Prepared for the IIPS Symposium onJapan’s Role in the Forthcoming World Order
Tuesday, 1 November 2005
TokyoSession 2

Prospects for Cooperation in East Asia
Xu Zhixian
Doctor Candidate Adviser
China Institute of Contemporary International Relations

Prospects for Cooperation in East Asia
Xu Zhixian
China Institute of Contemporary International Relations
Cooperation in East Asia currently offers a vision of unbounded vigor. That is, East
Asian regional cooperation appears to be well on track, in terms of its scope, substance,and organizational structures. Looking to the future, therefore, it can be anticipated that
regional cooperation in East Asia will unite the efforts of the 13 nations concerned, notonly yielding economic integration in East Asia but also advancing political, security,and social cooperation in the region, bringing an “East Asian community” closer toreality, and stimulating growth.
The mechanisms for East Asian collaboration are constantly evolving
The construction of collaboration mechanisms in the East Asian region essentiallyseems to have passed through three distinct stages. The period 1997 to 1999 could be
regarded as the initial stage. When the 1997 Asian financial crisis occurred, 13 East
Asian nations (the ten ASEAN nations plus China, Japan, and South Korea) graduallycame together to form the so-called 10+3 regional cooperation mechanism, and this canbe seen as the precursor for the development of a path towards the creation of formalinstitutions. This was how the three principal nations of the Northeast Asianregion—China, Japan, and South Korea—first came to be incorporated into a single
cooperative framework.
Initially, however, the so-called 10+3 framework was merely an unstructured
mechanism for functional cooperation that did no more than provide an opportunity forthe leaders of the nations concerned to engage in informal talks.
The time from 1999 to 2004 could be described as the period during which East
Asian collaboration mechanisms were established as institutions. At the third 10+3
summit conference, which was held in November 1999, consensus was reached on thefundamental principles of East Asian regional cooperation, the course that would befollowed, and the key areas for cooperation. The adoption at this conference of the Joint
Communiqué on Cooperation in East Asia could be viewed as a pivotal moment in the10+3 process. The conference accepted South Korean president Kim Dae-jung’s
proposal that an East Asian Cooperation Survey Group be established, and set out aplan for the East Asian cooperation process and its objectives. Subsequently, themechanism for implementation of the 10+3 cooperative framework has gradually
crystallized, and consists of the following three tiers. At the top level are summit
conferences (which have since been upgraded from informal to formal). At theintermediate level are 10+3 conferences and 10+1 conferences (bilateral meetings
between the ASEAN nations and either China, Japan, or South Korea), as well as
trilateral summit conferences between China, Japan, and South Korea. Thereafter,
meetings are also held at the ministerial level (so far these have involved financeministers, foreign ministers, ministers for economics and fiscal policy, and senior
vice-ministers from finance ministries and central banks). In addition, meetings
between divisional chiefs are also held.
The 10+3 Laos summit conference, which was held at the end of 2004, took thedecision to stage an East Asian summit. This transformed the East Asian collaborationregime from the 10+3 summit to an East Asian summit conference and elevated themulti-faceted top-level cooperation mechanism in East Asia to a higher plane. As
regional cooperation has become stronger, discussion has switched to the establishment1

of a scalable high-efficiency permanent organization, to which authority could
increasingly be delegated, so that the principal multi-faceted cooperation mechanism
could be made continuously available. The East Asian summit will remedy thedeficiencies of the existing 10+3 mechanism, accentuate the roles of China, Japan, andSouth Korea, and provide a springboard for a more equable integration process for East
Asia. Due to the mutual lack of trust between China and Japan, the two nations are notable to take a joint lead in the regional cooperation process. However, since bothnations are apprehensive about the other assuming leadership, there is a tacit agreement
between them that they will use ASEAN’s existing mechanisms to advance the cause ofregionalization. As a result, the smaller nations will have to demonstrate the necessary
leadership, and the adverse consequences that would have arisen from a dispute
between Japan and China over the right to lead will be avoided. This would seem to benecessary in the initial stages of the integration process. As the cases of Western
Europe and North America have demonstrated, in the future, East Asian integration will
demand more participation by key nations, such as China and Japan. Also, as theMalaysian foreign minister has remarked, “The East Asian summit should provide aplatform for the ASEAN+3 nations to engage in constructive dialog with countries
from outside the region as well.”East Asian cooperation aims for a more ambitious target
As cooperation in the East Asian region intensifies, a new division of labor between theeconomies of East Asia is taking shape, the volume of trade is increasing, and, withgrowing consensus among East Asian nations over major political and security issues,
there is now a more ambitious target for the integration process—an East Asiancommunity. What are the implications of such an East Asian community and how
should it be viewed? In the opinion of this author, the nations of East Asia ought to startby constructing mechanisms for cooperation on all fronts. As well as emphasizing thestrengthening of regional economic unity and the establishment of an East Asian
free-trade zone, these cooperation mechanisms should strengthen cooperation in areas
such as the social, political, and security spheres, allowing the nations concerned tocollaborate in the political sphere, complement one another in the economic sphere, anddevelop mutual trust in the security sphere. That is, the nations concerned should firstestablish an East Asian free-trade zone and bring about closer cooperation in areas suchas energy conservation, environmental protection, and high technology. Establishing afree-trade zone for the entire East Asian region would entail not only the liberalizationof trade in goods, services, and information, but also increasingly strong andwide-ranging economic cooperation, for example on credit and currency issues. Oncean East Asian free-trade zone has been established, therefore, it will doubtless serve asa stable platform for an East Asian community. Next, an effective security mechanism
will have to be established within the region. The standing of any East Asiancommunity in political and security terms will likely be dependent on the establishmentof an effective security accord at the outset. The main role of this mechanism would beto find ways to resolve problems in trouble spots within the East Asian region so as toprevent political and security disputes between states in the region from escalating to
the level of crises and clashes. Taking the long view, the nations of East Asia shouldmake use of this security accord to formulate standards for joint action in the area ofsecurity, and will eventually have to transform the security accord mechanism into agenuine security mechanism. Moreover, as the nations of East Asia engage in theprocess of building a community, ceding of some national and state sovereignty must
be viewed as inevitable; however, this will chiefly consist of compromises in relation to2

economic sovereignty and is certain to be limited in scope. The principal long-term
tasks associated with East Asian integration are as follows: to establish a large single
market for the region, thereby enabling the free flow of capital, technology, andmanpower within the region; to demonstrate a significant degree of progress incooperation on credit and currency issues; and eventually to present to the world asingle Asian currency and ensure that it becomes one of the world’s major currencies,
alongside the dollar and the euro. In the political and security spheres, East Asian
integration should also aim to maintain stability in the East Asian region and long-term
peaceful co-existence between nations.
Bright prospects for East Asian cooperation
There now seems to be a genuine opportunity for East Asian cooperation. First, theinternational order in East Asia is enjoying the benefits of peace. The role oforganizations for East Asian regional cooperation has gained prominence and they havebecome the driving force behind regional integration (or quasi-integration) for East
Asia, underscored by cultural ties and notions of geopolitical benefit, economic
cohesion, and collective security. The Cold War greatly affected East Asia, and theregion found itself freed from its constraints when it ended. Borne along on the risingtide of globalization, it has since displayed enormous energy and has with great vigor
pursued regionalism and the development of regional cooperation. Second, the first 20years of the twenty-first century represent a strategic opportunity to establish an East
Asian community. Over the course of this time-span, East Asian economic power looks
set to become increasingly effective, politically the region is likely to attain a positionof comparative autonomy, and the East Asian economy appears likely to enter a periodof fairly rapid growth. According to estimates by a London-based firm specializing ineconomic forecasting, the East Asian economy will achieve an average annual growthrate of 5.9% between 2004 and 2008, and the economic outlook over this period for
China and Japan (whose economies comprise the greater part of the East Asianeconomy) is favorable. According to statistics, the gross domestic product (GDP) of
East Asia in 1990 accounted for 19.3% of the total world-wide GDP; forecasts projectthat in 2025 it will reach 50 trillion dollars and comprise 25.5% of the world total(compared to 18.5% for the GDP of the USA and 19.4% for the GDP of WesternEurope). As the overall economy comprising the states within the East Asian region hasgrown larger, trade within the region has expanded and increased in volume—mostnotably, the volume of trade between Japan and China has risen continuously. This
expansion of trade has provided the initiative and the impetus for the nations of East
Asia to establish a free-trade zone. Third, the protracted campaign to counter terrorism
has reduced opposition to the establishment of an East Asian community, China has
avoided being tagged by the USA as its principal rival, and furthermore, China has
joined the ranks of the nations cooperating effectively on matters such as the Korean
nuclear issue. In the future as well, the USA is highly likely to need long-termcooperation from China in areas such as counter-terrorism and nuclear
non-proliferation. Since Southeast Asia has the largest Muslim population in the world,
the region’s ability to take effective measures against terrorism has a direct bearing on
the prevention of terrorism world-wide and also affects the US national interest.
Accordingly, US policy is to play down the adverse effects of the establishment of an
East Asian community, in order to ensure the long-term survival of the components
essential for preventing terrorism, and there is thus unlikely to be strong opposition tointegration from outside the region. Fourth, the trend towards the formation of regional
blocs appears to be gathering pace in the context of economic globalization. Around the3world today, continental America boasts the North American Free-Trade Zone andthe Pan-American Free-Trade Zone, Europe has the European Union, and in Africa
there is the African Union. It seems that—despite being the sole superpower—even theUS does not feel strong enough to cope with economic globalization single-handedlyand must seek support in regional blocs. It is thus no accident that the nations of East
Asia have reached consensus regarding an East Asian community, and it is a necessary
step in the increasing shift towards regional blocs. The expansion of this shift towards
regional blocs is a logical consequence of Asian thought and behavior, and can only beregarded as historically inevitable. Fifth, the consistent expansion of East Asiancooperation has continued to strengthen the roles of the 10+1 and 10+3 mechanisms.
During the latter half of the 1990s, the 10+1 grouping consisting of ASEAN and China
announced that it would establish a free-trade zone in 2010. At last year’s 10+3 summit,
China, Japan, and South Korea issued a joint communiqué declaring that they would
strengthen economic cooperation, in part through the establishment of a free-trade zone.
The emphasis that the three nations placed on East Asian cooperation proves that actual
cooperation is growing stronger too.
“Twin-engine” role of China and Japan contributes to East Asian cooperation
The existence of cooperation between China and Japan is the key to East Asian
integration. Both theory and practice dictate that the evolution and development ofregional integration must be driven by a single standard, and that this standard must
create a centripetal force both to provide motive power and set direction. Currently, thebest option would appear to be for ASEAN to take the lead in coordinating activities
and carrying out organizational work. Objectively, it is imperative that the leadership
position be entrusted to ASEAN, and this is also dictated by East Asian internationalrelations. In the end, however, the success of East Asian integration is dependent on
amicable and cooperative relations between China and Japan, without which genuine
East Asian integration does not seem possible. Likewise, from the perspectives ofgeopolitics and international relations within the region, amity and cooperation between
China and Japan are desirable and are essential to the establishment of a standard for
economic regionalization in East Asia and East Asian integration. Essentially it could
be said that this is the key to stability and success for the East Asian integration process.
The crux of the East Asian economy is Northeast Asia, not Southeast Asia. The
combined GDPs of China, Japan, and South Korea account for 91.2% of the total GDPfor the 13-nation East Asian economy, with China and Japan alone accounting for84.5% of the total East Asian GDP. Clearly, China and Japan are pivotal to East Asian
cooperation. Unfortunately, however, a series of existing problems between the twonations has seen them lapse into mutual distrust, which has in turn affected theprocesses for cooperation in Northeast Asia and East Asia. As the two great regional
powers (accounting for 84.5% of the total GDP and 70% of the total population of East
Asia), China and Japan clearly exert a tremendous influence on the direction in which
East Asia is headed. At present, China would appear to be faced with the following
issues. The first issue is the health of Sino-Japanese relations and the problem ofwhether steady progress can be achieved in this regard. China and Japan have alreadyreached a series of agreements—notably they have established a clear set of groundrules between them in the Japan-China Joint Communiqué, the Treaty of Peace andFriendship between Japan and China, and the Japan-China Joint Declaration. These
three documents, which represent the hard-won fruits of the labors of the elder
statesmen of China and Japan, must be adhered to, and the two nations must at all costs
practice what they have preached. In matters where the practical interests of one or4other nation is at stake, the two nations must as next-door neighbors demonstratemutual respect, compromise with one another, maintain consultations through dialog,
and calmly resolve the problems at hand. It is of the utmost importance that this type ofissue not be allowed to affect the overall picture. The second issue is mutual
cooperation and whether China and Japan can avoid ostracizing one another. It issometimes argued that China and Japan are vying with one another for the right to takethe lead in the East Asian cooperation process, and that if China gains the ascendancy,
Japan will decline, or if Japan becomes stronger, it will be dangerous for China.
However, this interpretation does not seem to fit the historical record and appears to be
divorced from current reality. China and Japan have never vied with one another for the“trophy” of Southeast Asia, and the two nations are not natural enemies, incapable ofco-existence. Seeking an environment of long-term peace that is conducive to economic
development, China has maintained a policy of friendship and good neighborlinesstowards the nations of Southeast Asia, and harbors not the slightest ambition forhegemony. Even now, Japan’s defense and foreign policy is controlled by the USA, andit seems highly improbable that these two would form a bloc and claim hegemony overSouth East Asia. The USA would probably not be able to remain on the sidelines if
either China or Japan were to subsume Southeast Asia into its economic or politicalsphere of influence. In the future Asia will never belong to either China or Japan—it
can only be a shared Asia, of which both China and Japan will be constituent parts. The
third issue relates to the regional cooperation strategies that China and Japan will adopt.
China and Japan must fulfill the role of “twin engines.” Economically Japan certainly
enjoyed the position of top dog in East Asia during the heyday of its prosperity;
however, at the time some Chinese were unsure as to whether they ought to participate
actively in East Asian economic cooperation. Now the boot is on the other foot, andwith the Chinese economy growing rapidly, Japan is likewise fearful of China assuming
the leadership role. Both countries incline to the view that it would be detrimental if theother side were to lead. It has become hard for Japan—once the lone point-man for East
Asia—to stay out front amidst the turmoil of economic globalization, regionaleconomic integration, and rapidly growing new economies. Likewise, although China
has achieved comparatively high economic growth, ironically its per capita GDP is still
no higher than a middling developing nation, and it has neither the capability nor thewill to assume the leadership role. Thus, China and Japan must be East Asia’s “twinengines.” If the two nations can play to their respective strengths and maximize theircontributions to the East Asian region, this should greatly expedite the progress of East
Asian regional cooperation. By actively participating in regional cooperation, China
can make its stance abundantly clear. China’s foreign policy is placing ever greater
emphasis on balancing the pursuit of its own interests with the preservation of common
regional and global interests, and China is making great efforts to harmonize its growthwith global trends and the course of world progress. Discussion of Asia naturally
focuses on the link between the advancement of Asia and the growth of China.
Advancing regional cooperation represents the logical conclusion and extension ofChina’s local policy of being good to its neighbors and being a friend to its neighbors.
On the basis of its existing foreign policy of neighborly friendship, China has gone astep further and set out new policy objectives under the slogan “good neighbors, secureneighbors, and prosperous neighbors.” The goal of this policy is to establish anenvironment of peaceful stability, friendly co-existence, and shared growth in thesurrounding area. It is our intention to strive for the realization of these objectives, notonly through bilateral foreign policy, but also through regional cooperation.

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