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Foreign Policy

Chinese-Style Multilateralism

Oct 11, 2023
  • Gu Bin

    China Forum expert at Tsinghua University, Associate Professor of Law at Beijing Foreign Studies University


Countries attending the ongoing 78th United Nations General Assembly have called for resolving global issues through “true multilateralism.” A priority emerged and became the   theme of general debate: implementing the UN Agenda 2030 and its goals of sustainable development. Resolving development concerns through multilateralism reflects a clear historical trend, marked by the rise of the Global South and conforms to the core principles of Chinese-style multilateralism. 

Multilateralism, Chinese style 

The report of the 20th National Congress of the Communist Party of China states that the country “practices consultation, cooperation and shared benefits in global governance [and] upholds true multilateralism.” Chinese-style multilateralism embodies Chinese thinking about participation in global governance — that is, increasing the representativeness and say of emerging economies and developing nations. Some people suspect that Chinese-style multilateralism means creating a new international order and overthrowing the existing one. This is a distortion. The relationship between Chinese and American styles of multilateralism is that the Chinese style is based on America’s but transcends it.

”Based on American style” first means recognition of the historical contributions of American-style multilateralism. Multilateralist practices originated in Europe, but it was the United States that epitomized it. Multilateralism was being practiced in Europe as early as the 19th century, although in a sporadic manner, such as the Concert of Europe in 1815, the Paris Convention on the Protection of Industrial Property in 1883 and the International Telegraph Union in 1865. After World War I, U.S. President Woodrow Wilson pushed for the establishment of the League of Nations. In the latter stages of World War II, the U.S. led the building of the United Nations, the Bretton Woods system and the General Agreement on Tariffs and Trade, or GATT. In the decades that followed, multilateralist institutions mushroomed in various professional realms, and the practice has thrived. Generally speaking, American-style multilateralism has dominated international economic cooperation since 1944 and promoted economic globalization, trade and investment liberalization, guaranteeing long-term peace and development in the postwar era.

Chinese-style multilateralism has transcended the American style because the U.S. has gradually deviated from its original intent. On one hand, it has abused its hegemony and drifted to the opposite side of multilateralism. Although the Trump and Biden administrations have behaved differently in style, they have both put “America first” above multilateralism. On the other hand, the interests and demands of emerging economies and developing nations have not been reflected effectively. As their economic strength grows, they are increasingly dissatisfied with American-style multilateralism.

“Taxation without representation” was an important trigger of the American war of independence in the 18th century. A similar unfair phenomenon exists in the present-day international community. It may be called “contribution without representation.” Yet, emerging economies and developing nations are only seeking evolution, not revolution. 

China’s pragmatic route 

Chinese-style multilateralism has emerged against a background of global governance reform. After the global financial crisis of 2008, under the concept of “a community with a shared future for mankind,” Chinese-style multilateralism has demonstrated a twin track approach.

One track promotes the reform of such traditional institutions as the IMF, World Bank and WTO. Such reforms have seen some progress but have proceeded slowly thanks to U.S. resistance and disruption. For instance, at the WTO, according to the new shares equation after reform, China should hold a 12 percent share, but only has 6 percent, behind the U.S. and Japan — far from reflecting the effect of the reform.

The other track involves multilateral mechanisms proposed by China, especially the Belt and Road Initiative, Asian Infrastructure Investment Bank, NBD and Multilateral Cooperation Center for Development Finance since 2013. China has also proposed the Global Development Initiative (2021), Global Security Initiative (2022) and Global Civilization Initiative (2023). These are gradually being actively embraced by other countries. 

The AIIB is one of the best examples of Chinese-style multilateralism. This is because the AIIB is a physical entity with a complete legal framework, first-rate governance structure, professional standards and top credit rating. It caters to both South-South and South-North cooperation. Having originated in Asia, the AIIB has rapidly grown into a global multilateral development bank in just eight years.

The AIIB’s global features lie in five aspects: membership, investment, fundraising, purchasing and employment. It is a capital-based intergovernmental organization with an authorized capital stock of $100 billion, with most of its 106 member-shareholders being sovereign states. The AIIB invests mainly in infrastructure projects in developing countriesand has so far invested $40 billion in more than 200 projects. According to the 1-to-3 leverage ratio, AIIB investments may raise may raise $100 billion in various forms of non-governmental capital. AIIB-invested infrastructure projects range from such traditional categories as railways, highways, airports and oil and gas pipelines to digital infrastructure (satellite and broadband)  and social infrastructure (public health). 

Relationship between AIIB and BRI 

For some time, the BRI has been bad-mouthed as employing low standards, causing environmental damage, committing human rights violations, creating debt traps and practicing a new colonialism. Whether the AIIB should participate in the BRI has thus become a sensitive topic. Some people believe participating in the BRI tarnishes AIIB’s reputation, and they have attempt to decouple them.

Opponents hold that since AIIB rules have not in clear terms authorized it to support the BRI, it should not participate. Supporters argue that the BRI conforms to the stipulation of “improving infrastructure interconnectivity” under clause 1.1 of the AIIB Agreement. Therefor, support for BRI construction projects does not contradict concrete clauses of related rules, and the AIIB should participate. In fact nearly all of the  more than 200 AIIB-invested projects are distributed in countries along the Belt and Road and are basically BRI projects. The AIIB has signed memorandums of understanding with such institutions as the World Bank on supporting the BRI.

While judging whether an international organization has authorization under a specific treaty, one should not dwell on whether there is clear authorization in the treaty. What’s important is whether or not it is conducive to achieving the purpose and goals of the document, and it can support it as long as it does not violate explicit stipulations of the document. This is purposive construction, or implied power.

Purposive construction is conducive to international organizations flexibly applying rules under the guidance of treaty purposes and adapting to a changing world. The AIIB drew on the World Bank’s experience and adopted a purpose-oriented treaty explanation, which has best been embodied in handling its relations with the BRI.

The AIIB not only participated in the BRI but has also fostered its quality development. The Export-Import Bank of China project is a typical example. The bank has been known as a leading institution for BRI fund-raising. The new environmental and social framework it created last year aligns with the universal standards of international financial institutions. The current round of rules revisions has received the full support of the AIIB and MCDF. As a result, the framework has directly adopted many of the high standards of the AIIB and World Bank.

Some people have asked, how can countries engage in multilateral cooperation with everyone proceeding with their own brand of multilateralism? Behind this question is the assumption that China is building a new order, which is exactly what China is opposed to doing. Chinese-style multilateralism intends to optimize the existing order rather than create a new one — that is, inheriting the American style’s merits of being rules-based, advocating high standards, correcting the defect of under-representing developing nations and adding the fine traditional Chinese element of consultation. 

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