For China, Biden’s exit from Afghanistan creates as much risk as opportunity

August 17, 2021, 12:42 PM UTC

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China’s state-owned media has had a field day trolling the Biden administration for America’s messy exit from Afghanistan.

“The fall of Kabul marks the collapse of the U.S.’s international image and credibility,” declared state-controlled Xinhua News Agency in a commentary Monday.

The U.S. departure from Afghanistan should serve as a “warning bell to secessionists in Taiwan,” intoned the state-run Global Times, adding “it’s not the first time the U.S. has abandoned its allies.” On Twitter, Global Times‘ editor-in-chief, Hu Xijin, observed archly that the transfer of power in Kabul had been “even more smooth than [the] presidential transition in the U.S.”

The state-owned Beijing Daily piled on by publishing a story featuring screenshots of Chinese social media users saying they “can’t help but connect” the U.S. evacuation from Kabul to the title of a 2019 Columbia Pictures film that just happens to be airing on state broadcaster CCTV. The movie? A Dog’s Way Home.

The U.S. retreat feeds a favorite Chinese narrative that the U.S. is a declining power flailing about in a world where it can no longer bully others—while China is a peace-loving nation without territorial aspirations beyond its own borders. Chinese foreign minister Wang Yi told CCTV that he chided the U.S. for its belligerence in a phone call with U.S. secretary of state Antony Blinken in a phone call Monday. “Using force and military means to resolve problems will just increase them. The lessons of this deserve serious reflection,” Wang reportedly told Blinken.

But beyond the gloating, Beijing’s attitudes about America’s departure from Afghanistan—and the surprising speed with which the Taliban has seized control of the country—are complex.

In theory, America’s exit creates an opportunity for China to fill the vacuum left behind by the U.S. and expand Chinese influence in a mineral-rich neighbor. And yet the Taliban’s ascent creates what The Diplomat‘s Shannon Tiezzi calls a “nightmare” scenario for China: an extremist Islamic government in control of a country that shares a 47-mile border with China’s Xinjiang province.

And so, even before Biden announced plans in April for a U.S. withdrawal from Afghanistan, China has tried to hedge its bets in the country by maintaining good relations with both the Afghan government and the Taliban at the same time.

As Sam Dunning notes in this essay in Foreign Policy explaining the history, culture and geography of the Wakhan Corridor, the 217-mile long panhandle that ends in Afghanistan’s short border with China: while China “uses supposed Islamist extremism to justify the Xinjiang crackdown,” it also “has little problem dealing with the Taliban.”

That balancing act was on display in recent weeks as the Taliban’s takeover gained momentum.

In June, Wang joined a video “dialogue” with representatives from Pakistan and the government of Afghanistan’s then-president Ashraf Ghani, in which he dangled the prospect of “substantially expanding” into Afghanistan the “Belt and Road”—the Chinese network of trade and infrastructure links connecting Asia, Europe and the Middle East—to include Afghanistan. On July 16, Chinese president Xi Jinping reached out to Ghani directly with a phone call in which he stressed that China stood willing to play a “constructive role” in supporting dialogue between the Afghan government and the Taliban.

Two weeks later, as the Taliban swept through city after city, China invited the Taliban leaders, including Mullah Abdul Ghani Baradar, to meet with Wang in Tianjin. There Baradar promised that the Taliban “will never allow any force to use the Afghan territory to engage in acts detrimental to China.” Wang reciprocated by hailing the Taliban as an” important military and political force in Afghanistan.”

China’s diplomats have found even nicer things to say about the Taliban now that the group controls Kabul. In a press conference in Beijing Monday, foreign ministry spokesperson Hua Chunying described the Taliban’s victory almost as though it had been a democratic election, telling reporters that “we respect the wishes and choices of the Afghan people,” and expressing optimism that the new government would “curb all kinds of terrorism and criminal acts, and help the Afghan people avoid war and chaos and rebuild their beautiful homeland.”

The reality is that Taliban rule in Afghanistan will create new hazards for Beijing. One source of anxiety will be Pakistan, a crucial Chinese ally whose leaders fear the Taliban comeback in Afghanistan will inspire jihadist extremists at home. China’s Belt and Road projects in Pakistan have increasingly become targets of attack by the Pakistani Taliban.

Chinese business plans in Afghanistan are likely to remain at risk. Both of China’s two main business investments in Afghanistan—one involving a copper mine and the other an oil field—are mired in difficulties. Raffaello Pantucci, a senior fellow S. Rajaratnam School of International Studies in Singapore argues in an essay for Nikkei Asia that the only recent example of successful commerce between the two nations is the creation of an air corridor to facilitate the export of Afghan pine nuts to China.

“The sad truth is that China is a missed economic opportunity for Afghanistan,” Pantucci writes. “And there is little chance that the instability that will follow a Taliban takeover is going to change that.”

More Eastworld news below.

Clay Chandler

This edition of Eastworld was curated and produced by Grady McGregor. Reach him at

Eastworld news


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Chinese entrepreneurs are growing increasingly wary of accepting funding from foreign investors amid China’s sweeping crackdown on its tech sector. Chinese start-ups have long relied on a complex VIE system to accept U.S. dollars from foreign investors, yet the dollar's appeal is now waning as China prepares to overhaul the VIE system and scrutinize how foreign funds enter the country. In August, Chinese Internet start-ups completed 23 RMB-denominated fundraisings compared to zero USD-denominated deals. In 2019, Internet start-ups raised nearly 80% of their funds in USD compared to just over 20% in RMB. Financial Times 

Bollywood rebound?

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Markets and movers

Bytedance – The Chinese government quietly took a stake in Bytedance when the tech giant sold a 1% stake in the firm to WangTouZhongWen Technology, a firm owned by three government entities, on April 30. The deal allows the Chinese government to appoint its own board director at Bytedance, but does not give the government a stake in TikTok.

Tencent Music – The music division of the Chinese social media giant is shelving plans to sell up to $5 billion in shares and acquire a listing in Hong Kong by the end of the year. Tencent Music may go through with its de-facto secondary listing in Hong Kong next year once market pressures related to China’s crackdown on its tech sector have eased.

Reliance – Oil giant Saudi Aramco is in talks to acquire a 20% stake in Indian conglomerate Reliance Industries’ oil refining and chemicals business for $25 billion. The deal would seal more than two years of negotiations and forge closer ties between the world’s largest oil exporter and one of the world’s fastest-growing economies.

Sydney Airport Holdings – Sydney Airport rejected a $16.8 billion takeover bid from a group of infrastructure investors dubbed the Sydney Aviation Alliance, but said it was open to a higher offer. Sydney Airport rejected a $16.6 takeover bid from the same group of investors last month. A potential deal would become one of the largest buyouts ever of an Australian firm.

Thai Airways – Thailand’s flagship airliner posted a net profit of $331 million in the first half of 2021, the firm’s first time the firm posted a net profit since the beginning of the COVID-19 pandemic. To achieve profitability, Thai Airways sold off assets, reduced its headcount, and slashed employee benefit packages.

HSBC – The London-based bank is acquiring the Singapore insurance business of French rival AXA for $575 million as HSBC boosts its presence in Asia and shifts away from markets like the U.S. and Europe.

Hong Kong – On Monday, the financial hub deemed the U.S., France, and 14 other countries as high-risk places for COVID-19 on Monday, subjecting residents that travel to those locations to mandatory 21 day-hotel quarantines upon returning to Hong Kong. The new restrictions may help Hong Kong continue to avoid a Delta-driven outbreak, but threaten to further isolate Hong Kong from the rest of the world.


Final figure


Firms like Goldman Sachs, Morgan Stanley, and Nomura have downgraded their forecasts in recent weeks for China’s GDP growth in 2021 from a 8.6-8.9% range earlier this year to 8.2-8.3% growth amid China’s recent Delta outbreak. China’s latest economic data confirm that its recovery is indeed losing steam. On Monday, China reported that retail sales in July, a measure of domestic consumption, grew by 8.5% compared to one year ago, down from a June increase of 12.1%. Growth figures for industrial production and fixed-asset investments similarly lagged, while unemployment ticked up from 5.0% in June to 5.1% in July. China's sluggish growth prospects may leave it struggling to catch up with the U.S.' rapidly recovering economy.

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