowbalisation.”' With many factories closed, international travel shut down, and countries and cities suspending transport and movement, COVID-19 has severely disrupted global industrial chains and prolonged the social distancing. Many now doubt, hesitate over, or blame globalization. That the free flow of production factors in the near future could remain paralyzed and the familiar patterns of globalization might end are predictions some do make, extrapolating from the effects of the cri: Strategic elites differ in their opinions. Some, including US former secretary of state Henry Kissinger, argue that the pandemic will forever alter world order. Others assert that COVID-19 will create a world that is | world may see the demise of globalization.’ s open, less prosperous, and less free,’ that a post-coronavirus The coronavirus will directly affect globalization despite some people’ s optimism for globalization’ s positives. Without a doubt, the rhythm and the form of globalization will be different, post-crisis, The global industrial chain will see a restructure, factories will move back to their country of origin, and regional cooperation will step up. The inevitable restructuring of the global industrial chain, a natural outgrowth of globalization, will be forced by updates where international industrial division is more delicate, the technology more intensive and the cost lower, Under these circumstances, the industrial chain will be longer and larger. Where factory shutdowns and logistics control break the industry chain, it will be imperative for businesses to shorten the chain or locate it closer, with some businesses moving their outsourced factories Kate Jones, “Goodbye Globalisation, Hello Slowbalisation,” August 7, 2019, accessed July 1, 2020, httpthebalicbriefing,.comvmagazine/goodbye-globalisaton-hello-slowbalisation. > Stephen M. Walt, “Is This the End of Globalization: A World Less Prosperous, Open and Free,” Foreign Policy, March 20, 2020, accessed July 6, 2020, http:/foreignpolicy.com, Kenneth Rapoza, “The Post-Coronavirus World May Be the End of Globalization, Forbes, Mpril 3, 2020, accessed May 10, 2020, https:/vww.forbes.com/sites/kenrapoza/2020/04/03 ‘the-post-coronavirus-world-may-be-the-end-of-globalization/#22bed2de7e66, 16 CIR Vol.30 No.4The Future of Globalization under the Impact of COVID-19 Pandemic back to home country. The shortage of face masks and respiratory machines laid bare medical manufacturing’ s exposure. Reports of out-of-stock situations and tighter availability of medications for chronic diseases numbered about 600 in 2018; this had doubled to about 1,200 reports the following year, 2019. For Europe, Asian countries’ share (80%) of pharmaceutical raw materials were found to be primarily from China and India. China supplies 60% of paracetamol and 90% percent of penicillin worldwide. Almost three-fourths of facilities producing pharmaceutical ingredients for US consumption are located abroad—mostly in the European Union, India and China.' They found themselves excessively dependent on the global supply chain. To avoid overwhelming dependence on the global supply chain, the US administration has decided to cut off reliance on external supply for medical equipment to ensure medication security. The Trump administration has encouraged American overseas businesses to revive US manufacturing and bring back factory jobs. Donald Trump even orders US businesses out of China. The US and Japanese governments have promised to pay the moving costs of returning American companies. The EU has adopted local procurement politics and will reduce dependence on trade. To ensure economic sovereignty and manufacturing independence, some governments have pushed to create low-profit businesses, specifically in health, medical care and hi-tech industries. Regional cooperation matters more than globalization. Given political and security interests, a single market is not the prioritized objective for major powers despite global gambling for more economic interests. The US will decouple from its competitors, and reduce economic and financial reliance on them, to maintain hegemony. A value-oriented economic partner system is more welcome for the US. Rivalry with China is a common strategy of the two main US political parties. The pandemic and November presidential election have amplified Sino-US tension. Joseph Biden, the US vice president, 2009-2017, now a Democratic Party candidate, argues, Richard Fontaine, “Globalization Will Look Very Different after the Coronavirus Pandemic,” Foreign Policy, April 17, 2020, accessed May 10, 2020, hitps:/foreignpolicy.com 2020/04/17/globalization-trade-war-after-coronavirus-pandemic, CIR July/August 2020 "7Fu Mengzi “The United States does need to get tough with China. ....To win the competition for the future against China or anyone else, the United States must sharpen its innovative edge and unite the economic might of democracies around the world...even as we seek to cooperate with Beijing on issues where our interests converge, such as climate change, nonproliferation, and global health security.”' Meantime, China and other rising countries adhere to globalization. Some predict that there will be two systems, one each centered on the US and China. Countries will emphasize regional cooperation and guard against supply chain extension. A joint statement issued by the ASEAN+3 summit on coronavirus disease advocated Asian countries cooperate in fighting the virus, promote regional integrity, coordinate policies, and run smooth supply chains. With regional cooperation taking priority, globalization must transition. Almost every post-Cold War nation participated in global competition and cooperation once marketization, liberalization and privatization took hold because thereby they improved resource allocation, reduced production costs, joined in the international division of labor, or promoted social tion. welfare. They underwent reform or opening up to embrace global The upcoming transition of globalization will mean emphasis on how to participate in globalization, how to balance society and market, and fair competition between state-owned and private enterprises. Globalization has resulted in social divisions in countries which have become losers at globali: ion. Now, profit motive and social development should be balanced. Society and market should be coordinated. An overall plan taking into account majorities’ requirements is necessary. Most countries will benefit. Win-win cooperation will empower globalization. “At the same time, we will need to work towards eliminating problems such as social and economic disparities caused by globalization,” said Mie Oba. Otherwise, the outbreak of coronavirus will push countries affected by nationalism inward.’ Joseph R. Biden, “Why American Must Lead Again Rescuing U.S. Foreign Policy after Trump,” Foreign Affairs, March/April 2020, 71 * Mie Oba, “Coronavirus and the Future of Globalization—The Pandemic May Exacerbate an Existing Tendency for Countries to Tum Inward,” Diplomat, March 18, 2020, accessed May 10, 2020, https://thediplomat.com/2020/03/coronavirus-and-the-future-of -globalization’. 18 CIR Vol.30 No.4The Future of Globalization under the Impact of COVID-19 Pandemic The main theme of human development is competition, which requires a tolerant, fair environment. Developed countries, early proponents of fair trade, if now unwilling to allow developing countries to share benefits or reluctant to accept the developing countries’ transitional arrangements, ask a high price when demanding developing countries like China turn into developed ones. Indeed, it is inequality. Rising economies will establish new rules emphasizing the justice of international economic rules. The rule restructuring requires global consensus and the tolerance of developed countries. Otherwise, there is long-term gambling to achieve just rule in competition. The role of state-owned and private businesses in promoting economic growth should be strengthened. On the 2019 Fortune Global 500, China-based companies were a record 129, outnumbering the 121 US-based companies for the first time, and far more than the four Chinese companies listed in 1996, signaling a significant global power shift.' Chinese businesses experiencing global competition updated industrial restructuring and demonstrated innovation and vitality since China’ s accession to the WTO. In newly emerging countries, enterprises, mostly nation-owned, are growing. The West always believes nation-owned enterprises to be backed by beneficial goverment policies advantageous for their funding, tax breaks, and procurement discounts. Some claim that foreign state-owned enterprises “enjoy unfair advantages over private business” and Western private businesses are economically disadvantaged.’ For national security reasons, Western governments press against the investment of SOEs and some private businesses in competing countries. As Western countries could not abandon both state-owned and private enterprises, China could not abandon them. Western state-owned enterprises primarily operate in the domain of electric power, post services, railway, insurance, and oil; the US Alan Murray and Katherine Dunn, “China Takes Lead in Fortune Global 500: CEO Daily,” Fortune, June 22, 2019, accessed June 8, 2020, https://fortune,com/2019/07/22 Ichina-takes-lead-in-fortune-global-500-ceo-laily. ? Renato Mazzolini, “Are State Owned Enterprises Unfair Competitior Management Review, December 1, 1980, accessed June 8, 2020, hitps:/jourals. sagepub.com Hdoi/pd!10.2307/41164913. CIR July/August 2020 19Fu Mengzi Postal Service is on the Global 500. British and French state-owned enterprises’ fixed assets are far more than those of the US. Both state-owned and private enterprises are very small parts of the world economy. All the foreign companies should be treated equally. The discrimination and repression are not right approaches to develop entrepreneurial capacity, restructure the world economy and build modern economic order. SOE development, for people’ s basic living, will be encouraged and supported in many countries. China and Globalization China’ s participation in globalization was dependent on policy option and external environment. The economic blockade and threat of Western capitalist countries forced China to join the former Soviet Union bloc socialist market system and establish economic exchanges with developing countries and some developed countries for a long time after the PRC’ s establishment. In 1972, US President Richard Nixon’ s visit to China resulted in diplomatic relations between the two countries, and China established diplomatic relations with many developed countries since then. After the Third Plenary Session of the 11th Central Committee meeting in 1978 and reform and opening up, China formally joined in globalization, building special economic zones in Guangdong and Fujian to attract foreign investment. Chinese enterprises that process imported raw materials, manufacture products according to imported samples, and assemble imported parts and those enterprises that repay loans for imported equipment and technologies with products, would participate in international economic cycles and accept external industrial transfer. Moving in line with the international economy involved regionalization and globalization, Because it launched reform and opening up ten years earlier than the former Soviet Union, Eastern Europe and other developing countries, China was well-positioned for the significant opportunity within globalization. When markets unified, post-Cold War, China deeply engaged in economic globalization, Membership in WTO, corporate mergers, and restructuring accelerated Chinese business development. After the 2008 financial crisis, the West ceded the role of global trade champion as China and emerging economies led the globalization 20 CIR Vol.30 No.4The Future of Globalization under the Impact of COVID-19 Pandemic wave. As the second largest economy, China has contributed 30% of world economic growth and now is the major motivator for globalization. The coronavirus epidemic has hit China’ s economy, with growth having dropped by 6.8% in the first quarter 2020 for the first time in four decades, and a significant fall in its annual economic growth expected. Strict measures to control the coronavirus are effective for economic recovery and development. The coronavirus will not bar China from participating in globalization, nonetheless, even while the world economy encounters uncertainty and turbulence during political gambling. Since foreign trade fell as the virus spread, it will take longer than expected to rebuild global production, logistics, and value chain. The external environment of China’ s economic growth is severely affected. China’ s President Xi Jinping argues we should stick to bottom-line thinking and be well-prepared for changes in the external environment in the face of coronavirus crisis and economic fallout. China’ s priority is to ensure an unhindered cycle among industry chain, market and economic society. We should put more emphasis on regional coronavirus control and economic integration. China’ s government should further ease tariffs, eliminate barriers, boost the trade and investment flows, and keep markets open to restore growth in East Asia. China should maintain necessary people flow and logistics and stabilize the production supply chain. “We also need to work toward signing the Regional Comprehensive Economic Partnership (RCEP) agreement within the agreed time-frame, and speed up the Trilateral FTA negotiations to enhance regional economic integration,” said Premier Li Keqiang in April As the largest manufacturing and trading country, China has become the main destination of international investment. The development of “Zhonggong zhongyang zhengzhiju changwu weiyuanhui zhaokai huiyi Xi Jinping zhuchi [President Xi Jinping chairs the Standing Committee meeting of the Political Bureau of the Communist Party],” Xinhuanet, April 8, 2020, accessed May 10, 2020, http://www.xinhuanet.com/politics/leaders/2020-04/08/c_1125829634.htm. > “Li Kegiang chuxi dongmeng yu zhongrihan kangji xinguanfeiyan yiging lingdaoren tebie huiyi [Premier Li Keqiang attends special summit of Association of Southeast Asian Nations, China, Japan and the Republic of Korea (10+3) on COVID-19] vvia video link,” April 14, 2020; hitps:/inews. cgin.com/news/2020-04-14/ ASEAN-China-Iapan -ROK-special-summit-on-COVID-19-starts-PGnkYbiNP2/index. html. CIR July/August 2020 21Fu Mengzi China is inextricably linked to globalization. China offers medical equipment and sends medical personnel to many countries. China’ s return to work is good news for the economy, but difficulties cannot be eliminated soon. The shrinking market and hindered land and marine transport make it more difficult to protect, mend and build a supply chain. With substitutes of products and industry looking for new positioning, innovative industry should be encouraged. Since post-coronavirus globalization could not be restarted in a rush, step-by-step approaches in domestic, regional and global markets are going to be more effective. The Destiny of Globalization From the perspective of the overall history of world development, the basic trajectory of people’ s living, production and development is from closure to opening up, from isolation to exchange. It is too early to predict that the coronavirus outbreak will change globalization forever. Admittedly, we will witness more changes after the pandemic as people travel back to cities from their hometown or village, but it will not last forever. In the crisis, the lack of external assistance from other countries may bring humanitarian disaster from food crisis and climate change if they cannot be supported by other countries. Unless we join forces, we all remain vulnerable. Now that artificial intelligence, the Internet of things (IoT), cloud contact, internet finance and net meeting systems have expanded the scope, space and form of human interactions, there is opportunity for globalization to update. It is also too early to say that globalization will bring division and fragmentation after the crisis. An article in the Economist said, “A more nationalistic and self-sufficient era beckons. It won’ t be richer—or safer... The way to make supply chains more resilient is not to domesticate them, which concentrates risk and forfeits economies of scale, but to diversify them. Moreover, a fractured world will make solving global problems harder.”' US president Donald Trump has threatened to pull the US out of “Goodbye Globalisation—The Dangerous Lure of Self-sufficiency,” Economist, May 16, 2020, 7. 22 CIR Vol.30 No.4The Future of Globalization under the Impact of COVID-19 Pandemic WTO, WHO and the United Nations, but US allies do not support it. China, the EU and 17 other WTO members issued a joint statement to create a new international trade system, Multi-Party Interim Appeal Arbitration Arrangement (MPIA), due to the ceased functions when the US made an obstruction in the appointment of new judges in May 2020. The US has constrained Chinese companies with the excuse of national security and intensified pressure on the UK, Australia and Germany to avoid Huawei and ZTE. But the US did not receive support from its allies. An article in the Atlantic magazine pointed out that America is alone in its Cold War with China.’ That the US has started to draft rules to allow Huawei and US companies to work together on 5G standards reflects that the US has to face reality and cannot harm its own interests despite competition with China. As the coronavirus spreads, multilateralism has even accelerated its development and any single country cannot dominate the globalization. Harvard scholar Graham Allison, author of Destined for War: Can American and China Escape Thucydides’ Trap?, writes that with unipolarity over, the US will need to share the world because there are many spheres of influence.’ The evolving technology and updated rules push forward globalization. Different countries should seek common ground in a multipolar world. As the largest consumer country, China has the potential demand of a large population which will promote economic recovery and future globalization. The collective hope of the international community is to see how China’ s leadership can save globalization. In the Financial Times, the editorial board wrote that, “China should stand up to revive global demand ....Beijing could show leadership by running current account deficits.”” A French scholar said China is the only country to save globalization. It is also in line with China’ s proposal in building a Community of Shared Future for Mankind. Future globalization is a high-quality globalization, not simple Uri Friedman, “America Is Alone in Its Cold War with China,” Atlantic, February 2020, accessed June 12, 2020, https:/www. theatlantic, com/politics/archive/2020/02/us -china-alles-competition/606637 2 Graham Allison, “The New Spheres of Influence—Sharing the Globe with Other Power,” Foreign Affairs, March/April 2020, 30. » “China Should Stand up to Revive Global Demand,” Financial Times, March 29, 2020, accessed May 10, 2020, htps:/www.ft. comvcontent’ | 9ffca2-7030-1 Lea-89df4 Ibea0557206, CIR July/August 2020 23Fu Mengzi expansion, and calls for quality global governance. Some scholars are pessimistic about international cooperation, post-outbreak. Harvard University’ s Stephen Walt said, “What won’ t change is the fundamentally conflictive nature of world politics. Previous plagues—including the influenza epidemic of 1918-1919—did not end great-power rivalry nor usher in a new era of global cooperation. Neither will COVID-19.”" However, we should be committed ourselves without any concession, exclusion and malevolence for common progress. In the process of globalization and global governance, any political manipulation is like poison. Fragmentation and exclusion will undermine the interests of all parties. The coronavirus is the common enemy of humanity, What China does for controlling the virus wins time and offers more faith for other countries. China also strengthens international cooperation. President Xi Jinping outlined at the G20 Extraordinary Virtual Leaders’ Summit on COVID-19 that, “It is imperative for the international community to strengthen confidence, act with unity and work together in a collective response. We must comprehensively step up international cooperation and foster greater synergy so that humanity as one could win the battle against such a major infectious disease.... I am convinced that through solidarity and mutual assistance, we will prevail over this outbreak and we all will embrace a brighter future for mankind.”* China has made efforts to smooth the domestic and regional supply chain, which strongly supports economic recovery. As globalization makes China more closely interrelated with the outside world, China is the participator, advocator and promoter of globalization. Thanks to globalization, China’ s economy has grown rapidly, but China has also encountered shocks from international liquid capital, and experienced environmental degradation and industrial transfer. Foreign countries are discriminating against Chinese companies. We should make use of globalization but bypass its disadvantages. The pursuit of human development is openness, inclusiveness, mutual benefit and win-win Walt, “A World Less Open.” Xi Jinping, “Xieshou kangyi gongke shijian—zai ershi guo jituan lingdaoren tebie fenghui shang de fayan [Xi’s remarks at Extraordinary G20 Leaders’ Summit],” Guangming Daily, March 27, 2020. 24 CIR Vol.30 No.4The Future of Globalization under the Impact of COVID-19 Pandemic progress. China will endeavor to revive a healthy, secure, equal, mutually beneficial, coordinated globalization and build a community with a shared future for mankind. (edited by Zhang Yimeng) CIR July/August 2020 25