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2020 look ahead: China faces up to tough regional challenges

South China Sea, Belt and Road Initiative and Taiwan are all on Xi's to-do list

| China
China has unleashed its armada of coast guard.   © Visual China Group/Getty Images

Twenty-nineteen showed how much difference a year can make to the fate and self-perception of even the greatest and most ambitious powers. It also marked the toughest year in the political career of Xi Jinping, China's de facto president for life.

Far from backing down, however, strong-willed Xi is expected to forge on against major regional challenges in 2020, albeit in a diminished form and on more uncertain grounds: U.S. involvement in the South China Sea; resistance to the Belt and Road Initiative; and the problem of Taiwan's presidential election.

Foremost, Beijing confronts a more concerted pushback by Washington. With the U.S. heading into contentious elections, both major parties have adopted a critical stance against China. In recent years, the long-held belief in the need for engagement with Beijing has given way to bipartisan resistance and confrontation.

Partly, this is the upshot of the triumphalist foreign policy of the Xi administration, which has upended low-key diplomacy in favor of an all-out bid for regional hegemony. In the South China Sea, Beijing has overseen the rapid militarization of disputed land features through the deployment of, among others, surface-to-air missiles and electronic jamming equipment.

China has unleashed its armada of coast guard and paramilitary forces, which have been at the forefront of its aggressive intrusion into traditional waters of smaller neighbors. And in recent months, the Xi administration has directly challenged efforts by Southeast Asian states to develop energy resources in disputed areas, culminating in the monthslong naval standoff over the Vanguard Bank within Vietnamese waters this year.

Even more ambitiously, China has sought to secure the deference and dependence of neighboring states through an ambitious trillion-dollar Belt and Road Initiative, which aims to revamp the infrastructure landscape in Asia and create a new economic order along Beijing's preferences.

It is no wonder that the Trump administration has doubled down on its punitive tariffs and investment restrictions against China.

The Pentagon has expanded its naval presence in China's adjacent waters, deploying a growing number of state of the art warships to contest China's excessive claims in the South China Sea. Meanwhile, the People's Liberation Army will continue to dial down tensions with Pentagon through sustained military-to-military dialogue and development of various mechanisms of conflict-management.

Fiery Cross Reef in the South China Sea: Beijing has overseen the rapid militarization of disputed land features.   © DigitalGlobe/Getty Images

Cognizant of growing backlash across the region, China should return to the negotiating table to address maritime disputes in the South China Sea. It has sued for dialogue over maritime disputes with Vietnam; formed a joint development agreement with the Philippines; and is pushing for a legally-binding code of conduct with ASEAN nations in the contested area.

Almost regardless of who wins this year's elections, Washington will likely continue its current course of confrontation with China, absent a grand bargain on a wide and expanding range of disagreements.

It is not just China's guns which are facing increased regional resistance but its money too. Japan, Australia and India are pushing for alternative infrastructure development initiatives to the BRI, while highlighting deep risks, including the so-called debt trap of Chinese loans, associated with it.

Through defense and technical aid, these middle powers are also strengthening the capacity of smaller regional states, particularly in the realm of maritime security, to protect their interests and sovereignty against an ascendant China.

In Malaysia, one of Beijing's closest regional partners, an electoral tsunami toppled a China-friendly administration partly due to fears of a debt trap. Prime Minister Mahathir Mohamad, who openly warned against "new colonialism" during a high-profile visit to Beijing, has made the renegotiation of Chinese investments a centerpiece of his return to power.

At the very minimum, China will continue to revise its regional economic diplomacy as part of an emerging BRI 2.0. This was on display earlier this year, when Xi promised a more inclusive and transparent BRI, which emphasizes debt sustainability, environmental compliance and good governance.

Finally, Taiwan is holding its presidential election on January 11, with pro-independence incumbent Tsai Ing-wen facing the Beijing-friendly Han Kuo-yu of the Kuomintang.

Hong Kong's open defiance of Beijing has strengthened the hands of the pro-independence movement in Taiwan, where Tsai is widely expected to secure reelection. On top of this, the Trump administration has thrown its support squarely behind Taiwan through rare high-level diplomatic exchanges and large-scale arms exports.

While formally adopting tough language on Taiwan, ruling out any compromise with pro-independence voices, Beijing is expected to continue exploring ways to peacefully manage this setback and explore nonviolent means to protect its interests in greater China.

If history is a guide, even the most aggressive Chinese leaders have possessed sufficient pragmatism and strategic dexterity to recalibrate their ambitions when faced with stiff resistance by neighbors and rivals. Thus it is important for the U.S. and its regional partners to maintain sustained engagement with China while it collectively resists its worst instincts.

China is too big to be contained, but its aggressive impulses can be constrained through firm countermeasures by rivals and neighboring states. Instead of risking outright conflict by seeking to humiliate China, the best way forward is to nudge a humbled power toward greater commitment to a rules-based international system, as well as respecting the legitimate interests of its smaller neighbors.

Richard Heydarian is an Asia-based academic, columnist and author of "The Rise of Duterte: A Populist Revolt Against Elite Democracy" and the "The Indo-Pacific: Trump, China and the New Struggle for Global Mastery."

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