How China reversed the new Great Game of strategic competition

It was barely a few years ago that top American politicians conducted foreign policy with the expectation that China would become more like the U.S. as it became more prosperous and increasingly entangled with the world.

Few had the imagination to consider the reverse: that the U.S., and the West, would be forced to become more like China in the new Great Game of strategic competition.

The implications of China's rise are still being absorbed in multiple domains, in trade, technology and geopolitics. But the most significant impact may be in how China's Communist Party-led government is changing global governance more in its own image rather than the other way around. COVID-19 has helped reinforce this trend in the short term. After the initial disastrous cover-up of the outbreak of the virus in Wuhan, the Chinese party-state's unparalleled, and unchallenged, state capacity has driven infection rates down.

With little debate, the government was able to lockdown hundreds of millions of people in their homes, seal internal and international borders, shut factories while commandeering the output of some businesses to supply medical equipment, mobilize the military, build hospitals and track the movements of citizens through mobile phone apps.

Many governments have looked on with envy at this display of state capacity, even if a number of democracies have been successful in corralling rising infections without wielding authoritarian powers. The crisis has also been a reminder of China's dominance of supply chains for essential medical supplies, like protective masks and pharmaceutical ingredients, leaving even advanced democracies exposed.

As a result, the kinds of political ideas which had struggled to find an audience in the U.S., including advanced industrial policy and the need to protect and nurture strategic sectors, are making a comeback, largely to compete against similar policies in China. But it's the intensifying tech war with the West, particularly the U.S., that has, paradoxically, really underscored Beijing's far-reaching influence.

China has long worked to decouple its internet from the West, both by blocking content through its so-called Great Firewall, as well as banning U.S. tech giants such as Facebook, Twitter and Google, which dominate the web outside China. While throwing a protective wall around local industries doesn't always stimulate innovation and growth, in China's case, local internet giants like Alibaba Group Holding, Tencent Holdings and TikTok have blossomed -- both at home, and abroad.

Instead of welcoming the competition, the Trump administration is now returning the favor, by throwing up its own barriers to Chinese tech companies. If China can exclude a company like Facebook from its market, then Washington has decided that it will try to do the same. Such measures are the polar opposite of the way that Washington used to view the internet as an unstoppable vector of democracy that would undermine authoritarian governments.

Bill Clinton famously encapsulated this notion by saying that China's efforts to control its domestic internet would be about as effective as "nailing Jello to the wall." It turned out that Beijing had lots of nails, and they worked. Now Washington is reverse engineering some of the same tools to use against Beijing. The exclusionary tactics are also being used to stymie the growth of Huawei Technologies, the Chinese telecommunications giant which has been at the forefront of fifth-generation, or 5G, technology innovation, with the U.S. waging a global campaign to keep Huawei out of as many major markets as it can.

After a slow start, which prompted speculation that Washington's campaign was failing, a whole host of countries, including the U.K., Singapore, Japan and France, have jumped on board, albeit in different ways. Put another way, the policies that China adopted to ensure its internet and communications systems were sealed off from the world are now being replicated in Western countries which once would have regarded such approaches as self-defeating.

The idea of a "splinternet" is harder to replicate when it comes to international organizations, where China has adopted a dual approach. By joining and working to change from within organizations like the UN, Beijing has also set up parallel institutions under its own leadership with bespoke memberships.

Two that stand out are the Asia Infrastructure Investment Bank and the Shanghai Cooperation Forum which have both become fixtures of Beijing's financial and regional diplomacy. In many respects, the Chinese approach in part mimicked the West, which has both pioneered and often controlled international bodies, while also running various alliances alongside.

But, again, in the new era of Chinese power, Western countries, including the U.S., feel like they are playing catch-up with Asia's rising superpower. The long-standing Five Eyes intelligence partnership, bringing together the U.S., U.K., Canada, Australia and New Zealand Anglo-Sphere, has been revamped and strengthened as an institution. It is not just their intelligence agencies that meet. The Five Eyes finance ministers are also having regular phone hookups to discuss supply chains, with Japan making it clear that it would like to join.

Becoming more like China, rather than China becoming more "like us" is a new playbook for the West. Whether it works better than the old one remains to be seen.

Richard McGregor is a senior fellow at the Lowy Institute in Sydney