Renaldo Weekes, Guest Contributor
The novel Coronavirus disease (COVID-19): a common threat that has united the world in unprecedented ways. As the pandemic rages on, however, some are getting anxious and want answers. United States (US) officials have accused China of mismanaging the coronavirus response and allege that it originated in a Chinese lab. China responded with allegations that the US military planted the virus in Wuhan.
The possibility for escalation is nigh as US President Donald Trump reportedly suggested that China may be punished for its alleged impropriety through new tariffs, sanctions and the lifting of sovereign immunity. As the US seeks to punish China, one wonders what the effects may be on the wider world.
The Global Economy
The tariffs being floated by the Trump administration as possible punishments will stifle the global economy since, being the world’s two largest economies, the US and China are very much intertwined in the global economy. Consideration must also be given to how China will retaliate to the tariffs.
Tariffs, essentially being a tax on imported goods, will make goods more expensive at a time when many businesses and consumers cannot absorb such a cost. What little spending power exists will diminish, further pushing the economy downward. The global economy’s recovery rate will be restricted as supply chains will slowly regain traction amidst low numbers of buyers and sellers. Shocks will hit small open economies especially hard as they greatly depend on foreign production that travels through the US. It is still left to be seen if the US will follow through with such plans however.
Sanctions have more versatility in the sense that they can be applied to certain businesses or individuals within the US banking system. This is effective because the US has a long reach in the world’s financial system. However, depending on where those sanctions are applied, there could be some disruption in the global supply chain because, as mentioned earlier, China is intertwined in the global system. Again, small open economies that regularly do business with China will be in trouble.
The lifting of state sovereign immunity allows American citizens and the American Government to sue China for COVID-related issues. Removal of sovereign immunity may have at least two effects. First, it allows the US wants to fight China with its own rules by allowing lawsuits. Secondly, if state-owned or state-related Chinese businesses in US jurisdictions are entangled in lawsuits, China will have to decide if staying in the US is worth the retaliatory lawsuits or risk relocation which may cause disruptions in supply chains.
Considering the implications of this clash to the wider world, both parties have been working to push their narrative to their partners for support. This puts a number of countries with mutual relationships in an awkward position as they must now play chess with their words and actions which, as seen through Australia and the European Union (EU), is quite difficult.
Australia has, just like the US, called for an investigation into the virus’s origins but has stopped short of saying the virus came from a lab. To China, not overtly opposing those claims is implicit support of the US’ claims and in response, Chinese Ambassador to Australia Cheng Jingye suggested a possible shift in trade relations between the two countries. Acting on those words, China has suspended beef imports from Australia. This underscores China’s willingness to use its economic might against countries politically opposed to it. Such tactics may hurt Australia as China accounts for 36 percent of Australia’s total annual exports. Though both countries claim that the issue is separate from the pandemic, it is hard to defend that point considering the veiled threat laid by the Chinese ambassador. One must ask whether it is possible to separate the two incidents or if it would have happened but for the call for an investigation.
The EU has been under the spotlight for editing a report related to disinformation campaigns by China to appease China and for allowing China to censor an opinion piece written by the EU’s ambassador to China. The EU’s move is seen as bending more toward China by editing its report and allowing China to censor its piece. Added to this is reporting that the European External Action Service (EEAS), responsible for the bloc’s foreign policy, has been rife with problems related to each EU member state wanting to follow its own agenda. This suggests no real coordinated effort toward handling the issue and a weakening of the EU’s position as this may, theoretically, give China an opening to further cement this divide.
Despite what may appear to be the case, EU member states have stood up to China. It is reported that China attempted to encourage German Government officials to make positive spins on how it has been handling the virus but it was quickly shot down. France hastily summoned its Chinese ambassador when a Chinese diplomat wrote a piece criticising Western countries on their treatment of the elderly. President of France Emmanuel Macron and German chancellor Angela Merkel have both called for investigations into the origins of the virus but, similar to Australia, have not claimed that the virus came from a lab. Joined with that is the EU’s support of the US’ push for an investigation into the coronavirus’s origins at the WHO general assembly. These examples show that the EU is not necessarily bowing to China. Considering the historically friendly relationship between the two, the EU would not have the same motivation as the US to immediately dismiss China.
Even the World Health Organisation (WHO)?
The WHO itself has been dragged into the fray by the US as the Washington has suspended its WHO funding due to accusations that that UN agency facilitated China’s hiding of coronavirus statistics. Such an accusation suggests that the WHO abdicated its duty in order to appease China. The US’ actions also serve to weaken the WHO’s ability to help the world at large; more so those who cannot help themselves. Allowing a spat to spill over into the UN agency for health during a pandemic is seen by many critics as a way for the Trump administration to deflect any blame it is receiving for its handling of the virus domestically; especially since a Presidential election is due this November.
COVID-19 has led to a pandemic that took the world by surprise. Most people did not think that a virus in China would spread to the world. Nevertheless it has and people’s magnanimity has shown through like never before. However, it has devolved into a blame game between the world’s most powerful countries about how the pandemic started, capturing many other countries in the fray. But for the pandemic, would the US and China be in this situation? Probably not, but here we are. The only real way for this situation to stop is if the US recants or if China admits fault. At this point, neither seems likely. One can only hope that the war of words between the two countries does not escalate to a point of no return that drags the rest of the world down as a result.
Renaldo Weekes is a holder of a BSc. (Sociology and Law) who observes international affairs from his humble, small island home. He has keen interest in how countries try to maneuver across the international political and legal stage.