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Monthly Archives: June 2014


Europe and China: A New Tack?

International Relations and Security Network, 26 June, 2014

At a recent state dinner in London for visiting People’s Republic of China (PRC) Premier Li Keqiang,David+Cameron+in+China+2+December+2013 British Deputy Prime Minister Nick Clegg made a number of undiplomatic comments, saying that the people of China were “politically shackled” to a communist one-party state guilty of human rights abuses. Unsurprisingly, given this government’s economic drive, Downing Street distanced itself from the statement, with Michael Fallon, the business minister, saying that human rights should not “get in the way” of trade links. Instead, UK Inc. reported that BP and Shell were due to announce multi-billion dollar deals with PRC oil companies. Indeed, investment from the entire visit by the PRC delegation was said to be worth more than 18 billion pounds.  That, it seemed, was that.

 Until recently, the policy approach of many Western nations towards the PRC has been based on a singular assumption. This assumption was that the West would do business with an authoritarian regime because it was thought that engagement would change the nature of that regime. In simple terms, trade would change the PRC from within, by building a middle class. The Clinton White House was the first to translate this assumption into policy – in 1994, Clinton delinked trade from advances in human rights and political reform, and, in addition to giving China most favored nation (MFN) status, signed a trade deal in 1999, which helped China accede to the World Trade Organization. The Americans were not alone. Japan, Taiwan, ROK and many EU states like Germany, the UK, and France encouraged trade ties with the seemingly reform-minded authoritarian regime. Many billions of dollars were injected into the country.

So far, business has been good…

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China and America: A Superpower Showdown in Asia?

The National Interest, 14 June, 2014

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Over the past several months, tensions between Washington and Beijing have steadily grown worse. Relying again on the incremental approach that has thus far served it well, China dragged a deep sea-drilling platform into Vietnamese-claimed waters, shouldering aside protesting Vietnamese vessels. Then on the 21st of May, President Xi Jinping proposed a new Asian security pact with nations such as Russia and Iran, a pact that pointedly excluded the US and seemed to be a club for authoritarian states. Then in June, Beijing refused arequest by a UN court of arbitration at The Hague to provide evidence of its claims in a case brought by the Philippines. Days later, a video released by Vietnam showed a heavy Chinese fishing vessel slowly crushing a Vietnamese counterpart; the moment seemed to perfectly symbolize China’s new diplomatic strategy towards the region and one could almost see the phrase “Chinese soft power” slipping under the waves with it. If one thought it couldn’t get worse, it did. As the West has continued to look for ways to exert pressure on Russia over its actions in Crimea, China finally revealed where its cards lay: Beijing inked a $400 billion natural gas deal with Moscow and now looks set to sign another. None of it good news for those who think China ought to be a status quo power, upholding the rules of the global system.

All of this must have been uppermost in President Obama’s mind in late May as he toured the region on what allies called a “reassurance tour” and Beijing called a “containment tour.” The tour failed to make any headway on the White House’s touted trade group, the Trans Pacific Partnership (TTP), but was overall a success by showing US allies and regional partners that the rebalance has the support of the White House. However, despite this brief show of US soft power diplomacy in the region, China’s rise has gradually shifted from being a welcome to an unwelcome event. One can almost see the exam question at some future university:

Were American leaders right to believe that economic liberalization and heavy investment in China would eventually lead to political liberalization, and make China into a responsible stakeholder?

Until recently, the preferred answer in Washington was yes.

It seemed certain to say that the economic liberalization of China was inherently a “good” thing, that raising millions out of poverty demonstrated once and for all the benefits of free market capitalism. The 1991 collapse of the USSR may have proven the failure of the communist economic model, but a successful China had demonstrated to the world capitalism’s strengths. And as every liberal knew, economic success brings with it a rising middle class, the vanguard of a pluralistic system.

Success, partly…

No one disputes that the first part of the story has been a triumphant success: China’s rampant growth as a state capitalist regime has dominated Western headlines for nearly two decades. An unprecedented influx of US, Japanese, Taiwanese and EU investment turned the Chinese economy red hot in less than a decade after Deng’s Southern Tour, with many becoming blasé about China’s double digit growth figures. Surely, Mao turned in his grave during the 2008 financial crisis, when many were calling China the savior of the global (capitalist) economy. Who could have predicted in his time that Chinese leaders would one day lecture their North Korean counterparts on the benefits of the free market? If anyone fretted that the second part of the story had not yet happened – China had not added political reforms to the mix – optimists would always add ‘yet’sotto voce. It was only a matter of time before China’s growing middle classes began clamoring for political as well as economic rights, they said, and saw signs of this in China’s growing online forums, which became miniature town meetings on corrupt officials and abuses of power.

And as Washington has watched with dismay, this Western notion that China would gradually liberalize politically has been dissipated more and more. Not only does President Xi show no signs of loosening Party control at home or of adopting liberal values abroad, his security proposal in Shanghai reveals an inclination to defend and augment authoritarianism. That brief spring felt before the 2008 Beijing Olympics quickly froze over as the regime reasserted control over television stations, bloggers and netizens, threatening three-year sentences to those who spread “internet rumors.” In early May, prominent journalist Gao Yu was detained as part of targeted campaign against activists in the run up tothe 25th anniversary of the Tiananmen Square incident, an anniversary that was eerily silent in Beijing. Contrary to expectations, Xi has also consolidated and centralized power with the party and the military quickly, with the Economistcalling him the most powerful Chinese leader since Deng.

Turning the Tide

Is a new Cold War between China and the United States inevitable? Obama’s foreign policy for the region has sought to avoid definitively answering that question, as well, he might. The consequences of radically changing direction when it comes to China policy would be a dramatic shift in US grand strategy, the greatest perhaps since the fall of Soviet Union. Many in the West have claimed that China cannot be “contained,” pointing to Beijing’s role in servicing US debt as well as its place as a major trade partner to so many pivotal US allies. While there is some truth to this, it is not quiet as unthinkable as it once was. Michael Pettis, a renowned economist at the Peking University, along with many others predict a debt crisis for China in the next 4-5 years, in which Chinese growth rates will all but come to a halt. He argues that the Third Plenum reforms promoted by President Xi (raising savings rates for homeowners, raising the currency, dealing with land ownership and the internal passport system) are bound to come into stiff resistance from Chinese elites, happily profiting from the current system. The stakes are quite high: should Xi fail to push these reforms through, China could hit the growth wall suffered by Japan in the late 1980s. As with Japan in the 1980s, China is called the engine for the global economy, but as Japan stagnated in the early 1990s, the West experienced one of the biggest booms in recent memory. This doesn’t mean that China is a paper tiger, it does cast doubt on the idea that China will is destined to inherit the earth…

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Obama’s Pivot to Asia: 2014 and Beyond

4 June, 2014

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Leaving on a Jet Plane

It was late at night as Air Force One taxied to a halt at Narita Airport in Tokyo to kick off an extended Presidential visit to the region. Emerging from the aircraft, President Obama seemed determined to impress upon the region and Japan his personal commitment to the Asia Pacific. Deemed a ‘reassurance tour’, the President’s trip to Japan, South Korea, Malaysia and the Philippines was meant to ‘underscore a continued focus on the Asia Pacific region and commitment to his vision of rebalancing to the world’s largest emerging region,’ in the somewhat wooden phrasing of the White House.

Despite the President’s many statements to the contrary, over the next few days, it was clear to many analysts and journalists that the trip was meant to reassure US allies over growing Chinese assertiveness. Chinese media like the Xinhua railed against the trip and the wider policy of ‘containment’. The US “rebalancing strategy”, the Xinhua wrote hours after Obama’s plane touched down at Narita, “smacks of a carefully calculated scheme to cage the rapidly developing Asian giant by rallying US allies”.  The Global Times quoted the Chinese Ambassador to Washington as saying the “rebalancing to Asia policy may need some ‘rebalancing’ so that the United States can maintain a good relationship to every nation in the region,” a not-so-subtle warning.

Missing the Point

Unfortunately, Chinese pundits missed the greater point in their haste to see rebalancing as simple containment and only a small number of analysts reported on the US rebalancing as a response to Chinese behavior. One such pundit, Yang Hengjun, a former diplomat and Senior Fellow at the Atlantic Council posed the question, ‘why are China’s neighbor’s so afraid of her’ in a regional forum, and though his efforts are laudable, he fails to connect Beijing’s problems with its policies, and instead blames the China’s media for hubristic statements that offend and scare neighbors. This neatly moves responsibility away from the military, CNOOC, and the Chinese leadership who have been promoting expansionism in the East and South China Sea maritime disputes. This attempt to forge a ‘CNN effect with Chinese characteristics’ rather reveals the constraints under which political analysts must be written in Beijing.

Japan and ROK

Despite the claims of the Global Times and others to the contrary, the trip was a success. And it was a success for one simple reason. It did what it said on the label. The president had gone to personify and symbolize US commitment to its allies in their various disputes with China and this was done. The United States’ reiterated its political and military support for the current status quo, and stated firmly that changes could only come peacefully and through diplomacy. Obama’s visit to Japan gave Prime Minister what he had long wanted, a presidential assurance that the Senkaku Islands (disputed with China) fell within the remit of the US-Japan security alliance. In return, Obama emphasized that Japan’s role as a regional force for stability would be enhanced by ‘collective self-defense’, a point that shows that the defence commitments of the alliance now cut both ways.

While some pundits have argued that Abe had done little more than take the President to a great sushi bar, giving little on the Trans Pacific Partnership (TPP) front, this overlooks the primary reason for the trip and overstates the need for the TPP to be negotiated within its present time-table. Others – such as Kent Calder, a noted scholar on Japan – have argued that behind the diplomatic niceties between Obama and Abe, the chasm between Washington and Tokyo has become incredibly wide, particularly on history and nationalism issues. Whatever the case, it is clear that Abe and Obama shared a single agenda for this trip: to consolidate the alliance in the face of regional insecurity, and avoid open bickering. This they managed to do, though it is a small victory.

Obama’s pressure on Abe to deal with the ‘comfort women’ issue was rewarded in Seoul as President Park Guen-Hye presented a warm welcome to the President. Days before his visit, the reputable Asan Institute published a survey saying that 93% of South Koreans saw the alliance with the US in a positive light. High strung North Korean media attempts to brand the visit as one by a ‘pimp’ to his ‘crafty prostitute’,[6] only seemed to reaffirm Pyongyang’s isolation and inability to be taken seriously. Despite or perhaps because of warnings from Obama and Park, the awaited 4th nuclear test failed to materialize in the days up to and after the summit. Truly, the visit was marred by the Sewol ferry disaster, which was then boiling over into a cabinet reshuffle; events around the Russian annexation of the Crimea also took precedence. As expected, the latter event caused ripples of disquiet among US allies, concerned about Washington’s military commitments. If anything, however, Russian behavior only served to reinforce the need for the US alliance system.

Malaysia: Symbolically Substantive

Arguably, Obama’s trip to Malaysia was the smoothest as the US rebalance was openly welcomed by Malaysia’s leadership. In a press conference hosted by Prime Minister Najib, the two men agreed to elevate the bilateral relationship to a Comprehensive Partnership, agreeing on the interdiction principles of the PSI, and continuing to work on increased military interoperability. As with Japan, Malaysia has begun to edge closer to the US as Beijing’s claims have hardened in the maritime sphere. On the other hand, as with Japan, this has yet to bring home the TPP bacon and the President was again disappointed on the TPP front. However, his mood must have been lifted during the ‘town hall meeting’ with a number of Malaysia’s young people as he was greeted with screams of “We love you, Obama”, a reminder of his potent charisma and links to the region. In an East West paper, Elina Noor at the Institute of Strategic and International Studies (ISIS) argues that this was where the real power of Obama’s visit to Malaysia lay – his ability to connect with people. For those who remember the criticism endured by the Bush administration in the region, his ability to connect has been a welcome one.

Last but not least

The final visit of the reassurance tour was to the Philippines, perhaps the place most in need of reassuring. Long-suffering at the hands of Chinese encroachment in the South China Sea, Manila was relieved that Obama’s statement that “…nations and peoples have the right to live in security and peace, to have their sovereignty and territorial integrity respected”, was supported by a new Enhanced Defense Cooperation Agreement. The new defence pact gave US forces greater access to patrol Philippine waters, and though US forces have eschewed basing rights, it is likely that both Japan and the United States will work to increase coast guard and naval Philippine capabilities.

The real question of course, is how did Obama’s reassurance trip affect China? What has the balance does to deter China from seeking to forcefully change the status quo? The answer to that is unfortunately ‘not much’, as can be seen by Beijing’s establishment of an oil rig in Vietnamese waters in the days following Obama’s return to Washington. There is very little self-awareness amongst the Chinese leadership and that in itself is most worrying. Relying on ‘the century of humiliation’ narrative, China’s media continues to defend expansionism from US ‘bullying’. If rebalancing to Asia does not deter China, what policy should replace rebalancing? “How do we deal toughly with our banker”, as Hilary Clinton once asked. What policies should the US adapt after a future Sino-Vietnamese naval conflict. The US and other regional states have oft told themselves that China cannot be contained, and that is probably true, but it can be restrained. It is really a question of making Beijing pay an economic and political price for its aggressive actions towards US allies. What comes after ‘rebalancing’? What indeed.

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