The Best Way to Counter China’s Global Influence? A Coronavirus Marshall Plan
By: Ricardo Teixeira-Mendes
Tags: Foreign Policy, Covid 19, Politics, Geopolitics, Global Development

Global investment on the scale China has done in ‘normal’ times makes economic and geopolitical sense

Since the Great Recession petered out in the 2010s, analysts and commentators alike have made efforts to try to predict the next big global recession — few anticipated it would’ve come in the form of worldwide pandemic on a scale not seen for a century. Not dismissing the still increasing death toll, which has now reached an estimated 1 million worldwide, the economic consequences of the spread of the virus (and humanity’s efforts to effectively contain it) is already leaving a battered and bruised global economy, particularly for the world’s poorest, leaving a worldwide fall of GDP not seen since the Second World War. Winning the current World War against COVID-19 is our top priority, but with vaccines almost ready for deployment, it is now time to start planning for the peace. This peace, like the one after the Second World War, will be contested and fought between the world’s great powers and cannot be left solely to autocracies like China without any qualms to act decisively.

Immediately prior to (and during) the pandemic, increasing tensions between China and the West typified much of geopolitics; many cleavages of dispute such as the Hong Kong Protests and the so-called “Xinjiang re-education camps” of Uighur Muslims have allowed Western counties to erupt in vocal opposition following simmering tensions regarding much more long-term trends, particularly Chinese global investment. For decades since China’s 2001 accession to World Trade Organisation, China’s economic clout was often viewed in isolation of its geopolitical aims, with the hope that an increasingly marketised and internationalist China would fold into Western norms of liberal democracy. To anyone but the most eagle-eyed observers, China seems no closer to democratisation than twenty years prior, despite the advent of social media and increasing internet access within the People’s Republic. Western countries have been more aware in recent years how, rather than being a tool to weaken the Chinese Communist Party, global capitalism has given far more avenues of influence than it held prior. The blocking of Huawei investment in UK 5G networks as well as the recent US ban on apps such as TikTok and WeChat are symptomatic of this relatively recent Western realisation.

A globally engaged China is one which has been winning new, unlikely allies across the world. Considering that only a few decades prior, many of these newfound allies were Western colonies or had explicitly pro-Western governments, it could appear shocking that when a crunch vote on the Xinjiang camps appeared before the UN, China had more than double the backers of Western countries, largely thanks to African and Middle Eastern countries heavily dependent on Chinese investment :

Nations that expressed support (green) or opposition (red) towards the Xinjiang re-education camps, at the United Nations in October 2019. (Some nations have withdrawn support since that time.)

As it stands the West appears outgunned by China, namely because the developing world does not have a large guarantor or investment to directly compete with the Chinese state. Despite the best efforts of the World Bank and the International Monetary Fund, the kind of acute and sometimes unprofitable investment in developing countries creates a dependency on China of which there is sadly no major alternative.

Following the Second World War, the United States was concerned about the highly potent pro-communist sentiment brewing in war-torn nations across Europe, even within neutral countries such as Portugal and Sweden, with the fear of that Soviet aid would allow Europe to embrace communist influence and ultimately weaken democratic institutions — as well, of course, American market access. In response the United States started a major European Economic Recovery Plan, the Marshall Plan to secure both European economic recovery and US geopolitical interests. In the face of a need for a post-pandemic recovery, the West today luckily does not share the 1940s risk of shut off markets, but maintains the same risk as then of undermined nascent and weak democratic institutions in hard-hit nations as well as losing geopolitical allies in opposition to human rights abuses and territorial expansionism from an autocratic superpower.

As was obvious in the late 1940s, it is therefore imperative that democratic Western nations, with clear signposting and fanfare, commit to a similar amount of investment in the now intensely struggling developing world — combining both economic support and aid goals into a cohesive and unified strategy in the form of a post-COVID-19 Recovery Plan, much like the Marshall Plan.

The post-COVID-19 Recovery Plan, ideally, should function as a temporary institution of joint cooperation between the European Union, United States and the major developed democracies of the Commonwealth (as well as others such as Japan and South Korea). A central fund, with proportional contributions according to economy size, would be formed by member states delivering economic and (crucially) healthcare aid and infrastructure to the most impoverished countries globally. Although the member states’ own finances are of course also battered by the effects of the pandemic, low borrowing rates and an enormous international consensus would allow financial institutions to be confident in this plan at a time the world needs it most. Following an era where Western global leadership has been divided and left to individual private investors and NGOs, a post-COVID-19 Recovery Plan would, at the very least, restore the prestige and soft power of Western democracies in the face of Chinese expansionism; far from being the home of faceless individual financial and aid institutions, Western countries would again appear to be a reliable ally to the developing world who have increasingly seen China as a strong beacon for support.

This article is not written to convince readers of the economic benefits of large-scale recovery plans, lord knows how much literature is expended on the pitfalls of Roosevelt’s New Deal and the Marshall Plan, but detractors rarely, if ever, discount the immense political capital that schemes of this magnitude can reward. Even in the face of potential accusations of Western ‘neocolonialism’ or predatory practices, the current existence of these accusations regarding China’s much more contentious forms of investment (and its inability to realistically stick in the minds of its recipients) only proves that any realistic backlash to a Western recovery plan in recipient nations is unlikely to materialise. Indeed, the immediate introduction of the Marshall Plan drew some sharp criticism, and yet despite this, nations such as France and Germany eventually became strong allies of the United States in opposition to the Soviet Union. Contextualising this to today, simply the option of a single, large Western backer as an alternative to Chinese investment would be enough to help sway developing countries towards more liberal and democratic goals, particularly as tensions with China rise.

Even with inefficiencies, a Recovery Plan would help stop the resurgence of COVID-19 in developing countries (including conflict zones) where due to a lack of sufficient healthcare infrastructure, COVID-19 risks running rampant much after the distribution of vaccines and relative herd immunity in the developed world. The plan also allows Western democracies to ramp up the kind of trade and aid that has already lifted millions out of poverty over the last several decades — ending extreme poverty a little faster, at a cost, is still a noble goal regardless of geopolitics or value for money.

The costs of inaction appear much greater than any short-term fiscal loss, economic inefficiencies or immediate political backlash. The fate of millions of the world’s poorest hangs in the balance as humanity finds its way out of the pandemic. The democratic nations of the world could, as they have done for the last 20 years, choose a laidback and splintered role in global affairs, or it could seize this moment to provide sorely needed economic support and united leadership at a time where the world’s poorest have already begun to turn towards autocracies for help instead.