In a recent article in the Australia, Greg Sheridan wrote “How China and its allies are winning the new cold war”. To slightly paraphrase one section, Sheridan wrote: “Beijing is taking every step to equip itself to fight a major war against the US. All the authoritarian (nations) have built, or are building, wartime economies. Almost all the democracies are half asleep. And it shows.”

Sheridan is largely correct. Most Western nations have either ignored, or simply don’t understand, China’s economic and military strategies. As an aside, we can also draw unmistakable parallels with Western disregard or ignorance of Russia’s ‘redlines’ regarding Ukraine and NATO – although the stakes are a lot higher when it comes to China.

Over the past 10-15 years, in particular, we (the West) have ignored or been too timid to counter China’s excesses, such as building islands in the South China Sea, because we wanted a continuing stream of cheap goods. We achieved that goal but missed the big picture although the Chinese haven’t been hiding their intentions.

Since President Xi came to power in 2012, the West seems to have misunderstood Xi’s oft stated words that China’s goal is “the great rejuvenation of the Chinese nation”. That isn’t some hollow patriotic slogan – he means it. And the goal is to be achieved by 2049 being the 100 year anniversary of the PRC.

And just to be sure the point got through, back on October 1st 2019, President Xi said in a speech marking the 70th anniversary of the PRC that: “Today a socialist China is standing in the east of the world and there is no force that can shake the foundation of this great nation.” He went on to say that reunification of China with Hong Kong, Macao and Taiwan was only partially achieved.

To achieve this unification and firmly establish China as the pre-eminent world power, China must continue to expand its base by forging partnerships that may disrupt or destabilise pre-existing localised alliances and undermine the international order.

One example of this was the ‘One Belt, One Road’ initiative which serves as a backbone to influence. Effectively, all projects are financed by the EXIM Bank of China with a loan ratio of 85% Chinese loan and 15% local government input. We know what often follows later is delayed debt payments resulting in transferral of local equity giving EXIM Bank (ie. CCP) control.

Alternatively, we have seen more direct actions some of which were characterised as ‘wolf-warrior’ diplomacy. China subsequently backed away from that approach only to replace it with new development loans or outright gifts such as roads, buildings and other infrastructure. Not in the Pacific, Africa and other places did this happen because China had a sudden rush of benevolence.

The point of these loans and other largesse is that Xi recognises that China’s plans to unification by 2049 cannot be achieved peacefully as core aspects of the prevailing international system are incompatible with its strategy. And, because the US is their main international competitor, China sees all US security alliances and partnerships, especially those in the Indo-Pacific region, as destabilising and irreconcilable with China’s sovereignty, security, and developmental interests. Thus, China’s efforts to foster widespread influence has a longer term goal of cultivating, and then choreographing, their community of allies.

This first stage of destabilising Western hegemony, and for China to meet its goals to become a “great modern socialist country”, is the applying of influence. Similar to Donald Trump recognised the ‘fly-over’ States as being ripe for the picking and consequent winning of the Presidential election in 2016, China has recognised that the West has largely ignored many nations whose ideology or geographical location is not deemed important enough. These must be cultivated as friends of China.

Other nations, including Australia, are subject to a periodic charm offensive from a Chinese delegation and we dutifully fall in line. Nothing too controversial is raised. We dare not raise the ire of China lest we suffer trade restrictions.

The second stage is for China to cement national rejuvenation and international status. Xi describes this as China being “the global leader in terms of composite national strength and international influence.” Couple this with a (planned) dominant world-class military and Xi’s words about China’s ascension to the top of the international order, and that China will establish a “community with a shared future for mankind”, should resonate within us.

Of course, there are some recalcitrants. Not everyone welcomes China’s vision of their global supremacy.

Skirmishes have happened and will continue to happen in the South China Sea and we can expect to witness far more Chinese naval activity in the Straits of Malacca, Celebes Sea and Sunda Strait. The recent naval interaction in the South China Sea between forces of the PRC and the Philippine navy is just another taste of the future. Pushing and prodding, the Chinese navy and Coast Guard will exert territorial pressure against other nations – many of whom have treaties with the USA – but the US won’t intervene at this low scale, and the Chinese know it.

On all the available data, it seems that it is only a matter of time before the military forces of the PRC sufficiently exceed those of the USA that China will feel able to fulfill her destiny. The Americans currently have a decisive military advantage in some elements (ie. aircraft carriers; helicopters, aerial refuelling) but how long will that advantage last? China is known to have four aircraft carriers at various stages of construction plus a litany of other military hardware. In any event, would the USA really go to war over Taiwan if China had six aircraft carrier groups loitering in the region? Hypothetical of course and time will tell, but there can be no doubting China’s rapidly expanding military strength.

If we ask ourselves who, other than the USA, could come to Taiwan’s rescue, there is no answer. No other nation, or even collection of nations, has the necessary capability without in-depth American involvement. Yet even with American involvement, Taiwan is incredibly vulnerable with a billion citizens fuelled with determined resolve to unite China once and for all, just 160km off the Taiwanese coast.

In any case, China is convinced that the assorted treaties between Taiwan and other nations will prove worthless in the face of Chinese militarily supremacy.

Meanwhile, China and Russia have drawn ever closer as Russia supplies China with inexhaustible quantities of raw materials and their world views coincide. Both see a new era of the East rising from the ruins of the failing West. Announcements such as the Russia/China ‘no limits’ declaration don’t happen by accident – it was a deliberate assertion of their view of the global future. To that end, China will endure Western barbs for not imposing sanctions on Russia over Ukraine as China has her eyes on the far larger objectives of global dominance and unification.

Which brings us to another aspect of Chinese preparations. It is well documented that the Chinese Central Bank has been adding to its gold reserves. In the past eighteen months it has purchased more gold than it had done in the previous fifty years. Further, in the past year or more, it has also been using its foreign currency reserves to buy gold instead of renminbi as they did previously. This means the Bank is reducing its stockpile of, and dependence on, the U.S. dollar. In a similar vein, China has been reducing its U.S. Treasury holdings. Those holdings have reduced from $1.1 trillion to $775 billion in a little over three years.

If all this sounds familiar, you’re right. Russia made similar moves (buying gold, selling down their foreign currency reserves) from 2012 to 2022 as well as the creation of the trading platform that mimics SWIFT (known as SPFS) for trade between countries.

Now of course, BRICS+ nations have moved to using their domestic currencies for trade between each other via SPFS – all of which will further shield China from dependence on the American dollar. Taken in isolation, these actions could be dismissed but given China’s stated goal, appear to be the start of a long road towards de-coupling, or insulation, from Western economic retaliation.

The point is that China is patiently making preparations for reuniting with Taiwan, by force if necessary. These preparations will take time as the Chinese military is not (yet) sufficiently formidable to fully dissuade the USA from military action. However, when the time comes, we can be sure that China will ensure she is militarily and economically insulated from Western reprisal.

Despite all the handwringing, we have done this to ourselves. For example, we had a chance to act as China built artificial islands around the aptly named Mischief Reef. No serious person believed China wouldn’t militarise those islands but the West was too intimidated and lacked collective resolve to invoke sanctions, much less a military response.

There are numerable quotes from President Xi about reunification with Taiwan, but I will leave you with this one. Speaking at an event marking the 110th anniversary of the revolution that overthrew China’s last imperial dynasty in 1911, he said he said unification in a “peaceful manner” was “most in line with the overall interest of the Chinese nation, including Taiwan compatriots.” So far so good, but then he went on to say “No one should underestimate the Chinese people’s staunch determination, firm will, and strong ability to defend national sovereignty and territorial integrity. The historical task of the complete reunification of the Motherland must be fulfilled, and will definitely be fulfilled,”

Xi is resolute and the West is very unlikely to have the capacity or will to withstand China. We should expect that Chinese school children will be singing songs about Xi as the great leader who united China and ushered in the bright dawning of the East. Listen for them on your radio – they will be played at the top of each hour before the news.