2017 year in review

In 2017, Xi Jinping moved China closer to one-man rule while most of the world maintained an uneasy holding pattern in light of a diminished American presence. Many of China’s developments center on the theme of control. Domestically, the subordination of all corners of society to the Party continued. Abroad, what some consider an ethnonationalist foreign policy gained greater definition. China is no longer “hiding its light” and is unapologetic about the prerogatives to which it believes itself to be entitled.

Under collectivist rule, the Party allowed a degree of purposeful incoherence to accommodate the great ideological differences on its path from Mao to the market. This created a modest space for debate and afforded those who sought change a place within the system. Xi is signaling that it is now decisiveness that is needed, even though the ideological differences have in many ways only become more pronounced. There are two interpretations of Xi’s push for decisiveness. One is of a country moving triumphantly towards supremacy. The other is of a country racing against time to seize what it can before growth, the basis of its strength, is exhausted.

In tying the Party closer to his person, one can no longer disagree without doing so with Xi personally, risking the alienation of those who sought change within the system. Xi has, perhaps fatefully, greatly linked the survival of the Party to his own mortality.

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Politics

At the Nineteenth Party Congress Xi Jinping was confirmed for another term as the leader of the governing Communist Party without a clear successor. Xi has been symbolically elevated to be on par with Mao and Deng, confirmed by the inscription of “Xi Jinping Thought” into the party constitution. Wang Qishan, who led Xi’s anticorruption campaign, stepped down but is expected to continue to play a role in government. His replacements on the Standing Committee confirm a shift away from collectivist rule.

The sweeping anti-corruption crackdown continued, ensnaring a billionaire abducted from Hong Kong, generals, politicians, and even its former Internet regulator. Moves to formally grant the Party extrajudicial powers encountered a surprising level of dissent. Exiled in New York, Guo Wengui, a businessman, released a steady stream of thinly sourced allegations at senior Chinese officials. By year end, Facebook had blocked his account.

The situations in Xinjiang, Hong Kong, and Taiwan all worsened, with relative degrees of severity. In Xinjiang, repression reached new heights as passports were seized and ethnic Uyghurs abroad were ordered home. In a new campaign, the government has begun to aggressively collect the DNA of residents.

Celebrations of the 20th anniversary of Hong Kong’s return to the mainland belied the continued disaffection of the territory’s young people and suspicions that “one country, two systems” is being slowly eroded. The selection of Carrie Lam as the territory’s chief executive was consistent with Beijing’s wishes, but not the majority of Hong Kongers. Pro-democracy lawmakers were unseated on technical grounds. Low-level protests of the national anthem and on campuses played out, setting the stage for potentially larger clashes should the government pursue a controversial national security law.

In Taiwan, president Tsai Ing-Wen’s continued refusal to recognize “one China” was met with intimidation by the mainland. Donald Trump quickly retreated from his provocative call with Tsai after his election and was warned by Xi during his fall visit that it was the most important issue of the bilateral relationship. Panama switched its diplomatic recognition from Taiwan to Beijing. (A majority of Taiwanese believe it to be an independent country; 166 countries offer visa-free entry to Taiwanese passport holders versus 21 for China.)

US-China relations

The US-China relationship avoided the most dire predictions that followed Trump’s election. (Indeed, many Chinese like him.) In April, Trump hosted Xi for a summit at his Florida golf club, where a 100-day action plan on trade was announced but ultimately proved to be fruitless. As the year progressed, the United States made preliminary moves to back-up Trump’s demands for greater reciprocity in trade. Trade investigations launched this year leave open the possibility of greater confrontation in the year ahead. On a visit to Asia in the fall, the president was notably restrained, articulating an “Indo-Pacific” strategy with little in the way of substance. The administration abandoned the Comprehensive Economic Dialogue, a high-level forum which began during George Bush’s presidency and continued under Obama. Freedom of navigation operations continued in the South China Sea.

International affairs

Xi began the year at the World Economic Forum positioning China as the defender of globalization, which was greeted with both skepticism but also recognition as a warning of the consequences of American retreat from the world stage. China also affirmed its commitment to the Paris climate accords despite Trump’s withdrawal. The Belt and Road Initiative continued with a major conference in the spring, but with little more coherency and growing concerns about its intent.

The South China Sea disputes receded in importance relative to North Korea. Beijing is increasingly worried about the future of North Korea and frustrated by both its inability to influence the regime and the centrality with which Trump has made the issue¬† to the US-China relationship. Elsewhere, the summer-long border dispute with India achieved little more than to reinforce India’s growing conviction of the need to balance China. In Japan, Shinzo Abe’s sweeping fall electoral victory paves the way for the country’s continued militarization. China’s objection to South Korea’s installation of the American THAAD missile defense system with a widespread boycott that has since thawed. The People’s Liberation Army celebrated its 90th anniversary amid a push by Xi for major reforms. The country also launched its first indigenous aircraft carrier.

Concerns about China’s global influence have become a less distinctly American phenomenon. Europe, Canada, Australia, and the United States are all tightening government scrutiny of Chinese investment. Australia and New Zealand are warning against undue Chinese influence in their politics and are moving to change laws as a result. A China-born member of the New Zealand parliament was probed for his prior work at Chinese military schools and an Australian MP stepped down after donations from a Chinese billionaire were disclosed. China’s efforts to exert greater control over its diaspora have become particularly sensitive on university campuses. Chinese media denounced Australia’s efforts to defend against foreign influence as “hysterical paranoia” with “racist undertones.”

Economics and business

Economic growth was predictably stable, all the more so in a politically important year. Nonetheless, the central bank chief made an unusually frank warning of the risks of a sharp correction. The government continued its shift to “quality” growth, with forceful moves on financial regulation, overcapacity, and debt problems. Industrial policy efforts continued with¬† designs to promote the electric car industry among this year’s most prominent efforts. Major acquisitions of foreign assets all but ceased as major conglomerates, such as HNA and Anbang, were brought to heel. McDonald’s sold its China franchise while Starbucks opened its largest store in the world. The unveiling of the C919 airliner was another symbol of China’s quest for indigenous innovation. It was reported that Chinese firms employed 141,000 Americans at the end of last year, an increase of 46 percent over the prior year.

The Chinese tech industry had another banner year. Seas of yellow and orange bikes on city streets symbolized the rise of the sharing economy with China’s characteristic excess. But as tech becomes more influential, it is becoming more subject to the whims of the state. Aggressive censorship efforts have moved beyond public communications to include private chats, risking further alienating people from their government and hurting a society already short on trust. Bans on WhatsApp, VPNs, and Apple’s compliance with orders to remove apps such as Skype and the New York Times from its store further closed off China’s internet users from the world.

The year also revealed the extent to which Chinese e-commerce rests on the apparent contradiction between a growing middle-class and a permanent under-class of migrants who can cater to their whims. Should crackdowns on migrant labor continue, many business models will need to be reconsidered. Chinese tech evangelists were triumphant that the hordes of data its companies are generating will position China as a leader in artificial intelligence.

The US abandonment of the Trans-Pacific Partnership was a setback to American leadership, but many countries are continuing to pursue a deal. Modest progress was made on China’s rival regional free trade agreement.

Society and culture

In education, the push against Western values and for greater subservience to the Party continued. Western academic publishers were faced with demands to censor content in a further erosion of free inquiry. The environment for human rights lawyers and other activists remained bleak.

In culture, a nationalist action film achieved box office records, while theaters were ordered to show pro-Party propaganda before all screenings. A transgender television host and androgynous female “boy band” captured the attention of Chinese and Westerners alike. The game Honor of Kings became so popular that the government demanded restrictions be placed on its playing time. The millennial obsession with avocados reached China while the government promoted skiing in advance of its hosting of the 2022 Winter Olympics. The actress Liu Yifei was selected by Disney to star in the live action version of Mulan. Bao Bao, the panda born in Washington, returned to China. In New York, the Guggenheim in New York hosted a major exhibition of Chinese art after 1989.

Major books published this year on China include Graham Allison’s Destined for War, Richard McGregor’s Asia’s Reckoning focused on Japan-China-US relations, Ian Johnson’s Souls of China on the revival of religion, and Howard French’s Everything Under the Heavens on how the past illuminates China’s present.

Zhou Youguang, considered the father of China’s pinyin Romanization system, died in January. The death of Nobel Prize winner and pro-democracy activist Liu Xiaobo, who had been jailed since 2009, engendered worldwide condemnation. His wife, Liu Xia, remains under house arrest.