China: A Colossus in Asia?

 In Brazil, BRICS, China, Geopolitics and Global IR, Global Commons, Globalisation, Technology, and International Security, India, International & Transnational Affairs, SAARC, South East Asia, USA, Vidya Nadkarni

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Vidya Nadkarni December 10, 2017

China today is moving out of the shadows.  After decades of following Deng Xiaoping’s advice to “hide our capacities” and “bide our time,” Xi Jinping in his long address to the CCP’s 19th Party Congress in October announced that his country “has stood up, grown rich, and is becoming strong” and would move “closer to center stage.”  Xi celebrated the “steady progress” in China’s construction on the islands and reefs in the South China Sea—a self-back-patting that has disregarded the concerns of Southeast Asian claimants to the Paracel and Spratly island chains and troubled the United States. China, in Xi’s words is a “great nation,” and he implied a prominent global role for the country when he noted that history looked “kindly on those with resolve, with drive and ambition, and with plenty of guts.”  He could not have offered a clearer message to the world that China was claiming its proper due on the global stage.

China’s assertiveness is coming at a time when American allies and partners are increasingly questioning U.S. resolve and interest in global leadership.  President Trump’s “America First” strategy appears to many as a clarion call for a foreign policy strategy of retrenchment.  While the rhetoric of Trump administration officials continues to support US global engagement, the President’s position has been far less clear.  For instance, early in his administration Trump unceremoniously withdrew from the Trans-Pacific Partnership and the Paris Climate accord.  He decertified the Iran nuclear deal but stopped short of suspending the multilaterally negotiated agreement. Predicting the depth and steadfastness of US commitment to a global presence is therefore difficult.

Specifically with respect to the Asian theater, while Secretary of State Rex Tillerson and Admiral Harry B. Harris of the US Navy’s Pacific Command (PACOM) have underscored US interest in a strong presence in the Indo-Pacific region, President Trump, in a speech at a November 2017 gathering of Asia-Pacific CEOs in Danang, Vietnam that White House officials had billed as highlighting the US commitment to a “free and open Indo-Pacific region,” inveighed instead against the unfair trade practices of other countries and insisted that he would put America first and not let the United States be taken advantage of anymore.  Trump’s fiery defense of nationalism and sovereignty was followed immediately by President Xi’s vigorous defense of open trade and globalization.  Upon his return to Washington, however, President Trump in debriefing remarks on his trip to Asia touted his accomplishment of three goals: uniting the world against the North Korean menace; strengthening America’s alliances and economic partnerships in a free and open Indo-Pacific; and insisting on fair and reciprocal trade deals. His interlocutors in Asia, however, heard him emphasize the third objective.

Trump’s November trip to five Asian countries—Japan, South Korea, China, Vietnam, and the Philippines—thus did little to reassure US allies who are caught between the Scylla of economic reliance on China and the Charybdis of an uncertain protection from the US security umbrella. China dominates the economic scene in Asia.  To get a picture of what this means, consider the degree of dependence on China in Australasia.  China has superseded the United States as the largest trading partner of Australia, Japan, India, and the ASEAN countries.  International Monetary Fund (IMF) trade statistics for 2016 show that Australia and the countries of ASEAN collectively ran trade surpluses with China, making access to the large Chinese market enormously important, particularly to Australia and the smaller countries in Southeast Asia.  India and Japan ran trade deficits, although Japan’s deficit is small.  India is the exception here with a trade imbalance ratio of 1:5 in China’s favor fueling fear of Chinese goods flooding the Indian market.  Beijing is investing in much-needed infrastructure projects in countries from Asia and Europe to Africa.  Xi Jinping’s signature Belt/Road Initiative (BRI), which was unveiled to much pomp in May’s Belt and Road Forum in Beijing, has behind it the promise of $124 billion in funding.  China’s economic aid is attractive despite market rate loans because Beijing is unhampered by transparency issues as well as environmental and human rights concerns that are part and parcel of projects funded by the World Bank or the Asian Development Bank. In the long term, however, many of these investments saddle politically volatile countries with massive debt burdens making them vulnerable to strategic manipulation.

Recognizing that BRI is as much a geostrategic as an economic initiative, Australia, Japan, and India have been cautious about participation.  Australia has nominally agreed to set up a working group to discuss possible cooperation, but Prime Minister Malcolm Turnbull has so far refused to link BRI with the Northern Australian Infrastructure scheme.  Perhaps reacting to Trump’s protectionist instincts, Japanese Prime Minister Shinzo Abe in a June speech offered a paean to free trade and spoke favorably about BRI in the context of the economic virtues of linking the Pacific to Eurasia.  But, in an indirect message to the Chinese leadership, Abe noted the international community’s expectations that it was critical for any infrastructure projects to be “open to use by all” and “be developed through procurement that is fair and transparent.”  India’s concerns arise from the BRI’s lack of transparency and from New Delhi’s objection to the China Pakistan Economic Corridor (CPEC) project, which links the Chinese province of Xinjiang with Pakistan through contested territory in Kashmir.  Recognizing the importance of having India on board, the Chinese leadership has sought to placate New Delhi.

China’s rise is unlikely to be smooth unless Beijing can neutralize the worries of India, long-standing US allies in Australasia, and smaller countries in Southeast Asia.  Many of these countries are hedging their bets by engaging with China economically but also by investing in military hardware to shore up their security.  Australia, India, Japan, and South Korea regularly hold military exercises with their favored security partner—the United States.  India and Japan have cemented a strong partnership.  Australia has expressed interest in joining the annual Malabar naval exercises that bring together the United States, India, and Japan.  The first time that a quadrilateral naval exercise among these four democracies occurred was in 2007.  While New Delhi has not responded favorably to Australia’s recent request, either to avoid upsetting China or due to doubts over the extent of China’s influence in Australia, an overweening China is likely to propel security countermeasures in all these countries.

Beijing’s challenge is how best to balance its economic lure with what are seen by many of its Asian neighbors as provocative military moves in the East and South China Seas and the Indian Ocean Region. If China looms large in Asia militarily, the formation of an anti-China alliance may quickly follow.  The problem for great powers is that economic influence is seldom sufficient to override measures that countries are likely to take in the face of security threats.

Dr Vidya Nadkarni is a Professor and Head of Political Science at the University of San Diego, California. She is a Trustee of TPF.

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