China in the Asia-Pacific

by Alberto Di Felice

September 2007

Introduction

In the post-Cold War era, China is arguably the potentially most destabilizing actor in world politics. Certainly, it is the most dynamic force in terms of economic growth and a political power in the Far East. The rising giant is a source of concern for the international community, and especially for the other dominant actors in the Asia-Pacific region—notably, the U.S. and Japan. According to classical realist thinking, China has the potential to, and indeed is destined to, influence the region’s military balance as well as existing regional relationships. The reason for this is that, as China modernizes and expands its economy, it will naturally seek to increasingly project and extend the scope of its influence on the international political scene, emerging as a challenger to U.S. global hegemony.
The complex dynamics at play in the Asia-Pacific have so far been dependent upon the driving and constraining force which, since the end of the Cold War, the United States has continued to exert in engaging with the East Asian region in both economic and security arenas. It has done so through a web of multilateral international institutions, such as the Asia-Pacific Economic Cooperation (APEC), and bilateral alliances designed to protect its interests and those of its strategic partners, such as the U.S.–Japan Security Treaty and the U.S.–South Korean Treaty of Mutual Defense. Causing China anxiety and uneasiness are especially the security alliance between the U.S. and China’s historical rival in the region, Japan, and that between the U.S. and what China considers to be its “renegade province,” Taiwan.
The key question which puzzles political analysts and political leaders alike is whether China will in fact fulfill the realist prophecy by engaging in open confrontations with its political and economic rivals, finally reshaping the balance of power in the region—and eventually beyond. The answer to the question “Will China challenge the status-quo?” ultimately depends on the set of assumptions that one adopts about current and future intentions shaping the minds of the leaders in the countries involved.
This essay will briefly focus in turn on the three countries that are most relevant to Chinese ambitions in the Asia-Pacific region: the United States, Japan, and Taiwan. It will conclude that, although multiple potential clashes threaten to break out at any time to shake the stability of the region, self-interest—measured mainly in economic terms—is nonetheless likely to call leaders to moderation in repeated cycles of confrontation and compromise.

China and the United States

China’s complex connections with the United States are the most important factor shaping its international ambitions. The nature of the relationship between China and the United States cannot be understood only in the light of one interpretative criterion, in that it is shaped by a plurality of questions awaiting to be settled. Namely, the two giants are in more or less overt confrontation over the issue of Taiwan, and China’s bilateral relationships with other countries in the Asian region are deeply influenced by the relationships these countries have with the U.S.
The foreign relations of both countries are characterized by some distinguishing patterns that can be outlined. The political succession from Mao Zedong to Deng Xiaoping has imposed an anti-ideological turn on Chinese politics, making it more pragmatic and willing to sit on the fence. This practical, matter-of-fact way of approaching international relations makes the current relative weight of China the key element that the Chinese leadership has to assess and manage. In point of fact, despite China’s economic success and its growing spending on arms and military equipment, its overall position is weakened by its still inferior development in terms of science, technology, education and armed forces. [1] Significantly, the highest Pentagon estimate for China’s military expenses still adds up to only one fourth of the U.S. military budget. [2] So long as the aforementioned weaknesses are not promptly eliminated, China’s defense modernization program cannot go hand in hand with immoderate political assertions.
On the other hand, the attitude of the Bush administration toward China has changed since its inception. Initially it promised to show determination to challenge China on a number of issues—e.g., trade, military and strategic interests, human rights; ultimately, it has adopted a balanced approach combining concessions, firmness and dialog. The September 11, 2001 WTC and Pentagon bombings were the event that altered the American strategy, bringing the goal of the war on transnational terrorism to the foreground and urging to forge a large network of alliances which included China. Former Chinese president Jiang Zemin immediately showed eagerness to cooperate after the attacks and both countries concurred on the need to push North Korea to abandon its nuclear-weapons program. [3]
The relationship between the two countries is all but free from frictions. The economy (e.g., strong interdependence accompanied by commercial battles, America’s perception of overvaluation of the yuan) [4] is not the only area where disagreement and hostility exist. Military issues are a major concern. The United States sees the evident technological progress of China in the military domain, along with China’s imports (mainly from Russia) of military equipment, as a threat to its own security and that of its closer allies. As a consequence, the U.S. exerts a high degree of control over its exports of high technology to China, in order to curb nuclear proliferation and to restrict the availability of technologies designated for both civil and military use. As can be seen, the U.S.  pursues a dual policy of political engagement and military containment toward China, and continues to expand its military alliances in the Asia-Pacific region as it interprets Beijing’s intentions. [5]
China, on the other hand, is aware of this policy of containment of its military capabilities, and of America’s apparent determination to maintain a unipolar order in the region versus China’s preference for multipolarization. However, the only weapon available to the People’s Republic at the moment is sangfroid and composure, in particular by avoiding anti-American sentiment (which it is nonetheless ready to ignite, as the accident of the American bombing of the Chinese embassy in Belgrade during the NATO air strikes of 1999 shows) and using diplomacy while manifesting disappointment when needed.

China and Japan

It can be said that China and Japan have never been in an equal position, the balance of power shifting toward one country or the other over time. China held a hegemonic position as the hub of a Sino-centric system in East Asia up until the mid-nineteenth century when, after the “unequal treaties” and until after World War II, Japan established its political and military supremacy; when its military power faded, the supremacy of Japan became predominantly economic since the 1950s to the 1990s, while military superiority was guaranteed by the alliance with the U.S. From the 1990s, however, the Japanese economy underwent structural change from a high to a low growth rate or even stagnation, in contrast to the Chinese economy growing at a rapid pace. From this respect, the Asian crisis of 1997—which China was able to escape, most importantly because it did not have as full capital account liberalization as the affected countries—was a turning point. [6]
Presently, China and Japan are competing for the role of major political and economic actor in the Asia-Pacific. There are a series of economic and strategic issues which contribute to the existence of rivalry and distrust between the two countries. This is particularly true for China, which is not likely to forget long-past humiliations any time soon, a feeling resentment which is indeed shared by other former Japanese colonies in Asia—most notably, South Korea.
China is becoming the center of a new phase of economic growth in the region through the strategic establishment of a series of free-trade agreements with ASEAN countries, to be commenced as of 2010, and other bilateral agreements which it has planned or negotiated with Australia, New Zealand, India and Pakistan. [7] Japan, by contrast, has historically been more prone to multilateralism, but has been forced to change its policy because of China’s aggressiveness. Nonetheless, it still lags behind due, in the main, to the opposition of its agriculture lobby to opening up the market in this key sector. [8]
A key issue in China-Japan relations is the reopened question of Japanese rearmament, which impacts on China’s perceived security environment no less than the issue of Taiwan, to which we will turn in the next section. Once again, it can be seen how American influence shapes Chinese ambitions.
After World War II, Japan was forced by Article 9 of its Constitution to “renounce war as a sovereign right of the nation and the threat or use of force as means of settling international disputes,” and the Japanese armed forces were devoted exclusively to self-defense. With the end of the Cold War, debate over the Japan–U.S. security relationship surfaced. American strategists are discomfited by Japan’s defense policy, which is limited to self-defense of its own territory, and therefore advocate a revision of the Japan–U.S. security arrangements and a phased reduction of U.S. troops in the region, which they tend to regard as of secondary importance especially in the new post-9/11 scenario. The United States has long backed constitutional change so as to allow Japan to play a larger military role as part of their security alliance, particularly after the terrorist attacks on New York and Washington, in an attempt to adjust Japan’s defense policy in line with the post-Cold War security environment of Northeast Asia. Following this, in 2001 the Japanese Parliament passed a bill—the Antiterrorism Measures Special Law—allowing for backup operations against terrorism. [9] Earlier this year, another bill was passed authorizing a referendum to reform Article 9. [10]
Two concurrent incentives may facilitate Japanese militarization. Firstly, the Bush administration has reconfigured its military engagement to suit its new strategy in the so-called war on terror. In spite of America’s reassurance that its support to Japan must be measured not by the number of troops but by technological capabilities, this may cause the Japanese leadership to doubt the effectiveness of American military protection. Secondly, China’s military growth could be perceived as a threat to Japanese sovereignty. [11]
In any case, China clearly does not see these developments in a positive light, as the reemergence of Japan as a military power would be considered to be a move to isolate China diplomatically and militarily. The reaffirmation of the Japan–U.S. security relationship was formalized with the new U.S.–Japan Defense Cooperation Guidelines of 1997, which opened the door for Japanese forces to intervene militarily abroad. Such alliance seems to strengthen the United States as the hub, and the Japan–U.S. security arrangements as the main pillar, of the American scheme for maintaining stability and prosperity in the Asia-Pacific region. In combination with the alliance with Taiwan, it is read as part of an ostensibly hostile strategy.
As can be seen, economic interdependence has brought about little reconciliation, and anti-Japanese sentiment still runs as a strong component of Chinese nationalism.  Despite the many issues on which the two countries find themselves cooperating (Japan is also involved in the six-party talks over the North-Korean nuclear program; both countries, along with South Korea, are members of ASEAN+3; Japan was a major sponsor for Chinese accession to the WTO), they remain distant and in contention—more so (probably only) on the Chinese side. However, both countries have multiple ties with the economies of all or most of the countries in the region, and—perhaps most importantly—can hardly ignore each other’s importance: Japan is China’s first largest trading partner, while China is Japan’s second largest trade partner. [12]

China and Taiwan

The Taiwan issue is, and indeed has been even since before the birth of the People’s Republic, of fundamental importance in Chinese politics. It will be sufficient to recall that following the Shimonoseki Treaty of 1895, China was forced to surrender the island to Japan.
Taiwan has been, and is, a reason for friction between China and the United States, beginning with the initial appointment of the Taipei government as legitimate representative of China at the United Nations and its consequent permanent seat in the Security Council. China’s seat was transferred to the Communist government in Beijing only in 1971, and the U.S. switched recognition from Taiwan to the People’s Republic only in 1979. At present, Taiwan still calls itself the Republic of China. The nature and scale of friction between Washington and Beijing casts a shadow of concern on the future security environment of the Asia-Pacific region, yet the two countries are not on a one-way collision course.
A long history of deep-seated animosity shows that Taiwan is an extremely complicated and delicate problem for the Chinese leadership. Depending on how this problem is managed, it could result in a conflict between China and the United States. Beijing has made it clear that it has not removed from consideration the use of military force in a matter it considers related to sovereignty and national unification, and that it will use force to delay, hinder, or prevent any action by Taiwan that would considerably move the island toward de jure independence. Such a use of force would, in turn, embroil the United States and a reluctant Japan.
The United States is wary of China’s rapid military build-up, and continues to support its Taiwanese ally politically and to provide it with military supplies. China, on the other hand, has never abandoned the goal of eventual reunification, especially after the successful repatriations of Hong-Kong in 1997 and Macao in 1999, and keeps deploying an increasing number of short-range ballistic missiles—bought mainly from Russia—opposite Taiwan. [13] In reality, the probability that military action may ensue is limited for at least two major reasons.
First, the importance of reciprocal economic relationships between the mainland and Taiwan is clear to both sides. Bilateral trade is increasing at high speed, along with direct investment from Taiwan to China—especially because of the wave of delocalization of labor-intensive industries, but also in the form of joint ventures. [14] A simple cost-benefit analysis should discourage both parties from entering into conflict, especially in the light of the pragmatism of the fourth generation government in Beijing.
Second, notwithstanding its military aid, the American administration, along with Japan, has implicitly espoused the one-China policy by repeatedly expressing its opposition to any actions or comments on the part of the Taiwanese government aiming to unilaterally change the existing state of affairs and make its de facto independence permanent, such as the prospect of a referendum on United Nations membership. [15] Keeping the Taiwan issue vague seems to best meet U.S. interests, allowing Washington to have more bargaining chips when negotiating with Beijing. In addition, on September 19, 2007, the UN blocked Taiwan’s quest for membership for the 15th consecutive year. [16]

Concluding remarks

As the foregoing discussion has tried to show, no simple definitions apply to the relationships involving China and the other main actors in the region. Each subjective evaluation of relative significance in regional dynamics is not unambiguous, as it is dependent upon conflicting aspirations and needs—the most pressing of which, in the case of China, are political and strategic preponderance and economic welfare.
China undoubtedly considers the Far East its backyard, and is actively modernizing and increasing the size of its defense capability while creating its own web of connections, both in its periphery and more widely, to advance its interests as its economy grows; Japan is trying to keep pace with China’s industrious activity in these fields while feeling uneasy and concerned about its future role as a political and economic power; the United States proceeds doggedly, checking the expansion and influence of a potentially hostile China, by giving more force and effectiveness to its strategic alliances in support of Japan and Taiwan; Taiwan shows resistance toward any signs of weakness to Chinese pressure and aspires to finally having its independence formally secured, but must be watchful to avoid violent reaction from the resentful mainland.
As realists argue, the nature of these conflicts is structural. Few would contend that China does not see the current configuration of its neighboring environment as tending or serving to restrict its action. China clearly sees the United States committed to minimizing Chinese accomplishments in the region. The threat that China poses to global and regional stability, however, cannot be readily assessed in terms of the diffidence of the Chinese leadership. Rather, we should turn to the overall objectives of the Chinese government to see if military assertiveness is able to meet them.
Beijing adopts an essentially realist perspective on what happens on the international stage, and comprehends the nature of the security dilemma it faces: as long as China lacks the necessary strength, it is likely to fall under U.S. pressure. Leaders in China view the American unipolar world as inherently threatening. China is therefore willing to do what it can to balance against American superiority, in the attempt to promote a multipolar system in which the balance of power in the region would gradually be offset and shift away from the U.S.
But if rivalry is certain, a state of open, armed, and prolonged conflict is not. It is certainly very difficult to make the contrasting positions of the rising new entrant and the incumbent powers compatible. There is room, however, to be hopeful that economic interdependence and domestic political liberalization will moderate Chinese demands in order to successfully and peacefully accommodate them into American and Japanese interests.
As we have already noted, China’s new generation of leaders has generally adopted more instrumental policies than in the past, giving preeminence to economic growth and the domestic political situation. Chinese pragmatism is predominantly reflected in the self-proclaimed “peaceful rise” which China is willing to adopt as a strategy for the development of its domestic economy and for the conduct of its foreign relations. The continuing high rates of growth of the Chinese economy have called attention to the importance of stable circumstances and conditions to stimulate and sustain development. History itself, after the Opium Wars and the “unequal treaties,” has raised China’s awareness that without economic prosperity the use of military strength can only cause humiliation. [17] The People’s Republic has its own development plan, but its realization must necessarily be peaceful and requires a stable international scenario. China, therefore, cannot bear wars and conflicts on the international scene without disadvantage, and is willing to avoid them.

NOTES

1. See Michael G. Gallagher, “China’s Illusory Threat to the South-China Sea,” International Security, Vol. 19, No. 1, Summer 1994, pp. 169–94; Solomon Karmel, China and the People’s Liberation Army: Great Power or Struggling Developing State? (London: St. Martin’s, 2000); Bates Gill and Michael O’Hanlon, “China’s Hollow Military,” National Interest, No. 56, Summer 1999, pp. 55–62. [↩]
2. “The Military Power of the People’s Republic of China,” Report to Congress, Office of the Secretary of Defense, United States Department of Defense, July 2005, p. 22. [↩]
3. See David M. Lampton, “Small Mercies: China and America after 9/11,” The National Interest, Winter 2001/02. [↩]
4. See Bonnie S. Glaser, “Rice Seeks to Caution, Cajole, and Cooperate with Beijing,” Comparative Connections, Vol. 7, No. 5, April 2005, http://www.csis.org/media/csis/pubs/0501qus_china.pdf. [↩]
5. See U.S.–China Security Review Commission, The National Security Implications of the Economic Relationship between the United States and China, July 2002, pp. 167–77. [↩]
6. See John G. Fernald and Oliver D. Babson, “Why Has China Survived the Asian Crisis So Well? What Risks Remain?,” International Finance Discussion Papers 633, Board of Governors of the Federal Reserve System (U.S.), 1999, http://www.federalreserve.gov/pubs/ifdp/1999/633/ifdp633.pdf. [↩]
7. See Agata Antkiewicz and John Whalley, “China’s New Regional Trade Agreements,” NBER Working Papers 10992, National Bureau of Economic Research, Inc., 2004, http://www.nber.org/papers/w10992.pdf. [↩]
8. “The Japan Sindrome,” The Economist, May 10, 2007. [↩]
9. “Japan military support bill approved,” CNN.com, October 29, 2001, http://archives.cnn.com/2001/WORLD/asiapcf/east/10/29/ret.japan.law/index.html, accessed September 21, 2007. [↩]
10. Norimitsu Onishi, “Japan to Vote on Modifying Pacifist Charter Written by U.S.,” New York Times, May 15, 2007. [↩]
11. See David Twining, “America’s Grand Design in Asia,” The Washington Quarterly, Vol. 30, No. 3, Summer 2007, pp. 80–1. [↩]
12. See David Kruger and Ichiko Fuyuno, “Innovate or Die: Reinventing Japan,” Far Eastern Economic Review, April 25, 2002, pp. 28–34. [↩]
13. See “US reports China missile build-up,” BBC News, http://news.bbc.co.uk/2/hi/asia-pacific/4698655.stm, accessed September 21, 2007. See also Denny Roy, “Tensions in the Taiwan Strait,” Survival, Vol. 42, No. 1, Spring 2000, pp. 76–96; June Teufel Dreyer, “Flashpoint: The Taiwan Strait,” Orbis, Vol. 44, No. 4, Autumn 2000, pp. 615–29. [↩]
14. See See David Murphy and Maureen Pao, “A Place to Call Home,” Far Eastern Economic Review, July 5, 2001. [↩]
15. See “US reiterates opposition to Taiwan’s plan to hold UN referendum,” Taipei Representative Office in the UK, July 2, 2007, http://www.roc-taiwan.org/UK/ct.asp?xItem=38698&ctNode=3244&mp=132&nowPage=1&pagesize=1000,  accessed September 21, 2007. [↩]
16. See “UN rejects membership for Taiwan,” BBC News, September 19, 2007, http://news.bbc.co.uk/1/hi/world/asia-pacific/7003811.stm, accessed September 21, 2007. [↩]
17. See R. G. Tiedemann, “Chasing the Dragon,” China Now 132, Winter 1989/90. [↩]