Finally, Xi has an incentive to work with America if it means buying him as much time as possible to prepare the economy for when the Trump administration’s trade action against China takes effect.

What’s next for China

Xi Jinping made it clear during his recent meeting with South Korea’s Moon Jae-in that he is opposed to war on the Korean Peninsula and that he prefers the North Korean situation be resolved through “dialogue and consultation.” The Trump administration, however, won’t hold talks with North Korea if Pyongyang continues with its nuclear brinkmanship. Conflict, should it erupt, will likely stem from American intervention to North Korean provocation. And while Tillerson recently said that America does not seek regime change and will “retreat back to the south of the 38th parallel” if it crosses the line, nobody can fully determine or foresee what will happen on the Korean Peninsula in the event of a clash. History offers a clue: Muammar Gaddafi’s Libyan regime and Saddam Hussein’s Iraqi regime collapsed after U.S. military intervention.

From one perspective, the end of the Kim regime is a win for Xi. Without a belligerent North Korea, the Jiang faction will lose a major provocateur and collaborator against the Xi leadership. Xi can then take bolder action against the remaining Jiang faction elites without being distracted or undermined by a nuclear North Korea. With the Jiang faction gone, Xi can more easily implement economic and political reforms in China.

On the flipside, the fall of the North Korean regime presents the Trump administration with an opportunity to pressure Xi to abandon communism. In his first speech at the United Nations, Trump openly condemned the “discredited ideologies” of socialism and communism. “America stands with every person living under a brutal regime,” he added. With countries increasingly voicing their concern and opposition to communist China’s subversion—an Australian lawmaker recently resigned over his links with the CCP—a U.S. campaign for China to end communism or face international pressure could prove popular and put Xi under tremendous pressure.

It is noteworthy that while Trump is anti-communist, his administration believes that Xi’s rule will turn out to be positive. “We think that President Xi will come out of [the 19th Party Congress] in a dominant position with incredible capacity to do good around the world,” Central Intelligence Agency director Mike Pompeo said in an interview. What Xi may do in the future is unclear, but the CCP will almost certainly face an existential crisis in the wake of the Kim dynasty’s collapse.

Don Tse is the CEO and co-founder of SinoInsider Consulting LLC, a consulting and research company based in New York City.

Larry Ong is a senior analyst with SinoInsider Consulting LLC.

This first appeared in RealClearDefense. 

Image: Reuters.