Banning Garrett and Jonathan Adams

U.S.-China Cooperation on 

the Problem of Failing States 

and Transnational Threats

Summary

• American and Chinese perspectives on the threats and challenges emanating from 

failing states have been converging, especially since the September 11, 2001, terrorist attack on the United States.

• Despite differences over terminology (“failing states” vs. “areas of instability”), 

Americans and Chinese agree that failing states are often those least connected to 

globalization; extending globalization to these states and deepening its impact is 

therefore necessary to help move failing states into the “succeeding” category. 

• In addition to developing measures aimed at thwarting near-term dangers, both sides 

believe that long-term preventive measures are necessary to address the conditions 

of poverty, poor governance, chronic violence, criminal networks, weak infrastructure, 

and religious or ethnic extremism in these regions that give rise to new security 

threats. 

• Such measures include promotion of good governance, which is often best achieved 

by establishing democratic, accountable governments and free market economies. 

• The convergence of Chinese and American views on failing states coincides with an 

overall improvement in bilateral relations and growing cooperation on a number of 

other common strategic interests, including counterterrorism, nonproliferation, and 

other transnational threats emanating from weak states. 

• The willingness of China to cooperate with other nations regarding counterterrorism and other threats posed by failing states reflects China’s perceived need to take 

greater responsibility for maintaining international peace and stability and Beijing’s 

desire to convince the world that a “rising China” will be peaceful and supportive of 

the international system. 

• This new outlook, combined with lessons learned from China’s own development 

experience, presents opportunities for enhanced bilateral Sino-U.S. cooperation that 

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SPECIAL REPORT 126 SEPTEMBER 2004

ABOUT THE REPORT

Increasingly, U.S. officials and foreign policy

analysts have been focusing on the challenges and 

security threats emanating from weak, failing, and 

failed states, especially since the September 11, 

2001, terrorist attacks on the United States. They 

have paid less attention, however, to the views 

and concerns of other major nations that are also 

threatened directly or indirectly by these areas of 

instability and whose cooperation will be essential to 

reduce the dangers in regions far from U.S. borders. 

China is one of these nations. 

 To explore the similarities and differences 

in opinions between Chinese and Americans regarding 

the array of transnational threats and challenges 

posed by failing states—and the prospects for U.S.-

China cooperation in addressing these threats and 

challenges—the Atlantic Council of the United States, 

the United States Institute of Peace, and the China 

Institutes of Contemporary International Relations 

cosponsored a meeting in Beijing on February 23–24, 

2004. The conference participants included former 

senior American policymakers and U.S. security 

experts, as well as Chinese analysts and policy advisers 

from civilian and military think tanks in Beijing. 

This report is based on conference 

proceedings and papers, and it was written by 

Banning Garrett, director of Asia Programs at the 

Atlantic Council, and Jonathan Adams, the Asia 

Programs’ assistant director. 

The views expressed in this report do not necessarily 

reflect views of the United States Institute of Peace, 

which does not advocate specific policy positions.

UNITED STATES INSTITUTE OF PEACE

SPECIAL REPORT

CONTENTS

Introduction 2

Perspectives on the Problem 3

Prescriptions for Action 5

Challenges to Bilateral and Multilateral Cooperation 7

 Agenda for Government-Government Cooperation 8

Agenda for Track-Two Dialogue 9

Conclusion 10
should be explored in the interest of both countries. In addition, the United States 

and China should work together in multilateral institutions to improve these organizations’ responsiveness to the challenges posed by failing states. 

• There are some serious potential obstacles to greater U.S.-China cooperation, including strategic mistrust, the volatile Taiwan issue, differences over trade and human 

rights, and domestic politics in both countries. 

Introduction

The threats and challenges emanating from weak, failing, and failed states are likely to 

worsen in coming years and decades, placing ever-increasing demands on a resourceconstrained world, especially the United States, whose unmatched level of involvement 

in the global economy gives it a keen interest in maintaining international stability. 

Coping with these demands—via counterterrorism activities, peacekeeping operations 

(PKO), campaigns to prevent the spread of deadly diseases, and nation building—will 

require greater international cooperation. The United States will need not only to consolidate and strengthen its current bilateral and multilateral agreements on these issues 

with its longtime allies but also to seize opportunities to establish and expand new 

partnerships, especially the one it has developed with China since the September 11, 

2001, attack on the United States by the global al Qaeda terrorist network.

The 9/11 attack made Americans more aware of global threats and reset the U.S. 

government’s national security priorities. This unprecedented terrorist attack on the U.S. 

homeland focused the nation’s attention on weak, failing, and failed states—those that 

not only represent potential humanitarian crises or security problems for U.S. friends in 

the affected regions but also pose direct security threats to the territory and population 

of the United States and other major countries as well, as demonstrated by al Qaeda’s 

planning the attack on the United States from bases in Afghanistan.

Often overlooked in the domestic U.S. debate over national security strategy post9/11 have been the profound effects of the terrorist attacks on the strategic perspectives 

of other major nations, particularly China. In the wake of the attacks on New York and 

Washington, Chinese leaders have concluded that al Qaeda terrorist attacks, were they 

to succeed in crippling the American economy, could also jeopardize China’s economic 

development and its political and social stability. 

The 9/11 attack has made Beijing more aware of potential direct threats to China’s 

security. Bordered by a number of states that have provided safe haven to terrorists, 

including Afghanistan, Pakistan, and some Central Asian states, China has also begun 

to recognize the urgency of responding to the dangers and challenges emanating from 

weak and failing states, including emerging or worsening transnational, nontraditional 

threats. (The Chinese prefer using the term “areas of instability” rather than the terms 

“failed state” and “failing states,” partly because of their long-cherished principle of 

“noninterference,” but primarily because the latter terms, if used by Chinese officials 

or government-supported research institutions, would likely alienate the particular 

governments involved. Use of the term “failing state” in official public documents has 

also been a political issue for the U.S. government. Nevertheless, the terms “failing 

states” and “failed states” were used here for convenience and out of recognition that 

these terms are commonly used in international discourse.) These threats include not 

only global terrorism and the proliferation of weapons of mass destruction (WMD) to 

unstable or hostile regimes and nonstate actors, but also piracy, international crime and 

smuggling networks, the incubation and spread of deadly diseases, regional conflicts, 

and humanitarian crises. 

The Chinese also recognize that the sea-lanes that are vital to their rapidly growing 

economy are vulnerable to terrorism, piracy, and other forms of disruption by nonstate 

ABOUT THE INSTITUTE

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independent, nonpartisan federal institution 

created by Congress to promote the prevention, 

management, and peaceful resolution of international conflicts. Established in 1984, the Institute 

meets its congressional mandate through an array 

of programs, including research grants, fellowships, professional training, education programs 

from high school through graduate school, 

conferences and workshops, library services, and 

publications. The Institute’s Board of Directors is 

appointed by the President of the United States 

and confirmed by the Senate.

BOARD OF DIRECTORS

• J. Robinson West (Chairman), Chairman, PFC Energy, 

Washington, D.C. • María Otero (Vice Chairman), President, 

ACCION International, Boston, Mass. • Betty F. Bumpers, 

Founder and former President, Peace Links, Washington, 

D.C. • Holly J. Burkhalter, Advocacy Director, Physicians 

for Human Rights, Washington, D.C. • Chester A. Crocker,

James R. Schlesinger Professor of Strategic Studies, School 

of Foreign Service, Georgetown University • Laurie S. 

Fulton, Williams and Connolly, Washington, D.C. • Charles 

Horner, Senior Fellow, Hudson Institute, Washington, 

D.C. • Stephen D. Krasner, Graham H. Stuart Professor 

of International Relations, Stanford University • Seymour 

Martin Lipset, Hazel Professor of Public Policy, George 

Mason University • Mora L. McLean, Esq., President, 

Africa-America Institute, New York, N.Y. • Daniel Pipes, 

Director, Middle East Forum, Philadelphia, Pa. 

• Barbara W. Snelling, former State Senator and former 

Lieutenant Governor, Shelburne, Vt. 

.

MEMBERS EX OFFICIO

• Lorne W. Craner, Assistant Secretary of State 

for Democracy, Human Rights, and Labor 

• Michael M. Dunn, Lieutenant General, 

U.S. Air Force; President, National Defense University 

• Peter W. Rodman, Assistant Secretary of Defense for 

International Security Affairs • Richard H. Solomon,

President, United States Institute of Peace (nonvoting)

2
actors. Cross-border support for insurgencies in western China is also of concern. In 

addition, given the dramatic increase in the number of Chinese nationals traveling for 

business, study, or tourism, China now faces the challenge of ensuring the safety and 

security of its own people as they venture into countries in which they may be in danger 

from terrorist attacks, civil conflict, and regional war. This vulnerability was recently 

demonstrated by the seizure of seven Chinese as hostages in Iraq on April 11, 2004, 

and the explosion of a terrorist bomb in Pakistan that killed three Chinese construction 

workers in May 2004. 

The Chinese government is becoming more assertive in its approach to protecting 

its interests in these areas, including accepting rationales for international military 

intervention in some cases (such as in Afghanistan), thus coming more into alignment 

with U.S. perspectives on these issues. This shift in the Chinese perspective on terrorism reflects, more generally, a significant change in Chinese strategic thinking and 

foreign policy. While still insisting on the primacy of the United Nations, the Chinese 

government, under the new leadership of President Hu Jintao and Premier Wen Jiabao, 

has downplayed its prior insistence on “noninterference” and adopted a more flexible, 

open, and proactive foreign policy. This new activism has been especially apparent in 

establishing the forum for the Six-Party Talks on North Korea’s nuclear weapons, which 

have been held in Beijing. 

If sustained, such foreign policy thinking and practice could signal a new international role for China, one of greater responsibility for maintaining a peaceful and stable 

international environment. China’s efforts to take a more active role in maintaining 

international and regional security dovetail with other actions the nation has taken to 

convince the world that the rise of China will be peaceful and supportive of the international system rather than aggressive, disruptive, and ultimately catastrophic, like the 

rise of Germany and Japan in the period leading up to World War II. 

This confluence of events and change in strategic orientation could create new opportunities for the United States and China to work together, not only to combat global terrorism but also to address a wide range of other threats and challenges emanating from failing 

states. To advance such cooperation, however, both sides need to better understand each 

other’s perspectives on these issues and on preventive measures to avert state failures and 

remedial measures and reconstruction strategies to deal with states such as Afghanistan 

once they have failed or collapsed. 

Perspectives on the Problem

The problem of failing states and transnational threats must be viewed within the broader 

context of globalization and the post–Cold War, post-9/11 strategic environment, which 

poses common challenges and threats to China, the United States, and other major 

global players. In this new global environment, the strategic interests of the United 

States and China seem to be converging, with both countries recognizing the need for 

bilateral and multilateral cooperation to address these new security issues. 

China’s strategic interests and its policies regarding failing states and transnational 

threats have changed dramatically in recent years, from support for “anti-imperialist” 

movements in the Third World thirty years ago to a vested interest today in international 

cooperation to meet the challenges posed by terrorism, proliferation, ethnic conflict, 

religious extremism, and other nontraditional security threats (see box A, on page 11, 

which contains excerpts from aForeign Ministry statement outlining China’s official position on nontraditional security threats). The Chinese have also increasingly been participating in peacekeeping operations (see box B, on page 12, which enumerates China’s 

PKO commitments) and have been providing assistance to weak, failing, and failed 

states (see boxes C1 and C2, on pages 13–14, which summarize some of China’s foreign 

assistance activities). China has also changed its own behavior regarding the spread of 

3

This shift in the Chinese perspective on terrorism reflects, 

more generally, a significant 

change in Chinese strategic 

thinking and foreign policy.

This confluence of events and 

change in strategic orientation 

could create new opportunities 

for the United States and China 

to work together.

China’s strategic interests and 

its policies regarding failing 

states and transnational threats 

have changed dramatically in 

recent years.
weapons of mass destruction, shifting from supporting proliferation three decades ago to 

increasing efforts to halt it. The Chinese have instituted domestic measures to prevent 

the export of prohibited items, including the implementation of export controls. They 

have also joined most nonproliferation regimes and initiated diplomatic efforts to halt 

proliferation elsewhere, as exemplified by the Six-Party Talks on North Korea’s nuclear 

weapons program. (Box D, on page 15, offers a snapshot of the evolution of China’s 

proliferation policy.)

Strategies for dealing with failing states must contain long-term measures designed 

to address the causes of state failure and transnational threats as well as actions 

designed to reduce the near-term dangers they pose. Root causes may include the 

interrelated phenomena of economic decline, lack of physical security, poor governance 

(including weak institutions and high levels of corruption), crumbling or nonexistent 

systems of communication and transportation, inadequate health and educational facilities, high levels of official debt, the presence of criminal networks, insufficient financial 

and governmental resources, and the potential for large-scale human slaughter. Chinese 

and American analysts agree on two seemingly contradictory points regarding how 

to respond to these threats and challenges: one, identifying the right remedy for the 

symptoms of failing states can be difficult unless the underlying problem is properly 

diagnosed; and two, in practice, near-term actions will be necessary to thwart emerging and immediate threats, whether or not the ultimate cause of the problem has been 

determined and addressed. 

Although U.S. and Chinese perspectives on sequencing may differ, both nations have 

singled out the “North-South” economic gap as an issue that must be tackled, since 

poverty appears to be a key contributing factor to instability and the ensuing transnational threats. Poverty robs governments of the resources and capabilities they need to 

maintain security, ensure good governance, and create the infrastructure for sustained 

economic growth. Moreover, economic decline coupled with explosive population growth 

in many failing and failed states swells the ranks of unemployed and disaffected youth, 

who in turn become prime recruits for extremist causes, terrorist cells, and warlord 

armies. But the problem is a circular one, since poor governance exacerbates poverty.

The environment outside a country’s borders also can play an important role in 

determining whether a developing state fails or succeeds. A peaceful, stable, and relatively benign international environment has been a sine qua non of China’s successful 

development in the past twenty-five years. In addition, the most economically successful areas of China are coastal regions with relatively easy access to the states in East 

Asia that have successfully globalized. Moreover, negative public opinion regarding the 

world outside a nation’s borders can promote domestic political instability and support 

for extremist groups and activities, as has been demonstrated by the reactions of many 

Muslims to Israel’s policies and actions toward the Palestinians and to U.S. policies 

toward the Israeli-Palestinian conflict and Iraq. 

The prospects for enhanced Sino-American cooperation on the issue of failing states 

have improved as a result of a shift in strategic perceptions in both Beijing and Washington. Although the danger of conflict over Taiwan continues to bedevil Sino-American 

relations, China and the United States need not become strategic competitors in an era 

of growing strategic interdependence. Rather, as a result of the acceleration and deepening of globalization, China, the United States, and the other globalizing states mutually 

face the dangers posed by transnational threats, which are exacerbated by the existence 

of failing states. Efforts to enhance U.S.-Chinese cooperation to meet these challenges 

will continue to be hampered by mutual mistrust of each other’s strategic intentions, 

however—a challenge addressed in more detail below. 

The United States and China will need to agree on the scope and focus of cooperation. While many of China’s interests are international in nature (e.g., improving energy 

security, reducing terrorism, and curbing the proliferation of WMD), when it comes to 

seeking stability, China’s priority areas can be seen as a series of geographically defined 

4

Strategies for dealing with 

failing states must contain 

long-term measures designed to 

address the causes of state 

failure and transnational 

threats as well as actions 

designed to reduce the nearterm dangers they pose. 

A peaceful, stable, and 

relatively benign international 

environment has been a sine 

qua non of China’s successful 

development in the past 

twenty-five years.

Although the danger of 

conflict over Taiwan continues 

to bedevil Sino-American 

relations, China and the 

United States need not 

become strategic competitors 

in an era of growing strategic 

interdependence. 
concentric circles radiating out from its borders. China has been most active in dealing with problems that arise in the first of these circles, which includes North Korea, 

Afghanistan, and Central Asia. China has also been taking an active role in seeking 

stability in South and Southeast Asia, which fall in the next ring. For instance, Beijing 

has modified its long-standing support for Pakistan, cultivated ties with India, and 

proposed a free trade agreement with the ten members of the Association of Southeast 

Asian Nations. Farther afield, China has been actively engaged in diplomatic efforts to 

improve relations and promote trade and economic development in both the Middle East 

and Africa. While generally eschewing active political and diplomatic efforts to resolve 

disputes, China has played a role in peacekeeping operations in Africa, the Caribbean, 

and the Balkans. The United States has a corresponding set of rings that covers a much 

greater area and includes vital U.S. interests in a number of regions that are not in close 

geographic proximity to U.S. borders. The areas where the two nations’ circles intersect, 

which include Central Asia, South Asia, and Northeast Asia, may offer the best opportunities for bilateral cooperation in the near term. 

Prescriptions for Action

Failing and failed states are generally countries that are the most disconnected from the 

process of global economic, political, and cultural integration and least prepared for the 

challenges of interacting with the larger world. To become viable, they must develop 

the policies and institutions that can enable them to become more deeply connected 

with the global community, especially economically. Good governance, security, and 

economic health in these troubled countries can often best be achieved by nurturing 

democratic, accountable governments and by developing free market and free trading 

economies—objectives that Chinese analysts now endorse. This endorsement marks 

a significant change from the past, when many Chinese would have condemned the 

promotion of democratic governments and market economies as efforts to “Westernize,” 

dominate, and exploit these countries.

On a practical level, China’s experience in overcoming the devastation of civil war, 

poverty, and economic backwardness could be an important asset in assisting in the 

reconstruction and revitalization of failed states and in helping weak and failing states 

to move into the “succeeding” category. Indeed, the willingness of some Chinese experts 

to acknowledge China’s own continuing difficulties in maintaining its economic progress 

and extending it throughout the country adds both credibility and relevance to its work 

in other countries. China could bring its own experience in the area of development to 

bear in at least three areas: 

• mass mobilization for major public works projects and job creation;

• provision of basic health care to remote areas; and

• economic reform, deregulation, and privatization of an enormous and inefficient 

state-run economy.

Recently, China has been cautiously increasing the export of its own experience 

to assist the underdeveloped world. This has been evident, for example, in the ChinaAfrica Cooperation Forum, through which China has focused less on providing financial 

assistance and more on sharing information and training to help African states improve 

governance and infrastructure development. 

The United States and China, having vital interests in reducing the dangers posed 

by failing states and having great ability to influence international affairs, could significantly leverage their impact through bilateral cooperation and cooperation within 

regional and global institutions. They could collaborate on both preventive and remedial

measures. Preventive measures would focus on heading off state failure in weak states 

through the use of a wide variety of political, diplomatic, economic, and legal means. 

5

While generally eschewing active 

political and diplomatic efforts 

to resolve disputes, China has 

played a role in peacekeeping 

operations. 

China’s experience in overcoming the devastation of civil war, 

poverty, and economic backwardness could be an important 

asset in assisting in the reconstruction and revitalization of 

failed states and in helping 

weak and failing states. 
Enhanced bilateral dialogue would be an especially important tool for identifying 

troubled states and potential crises and for exploring the resources available to foster 

stability and strengthen failing states. 

Remedial measures would include both near-term crisis steps and long-term reconstruction responses to state failure. Three major approaches were considered for immediate responses when a state fails: one, containment strategies that focus on fencing-in 

problems to keep instability from spreading; two, deal brokering, which often involves 

separating warring parties as a first step toward a peaceful settlement; and three, 

military operations that focus on compelling one or more parties into a cease-fire and 

negotiations.

While there was general agreement that the 2001 U.S. military intervention in 

Afghanistan was justified as self-defense in response to terrorist attacks from bases 

on Afghanistan’s territory, the Chinese remain suspicious when the United States takes 

military action to address problems without explicit UN approval, such as in the U.S. 

invasion of Iraq. Nevertheless, the Chinese do not rule out military measures in response 

to state failure and, indeed, have contributed their own peacekeeping forces for PKO in 

failed states under UN mandate. The Chinese also support a wide range of international 

economic and political efforts aimed at postconflict reconstruction and have contributed 

to the rebuilding of Afghanistan by providing economic assistance and Chinese personnel. The Chinese public and media are generally supportive of the Chinese government’s 

current and increased involvement in UN PKO, and the Chinese leadership has decided to 

enhance the military’s capability and training for engaging in such operations, including 

through establishing a new PKO training center for the People’s Liberation Army.

The Chinese view the United Nations, and especially the UN Security Council (UNSC), 

as the most important legitimating body for intervention in failing states and note that 

the United States, China, and the three other permanent members of the UNSC play a 

disproportionately large role in this council. “The UNSC is the core of the world’s collective security regimes,” according to one Chinese analyst. UNSC resolutions “reflect 

the realities of the international community and will be affected by the considerations 

of the great powers, especially the five permanent members of the UNSC.” The analyst 

added that recent approaches by the UNSC in dealing with state failure have affirmed the 

special influence of the United States on this body. The UNSC has “not only permitted 

the U.S. to apply various enforcement measures under a broad mandate,” he said, “but 

has also created a new normative, institutional and operative regime that far transcends 

the traditional method and which can be used to substitute for a collapsed system of 

governance without the consent of the state concerned.” 

Chinese and American analysts agree that the United Nations needs to be reformed to 

better address the causes as well as consequences of state failures and the transnational 

threats to which they are often linked. This is a project upon which the United States 

and China could cooperate closely. 

Even in a reformed United Nations, forging a broad consensus on the criteria for 

intervention in failing states, including the use of military force, is nevertheless likely to 

remain difficult. In the view of one Chinese expert, four circumstances could justify military 

intervention: one, to prevent the use of WMD against civilian populations; two, to protect 

access to resources critical to the global economic system; three, to prevent a regime from 

seriously harming the international community; and four, to stop genocide. This list does 

not necessarily represent criteria that would be supported by the Chinese government, but 

it does appear to indicate new thinking in China about the legitimacy and necessity of 

intervention in the internal affairs of another state in certain extreme conditions. 

Beyond the United Nations, China and the United States could seek to strengthen the 

ability of other regional and global institutions to deal more effectively with the wide 

range of problems associated with areas of instability and new transnational threats. 

China and the United States could build on their already-established cooperation in 

the Asia Pacific Economic Cooperation forum (APEC), the Asian Development Bank, 

6

The Chinese remain suspicious 

when the United States takes 

military action to address 

problems without explicit UN 

approval. . . . Nevertheless, the 

Chinese do not rule out military 

measures.

Chinese and American analysts 

agree that the United Nations 

needs to be reformed. . . . This 

is a project upon which the 

United States and China could 

cooperate closely.
the International Monetary Fund, the World Bank, and other relevant institutions such 

as the International Maritime Bureau. In cooperation with the states concerned, the 

United States and China could also develop specific counterterrorism initiatives targeted 

at Southeast Asia and Central Asia. Such initiatives could build on significant, alreadyexisting Sino-U.S. collaboration in areas such as intelligence sharing, police work, and 

cargo inspection. Additionally, the United States and China could work together to 

increase U.S. cooperation with the Shanghai Cooperation Organization (SCO), especially 

between the SCO and U.S. forces in Central Asia, although China remains wary of the U.S. 

presence in the area. 

Challenges to Bilateral and Multilateral Cooperation 

Many Chinese experts agree that intervention in failing and failed states—even through 

the use of military force—may be legitimate and even necessary to protect the international community and the people of the particular state. But the challenges facing 

enhanced cooperation between China and the United States are considerable.

Of perhaps greatest concern is continued mutual suspicion and lack of strategic trust. 

At present, China and the United States appear to have developed significant tactical 

trust and cooperation, but strategic trust is still lacking, in part due to opponents of 

closer bilateral cooperation in both countries. A lively debate continues in China about 

accepting U.S. leadership or “hegemony”—and whether the United States sees China as 

a long-term strategic competitor. In addition, some people in China are still opposed 

to cooperating with the United States in actions perceived as interfering in the internal 

affairs of other states. On the U.S. side, some factions in the U.S. government and scholarly community predict that China and the United States will become strategic competitors in the long run as China becomes stronger economically and militarily, and thus they 

are wary of seeking to enhance Sino-American cooperation.

In addition, many Chinese experts are concerned about the widespread suspicion 

within weak and failing states about the motives behind the intervention of foreign 

powers, especially the United States. Chinese experts also maintain that U.S. “enthusiasm” about exporting its political and economic systems is sometimes counterproductive to solving the problems of these troubled regions. Some Chinese analysts contend 

that certain U.S. methods for fighting terrorism, especially as exemplified by the war in 

Iraq, may be creating more terrorists than are being eliminated. Moreover, many states 

perceive the United States as having acted in recent years in ways that devalue the 

international system and the institutions that were established through U.S.-led efforts 

after World War II.

Sino-American cooperation on failing states and transnational threats could be 

undermined by bilateral disputes over trade, human rights, and, above all, Taiwan. It 

could also be hampered by bureaucratic infighting and competition within the respective 

governments for resources from organizations committed to meeting traditional security 

concerns. In addition, differences between the U.S. and Chinese political systems may 

limit how closely the two sides can cooperate or, at the very least, how quickly cooperation and trust can develop. In light of these domestic structural constraints, expectations 

should be modest, at least initially. In this regard, the United States, some Chinese fear, 

could expect too much from China. 

Another group of challenges centers on the activities of nongovernmental organizations (NGOs). NGOs can play constructive roles in addressing many of the challenges 

associated with areas of instability and nontraditional, transnational threats (especially 

humanitarian disasters, public health crises, corruption, and environmental degradation). 

But the development of NGOs in China will pose difficult choices for Chinese leaders. 

On the one hand, China needs to develop its NGO community to supplement Chinese 

government involvement in areas of instability and to meet the growing needs of China’s 

7

The challenges facing enhanced 

cooperation between China and the 

United States are considerable.

Chinese experts also maintain 

that U.S. “enthusiasm” about 

exporting its political and economic systems is sometimes 

counterproductive. . . . [M]any 

states perceive the United 

States as having acted in recent 

years in ways that devalue the 

international system.
civil society, from which the government has been rapidly withdrawing its participation 

and support. At the same time, the government continues to be concerned that domestic 

NGOs could disrupt society and create associations that are outside state oversight, thereby 

diminishing the government’s power and potentially feeding political dissent. Consequently, 

there continues to be little genuine NGO involvement in China’s own political, social, and 

economic development, and at this point there is little support in the government for 

encouraging the development of Chinese NGOs that would have the capacity to become 

involved in foreign countries.

Policy differences constitute still another major challenge. Even if China, the United 

States, and other countries have the political will to cooperate, there can be difficulties 

in developing common policies toward specific failing states and transnational threats. 

This can be seen, for example, in the differences among the United States, South Korea, 

Japan, and China in dealing with North Korea, and those among the United States, 

Japan, Russia, and European countries in dealing with Iran. Because such differences 

can impede effective bilateral and multilateral cooperation, unofficial U.S.-China dialogue on these issues is all the more critical in minimizing misunderstandings and differences and maximizing the prospects for coordinated policies and actions. 

Cooperative strategies will also have to accommodate disparities in the United States’ 

and China’s respective historical experiences regarding approaches to failing states and 

transnational threats. Periodically intervening in weak and failing states or supporting 

multilateral intervention, at times through the use of military force, the United States has 

actively engaged—albeit reluctantly—in the arduous business of “nation building.” U.S. 

attitudes toward nation building have been shaped by its traditional desire to promote 

democratic values, as well as by its post–World War II experiences in rebuilding war-torn 

Europe and Japan, areas regarded as vital to global prosperity and stability. China, in contrast, has been largely an observer of conflict and disruption in areas of instability, focusing 

on its own internal problems of development. Additionally, for much of its post–civil war 

history, China has viewed Western intervention in the Third World as acts of “imperialism,” 

“neocolonialism,” and more recently “hegemony.” Proposals to enhance Sino-American and 

international cooperation on failing states will need to take into account these differing 

historical experiences. They will also need to be sensitive to the disparate political and 

cultural traditions of individual countries and subnational groups within failing states. 

Agenda for Government-Government Cooperation

A parallel evolution in the foreign policies of China and the United States appears to be 

narrowing the gap in perception of the nature and origin of threats to national security 

emanating from failing states, greatly improving the prospects for increased bilateral 

cooperation. To best exploit the current window of opportunity, cooperation between 

the two governments should proceed in a pragmatic and gradual manner. Specifically, 

the United States and China should take the following steps.

• Increase information sharing and dialogue on issues of common concern.

■ Identify issues and areas amenable to effective U.S.-China cooperation, including

 ◆ opportunities for engaging in both preventive and remedial measures to deal 

with failing and failed states, such as Pakistan, North Korea, and Central Asian 

nations;

 ◆ possibilities for coordinating nation-building and state-building efforts to 

strengthen governance and institutions within weak states, such as increased 

coordination in Afghanistan;

 ◆ specific measures to counter nontraditional and transnational threats, including 

piracy, drug trafficking, the spread of infectious diseases, and environmental 

degradation; and

8

Even if China, the United 

States, and other countries 

have the political will to cooperate, there can be difficulties 

in developing common policies 

toward specific failing states 

and transnational threats. 
 ◆ mechanisms to cooperate on peacekeeping and peace-enforcement operations to 

strengthen international order, including PKO cooperation between the U.S. and 

Chinese militaries.

 ■ Develop an agenda of concrete steps to build strategic trust and to optimize operational capabilities for joint actions.

• Improve cooperation and capacity building for joint action and interoperability.

 ■ Establish a mechanism to coordinate near-term and long-term remedial and preventive measures to deal with specific failed and failing states, including the coordination of state-building efforts designed to strengthen governance and institutions 

within weak states. 

 ■ Establish mechanisms to coordinate measures to respond to nontraditional and 

transnational threats. 

 ■ Identify the organizations and agencies within each government that are responsible for the various potential cooperative efforts and establish lines of communication between counterpart organizations.

 ■ Establish a mechanism for dialogue and cooperation on the reform of the United 

Nations and other international institutions. 

 ■ Educate the publics of both countries about the nature of the threats emanating 

from areas of instability and the need for U.S.-China cooperation to meet these 

challenges.

 ■ Demonstrate sensitivity to national and regional concerns about cooperation 

between a strong United States and a rising China through dialogue and consultation with regional states about the scope and intentions of bilateral cooperation 

on nontraditional and transnational threats.

Agenda for Track-Two Dialogue 

While an ambitious government-government program of cooperation can be foreseen, 

further track-two dialogue will be essential to push this Sino-American cooperative effort 

forward. Initial steps in this direction by nongovernmental actors should be taken in 

accordance with the following guidelines: 

• Agree on specific countries as subjects of bilateral dialogue and factual analysis to 

develop common understanding and proposals for cooperation between the two governments. Countries that might be the focus of such dialogue include those on China’s 

periphery in South, Central, and Southeast Asia, as well as North Korea. 

• Agree on specific transnational issues as areas for further dialogue and cooperation. 

These could include not only the issues of terrorism and proliferation but also others, 

such as maritime security, energy security, religious extremism, ethnic tensions, and 

Northeast Asia security.

• Identify remedial and preventive measures amenable to effective U.S.-China cooperation in order to have options available to support and expand governmentgovernment discourse. 

• Develop recommendations for actionable policies aimed at building strategic trust between 

the United States and China that also leverage the operational impact of joint actions.

• Identify the organizations and agencies within each government that are responsible 

for the various potential cooperative efforts.

• Examine the current roles of NGOs in education, anticorruption, public health, environmental protection, and humanitarian relief in both nations and propose ways for 

the two governments to better coordinate with NGOs. 

9

Further track-two dialogue will 

be essential to push this SinoAmerican cooperative effort 

forward. 
10

Conclusion

The United States and China increasingly share perceptions of the threats and challenges emanating from failing states and recognize the need for preventive and remedial 

measures to address these dangers. This convergence of perspectives allows for the possibility of enhanced Sino-American cooperation, and such bilateral cooperation could 

be a central element in strengthening the United States and China’s broader strategic 

relationship over the next few years. 

Enhanced cooperation between the United States and China on failing states and transnational threats could have bilateral, regional, and global benefits. On the international 

level, both nations working together could marshal more resources to address common 

threats and challenges. They could jointly help improve the effectiveness of multilateral 

organizations. The bilateral benefits of such cooperation could include less misunderstanding of each side’s unilateral policies toward third countries, such as in the cases of the 

U.S. military presence in Central Asia and China’s activities in Myanmar, and a demonstration that the two countries can work together on issues of common strategic concern—a 

critical step toward building domestic support in each country for Sino-American strategic 

cooperation. In addition, acting jointly on specific problems could help build strategic 

trust between the United States and China at a critical point in the evolution of their 

bilateral relationship.

These gains will be realized, however, only if flashpoints in Sino-American relations 

can be successfully managed and other obstacles overcome. To gain support within each 

country, cooperation should be mutually beneficial and based on common understanding and agreements. The U.S. approach to decision making will need to belie Chinese 

perceptions of a U.S. tendency to dictate to coalition partners. 

Although significant obstacles stand in the way of enhanced U.S.-Chinese cooperation on the problems posed by failing states and transnational threats, the impetus to 

overcome these obstacles may strengthen rather than weaken in the next few years, 

especially if the problems become increasingly prominent. Closer Sino-U.S. coordination 

will not only serve U.S. and Chinese interests with regard to minimizing the threats 

emanating from failing states but also build mutual trust and provide a crucial strategic 

complement to the growing U.S.-China economic relationship, thereby underpinning 

long-term stability and development of U.S.-China relations. 

Enhanced Sino-U.S. cooperation 

on failing states and transnational threats could have 

bilateral, regional, and global 

benefits. 

Although significant obstacles 

stand in the way of enhanced 

U.S.-Chinese cooperation . . . 

the impetus to overcome these 

obstacles may strengthen 

rather than weaken in 

the next few years.
11

Box A: China’s Position Paper on Enhanced Cooperation in the Field of 

Nontraditional Security Issues (Excerpts) 

• [M]any traditional security issues triggered by ethnic, religious, territorial 

and natural resources disputes are far from being resolved. The September 

11th incident indicates that nontraditional security issues as represented by 

international terrorism are of graver concern. 

• Terrorism, illicit drug(s), HIV/AIDS, piracy, illegal migration, environmental 

security, economic security, information security and other nontraditional 

security issues are more pronounced. The hallmark of these issues is that 

they are, in most cases, trans-national or trans-regional and are detrimental 

to the stability of all countries.

• Nontraditional security issues are very complicated as they are products of 

interwoven political, economic, ethnic, religious and other contradictions 

and have emerged against a profound historical and cultural background. 

Poverty, development gap, social injustice and unfairness are a hotbed of 

nontraditional security issues.

• Trans-national issues need a trans-national cooperation. Given the transnational and trans-regional nature of nontraditional security issues, enhanced 

coordination and closer regional and international cooperation among all 

countries are the only way to effectively meet the new challenges brought by 

these issues.

• Prevention should be the priority in addressing nontraditional security 

issues.

• As a responsible member of the international community, China stands ready 

to develop coordination and cooperation with other countries in the field 

of nontraditional security issues . . . to have further nontraditional security 

dialogue and cooperation so as to make a positive contribution to the maintenance of regional peace and stability.

Ministry of Foreign Affairs, May 2002 
12

Box B: China’s Participation in UN Peacekeeping Operations

• UN Truce Supervision Organization (UNTSO), November 1989–present, 66 

military observers.

• UN Iraq-Kuwait Observer Mission (UNIKOM), April 1991–present, 161 military observers.

• UN Mission for the Referendum in Western Sahara (MINURSO), September 

1991–present, 214 military observers.

• UN Operation in Mozambique (ONUMOZ), December 1992–December 1994, 

20 military observers.

• UN Advance Mission in Cambodia (UNAMIC), October 1991–March 1992, 3 

military observers.

• UN Transitional Authority in Cambodia (UNTAC), March 1992–September 

1993, 97 military observers and engineering troops.

• UN Observer Mission in Liberia (UNOMIL), September 1993–September 

1997, 33 military observers.

• UN Special Mission in Afghanistan (UNSMA), May 1998–January 2000, 2 

military observers.

• UN Observer Mission in Sierra Leone (UNAMISL), October 1999–present, 24 

military observers.

• UN Transitional Administration in East Timor (UNTAET), January 2000–present, 178 civilian police.

• UN Mission in Ethiopia and Eritrea (UNMEE), October 2000–present, 15 

military observers.

• UN Mission in Bosnia and Herzegovina (UNMIBH), January 2001–December 

2002, 20 civilian police.

• UN Organization Mission in the Democratic Republic of Congo (MONUC), 

April 2001–present, 20 military observers. In April 2003 China sent an 

engineering company of 175 soldiers and a medical team of 43 to the 

Democratic Republic of Congo to join the UN mission.

• Liberia (UNMIL), December 2003–present. China sent a peacekeeping force 

of 550 people to Libya at the request of UN special representative Clarke. 

The first 60 were dispatched on December 9. This marks one of China’s largest overseas missions in UN history.

Note: In 1990 China began to assign military observers to UN peacekeeping operations; since 

then it has sent 437 military observers in 32 groups to join six UN peacekeeping operations: 

UNTSO, UNIKOM, UNTAC, MINURSO, ONUMOZ, and UNOMIL. China still has 32 military observers 

serving with the UNTSO, UNIKOM, and MINURSO missions.

In 1992 the Chinese government dispatched an engineer unit to support the UNTAC peacekeeping operations. A total of 800 men were sent in two batches, and in eighteen months they 

repaired or expanded four airports, repaired four highways totaling 640 kilometers, built or 

rebuilt forty-seven bridges, and completed many other service projects, making useful contributions to the successful operations of the UN peacekeeping forces in Cambodia. 

In May 1997 the Chinese government decided that, in principle, China would take part 

in the United Nations’ stand-by arrangements and would provide military observers; civilian 

policemen; and engineering, medical, transportation, and other logistic service teams in due 

time for UN peacekeeping operations. Chinese personnel assisting UN peacekeeping operations 

have conscientiously fulfilled their responsibilities and made great contributions to world 

peace. Some of them have even sacrificed their lives. In the years to come, China will continue 

to participate in UN peacekeeping operations in a positive and down-to-earth manner.
13

Box C1: China’s Aid Activities in Failing and Weak States in Asia

• Afghanistan. The Chinese government pledged US$15 million to Afghanistan 

in 2004 for its reconstruction, and it will also participate in a series of 

reconstruction projects in Afghanistan. Foreign Minister Li Zhaoxing said 

China would offer this US$15 million to Afghanistan following the US$47 

million in aid it contributed in 2003 under a 2002 commitment of US$150 

million in donations to be given over a five-year period.

• North Korea. China supplies 70 percent of North Korea’s energy and 40 

percent of its food. China’s exports to North Korea, primarily crude oil, oil 

products, grain, and food items, amounted to US$330 million in 1999 and a 

little over US$450 million in 2000 (7/4/03, Korea Times). The government 

of the People’s Republic of China decided to offer a grant-in-aid equivalent 

to 50 million yuan (US$6 million) to the Democratic People’s Republic of 

Korea on the occasion of the ninetieth birthday of the late president Kim Il 

Sung (4/27/04, People’s Korea).

• Pakistan. China donated US$2.4 billion in financial assistance to Pakistan 

for the latter to undertake three mega–development projects (6/29/04, 

Projects Today). China allocated a special fund to provide emergency aid to 

Pakistan and five other Asian countries to cover the damage caused by the 

bird flu (2/15/04, World Veterinary Association). China’s visiting defense 

minister has pledged a US$12 million interest-free loan for Pakistan’s armed 

forces to strengthen and develop ties between the two countries’ armed 

forces, reported the official Associated Press of Pakistan. 

• Cambodia. The Chinese government donated a batch of appliances for severe 

acute respiratory syndrome prevention, valued at US$45,000, to the Cambodian government. The appliances included portable thermometers, protective clothing, and gauze masks (7/3/03, People’s Daily). China donated 16.4 

million yuan (US$2 million) to construct Cambodia’s Senate library and three 

office buildings. 

• Central Asia–Shanghai Cooperation Organization (SCO) Members. China decided 

to offer a total of $US900 million in preferential buyer’s credit loans to the 

other five members of the SCO (6/18/04, People’s Daily).
14

Box C2: China’s Aid Activities in Failing and Weak States in Africa and the 

Middle East

• Iraq. The Chinese government decided to provide the Jordanian government with emergency aid materials for humanitarian purposes, according to 

sources within the Chinese Foreign Ministry (3/23/03, People’s Daily). China 

pledged US$24.2 million for the reconstruction of Iraq. 

• Angola. An economic housing project has already been completed with 

Chinese assistance. China has relieved all of Angola’s expired debt, which 

should have been repaid by the end of 1999. 

• Burundi. Projects include a joint Chinese-Burundi textile mill in Bujumbura, 

the Mugere Hydropower Station, a high-voltage electric transmission system, a highway from Bujumbura to the Nile River, a handicrafts training 

center for making bamboo-rattan-grass products, a reclamation project for 

the No. 7 highway, and a sewing workshop. 

• Central African Republic (CAR). Following a March 15, 2003, coup by former 

armed forces chief of staff François Bozize, China donated equipment worth 

US$4 million, including corrugated iron sheets, 110 computers, bicycles, 

and office supplies, to the CAR to help rebuild military barracks and civil 

services infrastructure.

• Nigeria. China has donated N300 million (US$3 million) worth of antimalarial drugs to the Federal Ministry of Health to aid the government’s Roll 

Back Malaria Program. 

• Sierra Leone. China has helped Sierra Leone to complete numerous construction projects, including a station for popularizing rice-cultivation techniques, bridges, the National Stadium, sugar complexes, office buildings, 

hydropower stations, power transmission stations and substation projects, 

and civil housing. Projects still in the works are the maintenance of governmental office buildings and the army’s headquarters office building, and 

agricultural technological cooperation. 

• Somalia. China has completed the following assistance projects in Somalia: 

the National Theatre, the Hargeisa water supply project, the Somalia Cigarette Manufactory, the Somalia Banadir Hospital, the Somalia Stadium, a 

road between Beled Weyne and Burao, Barrouen Farm, Fanole Farm, and a 

hydropower station.

• Sudan. An agreement to finance the Kajbar Dam project, located at the 

Nile’s second cataract, was signed between Sudan and China in September 

1997. (This 300-megawatt-capacity dam is currently under construction.) 

Under the terms of the agreement, China is financing 75 percent of the 

project (approximately US$200 million) and Sudan is to provide the remaining 25 percent of funding.
15

Box D: China’s Evolving Nonproliferation Policy

• China joined the International Atomic Energy Agency (IAEA) in 1984 and 

voluntarily placed its civilian nuclear facilities under IAEA safeguards. Since 

its accession to the IAEA, China has established a State System for the 

Accountancy and Control of Nuclear Materials and a Nuclear Materials Security System that measure up to the requirements set by the Convention on 

the Physical Protection of Nuclear Materials.

• Since 1988 China has, on an annual basis, submitted to the United Nations 

the declaration data of the confidence-building measures for the Biological 

Weapons Convention (BWC) in accordance with the decision of its Review 

Conference.

• China acceded to the Treaty on the Nonproliferation of Nuclear Weapons in 

1992.

• The Chinese government declared in 1992 that it would act in line with the 

guidelines and parameters of the Missile Technology Control Regime (MTCR) 

in its export of missiles and related technologies.

• In 1994 China committed to not exporting ground-to-ground missiles featuring the primary parameters of the MTCR, i.e., those inherently capable of 

reaching a range of at least 300 km with a payload of at least 500 kg. 

• In 1998 the Chinese government promulgated the Regulations of the People’s Republic of China on the Control of Nuclear Dual-Use Items and Related 

Technologies Export.

• China issued the Regulations on the Import and Export Control of Technologies in 2001 to stipulate that strict control shall be exercised over the export 

of nuclear technologies, technologies related to dual-use nuclear products, 

production technologies of controlled chemicals, and military technologies. 

The Customs Law of the PRC and the Administrative Punishments Law of the 

PRC also provide a legal basis for nonproliferation export control.

• In October 2002 the Chinese government promulgated the Regulations of 

the PRC on the Export Control of Dual-Use Biological Agents and Related 

Equipment and Technologies.

• In November 2002, China issued the Military Products Export Control List as 

a supplement to the Regulations on the Administration of Arms Export. The 

list contains a detailed classification of conventional weapons and armaments. 

This framework consists of four levels of weapons components directly related 

to weapons equipment, thus providing scientific and legal guarantees for 

strengthening the control of the arms trade and arms export.

• China applied to join the Nuclear Suppliers Group (NSG) on January 26, 

2004, and was accepted as a member in Gothenburg, Sweden, on May 28 

of the same year. As a member of the NSG, China will strictly abide by its 

principles and requirements in controlling the export of nuclear and nuclear 

dual-use items. 
An online edition of this report can be 

found at our website (www.usip.org), 

together with additional information 

on the subject.

United States 

Institute of Peace

1200 17th Street NW

Washington, DC 20036

www.usip.org

Of Related Interest

A number of other publications from the United States Institute of Peace focus on China 

and on cooperation and enhanced understanding China between and the United States. 

Recent Institute reports include:

• Democratic Values, Political Structures, and Alternative Politics in Greater China, by David 

Zweig (Peaceworks, July 2002)

• From Revolutionary Internationalism to Conservative Nationalism: The Chinese Military’s 

Discourse on National Security and Identity, by Nan Li (Peaceworks, May 2001)

• ”Trialogue”: U.S.-Japan-China Relations and Asian-Pacific Stability (Special Report, 

September 1998)

• The China Challenge in the Twenty-First Century, by Chen Jian (Peaceworks, June 

1998)

To obtain an Institute report (available free of charge), write United States Institute of 

Peace, 1200 17th Street NW, Suite 200, Washington, DC 20036-3011; call (202) 429-3832; 

fax (202) 429-6063; or e-mail: usip_requests@usip.org.

Recent books from USIP Press include:

Chinese Negotiating Behavior: Pursuing Interests through “Old Friends,” by Richard H. 

Solomon (1999)

For book sales and order information, call 800-868-8064 (U.S. toll-free only) or 703-661-

1590, or fax 703-661-1501.