China’s leaders appear to make national decisions based on a set of strategic priorities, which include perpetuating CCP rule, sustaining economic growth and development, maintaining domestic political stability, defending China’s national sovereignty and territorial integrity, and securing China’s status as a great power. PRC strategy is one of maintaining balance among these, at times, competing priorities. China’s leaders describe the initial decades of the 21st century as a “strategic window of opportunity,” meaning that regional and international conditions will generally be conducive to China’s rise to regional preeminence and global influence, and seek to prolong that window of opportunity as much as possible.

China’s leaders have reaffirmed and continue to support “reform and opening,” which began in 1978 as the fundamental basis for China’s overall strategy and policy. However, two central perceptions increasingly appear in senior PRC leadership statements and commentary, suggesting a growing recognition that the process of “reform and opening” has engendered several contradictions and challenges:

First, reforms have enabled China to experience rapid growth in economic, political, and military power, but have also led to significant new challenges to internal stability.

Second, reforms have increasingly propelled China into a global security environment in which external events can no longer be isolated from their effects on China’s internal situation, and vice versa.

These dual perceptions have led Party leaders to conclude that, through 2020, they should focus on managing or exploiting external tensions, especially with the great powers, to maintain an environment conducive to China’s development. Beijing’s growing economic stature partly drives a more active external posture in which it demonstrates a willingness to assert its interests, while taking on a more active role in resolving disputes and promoting regional cooperation. In a significant departure from prior language, China’s 2008 Defense White Paper maintains that:

“China has become an important member of the international system and the future and destiny of China have been increasingly closely connected with the international community. China cannot develop in isolation from the rest of the world, nor can the world enjoy prosperity and stability without China.”

Nonetheless, there are forces—some beyond the control of China’s leaders—that could reinforce a relatively inward focus, or that could divert China from a peaceful pathway:

Nationalism: Communist Party leaders continue to rely on nationalism, based on China’s economic achievements and increased international profile, to improve the legitimacy of the Party. However, this approach contains risks. Although China’s leaders have stoked patriotic sentiment to manipulate public opinion and deflect domestic criticism of the CCP, they are aware that these forces can be difficult to control once begun and could easily turn against the state.

Economics: Continued economic development remains the foundation of the Party’s popular legitimacy and underwrites its military power. Unexpected increases in resource demand, global resource shortages or price shocks, or restricted access to resources, could affect China’s strategic
outlook and behavior, and might force its leadership to re-examine its resource allocation priorities, including those for the military.

Domestic Political Pressures: Regime survival and the maintenance of CCP rule shape the strategic outlook of China’s leaders and drive many of their choices. The Communist Party continues to face long-term popular demands for improved government responsiveness, transparency and accountability, which weakens its legitimacy.

Demographic Pressures: Demographic stresses will increase in the future, creating a structural constraint on China’s ability to sustain high growth rates.

Environment: China’s economic development has come at a significant environmental cost and China’s leaders are concerned that these problems could
undermine regime legitimacy by threatening economic development, public health, social stability, and China’s international image.

Cross-Strait Dynamics: Despite a reduction in tensions following the March 2008 election of Taiwan President Ma Ying-jeou, the possibility of a military conflict with Taiwan and U.S. military intervention remain the PLA’s most pressing long-term military concerns. A potential cross-Strait conflict will drive China’s military modernization as long as China’s leaders judge that the permanent loss of Taiwan could seriously undermine the regime’s political legitimacy and hold on power.

Regional Concerns: With China’s proximity and involvement in many of the world’s “flashpoints” (e.g., North Korea, the Spratly Islands, the Senkaku Islands, Afghanistan, and Pakistan), China’s leaders hope to prevent regional instability from spilling across China’s borders and thereby interfering with economic development or domestic stability. Changes in regional security dynamics—such as perceived threats to China’s ability to access and transport foreign resources, or disruptions on the Korean Peninsula—could lead to shifts in China’s military development and deployment patterns, likely with consequences for neighboring states.