CKGSB website

CKGSB Knowledge

A Political Give-and-Take

by Patrick Body

April 18, 2022

The go-to Western view of China is that it is a well-oiled and highly-centralized decision-making machine. But in his book Fractured China: How State Transformation Is Shaping China’s Rise, co-authored with Shahar Hameiri, Lee Jones, a professor in international politics at Queen Mary University of London, argues that there is much more of an ebb-and-flow of power and decision-making between the Chinese Communist Party (CCP) and actors at the provincial level and beyond.

In this interview, Jones discusses top-down and bottom-up policy generation, the impact of programs such as the Belt and Road Initiative (BRI) on the behaviors of domestic and international actors, and the current shape of the Chinese system.

Q. In your book, you argue that China is no unitary actor and local politics and competing domestic interests help to shape its domestic and foreign policy behavior. Can you expand on this?
A. China does give the appearance of being a highly centralized, top-down, authoritarian system. There’s always been a certain amount of envy in the West about this system because they can just get things done, compared to the paralysis and drift that we see in a lot of Western policies. But if you look at the literature on Chinese domestic politics, sinologists have been documenting the rise of “fragmented authoritarianism” since the late 1980s, which gives a picture of the Chinese party-state as something that’s much less cohesive and coherent. There’s this massive gap between the way that specialists write about China’s internal politics, and the way that international relations scholars think about China. In this book we are trying to bridge that gap.

We focus on the way the state is evolving in response to changing sociopolitical struggles and changing political economy dynamics. What’s happening in China is not a unique process of reform and opening up and the fragmentation of authoritarianism, but it’s part of generalized tendencies that are affecting states all around the world. We theorize this as involving three kinds of transformations, first, fragmentation of state authority and decision-making, second, the centralization of power, authority and control over resources and third, the uneven internationalization of the state.

It’s not the case that the central authorities in China simply instruct lower-level agencies what to do so that those agencies are just implementation tools of top leaders. The picture is much more complex. The command-and-control system that used to exist under Mao has been replaced by a Chinese-style regulatory state, where the center is setting out quite broad and often vague directives and objectives. Then, it’s left to a range of different actors at national and sub-national levels, to work out what these things mean and implement them in practice.

The center has various mechanisms to steer these fractured actors, such as slogans and ideological campaigns, coordinating committees, the leading small groups, policy and funding support, and most importantly, the Communist Party’s own powers of appointment, appraisal and discipline. These other actors can respond to the coordinating mechanisms in a variety of ways, they can influence these mechanisms, they can try to shape emerging policy frameworks in ways that benefit them. Chinese policy, and also Chinese foreign and security policy, is not just this centralized top-down result of a handful of people at the top making decisions, it is the result of a constant process of bargaining, lobbying, accommodation, distortion and even defiance among the different interest groups that populate the party-state.

Q. Can you expand on these three different kinds of transformation?
A. They’re analytically distinct, but connected and mutually constitutive in practice. The first is fragmentation, or the dissolution of command-and-control centralized forms of authority through a constant reforming of the Chinese party-state. The number of ministries and national level actors has multiplied and attempts to reduce the number have never really worked. So, what you have is policymaking, decision-making and funding decisions being spread across multiple actors at the national level, and that is also duplicated at the sub-national level. You often find that multiple agencies have some kind of decision-making power in an area. Instead of making it very clear that ministry X controls this particular area, and everybody else clears out the way, there’s an overlapping, fragmented system of authority and control.

Decentralization is the devolution of decision-making power, authority and control over resources to sub-national government. Particularly important are provincial governments because they have a role in foreign policy now, they can manage their own external economic relations and they have been signing trade and investment cooperation agreements with governments as far afield as Africa. Sometimes these provincial governments can take a lead in certain policy areas or certain regions. Yunnan, for example, and now Guangxi, are lead agencies in the Greater Mekong sub-region and they take on a leadership role in that part of China’s foreign relations.

Finally, internationalization is where agencies that are initially created for purely domestic purposes, take on an international role. The most obvious example is state-owned enterprises (SOEs) that were formed to supply domestic markets and perform domestic social functions like employment and welfare provision have now become major international actors. Because they’re part of the state, they’re often seen as the instruments of some central plan, when generally speaking, they are now, as a result of the transformation of these enterprises, profit-seeking, independent actors.

Many agencies in China now have an international department, and they’re all, especially in the BRI era, being urged to cooperate with their foreign counterparts. The classical idea that we have of states as being relatively closed-off actors that only interact through a select number of agencies, is completely antiquated.

Q. How was this somewhat-decentralized framework created and how does it work in practice? What happens when provincial and central government goals are not aligned?
A. The decentralization process is part of China’s shift from Maoism to capitalism. You allow local governments freedom to experiment with pro-market reforms, you see what happens, and if it works, you scale it up and spread it around the country. If it doesn’t work, you junk it. There is the old cliché of Deng Xiaoping’s “crossing the river by feeling the stones,” an explicitly experimental approach to governance. That has allowed provincial and sub-provincial actors to pursue their own development objectives, some of which have an international component.

There is an attempt to develop the economy through opening up to foreign trade and investment, especially for those provinces on China’s borders. So there is an attempt to collaborate with foreign governments in those neighboring countries to open up those markets to Chinese companies to gain economic advantage. The way that it works is that the center sketches out broad objectives and frameworks, and then responsibility for fleshing that out is decentralized to sub-national governments.

Sometimes, even the central policy framework is the result of bottom-up lobbying from local governments. They’ll push for some kind of framework, like the Great Western Development campaign, which was launched at the end of the 1990s as a result of poor inland provinces lobbying for central support to catch up with the richer, faster-growing coastal regions. The center responded by creating an infrastructure-funding scheme, broad funding commitments and broad ideas about opening up across borders. Actual implementation was decentralized to provincial and even sub-national agencies. This was the forerunner of the BRI.

Q. How do you see the BRI developing over the next few years, given the conflicting signals between China’s determination to maintain the momentum of development investment in various places and also pushback from some countries around what some characterize as onerous requirements in terms of debt repayment and other issues?
A. The process of linking China to its neighbors through infrastructure projects was going on for a decade before Xi Jinping became leader, but what the BRI does is formalize and give a large-scale framework to such activities. It wasn’t until 2015 that any central guidelines were developed over what the BRI actually was, and if you study that period, you can see that there was a ferocious lobbying effort, particularly from provincial governments, to get their projects included in the BRI. Some of the provinces that were initially supposed to be included were edged out by the more sharp-elbowed ones, the number of actors involved increased substantially, and the scope of the project was transformed.

It started off as something that was seen as part of China’s so-called “neighborhood diplomacy” aimed at neighboring countries—this is why sometimes you hear the figure of about 65 countries quoted, which was true initially, and then it widened to include other countries, becoming a global initiative by 2015. This wasn’t how it was initially thought of, but it was the result of all this bottom-up influencing.

The goals are very broad—connectivity, infrastructure, growth, cooperation. There’s nothing very specific about them. So that creates a framework that many different actors can orient themselves within, and benefit from it by pursuing their own sectional objectives. The Chinese are learning quickly and trying to improve the quality of BRI projects.

Outbound investment peaked in 2017 and it’s been declining since, and that’s probably a trend that will continue to some extent. The BRI is not going anywhere, because it’s too closely associated with Xi Jinping and it’s been written into the Chinese constitution. But it will continue at a lower level, perhaps with fewer projects but of a higher quality with attempts to demonstrate commitment to sustainability goals. This is a constantly evolving framework.

Q. What are the trends you see now in terms of a “Fractured China,” geographically and in terms of economic, political or social issues in different areas? What impact do you think they’re going to have over the coming years?
A. We are not claiming that this is some kind of unilinear process towards dissolution. The metaphor I use is that it’s a tug-of-war, that there are differing opinions on where authority should lie, how much control local governments should have, where funding should be allocated, etc.

In broad terms, a sort of Big Bang decentralization was happening in the mid-to-late 1980s, which was then partially reversed in the early 1990s fiscal reforms. And then there was a more lax period where central government drifted quite a lot and then Xi Jinping came in and tightened the grip again. So there’s this dialectical movement back and forth. There are reasons why he’s done that as he comes into power, at a time when the CCP’s authority and legitimacy had been undermined by these local predatory networks that had been allowed to emerge as part of the experimental reform process. There is talk about local “mafia” states being uncovered through the anti-corruption drives, and looking at the publicly available legal documents, some local entities had been incredibly corrupt and predatory and therefore really compromised the CCP’s political legitimacy. Xi is, above all else, trying to restore and shore up the party’s power and authority by showing that he takes these issues seriously, by cracking down and reasserting the party’s central leadership and power.

The tendency at the moment is towards greater centralization, but this isn’t a change in the nature of the game itself. It doesn’t amount to a structural change in the way that power works in China, because what Xi Jinping is doing is using all the mechanisms available to him: slogans, ideological campaign, leading small working groups, the CCP’s powers of appointment, appraisal and discipline. He’s just a very strong player of that game.

Interview by Patrick Body

Lee Jones is a professor in international politics at the Queen Mary University of London, having previously worked at the University of Oxford. He specializes in political economy and international relations with much of his work focusing on China and Southeast Asia. He has recently co-authored a book with Shahar Hameiri called Fractured China: How State Transformation Is Shaping China’s Rise

You may also like

New Technology, New Choices

The adoption of AI technologies into society will disproportionately affect different sectors and raise ethical questions that need to be addressed.

by Liu Zhiyi | Aug. 5 2022

Diversified Thinking

Given the unique challenges presented by the China market to foreign businesses, the importance of strategic thinking cannot be understated.

by Edward Tse | Aug. 5 2022

Globalization in a Divided Yet Connected World

Globalization in its current form appears to be ending. As we enter its next stage, it’s important to keep some key.

by Zhou Li | Aug. 2 2022

On the Contrary

Dexter Roberts, author of The Myth of Chinese Capitalism, recommends books that suggest some contrarian views on China business.

by CKGSB Knowledge | Jul. 13 2022