Will China Pay Trillions of Dollars for its Coronavirus Mistakes?

In light of the current Coronavirus crisis which countries are still suffering from its repercussions, the list of countries demanding China to pay for its Coronavirus mistakes is getting longer; claiming that China is responsible for the outbreak of the virus, presented disingenuous preventive means, or reported misleading numbers of its human losses. Will China prevail in the world - as some predict - in the post-Corona phase? Or will it lose its place as a superpower after this crisis?

by Hasan Ismaik
  • Publisher – STRATEGIECS
  • Release Date – Apr 27, 2020

The list of countries demanding China to pay for its Coronavirus mistakes is getting longer, claiming that China is responsible for the outbreak of the virus, presented disingenuous preventive means, or reported misleading numbers of its human losses.

The Coronavirus epidemic is considered an international health crisis which was later announced as a pandemic by WHO, following its spread from Wuhan, China, to the rest of the countries. As the world struggles today to contain this pandemic, which has led to the deaths of thousands and the disruption of economies worldwide, a new and perhaps fiercer battle is about to start between countries for which the pandemic created both internal and external challenges, whilst exchanging accusations holding each other responsible for the virus outbreak.

Many western countries accuse China that it was and still hides information about the source of the virus and provides false information regarding symptoms, effects on humans, and ways of transmission. It even lies regarding the number of its infected citizens and the number of deaths caused by it. What makes this closer to the truth is reports stating that Wuhan, the epicenter of the outbreak, has altered the number of deaths, with an abrupt increase of 50%. This is considered new evidence that China hides more than it actually has in this epidemic, therefore, must pay for its mistakes.

The Chinese Virus

Since the start of the crisis, U.S. President, Donald Trump held Chinese authorities responsible for the spread of this virus first found in Wuhan city, China, as he kept referring to the virus as the “Chinese Virus” whenever he had a chance to do so.

Despite coming under harsh criticism mostly related to racism, over time, the term "Chinese virus" started to gain momentum in U.S. circles, as China acted irresponsibly when it left the door open to the virus to spread all over the world.

As for China, this outbreak constituted a chance to improve the way it is perceived by the entire world, as it showered European countries fighting the virus with aids as part of a diplomatic campaign to win alliances and portray itself as the world savior. Nonetheless, China faces today - in an unwelcome transformation - a clear strategy from several countries to blame and suspect its true intentions, which in turn might undermine China's aspirations to become a global economic and political power.

Doubts Hovering Over China

After nearly 4 months of the new Coronavirus, recent reports accuse China of participating in the spread of the virus, whereas others claimed that China allowed the virus to spread to showcase its strength to the world, while some reports publicly suggested that Wuhan Lab is the source of this virus.

This debate was not limited to media as it has been present in some statements by high officials; Trump, himself, reiterated during a press conference that his country has initiated a comprehensive investigation to locate the source of the virus. From its side, CNN confirmed this reporting that U.S. intelligence is investigating it. Meanwhile, U.S. Secretary of State Mike Pompeo told Fox News that Beijing is required to disclose everything it knows about the spread of the Covid-19 virus, hinting at a particular responsibility of the Wuhan Institute of Virology, where the virus first appeared.

Lack of Transparency

The official U.S. narrative was mentioned in a report published by Fox News about the inevitability of the existence of a way through which the new Coronavirus leaked from a laboratory in Wuhan, where the disease first appeared in late 2019. At the time, lab researchers were studying coronary bat viruses, which the Chinese government covered up by blaming the seafood market and refusing to allow any independent investigation.

Although European accusations seem less harsh compared to those by the U.S. and despite the virus emergence, European governments criticized China for showing a lack of transparency, hiding information, failing to announce the true scope of the epidemic, and hindering the efforts of countries to respond to this pandemic promptly. This was confirmed by French President Emmanuel Macron in an interview with the Financial Times, as he mentioned that there are holes in China’s management of the emerging “Coronavirus” crisis and that there are things that have happened that we have yet to know. Furthermore, Macron pointed out that in democratic systems that guarantee freedom of information and expression, crisis management is to be transparent, and under discussion; this is how Europe believes China has endangered the public health and caused economic imbalances, which is irrelevant to holding it accountable for the spread of the virus.

China denies all these accusations as Chinese Foreign Ministry spokesman Zhao Li Jian said: "I want to remind you that the head of the World Health Organization (WHO) has stated many times that there is no evidence that the new coronavirus was produced in the laboratory".

Legal Liability

With the outbreak of the Coronavirus in Wuhan, Chinese authorities have made clear and deliberate misinformation about the virus, and world countries agree that it was possible to save China and the world from thousands of deaths had China acted openly and in accordance with its legal obligations as one of the 194 countries in the 2005 International Health Regulations. These regulations stipulate the duty of China to promptly collect information and contribute to explaining what could constitute a public health emergency with potential international impacts, as Article 6 of the International Health Regulations requires countries to provide quick information on time, so that this information is accurate and sufficiently detailed to the World Health Organization, to prevent the spread of epidemics.

There is a growing consensus in the U.S. between Republicans and Democrats that the Chinese government bears responsibility for spreading the virus, by China blocking basic information for weeks, during which other countries could have taken adopted measures to stop the spread of the virus.

More than a month after the crisis erupted, Pompeo accused the Chinese government of still withholding key information, and these accusations became more valid in early April when the CIA questioned Beijing's official statistics on the extent of the virus outbreak in China.

Defendant Government

Moreover, many people in the U.S. and the world are turning to judicially hold China accountable; former Florida senator and director of government relations for the Berman Law Group, Joseph Abruzzo, said that the outbreak could have been contained, but Chinese officials tried to hide the truth and provided a positive account of the virus. For his part, the co-founder of the group, Russell Berman, indicated that the Chinese government is a defendant, and it must pay huge compensation to the U.S. and its people.

The British Henry Jackson Association issued a report in which China is demanded, under international law, to pay $6.5t, for it has concealed the initial information about the virus, causing more than 165 thousand deaths so far, and the loss of trillions of dollars in economic terms, as a result of the closures that prevailed in most countries around the world.

Claims in Numbers

According to the British newspaper "Express", Germany asked China to pay €149b, equivalent to $160b, which is the value of its losses from the Coronavirus crisis so far. The bill detailed some of the Germans' losses, including a €27b loss of returns from the tourism sector, €50b in compensation for the losses of small German enterprises, and €1m per German Lufthansa airline stoppage hour.

In case the German economy loses 4% of GDP, this means a loss of approximately €1,800 per German citizen.

In response, China described the German bill with stoking xenophobia and promoting German nationalism. 

In Australia, Minister of Home Affairs, Peter Dutton, called on the Chinese authorities to disclose information about the source of the virus; it is reported that the virus has killed 60 Australians, whereas hundreds of people are in critical condition, and that all of these families want to receive honest and transparent answers.

He added, "I don't think it's too much to ask... I think it is incumbent upon China to answer those questions and provide the information so that people can have clarity about exactly what happened because we don't want it to be repeated.. and, we know that this is not the first instance of a virus being spread from the wildlife wet markets and we need to be honest about that".

Non-Great China 

Many assumed that the West’s chaotic response to the virus might allow China to create a vacuum in global governance, as this pandemic demonstrated the failure of the U.S. administration to provide any meaningful international response, and reflected the European Union’s preoccupation with the domestic response only, providing an opportunity for the Chinese authorities to exploit this situation.

Besides, these conditions provided an opportunity for China to rewrite the Coronavirus outbreak narrative, in an attempt to distance criticism related to its initial attempts to cover up the spread of the epidemic and pretend it is ready to save the world given its successful experience controlling the virus.

Nonetheless, China's attempts to take advantage of the situation have proven to be early attempts, and it may reflect negatively on China and leave it in isolation. This might also lessen its confidence - the confidence which took China decades of gradual progress to build in the international system, rising to become the second superpower in the world. This might also significantly affect the reforms that lifted hundreds of millions of Chinese out of poverty and helped China ascend to the global arena, considering that these achievements and results would not have been achieved without the participation and support of the international community.

Shaky Confidence

In reality, this confidence has been shaken with growing accusations against China over the global Coronavirus epidemic, ending the role China has played as an international leader for nearly 30 years.

The effects of China’s response to the Coronavirus pandemic are starting to appear; in Britain, prominent conservatives called for rethinking Britain’s efforts to strengthen ties with China, demanding that the British government denies Huawei's rights to create infrastructure for fifth-generation technology, which the U.S. has long opposed, claiming that it is spying networks for the Chinese government.

By the same token, European and Australian governments quickly prevented Chinese companies from cheaply purchasing assets amid economic meltdowns, whilst Japan explicitly allocated $2.2b to help Japanese companies move supply chains out of China.

Chinese Pressures on Europe

China does not stand still in the face of what is being planned against it globally; Reuters reported that four diplomatic sources and correspondences said that China had sought to prevent an EU report saying that Beijing had published false information about the outbreak of the Coronavirus.

The report was eventually published, albeit just before the start of the weekend in European time, with some criticism of the Chinese government being rearranged or deleted, in a sign of the balancing process that Brussels is seeking to achieve with the impact of the Coronavirus outbreak on international relations. For instance, on the first page of the internal report shared by EU governments on April 20, the European Union’s foreign policy arm said, “China has continued to run a global disinformation campaign to deflect blame for the outbreak of the pandemic and improve its international image. Both overt and covert tactics have been observed”. However, the version that was published on Friday does not contain this phrase or was refined to accommodate Beijing’s stance.

Four diplomatic sources told Reuters that the report was originally due to be released on April 21, "but was delayed after Chinese officials picked up on a Politico news report hat previewed its findings".

According to EU diplomatic correspondence, a senior Chinese official contacted European officials in Beijing on the same day to inform them that "if the report is as described and it is released today it will be very bad for cooperation".

"The publication of the report will make Beijing very angry," the correspondents quoted Yang Xiaoguang, an official with the Chinese Foreign Ministry, and accused European officials of trying to please "someone else " - which was understood by the EU diplomats as a reference to Washington.

Post-Coronavirus World

In conclusion, at a time when many expected that a "post-Coronavirus world" might be dominated by China, global developments show that such an assumption was premature and that the reality of the crisis is showing a rapidly changing situation witnessed by the world. While China has emerged as a savior of the world, and Chinese diplomatic and media campaign began to bear fruit, the magic turned on the magician. Today, China faces an unprecedented historical challenge, which will not only affect its global image and reputation but may reach the point where China becomes required to pay countries of the world compensations in hundreds of billions of dollars. As such, the future may carry darker crises that shall not be in China's favor, especially with countries searching for the source of such a virus.

The two most important questions here: Will Arab states join the list of claimants of trillions in compensation, or will they remain neutral? and will China acquiesce under global pressures and pay trillions of dollars which it spent years in collecting, and backtracking what was known as the economic miracle twenty years back?


Hasan Ismaik