China has gone from a desirable partner to one that cannot be trusted on the world stage. Her repression, economic and political thuggery will cost her dearly unless there's a change. Western governments are changing their stance. But foreign policy execution by Western countries will remain problematic.

1. China’sTransition from BFF
to Outcast
Her unpopularity and its effects on foreign policy
Dr Sarma VANGALA
CEO
Metastrategy, Inc
Toronto, CANADA

2. Sputtering ‘soft power’ overseas

4. Full throated ‘hard power’ at home

6. Initial Successes
• Asian Infrastructure Investment Bank {AIIB};
• Belt and Road Initiative {B & RI};
• Confucius Institutes;
• Providing a template for state capitalism
development after financial crisis of 2008.

7. The Rot Sets In
• Overall rising authoritarianism at home;
• Cover-up of origins of Covid-19;
• Brutal repression of protests in Hong Kong;
• Failed zero-Covid strategy;
• WolfWarrior diplomacy and economic coercion of
states, multi-nationals and large private Chinese
corporations.

8. The Rot Sets In

10. Consequences of Poor Image
Trade
• Achieving Beijing’s goals becomes difficult;
• Impedes economic relations;
• Loss of traditional support from trade groups;
• Countries try to reduce trade dependence on China.

11. Consequences of Poor Image
Strategic
• Soft-power campaigns {state media,
diplomats, Confucius Institutes} ineffective
• Lack of trust in China’s government and
businesses

12. Consequences of Poor Image
For US and other major democracies
• Hampers cooperation on global issues, e.g.,
climate change or preparing for the next
pandemic

13. Advantages of Poor Image
For democracies
• Closer informal coalitions to limit Beijing’s
access to critical technology;
• Impede it at international forums, e.g., UN;
• Cooperate more closely with other countries
on military relationships.

14. Advantages of Poor Image
• Leading democracies become more resilient
to economic and diplomatic coercion from
Beijing.

15. The Path to Popularity
• Until 1990s Beijing used humble formal diplomacy to
foster a positive image;
– Launching CCTV International, a global news service
– Training programmes for foreign officials on combating
poverty, attracting investment, increasing agricultural yields
– Non-interventionist power
– Would not assert its model {implying US imposes its model}

16. The Path to Popularity
• Provided scholarships to foreign students
coming to Chinese universities
– Foreign students numbered 442 000 in the period
2002-2016;
– These students become conduits of favourable
views on China on their return.

17. The Path to Popularity
• Chinese full fee-paying students were
welcomed by topWestern universities;
• Elite-to-Elite diplomacy and bi-directional
travel by diplomats and senior leadership to S E
Asia, Africa and Latin America.

18. The Fall
• China’s ambassador to Sweden demanded an investigation into the
removal of Chinese tourists from a hotel for trespassing;
• Chinese diplomats tried to barge into the residence of foreign minister
of Papua New Guinea to force him to change the wording on a
communique at an ASEAN summit;
• Vitriolic tweets e.g., that British citizens were descendants of war
criminals
• Tariffs on Australian exports after Morrison’s critical comments on
China’s rights abuses;
• Arrest of 2 Canadians in retaliation for Canada holding Huawei’s CFO;
• Inorganic inflation of followers on Facebook of Chinese media outlets.

19. Difficulties China Faces
• Sri Lanka’s restructuring of China’s B&RI debt to
be overseen by India and Japan, who are not
allies of China;
• IMF and Club of Paris averse to assisting China
with her foreign debt.
• Zimbabwe, Pakistan, Kenya, Laos are waiting in
the wings for renegotiation of their B&RI loans

20. Lithuania’s Model
• Change status ofTaiwan’s office inVilnius
• Limit imports and exports to China
Will other countries follow?

21. Impact on Foreign Relations
• 2nd largest economy will soon be
discriminated against
• AUKUS, QUAD and other groupings will
exclude China
• Trade integration now being led by Japan

23. TheWay Forward
• Democracies should divulge China’s increasing use of
disinformation
• Democracies should screen foreign investments in media
and information outlets
• Focus on CCP and Xi so the populace remain blameless
• Limit China’s access to critical technologies
• Increase US’ soft power e.g.,Voice of America, Radio Free
Asia, etc.

24. How to Redeem Itself
• Come on the world stage and take a stand on:
– Russia’s invasion of Ukraine
– Assist in helping poor countries with the effects of
climate change

25. SarmaVANGALA, Ph D
Chief Executive Officer
Metastrategy, Inc.
• SarmaVangala is a corporate consultant
specialising in Strategy, M&A and Business
Transformation
• Based inToronto, CANADA
• BTech (IIT(M)); PhD (Exon.); Professional Engineer
• sarma.vangala@metastrategyinc.com

26. Dynamics