CCP Continues to Seek Capital From the West as China's Economy Deteriorates: Expert

CCP Continues to Seek Capital From the West as China's Economy Deteriorates: Expert
U.S. President Joe Biden meets with Chinese leader Xi Jinping on the sidelines of the G20 leaders' summit in Bali, Indonesia, on Nov. 14, 2022. (Kevin Lamarque/Reuters)
Venus Upadhayaya

The Chinese Communist Party is continuing to seek capital from the West in the hopes of buttressing its domestic economy struggling with the ongoing effects of the regime's strict zero-COVID policy, according to China expert retired Brigadier Gen. Robert Spalding.

"There's this competing effort happening where many of the Chinese proxies … are trying to help continue to push capital into China. At the same time, we are seeing these COVID controls within China which are really about controlling the population, are creating issues with the supply chain," Spalding, a senior fellow with the Hudson Institute think tank, told the "Newsmakers" program, a co-production by The Epoch Times and sister media outlet NTD, on Nov. 23.

The analyst, also a contributor for The Epoch Times, pointed at the turbulence in the Chinese stock market in recent months.

"So what is happening? Well, I think it means that the Chinese Communist Party is trying to continue to get capital out [to] the West, continue to remain connected. At the same time there's this realization that things are coming apart," Spalding said, adding that this situation has created a lot of volatility and uncertainty which isn't good for business.

His comments came ahead of mass protests across China over the weekend against the regime's draconian zero-COVID policies, marking the biggest display of public opposition to the communist regime in decades. The protests sent Chinese stocks tumbling on Monday, though markets rebounded on Tuesday in the hopes of an easing of the COVID restrictions.

Supply Chain Issues

The West has already started to rethink its dependence on China, and as a result, supply chains have already started to move out of the communist country, according to Spalding.

"My concern is that it is not moving fast. And as you know if we get into some kind of issue where there's some kind of confrontation between China and Taiwan, you can see the supply chain can be the lever by which the Chinese Communist Party begins to coerce the United States," he said.

There are many products for which the United States is dependent on China and they can be used by the regime to control the United States. Spalding is particularly concerned about pharmaceuticals.

"It could be pulling on the hard strings on Americans as it impacts their daily health," he said.

Rosemary Gibson, a senior adviser on healthcare issues at the bioethics-focused Hastings Center, in congressional testimony in 2019 said that U.S. national health security and national security are both threatened by its dependence on China for thousands of ingredients and raw materials to make its medicines.

"If China shut the door on exports of medicines and their key ingredients and raw materials, U.S. hospitals and military hospitals and clinics would cease to function within months, if not days," said Gibson (pdf).

Spalding said that since gaining a third term in office, Chinese leader Xi Jinping feels emboldened and will continue to seek Western capital and technology flow into China.

"I think that you are going to see the Chinese continue to pressure the United States in ways that certainly Biden was receptive to during their meeting on the sidelines of the G20," he said, referring to the recent face-to-face meeting between Xi and President Joe Biden.

Spalding believes that with the new Congress next year, there's going to be pressure on the U.S. administration to begin to completely sever its trade and connectivity with China.

Venus Upadhayaya reports on wide range of issues. Her area of expertise is in Indian and South Asian geopolitics. She has reported from the very volatile India-Pakistan border and has contributed to mainstream print media in India for about a decade. Community media, sustainable development, and leadership remain her key areas of interest.