The Attraction of China: A Fragile Balance and new knots to untie
This article was originally published in Italian in Panorama on 27th Feb 2022.
Please note that this is a courtesy translation of the Italian language article originally published in the Panorama Magazine Issue at: https://www.panorama.it/economia/cina-e-attrattivita-tra-fragili-equilibri-e-nuovi-nodi-da-sciogliere
In early February, according to its lunar calendar, China entered the zodiac sign of the Tiger, a symbol of dynamism and courage. Truly, such features were not lacking in Beijing, which hosted the Winter Olympics 2022, thus obtaining the record of being the first city in the world to have hosted both the Winter Olympic Games and the Summer Olympic Games back in 2008.
During the Beijing Winter Olympics 2022, it seems that not only sporting competitions are disputed, but also geopolitical issues, giving the fact that this edition of the Winter Olympics appears as a further opportunity for China to present itself to the world in a different way, somewhat antithetical to the one we saw in 2008.
The 2008 Summer Olympics were held in a period of great growth for China (only shortly after the slowdown brought on by the Lehman Brothers crisis of the same year). The latter wanted to show itself to the world as an open nation that welcomed the many foreigners who came to support their country; this year, however, the framework of the games is profoundly different.
Due to the ongoing Covid 19 (Covid) pandemic and China’s zero tolerance policy, Beijing 2022 is a city of contrasts. On the one hand, we have the Olympic Games within the “Olympic bubble”, on the other, there is the dynamic zero-Covid strategy: 14 days of quarantine in government run hotels, even for those vaccinated with three doses, and an 7 additional days under observation in another hotel if you come from abroad. All this only if you are lucky enough to catch one of the few remaining flights from Europe to China.
Considering foreign policy, the Olympics remain a strategic showcase for China. Despite the US suggested diplomatic boycott, more than 30 political world leaders attended the opening ceremony of the Olympic Games, confirming China’s strategic importance.
Among those present was Russian President Vladimir Putin, who had the opportunity to have a bilateral meeting with President Xi and sign trade agreements worth over 115 billion dollars, including a 30-year agreement to supply China with gas from Moscow through a new pipeline. In addition to trade cooperation, there is also political synergy, as demonstrated by the long joint declaration of mutual support following the bilateral meeting between the Presidents of the two countries on the inauguration day, which doesn’t preclude China having an interest in a stable relationship with the European area, amidst ongoing trade tensions with the US.
The Argentine leader Alberto Fernandez, was able to agree a five-year cooperation plan with President Xi for the diversification of trade and investment in areas such as trade, agriculture, and energy. In relation to energy, the recent agreement signed by China National Nuclear Corporation (CNNC), a Chinese company wholly owned by the State, and Argentina for the construction of the Atucha III nuclear power plant, worth 8 billion USD, using Chinese Hualong One technology, is worth noting, as it has relaunched a deal that had been stalled for years.
The course of time and the future strategic choices will determinethe winner of this geopolitical game which is being played out on the international chessboard during the Olympics. For the time being, if winners are to be identified, they can be found in sports only. Among these winners there is Eileen Gu, the US-born athlete of Sino-American descent, who decided in 2019 to represent China (since China does not recognize dual citizenship) by winning two gold medals at Beijing 2022, one in the women’s freeski big air and the other on the halfpipe.
Today, her sporting merit, and her story of success of representing China, instead of the US, makes her one of the most well paid athletes of the Olympic Games, counting more than twenty multinational groups as sponsors, including Anta, JD.com, China Mobile, but also Estée Lauder, Cadillac, Louis Vuitton, Tiffany & Co, Victoria’s Secret and Bank of China, for a contractual value of over 200 million RMB (the equivalent of more than 27 million Euro).
The value of the Olympic Games is therefore very high for the Chinese community. It is estimated that these games will bring more than 300 million Chinese people to winter sports, a great opportunity for Italy that will be the next organizer with the games in Milan/Cortina.
The hope is that this handover between Beijing and Milan as host cities for the Olympic Games could help to re-establish direct flights between the two cities, starting with those operated by the premier Chinese air carrier, Air China, which our Embassy in Beijing has been workingon for some time. Moreover, the proposal of the Italian business community in China to reconsider China’s presence in the “List E” countries, one of the five lists in which the various countries of the world have been classified by the Italian authorities in relation to the freedom of travel of Italian citizens during the pandemic, is certainly welcome.
As of today, anyone travelling from China, to a Covid free country, within Europe, where the pandemic is registering new peaks, is subject to quarantine, despite coming from a part of the world where the virus has been contained, because of the principle of reciprocity. For this reason, an executive who wants to travel to Italy and then back to China, will go through about a month of isolation, before being able to return to work in his company, causing major economic grievances.
In addition, for List E countries, the rules for access and international movement are not uniform, as they depend on the conditions of each individual government authority.
In conclusion, China during Beijing Winter Olympics 2022 is experiencing a new challenge on the international stage, which includes the need for containing Covid, and above all, the redefinition of its growth strategy in relation to the management of its international relations, between Moscow and the West. This challenge is not easy at all, but China’s Olympic victories clear the way to optimism.
Edited by: Lawyer Carlo D’Andrea, Vice President of the European Chamber of Commerce in Chins