December 2013

Japan Center for International Exchange

The Future of East Asia:
Four Risks to Long-Term Stability
Hitoshi Tanaka, Senior Fellow, JCIE
Earlier this year, I wrote about the opportunitythat the ascent to power of a cadre of leaders aroundthe region—Shinzo Abe in Japan, Xi Jinping andLi Keqiang in China, and Park Geun-hye in South
Korea—presented for a reset of relations among East
Asian countries. To achieve a reset, countries in theregion need to overcome their confrontational postures. But the opportunity for a reset among the newleaders has been squandered. Rather than utilizing
their honeymoon periods to move regional relations
in a positive direction, confrontational postures havebecome even more deeply entrenched. This situation
presents a significant risk not just to the short-term
stability of East Asia, where miscalculations can leadto violent conflict, but also to the medium to longterm cooperative efforts that are needed to ensure thatthe evolution of regional order is locked into a peaceful and stable trajectory.
Now it is clear that the years leading up to 2020
will be key for shaping the future of the region. This iswhen Japan is set to host the Olympic Games in Tokyoand when China has set for itself the target of doublingits 2010 GDP and per capita income for both rural andurban residents. In particular, four main risks demand

our attention: the regional policies of the United Statesand China, the nexus that has developed in the region
between domestic politics and foreign policy, the rising tide of nationalism, and North Korea.

American and Chinese Regional Approaches
The regional policies of China and the United States(including US-Japan alliance coordination) will havelong-term ramifications dictating the way in which
competition is managed and cooperation is deepened
on shared interests.
For the last two decades, the strategy espoused by
Deng Xiaoping—for China to keep a low profile (taoguang yang hui) in international affairs—has beena key guiding principle of Chinese foreign policy.
However, around 2010, just before it overtook Japanas the world’s second largest economy, China appeared to disregard Deng’s dictate in favor of a more
confident, assertive approach. This was prominently
displayed at the ASEAN Regional Forum meeting in
Hanoi that year as China attempted to keep territorial disputes in the South China Sea off the agenda.
Ongoing tensions with Japan over the Senkaku
Islands, the banning of fish imports from Norway in2010 as retribution for awarding Chinese dissident
Liu Xiaobo the Nobel Peace Prize, the blocking of banana imports from the Philippines in 2012 as punishment over the Scarborough Shoal dispute, and mostrecently China’s abrupt declaration of an Air Defense
Identification Zone (ADIZ) in the East China Sea,
which overlaps with Japan’s own ADIZ and covers theSenkaku Islands, are also indicative of this trend.
The United States should respond appropriately
in order to deter aggressive and unilateral behavior,
but it should do this while engaging and not containing China. This is further complicated by the fact that
the United States must figure out how to rearrange
its military posture as it seeks to extract itself fromAfghanistan and Iraq and reduce its defense spending.
To this end, the United States has declared its “pivot”
to Asia—which it has since renamed a “rebalancing”
so as to avoid any perception of containment—andjoined the East Asia Summit.
From a Japanese perspective, however, there isconcern that a significant gap in US and Japanese
thinking may emerge regarding the best approach toChina. Recently the United States has been distracted
by domestic political gridlock. Additionally, US
National Security Advisor Susan Rice, in a November
20 speech at Georgetown University, referred to“operationaliz(ing)���������������������������������
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a new model of major power relations” with China, which has been misinterpreted inthe Japanese media as US accession to the G2 concept.
This has sparked concern that the United States mayagree to China’s own definitions of Chinese “core” interests and it may become too accommodating toward
China in the future. The recent statements by Secretaryof State John Kerry and Secretary of Defense Chuck
Hagel affirming that the Senkaku Islands are covered
under the US-Japan Security Treaty and voicing deep
concern regarding China’s announcement of an ADIZ
in the East China Sea, as well as the dispatch of B-52
bombers to the ADIZ, have made some progress toward assuaging Japanese concerns. But it is crucial thatwhen the United States expands its cooperation withChina, as it rightly must do, it conduct US-Japan alliance consultations ahead of time to prevent misunderstandings and ensure that new modes of cooperation
are compatible with alliance structures.
EAST ASIA INSIGHTSThe Domestic Politics–Foreign Policy Nexus
The trend of domestic politics undermining bilateral
cooperation and becoming increasingly irreconcilable with regional goals has become a risk to the medium and long-term stability of East Asia.
In the United States, the polarization of domestic
politics has manifested itself in US foreign policy in decidedly negative ways. The culture of filibustering andthe gridlock surrounding Obamacare, the debt ceiling debate, and budget deliberations, which prevented
President Obama from attending the APEC meetingsand East Asia Summit in Indonesia and Brunei inOctober, have undermined the credibility of US leadership in the region. Moreover, political deadlock seems
to be contributing to the decline in public support forPresident Obama.
Despite the reforms that were pledged at theCentral Committee’s Third Plenum in November,
China still faces an array of domestic political challenges including rapidly growing income inequality,
low living standards among the estimated 260 million rural migrant workers, widespread corruption,
food safety issues, air pollution, the de-leveragingof the financial sector, and the lack of structural reform to shift to sustainable growth. The failure toaddress these domestic political challenges has thepotential to seriously derail the legitimacy of theChinese Communist Party (CCP). Under this scenario there is an increased risk that Beijing could
be tempted to become adventurous in its foreign
policy in order to divert attention from its domestic
governance shortcomings, focus public frustrations
on an external enemy, and thereby achieve domestic cohesion.
In Japan, the economic situation appears to beimproving with the initial successes of Abenomics.
However, the risk now is that while the first two arrows(aggressive monetary policy and flexible fiscal spending) have hit the mark, the follow-through on thethird arrow of growth strategy, which needs to havethe greatest impact if Abenomics is to be successful inthe long term, has been underwhelming. While Prime
Minster Shinzo Abe has been relatively pragmatic until now, an economic setback could tempt him to pushconservative and nationalistic policies, which would2

December 2013

further worsen Japan’s already tense bilateral relations
with China and South Korea.
In South Korea, the constitutional court ruled thatthe denial of South Korean victims’ ability to pursue
compensation for damages suffered during Japanesecolonial rule was a violation of human rights andunconstitutional. Even though this court only has
domestic jurisdiction, the ruling is in conflict withthe overall thrust of South Korean foreign policy
and the 1965 Japan-ROK diplomatic normalizationagreement. Under that treaty, Japan and South Korea
settled all legal claims between the two countries andJapan provided South Korea with US$500 million ineconomic assistance. Thus this domestic action strikes
at the very underpinnings of the Japan-ROK bilateralrelationship and has raised tensions unnecessarily.

since its asset price bubble burst in the early 1990s,
economic growth plateaued and Japan failed to takedecisive action to revitalize its economy. Japan’s demographic challenges have also exacerbated the senseof frustration. As such, public opinion in Japan has
gradually become more questioning about Japan’spostwar pacifist posture, and the rise of China andthe threat posed by North Korea have become easytargets for the venting of frustrations. Recent polling shows that 90 percent of the Japanese public havenegative feelings toward China and vice versa.
Meanwhile, South Korea’s history as a countrycaught at a geopolitical crossroads between China,Russia, and Japan has fostered an exceptionally strong
sense of national identity. South Korea has gone on
to achieve remarkable economic growth, become an
OECD member, and undergo a stunning process ofdemocratization. But its continued focus on history
issues and the wrongs that Japan committed in thefirst half of the 20th century, in a manner that inhibits present-day cooperation, reflects a highly volatilenational consciousness. This trend has even gained
strength under President Park Geun-hye, who much
to Japan’s dismay and against normal diplomatic protocol, has criticized Japan in third countries, rather
than bring her complaints directly to Japan in a bilateral summit.
The narrative that is increasingly shaping Northeast
Asian countries’ national identities is problematicgiven the highly insular mentality it feeds and theantagonistic postures it encourages. Greater efforts
are needed to promote national narratives within thebroader framework of regional cooperation and give
focus to the shared peace and prosperity and intertwined destiny of the region.

The Rise of Nationalism
Also, nationalism has been on the rise around
Northeast Asia, and its growing spillover into policymaking in the region is compounding the challenge ofreconciling the domestic politics–foreign policy nexus.
China’s national narrative, as seen through a CCPlens, emphasizes the role of the Communist Partyin overcoming suffering at the hands of Japan’s military during the Pacific War. As such, China’s periodof national humiliation and anti-Japanese sentiment
lingers at the forefront of the Chinese national consciousness. Now that China has risen to become thesecond biggest economy—and the second-largest defense spender—in the world, it is starting to regain its
national confidence. As part of the internal debate inChina, questions are now being raised about the longterm relevance of Deng’s low-key approach, and pockets of conservative nationalists on one side appear to
be in favor of jettisoning the principle once China isfirmly situated as a major power. Given this situation,
greater efforts are needed to guard against unilateralchanges to the status quo and to bring China into thefold as a responsible regional stakeholder and as apartner of the United States and Japan.
The optimism surrounding the amazing speedwith which Japan rose from the ashes of defeat ofWorld War Two, and rebuilt itself as an economic
powerhouse, has turned to frustration. In the decades
EAST ASIA INSIGHTS

North Korea
The situation in North Korea, in terms of both its domestic politics and external relations, also presents
a significant risk to the future of East Asian regional
stability. Since Kim Jong-un took over power fromhis father two years ago, Korea watchers have intently looked for signs to gauge the extent to which
Kim Jong-un has consolidated power. The canny efforts of Kim Jong-il and Kim Il-sung in creating an3

December 2013

intentionally opaque political system that stamps
out expressions of criticism against the regime andprevents them from ever becoming public makethe situation tremendously difficult to judge fromthe outside. However, while Kim Jong-un has been
dubbed Supreme Leader, he does not appear towield power in as outright a manner as his father orgrandfather. Moreover, recent South Korean intelligence reports of Jang Song-thaek—Kim Jong-un’s
uncle and the vice-chairman of the National Defence
Commission—being dismissed from his posts, aswell as reports of numerous purges of high-ranking
Korean People’s Army personnel, suggest that Kim
Jong-un’s transition may not have been as smoothas surface-level indicators would have us believe. Sowhile a grassroots movement against the governmentis still extremely unlikely, the need for Kim Jong-unto keep the military on his side and the risk of a backlash from disgruntled purged former generals andtheir supporters remains.
It is clear that North Korea wants dialogue with theUnited States, but the two sides disagree on preconditions to be satisfied before any meeting can take place.
This is a result of the United States, Japan, and South
Korea feeling cheated in past denuclearization negotiations. Thus they want North Korea to demonstratethat it is serious this time around, and they also desire
assurances from China that it will give its full backing
and cooperation to any deal. China’s unique position
as North Korea’s only de facto backer means Chinese
support is crucial to ensure any future potential agreement is implementable in reality. Additionally, thesituation in the Middle East—and getting a nuclear
deal with Iran right—is critical to the North Koreansituation. A successful Iran deal will show North
Korea, which is wary of how Libya was steamrolled
after giving up its nuclear program, that a denuclearization deal can lead to a win-win situation for allparties. At the same time, focusing excessively on theMiddle East and neglecting North Korea would be amistake. As unpalatable as negotiations with North
Korea may seem, strategic patience is not a realistic
alternative as it just gives North Korea more time torefine its nuclear development. Moreover, in the absence of negotiations, North Korea is likely to begin
the cycle of military provocations again, including
through further missile or nuclear tests or via stealthattacks utilizing its asymmetrical advantage along thecontested Northern Limit Line that demarcates thetwo countries’ western maritime border.
◆ ◆ ◆We have already missed one golden opportunity, but
if the confrontational postures that have emerged in
the region become entrenched, there is the risk thatthe future regional order may be derailed. Over thecoming years leading up to 2020, there is a need forincreased efforts to convince the respective publics
in East Asian countries of the importance of regional
cooperation and for intensive discussion between
leaders for the mutual promotion of brave leadershipthat does not succumb to the temptation of shortterm domestic political gains at the expense of longterm regional cooperation. Policymakers must be
more conscious of the medium to long-term evolution of regional order and focus regional cooperationin order to overcome nationalism, de-fang domestic
political dynamics that undermine bilateral cooperation, and pursue domestic objectives that are compatible with regional cooperation and the goal of sharedpeace, prosperity, and stability in East Asia.
Hitoshi Tanaka is a senior fellow at JCIE and chairmanof the Institute for International Strategy at the Japan
Research Institute, Ltd. He p­ reviously served as Japan’s
deputy minister for f­oreign affairs.

East Asia Insights
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December 2013