THE RISE OF CHINA IN ASIA:

SECURITY IMPLICATIONS

Edited by

Carolyn W. Pumphrey

January 2002
*****

The views expressed in this report are those of the authors and do

not necessarily reflect the official policy or position of the Department of

the Army, the Department of Defense, or the U.S. Government. This

report is cleared for public release; distribution is unlimited.

*****

I would like to acknowledge my debt to the following persons: Dr.

Peter Feaver, the Director of the Triangle Institute for Strategic

Studies; Dr. Emerson Niou, the Director of Duke University’s Program

in Asian Security Studies (PASS); and Dr. Douglas Lovelace, Colonel

Bernard Zipp, Lieutenant Colonel Lawrence Papini, and Dr. Andrew

Scobell of the Strategic Studies Institute, U.S. Army War College. All of

them gave me vital assistance at various stages of this project. I would

also like to thank Rye Barcott and Heather Messera (both of the

University of North Carolina-Chapel Hill) for their help at the

conference. Above all, I would like to thank Drs. Joseph Caddell and

Louisa Kilgroe of North Carolina State University who provided

invaluable critical input when it was most needed.

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forwarded to: Director, Strategic Studies Institute, U.S. Army War

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Rita.Rummel@carlisle.army.mil

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ISBN 1-58487-082-6

ii
CONTENTS

Foreword.................................v

1. Introduction..............................1

Carolyn W. Pumphrey

I. GREAT POWER TRANSITIONS . . . . . . . . . . . . . . . . 19

2. China and America in the New World Polity . . . . . . . . . . . 21

Joseph Grieco

3. Hegemonic Prophesy and Modern Asia:

Lessons for Dealing with the Rise of China . . . . . . . . . . . . 49

Kurt Campbell

II. IS CHINA A SECURITY THREAT? . . . . . . . . . . . . . . 63

4. Rising China: A Threat to Its Neighbors? . . . . . . . . . . . . . 65

Michael R. Chambers

III. ASIAN GREAT POWERS. . . . . . . . . . . . . . . . . . . . 93

5. Assessing India’s Response to the Rise of China:

Fears and Misgivings . . . . . . . . . . . . . . . . . . . . . . . . 95

Sumit Ganguly

6. Chinese Perceptions of India: Brief Comments . . . . . . . . . 105

Susan Shirk

7. Historical Ironies, Dividing Ideologies

and Accidental “Alliance”:

Russian-Chinese Relations into the 21st Century . . . . . . . . 111

Yu Bin

8. Changing Japanese Views of China: A New Generation

Moves Toward Realism and Nationalism. . . . . . . . . . . . . 161

Tsuneo Watanabe

IV. FLASH POINTS IN EAST AND SOUTH ASIA . . . . . . . 189

9. The U.S. Security Commitment to Taiwan

Should Remain Ambiguous . . . . . . . . . . . . . . . . . . . 191

Brett V. Benson

Emerson M. S. Niou

10. North Korea on the Brink: Breakdown or

Breakthrough? . . . . . . . . . . . . . . . . . . . . . . . . . . 197

Andrew Scobell

11. The Rise of China: Implications for Security Flashpoints

and Resource Politics in the South China Sea ......... 229

David Rosenberg

12. The Gestalt of Sino-Indian Relationship . . . . . . . . . . . . 263

John W. Garver

V. SINO-AMERICAN RELATIONS. . . . . . . . . . . . . . . . 287

13. Bush and China: Thinking Strategically

about Upcoming Choices . . . . . . . . . . . . . . . . . . . . . 289

David M. Lampton

About the Contributors. . . . . . . . . . . . . . . . . . . . . . . . 303

iii
iv
FOREWORD

In March 2001, the U.S. Army War College, the Triangle

Institute for Security Studies, and Duke University’s

Program in Asian Security Studies cosponsored a

conference in Chapel Hill, North Carolina. The conference

examined the security implications of the rise of China for

the international community in general and for the United

States in particular.

This book, which includes an introduction and 12

presentations from the conference, comprises some of the

major findings of participants and attendees. Sections of the

book address China as a rising power, China as a security

threat, the other Asian powers in relation to China, the

flashpoints in East and South Asia, and Sino-American

relations.

The Strategic Studies Institute is pleased to publish this

volume as a contribution to the debate on China’s increasing

role on the world scene.

DOUGLAS C. LOVELACE, JR.

Director

Strategic Studies Institute

v
CHAPTER 1

INTRODUCTION

Carolyn W. Pumphrey

INTRODUCTION

On March 2-3, 2001, the U.S. Army War College, the

Triangle Institute for Security Studies, and Duke

University’s Program in Asian Security Studies

cosponsored a conference in Chapel Hill, North Carolina.

The purpose of the conference was to examine the security

implications of the rise of China for the international

community in general and for the United States in

particular. This introduction will synthesize some of the

main findings of conference participants and attendees.

IS CHINA RISING?

China boasts the oldest continuous civilization in the

world and has been a major power for most of its history.

Although China suffered a period of decline in the late 19th

and early 20th centuries, recent decades have seen a

remarkable resurgence of Chinese prosperity and power.

Five years ago analysts were confidently predicting that

China would be the giant of the new century.1 Today, this is

less clear. The first task of the conference was,

consequently, to ascertain whether or not it is still

appropriate to speak of the rise of China.

All agreed that China has made tremendous economic

progress since the 1970s when it was one of the world’s least

developed countries. By the end of the 20th century, it had

one of the largest economies in the world (between the

1
seventh and the second largest, depending upon what

sources you consult). In terms of population, it clearly ranks

among the great powers. In July 2000, its population was

estimated at 1,261,8332,482 people. China is also a rising

military power, allocating an increasing amount of its

budget towards military modernization and placing

increasing stress on the use of force.

China successfully weathered the economic crisis of

1997-98 and does not appear to be in imminent danger of

economic stagnation or decline. The future, however, is less

certain. Some conference participants prophesied a

continued rise in Chinese economic power, while others

anticipated the possibility of a dramatic fall (the most likely

date for which would be between 2005 and 2010). In the final

analysis, we do not know whether China will rise or fall. We

would do well to heed the warnings of Kurt Campbell who

stressed the disastrous track record of hegemonic

prophecies. Over the course of the last half-century, the

Soviet Union (1970s), Japan (1980s), China (late 1990s),

and most recently India, were hailed as the up-and-coming

economic superpowers. American economic power was

widely expected to collapse. All of these predictions proved

to be unfounded.

ARE GREAT POWER TRANSITIONS

THREATENING?

Closely related to the question of whether or not China is

a rising power is the question of whether or not the rise of a

great power poses a challenge to international security. The

answer given at the conference was that any change in the

balance of power is likely to cause a certain amount of

instability as states seek to adjust themselves to the new

order. However, increased power does not necessarily mean

increased threat.

Great power transition theories suggest that changes in

the balance of power have the potential to disrupt the

international order. Conference participants tended to

2
agree with this generalization. John Garver confirmed that

states do go to war to preserve a favorable “structure” of

power. The Chinese and the Indians, for example, both

believe that their security depends on whether or not they

can maintain advantageous positions in key parts of the

South Asian Indian Ocean Region. If they think that they

are losing their advantage, they may feel compelled to

“defend” themselves by going to war.

On a slightly different note, Tsuneo Watanabe pointed

out how the collapse of the Soviet Union contributed to

rising Sino-Japanese rivalry. Each nation now came to view

the U.S. presence in East Asia in a very different way. The

Japanese sought to increase military ties with the U.S. and

thereby increase their national security. The Chinese, by

contrast, hoped that the U.S. would help contain the growth

of Japanese power. Kurt Campbell emphasized yet another

very important point. The decline of a so-called minor power

can be as destabilizing as the decline of a great power.

Indonesia, for instance, was the driving force behind

multilateralism in Asia. Asia generally lacks formal

institutions capable of dealing with either abrupt or subtle

shifts in the international balance of power. The collapse of

Indonesian power thus added to an already considerable

problem.

Interestingly, however, there does not appear to be a

precise correlation between increased power and increased

threat. Certainly, conference participants differed as to

what might result from China’s continued economic rise. On

the one hand, Joseph Grieco expressed a concern that

increased wealth would merely serve to increase Chinese

capabilities. Some international relations theories suggest

that as a nation becomes more prosperous and more

integrated into the world economy, it will become more

democratized and more anxious to preserve the world order

that has made its prosperity possible. However, evidence

from China seems to contradict this. China has indeed

become wealthier over the last decades, but this has not

prevented it from wanting to change the status quo in Asia.

3
This suggests that increased Chinese wealth will not

necessarily result in decreased Chinese aggression.

On the other hand, Michael Chambers was equally

worried about the possibility of a Chinese decline. He

argued that economic failure would undermine the

legitimacy of the current regime. A new regime would, in all

likelihood, be more nationalistic and more apt to make a

scapegoat of the West. While a weaker China would have

more limited capabilities, a weaker China might also have

more aggressive intentions. Cost benefit analysis suggests,

in short, that world order would not necessarily be well

served by Chinese decline.

THREAT EVALUATIONS: ANALYTICAL

PROBLEMS

The main purpose of the conference was to evaluate the

threat posed by China to international security. Threats

result from the combination of hostile intentions and

credible capabilities.2 Consequently, both must be assessed.

A persistent, although not always explicit, theme of the

conference was the difficulty of this task. The problems

included the following.

Limited Access to Information.

Our access to information concerning China is still

relatively limited. Despite the fact that China has reformed

rather dramatically in some economic areas, it remains in

the control of a secretive and authoritarian regime. In some

ways, as David Lampton pointed out, our situation is even

worse now than it was in the time of Deng Xiaoping, who at

least had developed ties with the United States during

World War II and who had exposed his junior officers to the

West. The gaps and uncertainties in our information

inevitably complicate the task of threat evaluation.

4
Complexity of Asia.

Asia is difficult for us to understand. It is an enormous

and complex part of the world, but we must also bear in

mind, as Sumit Ganguly, Tsuneo Watanabe, and others

warn us, that no one Asian nation speaks with a single voice.

We must always take into account the existence of multiple

perspectives. To make matters worse, the problems in the

region are all inextricably linked. We focus on one area, to

the exclusion of others, at our peril.

Human Errors.

Analysis is further handicapped by human errors. Two

kinds of “mind-forged manacles”3 stand out. They are

ethnocentrism and gestalt. In the case of the former, our

preoccupation with the Western world has contributed to

our failure to understand China. In the case of the latter, as

John Garver observed, we all have a tendency to fit facts

into our preconceived ideas. Evidence of this abounds,

whether we are talking of Asians who persist, contrary to all

evidence, in seeing American decline where there is none, or

Americans who see Taiwanese flexibility where the Chinese

see Taiwanese intransigence.

Baffling Intentions.

It is particularly difficult to interpret intentions. China’s

intentions are neither obviously hostile nor obviously

aggressive. It does not appear to have hegemonic ambitions.

Its stated preference is to preserve the status quo. However,

there are some contrary indications, such as its

development of a nuclear warfighting doctrine and its

territorial claims to the Spratly Islands. Perhaps the

Chinese do have hegemonic ambitions and are deceiving us

into thinking that they do not. Perhaps they really do not

know what they intend. Perhaps the inconsistencies reflect

division of opinion within China. Perhaps their intentions

are mercurial.

5
We might hope to find a key to China’s intentions in

China’s past. Unfortunately, as historian Michael Howard

once wrote, “History, whatever its value in educating the

judgment, teaches no ‘lessons’. . . . The past is infinitely

various, an inexhaustible storehouse of information from

which we can prove anything or its contrary.”4 This is very

much true here. The Confucian tradition, with its strong

stress on the role of restraint and morality in war is evident

in China’s history.5 But so, too, are realpolitik and

machtpolitik. We cannot deduce from China’s ambiguous

past specifics about its future intentions. Indeed, the

inconsistencies in its behavior should make us guarded

about leaping to conclusions.

Intentions and Capabilities.

Two final points should be made about capabilities and

intentions. First of all, nations do not have to be

intentionally aggressive to pose a security threat. John

Garver spoke of security dilemmas whereby nations arm to

defend themselves against what might happen. In so doing,

they become a threat to their own neighbors, regardless of

whether or not they have aggressive designs against them.

In short, capabilities are a threat regardless of intentions.

Second, the perception of threat can matter as much as

the reality. Emerson Niou, for example, noted the

significance of perception in the standoff between the

People’s Republic of China (PRC) and the Republic of China

(ROC). The perception of what the United States will or will

not do to defend Taiwan plays a crucial role in determining

how far China and Taiwan are prepared to go in securing

their own goals.

ASIAN PERCEPTIONS

If we are to understand whether or not China is a threat

to the world order, it is important that we pay attention to

the perspectives of its Asian neighbors. This will serve as a

useful counterweight to our naturally ethnocentric

6
propensities. China is fringed by three great

powers—Japan, India, and Russia—all of whom might have

reason to fear a challenge to their security. There are also

numerous small powers in the region that might have

reason to fear Chinese ambitions. What will their reactions

be to the growth of Chinese power?

Positive Views of China.

For the moment at least, China is a continental power.6

Although it does have some long-range nuclear weapons, it

has little ability, beyond this, to project its power globally. It

is geared, as Chambers observed, to defending the Chinese

mainland from attack. China lacks a blue water navy and

has no aircraft carriers. Its air force is rather antiquated

and lacks long-range capabilities. It does have enough

military power, especially in the form of short-, medium-,

and intermediate-range missiles, to present a substantial

regional threat. Interestingly, however, most Asian nations

do not seem to perceive China as dangerous. They recognize

China’s economic and military power and even defer to

China’s wishes. But they apparently do not see China as a

security threat.

This confidence would appear to derive from a

perception that Chinese intentions are largely

nonaggressive. A number of things have contributed to this

perception. In the first place, China has played a rather

constructive role in the region in recent decades. It provided

aid to Asian countries (notably Thailand and Indonesia)

during the economic crisis of the 1990s. It has made efforts

to work with other Asian nations to deal with common

problems, including transnational threats, religious

fundamentalism, and piracy in the South China Sea.

Relations with its neighbors have improved since the 1990s,

thanks to diplomatic initiatives and confidence and

security-building measures.

Chinese foreign policy has also become more pragmatic

in recent decades. China (perhaps simply because the

7
opportunities no longer present themselves) no longer

threatens its neighbors by supporting communist

insurgencies. It has mended some fences with South Korea.

It is, according to Susan Shirk, willing to lower the profile of

its relationship with the Pakistanis in order to improve

relations with India. It has entered into what Yu Bin called

a “marriage of convenience” with Russia, despite the

growing ideological divide between the two nations. It has

also shown considerable powers of restraint when provoked.

The fact that China no longer seems to be guided by

crusading impulses doubtless contributes to the limited

sense of threat felt by its neighbors.

Asians are certainly also aware that the Chinese can ill

afford to be too ambitious at present. The Chinese

government faces a number of quite serious domestic

problems, ranging from discontented ethnic and religious

minorities to social unrest among peasants and workers.

For China to alienate its neighbors under these

circumstances would be to court disaster. All in all,

therefore, one can see why most of China’s neighbors do not

fear its rise.

Exceptions.

There are, of course, some exceptions. Three nations

remain deeply suspicious of China: Taiwan, India, and

Japan.

Taiwan. Both China and Taiwan have mutually

incompatible goals. China still insists on eventual

reunification with Taiwan, while Taiwan wants de facto if

not de jure independence. China has not renounced the use

of force and, while it may not have the ability to enforce its

will, it already has the power to inflict extensive material

and economic damage on the island.

India. According to Sumit Ganguly, many Indians see

China as a Bête Jaune. The earlier confidence that India did

not need to rely on force and that the Himalayas were

8
impassable was shattered by the Sino-Indian War of 1962.

China has not only grown in economic and military power, it

has also been successful in developing diplomatic relations

with neighboring states such as Burma, threatening India

with possible encirclement. Not all Indians have equally

serious misgivings about China, however. Extremists

believe that the solution lies in an India that “bristles with

missiles,” while the Bharatiya Janata Party (BJP) balances

a respect for Chinese achievements with confidence in

India’s potential. The Indian National Congress Party, on

the other hand, is profoundly terrified of China.

Japan. The Japanese also view China as a threat,

though not, perhaps, to the same extent as the Indians and

Taiwanese. Their sense of insecurity stems from the

hostility that the Chinese still feel towards the Japanese for

their wartime atrocities. The younger generation of

Japanese, in their turn, are angered by China’s

unwillingness to forgive and forget, and are increasingly

disturbed by Chinese civil rights abuses. Fears of China are

aggravated by the fact that, contrary to their expectations,

the Japanese have not emerged as the leading world

economic power and remain largely dependent on the US for

their security needs.

CHINA AND WORLD STABILITY

Asian nations do not, in general, perceive China as a

great threat to their individual security interests. Does this

mean that China is not a threat to global security?

Clearly, it must be recognized that the Chinese have

often played a constructive role on the world scene. We have

already noted that the Chinese enjoy good relations with

many of their Asian neighbors and, as Kurt Campbell

observed, this is a necessary ingredient of world stability.

China has shown itself to be a constructive force in other

ways as well. Andrew Scobell noted that its successful

economic reforms serve as something of an inspiration. The

lesson of what happens when you spend too much on the

9
military—Soviet collapse—combined with the lesson of

what happens when you reform your economy—the rise of

China—may well be the driving force behind the profound

changes taking place in Kim Jong Il’s North Korea. To be

sure, China fosters multipolarity, which may not be what

the United States wants, but this is not self-evidently a bad

thing.

At the same time, China contributes in a number of ways

to global instability. The threat it poses to the international

anti-proliferation regime is perhaps the most obvious

example. China is avidly seeking to buy weapons and still

more avidly gathering advanced technological knowledge.

Its developing ties with Russia, archenemy of the Cold War,

is thus more than a little alarming. China has also sold

nuclear technology to Pakistan and perhaps Iran, and

missile technology to Iran, Libya, Syria, and Pakistan. This

is all the more threatening in that none of these are

especially stable states.

Flash points.

One way to gauge the impact of China on the world scene

is to consider its role in key trouble spots in Asia: the Taiwan

Strait, the Korean Peninsula, the South China Sea, and

South Asia. All of these have emerged as dangerous flash

points, where the balance could easily be tipped towards

war, with disastrous implications for the world at large.

Taiwan. The Taiwan Strait is a particularly dangerous

region, where there is much room for misunderstanding,

and where conflict could very easily lead to a direct

confrontation between the United States and China. Susan

Shirk spoke of Taiwan as China’s one blind spot. The

Chinese have shown little ability to compromise over this

issue and have made a number of threatening gestures,

conducting military exercises in the Taiwan Straits in

1995-96 and claiming (February 2001) that they would not

wait forever for an agreement on reunification. While it is

possible to have sympathy for the Chinese perspective

10
(several participants noted that Taiwan has itself hardened

its position over time), it cannot be said that China has done

much to decrease tensions.

The Korean Peninsula. The Korea peninsula, as Andrew

Scobell noted, is another “powder-keg” region. North Korea

is a garrison-state, with formidable military forces and

nuclear weapons. It has long desired to achieve

reunification with South Korea by force or agreement.

Tensions have recently been declining in the region and the

outbreak of a major war now seems relatively unlikely.

Nonetheless, there is still a good chance of smaller-scale

conflict, which would almost certainly involve U.S. troops.

China, however, seems to be playing a constructive role in

the Korean peninsula at the present moment. Although at

one time it hoped for reunification of the two Koreas under

Pyonyang, it has improved relations with South Korea and

now appears to be trying to maintain the status quo and to

foster gradual, peaceful change.

South Asia. South Asia is another dangerous flash point.

The quarrel between India and Pakistan over Kashmir is

one that could escalate into a conventional or even a nuclear

conflict. Tibet and Burma are both countries of great

geopolitical significance to India and China and sources of

potential conflict between the two nations. China’s role in

this region is somewhat ambivalent. Susan Shirk sees the

Chinese as a primarily stabilizing force in the region. She

offers the example of their mature response to India’s

explosion of a nuclear bomb. The Chinese first tried to

persuade the Pakistanis not to test their bomb and then

joined the US in Geneva in an effort to prevent a nuclear

arms race. John Garver and Sumit Ganguly, in contrast,

both make it clear that China has also contributed to the

tensions in the region.

South China Sea. The South China Sea is a region where

conflicts are currently more numerous than intense. China,

Vietnam, the Philippines, Malaysia, and Brunei have

claims to the many resource-rich islands in the area. They

11
also quarrel over issues like fishing rights and

transboundary pollution. The area is also afflicted by

piracy. While China is part of the problem—it is one of the

nations claiming territory and resources—it must in

fairness be said that it is also part of the solution. China is

developing a regional code of conduct with ASEAN to govern

disputes in the region. It is cooperating on resource

management and other issues.

David Rosenberg does warn that the South China Sea

could become a still more vital and tempestuous area in the

future. China’s dependency on oil from the Middle East is

likely to increase if it continues to be interested in

commercial expansion. Consequently, controlling the Strait

of Malacca will be more crucial than ever. China,

significantly, is developing an increased interest in sea

power. While it currently recognizes the freedom of the seas,

it is, as Michael Chambers says, by no means evident that it

will continue to do so in the future. The situation could

highly explosive were China to cut off vital energy supplies

from East Asian nations.

THE UNITED STATES AND CHINA

No analysis of the security implications of the rise of

China would be complete without taking a look at

Sino-American relations. Conference participants seemed

fairly much in agreement here. China is not, they argued, a

direct military threat to the United States in the way that

the Soviet Union was during the Cold War. The United

States has vastly greater military power than does China.

Indeed, though China is a nuclear power, some analysts

believe that it does not at the moment have even a

second-strike capability. The gap is likely to grow over time.

On the other hand, if we define our national security

interests rather broadly, to include defense of our values,

our way of life, and our allies, it must be conceded that

China presents us with some significant challenges. Our

concern for the furtherance of democratic values creates a

12
certain amount of cognitive dissonance when we deal with

China. China is a potential threat to our economic

dominance. As David Lampton pointed out, the heavy

investment of other countries in China and the low pay of

Chinese workers mean that we find it hard to compete in

some industries. China also threatens some of our allies in

Asia and we run the risk of losing credibility if we fail to

stand up for their rights.

In addition, China works with other countries to try and

thwart U.S. interests. It would like to minimize U.S.

interests globally, although it has not, as yet, tried to

organize an anti-American coalition. The budding

Sino-Russian alliance deserves attention. If we are not

careful, in the view of Yu Bin, these unwilling bedfellows

will develop ever-closer military cooperation, which will

arguably not serve the best interests of world security.

Finally, as we have already noted, the United States has

a major military presence in the Far East. The United

States might be drawn into a confrontation with China in

Korea, or, more likely, over Taiwan. To this extent, China

clearly is a potential threat to the United States.

U.S. Policy towards China.

China has not replaced Russia as a significant global

threat. Equally clearly, however, Asia is a region in which

the United States has important interests and which needs

careful consideration. The final goal of the conference was to

give some thought to what the United States should do to

further its national interests and increase global security.

For the most part, discussion at the conference focused on

the policy known as strategic engagement, the very thorny

debate over missile defense, and how best to deal with

Taiwan. David Lampton stressed the fact that Americans

are very much divided on policy issues, even within parties,

and some of these divisions became clear at the conference.

13
Strategic Engagement. Strategic Engagement is a

strategy whereby the United States and its partners seek to

establish vigorous economic ties with China and to draw

China into a variety of regional and global economic,

political, and institutional arrangements. This strategy

rests on the assumption that this interaction will bring

about a China that is more accepting of the international

order and more committed to bringing about changes

through peaceful means. Americans have arguably followed

this strategy since President Nixon opened the door to

China in 1971. To ensure against problems, Americans have

generally tried simultaneously to improve their relations

with other Asian nations.

While conference participants seemed generally

satisfied with strategic engagement, Joseph Grieco drew

attention to a fundamental flaw in its logic. It is not true, he

said, that a more prosperous and commercially engaged

China will inevitably become a more peaceful and

democratic China. We should be wary about implementing

a strategy that will ensure that China becomes more

capable while not ensuring that it will become more

peaceful.

Missile Defense. Still more controversial were

evaluations of the wisdom of U.S. plans to build strategic

and theater missile defense systems. David Lampton

tended to be supportive of the idea, though he recognized the

need to lessen Chinese fears by, among other things,

reducing American offensive missiles.

Other participants were much more critical and offered a

wide range of reasons for their concern. Michael Chambers’

chief concern was that reliance on high-tech missile defense

systems, while simultaneously pulling back our

conventional forces, would erode our regional alliance

system in East Asia and undermine our credibility. Yu Bin

believed that the Bush administration’s determination to

deploy missile defense would drive Russia and China

towards a 1950s-style alliance at the expense of their

14
respective relations with the United States. Sumit Ganguly

argued that implementing missile defense would incite the

Chinese to modernize their nuclear forces, which would in

turn provide ammunition for those in India who want to see

an expansion of the Indian nuclear weapons and missile

programs.

Taiwan. Emerson Niou addressed the complex Taiwan

question, offering a defense of “strategic ambiguity.” While

some analysts believe that the United States should develop

clear policy directives, Dr. Niou argued that strategic

ambiguity is a constructive policy for the United States to

follow. To commit the United States to oppose Taiwanese

moves towards independence would only serve to encourage

militant activity by China. Alternatively, to clarify policy in

such a way as to give the advantage to the ROC might

embolden Taiwan to assert its independence and result in

violent reaction from the PRC. Strategic ambiguity, by

keeping everyone guessing, acts as a double deterrent and

has thus far helped to keep the peace.

Lessons.

As well as the more concrete proposals, conference

participants offered a number of general principles as

guidelines for action. Of these, four stand out. They can be

summed up as follows:

1. Know Thyself! We should understand our limitations.

The United States is only a fraction the size and contains

only a fraction of the population of Asia. We should not

assume too much about how far we can influence Asian

politics or how fully we can grasp the intricacies of the social

and political systems of China and its neighbors.

2. Prepare for Multiple Contingencies! We cannot know

what will happen. While we can learn much from

international relations theory and from history, we cannot

predict the future.

15
3. Remember Linkage! We cannot afford to concentrate

on bilateral relations with China. We must always consider

this nation in the broader Asian context and consider how

our policies will be received throughout the region.

4. Cornered Tigers Leap! China is fundamentally

insecure and has an inflated sense of American power. The

Chinese have concerns and worries at home and are under

pressure from the international community. Little good is

likely to come from provoking the Chinese or heightening

their sense of unease.

CONCLUSION

So what are the security implications of the rise of

China? The answers are far from certain. We are not sure

whether Chinese economic and military power will continue

to grow in the future. Nor are we sure whether a “rising”

China will be a greater threat to world stability than a

“declining” China. We are faced by considerable analytical

challenges when trying to measure the Chinese threat. We

must deal with the problems inherent to the task such as the

need to overcome prejudice and the difficulty of determining

intentions. We must also contend with the huge size and

complexity of Asia, the problems of understanding a

civilization very different from our own, and a regime that

discourages the free flow of information.

Despite these uncertainties, conference participants did

achieve some consensus. Two years ago, Paul Bracken, a

political scientist at Yale, warned that the power balance of

the world has changed. Asian countries (including China)

have embraced modern military technology (including

nuclear, biological, and chemical weapons) and may well

attempt to use them. No one at the conference seemed to

share Dr. Bracken’s profound sense of alarm.7 Almost all

conceded that China has done many constructive things in

the last few decades and has made substantial

contributions to international security. There was wide

agreement that China is seen in a positive light by most of

16
its neighbors and that China does not represent a direct

security threat to the United States.

At the same time, no one denied that challenges remain.

China is still dominated by a repressive regime whose

values are at odds with our own. It has a blind spot in regard

to Taiwan, where it has shown little or no ability to

compromise. Consequently, a confrontation with the United

States over the fate of this island, remains a dangerous

possibility. To some degree, at least, China’s ambitions are

in conflict with our own. The Asian nation would like to

reduce our global influence and is, increasingly, our

economic competitor. There are, moreover, inconsistencies

in China’s current behavior which, combined with its past

track record, make one hesitate to speak too confidently of

its future intentions.

In the final analysis, China remains something of an

enigma. Its ambiguous intentions, combined with its very

real capabilities, make it a threat that should not be

ignored. This does not mean, however, that we should

exaggerate the “Yellow Peril.” Precisely, because there are

some very serious issues at stake, the United States must

take care to be cautious, to consider Chinese vulnerabilities,

and to make thoughtful policy decisions.

ENDNOTES - CHAPTER 1

1. See, for example, David Shambaugh, Greater China: The Next

Superpower, Oxford: Oxford University Press, 1995.

2. This definition of threat is to be found in a variety of works on

threat analysis and glossaries of military and intelligence terms.

3. Sumit Ganguly, following William Blake.

4. Michael Howard, Lessons of History, New Haven, CT: Yale

University Press, 1992, p. 11. See also Warren I. Cohen, East Asia at the

Center: Four Thousand Years of Engagement with the World, New York:

Columbia University Press, 2000, p. 478.

17
5. Confucian thinkers stressed that warfare was a righteous

activity, to be undertaken only to ensure self-preservation or to get rid of

evil. Sun Pin: Military Method, with introduction and commentary by

Ralph D. Sawyer, trans., Boulder, CO: Westview Press, 1995, p. 189.

6. This does appear to be changing, as Kurt Campbell and others

noted.

7. Paul Bracken, Fire in the East: The Rise of Asian Military Power

and the Second Nuclear Age, New York: Harper Collins Publishers,

1999.

18
Part I.

GREAT POWER TRANSITIONS

19
CHAPTER 2

CHINA AND AMERICA IN THE NEW WORLD

POLITY

Joseph Grieco

INTRODUCTION

China is likely to be the great American foreign policy

problem of the 21st century. The evidence suggests that

China will probably be powerful enough to challenge

America’s preferred order in Asia and may, indeed, wish to

do so. One of the interesting paradoxes of the time is that

China, which has benefited from the Post-Cold War

international system, appears, nonetheless, to be

increasingly dissatisfied with the current world order.

Indeed, it appears to be so deeply disenchanted with the

East Asian political-territorial order that it might use force

to alter it. Why might this be so? And how should the United

States react to growing Chinese power and growing Chinese

dissatisfaction?

The discussion that follows is divided into three parts.

The first part presents evidence in support of the view that

China is indeed a major winner in recent world affairs but is

dissatisfied with the contemporary international (or, more

precisely, the East Asian regional) status quo. The second

part seeks to understand more fully why China is

dissatisfied with contemporary world circumstances. Using

a variety of international relations theories, it compares the

foreign policy orientation of three major winners in recent

world politics: China, Japan, and Germany. China’s global

orientation becomes clearer when seen in this comparative

light.

21
The third part focuses on American policy towards

China. It asks what America should do in response to the

rise of China. America has had a long-standing and

continuing strategy of engagement towards this country.

However, the impact of that strategy is not altogether clear.

Is it likely to produce a China that is more powerful, but also

more democratic, more pacific, and more accepting of the

international and regional status quo? Or will it result in a

China that is more powerful and committed to revising the

international status quo, through force if necessary? Is this

policy of engagement constructive? In particular, what are

the kinds of research questions that scholars of domestic

and international relations should be asking, if they are to

shed light on this issue?

I. THE PROBLEM

Chinese Economic Success, Chinese Political

Dissatisfaction.

China has been a major winner in the contemporary

world system. With the collapse of the Soviet Union, China

has found itself in a highly favorable security environment.

For the first time in modern Chinese history, no major state

has the intention or capability of undertaking significant

aggressive military operations against it.1 Perhaps even

more important than this is the fact that China has become

one of the great economic growth machines of recent times.

From the mid-1980s through the mid-1990s, for example, its

real gross domestic product per capita grew at a rate of 6.9

percent per year, a growth experience exceeded by only two

other countries during the same period: Thailand and the

Republic of Korea.

China’s overall growth remained robust even in the face

of the terrible economic crisis that swept through East and

Southeast Asia and other emerging markets during 1997

and 1998: its annual rate of growth in gross national

product from 1997 through 1999, according to the World

Bank, was about 7.9 percent per year. By 1999, China had

22
the seventh largest economy in the world, surpassed only by

the United States, Japan, Germany, France, the United

Kingdom, and Italy.2 The Chinese population has enjoyed a

spectacular improvement in its standard of living since the

end of the 1970’s, that is, since China began to integrate

with the world economy. As the World Bank noted:

Over the past 20 years, China achieved both an extraordinary

decline in poverty and high levels of education and health status. In

1978, China was among the world’s poorest countries, with 80

percent of the population having incomes of less than U.S.$1 a day

and only a third of all adults able to read or write. By 1998, the

proportion of the population with incomes less than U.S.$1 a day

had declined to about 12 percent, life expectancy was an enviable

70 years, and illiteracy among 15 to 25 year-olds was about 7

percent.3

Indeed, sources such as the Central Intelligence Agency

(CIA) and the World Bank, which based their estimates on

purchasing power parity estimates, projected that by the

year 2020 China might have the largest economy in the

world. Such projections appeared still to be credible at the

end of the 1990s.4

China’s recent economic success can be traced to the

structural reforms it undertook in the late-1970s. These

reforms brought about the development of freer markets

and substantial levels of privatization of national economic

activity. The more purely domestic elements of the reform

program have undoubtedly played a key role in China’s

economic transformation. However, other factors were at

work, too. Chief among these was China’s decision to open

its economy in large measure to the world. This resulted in

increasingly beneficial economic relations during the 1980s

and 1990s. A lively trade developed between China and its

East Asian neighbors, the countries of Western Europe, and

especially the United States. Between 1989 and 1999, for

example, China’s exports grew from about $53 billion to

about $163 billion (and that excludes exports from Hong

Kong. As a result, by the end of the 1990s China had become

the world’s ninth-largest exporter.5 China’s trade with the

23
United States has been particularly fruitful. By 1999,

according to Chinese figures provided to the International

Monetary Fund, China enjoyed a trade surplus with the

United States in the range of $22 billion.6

The figures above suggest that, while it is just now

joining the World Trade Organization (WTO), China has

been in recent years one of the biggest beneficiaries of the

opportunities for trade that are provided by that regime.

China has also been a major beneficiary of the international

regimes for money and finance, the International Monetary

Fund and the World Bank. It is a member of both

organizations. Moreover, as of June 2000, it was the

second-largest recipient of total World Bank loans made

since the Bank had begun lending activities in the

late-1940s. It was also the single largest recipient of

outstanding or approved World Bank loans.7

Given its tremendously successful economic

performance, and the important link between that superb

performance and its external economic relations, one might

expect that China would be essentially satisfied with the

contemporary East Asian and international orders. One

might also expect that China would want to do everything it

could to ensure continued participation in the international

political economy so as to maximize its prospects for future

growth and even greater medium-term stature in world

affairs. And yet, in recent years, China has shown

unmistakable signs that it is dissatisfied with

contemporary arrangements in East Asia, and is pursuing a

foreign policy toward the region that has revisionist

elements.

It now appears as if China would be willing to risk its

favorable global economic and political relationships if this

would result in an improved position in East Asia.8 There is

some telling evidence of this. In particular, China is putting

an increasing emphasis on the use of military instruments

both in the region and, through arms sales, in other parts of

the world. For example, China has threatened repeatedly in

24
recent years to use force to prevent the independence of

Taiwan. It did so most dramatically, in 1996, at the time of

the first democratic presidential elections in Taiwan. China

believed that Taiwan was making a concerted effort to move

closer to separation from China. In an effort to forestall this

development, China tested missiles and engaged in military

exercises close to the island. It did so to make credible its

warnings that it would prevent Taiwanese independence,

by force if needed. It did so, moreover, despite being warned

by the United States not to do so, and even as the United

States dispatched two aircraft carrier groups to the region.9

In addition, China has laid claim to the potentially

oil-rich Spratly Islands region and indeed a large portion of

the South China Sea, and has applied low levels of force in

support of those claims.10 Moreover, China has sold nuclear

weapons related technology and nuclear-capable missiles to

Pakistan, and has come close to major sales of nuclear

technology to Iran.11

Chinese military capabilities still lag far behind those of

the United States. Indeed, the information revolution in

modern warfare may cause the gap to widen in favor of the

United States. In addition, recent careful analyses suggest

that now, and for the foreseeable future, China will lack the

ability to project sufficient military force to compel Taiwan

to accept control from the mainland, or to acquire the

Spratly Islands.12

Yet, in recent years, China has increased its allocation of

national resources to the acquisition of military

capabilities. According to the International Institute for

Strategic Studies (IISS), for example, Chinese military

expenditures, adjusted by International Monetary Fund

(IMF) and World Bank estimates of purchasing power

parities, may have increased by roughly 40 percent between

1990 and 1995.13 Finally, as Alastair Johnston has recently

demonstrated, China appears to be developing a

warfighting, as opposed to a deterrence-oriented, nuclear

weapons doctrine.14

25
These actions suggest that, at a minimum, China wants

to make it clear that it is a major power in Asia. Evidence

also suggests that China may want to bring about a

significant change in the political, and perhaps even the

territorial status quo in that part of the world. Finally,

judging by its actions in Taiwan and, still more ominously,

in the South China Sea area, China may be willing to use

military force to so effect adjustments in the region.15

If this assessment is correct, then it marks a significant

change in Chinese orientation. From the late 1970s through

the 1980s China appeared to be following a rather different

track. During this period China reformed its domestic

economy and opened to the world economy. It seemed to be

interested in constructing relationships in Asia and with

the United States that emphasized mutually profitable

economic exchange. It seemingly had decided to shift away

from the kind of tough, territorially-aggressive foreign

policy that it had pursued in the 1950s (the Korean war), the

1960s (the war with India), and the 1970s (the war with

Vietnam). In sum, using terms suggested by Richard

Rosecrance, China showed signs of becoming less of a

“territorial state” and more of a “trading state.”16

It should be emphasized that not all of China’s recent

behavior should necessarily be coded as representing a new

interest in national territorial expansion and control. In

particular, in the case of Taiwan, the mainland Chinese

may not have been initiating a new effort to retake the

island. They may well have merely been reacting to efforts

by the Taiwanese government to gain new international

acceptance. Chinese actions in the Spratlys, however,

remain troubling. In this case, China is clearly seeking to

establish new facts in East Asia. It is trying to attain a new

level of formal, legal control over the area. This type of

control would not serve much purpose if the Chinese ended

up having to use force to take the Spratlys and became

embroiled in conflict with other states in the region and

even the United States. If this occurred, the Chinese would

be unable to exploit the potential oil resources in the area.

26
Yet, this is the risk that China appears increasingly willing

to run. It does look as if China now favors formal territorial

ownership, or at least hegemony, even if this means the

enjoyment of fewer economic benefits from such

ownership.17

If this is true, and China is indeed dissatisfied with the

way things are, then we need to address three key

questions:

1. Why have top Chinese decisionmakers decided to shift

China’s orientation? Why, that is, has China, which was

seemingly developing into a trading state gone back to

behaving more like a traditional territorial state?

2. Why have Chinese leaders apparently come to find

intolerable precisely the international framework in which

China has been doing so well for the past 10-15 years?18

3. If Chinese leaders are dissatisfied with the

contemporary international/regional status quo, why do

they believe they must act assertively in the near term?

With time, and given China’s projected rate of future

growth, China could become progressively and steadily the

hegemon of the region and bring about gradual changes in

the regional political status quo. This, in turn, would ensure

that the status quo would be more in line with China’s

interests.19 Why do they not wait?

Once again, we ought perhaps to distinguish between

recent Chinese foreign policy in regard to Taiwan and the

South China Sea. To the extent that Chinese leaders believe

that it is Taiwan that is seeking to change the regional

status quo by its efforts to acquire greater acceptance in the

international community, then their behavior may be seen

as reactive rather than assertive.

In contrast, China in recent years seems to have been

taking the initiative in the South China Sea. At any rate, it

does appear to be trying to create a new level of Chinese

control/sovereignty over the area. It is precisely China’s

interest in establishing such control, and its willingness to

27
use force to do so, which may be indicative of a change in

direction. China, in other words, which appears to have

been moving in the direction of becoming more of a trading

state, now seems to be reviving its territorial goals and

seems to be willing to back those goals using traditional

instruments of power.

II. PROBLEMS WITH CURRENT EXPLANATIONS

FOR THE CHINA PUZZLE, AND POSSIBLE WAYS

FORWARD

A number of possible answers have been given to the

questions posited above. However, differences between

Chinese national strategy since the end of the Cold War and

those of Germany and Japan, as well as (less pronounced)

differences between German and Japanese national

strategies, cast doubt on their validity. German and

Japanese foreign policy would appear to have the following

key characteristics in recent years.

Germany has responded to the end of the Cold War with

a strategy that has made it look more and more like a

Rosecrancian trading state. Most important, Germany has

markedly reduced its allocation of national resources to

military power. For example, German spending on defense

decreased from about $46 billion in 1985 (using constant

1993 prices) to $34.8 billion in 1994, and total armed forces

have been cut from 478,000 persons in 1985 to 367,000 in

1994.20 At the same time, Germany has been a principal

force (together with France) in European efforts to build

stronger regional institutions. These recent efforts include

reinvigorating the Western European Union (WEU)

military arrangement and, under the auspices of the

European Union (EU), the drives toward Economic and

Monetary Union (EMU) and a European Common Foreign

and Security Policy (CFSP).

Japan during the Cold War was perhaps more of a

trading state than was Germany, and it was vastly less

oriented to territorial state goals and instruments than was

28
China. However—and this is very interesting—Japan has

responded to the end of the Cold War by undertaking a shift

along the trading state-territorial state continuum. But

while Germany has moved more and more in the direction of

becoming a trading-state, the same is not true of Japan.

This Asian country has made a shift that is similar in

direction, though not in magnitude, to that of China. As a

result, it currently occupies a different point on the

continuum from that occupied by its large neighbors.

On the one hand, Japan has not responded to the end of

the Cold War by becoming more assertive or bellicose in

Asian regional politics. It has not, for example, sought to

attain unilateral control of Asian sea lanes or ocean

resources as has been true of China. At the same time, and

in contrast to Germany, Japan has markedly increased its

defense spending in recent years. It is the case that

Germany still devotes a larger percentage of its gross

domestic product (GDP) to defense (2.0 percent in 1994)

than does Japan (1 percent), but in terms of absolute

resource allocations Japan has been able to take advantage

of its progressively larger economy to spend more on defense

while still staying at the domestically and regionally

important 1 percent GDP limit. The result has been that

while German, British, and French military expenditures

(again, in 1993 constant dollars) exceeded that of Japan in

1985, Japanese expenditures exceeded those of all three

countries by 1993-1994.21Finally, Germany has worked

very hard to assure its neighbors that it remains firmly and

indeed increasingly committed to regional cooperation, and

is willing to reinforce that commitment through concrete

institutional initiatives. In comparison, Japan has been

highly reluctant to accept numerous invitations from

Malaysia to help establish a uniquely East Asian regional

economic arrangement, and has played a marginal role in

the only multilateral security arrangement in the area, the

Association of Southeast Asian Nations (ASEAN) Regional

Forum (ARF).

29
Keeping in mind these broad-brush characterizations of

German and Japanese post-Cold War national strategies,

let us now identify and evaluate four possible explanations

for why China has apparently returned to territorialism in

world affairs.

1. China has grown in economic power. It thus now has

both an interest in changing the East Asian order, and an

enhanced base with which to achieve its goals.22

Although it is correct that China has greater relative

national economic capabilities today than 10 or 15 years

ago, this is also true of Germany in Europe and Japan in

East Asia. Yet, Germany is not seeking to convert its

economic strengths into military capabilities; Japan has not

started to do so to the same degree as China; and neither

Germany nor Japan is seeking to bring about major changes

in the status quo of their respective regions.23 Economic

change, in short, may be viewed as a necessary but not a

sufficient cause for the emergence of a “challenger state,”

that is, for a state able and prepared to use force to alter the

status quo. In other words, a major change in relative

economic capabilities within a region or within the

international system as a whole may be a necessary

condition for the rise of a challenger state. An economic

change of this sort does not, however, inevitably lead to such

a development.

2. A state can best attain security by maximizing its

national military power and its control over external

sources of important resources.24

According to this theory, China, newly empowered with

a growing economy, is acting like a normal, security and

power-maximizing state. This is a useful argument.

However, the examples of Japan and Germany suggest its

limitations. Since the end of the Cold War, Germany has

experienced an increase in power. Nonetheless, it has

avoided efforts to increase its political-military power or

territorial control. Japan represents a more difficult case:

for several decades after World War II, it declined to convert

30
its growing economic capabilities into a commensurate level

of military power. However in recent years it has enhanced

its political-military capabilities quite substantially. At the

same time, Japan has given no signs in recent years of

wishing to make territorial changes or overturn the Asian

regional order.

3. China is acting more assertively because of fear of a

resurgent Russia and the possibility of tensions on its

borders with that country.

Russia does not obviously look like a resurgent country.

From the mid-to-late 1990s to this very day, Russia has been

very much preoccupied by its own problems. It faces failed

attempts at economic reform at home and the utter collapse

of its power position in Europe (symbolized by the expansion

of the North Atlantic Treaty Organization (NATO) to

Poland, Hungary, and the Czech Republic). It is also

engaged in arguments with the former Soviet republics

about the disposition of assets and other matters related to

the dissolution of the former Union of Soviet Socialist

Republics (USSR).25 However, China may be concerned that

present-day Russia will become an adversary at some point

in the future. The USSR certainly was an opponent from the

1960s until well into the 1980s. China may, therefore, be

enhancing its capabilities and political status in the world

in order to meet that potential challenge.

The problem with this argument is that we can point to

another state—Germany—which has reason to be afraid of

Russia. Yet Germany has not responded with increases in

military power or greater assertiveness in world affairs.

Instead it has followed a policy of accommodation towards

Russia. Moreover, Chinese actions since the end of the Cold

War have not brought it into conflict with Russia. To the

contrary, China has sought to improve relations with

Russia and to resolve some of its long-standing border

problems with the country. It has also sought to coordinate

policy in some measure against the United States on the key

question of America’s interest in National Missile Defense

31
(NMD) and United Nations (U.N.) sanctions against Iraq. It

certainly has come into more frequent disagreement and

conflict with the (more distant) United States than it has

with its Russian neighbor.

4. China has a cartelized authoritarian political regime,

and such regimes are highly likely to become more bellicose

militarily as they attain greater economic power and face

increasing domestic demands for political reform.26

This is a strong proposition, and is buttressed by the

contrast between China and Germany since 1989. However,

rising autocratic states are not unconditionally aggressive.

Bismarck’s Germany offers a very interesting example here.

After its success against France in 1870, Germany had a

very fast growing economy with a very conservative foreign

policy. In addition, as is moderately suggested by recent

changes in Japanese national policy, modern democracies

may also shift away (at least slightly) from a trading-state

orientation and toward a territorial, military

power-conscious orientation.

Clearly, domestic political variations must be taken into

account if we are to explain why economic growth has not led

to the development of similar national strategies in China,

Japan, and Germany. The recent work of such scholars as

Jack Snyder and Charles Kupchan offers a partial

explanation for why China has returned to a territorialist

foreign policy. However, if we are also to understand the

differences between the Japanese and German national

strategies we would do well to look beyond the domestic

arguments.

Both China and even to some degree Japan (the latter in

terms of enhancing its military power) appear to be shifting

their orientation away from a trading state strategy and

toward a more traditional territorial approach to neighbors,

while Germany appears to be becoming even more of a

trading state. If they really are shifting directions in this

manner, we must ask whether there are fundamentally

different regional-level (as opposed to either domestic or

32
global) forces at work today in Asia and in Europe

contributing to this differentiation in behavior. These forces

in East Asia may be pushing China to move toward a return

to territorial-state behavior, and, furthermore, may even be

causing Japan, contrary to what we might expect, to make

some movement in that direction. At the same time, the

absence of such forces may be leading to a different

experience for Germany in post-Cold War Europe.27

At least two regional-level factors may explain the

differences between the strategies of China and Japan on

the one hand, and Germany on the other.

1. Regional-level turbulence in relative capabilities.

Even with the reunification of Germany, changes in overall

relative economic capabilities among the main Western

European countries have not changed dramatically since

1990; in contrast, there is a great deal of turbulence in

relative capabilities in East Asia.28 Because of this

turbulence, China may be having difficulty in calculating

the winners and losers, and the more influential and less

influential states, in post-Cold War Europe. The same may

be true of Japan, if the latter is basically increasing its

capabilities to offset the growing challenges from the

former. Germany and its neighbors, by contrast, may not be

having problems of this sort.

2. Social capital as a legacy of the Cold War. Kahler’s

argument offers us an alternative explanation for what is

happening. He suggests that the countries of Western

Europe enjoy greater institutional density and, thanks to

this, more favorable endowments of transnational “social

capital,” than do the countries of East Asia. A different

degree of regional social capital—or mutual trust—might

help explain why China believes it must act in the near term

to translate its economic growth into a more favorable

territorial-diplomatic regional position. This, in turn, may

be provoking Japan to enhance its own military capabilities.

But why did the two regions develop such different levels of

social capital? At least one possible argument would be that

33
the difference in social capital reflects the different manner

in which the Cold War was conducted in the two regions.29

On the one hand, geopolitical realities of the Cold War in

Europe required the Western states to permit German

rearmament. However, in order to offset the risks of

German unilateralism the return of German power took

place early under the auspices of European and Atlantic

institutions. The Cold War, in a word, required

Franco-German reconciliation and the development of trust

between those two countries, and this set the stage and even

served as the motor for a wider institutionalization of state

relationships in Western Europe.

On the other hand, in East Asia the Soviet and Chinese

threat was met by an American network of bilateral defense

treaties. As a result, the countries in the region that

received American protection did not need to reconcile with

Japan. When China, for example, joined the American-led

coalition of Pacific-Rim states against the USSR in the

1970s, it entered into an informal entente with the United

States rather than a formal regional arrangement involving

other regional states. Thus, the Cold War induced

cooperation and reconciliation in Western Europe, and set

the stage for the formation of institutions and social capital

able to withstand the shocks of 1989-90. In contrast, it left

Asia without either a habit of institutionalized cooperation

or a reservoir of mutual trust able to contain or channel

growing Chinese power.

III. WHAT SHOULD AMERICA DO?

Whatever the causes of China’s apparent political

dissatisfaction with the international status quo, unless

circumstances in that country change dramatically, the

likelihood is that China will continue to grow in economic

and military power. This given, the United States must

devise a response to that growing power. The United States

during the past decade (and, it may be suggested, in

differing degrees and under different guises, since the

34
opening to China by President Nixon in 1971) has pursued a

two-pronged strategy toward China. On the one hand, the

United States has sought to engage China. On the other

hand, it has purchased insurance against a revisionist

China by strengthening its alliance ties in East Asia.

The more interesting and controversial of the two

elements of the American strategy toward China has surely

been the idea of engaging China. Engagement, in rough

terms, is a strategy whereby the United States and its

partners seek (1) to establish robust commercial and

financial ties with China; and (2) to draw that country into a

variety of regional and global economic, political, and

institutional arrangements.

The rationale behind these efforts is that they may bring

about a China that will be more accepting of the

contemporary international order and more committed to

bringing about changes in it through peaceful means. These

changes may come about through a variety of mechanisms.

• Engagement may generate observable benefits for

China (mainly economic) and thereby create in the

minds of Chinese leaders a stake in the international

status quo;

• Engagement may instill in Chinese officials a

stronger awareness of the value of international

norms and practices associated with the

contemporary world order;

• Engagement may encourage in Chinese officials the

belief that they are participating in and helping to

construct that world order; and

• Most ambitiously, engagement might prompt

economic modernization in China and, in so doing,

unleash social change in that country. This social

change would be of the sort to push it gradually

35
toward greater pluralism and, ultimately, lead to

greater domestic calls for democratic political change.

During the 1990s, the Clinton administration engaged

in many extensive discussions of the meaning and possible

benefits of engagement of China, but the new Bush

administration appears to be every bit as committed as to

the strategy. For example, in the statement he presented to

the Senate as a part of his confirmation hearings, Secretary

of State-Designate Colin Powell noted that:

We will treat China as she merits. A strategic partner China

is not, but neither is China our inevitable and implacable

foe. China is a competitor, a potential regional rival, but also

a trading partner willing to cooperate in areas where our

strategic interests overlap. China is all of these things, but

China is not an enemy, and our challenge is to keep it that

way by enmeshing them in the rule of law, by exposing them

to the powerful forces of a free enterprise system in

democracy, so they can see that this is the proper direction

in which to move.30

Here, in a nutshell, is the engagement project: to bring

the Chinese into the system of international law and

international capitalism, and, by so doing, to propel them,

slowly or quickly, toward a future of free enterprise and

democracy.

The problem with this strategy is that, while there is less

than a 100 percent probability that it will succeed in

bringing about a more peaceful and responsible and even

more democratic China in the years ahead, there is

something approaching a 100 percent likelihood that such

engagement will produce a more potent China. Economic

engagement with China has essentially meant that this

Asian nation has exported low-technology goods which have

only the most indirect impact on the military capabilities of

its trading partners. In exchange, China has been able to

shop around the world for goods, such as complex

electronics, powerful computers, and sophisticated machine

tools, that clearly add to its own military power. China has

clearly enjoyed what Albert Hirschman termed the “supply

36
effect” that comes from economic integration: that it, China

has enjoyed access to external supplies of goods and services

that materially enhances its national power.

Hirschman, however, also spoke of an “influence effect.”

The theory here is that a country which enjoys the benefits

of trade will become reluctant to put that trade in jeopardy

by antagonizing its trading partners. Applied to the case we

are considering here, this should mean that China, once

engaged in prosperous trade with America and its other

partners, will not want to put these benefits at risk, thereby

giving these nations the ability to exert an influence on it.

However, it remains to be seen whether China’s economic

involvement with such partners as America will generate a

high level of this “influence effect.”

Given the strong commitment by the United States to

seek to pacify and to transform China through economic and

political engagement, an important task for students of

international politics might be to identify the conditions

under which such a strategy is more or less likely to succeed.

Some of the questions that might be usefully pursued in this

context might include the following.

1. Does economic integration of a country with one or a

number of trading partners lessen the risk of military

conflict between that country and its new trading partner or

partners?

In the near term, the United States hopes that the fear

of losing the benefits of economic integration will decrease

the attractiveness and thus the incidence of the use by

China of military force in world affairs. Recent systematic

studies have revisited and reinvigorated the arguments put

forward in the past by such writers as Adam Smith and

Immanuel Kant and, in more recent times, Norman Angell.

They reached the conclusion that increases in the level of

international economic interdependence between countries

(measured, for example, by the amount of each country’s

exports to its partner relative to GDP) may indeed reduce

37
the likelihood of military conflict between those two

nations.31

And yet, a very different perspective suggests that

increases in international economic interdependence, by

increasing the points of contact between countries and

therefore the risk of potential disagreements between

nations, may contribute to the risk that conflicts might

develop between countries.32 A third argument is that the

effects of economic interdependence are contingent on the

presence or absence of other conditions. For example,

economic interdependence may mitigate conflict between a

pair of countries if each of the countries believes that its

partner will retain economic openness in the future, or if

both partners are democratic states.33 Given the centrality

of the interdependence-peace link in America’s engagement

strategy toward China, further investigation into these

links would be invaluable.

2. A key goal of the United States is to use engagement to

enrich China and thereby to instill satisfaction in the

Chinese elite when it comes to the international status quo.

On what theoretical and empirical grounds should we

expect this to happen?

Power-transition theory, as we have seen, suggests that

a country that becomes wealthier and hence more capable

might become dissatisfied and more aggressive in foreign

affairs. Yet, power transitions have occurred between

countries without military conflict, suggesting that there

may be circumstances in which a growth in power need not

translate into enhanced foreign truculence.

3. Will Chinese economic growth produce Chinese

democracy?

The literature on the democratic peace finds that

democracies are markedly unlikely to fight one another. In

light of this, it is understandable that the U.S. ultimate goal

is to employ engagement as a mechanism to democratize

China: it would, perhaps, serve as the solution to growing

38
Chinese power in the 21st century. Both theory and

systematic empirical analyses, provide grounds for hope. As

a matter of probabilities, a wealthier, more economically

advanced and sophisticated China is also more likely to

become democratic than an underdeveloped China. Here we

may turn to modernization theory. This is the line of inquiry

initiated by the trailblazing work of Seymour Martin Lipset

in the late-1950s, and summarized most effectively as of the

late-1990s by constructive critics of the theory, Adam

Przeworski and Fernando Limongi. This theory suggests

that economic growth may produce political democracy by

way of a variety of channels:

• Economic growth produces social complexity, and

such complexity defies centralized control;

• Economic growth brings into being middle and

professional classes, classes that demand a voice in

government as a way of ensuring their economic and

political rights;

• These middle and professional classes may establish

political ties with the working-class, and together

press for liberalization and ultimately democracy;

• Economic growth contributes to urbanization and to a

widening of educational opportunities throughout

society, and both of these conditions add to societal

complexity and to the pool of individuals who are

interested in and capable of working within

democratic institutions.34

Almost every one of these propositions can be found in

one or another speech about the engagement of China that

was given by Clinton administration officials during the

1990s. They will in all likelihood appear in comparable

speeches by members of the Bush administration, as

illustrated above in the statement by Powell.

39
And yet, systematic analyses suggest that while

increased economic growth enhances the probability of

democracy, it does not by any means guarantee its fruition.

Indeed, as Przeworski and Limongi suggest, the probability

is quite high that after reaching a moderately advanced

level of economic development, authoritarian regimes will

remain in power.

Also noteworthy are the sobering statistical findings of

Robert Barro. He modeled the attainment of democracy

from the 1970s to the 1990s in a large sample of countries.

He found that China’s actual level of democracy (based on a

composite of measures) in 1994 was about one-half the level

that would be predicted on the basis of a statistical model

that placed great weight on improvements in the economy

and society.35 Indeed, on the basis of modernization theory,

one might have expected that China since the late-1970s

would have made very substantial progress toward

democracy.

• As noted above, since 1978 China has had one of the

fastest growing economies in the world, and the

associated development of a growing

middle/professional class, improved education, and

urbanization.

• China has radically expanded its contacts with the

world through trade and foreign investment,

suggesting that its people have come into contact with

foreign political ideas and institutions.

• China’s social-cultural contact with the outside world

has increased. Among other things, it has trained

thousands of young people in foreign universities.

Yet, at least to date, there has not been a strong

movement toward national democracy and civil rights and

liberties in China. Finally, to the extent that we do observe

democratization in China, this democratization is taking

place in the countryside, in the areas least connected to the

40
outside world and where there have been the least dramatic

advances in terms of economic growth and modernization.

In sum, given that the U.S. ultimate goal is to use

economic (and institutional) engagement of China today as

a way of undermining the Chinese regime and its

replacement by a democratic order tomorrow, a number of

questions about the growth-democracy nexus would appear

to cry out for attention.

1. How might authoritarian leaders short-circuit the

pathways that, according to modernization theory, lead

from economic growth to democratization?36

2. Under what conditions might economic growth

actually increase the control capacities of authoritarian

leaders?

3. Under what conditions might economic growth lead,

not to the replacement of an authoritarian regime by a

democratic regime, but instead by another authoritarian

regime?

CONCLUSION

U.S.-Chinese relations have modestly improved during

1997 and 1998. Indications of this include an exchange of

state visits between President William Clinton and

President Jiang Zemin, the quieting of Chinese-Taiwanese

relations, the smooth take-over of Hong Kong by the

mainland, and China’s forbearance in the midst of the

financial crises of 1997-98. All this might yield the

conclusion that fears expressed earlier in the decade about

China were misplaced or overdrawn.

Yet, at least two of China’s core concerns were not yet

resolved as we entered the new century: Taiwan was still a

separate entity that showed signs of a desire for

independence, and ownership of the Spratly Islands was

still an open matter. These two political problems are likely

to engender regional tensions in the years ahead; one or

41
another might even be the basis for a full-fledged

political-military crisis involving China and the United

States. Given that China showed that it could weather the

sort of economic turbulence that brought down a number of

East Asia tigers during the last years of the 1990s, it

remains likely that China will continue to become an

economic powerhouse during the next 20 years. Thus, there

is a good chance that we will continue to be faced with the

combination of growing Chinese capabilities and growing

Chinese ambition in regard to Taiwan and the Spratlys.

Ironically, the peace and victory achieved by America in

1989 have left us a problematic legacy. What will China do

with its growing power? What does it want from the

international system? What can the United States and its

allies do to smooth the way for China as it grows into its new

status in world politics? Should the United States engage

China, and thereby facilitate the growth of its power, but

also perhaps shape the ends toward which that power would

be available in a manner that would be more accepting of the

contemporary American-centered world order? These are

likely to be among the troubling questions that we will need

to address in the years ahead.

ENDNOTES - CHAPTER 2

1. On this point, see Jing-dong Yuan, “Threat Perception and

Chinese Security Policy After the Cold War,” Pacific Focus, Vol. 13,

Spring 1998, p. 62.

2. See World Bank, Quick Reference Tables, table on gross domestic

product using the World Bank Atlas method of calculation, at

http://www.worldbank.org/data/databytopic/GNP.pdf.

3. See World Bank, “The World Bank and China,” at

http://wbln0018.worldbank.org/eap/eap.nsf/a71f97484cde72508525

67c900767289/6049af06c4b92427852567d1006bf6f1?OpenDocument.

4. See Richard Halloran, “The Rising East,” Foreign Policy, No. 102,

Spring 1996, p. 11. Joseph Nye correctly points out that it is important

to be cautious in making straight-line projections about China’s future

economic status, but even with such caution there are strong grounds to

42
believe that China will be a major economic center over the next twenty

years: see Joseph Nye, “China’s Re-emergence and the Future of the

Asia-Pacific,” Survival, Vol. 39, Winter 1997-98, pp. 66-68. For analyses

of China’s economic challenges regarding both domestic economic

restructuring (in particular, in dismantling what is still a very large and

inefficient state-owned industrial sector) and external financial

linkages, see Neil C. Hughes, “Smashing the Iron Rice Bowl,” Foreign

Affairs, Vol. 77, July/August, 1998, pp. 67-77; and Nicholas R. Lardy,

“China and the Asian Contagion,” Foreign Affairs, Vol. 77, July/August

1998, pp. 78-88.

5. See International Monetary Fund, Direction of Trade Yearbook:

1996, Washington, 1996, pp. 3-5; and Direction of Trade Yearbook: 2000,

pp. 2-10.

6. It should be noted that the bilateral trade figures provided by both

states to the International Monetary Fund differ dramatically as a

result of the manner in which each country then treated trade that

transited through Hong Kong: as noted in the text, according to China,

for example, it enjoyed a merchandise trade surplus in 1994 with the

United States in the amount of about $7.4 billion; according to the

United States, that figure was about $32.0 billion.

7. For figures on cumulative loans to different countries by the

World Bank, see World Bank, Annual Report: 2000, Appendix 13,

available at http://www.worldbank.org/html/extpb/annrep/

pdf/appndx/wb_a13.pdf. The World Bank notes in that report that it

had disbursed from the commencement of its operations in the late

1940s through June 2000 a total of about $470 billion; India was the

single largest recipient of such loans (a total of $54 billion); China was

the second largest recipient (at $34.7 billion). As of June 2000, total

World Bank loans outstanding or approved but not yet disbursed totaled

about $169 billion. Of this total, $19.8 billion were committed or already

disbursed to China, or 12 percent of the total, while $14.4 billion, or 9

percent, were similarly directed toward the second largest recipient,

Indonesia. For these figures, see World Bank, Annual Report: 2000,

available at http://www.worldbank.org/html/extpb/annrep/pdf/

ibrd_fin.pdf.

8. For a very helpful discussion of the concept of state revisionism in

world politics, see Randall L. Schweller, Deadly Imbalances: Tripolarity

and Hitler’s Strategy of World Conquest, New York: Columbia

University Press, 1998.

9. For a chilling account of the events leading up to and surrounding

the Chinese-American crisis of March 1996, see Robert S. Ross, “The

43
1995-96 Taiwan Strait Confrontation: Coercion, Credibility, and the

Use of Force,” International Security, Vol. 25, No. 2, Fall 2000, pp.

87-123.

10. For helpful discussions of the Spratly Islands/South China Sea

dispute, see Gerald Segal, “East Asia and the ”Constrainment" of

China," International Security, Vol. 20, Spring 1996, especially pp.

116-123; and Michael G. Gallagher, “China’s Illusory Threat to the

South China Sea,” International Security, Vol. 19, No. 1, Summer 1994,

pp. 169-184.

11. For a helpful overview of China’s proliferation activities and

diplomacy in respect to nuclear weapons and delivery systems, see J.

Mohan Malik, “China and the Nuclear Non-Proliferation Regime,

Contemporary Southeast Asia, December 22, 2000, and available

through Expanded Academic ASAP; and Robert S. Ross, “China,” in

Economic Sanctions and American Diplomacy, Richard N. Haass, ed.,

New York: Council on Foreign Relations, 1998, pp. 21-28. It should be

noted that Ross argues that China became more cautious about making

arms sales to Middle Eastern countries after 1988.

12. See Robert S. Ross, “Beijing as a Conservative Power,” Foreign

Affairs, Vol. 76, March-April 1997, pp. 35-38; Nye, “China’s

Re-emergence,” pp. 68-70; Avery Goldstein, “Great Expectations:

Interpreting China’s Arrival,” International Security, Vol. 22, Winter

1997/98, especially pp. 42-54; and Michael O’Hanlon, “Why China

Cannot Conquer Taiwan,” International Security, Vol. 25, No. 2, Fall

2000, pp. 51-86.

13. See International Institute for Strategic Studies, The Military

Balance: 1995/96, London: IISS, 1995, p. 271.

14. See Alastair Iain Johnston, “China’s New ”Old Thinking": The

Concept of Limited Deterrence," International Security, Vol. 20, Winter

1995/96, pp. 5-42.

15. For further discussion of the possibility that China’s policies

may be highly destabilizing in East Asia (especially if and as they evoke

a Japanese response involving a renationalization of its national

security policy), see Aaron L. Friedberg, “Ripe for Rivalry: Prospects for

Peace in a Multipolar Asia,” International Security, Vol. 18, No. 3,

Winter 1993/94, pp. 5-33; Richard K. Betts, “Wealth, Power, and

Instability: East Asia and the United States after the Cold War,”

International Security, Vol. 18, No. 3, Winter 1993/94, pp. 34-77; and

Barry Buzan and Gerald Segal, “Rethinking East Asian Security,”

Survival, Vol. 36, Summer 1994, pp. 3-21. For a critical assessment of

44
this line of analysis, see David Kang, “The Middle Road: Security and

Cooperation,” Asian Perspective, Vol. 19, Fall-Winter 1995, pp. 9-28. In

addition to the issues of Taiwan and the South China Sea, Thomas

Christensen points out that Japanese-Chinese relations have the

potential of becoming more conflictual in the future: see Christensen,

“China, the U.S.-Japanese Alliance, and the Security Dilemma in East

Asia,” International Security, Vol. 23, No. 4, Spring 199, pp. 49-80.

16. See Richard Rosecrance, The Rise of the Trading State:

Commerce and Conquest in the Modern World, New York: Basic Books,

1986.

17. Robert Ross, a close observer of China who finds that it is

generally pursuing a conservative, cautious national strategy, notes

that the exception to China’s overall caution is its assertive policy

regarding the Spratly Islands; see Ross, “Beijing as a Conservative

Power,” pp. 41-42.

18. That China is becoming disenchanted with the international

status quo in spite of gaining from it would appear to be in accord with

the power-transition thesis. On its argument that rising powers come to

find the existing international order unacceptable, and are willing to

use force to change it, see, for example, A. F. K. Organski and Jacek

Kugler, The War Ledger Chicago: University of Chicago Press, 1980,

especially p. 23; and Robert Gilpin, War and Change in World Politics,

Cambridge: Cambridge University Press, 1981, pp. 93, 186-210.

19. This question is prompted by Michael Gordon’s discussion of

Germany and Great Britain at the turn of the century. In terms of

projected power trajectories, Germany (clearly becoming Europe’s

economic hegemon) should have been confident and patient. By

contrast, Britain (clearly a relative declining power) should have easily

provoked, but in fact it was rather reticent to respond to German

pressure. See Michael R. Gordon, “Domestic Conflict and the Origins of

the First World War: the British and German Cases,” Journal of Modern

History, Vol. 46, June 1974, pp. 191-226. It is also informed by Jack

Levy’s discussion of the argument by Organski and Kugler that rising

challenger-states will display a tendency to use military force to topple

the then-hegemon and thereby bring about what for the rising state is a

more favorable international order. Levy asks about this posited

tendency: “Why should the challenger incur the risks of fighting while it

is still inferior? Why doesn’t it wait until existing trends in economic and

military power, which Organski and Kugler consider to be irreversible,

catapult it into the stronger position?” See Jack S. Levy, “Declining

Power and the Preventative Motivation for War,” World Politics, Vol.

40, October 1987, p. 84.

45
20. See International Institute for Strategic Studies, Military

Balance 1995/96, p. 264.

21. Ibid., p. 264; also see p. 172, at which the IISS reports that this

shift between Japan and the three European middle powers occurred in

1993, that it was reinforced by 1995 projected defense spending by the

major powers, and that “With the possible exception of Russia, Japan

now spends appreciably more on defense on any other country apart

from the U.S.”

22. This is a line of analysis that might follow the work by Gilpin,

War and Change, and by Organski and Kugler, War Ledger.

23. This is noted by Organski and Kugler, War Ledger, p. 51.

24. This view is put forward most effectively by John Mearsheimer

in “The False Promise of International Institutions,” International

Security, Vol. 19, No. 3, Winter 1994/95, p. 11; also see Fareed Zakaria,

“Realism and Domestic Politics: A Review Essay,” International

Security, Vol. 17, Summer 1992, pp. 190-96.

25. For overviews of Russia’s truncated status in world politics, and

its interactions with former Soviet republics, see Michael McFaul, “A

Precarious Peace: Domestic Politics in the Making of Russian Foreign

Policy,” International Security, Vol. 22, No. 3, Winter 1997/98, pp. 5-35;

and Daniel Drezner, “Allies, Adversaries, and Economic Coercion:

Russian Foreign Economic Policy Since 1991,” Security Studies, Vol. 6,

Spring 1997, pp. 65-111.

26. The argument linking domestic authoritarianism, and

specifically political cartelization, to external state aggression is

pursued by Jack Snyder in Myths of Empire: Domestic Politics and

International Ambition, Ithaca: Cornell University Press, 1991. In

addition, see Charles A. Kupchan, The Vulnerability of Empire, Ithaca:

Cornell University Press, 1994.

27. Such a possible movement by Japan toward traditional national

strategy concerns and behavior is especially interesting insofar as

recent literature would probably consider that country to be a highly

unlikely candidate for such traditional statecraft. For compelling

arguments that Japan has moved decisively away from traditional

foreign policy goals and means, see Rosecrance, Rise of the Trading

State. In addition, and for arguments that put special weight on Japan’s

contemporary culture and internal political structures as constraints on

such a return to traditionalism in foreign affairs, see Thomas Berger,

“From Sword to Chrysanthemum: Japan’s Culture of Anti-Militarism,”

46
International Security, Vol. 17, Spring 1993, pp. 119-150; and Peter J.

Katzenstein and Nobuo Okawara, “Japan’s National Security:

Structures, Norms, and Policies,” International Security, Vol. 17, No. 4,

Spring 1993, pp. 84-118. For analyses that suggest that Japan’s foreign

policy is more likely to be a function of external constraints and threats

than internal domestic political and cultural conditions, see Barry

Buzan, “Japan’s Defence Problematique,” The Pacific Review, Vol. 8,

1995, pp. 25-43; and Michael Green and Benjamin Self, “Japan’s

Changing China Policy: From Commercial Liberalism to Reluctant

Realism, Survival, Vol. 38, Summer 1996, pp. 35-58.

28. For the development of this argument, see Joseph M. Grieco,

“Systemic Sources of Variation in Regional Institutionalization in

Western Europe, East Asia, and the Americas,” in The Political

Economy of Regionalism, Helen Milner and Edward Mansfield, eds.,

New York: Columbia University Press, 1997, pp. 164-87.

29. For this line of analysis, see Joseph M. Grieco, “Realism and

Regionalism: American Power and German and Japanese Institutional

Strategies During and After the Cold War,” in Unipolar Politics:

Realism and State Strategies After the Cold War, Ethan Kapstein and

Michael Mastanduno, eds., New York: Columbia University Press,

1999, pp. 319-353.

30. Statement of Secretary of State-Designate Colin Powell to the

Senate, January 17, 2001, and available at http://www.state.gov/

secretary/index.cfm?docid=443.

31. New York Times international reporter and foreign affairs

columnist Thomas Friedman refers to this as the “golden arches theory

of conflict prevention,” based on his observation that, as of the

late-1990s, no two countries had fought each other after they had each

had McDonald’s restaurants established in their respective territories;

see Friedman, The Lexus and the Olive Tree, New York: Farrar, Straus,

Giroux, 1999. For emirical evidence suggesting that economic

interdependence reduces the likelihood military conflicts, see John

Oneal and Bruce Russett, “The Classical Liberals Were Right:

Democracy, Interdependence, and Conflict, 1950-1985,” International

Studies Quarterly, Vol. 41, June 1997, pp. 267-94; and Oneal and

Russett, “Assessing the Liberal Peace with Alternative Specifications:

Trade Still Reduces Conflict,” Journal of Peace Research, Vol. 36, July

1999, pp. 423-442; Oneal and Russett, “The Kantian Peace: The Pacific

Benefits of Democracy, Interdependence, and International

Organizations, 1885-1992,” World Politics, Vol. 52, October 1999, pp.

1-37; and Richard Rosecrance, The Rise of the Virtual State: Wealth and

Power in the Coming Century, New York: Basic Books, 1999.

47
32. For this argument, see Kenneth Waltz, “The Myth of National

Interdependence,” in The International Corporation, Charles P.

Kindleberger, ed., Cambridge: MIT Press, 1970, pp. 205-23; Waltz,

“Globalization and American Power;” Katherine Barbieri, “Economic

Interdependence: A Path to Peace or a Source of Interstate Conflict?,”

Journal of Peace Research, Vol. 33, October 1996; and Barbieri

Katherine Barbieri, “International Trade and Conflict: The Debatable

Relationship,” paper presented at the 35th Annual Convention of the

International Studies Association, Minneapolis, MN, March 18-21,

1998.

33. For the argument that countries’ expectations about future

trade openness affect the impact made by contemporary

interdependence on conflict, see Dale Copeland, “Economic

Interdependence and War,” International Security, Vol. 20, Spring

1996, pp. 5-41. On the role of domestic regime-type on the impact of

economic interdependence on conflict between countries, see Paul A.

Papayoanou, “Interdependence, Institutions, and the Balance of

Power,” International Security, Vol. 20, No. 4, Spring 1996, pp. 42-76;

and Christopher Gelpi and Joseph M. Grieco, “Democracy,

Interdependence, and the Liberal Peace,” unpublished manuscript,

October 2000.

34. Seymour Martin Lipset, “Some Social Requisites of Democracy:

Economic Development and Political Legitimacy,” American Political

Science Review, Vol. 53, March 1959, pp. 69-105; Adam Przeworski and

Fernando Limongi, “Modernization: Theories and Facts,” World

Politics, Vol. 49, January 1997, pp. 155-183. Also important on this topic

is Samuel P. Huntington, The Third Wave: Democratization in the Late

Twentieth Century, Norman: University of Oklahoma Press, 1991.

35. See Robert J. Barro, Determinants of Economic Growth: A

Cross-Country Empirical Study, Cambridge: MIT Press, 1997.

36. As Lindsay Cohn pointed out in a seminar at Duke University,

February 27, 2001, Chinese leaders may be expected to be fully aware

that the United States is pursuing engagement in the hope that the

economic growth engendered by such engagement will ultimately

increase Chinese domestic pressures for democratic change, and with

this awareness they would have both the motive and the opportunity to

take counter-measures to ward off what would likely be their own

personal political (and perhaps physical) demise.

48
CHAPTER 3

HEGEMONIC PROPHECY AND MODERN ASIA:

LESSONS FOR DEALING WITH THE RISE

OF CHINA

Kurt Campbell

INTRODUCTION

The purpose of this chapter is to discuss hegemonic

transitions and great power politics in Asia as a whole.1 The

chapter will be divided into three parts. First, we will look at

the past. We will examine the attitudes and assessments

made by the key players of the region over the last 25 years.

What changes in the balance of power did they expect? Were

they right in their assessments? Second, we will look at the

present. We will examine each of the three great powers of

the region—China, Japan, and the United States. What do

they perceive their position to be in terms of great power

rivalry and politics? What adjustments have they made to

the overall hegemonic pattern? Third, we will consider the

future. We will evaluate the institutional and big power

options available to the countries in the region.

I. THE PAST AS PROLOGUE

1975: Predicting the Fall of the United States.

Let us begin in April 1975. Picture in your minds

American helicopters rising in defeat off of the roof of the

American embassy in Saigon. This moment, which is locked

in our own national imagination, animated the thinking

about the United States of a whole generation of Asian

49
leaders. The autobiography of Lee Kuan Yew goes into great

detail assessing American power in the wake of a

devastating loss.2 He saw the American withdrawal from

Vietnam as the death knell of American power. He thought

that we were witnessing the end of a proud era of American

greatness (1945-75), and that it was highly unlikely the

United States would be able to resurrect itself. Admittedly,

Lee Kuan Yew later realized how wrong he had been, but

the book offers us an interesting indication of what he and

other key players of the region thought at the time.

Another book that is now long forgotten and gathering

dust on our bookshelves was also published in 1975. This

was On Watch, the memoirs of the great naval leader,

Admiral Elmo Zumwalt.3 Zumwalt opens the book by telling

a story about a fierce argument he had with Henry

Kissinger in 1975, which was one of the reasons he decided

to leave the service early. He and Kissinger were debating

about American and Soviet power. In the course of the

debate, Kissinger pulled Zumwalt up short and said [I

paraphrase], “I don’t think you understand, Admiral, what

our goal here is. We’re trying to get the best possible

agreement we can from the Soviet Union. Think of it in a

historical sense: we are playing Athens to their Sparta,

right?” The whole book, then, is based on the Kissingerian

premise that, from the 1970s onwards, the United States

was really in a period of dramatic decline. The driving force

of American foreign policy was the desire to get the best

possible deal from the Soviet Union. In retrospect, this

exchange is very interesting since Zumwalt is relatively

unknown and Kissinger is regarded as the greatest

American diplomat of the last 50 years. It is fascinating to

contemplate the fact that his one overarching strategic

belief was fundamentally flawed.

1986: Predicting the Rise of Russia.

Let us now move a little closer to our own times, and

consider the year 1986. It was in that year that a relatively

50
young leader—young at least in Soviet terms—Mikhail

Gorbachev, traveled to Vladivostok and gave a speech about

the future of Soviet power in Asia. This speech is often

referred to as the “Vladivostok speech.” Many in the

strategic community, particularly in the Soviet strategic

community—I would count myself as one of these

unfortunate souls—then made some predictions. They

argued that this speech was likely ushering in a whole new

era of Soviet power in Asia. The Soviet Union, they said,

could well be the next power to dominate Asian politics. In

retrospect, this is laughable. Fifteen years later the notion

that the Soviet Union was on the march in 1986 and would

be the next power to hold hegemony in Asia, appears to be

totally implausible.

Late 1980s and Early 1990s: Predicting the Rise of

Japan.

In the late 1980s and early 1990s, the animating belief in

much of the strategic community in the United States was

that Japan’s unrivaled economic and political power would

inevitably be translated into military power. The

expectation now was that we would be facing, before too

long, a military challenge from Japan. Books now pictured

Japanese destroyers streaming out of the harbor in

Yokosuka, affirming the notion that the United States and

Japan would almost inevitably come to blows in the late

20th or early part of the 21st century.

This belief in the resurrection of Japanese imperial, or

post-imperial, power was associated in the early 1990s with

a belief in a dramatic and substantial decline of American

power. A new spate of writings echoed some of the worries

earlier voiced by Lee Kuan Yew. America, it was said, had

just lived through a great period, but had used up all its

wealth and power to win the Cold War for us all. Now the

United States was charged with protecting Japan, yet could

not afford a taxi ride or a cup of coffee in any downtown

Tokyo hotel. American greatness was over.

51
1996-97: Predicting the Rise of China.

In the last several years, especially between 1996 and

1997, a new view has emerged. This latest prophecy holds

up China as the new great power on the horizon. After 100

years of absence from the international community, it is

said China is now resurrecting itself. Except in terms of

population, China is not by any real measure a great power.

Nonetheless the expectation that China will become a great

power has already started to affect our thinking. We think of

Asia as a great market, try to determine its future, and

predict that China will be a great power.

One of the most animating features of political thinking

over the last few years has been the absolute expectation of

Chinese success and power. There is an alternative, which

ought to be considered. There is, in fact, a very real

possibility that, in the years ahead, China will be weak,

indeed, dramatically weak. Just as we never anticipated the

collapse of the Soviet Union, we have given remarkably

little strategic thought to the possibility of future Chinese

weakness. This is a subject to which we will return.

2001: Predicting the Rise of India.

Finally, if we turn to cutting edge publications on Asia,

we will find one more set of predictions. In the Financial

Times, Asian Wall Street Journal, and the Far Eastern

Economic Review we will find that the country now viewed

as posing a major power challenge in the 25 or 30 years

ahead now, the new “hot” country as it were, is not China,

but India.

Lessons.

Many things have been predicted over the last quarter of

a century: the rise of Russia, the rise of Japan, the rise of

China, the rise of India and the collapse of the United

States. Yet, in retrospect, the most interesting development

throughout that period has been, ironically, the

52
resurrection of American power. One of the most dominant

features of international relations today is the unsurpassed,

unparalleled power of the United States commercially,

culturally, politically, and economically. In fact, one can

make an argument that never has a country had this kind of

power in the history of modern international relations.

The lesson of all of this is that when you think and talk

about hegemonic transitions, it is generally not good to

think in such short periods of time. When we look back at

the predictions made during the last 25 years, what is most

striking is just how wrong many of the pundits and thinkers

were when making judgments and assessments of great

power.

Therefore, we should not just look at the predictions

themselves. Rather we should pay attention to what it is

that drives the predictions. Asians have something of what

might be described as the “Washington syndrome.” That is,

they are daily preoccupied with thinking about who is up

and who is down. In my view, this is because Asia, at its core,

is an incredibly insecure region. Their concern to achieve

some kind of international balance and their worry over

what country is in ascendancy and what country is in

decline drive their thinking on a day-to-day basis. As we

turn to our consideration of the future, we should bear in

mind what we have learned from our study of reactions over

the last 25 years. We should be humble enough to recognize

that we have only a limited ability to judge the future.

II. THE CURRENT SITUATION

Now that we have considered the power predictions of

the last quarter of a century, it is time to take a closer look at

today’s situation. The goal here is to examine the three great

powers—the United States, China, and Japan. How do they

perceive their own power? How is their power perceived by

the other great powers? What adjustments have they made

to the overall pattern of Great Power politics?

53
Perceptions of Power.

The United States. As we said earlier, the dominant

feature in modern international relations is American

power. How do Americans perceive their power? Consider

here for a moment Mr. Hansen, the American recently

caught spying for Russia. His views, perhaps unexpectedly,

shed some light on this issue. Mr. Hansen sees the United

States as a country that does not really understand its

power, as a sort of giant, clumsy child, unaware of its

tremendous sway and dominance.

Generally speaking, secretly, Asians share this view of

American power. America, in fact, combines great power

and tremendous unpredictability, two things that are

greatly troubling for Asians. These characteristics are an

integral feature of American power. It does not matter, from

an Asian standpoint, whether one is dealing with a

Democrat or a Republican. Asians may want American

power, and they may want American involvement in the

region; however, on one level, American power is deeply

worrying.

Another important question is to ask whether or not

countries in Asia are generally seeking to work with the

United States or generally seeking to undercut American

power. What are the signs here? The record is mixed. Most

countries tend to take advantage of American power. A

well-known Asian diplomat in Washington recently

compared the Asian reaction to America to Microsoft. We

appreciate the operating systems that both provide but seek

every opportunity to subtly undermine their power.

Overall, it seems likely that Asia will become

increasingly nervous about American power in the years

ahead. But will the Bush foreign policy radically depart

from that of Clinton? Joseph Grieco thinks not.4 However,

we should remember that what matters in Asia is not so

much actions as perceptions of actions and the perception is

54
already that there will be substantial differences in foreign

policy.

China. China is the second of the three Great Powers of

Asia. How do the Chinese interpret power in the region? The

most interesting aspect of China’s rise is how they see and

interpret the United States. There is a wealth of

strategic—especially military—writing about the United

States. It has developed into something of a cottage

industry, which fascinatingly, until very recently, clung to

the notion that the United States was in the midst of a

profound and dramatic decline. As late as 1998 and 1999

some Chinese continued to claim that American power was

illusory, that the United States was in the midst of a major

downward trend. It has only been in the last year that a few,

fairly brave individuals have voiced a different view. These

writers tend to live away from the center of things in Beijing

(most of them are based in Shanghai). They admit, albeit

cautiously, that they may have misjudged the situation.

While they continue to argue that the United States will

likely decline over the long-term, they now say that in the

short term and even medium term, American power is

something that they will have to deal with.

Many Chinese writings reflect deep discomfort about the

United States and American power. The Chinese are not

just alarmed about American regional alliances and

American support of Taiwan, but by American power per se.

The Chinese would very much prefer a multi-polar world,

one in particular, in which they have a role to play.

Japan. The third great power in the region is, of course,

Japan. When Fumio Hayashi, the great Japanese

journalist, coined the term, the “Lost Decade,” he was

referring to Japanese economic and political power and to

the application of that power in the international realm.5

When we think about the 1990s as a lost decade, we have to

consider what fundamentally animates Japanese foreign

policy. In many respects Japanese foreign policy—and I

mean this in the most benevolent way—has never really

55
been driven by strategic objectives. There is probably more

sentimentality associated with Japanese foreign policy

than with any other great power in modern history. The

“lost decade” is best seen as an adjustment to the failure of a

model. Japan realized that it would not, after all, be able to

prevail economically against the United States, and dealing

institutionally with the demise of the dream of economic

victory over the United States has been difficult.

Interestingly, over the last decade, the top priority of our

Japanese friends was to try and develop a better

relationship with China. This has been in many respects, a

dismal failure.

Russia. Before we move on, a brief word should be said

about Russia. Generally speaking, two inaccurate things

animate our thinking about Russia. First, we tend to

assume that Russia will always be preoccupied with

European affairs rather than Asian affairs. Second, we tend

to think that they are in the midst of a decline that cannot be

reversed. Both of these views are, in my opinion wrong.

However, for the sake of brevity, we will not dwell on this

point, especially since the Russians do not play an

important role in the power politics of the region, excepting

their policies viz-à-viz China.6

Adjustments to Changing Power.

Lack of Multilateral Institutions. The first thing that an

observer should note about Asia is the rather troubling lack

of working, formal, international institutions capable of

dealing with abrupt or subtle changes in the international

system.

In many respects the most important development in

power in Asia in the last 5 years has been associated not

with the big powers (Japan, the United States, or China) but

with a sub-power, Indonesia. It was Indonesia, supported by

Singapore, that drove the process of multilateralism in Asia

over the past 5 years. Indonesia’s dramatic plummet from

power to merely hanging on by a thread to political stability

56
is one of the most animating and misunderstood

developments in Asia today. If one were to draw up a list of

countries who are important to the United States and yet

whose importance is not understood by the United States,

Indonesia would top that list.

What of the Association of Southeast Asian Nations

(ASEAN) Regional Forum? This, unfortunately, has proved

to be a bit of a disappointment. Over the last several years

we had really tremendous opportunities to move ahead with

a broader agenda on confidence building and maybe on

conflict prevention. The leadership of the organization,

unfortunately, was primarily interested in gathering new

members, as opposed to deepening an agenda. It was also

very afraid to alienate the major powers, especially China;

therefore, remarkably little of the things that needed to be

done got done. Much of the attention and the creative time

associated with the last ASEAN Regional Forum meeting

was, in fact, devoted to the evening of entertainment. Every

country had to put on a skit to showcase its wares. This

initiative was intended to be a fun opportunity for the

representatives of different nations to get together in a

relaxed fashion. Of course, in great Asian style, it became a

hyper-competitive event, in which every nation basically

ran true to form. Our Japanese friends hired the best drum

players in the world, sneakily brought them in on

diplomatic protocol, while the United States tried to do last

minute duets with Russia and then get out of town. That

was the sort of thing that happened. In short, Asia, unlike

Europe, lacks institutions that can help it adjust to changes

in the international scene and enable it to mellow and deal

with hegemonic transitions.

Bilateral Relationships. In the United States, the Bush

administration has highlighted its desire to revitalize the

bilateral relationships. Revitalizing the security

relationships is extremely important, and is a process that

substantially predates the Bush presidency. Secretary

Perry in fact, began it in the mid-1990s. However, Asian

ears like to hear two things simultaneously: engage China

57
and revitalize the bilateral security relations. The

perception, at least in Asia, seems to be that we intend to do

the one without the other.

The most dramatic diplomatic achievements of the last

five years have taken place in China. Beginning in about the

middle of the last decade, China set about establishing very

substantial confidence and security building arrangements

with every country on its border, with Russia, the Central

Asian Republics, India, Burma, and throughout Southeast

Asia. These arrangements were made in rapid succession.

III. THE FUTURE: BIG POWER OPTIONS

Finally, let us consider what appear to be the big power

options of China, Japan, and the United States.

China.

The indications are that a dramatic change in Chinese

orientation is underway. The Chinese leadership seemingly

now recognizes, with a mixture of hope and trepidation, that

1,000 years of history is about to be relegated to the ash-bin.

For 2,000 years, China’s primary focus has been towards the

land. Now they are increasingly coming to believe that, in

order for China to prosper, they must turn to the sea. They

are looking to establish sea lines of communication,

especially to the east. They are attempting to develop major

relationships with the United States, Japan, and Korea.

This is something that the United States should notice.

We tend to concentrate our attention on the magnitude of

China’s power, which is important. However, we should not,

in so doing, forget to think about China’s orientation. The

Chinese are moving dramatically away from their landward

orientation and are increasingly coming to appreciate that

trade, energy supplies, and sea lines of communication are

important to it. These are areas in which the United States

and the international community will have the greatest

58
potential for positive engagement with China. They are

possibly contentious areas as well.

What of future Chinese bilateral relationships? Of late,

the Chinese appear to have decided to enter into a tactical

embrace with Russia. This is the more worrying the longer it

goes on. China has procured from Russia a really

substantial amount of military capability, primarily

designed for a potential Taiwan scenario, possibly involving

the United States. This is not a welcome development. It is

creating more and more concern in the region as a whole.

Japan.

As for Japan, the last 10 years have been the “lost

decade”. Its political and foreign policy elite have, more than

anything else, wanted to develop a better relationship with

China. For a whole host of reasons they have been

unsuccessful. Especially daunting is what we learn from

public opinion polling in Japan. The vast majority (60-70

percent) of Japanese above age 45 believe that it is in

Japan’s interest to have a good strong relationship with

China. In contrast, among Japanese between the ages of 18

to 43-44, that interest in a better relationship with China

totally and completely evaporates. Polls suggest that this

coming-of-age group of Japanese citizens have had it with

China. They do not feel that China has the moral

wherewithal to criticize Japan the way they have been

doing. They feel, moreover, that Japan has become a

different country over the last 60 years, and is no longer the

Japan of 1937-38.

The United States.

Over the last 10-15 years, 80-90 percent of American

strategic creativity, interests, and activity has been devoted

to three major issues, all of them in Europe. First,

Americans have focused on dealing with the transformation

of the Soviet Union into Russia. This process, which is still

underway, is messy and has wide ramifications in both the

59
military-political and economic spheres. Second, Americans

have been preoccupied with the reunification of Germany

and the associated task of forging a new NATO for the 21st

century. Third, they have been picking up the mess from

Tito’s Yugoslavia. For the past 10 years, 90 percent of

American strategic creativity, energy, and activism, both in

the latter years of the Bush administration and the entire

Clinton administration, have been devoted to these three

challenges.

Over the next 10 years we will likely see a perceptible

shift in American attention away from Europe and towards

Asia. What are likely to be the major challenges and

preoccupations of the future?

• Topping the agenda will be the inevitable changes and

developments associated with change on the Korean

peninsula. This process is underway and cannot be

stopped now that the two Koreas are in the process of

a very significant strategic embrace. The process will

be difficult under all circumstances.

• The rise of China will also likely engage American

energies. The United States will not only have to deal

with China but also with Japan as part of that

process. China’s rise has tremendous implications for

the United States. The rise will affect us in what we

might call a psychic and philosophic way. Long before

it affects us, however, it will affect our friends in

Japan and in a much more direct and significant

fashion. Thus, as we increasingly think about this

relationship, it is important that we think about it

less in terms of a bilateral context and more in terms

of the trilateral sense. You cannot have profound

peace and prosperity in Asia unless the three great

powers of Asia can somehow find a way to work

together in the future.

• Indonesia will also be an area that will need our

attention. This country looks as if it is coming to the

60
end of incoherence. Here we will need to pick up the

pieces.

• Just after these top three items, would be an Asian

economic crisis. The possibility of such a crisis lurks

immediately on the horizon. Most Asian countries

failed to make the changes that were needed in 1998

to ensure continued prosperity. The American

economy, which served as a global engine of growth, is

slowing down. This will only aggravate matters,

especially since those countries, which have regained

their prosperity since 1998, did so exclusively because

they found it easy to penetrate American markets.

CONCLUSION

What then are the lessons to be learned from a study of

the patterns of hegemony in Asia? First, to reiterate, one

must be very cautious about making predictions. If the past

quarter-century has made anything clear, it is that it is very

hard to foresee with any accuracy which powers will gain or

lose power. This book is devoted to the study of the security

implications of the Rise of China: we should remember that

it is by no means self-evident that China will rise.

Second, we must always consider not only the realities,

but also the perceptions of power, which are often the

driving force of international politics. Third, we should take

note of some of the destabilizing forces that face us in Asia.

Asians are insecure and worried about American power.

They also lack the kind of multilateral institutions that can

ease tensions caused by rising and falling patterns.

Fourth, we should always be aware of the overall Asian

context and not focus on great power politics to the exclusion

of all other things, nor on the bilateral relations of the

United States. The importance of sub-powers should not be

underestimated. The rise and fall of Indonesia, though it is

not a great power, has played an enormously important role

in Asia in the last 5 years. Again, we should never lose sight

61
of the fact that the overall stability of the Asian region

depends on the development of good relations among all the

Asian powers. While the rise of China is of real importance

to the United States, we should equally bear in mind how

this rise may affect Japan.

Finally, let me close by insisting on the importance of

paying strategic attention to Asia, and by thanking the

Army for supporting this work. It is very much a tribute to

this institution that it is willing to take an interest in a part

of the world in which it is likely to play a decreasing role in

the future.

ENDNOTES - CHAPTER 3

1. For those interested in reading more on the challenges facing the

United States vis-à-vis China, the best book of its kind is by David M.

Lampton, Same Bed, Different Dreams: Managing U.S.-China

Relations, 1989-2000, Berkeley: University of California Press, January

2001.

2. Lee Kuan Yew, The Singapore Story: Memoirs of Lee Kuan Yew,

Singapore: Times, 1998.

3. Elmo Zumwalt, On Watch: A Memoir, New York:

Quadrangle/New York Times Book Co., June 1976.

4. Dr. Greico addresses this issue in Chapter 2 of this book.

5. Fumio Hayashi and Edward C. Prescott, The 1990s in Japan: A

Lost Decade, Minneapolis: Federal Reserve Bank of Minneapolis,

November 2000.

6. Their impact on China is, however, appreciable, and we will

devote some time to this later in the chapter.

62
Part II.

IS CHINA A SECURITY THREAT?

63
CHAPTER 4

RISING CHINA:

A THREAT TO ITS NEIGHBORS?

Michael R. Chambers

INTRODUCTION

Whether or not China poses a threat to its Asian

neighbors has been an issue debated by many since the

mid-1990s. The occupation of Mischief Reef by the People’s

Republic of China (PRC) in early 1995 set off alarms in the

region that China’s rapidly developing economy and

increasing budgets for the modernization of the People’s

Liberation Army (PLA) could lead to a Chinese threat to the

region. These concerns were reinforced in the East Asian

region and in the United States in spring 2001 when the

PRC announced that it was increasing the PLA’s official

budget by almost 18 percent to approximately $17.2 billion.1

Impressions of a more militarily assertive China were

strengthened, at least in the United States, by the mid-air

collision of a Chinese F-8 fighter jet and a U.S. EP-3

surveillance plane on April 1, 2001, and the 11-day standoff

over the detained American crew.

While these incidents and developments have played

into the fears of some of a “China threat,” others have sought

to remind us that these fears are exaggerated, at least for

now. Whether focusing on China’s military capabilities or a

combination of its intentions and capabilities, they argue

that the PRC is a conservative, middle power that may not

really matter—at least to the degree that the alarmists

would have us believe.2

65
Is rising China a threat to international security, and in

particular a threat to its East Asian neighbors? This chapter

will address this question, and, in doing so, will side with

those scholars who are less alarmist about China’s threat to

the East Asian region today. The PRC lacks the capabilities

at present to seriously threaten the security of its neighbors,

with a few exceptions, and its intentions are also more

inclined toward maintaining the regional status quo for the

moment. However, this could change in the near-to

medium-term future, based on the success of China’s

economic development.

I. CURRENT THREATS

China is Not a Global Threat.

As we evaluate China’s potential ability to threaten

international security, it is important to consider the

geographic scope of that threat. Aside from threatening the

international proliferation regimes, with consequences

primarily in the Middle East, China’s ability to threaten

security is restricted largely to the East Asian region

(defined as both Northeast and Southeast Asia). As others

have noted, China has not replaced the former Soviet Union

as a global threat to U.S. interests and to the security of

regions all over the world. China is not seeking to construct

a network of client states all over the globe through which to

challenge U.S. and Western interests. The Chinese will

work with coalitions of other countries on certain

issues—such as human rights—to oppose U.S. interests and

advance Chinese interests. However, we do not find a large

Chinese-led coalition seeking to oppose the United States on

a broad agenda of issues. Nor is China seeking to spread a

specific ideological vision of the world and to gather other

countries under its ideological leadership. (It is also not

clear that a stronger China in the future would be leading a

crusade for some new ideology and seeking adherents under

its leadership.)

66
Certainly, China wants to curb U.S. influence globally

by promoting multipolarity, with China as one of the great

powers, but this is not necessarily a threat to international

security. In fact, a five-power multipolar configuration of

power was advocated by Richard Nixon and Henry

Kissinger when the former was president, with China

serving as one of the great powers in this system. Whether

or not you see China’s support for the emergence of

multipolarity as a threat depends, perhaps, on your

assessment of whether multipolarity or unipolarity (or

some hybrid of the latter) will do more to secure

international stability and security.

Most importantly, China lacks the capabilities to try to

project power globally, and it does not seem likely to develop

such capabilities in the near future. China is a continental

power, with a military that is geared primarily toward

defending the Chinese mainland from attack—dating back

to the “people’s war” strategy of the Maoist era. The People’s

Liberation Army (PLA) Navy lacks a blue water navy and

has no aircraft carriers with which to project seapower.

Similarly, the PLA’s air force is still rather antiquated and

lacks long-range capabilities. China’s military

modernization program over the last several years has

sought to develop and acquire new naval and air weapons

systems, such as Su-27 and Su-30 fighter aircraft and two

Sovremennyy class destroyers from Russia, that would

enhance the PLA’s capabilities to defend China out away

from its land and sea borders, but these do not bring it

longer range power projection capabilities.3 The one area in

which the PRC does have some global reach is in nuclear

weapons; China has approximately 20 nuclear-tipped

intercontinental ballistic missiles (ICBMs) and a single

ballistic missile submarine (still not fully in service) that

can carry perhaps a dozen nuclear-tipped

submarine-launched ballistic missiles (SLBMs).4 These

serve as China’s nuclear deterrence against the United

States and other nuclear powers. In addition, China has

hundreds of short-, medium-, and intermediate-range

67
ballistic missiles and is developing more of these, but the

range of these missiles prevents them from presenting more

than a regional threat. As mentioned above, Chinese sales

of missile technology to Iran, Libya, and Syria, as well as to

Pakistan, threaten the international non-proliferation

regimes, but China is not itself threatening regional

security in the Middle East.

Does China Threaten Its Asian Neighbors?

If China is not a global threat, does it present a threat to

East Asian regional security? Does the PRC threaten its

neighbors in East Asia? Generally speaking, China does not

currently threaten its neighbors, with two principal

exceptions: Taiwan and other claimants to the Spratly

Islands in the South China Sea. China has some

capabilities, particularly in terms of its missiles, to threaten

its regional neighbors. The PRC has deployed a combination

of short-, medium-, and intermediate-range ballistic

missiles that together give it the ability to strike all of its

neighbors.5 And its modest air and naval capabilities do

provide it the ability to threaten the security of nearer,

weaker neighbors. Nevertheless, this threat is limited by

China’s inability to project air and sea power far from its

shores. With these qualifications to China’s threat capacity,

it could be argued that China’s ability to threaten the

countries of East Asia today is less than it was in the 1960s,

when it supported various communist insurgencies (often

with a core of ethnic Chinese) struggling to overthrow the

regimes of Southeast Asian countries such as Thailand,

Malaysia, Laos, and South Vietnam. The PRC also had ties

to the Communist Party of Indonesia, which was destroyed

following its complicity in the aborted leftist coup attempt of

October 1965. While not as high-tech as ballistic missiles,

this support for communist insurgencies was a capability

well-suited to the political situations in the countries of

Southeast Asia, and the threat to the political orders of

these countries was quite pronounced at the time.

68
The current threat posed by China is limited inasmuch

as its capabilities are limited. It is further limited in that

China appears not to have aggressive intentions towards its

neighbors. The PRC is still preoccupied with its economic

reforms and its desire to create economic growth. The

legitimacy of the post-Mao leadership has rested heavily on

its ability to foster economic development, which has

required significant reform of the economy to include

market forces. China’s effort to join the World Trade

Organization has become an important element of this

strategy, yet one that will require even greater changes to

its economy and policies. The leaders in Beijing need to cope

with the political and economic consequences of continuing

economic reforms, especially those which affect the state

owned enterprises and which are likely to result in heavy

unemployment. China is increasingly troubled by labor

demonstrations: workers who have been laid off have

engaged in large scale demonstrations while peasants have

demonstrated against government corruption and illegal

taxes.6 While economic in nature, such unrest could pose a

political challenge to the government.

The Chinese leadership also remains extremely

concerned about domestic political stability. This is most

evident in the continuing campaign against Falun Gong,

but can also be seen in government calls for vigilance

against ethnic separatism and religious extremism, both of

which can be found in western Xinjiang province as well as

elsewhere.7 To achieve these economic and political goals,

China needs a stable international environment in which it

can focus its attention on its domestic needs. Such an

environment cannot be attained if the PRC is acting in a

hostile manner towards its neighbors.

In terms of relations with its East Asian neighbors,

China seems to have two principal goals.

1. To foster a regional international environment that

takes China’s interests into account.

69
China sees itself as a (or perhaps the) regional power,

and believes that it deserves respect and deference. This

self-perception derives in part from China’s past role as the

center of a Sinic cultural world, of being the “Middle

Kingdom,” in which the Chinese emperor was the Son of

Heaven and all other countries in the region were in some

degree of subordinate tributary status to China.

One of the primary goals of the PRC’s foreign policy since

the founding of the communist regime in 1949 has been to

return China to this status of regional power, and the

Chinese leaders feel they have now achieved this goal. We

can point to several examples of deference to Chinese

interests. Recently, for instance, Beijing tried to prevent an

international conference on Falun Gong from being held in

Thailand, and the Thai government acceded to China’s

demand, pressuring the local Falun Gong adherents to call

off the conference.8 Similarly, the ASEAN Regional Forum

(ARF) has been hesitant to move faster than China is

willing in progressing from mere discussion of security

issues to becoming a forum for conflict prevention.

2. To develop military capabilities to defend Chinese

interests and territory out at a distance from the PRC’s

borders.

This is an important thrust of China’s military

modernization program. These capabilities, such as

developing a “green water” navy that can meet threats to

the PRC off-shore rather than relying on coastal defense,

will be useful in a conflict in the Taiwan Strait or in the

South China Sea over the Spratly Islands. Chinese analysts

emphasize that these capabilities will be defensive in

nature, although they position the new maritime outer

defense perimeter well off the mainland, stretching from the

Korea Strait in the north, to the Ryukyu Islands in the east,

to the Spratly Islands in the south.9 The Su-27s and the two

Sovremennyy class destroyers that the PRC has purchased

from Russia are part of this defense plan, as are the new

70
domestically produced Jiangwei II class frigates and the

Luhai class destroyers.

While China wants to have its interests taken into

account by the countries of the East Asian region, this does

not mean that China will seek to dominate its neighbors the

way the Soviet Union did its neighbors. China simply lacks

the capabilities to do so. Without power projection, the PRC

lacks the ability to threaten coercive power against these

countries, which would be necessary if they do not listen to

diplomatic persuasion.

In fact, China has developed cordial, cooperative

relations with nearly all of its neighbors save Taiwan. Even

there some progress has been made recently regarding

economic interactions.10 China has good bilateral relations

with all of its neighbors in East Asia. It concluded long-term

cooperative agreements (including political, economic, and

security cooperation) with all ten of the Association of

Southeast Asian Nations (ASEAN) during 1999 and 2000. It

also entered into a “Partnership of Friendship and

Cooperation for Peace and Development” with Japan in

1998 and a “full-scale cooperative partnership” with South

Korea in October 2000. While it may be true that China

originally joined regional organizations such as the

Asia-Pacific Economic Cooperation (APEC) forum and the

ASEAN Regional Forum (ARF) so as to ensure that they

would not be used to harm Chinese interests, it is only fair to

say that China has been a useful and cooperative

participant. It has also participated in the recently

inaugurated ASEAN Plus Three summits, which bring the

PRC, Japan, and South Korea into discussions with the

members of ASEAN.

China has sought to resolve many of its outstanding

territorial disputes. In the last 2 years it has signed

agreements and protocols with Russia and Vietnam,

resolving almost all of their remaining land border disputes.

Where no immediate solution could be found, China has

sought to reach agreement with its neighbors to shelve the

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issue and to move ahead cooperatively on other fronts.

Examples here include the Senkaku/Diaoyu Islands dispute

with Japan, and the Spratly Islands dispute with Brunei,

Malaysia, the Philippines, and Vietnam. (The Chinese are

currently involved in discussions with the other claimants

to the Spratlys on a Code of Conduct to reduce tensions in

the South China Sea.)

China further sought to demonstrate its good regional

citizenship by contributing a civilian police contingent to

the United Nations (U.N.) Security Council-sanctioned

international force in East Timor (INTERFET) in 1999.

Finally, the PRC contributed to the bailout of the Southeast

Asian countries in the wake of the 1997 financial crisis. It

provided $1 billion each to Thailand and Indonesia, and

pledged $4 billion dollars overall.11 Beijing also promised

not to devalue its currency, which could have undermined

the ability of some of the Southeast Asian countries to use

exports to help drive their recovery from the crisis.

Whether one looks at bilateral or multilateral relations,

at economic or security issues, the evidence points in the

same direction. China today is pursuing a non-aggressive

foreign policy toward its neighbors and, to a large extent, is

attempting to maintain the status quo in the East Asian

region. This approach is likely to last for at least the next

several years. Before turning to consider what might

happen after that time span, let us first briefly examine the

subregions neighboring the PRC.

Northeast Asia: the Korean Peninsula.

China has been a strong supporter of the status quo in

Northeast Asia, particularly on the Korean peninsula.

While the PRC has enjoyed close relations with North Korea

since 1950, and has given support in the past to North

Korean aspirations for reunification of the peninsula under

Pyongyang’s rule, Beijing has backed away from that

position. Since the late 1980s, Sino-South Korean relations

have flourished, particularly in the economic realm.12 China

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no longer wants a reunified Korea, especially since such a

Korea would likely be ruled from Seoul and closely allied

with Washington. China would prefer a divided Korea,

although it would like North Korea to become a more stable

and prosperous state than it is at the moment.

To help bring this about, China has for many years now

sought to promote economic reform in North Korea. It would

like Pyongyang to follow Beijing’s path and undertake

economic reforms while maintaining political control over

the society. As part of this promotion strategy, the Chinese

leadership has hosted two visits by North Korean leader

Kim Jong-Il in just 8 months during mid-2000 and early

2001. In short, the Chinese think that they will be better

able to influence a Korea that remains divided and so, where

Korea is concerned, they essentially want to maintain the

status quo.

North East Asia: Japan.

Regarding Japan, China has sought to develop good

relations with this major power, but there are still

significant points of friction. Since Chinese President Jiang

Zemin’s November 1998 visit to Japan, Prime Minister

Keizo Obuchi traveled to Beijing for a summit in July 1999,

and Prime Minister Zhu Rongji returned the favor in

October 2000. The two countries resumed a bilateral

security dialogue in October 1999, and exchanged visits of

senior military as well as political figures in 2000.

Despite these efforts, the legacy of Japanese actions in

World War II and the existence of territorial disputes have

continued to hamper smooth relations. Problems over

history flared most recently in spring 2001, as the Chinese

once again took offense to a Japanese textbook that glossed

over its wartime actions in China. Beijing also expressed its

outrage at the August 13, 2001, visit of Prime Minister

Junichiro Koizumi to the Yasukuni Shrine honoring

Japan’s World War II dead. These problems have arisen

primarily due to Japanese domestic politics. Nevertheless,

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they have set back the progress made by Prime Minister

Zhu’s fall 2000 visit, during which he downplayed the need

for an apology from Japan and otherwise avoided stressing

problems stemming from the troubled past.

In terms of the territorial dispute, conflicting Chinese

and Japanese claims to the Senkaku/Diaoyu Islands

present a minor Chinese threat to Japanese (claimed)

territory. Nevertheless, Beijing was very restrained during

the 1996 flare-up of this dispute, and has sought to shelve

this issue in order to pursue other avenues of more

cooperative interaction. However, this goal has been

partially undermined by the fact that China has continued

to send maritime research and even military vessels into

Japan’s maritime exclusive economic zone (EEZ) near the

Senkakus and other areas. This issue has, consequently,

remained as an irritant. Fortunately, China and Japan

agreed in mid-February 2001 to a mechanism for prior

notification of maritime research activities in the disputed

waters.13

While the PRC has sought good relations with Japan, it

has also sought to prevent Japan from significantly

expanding its military capabilities or operations. The

Chinese continue to be wary of any return of Japanese

militarism. Beijing has issued many public protests and

expressions of concern over the last several years regarding

Japan’s potential support of U.S. military operations in the

Taiwan Strait area. The concerns date back to the 1997

revision of the U.S.-Japan Defense Guidelines. These

security arrangements outlined in the document allow for

mutual cooperation between the United States and Japan

“in situations in areas surrounding Japan.”14 The Chinese

see this as an attempt to include Taiwan within the scope of

U.S.-Japan defense cooperation.

Another recent example of this Chinese concern

occurred in March-April 2000, when the Japanese

government floated a proposal that some of their Coast

Guard vessels be included in a multilateral force seeking to

74
combat piracy in the South China Sea. This would have

resulted in Japanese vessels patrolling seas more than

1,000 nautical miles from the Japanese home islands. While

the ASEAN countries were amenable to Tokyo’s proposal,

the Chinese vehemently opposed it.15

Finally, the PRC is wary of the U.S. proposal to establish

a theater missile defense (TMD) system which would shield

Japan and South Korea (allegedly from a missile attack

from North Korea). The Chinese oppose TMD in part

because they are afraid Taiwan would be included in the

system, but also because it would undermine their primary

means of threatening these two neighbors. TMD also would

more closely integrate the defense relations between the

United States and these two regional allies at a time when

China is trying to weaken U.S. influence in the area.

North East Asia: Taiwan.

Taiwan of course is the one neighbor that China very

seriously threatens. While the PLA currently lacks the air

and amphibious naval capabilities to invade the island, it

has sufficient missile capabilities to destroy Taiwanese

property and lives, and it has a sufficient number of

submarines and surface vessels to threaten the island with

a blockade, which could severely disrupt the Taiwanese

economy. And as mentioned above, the PLA is currently

seeking to enhance its ability to threaten the island.

Yet even with these threat capabilities, the PRC at a

minimum wants to maintain the status quo of Taiwan’s

ambivalent international status: the status quo means that

Taiwan does not achieve any real degree of independence in

the international realm. Of course, Beijing’s most preferred

outcome is a peaceful reunification of the island with the

mainland.

The recent tensions in the Taiwan Strait, in 1995-96 and

in 1999, are a product of the interaction of these minimum

and maximum interests. China engaged in military

75
exercises in 1995-96—including the firing of missiles into

the Strait—and threatened to repeat these exercises in 1999

due to fears that President Lee Teng-hui was trying to push

Taiwan toward greater independence and international

recognition. Thus, these tensions were caused by Beijing’s

pursuit of its minimum interests: China thought that Taipei

was seeking to change the status quo.

But these tensions were also caused in part by the PRC ‘s

pursuit of its maximum interests. Since early 1995, when

President Jiang Zemin laid out eight points to govern the

reunification of Taiwan in his Chinese New Year’s Eve

speech, Beijing has sought to accelerate the reunification

process to ensure that it would occur during Jiang’s

leadership, thereby building up his historical legacy.

Where Mao Zedong had claimed that the problem could

be solved in 100 years and Deng Xiaoping felt the issue could

wait at least a generation, Jiang Zemin’s government issued

a White Paper in February 2000 which asserted that the

PRC would not wait forever for an agreement on

reunification. Media leaks via Hong Kong claimed that an

agreement needed to be reached by sometime around

2007-10.

Supporting the status quo in Northeast Asia—including

in Taiwan—is therefore in China’s interest for the moment.

It keeps Korea divided and thus more easily influenced by

the PRC, and it prevents Japan—China’s chief Asian

rival—from expanding its power in the region. It also

prevents Taiwan from altering its status in ways inimical to

Chinese interests and buys time for the mainland to

persuade the Taiwanese to agree to reunification.

Southeast Asia.

Since the end of the Cambodia conflict in the early 1990s,

the PRC has enjoyed good relations with both the

non-communist countries of ASEAN and the Indochinese

countries. In fact, with the conclusion of the Paris

76
Agreements in 1991, China achieved its long-standing goal

of preventing any other country—whether a power from

outside the region or one of the Indochinese countries

themselves—from dominating that subregion. Even

Vietnam has accommodated itself to China’s preeminent

influence in Indochina. Moreover, Chinese cooperation with

the ASEAN countries during the Cambodia conflict helped

to alleviate the fear of China, which had been generated by

its previous support for the communist insurgencies in

many of these countries.

At this time, China appears satisfied with the political

status quo in Southeast Asia, with the exception of the

dispute over the Spratly Islands. Not only has it created

good bilateral relationships with the Southeast Asian

countries, it has entered into various dialogues and regional

organizations with its neighbors to the south, such as the

ASEAN Regional Forum and the ASEAN-China dialogue.

As mentioned above, during 1999-2000 the PRC concluded

long-term cooperation agreements with all ten of the

ASEAN member states, covering economic, political, and

even military cooperation (e.g., exchange of official visits),

among other issue areas.

It also has acted as a good neighbor during some of the

crises that have plagued the region of late. China’s response

to the harassment and killings of ethnic Chinese in

Indonesia brought on by the economic crisis there in 1997

was notably muted.

Moreover, the PRC played a very constructive role

during the economic crisis, contributing to the International

Monetary Fund (IMF)-led bailout of Thailand and

Indonesia and refraining from devaluing the renminbi

despite China’s own slumping exports. As an aside, it is

worth noting this devaluation pledge: it points to an

important nonmilitary capability the Chinese can use to

threaten the economic security and social stability of

countries such as Thailand, Indonesia, and the Philippines.

China is competing with these countries for export markets,

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and the PRC has an advantage over them with regard to

cheap labor. A sharp devaluation of the Chinese currency

could undermine the efforts of these Southeast Asian

countries to regain the growth patterns they enjoyed in the

early to mid-1990s.

Analysts interested in assessing potential Chinese

threats in Southeast Asia have focused their attention on

the Spratly Islands in the South China Sea. This is

primarily because China has grabbed several of the islands

and reefs in this island grouping over the last few years. In

1988, China seized seven islands from Vietnam after a brief

naval clash. In 1995, China occupied Mischief Reef, which is

claimed by the Philippines, and placed markers on several

other reefs and shoals in the area claimed by Manila. A few

stand-offs between Chinese and Philippine vessels have

occurred since then. Moreover, the Chinese have continued

to build on Mischief Reef: a recent photo carried by Reuters

showed several concrete structures and construction cranes

in addition to the original bamboo shacks built by the

Chinese “fishermen.”16

Since China did not occupy any of the Spratly Islands

prior to the seizure of the Vietnamese-controlled islands,

these actions have been seen as acts of aggression designed

to change the status quo. Despite this, however, it must be

noted that Beijing has been willing to discuss the dispute

with the Southeast Asian claimants—Brunei, Malaysia, the

Philippines, and Vietnam. It appears that China and the

Southeast Asian claimants are relatively close to agreement

on a code of conduct to govern their behavior in the Spratlys,

with one of the major stumbling blocks being Vietnamese

insistence that the code also cover the Paracel Islands in the

northern part of the South China Sea (which China seized

from South Vietnam in 1974).17 A bilateral Sino-Philippine

code of conduct is also under discussion. Moreover, the PRC

has not seized any islands or islets since 1995.

The inconsistency of Chinese behavior in the Spratlys

complicates our analysis. There are a number of possible

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explanations for these inconsistencies, all of which lead one

to different interpretations of Chinese intentions. One

possibility is the sporadic, or partial, efforts to occupy

islands may be a reflection of bureaucratic infighting in

Beijing. It may be, for example, that the PLA Navy is

striving to occupy islands while other ministries (e.g., the

Ministry of Foreign Affairs) are attempting diplomatic

efforts to defuse the situation.18 A second possibility is that

the Chinese made some initial efforts to stake their claims

to the islands but backed away from further occupations

because of the international uproar that followed their

movements on Mischief Reef.

A third possibility is that China seized these islands,

some from Vietnam and one from the Philippines, as a

preemptive measure. The PRC may have feared that these

two claimants—and others—might take steps vis-à-vis the

Spratlys that would harm Chinese interests in the islands

and in the potential mineral wealth that lies beneath them.

Occupying several of the islands would ensure that China

would have a strong voice in any decisions reached

concerning the islands and the resources associated with

them. This third interpretation reinforces the view of China

as a nation primarily intent on preserving the status quo.

While China’s intentions regarding the Spratlys are

somewhat obscure, its determination not to back down from

its claims is very clear. However, the threat here may not be

as serious as it is sometimes made out to be. Certainly, all

states want to maintain their territorial integrity, and none

are willing to allow the forcible seizure of any part of their

territory to go unchallenged.

Still, the threat should be kept in proportion. In the first

place, the Spratlys do not form part of the core territories of

any of the claimant states. They are of peripheral not core

interest. In the second place, China no longer poses a

political challenge to the claimant states. In the 1950s and

1960s, by contrast, the PRC sought to undermine the

political regimes of many of these states by its support of

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communist insurgencies. This it no longer does. In the third

place, as we have already mentioned, Beijing has tried not

to let this dispute preclude the pursuit of cooperative

relations with these neighbors in other areas.

South Asia.

Thus far our analysis has focused on the potential threat

China poses to its East Asian neighbors. South Asia is

another important region neighboring the PRC and

potentially threatened by China. Let us briefly examine

China’s relations with its South Asian neighbors.

China has, by and large, sought to establish cooperative

relations with countries in South Asia (including with its

one-time foe, India) just as it has in Northeast and

Southeast Asia. However, in Northeast and Southeast Asia,

China’s policy is not based on threatening any of the

countries save Taiwan. This is not the case in South Asia,

where China’s policy is based intentionally, if only

implicitly, on threatening a regional country: India.

China has sought to prevent India from gaining the

upper hand over Pakistan, thereby maintaining something

approximating a balance of power in the region. India has

sought to enhance its security against Pakistan through the

development of new weapons systems, such as nuclear

weapons and ballistic missiles. Meanwhile, China has

quietly supported its ally, Pakistan, so as to counterbalance

these Indian efforts. Among other things it has provided

assistance to the Pakistani nuclear weapons and ballistic

missile programs.

Some in the United States argue that these Chinese

actions undermine international security, particularly by

violating the international nonproliferation regimes.

China, however, sees its behavior in a different light. As far

as China is concerned, it is ensuring a somewhat even

distribution of power in South Asia. In so doing, it is not

80
disrupting but rather supporting the status quo. India is the

country seeking to alter the status quo, not China.

Despite this implicit threat, China continues its efforts

to forge good relations with the countries of South Asia,

including India. In May 2001, Prime Minister Zhu Rongji

visited Pakistan, Nepal, the Maldives, and Sri Lanka to

boost cooperation between the PRC and these neighbors.

Shortly after this trip, the Indian Defense Ministry

announced on May 24 that a Chinese destroyer and

replenishment ship would join with Indian naval vessels

later in the week for 1-2 days of exercises in the Arabian Sea,

the first time such an event has occurred in 7 years.19

The Chinese Threat Today.

To summarize the situation today, it is clear that the

PRC lacks the capabilities which would permit it to pose a

serious threat to the security of any of its East Asian

neighbors other than Taiwan. China does pose a threat to

Southeast Asian countries inasmuch as it also claims the

Spratly Islands, but this is a threat to peripheral territory of

these countries—albeit territory with the potential for

mineral wealth. As to India, China is indeed threatening it.

However, it is doing so to maintain rather than overturn the

regional balance of power and the status quo.

Equally important, China’s intentions toward these

neighbors are largely nonaggressive. China wants a

peaceful international environment in the region so that it

can focus on its domestic economic and political goals, which

will allow it gradually to build up its power resources.

Towards this end, the PRC has sought good, cooperative

relations with its neighbors, and supports the status quo in

the region. However, this support of the status quo does not

guarantee that China will remain satisfied with it over the

long-term. Rather, it is a calculated and instrumental

support for the current situation based on Beijing’s current

needs and future goal of regional power.

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II. THE CHINESE THREAT IN THE FUTURE

China’s calculated support for the status quo is likely to

last for several more years, perhaps 5 to 10. After that, the

potential Chinese threat to its neighbors will probably begin

to increase. The nature of the increase and the exact timing

of this change depend to a large degree on the success of the

economic reform program and continued economic growth.

Two basic scenarios thus unfold, one based on the success of

these economic efforts and the other on their failure.

Scenario 1: Economic Success.

It is possible that China’s economic reforms will succeed

and that its economy will continue to grow strongly. Should

this happen, around the years 2020-25, we may envisage a

scenario whereby China will carry much economic weight in

the world. It may not have overtaken the United States as

the largest economy in the world, as has been forecast by

some analysts, but it will certainly be closing in on that

position. At the same time, the pursuit of economic success

will have driven China to become more economically

dependent on international trade. By 2020-25 one may

assume that it will be relying heavily on imported oil and

other energy sources (from both Central Asia and the

Middle East).

In this scenario, the Chinese will be dependent on trade

and imported energy. They will also have the enhanced

economic resources that will permit them to increase their

military capabilities. As a result, we may expect several

developments. The Chinese will likely increase their air and

naval capabilities for power projection and seek the ability

to keep the sea lanes through Southeast Asia open to

Chinese trade and energy imports from the Middle East.

The PRC will pursue this goal to ensure that its economic

security is not disrupted by another power.

This would be particularly vital should conflict break out

in the Taiwan Straits. If the Taiwan issue has not been

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resolved to Beijing’s satisfaction, the PRC will need to

ensure that the United States cannot cut China’s economic

lifeline. The United States currently maintains freedom of

the seas through these sea lanes as a “collective good” for all

trading countries.20 Most of the countries of East Asia are

willing to enjoy this collective good. However, China will

want insurance against the possibility that it becomes an

excludable good. It will, therefore, develop the air and naval

capabilities (such as aircraft carriers) that will allow to keep

the sea routes open to Chinese trade and energy imports. Of

course, these same capabilities may also enable the Chinese

to threaten to close these same routes to other East Asian

trading states, such as Japan, South Korea, and Taiwan,

thereby threatening the security of these neighbors. U.S.

interests in the region would be similarly challenged.

In addition to developing military capabilities to ensure

continued trade and energy imports, China will likely take a

stronger interest in what happens in Indonesia, Malaysia,

and Singapore because of their location along the important

Strait of Malacca and other major Southeast Asian sea lines

of communication. Indonesia in particular could be of

strategic interest to the PRC based on its geographic

position astride the major Southeast Asian sea lanes as well

as its possession of oil and natural gas fields.

Having regimes in these countries that are friendly to

Beijing will become important to the PRC, and we could see

increasing intervention by the Chinese in the domestic

politics of these countries. This could become problematic

for the United States, especially if Islamic fundamentalists

gain control over Indonesia or Malaysia. The recent

historical record suggests that the Chinese would be much

better able than the United States to work with such

regimes. The PRC and the United States might well come to

disagree over whom they wanted to govern in these

countries. This would raise tensions more broadly between

these two countries. Even if nothing as drastic as this ever

happens, it is possible that the PRC will seek more actively

to shape the politics of the region. They may try to make

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sure that neighboring governments adopt policies that are

in keeping with Chinese interests. Great powers, whether

regional or global, have frequently tried to control the

policies of their neighbors in this way. This Chinese

interventionism could very well lead to threats against the

political regimes of some of its East Asian neighbors.

This interventionism could also affect other areas where

China will have increasingly strong interests, such as in

Central Asia and in the Middle East. Because countries in

these areas will be principal suppliers of China’s energy

needs, the PRC may find itself intervening to create or

maintain regimes that are more to its liking. Such activity

will pose a threat to some leaderships and states in these

two regions. It could also threaten U.S. as well as Russian

interests in these regions. In particular, the PRC might be

more willing to support nondemocratic regimes than the

United States would be, although our history suggests that

this might not necessarily be the case.

Finally, the power projection capabilities that China will

develop under this scenario will give it the ability to

threaten its East Asian neighbors in ways that it currently

lacks. In particular, these new capabilities could provide it

the ability to militarily resolve the Taiwan issue as well as

the dispute over the Spratly Islands—and the Senkaku

Islands for that matter. Certainly, China’s neighbors will

seek to enhance their own military capabilities as those of

China rise, and these countering actions may offset the

increased Chinese threat. But we could also get a regional

arms race that would aggravate tensions and

misperceptions. The fundamental point here is that the

continued rise of China will likely give it new interests and

new capabilities, and these could threaten the interests and

security of its East Asian neighbors.

Scenario 2: Economic Collapse.

A second possibility is that China’s economic reforms

and growth will stall or even collapse. This would likely

84
result in (and could also be caused in part by) internal

tumult. This could happen any time between now and 2020,

although the most likely date would be between 2005 and

2010. This is because at the moment the Chinese economy

seems to be continuing to make progress and seems to be in

no imminent danger of collapse. At the same time, if the

Chinese economy continues to prosper, it will be very strong

towards the end of this period and therefore less likely to be

vulnerable to collapse.

If economic collapse occurs, the Chinese Communist

Party will doubtless meet its demise. Since the start of the

reform period in late 1978, the basic source of legitimacy for

the Party has been its ability to produce economic benefits

for the country. The ideological basis of the Party’s rule,

which had been the foundation of its legitimacy, was

undermined by the pragmatic policy approach adopted by

Deng Xiaoping and the turn from a planned state-owned

economy to a heavily market-based economy led by the

private sector.

This fall of the Chinese Communist Party will not

necessarily lead to the rise of a democratic political system

in China. To the contrary we are most likely to see a new

authoritarian regime emerge, one based heavily on the

military as well as some of the former Communist Party

reformers and technocrats. This regime will likely resemble

the bureaucratic-authoritarian regimes of Latin America

and the authoritarian regimes that led Taiwan and South

Korea in the 1970s and early 1980s. It is also likely that

without an ideological basis for their legitimacy, and with

an economic crisis to cope with, the primary source of the

legitimacy of this leadership will be nationalism. This will

mean a heightened emphasis on defending national

sovereignty and territorial integrity against perceived

threats.

In such a situation, one of the big questions will relate to

the military leaders. If they come from the more hawkish

sections of the PLA, we could see a very serious security

85
threat emerge. First, it is highly likely that, in an attempt to

build up their power at home, this Chinese regime will seek

to make the West in general, and the United States in

particular, scapegoats for China’s problems. This is certain

to lead to increasing tensions between China and the United

States, and possibly Japan and other U.S. allies in the

region. Second, the authoritarian leaders of China will

likely increase their repression of human rights, thereby

exacerbating further the tensions between China and the

United States.

Third, such a China would certainly increase the

pressure on Taiwan to agree to rapid reunification, and

would likely use military threats to coerce the Taiwanese to

accept reunification in the very near future. This could

trigger military conflict in the Taiwan Strait, which would

draw in the United States and possibly also Japan (since the

United States would use its bases there for logistical and

other support of its activities in the Strait). Fourth, we

should expect to see similarly more assertive Chinese

claims to the Spratlys, the Senkaku Islands and other

territories. This stronger Chinese assertiveness would

increase the threat to China’s regional neighbors. Finally,

China might try more aggressively to support opponents of

the U.S. around the globe in an effort to reduce U.S.

influence and hegemony. This could come in the form of

arms sales to opponents of the United States in the Middle

East or other regions.

There is a silver lining to this dark cloud, however. The

China envisaged in this second scenario would not be as

capable of threatening its neighbors, or U.S. interests in the

region, as would the China of the first scenario. If China

collapses economically it will not have the resources to

pump into the military. If the collapse takes place around

2005 to 2010, as we think likely, China will not as yet have

developed the kind of deep power projection capabilities

that it might have well acquired by 2020-25. It might have

acquired one or two aircraft carriers, but these would not

necessarily be fully operational and integrated into the

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Chinese navy. It might have increased its nuclear weapons

and would certainly have built more ballistic and cruise

missiles with which to threaten its neighbors. However, the

lack of broader air and naval power projection capabilities

would limit the ability of China to challenge the security of

its East Asian neighbors and the United States in the

region.

CONCLUSION

For the moment, China supports the status quo in East

Asia. It does not threaten any of its neighbors in the region,

save Taiwan and, to a lesser degree, those nations with

claims in the Spratly Islands. However, the Chinese support

the status quo because they believe that this will help them

accomplish their long range goal of achieving great power

status in the region not because they are satisfied with the

current situation. Moreover, this condition could change in

only a few years, perhaps as early as 2005-2010. As Chinese

economic power grows, so will its military power. As this

happens, Chinese interests are likely to change and it may

well become more of a threat to its neighbors and to U.S.

interests in the region. And if the Chinese economy fails

instead of succeeding, we are even more likely to see a

hostile China threatening its neighbors.

The two scenarios sketched out in this chapter suggest a

trade-off for the United States and the countries of East

Asia. In the first scenario, an economically successful China

will likely develop significant military capabilities by

2020-25. Thanks to these new capabilities it could seriously

threaten the security of most of its regional neighbors as

well as challenge U.S. interests in East Asia. The interests

that China would develop through its enhanced dependence

on international trade and energy imports could lead it into

conflict with its neighbors and the United States. The

question is how likely this is to occur. In the second scenario,

economic failure will more than likely lead to an aggressive

China as it seeks to blame its problems on others; this will

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be especially true if the military leaders in the regime come

from the more hawkish faction in the PLA. But while we will

see a more hostile and aggressive China in this case, it will

also be a less capable China, as it will not have had the time

and economic success to fully develop power projection

capabilities with which to threaten more than its immediate

neighbors.

Thus we are faced with two alternative possibilities. On

the one hand, we may be faced by a China which experiences

economic failure and which is less capable, but more hostile

in the near term. On the other hand, we may be faced by a

China which continues to enjoy economic success, and

which is more capable, but perhaps, in the long term, less

aggressive.21 The current policies of East Asian countries as

well as the United States seem to prefer the latter. The hope

is that this aggressiveness will be diminished and tamed as

China is involved in international organizations, as

economic interdependence between China and its neighbors

grows, and as the possibility of democratization in China is

realized. We will have to wait to see whether these factors

have the desired effects.

What will the rise of China and its increasing threat

mean for the U.S.-constructed system of alliances in East

Asia? Some analysts are concerned lest countries in the

region accommodate themselves to Chinese interests to the

detriment of the interests of the United States, especially as

Chinese pressure is likely to increase as it asserts itself as

the regional great power. So long as the United States

remains engaged and committed to the region, Chinese

pressure should not break these alliances apart. Balancing

behavior will predominate over bandwagoning, so long as

the smaller states in the region have a credible

counterbalance to China.22 But if the U.S. commitment to

the region becomes uncertain, Chinese pressure on regional

states may well lead them to accommodate Chinese

interests. This is more likely to be the case for the smaller

countries in the region and for those more immediately on

China’s borders.

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This has important implications for U.S. defense

strategy in the region. There are some analysts who believe

the United States should reduce or eliminate our troop

presence in East Asia, relying instead on high-tech,

long-range weaponry and missile defense systems to cope

with security threats there.23 If we were to do this, it would

reduce our presence in the region and seriously undermine

our credibility as an ally for several of the regional

countries, thereby leaving them more vulnerable to Chinese

pressures. We could then see regional states bandwagoning

with China, rather than following their preference to

balance against Chinese pressures. This could lead to the

erosion of our regional alliance network. The best way to

limit the spread of Chinese influence in the region will

continue to be the maintenance of a strong and active U.S.

presence in East Asia.

ENDNOTES - CHAPTER 4

1. This official budget greatly underrepresents the true size of the

PLA’s actual budget, with some analysts estimating that the actual

budget is anywhere from three to ten times the official figure. See

Institute for International and Strategic Studies (IISS), The Military

Balance, 2000-2001, London: Oxford University Press for IISS, 2000, p.

183; and Richard Bernstein and Ross H. Munro, “The Coming Conflict

with America,”Foreign Affairs, Vol. 76, No. 2, March/April 1997, p. 25.

2. See Gerald Segal, “Does China Matter?” Foreign Affairs, Vol. 78,

No. 5, September/October 1999; Robert S. Ross, “Beijing as a

Conservative Power,”Foreign Affairs, Vol. 76, No. 2, March/April 1997.

3. On the PLA’s current capabilities and modernization program,

see IISS, The Military Balance, 2000-2001, pp. 183, 186-187, 194-197;

and Zalmay M. Khalilzad, et al., The United States and a Rising China:

Strategic and Military Implications, Santa Monica, CA: Rand

Corporation, 1999, Chapter 3.

4. The Military Balance, 2000-2001, pp. 179, 194.

5. IISS, The Military Balance, 2000-2001, p. 194; Khalilzad, et al.,

The United States and a Rising China, Table 3.1, p. 43.

89
6. See, for example, Willy Wo-Lap Lam, “Sowing Seeds of Rural

Discontent,” South China Morning Post, February 9, 2000, p. 13; as well

as reportage by Jasper Becker on demonstrations that appeared in the

South China Morning Post on May 14, August 30, November 16, and

December 14, 2000, and May 12, 2001.

7. For an example of these calls for vigilance, see “Top Party Official

Says Social Stability Continues as China’s Top Priority,” Xinhua News

Agency, Beijing, December 2, 1999, carried in BBC Summary of World

Broadcasts, Part 3 Asia-Pacific, Hong Kong, FE/D37809/G, December 4,

1999.

8. See Reuters, “Thai Falun Gong Meeting Shelved after Pressure

from China,” carried in South China Morning Post on-line updates,

February 20, 2001; and John Martinkus, “Thailand’s Quiet

Crackdown,” South China Morning Post, March 8, 2001.

9. Ji Guoxing, “SLOC Security in the Asia Pacific,” Honolulu:

Asia-Pacific Center for Security Studies, Occasional Paper series,

February 2000, available at http://www.apcss.org/Paper_SLOC_

Occasional.htm, pp. 12-13.

10. In December 2000, Taiwan announced the creation of the “mini

three links” legalizing trade and travel from the Taiwan-controlled

off-shore islands to the mainland; the PRC consented to the

establishment of these linkages. In mid-May 2001, Beijing hosted a visit

by former Taiwanese Premier Vincent Siew during which he lobbied for

the creation of a common market between the PRC and Taiwan.

11. See BBC Summary of World Broadcasts, April 6, 1998, Part 3

Asia-Pacific; ASEM Summit in London; China; FE/D3194/S1.

12. Sino-South Korean trade hit U.S.$34 billion in 2000, a 40

percent increase over 1999 and a ten-fold increase since the

normalization of diplomatic relations in 1992. See Scott Snyder,

“Consummating ‘Full-Scale Cooperative Partnership’,” Comparative

Connections: An E-Journal on East Asian Bilateral Relations,

December 2000, available at http://www.csis.org/pacfor/cc/

004Qchina_skorea.html.

13. On this issue, see the quarterly chronologies by James J.

Pryzstup in Comparative Connections, July 2000-April 2001, available

at http://www.csis.org/pacfor/cc/archive.html.

90
14. U.S. Information Agency: Foreign Media Daily Digest, edited

Kathleen I. Brahney, October 6, 1997, available at

http://www.fas.org/news/japan/97100601_rmr.html.

15. The Military Balance, 2000-2001, p. 181.

16. The photo was published with Reuters, “Vietnam Says

Archeology Proves Its Claim to Spratly Islands,” in South China

Morning Post, on-line version, February 16, 2001.

17. Carlyle A. Thayer, “ASEAN Ten Plus Three: An Evolving East

Asian Community?” Comparative Connections, January 2001, available

at http://www.csis.org/pacfor/cc/004Qchina_asean.html.

18. For an analysis of the PLA Navy’s interests in exerting control

over the Spratlys, see John W. Garver, “China’s Push Through the

South China Sea: The Interaction of Bureaucratic and National

Interests,”The China Quarterly, No. 132, December 1992, pp. 999-1028.

19. See Reuters, “India, China to Conduct Joint Navy Exercises,”

South China Morning Post, on-line updates, May 24, 2001.

20. I would like to thank Susan Shirk for this observation, which has

forced me to clarify my thinking on this point.

21. I would like to thank Steven Biddle, University of North

Carolina-Chapel Hill, for helping me clarify this point in my argument.

22. For a discussion of the conditions under which balancing and

bandwagoning behavior will occur, see Stephen M. Walt, The Origins of

Alliances, Ithaca, NY: Cornell University Press, 1987, Chapter 2.

23. This suggestion was made in an early draft of the quadrennial

defense strategy review conducted in 2001. See Michael R. Gordon,

“Pentagon Review Puts Emphasis on Long-Range Arms in Pacific,” New

York Times, May 17, 2001. Ted Galen Carpenter has made a similar

suggestion, although he advocated relying on a new regional balance of

power to replace the old alliance network and troop deployments. See

his “Washington’s Smothering Strategy: American Interests in East

Asia,” World Policy Journal, Winter 1997/98.

91
92
Part III.

ASIAN GREAT POWERS

93
CHAPTER 5

ASSESSING INDIA’S RESPONSE TO THE RISE

OF CHINA:

FEARS AND MISGIVINGS

Sumit Ganguly

INTRODUCTION

This chapter will focus on India’s responses to the rise of

China. By the rise of China, I mean the growth of Chinese

military and economic power and the increasing power of

the Chinese state (though clearly, whether or not the power

of the Chinese state is, in fact, increasing, is a matter of

some debate.) I speak of responses (plural) advisedly,

because there is no single Indian response to the rise of

China. Rather, there are many responses. India is, after all

a very messy, cacophonous democracy, and likely to remain

so. As one might expect in a pluralist society, different

interest groups or congeries of interest groups have very

different reactions to the rise of China. My intention is to

spell out three distinct perspectives. For analytic purposes I

have tried to make them three discrete analytic frameworks

or foci, though you will notice that there is some degree of

overlap among these views. Broadly speaking, there are

those who appease and muddle through, those who advocate

strategic engagement, and those who take a confrontational

approach.

Some Indians belong to what can best be called the

“Appeasement and Muddling Through School.” Their

defining traits are a desire to appease China and an ad hoc

way of responding to crises, whether we are looking at the

sale of Chinese ballistic missiles to Pakistan, problems on

95
the Sino-Indian border, or trouble with the Tibetans. The

second group (which broadly speaking includes the present

government in New Delhi) advocates a “Policy of Strategic

Engagement” with China. In essence this policy involves

keeping one’s powder dry and holding the feet of the Chinese

to the fire, while at the same time, cautiously recognizing

that there are areas of potential cooperation. Finally, a third

group is emerging in India. This group is gathering some

momentum, though its influence on policy at this point is

limited. I call this group the “Confrontationalist School.”

Members of this group say that India should bristle with

missiles, that India should ratchet up its ballistic missile

and its nuclear weapons programs, and otherwise, as it

were, “take the Chinese on.”

At this point, we should consider each of these schools in

turn and, after taking a closer look at the world-views they

espouse, ask ourselves some questions? Who belongs to

these schools? Who are their partners? Where do they stand

in the Indian political spectrum? Whence do their ideas

stem? What impact are they likely to have on future Indian

policy?

I. APPEASEMENT AND MUDDLING THROUGH

The appeasement and muddling through group includes

Congress. By Congress, I mean the Indian National

Congress Party, now a mere shadow of its former self.

Congress is the party that brought India independence. It is

the party of Jawarharlal Nehru, India’s first prime minister

and essentially the architect of modern India’s foreign

policy. The permanent bureaucracy of India—the Ministry

of External Affairs (MEA)—in good measure also shares the

perspective of Congress on China.

The perspective of this group is in large part based upon

fear and awe of China. This fear in turn largely stems from

the traumatic experience of the 1962 border war. This war

may well be a scratch on the minds of most China-watchers,

but we should not underestimate what it means to Indians.

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From the perspective of Indian strategists and Indian

security analysts, the 1962 border war is a watershed event,

perhaps the most significant event to take place between

1947 and the present date. They see it as more important

than either the Indian nuclear tests of 1998 or the 1971

victory over Pakistan. Indian defense strategy, foreign

policy, and security planning were fundamentally altered

by the war of 1961.

The traumatizing impact of 1962 still pervades the

thinking of much of the Indian foreign policy bureaucracy.

They see China as something larger than a mere bête

noire—or, more aptly, bête jaune. They are absolutely

terrified of China. As a result, they are convinced that it is

vital to accommodate the Chinese. They try as far as

possible to oblige China and avoid rocking the boat. They

periodically beat up Tibetans in India. They do this

especially—and with considerable vigor—when Li Peng is

in town.1 They reiterate at every official function that Tibet

is an autonomous part of China and do not get any

commensurate statement from the Chinese on India’s

vexing problem in Kashmir. In short, the policy of this

school involves genuflection before the Middle Kingdom.

Fear of China, which drives the approach of this school,

has been reinforced in the last 10 to 15 years by the

phenomenal growth of the Chinese economy. Those Indians

who belong to this group envy the growth of Chinese

economic power. They envy the fact that the Chinese have

made significant progress towards eradicating rural

poverty. Congress, their foreign policy authorities and, in

particular, the permanent bureaucracy, feel besieged and

threatened. They feel that India is in an acutely vulnerable

state. They think that India can ill afford to do anything to

provoke this extraordinarily economically and militarily

powerful state that just lies beyond the Himalayan

mountains, mountains which proved, contrary to Nehru’s

view, unable to protect India in perpetuity.

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The Ministry of External Affairs and Congress pursue a

largely unimaginative set of policies. They also lack a clear

sense of strategic objectives. They do not seem to know what

they ultimately want from the Chinese. They have no sense

of an end game, which is why I refer to this group as the

“Muddling Through” group. This quality is especially visible

in the Sino-Indian border talks. These have been going on

since 1981. Entire careers have been built on the border

talks. And yet participants do not seem to have the any idea

at all of what they finally hope to achieve.

Rank anti-Americanism is also a feature of this

world-view. Members of the “Appeasement” school want to

oppose the sole remaining superpower. They believe that

India, China, and possibly Russia can make common cause

against America. They think that an alliance of this sort

would enable them to challenge global regimes over a

number of issues, including international climate change,

human rights, sovereignty, and global trade. They also harp

at great length on the importance of multipolarity. The

members of this school are easily consumed by the logic (or

rather illogic) of their own rhetoric. They are, for example,

easily taken in by the occasional Chinese statements to the

effect that India should be included in a multipolar

universe. They are quick to believe this, despite the fact that

important differences continue to separate India and China

on all substantive issues.

II. STRATEGIC ENGAGEMENT

The current government is a coalition government

dominated by the Bharatiya Janata Party (BJP) party. This

party is rather jingoistic, and is often referred to, quite

correctly in my view, as a Hindu Nationalist party. The

position of this party and its coalition partners (to the extent

that the coalition partners have any interest in foreign

policy and, particularly, in China) is one of strategic

engagement. This approach requires India to build up its

own military and economic might.

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I have argued in other articles that India is finally

becoming a “normal” state, that is to say a state that

recognizes the utility of force in international politics.

Indians no longer use the namby-pamby language of

universal nuclear disarmament. If they do, it does not

derive from any real conviction; no one in their right mind in

New Delhi really believes that such a goal is desirable or

attainable. The Nehruvian/Wilsonian vision of the world is

increasingly being tossed aside. Instead it is coming to be

replaced by a view that force in and of itself and forces in

being both constitute very important elements of national

power. The use of force, moreover, involves the use of force

well beyond South Asia.

The recognition of the importance of force came

belatedly to India but is finally sinking in and taking very

deep roots. To be sure, some analysts point to the Indian use

of force to liberate Goa from Portuguese rule in 1961.2 They

say that this shows that Indians abandoned the ideational

view of the world many decades ago. However, this is simply

not true. Goa was a colonial enclave. Colonialism had been

discredited, and the Portuguese had to go. India had

negotiated with the Portuguese in good faith and to no avail.

The Goans were utterly intransigent, and the use of force

was India’s only remaining option.3 The fact is that the

invasion of Goa was only a minor episode and should be seen

as a departure from the norm. Indians did not seriously

consider the utility of force until recent times. Today all that

is changing.

A fundamental change is taking place in other areas as

well, notably in economics.4 Members of the current regime

emphasize the need to for India to develop its economic

might. They are eager to catch up with China although

aware how far the Indian economy lags behind that of the

Chinese, particularly in the area of attracting foreign

investments. They argue that the economic liberalization

program must continue because, since 1991, it has yielded

rich results. India has, at long last, broken out of what the

eminent Indian economist Raj Krishna used to call the

99
“Hindu” (as opposed to the secular) rate of growth. For many

years, all India could hope for was an effective growth of

about 1 percent a year thanks to the fact that its 3 percent

growth in gross national product (GNP) was paralleled by

an annual 2 percent population growth. Now the Indian

economy is enjoying a steady growth of 6 percent. If this

growth were to increase to 7 percent per annum and keep at

that level for 10 years, the national income would be

doubled by 2011. That is the talismanic figure that Indians

are aiming for. Indian economists are now suggesting that

double digit growth might be possible provided that they

can find ways to deal with such exogenous shocks as hikes in

oil prices. In all, the members of this party both recognize

that much needs to be done, but at the same time are eager

to catch up with Chinese economic might.

Strategic Engagement also calls for improved relations

with Southeast Asia, a part of the world long neglected in

Indian Foreign Policy. India has increased its presence in

Burma (note the visit to this country by foreign minister

Jaswan Singh); demonstrated a willingness to cooperate

with Malaysia (upgrading its aircraft and assisting its

airforce); signed a security pact in Indonesia; held naval

exercises in the recent past with Vietnam; and sent naval

vessels to visit Japan. All this represents, no pun intended,

a sea change.

At the same time, strategic engagement does not simply

call for the use of force and the development of Indian

military might. It also calls for a continuing dialogue with

China. The current government appreciates the need to

engage in discussion with the Chinese. There are some

serious areas of contention between India and China such

as the border problem, the supply of ballistic weapons and

nuclear weapons technology to Pakistan, and most recently

the alleged dumping of cheap Chinese goods in the Indian

market. Whereas previous regimes would have simply

swept these things under the carpet, the BJP, for all of its

flaws, is forthrightly confronting these issues.

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Related to this is one last component of this perspective

or strategy. The current government does recognize

potential areas of cooperation between India and China.

Most notable is its attempt to wean China away from

Pakistan by emphasizing an issue that is of common

concern, namely the rise of radical Islam. Of course, when

the BJP talks about the rise of radical Islam, one has to take

it with not only a few pinches of salt but also an entire

saltshaker full of salt! However, the Chinese are now facing

a problem from radical Muslims in Xinjiang.5 Consequently,

this line of argument sells well. The Indians can try to

convince the powerful Chinese that the Chinese alliance (or,

more accurately, their “client relationship”) with Pakistan

is not serving them very well any more. They can point out

that the Pakistanis are in bed with the Taliban who have

obvious connections with Islamic zealots in Central Asia.

They can suggest to the Chinese that, under these

circumstances, it might be in their best interest to

recalculate their options vis-à-vis the Pakistanis. Indeed,

they might be advised, to make common cause with the

Indians against “Islamic terror.”

III. THE CONFRONTATIONALISTS

Finally, we come to the lunatic fringe, namely the

Confrontationalists. Fortunately, they also constitute the

weakest of the three positions in the Indian political

spectrum. What exactly do these Indians have in mind? It

can be summed up in one word as “confrontation.” They call

for a policy of unremitting hostility towards the People’s

Republic of China. They believe that India should adopt a

far more confrontational stand towards China. They argue

that India should dramatically expand the scope of its

nuclear weapons program and expand the reach of its

ballistic missiles. India should, moreover, adopt a far, far

tougher negotiating stance on the border question. Indians

should try to obtain Chinese acquiescence on the Kashmir

issue with Pakistan. If the Chinese do not prove to be

tractable, Indians should exploit the Achilles heel of the

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Chinese: Tibet. Tibet, the confrontationalists stress,

constitutes the soft underbelly of China. India should take

advantage of that soft underbelly, kick the Chinese where it

hurts. If the Chinese do not prove to be tractable on the

border question or on the Kashmir question, Indians should

remind them that they can raise the cost in Tibet. They have

done this before and are prepared to do it again. At the very

least, the confrontationalists say, the Tibetans are getting

restive, and this is a good time to try and milk the situation

to their advantage.

Interestingly enough, some members of this group are

also viscerally anti-American but in spite of their viscerally

anti-American position, they nevertheless feel that they can

make common cause with the United States. Certain

(unnamed) senators and representatives in the United

States have made remarks about how India could serve as a

possible counterweight to China. Such remarks have

animated this group of Indians even further, leading them

to think that India might be able to make common cause

with the United States and tie China down. Even though

the confrontationalists are angered by American sanctions

against Indian nuclear power, they see this area as one

where their interests do dovetail.

IV. THE FUTURE

The future hinges, in my estimate, on three important

factors.6 First, it depends on who is in power. Should the

BJP regime collapse and were Congress or a variant of

Congress to return to power, we would once again see a

policy of appeasement and muddling through. This is the

only policy that the so-called foreign policy experts in

Congress know how to pursue.7 This is because they are

unimaginative, because they are absolutely terrified of

China and because they do not recognize India’s inherent

strengths but only see its vulnerabilities. It is above all

because they are still locked in a Nehruvian prism or rather

one should say “prison,” since they are certainly shackled by

102
what William Blake would call “mind-forged manacles.” I do

not think, however, that there is any imminent danger of a

collapse of the present regime.

Second, the future hinges on how the Sino-Pakistani

relationship evolves. Relations between India and China

could improve significantly should China, by some miracle,

be weaned away from Pakistan. The ballistic missile issue,

the Kashmir issue, and the nuclear issue, are all key here.

In this eventuality, in my estimation, a number of

differences could be settled. However, I think that such a

development is highly unlikely in the foreseeable future.

Third, and finally, nuclear developments will affect the

future of Indian-Chinese relations. Much depends on how

the Chinese react to the growth of Indian nuclear and

ballistic missile programs and, by the same token, how the

Chinese develop their nuclear and ballistic missile

capabilities. This in its turn is likely to be affected by

American talk of deploying missile defense systems. If

America proceeds with its Strategic Defense Initiative

(SDI), will the Chinese respond by carrying through further

modernization of their own nuclear forces? Will they expand

the scope and capabilities of their weapons? If they do, this

will provide ammunition for those in India who want to see

an expansion of the ballistic and nuclear weapons

programs. It will do so regardless of whether or not these

expanded forces are targeted on India or are even capable of

being targeted on India. The lunatic fringe will point out

that the Chinese are modernizing. They will remind us that,

to quote American realists, it is not intentions but

capabilities that matter. If it is good for the Americans, they

will say, it is good for us. Nuclear weapons can be brought to

bear on us and can be used to coerce us.8 Of course the

lunatic fringe still remains fairly small and a fringe.

However, that too, may change.

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ENDNOTES - CHAPTER 5

1. Li Peng visited India between January 9-17, 2001. It was part of

an effort on the part of the two Asian nations to try and repair frayed

relations. Li Peng, a former prime minister and current number two in

the Chinese hierarchy, is the chairman of the National People’s

Congress.

2. After the British left India, the Portuguese refused to give up

their colonies. After years of negotiation, in late 1961, the Indian

government deployed its armed forces in an effort to evict the

Portuguese from Goa and other Enclaves. Portuguese Governor,

Manuel Anonia Vassalo De Silva, signed the surrender document on

December 19, 1961.

3. See, for example, Arthur Rubinoff, India’s Use of Force in Goa,

Bombay: Popular Prakashan, 1971.

4. On the Indian economy, see T. N. Srinivasan, Eight Lectures on

India’s Economic Reforms, New Delhi: Oxford University Press, 2000.

5. China’s troubled western Xinjiang region borders Kazakhstan.

On radical Islam, see Dru C. Gladney, Muslim Chinese: Ethnic

Nationalism in the People’s Republic, Cambridge: Council on East Asian

Studies, 1996.

6. See especially John W. Garver, Protracted Contest: Sino-Indian

Rivalry in the Twentieth Century, Seattle: University of Washington

Press, 2001.

7. I am personally acquainted with every one of them and so speak

here from personal experience.

8. Ashley J. Tellis, India’s Emerging Nuclear Posture: Between

Recessed Deterrent and Ready Arsenal, Santa Monica: Rand, 2001.

104
CHAPTER 6

CHINESE PERCEPTIONS OF INDIA:

BRIEF COMMENTS

Susan Shirk

This chapter will offer a few brief comments on Chinese

perceptions of India. Sumit Ganguly and I are currently

involved in a study project on Sino-Indian relations

sponsored by the Asia Society, and will be travelling

together to India and China this summer, so the topic is very

much on my mind. Three years ago in the fall of 1998, I was

sent to India by the State Department to talk about China.

It was a very interesting experience to be an American

official coming to New Delhi and Mumbai (Bombay) to talk

about China right after the Indian nuclear tests. My

impression at the time, and my reaction today listening to

Dr. Ganguly discuss Indian views of China, is how very

different are Chinese and Indian attitudes toward the world

and toward one another.

My first reaction was one of surprise. Indian

international attitudes reminded me of those of the Chinese

10 or 15 years ago. They combined anti-Americanism with

resentment against global regimes. These feelings were

intense. China, by contrast, had come to see its interests as

more aligned with those of the international regimes. I had

never before realized the extent to which China had started

to become a status quo power.

My second observation was to note how similar Indian

attitudes towards Chinese economic success were to those of

Americans towards the Japanese a decade ago. While in

Mumbai, I had a fascinating discussion with some Indian

105
businessmen. Their view of China was one of admiration

and envy. They did not simply envy China’s position as an

openly acknowledged nuclear power. They also envied its

economic success. They admired and resented the fact that

Indian markets were being deluged with Chinese exports

and that this was making things very difficult for Indian

industry. When they visited China to see for themselves,

they said they were impressed by the designs of the new

plants, by the hardworking and disciplined Chinese

workers, and by the willingness of the Chinese people to

work for so little money and live in houses that were little

more than rabbit hutches. The kind of language they used

was just like the language we in the United States used in

the early 1980s and 1990s when we were feeling challenged

by the powerhouse of the Japanese economy.

Chinese reactions to India are very different from those

of India to China. China has a very pragmatic foreign policy.

The response of the Chinese to the Indian nuclear tests of

1998 illustrates this asymmetry.

For a decade after the 1962 war between India and

China, relations between the two countries can best be

described as that of a hostile standoff. Beginning in 1979,

however, some years before the end of the cold war, China

started to try and build better relations with India. The new

initiatives were stimulated by Chinese domestic

development strategy. When Deng Xiaoping embarked

upon these very ambitious Chinese economic reforms, he

also embarked on an omni-directional Chinese foreign

policy designed to improve relations with all of China’s

neighbors. The goal was to resolve border disputes and

develop friendly relations with all of China’s neighbors so

that friction between them would not hamper Chinese

progress. The improvement of relations with India was

basically part of that effort.

The Chinese diplomatic initiative towards India,

although motivated more by the shift in China’s domestic

development strategy than by international factors, was

106
reinforced by the disappearance of the Soviet threat and

Cold War alignments. In 1997 and 1998, before the nuclear

tests, then Chinese Foreign Minister Qian Qichen and

American Secretary of State Madeleine Albright always set

time aside during their meetings to have some “strategic

dialogue.” During this time, they got beyond the highly

contentious bilateral issues of Taiwan, nonproliferation,

and human rights to discuss informally various foreign

policy situations of common concern. Whereas Americans

tended to want to talk about Korea, the Chinese often

turned the subject to India and South Asia. Qian Qichen

said that the Chinese were trying to develop a more

balanced set of relationships with the countries on the

South Asian subcontinent. He implied that China and

America had become involved with Pakistan during the

Cold War largely because the Soviet Union had developed a

close relationship with India. China and the United States

were both undertaking to disinvest from Pakistan and

improve relations with India and so there was quite a lot of

common ground here.

So, in 1998 China was engaged in a diplomatic effort to

improve relations with India. In the Spring of 1998, Chief of

General Staff of the People’s Liberation Army of China Fu

Quanyou visited India. Just after he left and before he even

made it back to Beijing—he went on to tour a few other

countries in Europe—Indian Defense Minister George

Fernandez started talking about China as the number one

threat to India, and, a few days later, India tested its

nuclear weapons.

What was China’s reaction? To begin with, it was quite

mild. Then, however, the Chinese found out that Prime

Minister Vajpai had written a letter to President Clinton

blaming the tests on the fact that India was threatened by

the giant neighbor to the north—China. At this point China

had to speak up. It criticized the tests and defended itself

against the charge that the Chinese were ultimately to

blame for the Indian tests. From China’s perspective, India

had behaved in a provocative fashion; it had tested nuclear

107
weapons, and had pointed the finger of blame at China, and

it did so hard on the heels of a visit by the Chinese Chief of

General Staff.

I am struck by the way in which China turned the other

cheek and how pragmatic its response was. What it did, first

of all, was defend itself, rhetorically. Then it joined with the

United States in an attempt to develop a concerted response

to try to persuade the Pakistanis not to react by testing their

own nuclear weapons. This was a lost cause, but the Chinese

did try (as did we). Then the Chinese joined us in at a

meeting of the five permanent members of the United

Nations (U.N.) Security Council in Geneva in an effort to

prevent a nuclear arms race. They helped to determine a

series of benchmarks that both India and Pakistan should

strive to achieve in order to prevent a nuclear arms race in

South Asia and to preserve the international nuclear

nonproliferation regime. This was a highly responsible,

multilateral response on China’s part. Washington and

Beijing worked things out in a series of phone calls between

Secretary Albright and the new Minister of Foreign Affairs,

Tang Jiaxuan.

During this first phase, the persons in the Chinese

Ministry of Foreign Affairs (MFA) in charge of arms control

and relations with the United States took the lead, not the

Asia Department. They took advantage of the opportunity

to highlight China’s sense of responsibility toward the

international arms control and non-proliferation regime

and to expand cooperation with the United States on the eve

of President Clinton’s June state visit to China. By July,

however, the regional bureau in the Chinese Foreign

Ministry regained control of the India policy process. Not

surprisingly they wanted to resume the diplomatic

initiatives that they had begun before the nuclear tests.

Within a matter of months, they were engaged in pre-talks

for the next round of the strategic border talks, and other

diplomatic meetings were back on track. Of course, the MFA

arms control bureau and the People’s Liberation Army did

needle us quite a bit, claiming that we vacillated on the

108
Indian nuclear program. They said that we were

acquiescing to India’s nuclear status and they objected to

the fact that President Clinton went to visit India. Of

course, the Chinese were doing exactly the same thing. The

fact is that both the Chinese and we had more at stake in

relations with India than just nonproliferation. We did not

want to cut the Indians off simply because of the nuclear

tests.

Has there been any shift in Chinese strategic or military

posture in response to the Indian nuclear tests? As far as I

can tell there has been none. The strategic focus of Chinese

military and strategic planning continues to be (1) Taiwan,

and (2) the South China Sea. Their major concern is that

they have to be prepared to engage against the United

States in a Taiwan contingency. India is no more viewed as a

threat today than it was before the May 1998 tests. The

Chinese have, in fact, been factoring in India’s nuclear

capabilities since the initial tests in 1974. They see nothing

new about a second round of tests. If India actually

weaponized and deployed its nuclear weapons, this might

result in a new calculation. China might feel the need to

reassess the situation and defend itself against the danger.

At present, however, the Chinese really do not see India as

any kind of strategic threat to China.

Pragmatic diplomacy seems to characterize the Chinese

style of diplomacy toward all its Asian neighbors save

Taiwan and Japan. We can see it in Chinese policies toward

Korea and South East Asia, and, as we have seen, toward

India. This is why China’s Asian neighbors do not

necessarily see the growth of Chinese power as a problem

for them. They recognize China’s importance on the

regional scene. They realize that they must take Chinese

power into account and perhaps even defer to it. However,

they do not see Chinese power as a threat to their own

security.

If we perceive China’s increasing power as a threat to our

position in the region, this perception would be almost

109
unique. We do have cause to be concerned. After all, Taiwan

is China’s one blind spot. However, we should be aware that

China’s Asian neighbors, with the exception of Japan, do not

share our view.

A final point should be made. China has for several

decades had a close alliance-type relationship to Pakistan,

but over time it is reducing its commitments to Pakistan. It

has done so partly in order to accommodate the United

States, which objects to transfers of missile technology;

partly because it sees its own foreign policy interests in

having a more balanced set of relationships on the

sub-continent; and partly because it is very worried about

radical Islamic terrorism and the inability of an internally

disintegrating Pakistan to control it. Over the past 5 years

or so, China has been exercising much more caution and

restraint in its transfers to Pakistan. In 1997 it committed

to cutting off all cooperation with unsafeguarded nuclear

facilities in Pakistan. By and large, we believe they have

lived up to that commitment. Over the past couple of years,

moreover, the Chinese have also started to disinvest on the

missile technology side. In November 2000 they agreed to

cut off missile technology exports to Pakistan. They also

agreed to put in place export controls including dual use

items. In short, while some degree of support for Pakistan

continues and will continue in the future, it is obvious that

the Chinese are lowering the profile of their relationship

with this country.

110
CHAPTER 7

HISTORICAL IRONIES, DIVIDING

IDEOLOGIES

AND ACCIDENTAL AALLIANCE@:

RUSSIANBCHINESE RELATIONS

INTO THE 21st CENTURY

Yu Bin

INTRODUCTION

In terms of both power and ideology, Russia, perhaps

more than any other country, has good reason to see the rise

of China as a threat. The historical decline of Russia and the

steady rise of China in the past 20 years have been

accompanied by a growing gap between the domestic

political systems of the two nations. At the turn of the

millennium, however, Sino-Russian relations are perhaps

more equal and more mutually beneficial than they have

been at any other time during the past 300 years.1

There are a number of visible indicators of this more

mature bilateral relationship. Despite fluid internal and

external environments, the relationship between Russia

and China is relatively stable. High level exchanges have

been taking place, with top officials frequenting each other=s

capital on a regular basis. There is now a busy and

profitable border trade along what was once the longest

fortified peacetime border. Whereas Russia and China used

to stand on the brink of nuclear war, with Russia prepared

to launch a nuclear strike against China, now China and

Russia have mutually pledged not to use nuclear weapons

against one another. This is especially striking in that

111
Russia recently dropped its no-first-use policy towards

other countries. In July 2001, the two countries signed a

major and comprehensive friendship treaty, 30 years after

the first one expired on February 14, 1980.

At least three factors contributed to these ironic

changes. First, the changes have been against the backdrop

of centuries of difficult and complex Sino-Russian relations.

Second, China’s historical rise and Russia’s unprecedented

peacetime decline during the last decade of the 20th century

resulted in a structural equilibrium. Finally, the post-Cold

War “chill” has driven the two powers together in spite of a

growing gap in their domestic politics.

I. THE AGONY OF HISTORY

On July 19, 2000, the young (only in relative terms)

Russian President Vladimir Putin attended a 36-hour

“working summit” in Beijing. While the former KGB colonel

was amazed by the glamour and luxury of the Forbidden

City, he was probably well aware that, a century before,

Russian soldiers had helped quell the xenophobic Boxer

rebellion of 1899 and, along with seven other powers, had

participated in the subsequent looting and burning of the

city.

The role Russia played in the suppression of the Boxer

Rebellion was but the culmination of several centuries of

intrusion into China. This intrusion was in some ways

different from those of other European powers. For

example, the widely publicized Opium Wars of the 1840s

fought by Britain against China were fought in densely

populated areas and were effectively resisted. Russia’s

advance into China, by contrast, took it into the sparsely

populated region of Asian Siberia. It was, therefore, not

effectively resisted by China nor did it create an immediate

conflict of interest with other powers.

Moreover, Russia had its own reasons for expanding into

Asia at China’s expense. As a Eurasian power, the Russians

112
believed that they could alleviate their enduring inferiority

complex in relations with Europe by demonstrating

Russia=s superiority in Asia. As a Russian diplomat once

noted:

In Europe we were hangers-on and slaves, whereas we

shall go to Asia as masters. In Europe we were Asiatic,

whereas in Asia, too, Europeans... Since, in truth, to us

Asia is like the then undiscovered America, with our

aspiration for Asia, our spirit and force will be

regenerated.2

Russian persistent encroachment upon China’s

territorial integrity during the 18th and 19th centuries was

checked in the early 20th century. The halt to Russian

expansion took place, ironically, not because of successful

Chinese resistance, but because of Japan’s victory in the

Russo-Japanese War of 1904-05 and because of subsequent

revolutionary developments within Russia itself.

Russian expansion into China was a long and tragic

experience for China, which helped shape its modern

history. But Russia, in fact, has done far more than this to

influence its Asian neighbor. It has, indeed, been a catalyst

for many far-reaching changes in China’s internal and

external politics. Perhaps most significant of all is the role

played by Russia in bringing about the Chinese embrace of

socialism.

In the early 20th century, Russian Bolshevism, which

promised a unilateral end to Russia’s extraterritorial

privileges in China, appealed to many nationalistic Chinese

intellectual elites. It offered an attractive ideological and

modernization alternative to the Western imperialism that

blatantly threatened China’s sovereignty and territorial

integrity. In addition, the Chinese were drawn to Marxism

out of unrequited love for Western liberalism. Prior to 1919,

young and influential Chinese intellectuals had been very

much drawn to “Mr. Democracy” and “Mr. Science.” But

Chinese interests were ignored and violated at the Treaty of

Versailles.

113
Despite their shared ideology, Soviet and Chinese

communists never got along well. This mistrust was a major

factor in Chinese ambivalence towards the outside world.

Stalin never fully trusted Mao3 and Russia=s support for the

Chinese Communist Party (CCP) during World War II was

almost nonexistent. In August 1945, the Red Army defeated

the one million-strong Japanese Guandong Army in

Manchuria in a few weeks. It nevertheless stayed for

another 2 months to dismantle Manchuria=s industrial

facilities and ship them back to Russia.

The Korean War seemed to cement Moscow-Beijing

relations. But Chinese leaders felt outmaneuvered and even

betrayed by their Soviet counterparts throughout the

process. China was neither fully consulted nor fully

informed before the Soviet-North Korean decision to launch

the 1950 attack against the south.4 Moreover, China, which

suffered one million casualties during the 3-year war, had to

pay for most of the armaments provided by Moscow. Some

Chinese leaders later vowed that China would never be

dragged into another conflict in Korea.5

To be sure, the Sino-Soviet honeymoon in the 1950s

witnessed Athe most comprehensive technological transfer

in modern industrial history@ between any two states.

Moscow provided $2 billion in loans and assistance to

China. However, though timely, it was still only 40 percent

of the sum of money provided by the United States to

Taiwan during the same period.6

Mao himself was perhaps both the cause and result of

China’s ambivalence toward Russia. His own rise within the

CCP before 1949 was clearly at the expense of the

pro-Moscow “returned students.” Throughout his life, Mao

studied English, not Russian, and preferred a physician

educated in the West to one trained by Russia.7 China=s

Alean-to-one-side@ policy toward Moscow was a marriage of

necessity rather than an expression of genuine mutual trust

based on a shared ideology. Mao=s rejection of the Soviet

centralized approach in the late 1950s led to the most

114
devastating famine in China=s history (1959B61) and the

self-destruction of China=s entire political infrastructure

during the Cultural Revolution (1966B76).

The two communist giants experienced a rapid

downturn in their bilateral relations during the lifetime of

Mao. They moved from suspicion to open polemic, to

dramatic break in diplomatic ties in 1960, and finally to

military confrontation. Both sides committed enormous

resources to prepare for their own two-front war, which was

also a major factor in the failure of their respective national

economies. Indeed, during this period, Russia and China

engaged in a “zero-sum” game, which they likely came to

regret a few decades later in an America-dominated

unipolar world. From a systemic point of view, the

Sino-Soviet disputes ended the strictly bipolar system and

eventually led to the creation of the so-called strategic

triangle between Beijing, Washington, and Moscow.

Whatever the case may be, bilateral relations under Mao

oscillated between love and hate. They never achieved

normality.

It was during the reform decade of the 1980s in both

countries (under Deng Xiaoping and Gorbachev) that

pragmatism finally overcame ideological divides, and

Moscow and Beijing started to mend the much-damaged

relationship.

II. THE FATE OF TWO COMMUNIST STATES

In the 1990s unsettling and challenging domestic

developments quickly complicated relations between

Russia and China. Both countries changed dramatically in

this decade.

In China, the reform decade of the 1980s had created a

strong sense of uncertainty among both the members of the

elite and Chinese society in general. This led to the 1989

demonstration in Tiananmen Square and the government

crackdown that followed. Gorbachev’s visit to Beijing in

115
1989 was a historic moment and marked the start of the

normalization of Sino-Russian relations. However, this

same meeting also highlighted a growing ideological divide

between Gorbachev=s radical reforms and Deng Xiaoping=s

gradualist economic reforms. Almost overnight, Gorbachev

replaced Deng Xiaoping as the West=s Apet@ communist

reformer. The collapse of the Soviet Union considerably

reduced a direct threat to China’s national security.

However, at the same time it also exposed China to a

Western anti-communist crusade, whose brunt was to be

felt later.

Both Russia and China were, at the time, reforming

their countries. The reforms, however, were radically

different and had very different consequences. China’s

changes were part of a process of political consolidation,

following Mao’s romantic and chaotic social experiment.

Their net result was to lead to a build-up of Chinese power.

In contrast, Gorbachev=s unsuccessful reforms of glasnost

and perestroika led to more desperate moves in 1989 and

1990. These, in turn, started to undermine, though not

intentionally, the stability of the previously rock-solid

Soviet bureaucracy.

The differences between China and Russia which

resulted from Chinese buildup and Soviet breakdown were

reinforced and accelerated by developments in civil-military

relations in the two countries. During the reform period, the

People=s Liberation Army (PLA) was in the process of

becoming more professional and less political. (The

intervention in politics by the Chinese military in 1989 [The

Tiananmen Square incident] was actually rather an

anomaly at this time.) The Russian military, by contrast,

was becoming more political. The short-lived August 1991

coup in Moscow was the work of an increasingly divided and

politicized Soviet military operating against an equally

divided and disoriented political elite.8

In Russia, domestic disorder increased, leading to the

eventual collapse of the Soviet State. The Soviet Union

116
suffered a decline of unprecedented rapidity. Never before

in modern times had a Great Power experienced a

peacetime failure of this magnitude in such short order. For

most of the 1990s, the Russian economy was in a virtual free

fall. By 1997, the World Bank estimated the Russian gross

national product (GNP) as $403.5 billion,9 just ahead of the

Netherlands and behind South Korea, or about 5 percent of

that of the United States. Despite signs of recovery as of the

second half of 1999, Russia’s economy has still not reached

the point where it can operate in an orderly and predictable

fashion.10 In the 1990s Russia=s gross domestic product

(GDP) dropped 36 percent; its industrial output was valued

at 45.7 percent, its agricultural output at 38.8 percent and

its fixed capital investment at 74 percent.11 Russia=s

significant turnaround in 2000 (its GDP rose 7.6 percent

above the GDP of 1999) was largely caused by the rise of oil

prices on the world market. Russia=s structural

predicament did not experience any fundamental change.12

Russia=s steep economic decline has inevitably impaired

its military potency. ANot since June 1941 has the Russian

military stood as perilously close to ruin as it does now,@

lamented a prominent Russian scholar in 1998.13 In the

same year, the Russian armed forces did not receive any

new nuclear submarines, tanks, combat aircraft, or

helicopters. The deficiency and rapid deterioration of the

Russian military was repeatedly demonstrated in the

prolonged Chechnya wars and, more recently, in the tragic

sinking of the Kursk.

Far from suffering from a steep decline like that of

Russia, China has so far managed to achieve a sustained

economic growth since the late 1970s. Between 1979 and

2000, China’s average GDP growth was about 9.6 percent.14

Annual growth rate for the first half of the 1990s was as

high as 13.1 percent. China=s growth rate did come down in

the second half of the 1990s, partly as a result of bottlenecks

in the domestic Chinese infrastructure, and partly as a

result of the Asian financial crisis which hit between 1997

and 1999. However, the average growth rate for the period

117
remained at about 8 percent. A country the size of China will

inevitably attract attention at best and anxiety and fear at

worst when it enjoys such a high rate of growth. And its

success is all the more striking when compared to the

miseries of Russia.

The rise of China and the decline of Russia changed the

balance of power in a relatively short period and left Russia

more vulnerable than it had been at any time in the previous

3 centuries. The growing gap between the domestic political

systems of Russia and China could easily become a source of

conflict.15

Indeed, for much of the 1990s China was seen as a

problem thanks to the combined influence of Russian

realism (a mixture of Marxian materialism and Russian

realpolitik thinking) and Russian multilaterialism (a

variation of Western Liberal institutionalism). Russians

tended to hold the following views:

• A growing Chinese challenge in the Asia-Pacific

needed to be dealt with seriously.

• Russia=s close ties with China were to counter the

adverse developments in the European theater

caused by NATO expansion and Russian weakness,

not to counter the potential expansion of U.S. power in

Asia.

• Russia did not need and could not afford a new area of

hopeless confrontation in Asia after NATO expansion

was absorbed in the West.

• Russia=s vision of a Amultilateral world order@ actually

viewed the U.S.-led alliances in East Asia as part of

the multilateral institutional framework against

which Russia should anchor its relations with China.

• After accepting a defeat in European security policy in

the West, Russia badly needed to demonstrate its

ability to cooperate with the United States and the

118
West. It thought, moreover, that the United States

might reward Russia for not opposing its goals in East

Asia.16

Thus, both historical experience and post-Cold War

necessities set the stage for a more challenging bilateral

relationship between Beijing and Moscow.

Despite this, China and Russia have developed much

closer and more cooperative relations. It is certainly true

that China and Russia have many political differences. It is

also true that a considerable amount of geo-strategic

Adiscomfort@ has resulted from the radical shift of power

balance between the two countries. Nonetheless, they are

anxious not to fall once again into the “traps” of the past.

This has helped to sustain an interest in developing

normalized relations. Meanwhile, common concerns of a

not-so-friendly post-Cold War peace have steadily pushed

Moscow and Beijing toward coordination at all levels,

particularly in strategic, diplomatic and security areas.

III. MOSCOW AND BEIJING IN THE ACOLD

PEACE@

In the past decade, Sino-Russian relations have evolved

in two broad phases.

1. 1989-1995. Russia and China first tried to stabilize

relations in 1989 and 1992, when each were in the midst of

an internal crisis. By 1994-95 they had progressed to the

point of developing a future-oriented Aconstructive

partnership.@

2. 1996-2001. By the end of 1996 the Russians and

Chinese had formed a Astrategic coordination partnership@

designed to help them to cope with a Achilly@ post-Cold War

world. At the turn of the millennium, Beijing and Moscow

found themselves compelled to deepen and broaden this

partnership. Now, in the year 2001, they have signed a

comprehensive Treaty for Good Neighborliness,

Friendship, and Cooperation.

119
In Search of Stability: Towards a Constructive

Partnership (1989-95).

One striking feature of the post-Cold War Sino-Russian

relationship was the high frequency of summit meetings.

(See Table 1.) The momentum began in 1989. In that year

alone, some 100 exchanges took place at the vice ministerial

level or higher and across all areas. Many of these

exchanges had been arranged before Gorbachev’s 1989

China trip. Russian reaction to the Chinese crackdown of

the same year had been negative. So the fact that these

visits actually took place indicates that both sides were

determined to maintain the momentum of their

reconciliation.

Meanwhile, Beijing and Moscow began to restore and

expand their institutional contacts across a wide range of

areas, including party-party contacts, trade, banking,

journalism, trade unions, internal security, controlling

agencies, women’s associations, the aerospace industry, and

the military.17 Regardless of the actual results of these

contacts, the fact that these top officials met, got

acquainted, and talked to one another is very significant.

Before the normalization of relations, there were hardly any

high-level contacts between Russians and Chinese apart

from the visits made on the deaths of Soviet leaders (the

so-called Afuneral diplomacy@).18

In the next 2 years, two top Chinese leaders visited the

Soviet Union. The visit by Li Peng to Russia in April 1990,

was the first visit by a Chinese Premier for 26 years, and

that of Jiang Zemin in May 1991 was the first visit by a

Party General Secretary in 34 years. These visits turned out

to be the last before the Soviet collapse. These high-level

exchanges, however, set up important institutional

frameworks for the continuous normalization process

including cooperation in economic matters, science and

technology, regional security (Korea and Indochina), border

confidence building and demarcation, and regular foreign

policy consultation at various levels.19

120
Russia and China both felt a heightened sense of threat

following the Gulf War, especially given that both countries

had had serious reservations over the use of force. The sense

of threat increased their interest in developing more

121

Table 1. Mutual Visits by Top Chinese and Russian

Leaders, 1989-2001.
amicable bilateral relations which could give them both

some badly needed breathing space.

The August 1991 coup in Moscow temporarily knocked

bilateral relations off balance. China feared that it would no

longer be able to play the very useful Soviet “card” against

the West. They were also concerned whether or not the

Soviet Union would abide by the accords they had signed

with China.

While the Chinese debated the nature of Russia=s

political change, Deng gave instructions that the Chinese

should A[O]bserve the development soberly, maintain our

position, meet the challenge calmly.@

20 To secure its

interests and minimize the impact of Russia=s instability,

Beijing moved quickly to support Russia in its bid to succeed

to the Soviet Union=s seat in the U.N. Security Council and

to secure China=s accords with the former Soviet republics.21

China=s initiatives eventually paid off. After more than a

year of managing domestic disarray, Russian President

Yeltsin visited China at the end of 1992 and declared that

A[An] important step has been made in the development of

bilateral relations, and a new page has been opened in our

friendly relations.@ The signing of a Joint Statement on the

Basis of Mutual Relations cemented the evolving new

relationship. China and Russia declared friendship,

renounced the use of a nuclear first strike against the other

country, and pledged not to enter into treaties Aprejudicing

the sovereignty and security interests of the other party.@

Twenty-three other documents relating to economics, trade,

science and technology, and culture were signed. The

Chinese and Russians also agreed to cooperate in certain

military and technological projects, in food credits, in the

construction of a nuclear power plant, and in the reduction

of troops along the border.22

Top-level contacts between China and Russia helped to

stabilize the ties in the most uncertain period of their

domestic and foreign policies. Over the next few years, a

stream of top foreign policy and defense officials traveled to

122
one another’s capital, culminating in September 1994 when

President Jiang traveled once again to Moscow for the

second time in 17 months. Among the signed agreements

was a document in which Russia and China agreed not to

target their strategic missiles at each other. This

represented an official ending of hostilities.23 It also came as

a major relief for Beijing, since Russia in late 1993 had

dropped its long-standing commitment not to be the first to

use nuclear weapons in a conflict.24 In a subsequent joint

statement the two sides, for the first time, defined their

bilateral relationship as a Aconstructive partnership@ of

equality, mutual benefit and friendship between the two

countries extending into the 21st century.25 This statement

indicated that after several years of mutual adjustment to

each other’s domestic upheavals, China and Russia were

beginning to coordinate their foreign policies. Although

both countries have denied this, this included joint efforts to

oppose the will of the United States.

In May 1995, Jiang again traveled to Moscow to attend

the commemorative activities for the 50th anniversary of

V-E Day. Given the nature of the celebration it was

somewhat surprising that the Russians invited a

non-European to attend and one can but assume that

Russia had an ulterior motive.

Deepening and Broadening the “Strategic

Partnership” (1996-2001).

The second half of the 1990s witnessed a notable

upgrading of the Sino-Russian relationship from

“constructive partnership” to “strategic coordination

partnership.” Although both sides continue to deny that

there is anything of an alliance-building nature in this

strategic partnership, Beijing and Moscow are clearly

coordinating their foreign policies on the world stage in an

increasingly active fashion.

The concept of a Sino-Russian “strategic partnership”

was first tossed around in early 199626 and became official

123
when Yeltsin traveled to Beijing for the second time as

Russian president. Thirteen agreements were signed,

including a hotline to facilitate communications between

top leaders and a joint committee chaired by the two

premiers to supervise the implementation of the bilateral

agreements.27Yeltsin=s China tour also activated what came

to be known as the AShanghai-Five,@ a multilateral regime

between Russia, China, Kazakhstan, Tajikistan and

Kyrgystan. Among a series of accords signed was a historic

agreement on Confidence Building in Military Field along

Border Areas.28

Over the next few years, the forum gradually became

institutionalized. It regularized summit meetings and

ministerial-level consultations on a whole range of issues

including border demilitarization and stability, military

confidence building, terrorism, separatism, cross-border

crimes, economic cooperation and exchanges, etc.29 With the

revival of domestic separatist and religious fundamentalist

movements in the region, the AShanghai-Five@ provides a

multilateral anchor for all participants. The forum=s

apparent success led to its first expansion in 2001 when

Uzbekistan officially joined and it was renamed the

AShanghai Cooperative Organization@ (SCO).

The momentum of the Sino-Russian strategic

partnership, unleashed in early 1996, quickly picked up at

the first regular premiers meeting at the end of 1996. On

this occasion, a high priority and much publicity was given

to military sales and technology transfers. Military

cooperation and arms sales no longer were part of a Ahidden@

agenda for those top-level exchanges. Li was also the first

foreign leader received by Yeltsin after his heart surgery in

November.30 The ailing Russian president was said to have

taken a personal interest in trying to secure the transfer of

arms to China in both qualitative and quantitative terms,

and, in particular, trying to arrange for the licensed

production of 200 Russian Su-27s in China.

124
By 1997, Sino-Russian Astrategic partnership@

developed more substance when Jiang Zemin (April) and

Yeltsin (November) visited each other=s capital. In a series

of political statements, the two men declared thatAthe era of

strategic alliance targeting on the third country is over@ and

Alarge powers should go with the global trend of

multipolarity.@ This last remark expressed a clear aversion

to the West-dominated post-Cold War world.31 The official

Chinese newspaper interpreted Jiang=s visit as an

indication that the Russians and Chinese were no longer

concerned only with bilateral issues, but with Amultipolar

content.@

32

The spirit of summitry continued through 1998 and

culminated at the end of 1999 when Yeltsin chose to go to

Beijing on his last presidential foreign trip. The gesture

served as a reminder to the United States that Russia

Apossesses a full arsenal of nuclear arms.@ In the following

month, a military memorandum of understanding was

signed between Russia and China to cooperate in a range of

issues. The two sides spoke, in particular, of the Adeepening

of military-technical cooperation between@ the two armed

forces and defense industries.33 Yeltsin apparently went too

far, at least for some in Russia. His successor Vladimir

Putin tried to restore the balance in the new millennium by

delaying his promised visit to Beijing. Once the

European-minded Putin34 was in Beijing in July 2000,

however, the former KGB colonel signed the ABeijing

Declaration@ reaffirming all previous commitments.35

Moreover, Putin and his Chinese host issued a joint

statement opposing the US National Missile Defense

(NMD) system at the expense of the 1972 anti-ballistic

missile defense treaty.

There are multiple causes for the growing ties between

Beijing and Moscow. One explanation is the fact that almost

all of the Chinese leaders in the political, economic, and

defense areas were trained in the former Soviet Union

during the 1950s.36 Their natural sympathy for Russia may

have led to their policy preference. Such an argument,

125
however, should not be overplayed. Despite their

experiences in and with the former Soviet Union, these

Russian-speaking Chinese elites have presided over their

huge country in the most daring Westernization experiment

ever seen in Chinese history. While Russian (Soviet) leaders

have swayed between orthodox communism and democratic

capitalism, the Chinese are mixing both. The result is that

today=s Chinese are perhaps more Western-looking than

most of Putin=s fellow countrymen. At the same time, unlike

the elites who founded communism a century ago, they no

longer perceive the West through a ARussian lens.@

Frequent summits and exchanges at all levels and

dealing with a broad range of issues serve a variety of

practical purposes. First, they help to stabilize bilateral

relations at a time of domestic and international change.

They provide a direct and immediate means for both sides to

observe and evaluate each other when new political faces

emerge, particularly in Russia.

Second, Russia and China need to consult regularly with

one another to discuss the security of the Asia-Pacific

region. Northeast Asia has been an area of grave concern for

both countries for the past 100 years. This is particularly

true in the case of Russia. Russia has lost influence in

Eastern Europe, and its territory has shrunk thanks to the

break-away of former Soviet Republics. As a result, Russia

has become more oriented towards the Asia-Pacific. As long

as relations between Russia and the former Soviet republics

remain unsettled, the stability of its long border with China

will play a key role in preserving the integrity of the Russian

Federation. In Southeast Asia where Moscow and Beijing

used to engage in intensive rivalry with one another,

Chinese diplomats have regularly briefed their Russian

counterparts. These have, however, until recently, failed to

keep themselves involved because they have been

preoccupied by an enormous amount of work with the

so-called Anear-abroad@ affairs: relations with former Soviet

republics which are now independent states.37

126
The best explanation for the increasingly close

Sino-Russian political strategic relationship in the

post-Cold war era, however, lies elsewhere. To fully

understand why these two countries have learned to

cooperate in spite of their increasingly different internal

systems, we must consider external relations between

China and Russia and the dominating Western powers,

particularly the United States.

Relations between both China and the West and Russia

and the West were full of Airritants@ during the second half

of the 1990s. U.S. President Clinton=s 1995 decision to allow

Taiwan’s President Lee Teng-hui to visit the United States

led to a steep downturn in Sino-U.S. relations. Before and

during the March 23, 1996 presidential election in Taiwan,

the PLA conducted a series of exercises along the Taiwan

Strait and the United States responded by sending two

carrier task forces to the area, a situation not seen since the

end of the Vietnam War.

Russia, too, felt exposed to an increasingly chilly

post-Cold War climate. The brief Ahoneymoon@ period

between Russia and the West was over as early as 1992.38

Russia had initially adopted pro-Western policies. They

were seriously undermined, however, by the realization

that the West would not provide massive aid to Russia and

then by the shock of the Western decision in 1993B94 to

expand NATO.

These external pressures on the two continental powers

culminated during the 1999 Kosovo war when the U.N. was

bypassed, the Russians were sidelined, and the Chinese

were bombed. All this was done using a

“fight-for-values-not-for-territories” justification. The

United States could also apply this principle to criticize the

domestic policies of China and Russia and defend the cause

of Chechnya, Taiwan, Tibet, and the Falun Gong. Once

again, Beijing and Moscow moved to strengthen their

strategic relationship. This time, it was the Russian

127
military that became more willing to transfer military

hardware and technology to China.39

The Millennium Turn Toward the Post-Post-Cold

War.

At the onset of the new millennium, Beijing and Moscow

further elevated their strategic partnership by signing a

comprehensive, 25-article “friendship treaty” in July 2001

to counterbalance Washington’s increasing unilateralism.

Although both sides insisted that their actions did not

target any third party, the 20-year treaty does require

Moscow and Beijing to coordinate their responses closely in

the event that either country is subjected to pressure or

aggression from another power.40 Such a move toward

stronger and deepened strategic relations, however, was

soon to be tested by the impact of the September 11 attacks

against the United States in 2001.

The idea of signing a comprehensive friendship treaty

was conceived by Yeltsin and Jiang Zemin in 1996 in order

to promote and institutionalize their growing yet somewhat

uncertain relationship. In July 2000 when Putin visited

Beijing for the first time in the capacity of Russian

president, the Chinese raised the issue again. For Beijing, a

general framework for bilateral relations was needed to

cope with the sudden change of the guards in the Kremlin at

the end of 1999. Moreover, the Russia=s new head of state

(Putin) did not appear to be eager to develop relations with

Beijing in the first few months of 2000. For Moscow,

Russia=s historically weak position requires some safety-net

to deal with a rising China.

The nonbinding features of the treaty represent a

culmination of two significant characters in

Beijing-Moscow=s relations in the past decade. One is close

coordination on a range of major issues, particularly in

foreign and defense areas, in order to safeguard their

sovereignty at the minimum and to promote a multipolar

world at maximum. This includes collective opposition to

128
the U.S. missile defense plan, coordination at the U.N. and

other multilateral diplomacy, regional security, border

stability and antiterrorism/separatism (Taiwan and

Chechnya). While Beijing continued to support Russia=s

effort to maintain Astrategic stability,@ Putin reminded

Washington, right after his meeting with President Bush in

Slovenia and for the first time by a Russian president, that

China should not be overlooked or kept in the dark during

the U.S. pursuit of missile defense.41 According to Putin,

Russia had taken an interest in ensuring that China=s

strategic concerns are addressed in the debate. AThe

transparency of our action is very important, lest none of the

nuclear powers would feel abandoned or that two countries

are making agreements behind their backs,@ insisted

Putin.42

The second and perhaps more important character of

their strategic partnership is the desire and efforts by both

sides to maintain maximum flexibility in their respective

relations with other countries. This is particularly true with

regard to relations with the United States. Aside from

issues such as sovereignty and missile defense, Moscow and

Beijing seem to have reached a stage of not overreacting to

the other=s relations with Washington, at least not publicly.

In the aftermath of the EP-3E collision with the Chinese Air

Force jet in the South China Sea, Russia expressed Aregret@

over the accident and maintained a rather neutral position

in what the Russian foreign minister depicted as Aan

accident which brought to the verge of crisis for the bilateral

relations of the two big countries in Asia-Pacific.@

43 After the

U.S. massive arms sale to Taiwan in late April, the Russian

foreign ministry referred to the sale as a Aquestion of

bilateral relations.@

44 Whatever the case, Moscow and

Beijing seem to deliberately avoid jumping to act on behalf

of their strategic partner=s side with regard to each other=s

relations with Washington even during times of crisis.

Curiously and ironically, the worsening relations with

the United States during the first few months of the Bush

administration actually led to a Sino-Russian joint effort to

129
improve relations with Washington. During the mid-June

Shanghai-Five annual summit in 2001, Jiang Zemin asked

Putin to convey a verbal message to U.S. President George

Bush to the effect that China Ais willing to pursue a

constructive, predictable and positive policy vis-à-vis all its

partners, the United States including.@ Putin accepted the

mission Awith pleasure.@

45 This was followed by a series of

diplomatic gesturing by both sides to help improve relations

between China and the Bush administration.46

If anything, Moscow and Beijing seemed to work closely

to help softly land the A800-pound gorilla,@ and at the same

time to smooth their respective rocky relations with

Washington, though for their own interests. Some

influential Chinese analysts went as far as to describe

relations between the United States, China, and Russia as a

Astrategic triangular setup,@ a far cry from a typical, normal

but rigid alliance treaty.47 Managing relations with the sole

superpower is in the ultimate interests for both countries=

political transformation and economic modernization. For

that purpose, Moscow and Beijing=s long articulated

nonzero-sum and no-enemy-and-no-alliance approach to

their strategic partnership should not be interpreted as

mere lip service.

The seemingly contradictory characters of the

Sino-Russian strategic partnership and the friendship

treaty—close coordination and maximum flexibility—can

be possible only if officials at various levels in both countries

develop high levels of confidence and trust for each other.

Their interactions, therefore, will focus on bigger and

strategic pictures while not being hampered by minor issues

and irritants such as occasional spying cases and other

disputes. Indeed, after a decade of carefully cultivating

bilateral relations, Russian and Chinese leaders seem to be

able to conduct real, informal but substantive Astrategic

dialogues@ whenever they meet. Some Chinese analysts

compared the current Russian-Chinese summit meetings

with Mao and Zhou Enlai=s meetings with Nixon and

Kissinger in the early days of Sino-U.S. strategic

130
partnership, when top leaders of the two countries roamed

over philosophic and strategic issues while leaving

secondary problems for their assistants or to the future. In

contrast, recent high-level contacts between Chinese and

Russians with their American counterparts always take the

format of long Ato-do@ lists from the U.S. side which are

followed by hard and bitter bargaining.

To be fair, Beijing-Moscow relations would improve with

or without the U.S. factor, given the protracted enmity, the

tremendous cost for both, and the desire for normal

relations. However, the mutual feeling for the postBCold

War chill, or the Acold peace@ in Yeltsin=s words, simply

accelerates the warming process. As a result, the two were

somewhat compelled to form and deepen a strategic

partnership from 1996 onward,48 even if their respective

national interests require them to have good relations with

the West, particularly with the United States. In the final

analysis, the external pressure clearly drives the two

countries closer along geopolitical line, despite the growing

differences in their respective domestic systems.

III. AGUNS@ WITHOUT ABUTTER@: ECONOMICS OF

CONSTRAINT

The Areluctant@ strategic partnership between Russia

and China can be further demonstrated by their

insignificant and disappointing economic relations. Despite

the rather rosy predictions made by both sides in the

mid-1990s and ambitious goals to push annual bilateral

trade to U.S.$20 billion by the decade=s end,49 two-way trade

in 2000 was at an insignificant level of $8 billion, barely

surpassing the 1993 level of $7.7 billion. (See Figure 1.)

131
132

Figure 1. Sino-Russian (Soviet) Trade, 1980-2000.
There is, however, a qualitative difference between

current and past economic relations. Both countries now

trade with each other for purely tangible interests, whereas

in the past economic relations were marked by a high degree

of politicization.

During the 1950s, the Soviets gave a massive $2 billion

in economic loans to China. These were largely the result of

China=s lean-to-one-side strategic choice. The sudden

withdrawal of Soviet aid from China at the decade’s end was

followed by a serious ideological divide between the two

communist giants. During the 1960s and 1970s, Russia and

China had very few economic ties to one another. While

Moscow developed close economic relations with its Eastern

European partners, China=s self-imposed Asplendid

isolation@ reduced Beijing=s trade with the outside world to a

minimum. None of this was unexpected. The centralized

economic systems in both communist countries were closely

related to their respective political systems. These dictated

the economic activities in both countries. The low level of

trade between Russia and China reflected this reality and

also reflected their soured political relations.

Structural Impediments.

The basic problem for Sino-Russian economic relations

is a lack of mutual dependence. The Chinese are interested

in acquiring Russian weapons and some raw materials, but

beyond that, the Russians and Chinese do not need one

another very much. Russian trade with China represents

only a fraction of its total trade. The same is true of Chinese

trade with Russia. Part of the reason is that China=s

historical rise and Russia=s unprecedented peacetime

decline have equalized the two powers in such a way as to

ensure that both need, and compete for, the same resources

in the world (capital and technology).

The limited degree to which Russia and China need one

another is reflected in some interesting trading statistics. In

1999 Russia was ranked as China’s 9th largest trading

133
partner, while China was Russia’s 10th largest trading

partner. In this same year, the volume of trade between

China and Japan, the United States, Hong Kong, and the

European Union was 7 to 10 times greater than it was with

Russia. A curious situation has developed whereby China

and Russia both see the other as a supplementary market,

that is as an outlet for those products which are not

competitive in other areas. As a result, both tend to export

their quality products to advanced countries while sending

one another sub-standard stuff.50

This structural impediment to their economic relations

has been further aggravated by Russia=s sluggish market

demand. Russia=s economic reform policies have been

inconsistent and did not help produce a stable market

economy. They were notable for their absence under

Gorbachev and then overabundant under Yeltsin. Indeed,

Yeltsin’s AShock Therapy@ in the early 1990s produced only

shocks without therapy. Later, Yeltsin=s partial abandoning

of market reform and Russia=s 1998 financial meltdown

only made things worse. The result of these developments is

astonishing: the most dynamic market economy under

communist political control has evolved in China and the

fastest economic decay in peace time in modern history is to

be found in a democratic Russia.51

Another structural problem in the bilateral trade

between Russia and China is Russia=s heavy reliance on a

limited number of Chinese manufactured items such as

military hardware. These military transactions accounted

for the 50 percent boost in bilateral trade in 1992 (from $3.9

billion in 1991 to $5.85 billion in 1992) and another 31

percent jump for 1993 ($7.68 billion). The amount of money

that China is prepared to spend on military hardware is

nonetheless limited, as the PRC is more interested in

acquiring technology than in spending its hard-earned

foreign hard currency for the finished products. This may in

part explain the considerable drop in trade between 1994

and 1995, following the deliveries of the contracted military

items. The collaboration between Russia and China in many

134
nonmilitary related areas has yet to be deepened and

expanded.

There are a number of factors that have contributed to

the limited bilateral trade. These include the depressed

consumer demands, the unpredictability, and corruption

which resulted from Russia=s economic disarray. The

cumbersome accounting methods used by the Russians and

the Chinese in their bilateral trade have also contributed to

the problem. In 1994, Sino-Russian trade dropped by 30

percent to $5.1 billion, due to the conversion of bilateral

trade accounting to hard currencies.

There are also some psychological obstacles in the way.

Some Russians are quite concerned with the fast-growing

China trade. This is particularly disturbing to them as it is

accompanied by the general decline of Russian trade with

Western countries. They are worried about the apparent

influx of Chinese (legal or illegal) seeking economic

opportunities in Russia. They are also troubled by the

notion of becoming economically dependent on China.

Light at the End of the Tunnel?

At the turn of the millennium, however, some bright

spots emerged in bilateral economic ties. First, Russia

began to see the revival of its economy after a decade of

stagnation and decline. In 2000, Russian GDP rose 7.6

percent and its industrial output, 9 percent. Its foreign

reserves reached $28 billion.52 Russia=s recovery was

facilitated not only by high oil prices in the world market,53

but also by Putin=s effort to restore centralization of the

Russian economy and politics, thereby facilitating a more

orderly economic transaction with China. Three years after

the Asian Financial Crisis, China=s economy, too, began to

gallop at a faster pace. With an 8 percent GDP growth in

2000, China=s demands for Russian timber, rolled steel, and

fertilizer rose sharply. Economic recovery in both countries

apparently led to a better-than-expected trade situation.

The 2000 bilateral trade volume rose sharply to $8 billion,

135
the best since 1980, and the first half of 2001 saw another 30

percent jump in bilateral trade.

Trade relations will also be facilitated by some

economically ambitious and politically significant projects

that are currently being worked out, notably by two major

pipeline deals. One is the $2 billion, 2,000 kilometer (km)

Tomsk-Beijing oil pipeline with a maximum capacity of half

a million barrels per day (bpd). The other is the $4 billion,

3,700 km Kovykta (Irkutsk)-China natural gas line with a

maximum capacity of 35 billion cubic meters per year (bcm).

Since late 1999, both Russian and Chinese oil firms have

been working together with the two governments to

hammer out the technical and financial details.

In the year 2000, Russia only provided a fraction (10

million barrels) of China=s 300 million barrels of annual

imported oil. However, provided that its economy continues

to rise, China=s thirst for energy will grow only faster in the

future: it is entering into the automobile age, which will

bring with it vastly increased consumer demand. The

Tomsk-Beijing oil line will be able to supply half of China=s

current annual import. Without it, China will find itself

increasingly affected by the unstable Mideastern region and

by the potentially disputable sea lanes (South China Sea

and the Taiwan Strait).

Russia’s impoverished Asian region will get a badly

needed economic boost from the projects. Moreover, these

projects will provide an anchor for future relations with

China. It will ensure more predictable relations between the

two countries in the next 5 to 10 years across the economic,

political, and strategic areas. This will be badly needed as

Russia continues its difficult recovery from its historical

decline.

In additional to major energy projects, the two sides have

tried to explore some potentially lucrative projects. One

such project is cooperation on producing a new generation of

civilian planes and energy equipment. The multi-billion

U.S. dollar Lianyungan project started in October 1999.

136
They plan to follow this by cooperating in building yet

another nuclear power plant. The two sides are close to a

deal on China=s participation and operation of Russia=s

Global Navigation Satellite System (GLONASS) as an

alternative to the U.S. equivalent Global Positioning

System (GPS).

Meanwhile, Russia and China are finally reaping the

benefit of years spent trying to develop specific trade

mechanisms. They have improved the trade environment,

strengthened the mechanism for making payments, and

developed account settlements, arbitration, loans, and

insurance. Unified dispute-settlement mechanisms, too,

have been gradually introduced in major trading ports

along the border.54 Putin=s emphasis on law and order at

home also helped foster more normalized transactions

between the two. Meanwhile, trade infrastructures have

been developing along the Sino-Russian border. These

include airports, expressways, cargo depots, and free trade

zones. The Tumen River Delta trading/shipping hub, jointly

developed by the U.N. and regional countries including

Russia, is steadily taking shape. At long last, moreover,

North Korea is opening up. This offers both Russia and

China new opportunity for economic growth.

V. SECURITY RELATIONS

The Sino-Russian security relationship is perhaps the

most publicized. While the Western media tends to focus on

issues of military sales to China, this analysis takes a

broader perspective by examining three separate but

related issue areas: border issues, confidence building, and

military sales.

Pacifying the Longest Border.

The political situation in the former Soviet Union was

volatile immediately after the disintegration of the Soviet

Union. Beijing faced the birth, almost overnight, of several

new central Asian nation-states whose internal stability,

137
nuclear potential, and ethnic diversity have created

multiple complexities for both China and Russia.55 China=s

immediate concern was whether agreements with the

former Soviet Union would remain intact and be

implemented.56 China in 1992 nervously watched the

debate in the Russian Duma for the verification of the

border agreement signed before the collapse of the Soviet

Union. It was not until Yeltsin=s visit to Beijing at the end of

1992 that the situation became stabilized. Beijing seized the

opportunity to regain the momentum in working on the

border issue with a joint delegation consisting of officials

from Russia, Kazakhstan, Tajikistan, and Kirghistan.57

The eastern part of Sino-Russian border bargaining was

finalized during Yeltsin=s November 1997 visit to Beijing

where the Russian president agreed to return 1,500

hectares of land to China.58

Because the Russian political scene has been subject to

frequent radical political change, none of the existing border

agreements between Russia and China are guaranteed. By

early 1995, local officials in Russia=s Far East openly

resisted the implementation of the Sino-Russian border

agreements. Some in the Russian parliament went as far as

to suggest abolition of the Sino-Russian border agreement.

Chinese officials openly expressed their concern that that

the economic weakness of Russia was leading to a rise in

Russian nationalism.59 Moscow, therefore, has to reaffirm

its agreement with Beijing from time to time.60 It was not

until April 1999 that the official border survey was finally

over.61 The preservation and implementation of all the

agreements between China and the Russian side (including

three other central Asian states of Kazakhstan, Tajikistan,

and Kyrgystan), however, continue to be a major challenge

within the context of their overall security relations.

Confidence Building.

While border agreements are yet to be fully

implemented, Beijing and Moscow have been steadily

138
progressing in some broader security-related areas. During

Yeltsin=s 1992 visit to China, the two sides signed the Joint

Statement on the Basis of Mutual Relations which

renounced the use of a nuclear first strike against the other

country, and both countries pledged not to enter into

treaties Aprejudicing the sovereignty and security interests

of the other party.@

62 This was followed in 1993 by an

agreement to create a demilitarized zone along their border.

This meant that the Russian military, traditionally

deployed within a 50-to-100 km area from the border, had to

be redeployed further north, while the Chinese side did not

have to do so due to its more in-depth defense posture.

Because of financial difficulties, Russia would have to

substantially cut its forces in the Far East. An accord was

signed with China to prevent inadvertent military

confrontation between the two militaries. This more than

met Russia=s security needs. The two sides also agreed to

inform each other of plans for military maneuvers in border

districts and to exchange information on military doctrine

and experience.63

The effect of these confidence-building agreements was

furthered by a 1994 crisis-prevention agreement during

Chinese Defense Minister Chi Haotian’s visit.64 All these

confidence building measures were combined into a single

document and signed during Yeltsin=s visit to China in April

1996. Three other central Asian states belonging to the

“Shanghai Five” also signed the document. Starting from

1999, staff officers began to observe and verify each other=s

military withdrawal from the border areas. Beijing and

Moscow are even thought to have concluded a secret

intelligence agreement as part of the overall

confidence-building arrangement.65

Military Sales.

Russian military sales to China have been a fast growing

area of exchange. To date, Beijing and Moscow have

completed some major transactions of military equipment

139
including hundreds of Sukhoi-series jet fighters-bombers,

ten Il-76 cargo planes, hundreds of S-300 antiaircraft

140

Table 2. Mutual Visits by Chinese and Russian

Military Leaders, 1990-2001.
missiles (U.S. Patriot equivalent), helicopters, samples of

Russia=s main battle tanks and other armored vehicles, four

Kilo-class conventional attack submarines, and two

Sovremenny-class guided missile destroyers (with the

powerful SS-N-22 Sunburn antiship cruise missiles).

Meanwhile, more deals are reportedly being discussed,

including a joint venture for developing China=s own

fighters; and the grant of a license to manufacture the

Kilo-class submarine and nuclear-powered submarine,

naval vessels, and nuclear and missile technology. These

actual and possible Russian sales have been the largest

foreign arms deliveries to the PRC since the early 1950s

during the Sino-Soviet honeymoon.

There are three rather distinguished phases in the

development of military sales: (1) the early stage (1990-92);

(2) the institutionalized stage (1993-94); and (3) the

expanding stage (1996-2000). In the initial stage, military

sales were the result of a reaction on both sides to some

rapid developments, which had little to do with their

bilateral relations. In particular, sales were stimulated

when the West imposed sanctions on China after the 1989

Beijing crackdown and the disintegration of the Soviet

Union. Over time, particularly after 1993, Beijing and

Moscow both came to develop a sense of realism. They

adopted a cautious approach as they gradually discovered

both the potential and limits of military sales. A process of

institutionalization in military transactions, therefore, was

developed through the mid-1990s which is still in effect

today. Last but not least, NATO’s war against Kosovo in

1999 simply pushed the military sales to a new height at the

turn of the millennium. (See Table 3.)

Searching for Rules of the Game.

Russia’s transfer of military technology to China, at

least initially, largely resud fromarriage of convenience.

The goals and preferences of the two nations are actually

rather different. China is very much interested in

141
technology transfer and would prefer to buy just a few

samples of advanced technology equipment. Russia, by

contrast, would prefer to sell more equipment and transfer

as little technology as possible. In this way, China could be

kept from developing or manufacturing this advanced

equipment in the foreseeable future. The technological gap

between China and Russia would thereby be preserved,

guaranteeing Russia’s national security interests in the Far

East. At the same time, continued Chinese demand for

advanced equipment would be in Russian commercial

interest.

In 1993, several formal accords were signed relating to

military exchanges. Chinese defense official Liu Huaqing’s

June trip to Russia expanded cooperation in industry,

science and technology, and conversion.66 November 1993

also saw the first visit to Beijing by Russian Defense

Minister Pavel S. Grachev, who signed a 5-year military

cooperation agreement to broaden the transfer of military

technology to China. These agreements in 1993 provided

the frameworks to institutionalize cooperation in defense

areas. Since then, more long-term cooperation agreements

in technology transfer have been reached. Among them is

one which defines Russia=s role in developing China=s

manned space program over the next 10 to 20 years.67

142

Table 3. Major Russian Arms Transfers to China

(1992-2001).
Meanwhile, mounting pressures also forced the

Russians to become less cautious in their approach to

China=s initiatives. Toward the end of 1993, Russia became

increasingly disappointed with the West in both domestic

and foreign affairs. The continuous decline of the Russian

economy forced Yeltsin to abandon the Ashock therapy.@ At

the same time, Russia had accumulated a large amount of

debt ($1.5 billion by 1994) in its trade with China. Russia=s

arms sales in the world continued to slide; the year 1994 saw

its lowest sales in 15 years. Meanwhile, Russian civilian

aircraft building was on the verge of Atotal collapse.@

68 The

Chinese market remained one of the few bright spots for

Russian military sales around the world in the post-Cold

War years. Moscow urgently needed to push for more deals

in this traditionally strong area of its economy. Russia

reportedly decided to use military hardware, the only

competitive advantage it enjoys in economic relations with

China, to offset these debts. The Russian Foreign Minister

went so far as to say during his February 1994 visit to China

that the Russians would set no limits on Russian military

sales to China. After this, Russia produced a quite

impressive list of some 44 items for China=s military,

including some very advanced hardware.69

In addition to the Gulf War, the strongest push for closer

military ties between Beijing and Moscow, which came in

the 1990s, ironically resulted from Western, particularly

US, policies toward the two continental powers. In the first

half of the decade, the Russians and Chinese were still

bargaining over peripheral issues with regard to pricing,

after-sale service, and payment methods. NATO expansion

and the Taiwan Strait Crisis paved the way for progress. In

May 1995, Washington announced its decision to invite

President Lee Teng-hui of Taiwan to visit the United States.

A month later, in June 1995, Premier Li Peng of China

visited Russia: at the top of his agenda was Sino-Russian

cooperation over military technology. For the first time,

both sides publicly indicated that they intended to push

their cooperation further in this sensitive area. This

143
represented a notable change from their previous evasive

behavior.70 As a result of these developments, 1995 and

1996 witnessed sales of additional Su-27s, more technology

transfers to China and joint-production of Su-27s.71

Accidental Bombing and Accidental AAlliance.@

Toward the end of the decade, the same cycle of events

was repeated when NATO=s 1999 war in Kosovo angered

both Moscow and Beijing, though for different reasons.

While the Russians were frustrated because they were kept

out of the conflict, the Chinese were furious because they

were Aforced back@ to a far away conflict by the Aaccidental@

bombing of their embassy in Belgrade on May 8.72

Until this point, the Astrategic coordinating partnership@

between Beijing and Moscow was a Anonalliance," said to be

“nonconfrontational, much less directed at any third

country or third party.@

73 Both sides depended more on the

West-dominated world trading system than on each other.

Neither intended to get closer to the other at the expense of

relations with the West.

The Russian Prime Minister was half way to the US

when the Kosovo air war began. He simply suspended his

journey and headed for home to show Russia=s displeasure.

This contrasts with Jiang Zemin who continued his official

visit in Italy, from where NATO was dispatching its military

jets to bomb Serbia. The Kosovo crisis and particularly the

embassy bombing changed the strategic thinking in Russia

and China. A redefinition of their largely Aharmless@

strategic partnership and their respective policies toward

the West was merely a matter of time.

Following the bombing of the Chinese embassy on May 8,

however, some Russian officials openly discussed a possible

defense alliance with China, particularly in areas of

weapons sales, personnel training, intelligence exchange,

and policy coordination. In May 1999, a number of top

Russian generals visited the Chinese capital, including

144
navy chief Admiral Vladimir Kuroyedov and Chief of the

General Staff of the Russian Armed Forces Valiedin

Korapierinykof. Between June 7-17, 1999, General Zhang

Wannian, deputy Chairman of China=s Central Military

Committee, visited Russia at the invitation of the Russian

Defense Minister. Moscow is said to have treated Zhang

with the Ahighest protocol.@ In his half-hour phone call with

President Yeltsin, the Russian leader said that he would do

his utmost to promote the continuous deepening and

development of the comprehensive and friendly cooperation

between the two countries. The new Prime Minister Sergei

Stephashin, who was born in China when his father was an

adviser to the PLA Navy, also met with General Zhang. He

focused at this meeting on weapons sales. He was quoted as

saying that “no other Russian premier was born in China. . .

. My father served in the navy and helped build China=s

armed forces. Now, meeting you, I feel I am continuing my

father=s cause.@

74

One of the major developments in Stephashin-Zhang

meeting was an agreement for Russia to sell dozens of

Su-30s to China. In the past, Russian arms sales had always

been hampered by Moscow=s reluctance to pass to China

sensitive technologies. Moscow had only agreed to sell an

older model of the Su-27 while licensing India to produce the

Su-30s. During Chinese Premier Zhu Rongji=s visit in

February 1999, Moscow only agreed in principle to

negotiate the details for the sale. The deepening of the

Kosovo crisis apparently accelerated pace of the hard

bargaining between Moscow and Beijing over the sale of this

fighter-bomber, the best in the Russian inventory. The two

sides even started talks to discuss the possibility of Russia

granting the Chinese a license to produce for itself another

200 Su-30s.75

In an article speaking of these these developments, the

influential Russian Izvestiya newspaper said that the

combination of Chinese money and Russian military

technology could create a powerful force on the world stage.

The same Russian newspaper also quoted General Leonid

145
Ivashov, head of Russia=s international department, as

saying that the consequence of NATO expansion and the

Kosovo crisis would be Athe swift return of the world to a

bipolar system.@

76 By early 2001, China and Russia were

reportedly actively cooperating in the exchange of military

technology research and development to counter the US

missile defense systems.77

CONCLUSION: HOW TO MANAGE “NORMAL”

RELATIONS IN THE POST-POST-COLD WAR

From time to time in Sino-Soviet relations, younger men

in the Kremlin have challenged older leaders in Beijing.

Now, 45 years after Khrushchev’s de-Stalinization

campaign and 15 years after Gorbachev’s romantic and

fatal political reforms, Putin is reshaping his own domestic

and foreign policies. These may be so innovative as to be

unexpected, if not unwelcome, to his older Chinese

counterparts. Nonetheless, until September 11, 2001, its

relationship with China was perhaps one of the few stable

and mutually beneficial ties Russia found in the new

millennium.78

One key feature of the Sino-Russian relationship in the

past 20 years is the absence of ideological disputes. Current

leaders in the two states have every reason to engage in

another round of ideological polemic due to the growing gap

in the nature of their political systems. Lessons from

history, however, are too vivid to forget. For both, the cost of

the past ideological and military confrontations was

enormous. Economically, both countries devoted huge

amounts of capital and manpower to defense at the expense

of the living standards of their peoples. Strategically,

Russia and China had to prepare for a possible two-front

war and put their national economy on a war footing for

many years at the expense of the living standard. For

Russia, conflict with China was perhaps the most important

indirect and long-term cause for the final downfall of the

Soviet Empire.79 History therefore taught them the limits of

146
both their friendly and adversarial relations. Both countries

now seek to find an appropriate balance between their

respective interests and values.

The pragmatic approach to bilateral ties, starting from

Deng Xiaoping and Gorbachev in the 1980s, however, does

not necessarily mean future harmony between the two

sides. It is true that current Sino-Russian relations are,

perhaps, more equal and stable than they have been at any

other time during the past two centuries. But this has

partially resulted from those systemic changes such as the

collapse of the Soviet superpower and the historical rise of

China.

But what if Russia revives and reasserts itself on a more

nationalistic basis? The election of Vladimir Putin already

suggests that there is some likelihood of this happening. Or

conversely, what if China continues to expand both

economically and militarily? China is already perceived as

something of a threat by some, particularly the Russian

nationalists.

If the rise of China remains a protracted process, it is

vital that now, and in the future, the Russians and Chinese

learn how to manage and sustain a generally normal, or

good, relationship. This is definitely more challenging than

the task faced by Mao, Khrushchev, Brezhnev, Deng, and

Gorbachev. These men knew how to trash good

relationships and how to manage bad ones. What they did

not learn to do was to manage a normal relationship. As in

gender relationships, marriages and divorces are relatively

easy, if not all fun. Living with one another, managing daily

chores, listening to, and trying to understand each other=s

complaints, proves to be the hardest thing to do. In the past

10 years Russian and Chinese leaders have been doing just

that and they have been reasonably successful.

If the current trends in East Asia continue, the

“reluctant” partnership between Russia and China will

definitely grow into an “accidental alliance,” for better or

worse. In 1996, a group of prominent American, Japanese,

147
Korean, and Chinese International Relations(IR) scholars80

overwhelmingly rejected an Aearly warning@ of this largely

unintended and maybe unfortunate development:

At the geopolitical and geostrategic level, the current

situation in East Asia points to a growing division between

maritime powers (Japan and the United States) and their

continental counterparts (China and Russia). The division

distinguishes more advanced from relatively backward

powers and established from emerging ones.... [A]lthough

neither Russia nor China intends to renew a 1950s-style

alliance at the expense of their respective relations with the

United States and Japan, nonetheless both are being driven

in that direction in the rather chilly and unsettling

post-Cold War Asia-Pacific climate.81

At the beginning of the new century, both Russia and

China are seriously alienated by the West. This is despite

the fact that the two are substantially AWesternized,@

though each in its own way: the Russians politically, and the

Chinese economically. Indeed, one of the reasons why

Moscow and Beijing have so far resisted closer strategic

coordination is because they would like, eventually, to join

and reap the benefits of the Western-led existing

international political and economic systems.

The status quo, however, is fast changing for both

continental powers. Despite Russia=s displeasure and

despite the warning of classic realists such as George

Kennan,82 NATO expanded in Europe. In East Asia, the

Ano-war-and-no-independence@ status quo across the

Taiwan Strait, which used to benefit all concerned—China,

Taiwan, the United States, and Japan—has been steadily

eroded to a Ano-war-and-no-independence@ (U.S. position)

and Ano-war-but-independence@ (Taiwanese position). This

development started in 1995 when Clinton allowed Taiwan

President Lee Teng-hui to visit the United States. For

Beijing, if the Aone-China@ is disappearing, so is peace.

At the turn of the millennium, the erosion of the status

quo is apparently accelerating at the strategic and systemic

level with the Bush administration=s determination to

148
deploy missile defense systems. In the eyes of Russia and

China, U.S. unilateralism in this regard represents a

unique feature of world history. It is the dominant

superpower that happens to be the most dissatisfied power,

actively departing from and even challenging the very

status quo that has benefited itself and the rest of the

world.83 The Amismanagement@ of the historical decline of

Russia and the historical rise of China, intended or not, will

lead to a situation which nobody wants and which is very

likely to have serious consequences.

Until the September 11 terrorist attacks, China, Russia,

and several other Central Asian states had worked hard for

6 years to build up the Shanghai Cooperative Forum (SCO),

with an antiterrorist center set up in 2000 in the

Kyrgyzstan capital, Bishkek. Between 1996 and 2001, SCO

has been developing an institutional antiterrorist

mechanism for three-fifths of the huge Eurasian landscape

and a quarter of the world’s population (1.5 billion people).

It is also the only major regional security organization in the

world without direct U.S. participation. Washington had

not only been a bystander to that multilateral effort to curb

terrorism in the most volatile part of the world, but it also

treated destabilizing activities in Chechnya and China’s

Xinjiang Province as either fighting for freedom or a human

rights issue (the U.S. State Department even received the

Chechen “foreign minister” in early 2001).

In the short term, the U.S. massive return to Central

Asia has already overshadowed, or is displacing, the

regional security mechanism (SCO) that Moscow and

Beijing have worked hard to develop. For both Moscow and

Beijing, current cooperation with Washington to fight

terrorism may come at a price in terms of long-term

security. Of the two likely outcomes for the current U.S.

military actions in Afghanistan, none seems desirable for

Moscow and Beijing: first, it is unclear if successful U.S.

operations against terrorism will lead to a humble United

States, as Bush=s campaign rhetoric sounded; or if

Washington would go back to the kind of unilateralism as

149
was the case before September 11. Second, a less successful,

messier, or even failed, antiterrorist move by the United

States could cause more instability and a surge of

extremism/terrorism in the region.

Meanwhile, the initial salvo of the military operation

against terrorism is being unleashed against Afghanistan, a

Central Asian state that has already been devastated by 22

years of war. Perhaps no target there is worth the price of an

American missile. However, Afghanistan, together with

other central Asian states, is a geo-strategic meeting place

of the world’s major civilizations: Christianity, Islam,

Hinduism, and Confucianism, all of which, unfortunately,

were nuclearized at the end of last century. Understanding

and managing these issues would be hard enough for

Washington, Moscow, and Beijing during times of relative

tranquility. It is unclear how the massive American

strategic initiative will affect the delicate and dangerous

chemistry of this region. The current war against terrorism,

with all of its good intentions and noble goals, allows very

little margin for error in the age of weapons of mass

destruction.

ENDNOTES - CHAPTER 7

1. The 1689 Treaty of Nerchinsk (made with the Qing Dynasty)

temporarily checked Russia’s historical expansion into Asia. The treaty

followed a number of military clashes between the two countries. By the

late 18th century, however, Russian expansion into areas on China’s

periphery regained momentum and clashes became increasingly

frequent. This period of conflict culminated in the signing of the

Sino-Russian Treaty of Peking in November 1860, which opened the

entire northern frontier of China to Russia’s political and commercial

influence. See A. Doak Barnett, China and the Major Powers in East

Asia, Washington, DC: The Brookings Institution, 1977, pp. 21-22;

Joseph Fletcher, “Sino-Russian Relations, 1800-1862,” in The

Cambridge History of China, Vol. 10, Late Ch’ing, 1800-1911, Part 1,

John Fairbank, ed., Cambridge: Cambridge University Press, 1992, p.

347.

150
2. Feodor Dostoievsky, “Geok-Teppe, What is Asia to US?” in

Readings in Russian Foreign Policy, Robert A. Goldwin, Gerald

Stourzh, and Marvin Zetterbaum, eds., New York: Columbia University

Press, 1959, p. 274.

3. See John W. Garver, Foreign Relations of the People’s Republic of

China, Prentice-Hall, Inc., 1993, Chapter 2.

4. Recent Russian and Chinese literature on the origins of the

Korean War points to an emerging revisionist interpretation. This

argument suggests that Stalin’s decision to allow North Korea to unify

the country by force was primarily caused by his concern about China

rather than the United States. Shen Zhihua, an independent

historian/scholar who has extensively examined the newly declassified

Russian archives and the growing body of information now available in

China has examined this issue. He argues that Stalin reversed his

prudent policy toward the Korean peninsula after yielding to China the

Russian “interests” in the Far East (Port Arthur and the Manchuria

Railroad). This decision followed the 3 months of hard bargaining which

antedated the signing of the Sino-Soviet Alliance Treaty on February 4,

1950. By “unleashing” North Korea, the Soviets thought they were

putting themselves into a “win-win” situation. If Kim Il-Sung won and

Korea was unified, the Russians would have won themselves a major

ally. If Kim Il-Sung lost, the Russians could stand clear. Indeed, Mao

was not informed about Kim’s plan until May 1950, and Kim sent a field

officer to Beijing to brief the Chinese only two days after the outbreak of

the war. Mao, therefore, was “forced” into a conflict that he and his

colleagues did not want. Shen even argues that Stalin supported the use

of force in Korea in order to prevent China’s conquest of Taiwan, thus

leading to the rise of a more powerful communist neighbor in the south.

For details, see Shen Zhihua, Mao Zedong, Sidalin yu Hanahan:

Zhongsu Zuigao Jimi Dangan (Mao Zedong, Stalin and the Korean War:

Chinese and Soviet Top Secret Documents), Hong Kong Cosmos Press,

1998. See also Shen Zhihua, “China Sends Troops to Korea: Beijing’s

Policy-Making Process,” in China and the United States: A New Cold

War History, Xiaobing Li and Hongshan Li, eds., Lanham, MD:

University Press of America, 1997, pp. 13-47. On July 2, 1950, a week

after the outbreak of the Korean War, Premier Zhou Enlai met with

N.V. Roshchin, Soviet ambassador to Beijing, and expressed China’s

strong displeasure regarding the “negative” impact of the war on Mao’s

planned attack on Taiwan. Zhou even handed Roshchin a Chinese

summary of reactions to the Korean War from around the world. This

summary included a statement by a British diplomat that the Soviets

“encouraged the North [to]attack in order to prevent PRC’s unification

with Taiwan,” Shijie Ribao (World Journal), December 7, 1997, p. 2.

151
5. Dan Bo, “Zhonggong de Qingzhi ji Waishi Yanjiu Jigou" (“The

intelligence and foreign affairs research institutions of communist

China”), Cheng Ming, September 1996, p. 30.

6. Ross Terry, Mao: A Biography, New York: Harper and Row, 1980,

p. 202.

7. See Li Zhisui, The Private Life of Chairman Mao, New York:

Random House, 1994.

8. While the Bush administration and much of the US intelligence

community were genuinely surprised by the Soviet collapse, neither the

mainstream IR school (realist or materialist theories) nor the current

constructivists (who use an ideational model) are able to provide

convincing explanations for such an event. For a critique of and

alternative to both schools, see Stephen G. Brooks and William C.

Wohlforth, “Power, Globalization, and the End of the Cold War:

Reevaluating a landmark Case for Ideas,” International Security, Vol.

25, No. 3, Winter 2000/01, pp. 5-53. Brooks and Wohlforth?s article,

however, only offers a general background of the issue and offers no clue

as to why the Soviet reforms had the dramatic outcome they did, nor

why the Soviet collapse happened when it did. A comparative

examination of the civil-military relations for the reforming communist

states helps to understand both the Soviet collapse and Chinese

resilience. See Yu Bin, “Civil-Military Relations in the Transition of

Communism: China and Russia,” Current Politics and Economics of

Russia, Vol. 4, No. 3/4, New York: Nova Science Publishers, 1995, pp.

237-46.

9. World Development Report: Knowledge for Development,

1998-1999, New York: Oxford University Press, 1998.

10. Jeffrey Tayler, “Russia Is Finished,” May 2000.

11. Xinhua, February 10, 2001.

12. Chen Tieyuan, “E Li Xin Jingji Weiji Bin Buyuan" (“Russia Not

Far from New Economic Crisis”), Zhongguo Qingnian Bao (China Youth

Daily), February 9, 2001.

13. Alexei G. Arbatov, “Military Reform in Russia,” International

Security, Vol. 22, No. 4, Spring 1998, p. 83.

14. Lu Wei, “Yingjie Kaifang, Jujue Mishi" (“Welcome Opening Up

and Refuse to Disorient”), Zhongguo Jingji Shibao (China Economic

Times), February 12, 2001.

152
15. This is based on liberal democracy peace theory. See Michael W.

Doyle, “Liberalism and World Politics,” American Political Science

Review, Vol. 80, No. 4, December 1986, pp. 1152-1163.

16. For a detailed review of Russian perspectives, see Andrew C.

Kuchins and Alexei V. Zagorsky, “When Realism and Liberalism

Coincide: Russian Views of US Alliances in Asia,” discussion paper,

Stanford: Asia/Pacific Research Center, Stanford University, July 1999.

17. Gaige Kaifang Yilai de Zhongguo Waijiao (China’s Foreign

Policy During the Reform and Open-door Period), Tian Zengpei, ed.,

Beijing: World Knowledge Publisher, 1993, p. 303.

18. In 28 months, China sent top leaders to attend state funerals for

three Soviet leaders (Brezhnev died in November 1982, Andropov

February 1984 and Chernenko March 1985).

19. The foreign ministers of the two countries met five times in 1990,

including twice in China, to discuss the Gulf crisis. See Tian Zengpei, pp.

305-306.

20. See Huanqiu Congci Liangre: Yidai Lingxiumen de Guoji

Zhanlue Sixiang (A Brave New World: The International Strategic

Philosophy By A Generation of Chinese Leaders), Guoji Zhanlu Yanjiu

Jijin Hui, ed., Beijing: Foundation for International and Strategic

Studies, Central Archive Press, 1993, p. 312.

21. See Tian Zengpei, ed., p. 313.

22. Ibid., p. 316-317; China Daily, December 18-19, and 21, 1992;

New York Times, December 18-19, 1992.

23. Beijing Review, January 2-8, 1995, p. 12.

24. Ibid.

25. Ibid., and April 29-May 5, 1996, p. 11; Renmin Ribao (People’s

Daily, RMRB hereafter), May 9, 1995.

26. Russia’s unilateral declaration for a “strategic partnership” with

China was first made by Deputy Premier Davidov in March 28 and was

echoed by Yeltsin in April 2 when he met with Qiao Shi in Moscow, see

RMRB, March 30 and May 13, 1996. China, however, echoed Russia’s

initiative with the phrase “strategic coordination partnership.” See

RMRB, April 26, 1996.

153
27. The joint premiers committee started to in late 1996 during Li?s

visit to Moscow. RMRB, December 28, 1996.

28. China shares 7,000 kilometers of borders with four other states.

The accord requires all parties not to resort to the use of forces deployed

in the border areas; not to conduct exercises with the opposing side as

the target; limit the scope and number of military exercises; provide

information about major military activities within the 100-kilometer

border zone, etc. RMRB, April 27, 1996.

29. RMRB, December 27, 1996, front page.

30. RMRB, December 28, 1996.

31. Sino-Russia Joint Declaration, RMRB, April 24, 1997, pp. 1, 12;

November 1997, p. 1.

32. RMRB editorial, “A Visit With Far-reaching Significance,” April

28, 1997, p. 1.

33. Itar-Tass, January 13 and 18, 2000; Interfax, January 17, 2000,

FBIS, Central Eurasia.

34. Putin is the first modern Russian/Soviet leader coming from the

most Europeanized Russian city, St. Petersburg; the first to have

extended experience working in Eastern Europe; and the first

German-speaking Russian leader after Lenin. Putin reportedly

confessed to the visiting US Secretary of State Madeleine K. Albright in

February 2000 that his “mentality is European” despite his liking of

“exotic stuff” such as eating Chinese food, using chopsticks, and the

regular practice of judo. See Michael R. Gordon, “Washington Bites Its

Nails as Russian Votes Are Tallied,” New York Times, March 27, 2000.

35. The first item of the Beijing Declaration reads: “All political

documents signed and adopted by China and Russia serve as the solid

basis for the healthy development of bilateral relations. The two sides

will strictly abide by them and make continuous efforts to push the

relationship to higher levels.” Xinhua, July 28, 2000.

36. Jiang Zemin (the CCP General Secretary and President of the

PRC), Li Peng (Premier of the State Council), and General Liu Huaqing

(Vice Chairman of the CCP’s Military Commission and the highest

military officer in the Politburo) were all trained in the Soviet Union

during the 1950s.

37. This was provided by Michael Chambers of Political Science

Department, Indiana State University, March 27, 2001. President

154
Putin’s visit to Vietnam (February 28--March 2, 2001) marked a

beginning of Russia’s return to Southeast Asia.

38. Alexei Arbatov, “Russian Foreign Policy Alternatives,”

International Security, Vol. 18, No. 2, Fall 1993.

39. Colonel General Zhang Wannian, Vice Chairman of China’s

Central Military Committee, was invited by his Russian counterpart

Igor Sergeyev to take a 10-day tour of Russia where he met all the top

leaders and, for the first time, visited Russia’s Strategic Missile Troops.

Zhang’s trip also involved in Russia’s sale of its Su-30s to China.

Interfax, June 17, 1999.

40. See the full text of the treaty at www.people.com.cn, July, 16,

2001.

41. Hong Kong, Ming Pao, June, 19, 2001.

42. Patrick E. Tyler, “Putin says Russia would counter US shield,”

New York Times on the Web, June 19, 2001.

43. RMRB, April 8 & 13, 2001.

44. AFP, April 25, 2001.

45. Interfax, June 15, 2001.

46. Russian Foreign Minister Igor Ivanov later stated that “[T]he

Chinese side attaches great importance to its relations with the United

States for international stability,” and “[T]he Chinese leadership

intends to pursue a constructive policy in its relations with

Washington.” See “Jiang and Putin line up against US missile plan,”

AP, Reuters, 15 June 2001. In their June 18 telephone conversation

during which Putin briefed Jiang on his summit meeting with US

President Bush in Slovenia, Chinese President Jiang Zemin went as far

as to state that “I believe that Russian-US dialogue and cooperation are

conducive to maintaining world peace, security and stability.” Xinhua,

18 June 2001. Toward the end of June, Russian Foreign Minister went

stressed that Russia will do “everything to prevent confrontation

between the US and China, because it will not lead to anything good.”

No problems in the world can be solved without Russia, the US, China

and Europe working together, according to Ivanov. Interfax, June 27,

2001.

47. Chen Haosu, president of the Chinese People’s Association of

Friendship with Foreign Countries (CPAFFC) and Sino-Russian

Friendship Association, was quoted in the report, “Zhongemei xinshiji

155
jiang shangyan xinban `sanguo yanyi” [China-Russia-US? new

`three-kingdoms? romance? in the new century],” www.people.com.cn,

February 19, 2001; “Sino_Russian Good_Neighborly Cooperation Helps

Oppose Hegemonism,” Hong Kong Wen Wei Po editorial, May 1, 2001, p.

A2.

48.”There is no need of a master in the world,” declared Yeltsin

during his meeting with Premier Li Peng in the Kremlin on 27

December 1996, “Nor should countries in the world be divided into the

‘leader?’ and the ‘led.’” Li echoed Yeltsin by stating that “China is not for

a unipolar world. Multi-polarization of the world is more conducive to

world peace and development.” In a somewhat nostalgia yet clearly

supportive tone, Li described Russia as “a great nation, with huge

potential and rich resources. And it should be treated as an important

polarity of the world.” RMRB, December 28, 1996.

49. The Russians and Chinese reached this understanding during

Chinese Premier Li Peng’s December visit to Moscow. See RMRB,

December 28, 1996.

50. Beijing Review, April 29-May 5, 1996, p. 12. For Russians’

complaints, see Alexander Lukin, “The Image of China in Russian

Border Regions,” Asian Survey, Vol. 38, No. 9, September 1998, pp.

821-835.

51. China is the most dynamic country in the world in terms of both

its growth rate (nearly 10 percent for more than 20 years) and the

market-regulated portion of its economy (now nearly 80 percent). These

put China at more or less the same level with that of the United States.

China’s economy is much less regulated than that of the United States

in areas such as pollution standards, labor benefits, etc. In the current

global economic slow-down which affects almost every country at the

same time, China remains an exception with a projected 7.7 percent

growth for the year 2001. For recent media discussion, see Richard

Ernsherger, Jr., “The Spread of China Inc.,” Newsweek, September 3,

2001, Asian ed. www.msnbc.com/news/619580.asp.

52. RMRB, February 6 and 10, 2001.

53. Russian oil export revenues in the first 5 months of 2000 rose 130

percent to $9.02663 billion, $5.1511 billion more than in the same period

last year, Interfax, July 7, 2000.

54. China Daily, May 29, 2000.

156
55. After the collapse of the Soviet Union, the 7,000 kilometer

Sino-Soviet border is now shared by four independent states: the Russia

Federation, Kazakhstan, Tajikistan, and Kyrgystan. The Russian part

is about 4,300 kilometers long.

56. Tian Zengpei, p. 312.

57. Ibid., p. 329.

58. Shijie Ribao, November 10, 1997, p. 2.

59. Beijing Review, April 29-May 5, 1996, p. 12.

60. Lianhe Bao, February 6, 1995; RMRB, March 2 and 3, 1995, and

December 19, 1996; Reuter and Xinhua, cited by Shijie Ribao, April 18,

20, and 24, 1996.

61. Xinhua, April 18, 1999.

62. Tian Zengpei, pp. 316-17; China Daily, December 18, 19, and 21,

1992; New York Times, December 18 and 19, 1992.

63. Shijie Ribao, November 14 and December 5, 1993; and New York

Times, December 5, 1993.

64. The signed agreement will treat the accidental violations of each

other’s airspace and territorial waters as accidents in order to prevent

escalation of crises. See Shijie Ribao, July 14 and 16, 1994.

65. Ivanov, p. 279.

66. China Daily, June 29, 1993.

67. Lianhe Bao, March 23, 1995.

68. Interview with Valentin Klimov, director general of the Tupolev

Aircraft Technical-Scientific Center, and Viktor Mikhaylov,

Director-General of the largest aircraft building enterprise “Aviastar.”

Itar-Tass, November 1, 1995.

69. Shijie Ribao, January 1 and April 24, 1994.

70. RMRB, June 28, 1995, p. 1. A month before Li’s visit, Russian

Defense Minister Pavel Grachev was visiting Beijing, with the head of

Russian Air Force. The emphasis on cooperation in military technology

during Li’s visit indicated significant progress in this area. The Japan

Times, May 18, 1995.

157
71. RMRB, December 28, 1996.

72. IN 1999, China’s general public was either becoming indifferent

or accustomed to the US “bombing diplomacy” prior to the May 8

bombing. An evening news broadcast which made no mention of

US-British high-tech games over the Iraqi skies would be disappointing

to many in China. In a comedy show on the Chinese New Year’s Eve

national TV program in late February 1999, a newly unemployed young

man was advised not to take his plight too seriously. “If you feel bad, look

at what difficulties Saddam faces; if you are not happy, think what

Clinton is going through.”

73. Press conference for the 9th National People’s Congress, NPC,

by Chinese Foreign Minister Tang Jiaxuan, Beijing Review, March

22-28, 1999, pp. 6-11.

74. Xinhua, June 9, 1999; Reuters, June 9, 1999; Shi Bao (Tokyo),

June 23, 1999.

75. Hong Kong Tiger, June 21, 1999;Shi Bao (Tokyo), June 23, 1999.

76. Izvestiya, “Brothers Forever-2,” June 9, 1999.

77. www.chinesenewsnet.com, February 5, 2001.

78. On the eve of his July 2000 visit to Beijing, Putin reportedly

instructed Russia’s Pacific Fleet to give direct assistance to China if the

situation in the Taiwan Strait deteriorated and if the US military

attempted to intervene. The widely circulated report was never

confirmed by the Kremlin and lower-level Russian officials quickly

dismissed its authenticity. Curiously, China’s official RMRB helped to

spread the rumor once again after Putin’s visit. See Liu Shengzhi and

Ge Lide, “Russia will react if US military intervenes: Putin supports

China’s move to safeguard Taiwan (exclusive report),” Huanqiu Shibao

(Global Times), in www.people.com.cn, July 21, 2000.

79. Both Soviet official data and the CIA estimates indicate a steady

decline of the Soviet economy from the mid-1960s and an accelerated

worsening trend in the 1970s. This trajectory of the Soviet economic

decline happened to parallel the deterioration of Sino-Soviet relations.

In 1960, the Soviets unilaterally withdrew all technical personnel from

China. In 1969, the ideological conflict started to militarize when the

two militaries clashed several times along their borders. Eventually, the

Red Army had to substantially increase its military deployment in Asia,

leading to a de facto two-front strategy. For a recent study of Soviet

158
economic decline, see the article cited above by Brooks and Wohlforth,

pp. 5-53.

80. Conference on the US Alliances with Japan and Korea, Stanford

Asian/Pacific Research Center, September 6-7, 1996.

81. Bin Yu, “East Asia: Geopolitique Into the 21st Century: A

Chinese View,” Occasional paper, Stanford: Asia/Pacific Research

Center, Stanford University, June 1990, pp. 3 and 8.

82. Kennan argued that NATO expansion was “the most fateful

error of American policy in the entire post-cold-war era.” George

Kennan, “No to Expansion,” New York Times, February 10, 1997.

83. For relevant writings, see François Heisbourg, “American

Hegemony? Perceptions of the US Abroad,” Survival, Vol. 41, No. 4,

Winter 1999-2000, pp. 5-19; Peter J. Spiro, “The New Sovereigntists:

American Exceptionalism and Its False Prophets, Foreign Affairs, Vol.

79, No. 6, November/December 2000, pp. 9-15.

159
CHAPTER 8

CHANGING JAPANESE VIEWS OF CHINA:

A NEW GENERATION MOVES TOWARD

REALISM AND NATIONALISM

Tsuneo Watanabe

INTRODUCTION

This past year, Japan issued a visa to the former

president of Taiwan, Lee Teng-hui. It did so despite

considerable pressure from China. Issuing Lee a visa has

been, over the years, a litmus test for Chinese ability to

influence policy decisions in the United States and Japan.

During his presidency, Lee tried to visit both of these

countries. While the United States granted him a visa in

1995, the Japanese did not, out of consideration for Chinese

wishes.

China still regards Lee as “a facilitator for Taiwan’s

independence movement behind the scenes.”1 Hence,

issuing him a visa on this occasion was a political issue in

both the United States and Japan, even though Lee applied

as a private citizen. As in the past, Japanese opinion was

divided. The Pro-China politicians, Foreign Minister Kono,

and the Asian Affairs Bureau of the Ministry of Foreign

Affairs tried to deny Lee a visa. Pro-Taiwanese Prime

Minister Mori, by contrast, insisted on issuing it. In many

ways the political map in Japan was much like the political

map of earlier times. However, there was one striking

difference. Previously, there was a clear split in public

opinion between the pro-China and the pro-Taiwan camps.

This time, the Asahi Shimbun, which is known to be a

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pro-Chinese newspaper, criticized the government for not

issuing a visa for Lee.

2

This event has symbolic importance. It reflects the fact

that Japanese perceptions of China have lately undergone a

very significant change. Both Japanese politicians and the

general public have a rather different attitude towards their

powerful neighbor than they once did. That such a change

exists is quite clear. What is much less clear is how this

change will affect Japanese foreign policy, particularly

given the turmoil that currently characterizes Japanese

political life. The goal of this chapter is to determine the

direction and momentum of changing Japanese views of

China. It will do so by examining both international and

domestic factors.

I. CHANGING ATTITUDES IN JAPAN

The Growth of Realism and Nationalism.

Realism. Japan’s general security policy toward East

Asia has lately undergone significant change. Over the last

decade it faced a series of new challenges. The Gulf War in

1990 and the Taepo-dong missile launch by North Korea in

1998 were key turning points. One way to understand

Japan’s changing perceptions of China is to see them as part

of its overall perceptions of East Asian security. Japanese

policy has, in fact, moved away from rhetorical “pacifism”

and towards realism. It increasingly has come to speak in

terms of becoming a “normal nation.” The word “normal

nation” has been used widely since the Gulf War when

Ichiro Ozawa, Secretary General of the Liberal Democratic

Party (LDP) at that time, advocated it as Japan’s goal.3

Sakutaro Tanino, the former Japanese ambassador to

China, used the term recently, for example, when he

suggested how the Japanese and Chinese might develop a

more constructive relationship. They should, he said, avoid

using an emotional approach to deal with the occasional

issues that arise between “normal nations.”4

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This trend towards general realism can be understood as

a response to the structural changes that took place after

the Cold War. During the Cold War era, Japan concentrated

on maintaining a close security relationship with the

United States. It also focused on developing its economy.

Before 1972 (when China formed a strategic partnership

with the United States against the Soviet Union), Japanese

engagement with China focused on private economic

relations. After 1972, China became the strategic partner of

Japan’s ally. Both before and after 1972 Japan was able to

concentrate on its liberal commercialism and needed to

devote only a minimal amount of money and attention to

defense. This was because it could depend for its protection

on U.S. global strategy.

After the end of the Cold War, however, Japan came to

realize that it no longer could depend on the unlimited

security guarantee formerly provided by the United States.

In addition, highly politicized economic friction arose in the

1980s and the early 1990s between the United States and

Japan. Japan was criticized for getting a free ride and

taking advantage of American security efforts. Since then,

Japan has gradually taken steps towards becoming a

“normal nation” and adopting a realistic defense policy. This

can be seen, for example, in the U.S.-Japan Security Joint

Declaration of 1996, and the agreement to revise the

U.S.-Japan Security Guidelines (1997).

The growth of realism in Japan was also stimulated by

other events, notably in North Korea. Both the 1994 crisis

triggered by North Korea’s development of nuclear weapons

and the crisis in 1998 when it launched a missile into

Japan’s territorial waters helped transform Japanese

thinking and its security policies. Chinese actions, too, have

affected Japanese perceptions and attitudes. The People’s

Republic of China (PRC) has laid claim to the Senkaku

Islands (Diaoyu Islands), over which Japan claims

sovereignty, and has threatened Taiwan with its missiles.

In other words, Japan has been driven towards realism

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wherever it has felt that its vital security interests are at

risk and in response to the aggression of its neighbors.

Two years before North Korea’s Taepo-dong missile

launch, Green and Self described Japan’s China policy shift

as one “from commercial liberalism to reluctant realism.”5

They added “reluctant” since the general consensus in

Japan was that “maintaining friendly ties with China is

essential and that a primarily economic strategy towards

the People’s Republic of China (PRC) still has potential.”6

Since then, Japan’s tendencies toward realism have been

reinforced dramatically, due to a policy shift from

“reluctant” realism to the less reluctant realism of a “normal

nation.”

Nationalism. The other major phenomenon of the times

is the growth of Japanese nationalism. The Japanese people

are frustrated with the prolonged economic slump, the lack

of political leadership, heavy dependency on U.S. policy, and

insecurity in an unstable East Asia. All these things serve

as catalysts for nationalist sentiment among the Japanese.

Several scholars have pointed out that Japan’s policy

toward China was, in times past, managed by pro-China

seniors in the Diet, government, and business.7 These

seniors shared pre-war and wartime experiences with

China. Their attitudes were deeply rooted in their sense of

remorse and regret for Japan’s wartime aggressions.8 They

were to be found in both the conservative ruling LDP and

the opposition parties. Seniors from both the LDP and the

opposition cooperated effectively to promote China policy

against the pro-Taiwan and anticommunist hawkish group

within the ruling LDP.

Now that a new generation of leaders has come to power,

this pro-China sentiment, born out of remorse, has

declined.9 Its place has been taken by nationalism. This

ideology has taken particularly deep root among the

younger generation, although it also has roots in traditional

anticommunist and ethnocentric sentiment. A very visible

example of nationalism is to be found in the work of

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cartoonist Yoshinori Kobayashi. His cartoons, which are

effective communication tools, appeal to the younger

generation. His views echo those of many older generation

nationalists. Kobayashi has used his cartoons to try and

justify Japan’s wartime aggression. He has also written a

book, Taiwan-ron (On Taiwan). It has an oversimplified

political message and expresses pro-Taiwan and anti-China

sentiments. Since November 2000, his series of works called

Gomanizumu Sengen (Declaration of Arrogance), including

Taiwan-ron, have sold over 250,000 copies in Japan.10 The

Japanese are already irritated by several of China’s political

stands. They are irked at its interpretation of recent history

and its repeated criticisms of Japan. This irritation has the

potential to turn nasty. Japanese frustration with the

prolonged economic slump or lack of domestic political

leadership might easily spawn patently anti-Chinese

sentiment.

Sino-Japanese relations in 1980s and 1990s: A

Decline in Good Feelings.

The Japanese Cabinet office has taken a poll recording

the ups and downs of Japanese attitudes towards China.

The polls show a general downward trend. (See Figure 1.)

This poll was based on 3000 face to face interviews of

Japanese over the age of 20. In 1980, 78.6 percent of the

Japanese people had “positive feelings” towards China,

whereas 14.7 percent had “negative feelings.” In 2000, 48.8

percent Japanese had “positive feelings,” whereas 47.2

percent had “negative feelings.”11 In general, Japanese have

tended to look less kindly upon China since 1978.

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Japan and China: Pivotal Events, 1978-2000.

1978 Japan-China Peace Treaty.

1979 Implementation of Official Development

Assistance (ODA).

1981 Japan-China joint construction project

(Bao-shan steel complex)cancellation issue.

1982 President Zho Ziyang visited Japan: the first

“history text book” criticism.

1984 PM Nakasone visited China.

1985 Text Book Issue, Chinese Student Protest

against Japan’s cabinet member’s official visit to Yasukuni

Shrine (war criminals are there).

1987 Issue of Japan’s defense budget exceeding 1

percent of GNP, “Kouka-ryo” (Guanghua) Hostel Issue.

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Figure 1. Japan’s Prime Minister’s Office Poll— Do

You Have a “Close Feeling” towards China?
1988 Visit of PM Takeshita: Promise of 810 Billion

Yen for ODA in 1990s.

1989 Tiananmen Square Incident, Japan stopped

ODA.

1990 Japan resumed ODA. China’s nuclear Test.

1992 Emperor Akihito’s successful visit to China.

1995 China’s nuclear test; Japan suspended ODA.

1996 Taiwan missile crisis. Yasukuni Shrine issue.

Senkaku (Diaoyu) islands territorial dispute.

1997 PM Hashimoto visited China: Controversy

over the US-Japan security guideline.

1998 President Jiang Zemin’s Visit to Japan:

Frequent references to Japan’s wartime aggression.

1999 PM Obuchi’s visit to China (conducted very

smoothly and historical issues were not mentioned).

2000 Japan protested Chinese military vessels

entering Japan’s EEZ (Exclusive Economic Zone).

Sino-Japanese relations have experienced a cyclical

upturn and downturn since normalization in 1972.12

Changing attitudes can often be linked to specific events. In

1978 the Sino-Japanese Peace Treaty was signed: this

marked the apogee of “positive feelings.” Of the Japanese

population, 78 percent regarded China in a positive light at

this time. Prior to this, Japanese society placed high priority

on improving relations with China and so, consequently,

there was considerable desire for friendship between the

nations. The initial upward curve in the 1970’s cooled with

China’s unilateral cancellation of the Bao-Shan joint steel

construction project in 1981.13 In the 1980’s, the Japanese

continued to feel rather positive towards China despite

occasional conflicts. Japanese irritation over Chinese

criticism of its history books was a case in point. The positive

attitudes towards China owed much to Official

Development Assistance (ODA) and the trade boom. A

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sudden decline in the good feelings came in 1989 when the

Chinese military repressed civic demonstrators in

Tiananmen Square. Since then, positive feelings have

gradually recovered. They reached a high point in 1992, a

year marked by the successful visit of the Japanese

Emperor to Japan. This slight recovery was followed by

another decline in Japanese regard for China precipitated

by a series of negative events, such as China’s nuclear tests

in 1995 and the missile launches in the Taiwan Strait in

1996.

Interpreting Changing Attitudes.

Why do the Japanese feel less positive about China today

than they did in the past? The most likely explanation is

that the decline in good feelings is related to the rise of

nationalism and realism. However, the downward trend

does not mean that relations between China and Japan

have been deteriorating in a straight line ever since 1989.

To the contrary, economic relations between Japan and

China have actually been strengthened. China, in fact, was

Japan’s second largest trading partner in 1999. The total

amount of trade was $66.6 billion, which represents an

increase from $22.8 billion in 1991 and from 1.1 billion in

1972.14

The positive attitude felt by the Japanese towards China

in the late 1970s and 1980s owed itself in large measure to

two things. First, Chinese leaders proved very skilful at

diplomacy and public relations and were able to create a

good image of China among the Japanese people. Second,

the Japanese people came to share with business and

political leaders high expectations of developing business

opportunities in China. As Okabe points out, Mao’s

generous expressions of forgiveness for Japan’s past

aggression helped the Japanese feel more friendly towards

China, even though few Japanese believed that his

comments were entirely sincere.15 Prime Minister Zhou

En-lai’s decision to give up demands for reparations from

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Japan was a skilful public relations move that, at the same

time, secured Sino-Japanese economic cooperation.16

As the Japanese leaders and people gained a more

realistic appreciation of the nature of Sino-Japanese

relations, “positive feelings” declined. This long-term trend

was visible throughout the late 1980s and 1990s. This is not

to say, however, that the views were, when seen in a broader

perspective, particularly negative. About 40-50 percent of

Japanese respondents at the time indicated that they had

positive feelings towards China. A similar poll taken by the

Japanese Cabinet Office reflected very similar attitudes

towards other nations. The Japanese were as negative or

more negative about all other countries, with the exception

of the United States, which consistently was favorably

viewed by 70 percent of those polled. The Association of

Southeast Asian Nations (ASEAN) and the European

Union (EU) countries were regarded with positive feelings

by almost 40 percent of those interviewed, Russia by a mere

10 to 15 percent.

The Chinese image of Japan has been far less favorable

than the Japanese views of China. Although there is no

exact counterpart of the Japanese poll we have been

studying, we can find a rough equivalent. This poll, taken in

1997 looked at the views of Chinese citizens in Beijing. Of

the respondents, 41 percent hated Japan, 35 percent were

“neutral,” 10 percent liked Japan, and 10 percent answered

“other” or “no answer.”17 This suggests that, even though

modern-day Japanese perceptions of China are less

favorable to the Chinese than they once were, they,

nonetheless, are better than the perceptions of Japan

among the Chinese.

Thus, the long-term downward trend in positive feelings

towards China may merely reflect the fact that the

Japanese people are adjusting their “inflated” high

expectations of China to the realities of the Sino-Japanese

bilateral relationship.

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Although “realism” as a political science concept is not

simply to be equated with the tendency to be realistic as

opposed to idealistic, this tendency is certainly one of its

aspects. It is also important to point out how alien “realistic”

thinking was to to the average Japanese. It stemmed from

the strong anti-military sentiment of Japanese society and

the relative sense of security felt by the Japanese after

World War II. Hisahiko Okazaki, the former Japanese

Ambassador to Thailand and Saudi Arabia, sheds some

light on this. He reported an interesting observation that he

heard from an American scholar while attending a

conference in New York. The United States, this scholar

noted, is not as seriously threatened by the Soviet Union as

is Japan, but it feels insecure. Japan, by contrast, is

vulnerable but does not feel threatened by the Soviet

Union.18 As for Japan’s reaction toward China as a potential

threat, Yoshihide Soeya points out that “the Japanese

government found “containing China” to be the most

troublesome aspect of the U.S. Cold War strategy in Asia”

because they knew that China was a ‘small universe’ unto

itself.”19

In 1995, Fuji Sankei-USA Today Joint Poll asked both

Japanese and Americans, “Do you see China as a military

threat?” Only 9 percent of the Japanese citizens, as

compared to 42 percent of U.S. citizens, answered that

China was a military threat. (Unfortunately, the poll has

not been updated so we cannot tell if there has been a more

recent shift in perception).

Changing Japanese Perceptions: Key Factors.

At this point, we should consider what factors have

contributed to Japan’s changing perceptions of China.

Seven stand out.

1. Geopolitical Dynamics. The new geopolitical

dynamics that followed the end of the Cold War had a major

impact. The major objective of the U.S.-China strategic

partnership had been to form an alliance against the Soviet

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Union. Once that objective disappeared, China no longer

shared a vital interest in the U.S.-Japanese alliance.

Mochizuki points out that the only useful purpose the

alliance could serve China, now that the Soviet Union had

collapsed, was to contain Japan.20 At the same time, Japan

started to strengthen its military ties with the United

States in order to reinforce its own security because it was

worried that the U.S. military might disengage from East

Asia.21 After the Cold War, the Asian security environment

was much more fluid and tense. We should note, in

particular, the North Korean nuclear crisis in 1994 and the

Taiwan crisis in 1996. All this led to renewed Sino-Japanese

rivalry.

2. Domestic political developments. Internal

developments in Japan also had a large impact on Japan’s

perceptions of China. Powerful conservative politicians,

such as Kakuei Tanaka, Masayoshii Ohira, Noboru

Takeshita (all former prime ministers), and Masaharu

Gotoda (former chief cabinet secretary),22 who had played a

key role in managing ties with Chinese leaders, retired. The

decline of the Social Democratic party (formerly, the Japan

Socialist Party) also played a role. This party had, in the

past, contributed towards Japan’s conciliatory approach to

China. Japanese leaders were now less influenced by either

sympathy for Marxist ideology or deep remorse for Japan’s

wartime aggression.

3. Chinese Actions. A series of events in China in the

1980s and 1990s gave the Japanese a more negative image

of China. The Tiananmen Square incident in 1989, nuclear

tests in the face of strong warnings from Japan in 1995, and

the missile launch toward the Taiwan Strait in 1996, all had

a huge impact on the Japanese. These events undermined

sympathy among groups who had previously supported the

Chinese, notably among Japanese liberals and pacifists. 23

4. Japanese Economic Slump. The prolonged economic

slump experienced by Japan in the 1990s also played a role

in changing attitudes towards China. So serious was this

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decline that the Japanese speak of the “Lost Decade.” It

followed the bursting of the “bubble economy,” which had

been based on risky speculation in real estate. With

continuing economic stimulation policies and a decline of

tax revenue, Japan’s fiscal budget deficit has ballooned.

In Fiscal Year (FY) 2000, its deficit level reached 14

percent of gross domestic product (GDP), which is well over

the warning level of the International Monetary Fund

(IMF). In these dire circumstances, the Japanese

government and taxpayers started to rethink Japan’s

financial assistance policy such as Official Development

Assistance (ODA), which consists of both grants and loans.

The major target was China, which has been the largest

recipient of Japan’s financial assistance. Since 1979, when

Ohira announced Japan’s yen loan to China,24 ODA aid to

China totaled 2,688 billion yen up to FY 1999. In addition to

the ODA money, the Japan Bank of International

Cooperation officially loaned China 3,428 billion yen, and

gave it a supplier credit guarantee up to FY 1999.25

In addition, greater realism forced Japan to

acknowledge the lack of transparency in the Chinese

government’s spending of ODA money. Yoshihisa Komori,

the former Beijing bureau chief of Sankei Shimbun, asked

why Japan had to spend huge money on ODA for China’s

government, who showed little appreciation for the money,

was not held accountable for how it was spent, and all the

while was undergoing rapid military modernization.26

These appeals were supported by Japanese taxpayers,

who were suffering from recession. The ruling LDP sensed

the voters’ anger. In FY 2000, Japan’s Ministry of Foreign

Affairs (MOFA) reviewed its ODA to China, which

amounted to $1,226 million dollars in FY 1999. The ODA

White Paper in 2000, published by the MOFA, expressed

Japanese concerns about China’s military expansion, naval

activity in Japan’s Exclusive Economic Zone (EEZ), and

China’s increasing assistance to other developing

countries.27 Budget pressure even led Japan to reduce the

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payment it gave as host-nation to its major ally the United

States. In July 2000, Prime Minister Mori and President

Clinton agreed to reduce by 2 percent the $1.5 billion that

Japan paid in support of the U.S. military personnel

stationed in Japan.28

5. The History Card. Japanese opinion of China also

declined thanks to the frustration felt over China’s repeated

playing of the “history card.” Japan is tired of apologizing.

According to Komori, the Japanese started to feel that

China would never stop criticizing Japan and demanding

apologies even though Japan has expressed remorse and

implied regret by providing economic assistance to China.29

During President Jiang Zemin’s visit to Japan in November

1998, he repeatedly criticized Japan’s interpretation of its

own history. At the same time, he failed to express any

appreciation for the 390 billion yen in economic assistance

recently given by Japan. This so frustrated the Japanese

that Prime Minister Obuchi refused to meet Jiang Zemin’s

demands. He did not include an apology in the joint

communiqué. This is all the more interesting in that Japan

had agreed to include an apology in the joint statement

made with South Korean President Kim Dae-Jung. Kim had

shown the wisdom and foresight to propose that the two

countries put an end to their differing interpretation of the

Japanese past. Significantly, few pro-China legislators or

pro-China journalists criticized Prime Minister Obuchi and

his government for this decision. Komori points out that this

stands in marked contrast to their reactions on earlier

occasions when the Japanese pro-China camp loudly

criticized the fact that the government had failed to

apologize to China.30

6. Crime. Negative images of China also result from the

public perception that illegal immigrants are responsible

for the increase of crime in Tokyo. Conservative Tokyo

Governor Ishihara used the controversial word

Daisangokujin (literally, “the third country people”), when

referring to the increasing number of crimes committed by

illegal immigrants in Tokyo. The comment drew a great deal

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of criticism, because it reminded listeners of the

discrimination against Taiwanese, Chinese and Korean

residents immediately after World War II. Nonetheless, the

sentiment appealed to Tokyo dwellers frustrated with the

increasing crime-rates.

A large number of Chinese have been involved in these

crimes. A 1999 police white paper focused its attention on

crimes by foreigners. Its subtitle was “fighting crime beyond

national borders.” According to the white paper, 34,398

cases involved foreigners in 1999. This represents an 8.2

percent increase from the previous year and a six-fold

increase over the course of the last decade. Of 13,436

foreigners arrested, 5,352 (40 percent) were Chinese

nationals. The rest were Iranian, Filipino, and others.

7. Business Difficulties. Recently, more Japanese have

become aware of some of the problems involved in doing

business with China. These include government corruption,

frequent change of laws, and inadequate protection of

intellectual property rights.31 Japan’s positive views of

China have historically sprung from the fact that it has

economic interests in the country and both trades with it

and invests in it. However, as the two economies have

become more closely integrated, Japanese businesses have

become increasingly aware of the shortcomings of Chinese

businesses and markets. A clear indication of this changing

attitude was the withdrawal of Yaohan from the Chinese

market. The activities of this Japanese retail business in

China were once regarded as a successful investment

model.

II. CHINA POLICY

Japanese Leaders.

The leaders of Japan seem to be adopting a changing

attitude towards China. Their views are moving away from

liberalism to realism and nationalism. In the past, elder

politicians on the political right and left shared a sense of

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remorse for Japanese wartime actions, and this guided their

reactions to China. The majority were sympathetic towards

China. There was a general consensus that the Japanese

should be conciliatory when it came to the quarrels over

Japanese text books, and liberal when it came to providing

ODA aid.

Historically, the conservative LDP has been divided into

two opposing camps when it comes to a China policy. A third

group of LPD members hold the middle ground. First, there

is an anticommunist, pro-Taiwan, and nationalist group in

the LDP. This group includes such persons as former Prime

Ministers Nobusuke Kishi and Takeo Fukuda, the present

Tokyo governor Shintaro Ishihara, and the former secretary

general of the Upper House, LPD, Masakuni Marakami.

Second, there is a pro-China and liberal group in the LDP.

This group includes such men as Kenzo Matsumura, the

former Prime Minister Masayoshi Ohira, former Foreign

Ministers Masayoshi Ito and Yohei Kono, and former

Secretary General Koichi Kato.

Within the LPD, there are also some Japanese

politicians who are less ideologically motivated in their

views and tend to hold the middle ground. They are

pro-China realists. Their approach is pragmatic. They

include such members as the former Prime Ministers

Kakuei Tanaka and Noboru Takeshita, the former Chief

Cabinet Secretary Seiroku Kajiyama, and the former

Secretary General Hiromu Nonaka. These men played

kingmaker in regards to China policy and were major

stabilizers in the China debate.

To date, the coalition of pro-China liberals and

pro-China realists has prevailed in China policy. Its success

resulted in part from an alliance with pro-China, left wing,

opposition parties, which enjoyed a close relationship with

China. This included the Socialist Party and Komeito, a

party supported by the largest Buddhist organization. This

kind of coalition can clearly be seen in the case of the

Sino-Japanese normalization process in 1972. On this

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occasion pro-China realists and Prime Minister Tanaka

took the initiative, working in cooperation with pro-China

liberals such as Aiichiro Fujiyama and the Socialist Party

ex-Chairman, Kozo Sasaki and Komeito Party Chairman

Yoshikatsu Takeiri.32

Recently, this coalition between realists, liberals, and

the left, which has resulted in a generally pro-China policy,

has weakened somewhat. Old conservatives who shared a

sense of remorse and guilt about China are retiring and are

less influential in the LDP. The new generation of

conservatives, which includes men such as former Vice

Foreign Minister Keizo Takemi, feel much less guilt than

their predecessors, and are more focused on securing

Japan’s national interests. The left, which shared a Marxist

ideology with China, is losing its power thanks to the world

wide decline of socialism and communism. Liberals have

become more aware of the undemocratic nature of the

Chinese regime and are antagonized by that country’s

violation of human rights, which was vividly brought to

their attention by the Tiananmen Square incident. Both

liberals and conservatives have been stirred to greater

pragmatism by the harsh realities and instability of East

Asia in the wake of the Cold War. The new generation of

leaders, including the President of the Democratic Party,

Yukio Hatoyama, tend to base their policies on geopolitical

realities.

It is very difficult precisely to determine how the

political landscape will shape China policy. The current

situation is extremely fluid. However, there is a general

shift among politicians towards realism, which can be

traced when we examine the attitudes and views of

individual politicians.

1997 U.S.-Japan Security Guidelines: The Debate of

Kajiyama vs. Kato.

One way to gage the shift towards realism in Japan is to

examine the different reactions of LDP politicians to the

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“Review of the Guidelines for U.S.-Japan Defense

Cooperation” in July 1997. These guidelines broadened the

scope of U.S.-Japanese cooperation. Specifically, the new

guidelines called for “cooperation in situations in areas

surrounding Japan that will have an important influence

on Japan’s peace and security." Controversy has focused on

the reference to situations in areas surrounding Japan,

which was not covered in the 1978 guidelines.33

Prior to the 1997 Guidelines, Japan had no plans for

cooperation between its Self-Defense Force and the U.S.

forces outside of the territory of Japan. This restraint

sprang in part from Japanese desire to reassure its

neighbors and domestic opposition groups, who feared a

revival of Japanese expansionism. During the Cold War,

moreover, the most widely anticipated scenario was a direct

attack on Japanese territory from the north. The changing

geopolitical environment, specifically the disappearance of

a U.S.-China strategic partnership directed against the

hegemony of the Soviet Union, thus served as a catalyst for

change.

The 1997 Security guidelines caused some concern in

China. Japan was, in fact, careful to avoid violating what

some interpret to be a constitutional ban to exercise its right

to collective defense. It made no plans to cooperate with the

United States in anything other than noncombatant

activities. It proposed to cooperate only in such areas as (a)

relief activities for refugees, (b) search and rescue,(c)

noncombatant evacuation operations, (d) inspection of ships

in support of United Nations (U.N.) economic sanctions, and

(e) rear area support for the U.S. forces.34 Japan was careful,

moreover, to specify that it would not include weapons and

ammunition among the supplies it gave to the United

States. However, the strategic shift reflected in the

document was worrying to China. It meant that, in theory at

least, Japan could now support U.S. operations in a Taiwan

Strait contingency.35

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The fact that the guidelines were accepted makes it clear

that the pro-China consensus between “liberals” and

“realists” was beginning to break down. In his official visit to

China in 1997, LDP Secretary General Koichi Kato

explained to Chinese officials that the U.S.-Japan Security

Guidelines target not China, but North Korea. His comment

threatened to get Japan caught in the Taiwan contingency

between conflicting obligations to China and the United

States. Immediately after Kato’s comment, Seiroku

Kajiyama, Chief Cabinet Secretary of the government

commented that the guidelines for U.S.-Japan security

cooperation would not exclude the Taiwan Strait. These two

comments suggest the growing divide between liberals and

realists.

Koichi Kato is known as one of the major “pro-China

liberal” Diet members. He argued that the

“U.S.-Japan-China relation should be an equidistant

triangular relationship,” a view criticized by supporters of

the U.S.-Japan alliance.36 His record as a China supporter is

spotless. In the first place, he succeeded as leader of the

political faction Kochikai, which included major pro-China

politicians such as the former prime minister Masayoshi

Ohira and the former foreign minister Masayoshi Ito.37 In

the second place, during the course of his career as a

bureaucrat, he specialized in Chinese affairs. Before

running for national election, Kato worked for the Ministry

of Foreign Affairs for 7 years, holding a number of positions

within the Asian Affairs Bureau China Section. He served

in the Embassy in Taipei before the Japan-China

normalization in 1972 and as a Deputy Consul General in

Hong Kong.

Kato’s wording reflects his liberalism and his lack of

realism. In the following speech (1999), it is clear that,

although he speaks of the importance of the U.S.-Japan

alliance, he is, in fact, trying to down-play the military

aspect of U.S.-Japan relations and limit Japan’s role in

international security.

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As allies, Japan and the United States need to take into

account China’s sensitivities and its internal dynamics....

Looking at the broader context, the U.S.-Japan alliance

should not be thought of as simply a military alliance. It is

a STRATEGIC alliance in the broader sense of that term.

... At the same time, we need to develop consultative

arrangements that reflect the vital importance of the

trilateral U.S.-Japan-China relationship.... Japan’s

constitutional constraints effectively rule out any military

intervention, something that our public, to say nothing of

our neighbors, wish to see preserved.38

On the other hand, Seiroku Kajiyama’s political

background is as a “pro-China realist.” As a member of

Keiseikai (formerly, the Tanaka faction), which initiated

normalization of relations between Japan and China,

Kajiyama has enjoyed close relations with China. He is

inclined towards both realism and selective,

interest-oriented support of China, and he distances

himself from pro-Taiwan, nationalist stances.

Kajiyama’s comment in the security guideline

represents a realistic tendency in Japanese leaders. In his

recent book, “Hakai to Sozo”(Destruction and Creation), he

stresses that Japan should not make concessions which

might jeopardize Japan’s vital national security interests.

While he does not deny that Japan owes China a historical

debt, he also insists that the Japanese should not give up the

U.S.-Japan security alliance, or Japan-Russia relations.

Unfortunately, emotion over historical events remains a

major factor in (Sino-Japanese) diplomacy in a way that is

not true of U.S. China relations. Japan did great damage

to China until the end of World War II in 1945. It is natural

for the victim to remember the actions of the aggressor,

and for the aggressor to forget them. Japan must pay for

this in its bilateral relationship with China. However,

Japan also must avoid adopting policies that threaten

Japanese survival.39

Kajiyama did not become part of the political

mainstream. He left the Keiseikai faction to run in the LDP

presidential election against a faction leader, Keizo Obuchi,

179
in 1998. Still, his realism is shared by younger, conservative

politicians, both within and outside the LDP.

Changing Perceptions among the New Generation.

In his work on China, the former Beijing bureau chief of

the Sankei Shinbun, Yoshihisa Komori, pointed out that

Japanese views on China were a little unusual when

compared with those of other industrialized democracies.

First, the Japanese were surprisingly silent about China’s

military development. They said little, for example, about

China’s increased expenditures on nuclear weapons and

missiles. Second, the Japanese refrained from comment on

China’s human rights violations and antidemocratic

practices. Thirdly, they caved in to Chinese criticisms of

Japanese security policy and its interpretation of history.40

The new generation no longer behaves this way.

New Realist Tendencies among Conservatives. Keizo

Takemi is a member of the Upper House of the LDP. He

holds a doctorate in International Relations (with a focus on

Asian studies). He studied at the University in Taiwan and

was previously a professor at Tokai University. His solid

political position is based on support from the powerful

interest group—the Japan Medical Association—on which

his father had served as chairman. He has built up support

networks both in China and Taiwan. Thanks to these

advantages, Takemi has become one of the expert Diet

members, and has played an important decision making

role in the LDP.

Takemi’s views on China illustrate the new realist

tendencies to be found among Japanese conservatives. His

attitudes towards Japanese security combine elements of

Kajiyama’s realism and the pragmatism of the younger

generation.

Takemi’s views of China are clearly based on geopolitical

considerations and reflect the analytical approach of the

realists.

180
Japan’s highest priority must be to maintain the current

military balance. The U.S. military presence in the

Asia/Pacific region is vital. Close cooperation between the

United States and Japan is needed in order to prevent

military expansion and preserve stability in the region.

Unfortunately, China does not see the U.S. presence as a

stabilizing force in the region. A security dialogue between

Japan and China is very important to ensure strategic

cooperation through confidence building measures. 41

Takemi, in contrast to earlier conservatives, has noted

that China’s military development is important.

What I am worried about is that China is the only nuclear

country which is still strengthening its nuclear capability

by developing and deploying both short-range and

mid-range missiles. Russia is developing mid-range

missiles but only a few short-range missiles. I would like

China to have more transparency in regard to its military

capability and thereby ease its neighbors’ fears.42

Birth of New Liberals as Pro-Taiwan and

Pro-democracy: Independent Governors, Unaffiliated

Voters, and Liberals in the Democratic Party. Interestingly,

Takemi’s views reflect two new political trends. Both of

these, if they result in policy-changes, would lead the

Japanese to take a tougher position on China. On the one

hand, a new group can be found among traditional

conservatives whose goal it is to strengthen the Japanese

sense of national identity in an increasingly global world. As

Takemi points out, Tokyo Governor Shintaro Ishihara

attracts support from those who are alienated by

globalization. Because he adopts a tactically distant

position from the unpopular ruling party (the LDP) and

thanks to his skill at public relations, he is regarded as a

future Japanese leader in spite of (or because of) his

nationalistic posture.

On the other hand, there is a new liberal camp. Members

uphold individualistic values and would like to create a

“civil” society of sorts. They are in their 30s and early 40s. In

contrast to the previous generation of Japanese liberals,

181
they are free from both a superiority complex toward Asia

and an inferiority complex toward the United States and

Europe. Governor of Kochi Prefecture, Hashimoto,

Governor of Miyagi Prefecture, Asano, and Governor of the

Nagano prefecture, Tanaka, are attracting the support of

these young people.

Today’s unaffiliated voters include members from both

these camps. According to Takemi, they appreciate the

value of freedom and democracy and are concerned about

Chinese human rights violations. They tend, therefore, not

to be very happy about the status quo when it comes to

China.43

The views on China and Taiwan held by younger

members of the largest opposition group, the Democratic

Party of Japan (DPJ), reflect a new trend. The DPJ is a

relatively young party, which was founded in 1996 by

individuals of varied background. Included among them

were liberal conservatives who once belonged to the Liberal

Democratic Party (e.g., current DPJ party leader, Yukio

Hatoyama); the centrist Social Democrats (e.g., the current

DPJ second in command, Takahiro Yokomichi); and several

civic movement leaders, such as the current secretary

general, Naoto Kan. In 1998, they were joined by

conservative labor union-based Democratic Socialists (e.g.,

vice leader Kansei Nakano) and former conservative LDP

members (e.g., the former prime minister Tsutomu Hata).

Due to the fact that its members come from a large

variety of backgrounds, the DPJ does not have a clear party

stance on China. However, there is a movement within the

party to change its relationship with China. Komori, we

noted, drew attention to the rather unusual silences and

concessions which characterized traditional Japanese

policies. This pro-China bias is no longer as clearly in

evidence in the DPJ.

The DPJ established a close relationship with the

Democratic Progressive Party of Taiwan, in particular after

party leader Hatoyama established a close personal

182
relationship with the new president Chen Shui-bian.44 The

DPJ are more sympathetic towards Taiwan’s democracy

than are traditional Japanese liberals with Chinese

socialism.45 The party is also critical of China’s human

rights issues. In fact, Hatoyama unofficially met the Dalai

Lama in Tokyo in April 2000. The Chinese government is, of

course, very nervous about the Dalai Lama because of the

role he is playing to bring about Tibetan independence.46

Hatoyama is known as one of those Japanese who would

like to amend the so-called “renunciation of war” clause

(that is, article 9 of the Japanese constitution).47 In this, he

follows in his grandfather’s footsteps. In the 1950s

conservative Prime Minister Ichiro Hatoyama, did likewise.

However, despite taking a relatively realistic stance on

security policy, the DPJ has tackled Japan’s past history in

a positive fashion. For example, the DPJ proposed a bill to

enable the establishment of the Permanent Peace Research

Division in the National Diet Library. This organization

was charged with tackling the historical facts on war

atrocities.48 Whether this attempt is viewed as pragmatic or

liberal, it reflects the change within the DPJ. Older liberals

avoided facing the contradiction between the Japanese

renunciation of war and the existence of Self-Defense

Forces. Older conservatives avoided facing Japan’s

war-past. New liberals and conservatives do not.

Policy Implications.

Because of the highly unpredictable political situation, it

is almost impossible to speak with any certainty of future

political realignments in Japan. However, the changing

attitudes of the Japanese public and their leaders do

suggest the direction in which Sino-Japanese relations are

moving.

Whether we are looking at liberals or conservatives, it

seems that the younger generation is likely to take a more

realistic approach towards Asian security. They are more

likely to take into consideration geo-political realities and to

183
be less emotional in their reactions to both Taiwan and

China. The new generation, freed of wartime memories, is

likely to be freer from ideological sentiment and show less

antipathy towards either the Chinese Communist Party or

Taiwan’s Nationalist Party. Nationalists are likely to feel

justified by the passage of time to forget the past. Liberals

may feel less pressure to do so. In the end, the new

generation is likely to base its decisions on political

calculations rather than on historical memories or ideology.

Japan is moving towards becoming a “normal nation”

both in terms of its security policy and diplomacy toward

China. This means playing a more active role in defense,

providing less money, and being generally less conciliatory

towards China, especially when it comes to apologizing for

the Japanese past.

Nationalism has fueled this shift toward realism. It is

not quite clear how nationalism and realism will interact.

On the one hand, excessive nationalism has the potential to

destroy this realism, as nationalism itself can be an

emotionally charged ideology. On the other hand, realism

may provide enough cool-headed calculation to burst the

nationalist bubble and contain the growth of emotionalism.

In the latter case, the realist tradition will continue to be a

force for stability and contribute towards a constructive

Japanese policy towards China.

ENDNOTES - CHAPTER 8

1. Quotation from a spokesman of the Ministry of Foreign Affairs of

China, Yomiuri Shimbun, April 23, 2001.

2. Asahi Shimbun, Editorial, April 12, 2001.

3. According to Ozawa, a “normal nation” is a nation that (1)

willingly shoulders those responsibilities regarded as natural in the

international community, and (2) cooperates fully with other nations in

their efforts to build prosperous and stable lives for their people. Ichiro

Ozawa, “What is a ‘normal nation’?" Blue Print for Japan, Book II,

Chapter I, Tokyo, New York, London: Kodansha International, 1994,

pp. 93-95.

184
4. Interview: Ambassador to China, Sakutaro Tanino “Nicchu wa

Futsuuno Kuni doushi o mezase” (Sino-Japan relations should be the

relations between “normal nations”) Sankei Shimbun, December 8,

2001.

5. Michael Green and Benjamin Self, “Japan’s Changing China

Policy: From Commercial Liberalism to Reluctant Realism,” Survival,

Vol. 38, No. 2, Summer 1996, pp. 35-58.

6. Ibid., p. 36.

7. Yuji Osaki, “Aratana Nicchukankei no Kochiku“ (”Rebuilding

Sino-Japanese Relations"), in Nihon, America, Chugoku-Kyocho eno

Scenario (Japan, America, China: Scenario for Cooperation), Kokubun

Ryosei, ed., Tokyo: TBS Britannia, 1997, pp. 183-184.

8. In his interview with Japanese government officials, Whiting

found that a major incentive for Japan’s generous financial assistance to

China was Japanese war-remorse. This motive was reflected in such

statements as, “We owe it to China. We must help after all the damage

we did to them.” Allen S. Whiting, China Eyes Japan, Berkley, Los

Angeles and London: University of California Press, 1989, p. 123.

9. Chester Dawson “Flying the Flag,” Far Eastern Economic Review,

May 20, 1999, p. 36.

10. Howard W. French “Japan’s Resurgent Far Right Tinkers With

History," The New York Times, March 25, 2001.

11. The question, “Do you have a ‘close feeling’ toward China?” in the

poll does not have an exact idiomatic equivalent in English. “Close

feeling” is a translation of the Japanese word “Shinkinkan,” which

describes “a positive, close, individual relationship.”

12. Osaki, p. 180; Akihiko Tanaka, Nicchu Kankei 1945-1990

(Sino-Japanese Relations, 1945-1990), Tokyo: Tokyo University Press,

1991, p. 165.

13. In January 1981, the Chinese government unilaterally notified

the Japanese of the cancellation of the construction of the Bao-shan

steel complex. This was a joint project and already under construction.

The Japanese criticized the Chinese for their breech of international

business law, and China reacted to this emotionally. Tensions persisted

until a compromise was reached in December 1981. Tanaka, pp.

114-115.

185
14. Trade statistics by Ministry of Finance of Japan. See

http://www.mof.go.jp.

15. Tatsumi Okabe, “Nicchukankei no Kako to Shourai” (The Past

and Future of Sino-Japanese Relations), Gaiko Forum, February 2001,

pp. 12-13.

16. Green and Self, p. 41.

17. Asahi Shimbun, June 9, 1997.

18. Hisahiko Okazaki, Senryakuteki Sikou toha Nanika (What is the

Strategic Thinking), Tokyo: Chukoshinsho, 1983, p. 12.

19. Yoshihide Soeya, “Japan: Normative Constraints Versus

Structural Imperatives,” in Asian Security Practice, Muthiah Alagappa,

ed., Stanford: Stanford University Press, 1998, p. 190.

20. Mike Mochizuki, “Japan-China Relations: Collision Course or

Shift to Normalcy?” in China-Japan Relations: Old Animosities, New

Possibilities, Woodrow Wilson International Center for Scholars, Asia

Program, January 2001, p. 12.

21. Ibid. p. 12.

22. Ibid. p. 13; Osaki, pp. 183-184.

23. Editorial, “Tenanmon Hiroba no Ryuketsu-o Kanashimu”

(Feeling Sorry for the Bloodshed of Tiananmen Square), Asahi

Shimbun, June 5, 1989. “We strongly demand that China return to

democratic processes to solve the problem, and to receive both domestic

and foreign understanding and cooperation.” (Translation by the

author.)

24. Tomoyuki Kojima, “Chugoku o Sekininnaru Taikoku ni

surutameni” (Persuading China to be a responsible great power), Gaiko

Forum, February 2001, p. 38.

25. The Export and Import Bank of Japan merged with Oversea

Economic Cooperation Fund and became the Japan Bank of

International Cooperation in 1999.

26. Yoshihisa Komori, “Peking Hodo 700-nichi” (Seven Hundred

Days of Reporting From Beijing), Tokyo: PHP Institute, 2000.

27. Sankei Shimbun, March 31, 2001.

186
28. The Washington Post, July 22, 2000.

29. Komori, p. 202.

30. Ibid., p. 201.

31. Ibid., p. 203.

32. Quansheng Zhao, Japanese Policy Making: The Politics Behind

Politics, Hong Kong, Oxford and New York: Oxford University Press

1995, pp. 92-99. Zhao uses the name of Komeito as Clean Government

Party (CGP) in the book. The book does a good job describing the role

played by the opposition parties in the normalization of Sino-Japanese

relations.

33. Japan Defense Agency, Defense of Japan 1997, pp. 168-169.

34. Ibid. pp. 331-332.

35. Nicholas D. Kristof, “For Japan, A Quandary On Pleasing Two

Giants,” The New York Times, August 24, 1997.

36. Hisahiko Okazaki, the former Ambassador to Thai and Saudi

Arabia, remarked that Kato’s perception will mislead Japan. Hisahiko

Okazaki, “Fuanna Koto-shi no gaikouteki gendo” (Anxiety Concerning

Mr. Kato’s Diplomatic Rhetoric), Sankei Shimbun, July 14, 1998. An

English translation of this article entitled, “Koichi Kato’s Mistaken

Ideas,” can be found in The Japan Times, July 16, 1998.

37. The LDP’s factions’ role in shaping foreign policy is debated.

Most analysts do not think that divisions are drawn along policy lines.

However, Akihiko Tanaka suggests that the “Seiwakai”faction contains

a preponderance of pro-Taiwan members while the “Kochikai” and

“Keiseikai” factions tend to include more pro-China members, although

the factions did not move in accordance with their positions on China

and Taiwan. Tanaka, pp. 198-204.

38. Kato’s speech, “A Tour d’Horizon of Japan’s Foreign Policy” was

given at the U.S.-Japan Dialogue on Asia, in Tarrytown, NY, May 21,

1999. The speech can be found on Kato’s web page at

http://www.katokoichi.org.

39. Seiroku Kajiyama, Hakai to Sozo (Destruction and Creation),

Tokyo: Kodansha, 2000, p. 221. Translation by author.

40. Komori, pp. 193-200.

187
41. Keizo Takemi, Interview, “Nicchukankei Shinraikankei wo

Doukouchikusuruka” (Japan-China Relations: How to Create Mutual

Trust), Sekai, March 2001, p. 93. Excerpt translated by author.

42. Excerpt translated by author.

43. Takemi, p. 89.

44. “Nittaikan nimo ihen: Jimin kara minshu?” (Changes in

Japan-Taiwan Relations: From LDP to DPJ?) Asashi Shimbun Weekly

AERA, March 5, 2001.

45. To understand the fact, we have to imagine how socialist

ideology affected liberal thinkers in Japan especially after World War II.

Marxism was not regarded as an antidemocratic concept in Japanese

society.

46. Sankei Shimbun, December 10, 2000.

47. Article 9 of the Constitution of Japan, renounces war. However,

the Japanese government’s official interpretation is that Japan can

have the minimum necessary level of capability for self-defense. Article

9 states that,

Aspiring sincerely to an international peace based on justice

and order, the Japanese people forever renounce war as a

sovereign right of the nation and the threat or use of force as

means of settling international disputes. In order to

accomplish the aim of the preceding paragraph, land, sea,

and air forces, as well as other war potential, will never be

maintained. The right of belligerency of the state will not be

recognized.

48.Democratic Party of Japan web-site: http://www.dpj.or.jp.

188
Part IV.

FLASH POINTS IN EAST

AND SOUTH ASIA

189
CHAPTER 9

THE U.S. SECURITY COMMITMENT TO

TAIWAN SHOULD REMAIN AMBIGUOUS

Brett V. Benson

Emerson M. S. Niou

INTRODUCTION

One of the most puzzling aspects of U.S. foreign policy is

the notion that peace and stability in the Taiwan Strait can

somehow be brokered by deliberately increasing the level of

uncertainty in a stressful crisis situation. At first glance,

such a policy strikes one as being, at best, unlikely to

succeed and, at worse, dangerously risky and irresponsible.

Yet, this is precisely the nature of the policy that dictates

the content of U.S. commitments in the dispute over the

official status of Taiwan. The policy at issue—the policy

often referred to as “strategic ambiguity”—has for decades

sought to balance competing U.S. interests in both China

and Taiwan, and, at the same time, maintain credibility,

peace, and stability in that region.

In recent years, especially in the years since the 1996

missile crisis, there has been a great deal of discussion

regarding the ability of the U.S. strategic ambiguity policy

to manage effectively the increasing tensions between the

People’s Republic of China (PRC) and the Republic of China

(ROC)/Taiwan. Both sides of the debate generally agree that

the constantly changing dynamics in the Taiwan Strait

threaten an inevitable collision between the PRC and the

ROC. Opponents of strategic ambiguity contend that the

new strategic environment calls for a clearer U.S. policy

directive. They say that this will at least prevent a

191
confrontation caused by Chinese or Taiwanese

misinterpretation of U.S. intent. Ideally, it will provide a

clear solution for the problems. Defenders of strategic

ambiguity argue that clarification will increase rather than

diminish the likelihood of war.

This chapter evaluates the notion that strategic

ambiguity is no longer a useful way to deal with the

increasingly complex nature of the cross-strait dispute.

After a brief introduction to the origin and development of

the U.S. policy of strategic ambiguity, we will then

summarize the positions of those who oppose strategic

ambiguity and consider what the impact would be were

their policy recommendations to be implemented. Finally,

we will provide some general comments about the efficacy of

strategic ambiguity as a dual deterrence policy.

I. ORIGINS AND DEVELOPMENT OF “STRATEGIC

AMBIGUITY”

Some regard strategic ambiguity as a Clinton

administration creation. Others view strategic ambiguity

as a 20-year-old policy guideline that emerged from an

institutional matrix defined by a number of acts and

communiqués. These are the 1972 Shanghai Communiqué,

the 1978 Joint Communiqué on the Establishment of

Diplomatic Relations Between the United States of America

and the People’s Republic of China, the 1979 Taiwan

Relations Act (TRA), and the 1982 United States-China

Joint Communiqué on United States Arms Sales to Taiwan.

While some may argue that the Clinton administration

approach to the Taiwan Strait issue was marked by

strategic ambiguity, the policy of strategic ambiguity itself

“is certainly not,” in the words of Georgetown University

historian Nancy Bernkopf, “a Clinton policy, and it is not a

Democratic policy.” According to Bernkopf, “[The concept of]

strategic ambiguity goes back to the Eisenhower

administration. It began with Eisenhower and [Secretary of

State John Foster] Dulles not wanting the Chinese to know

192
what we were going to do in the Taiwan Strait.”1 Dubbed by

Secretary of State Dulles, “deterrence by uncertainty,”2

Eisenhower’s dual deterrence strategy is aptly described in

the President’s memoirs. In his book, The White House

Years, Eisenhower recollects how his administration

managed the 1954 Quemoy crisis. He wrote: “The

administration rejected all... suggestions, threading its

way, with watchfulness and determination, through narrow

and dangerous waters between appeasement and global

war.”3 What is remarkable about Eisenhower’s use of

ambiguity in the 1954 Quemoy crisis is that even now “no

one can be sure whether or not the United States would

have responded militarily to an invasion of the offshore

islands, and whether or not the United States would have

used nuclear weapons.”4

II. OPPOSING VIEWPOINTS

Opponents of strategic ambiguity claim that the United

States should clarify its policy on Taiwan. They fall mainly

into two camps. On the one hand, there are those who focus

on preventing Taiwan from provoking the PRC. On the

other hand, there are those who seek to deter the PRC from

further threatening Taiwan.

Advocates of the first policy position seek to replace

strategic ambiguity with a clear policy designed to deter

Taiwan from making provocative moves against China.

They want the United States to make a commitment to

oppose any Taiwanese move toward independence. They

propose not only that the United States take an

unprecedented stance on Taiwan’s future, but also that the

United States should spell out under what circumstances it

would use force in defense of Taiwan. Proponents of such a

proposal rightly see Taiwan’s political liberalization as a

growing threat to the peace and stability in the Taiwan

Strait, and thus they want to maintain stability by

deterring the ROC from provoking the PRC.

193
However, since the unique security situation in the

Taiwan Strait is not simply a matter of one-sided extended

deterrence, this policy approach would tilt the scales in the

direction of Beijing. The PRC already, even in the face of

possible U.S. interference, views the use of military force as

an increasingly cost-effective way to force the Taiwan issue

in a direction favorable to itself. Given a low or nonexistent

U.S. commitment to defend Taiwan, the PRC would have

little reason to avoid escalating tensions with Taiwan.

Hence, although advocates of this policy approach hope that

it would bring about peace and stability, the reverse would

be true. If enacted, the proposed policy would more than

likely lead to the very military crisis that it intends to avoid.

Advocates of the second policy position seek to replace

strategic ambiguity with a clearer policy designed to deter

China from initiating hostilities against Taiwan. Their

policy would have the effect of giving the advantage to the

ROC. Proponents of this position perceive the PRC as the

source of contention in the cross-strait dispute, and thus

they propose to offer a high and clearly defined defense

commitment to Taiwan.

This approach would give Taiwan considerable leverage

in the cross-strait dispute. By giving Taiwan a high-level of

commitment and stipulating the conditions under which

the United States would defend Taiwan, we would only

embolden Taiwan to direct its actions toward independence.

Such an action would likely elicit a strong and possibly

violent reaction from the PRC. Thus this policy alternative,

for all its good intentions, would likely bring about the very

dangers it seeks to avoid.

III. STRATEGIC AMBIGUITY: EFFECTIVE DUAL

DETERRENCE

The history of the cross-strait conflict teaches the United

States that Taiwan and China will inevitably clash in a way

that will upset the stability of the delicate security balance

194
unless there exists a dual deterrence force, a power strong

enough to counter the threat that each poses to the other.

If dual deterrence is to work, it must be credible. Both

sides must believe that there will be unacceptable

consequences if they disrupt the balance of power in pursuit

of their policy goals. To deter Taiwan from provoking China,

the United States should avoid giving Taiwan the

impression that it is likely to come to the defense of Taiwan

in the event that China attacks it. At the same time, to deter

China from attacking Taiwan, the United States should

convince China that its commitment to defend Taiwan is

credible.

If there is no ambiguity about the level of U.S.

commitment, either China or Taiwan, after assessing the

credibility of U.S. commitment might find it in its interest to

provoke the other side. That is, if the United States specifies

a level of commitment that is sufficiently high to deter the

PRC, then Taiwan will have an incentive, under a firm U.S.

defense commitment, to move toward independence and

thus provoke the PRC. If, on the other hand, the United

States specifies a low level of commitment to defend

Taiwan, then Taiwan will be deterred from deviating from

the status quo, but the PRC will likely find it increasingly

cost-beneficial to take action against Taiwan. Hence, to

achieve both of its deterrence goals simultaneously, the

United States cannot be explicit about the conditions under

which it will defend Taiwan.

CONCLUSION

In short, clarifying when and how the United States

would defend Taiwan would have damaging effects. The

United States would lose much of its freedom of action and

likely precipitate the very conflict all hope to avoid. A

one-sided deterrence would increase the likelihood that one

or more of the players would consider it cost-effective to

escalate the conflict and resort to the use of force.

195
Over-committing to either side would be a mistake. We

should continue to follow the strategy originated by

Eisenhower and later solidified in the institutional policy

framework of existing U.S. laws and agreements. Though

undoubtedly well intentioned, the proposed solutions to the

complex cross-strait problem are likely to court disaster.

Eisenhower once said, “The hard way is to have the courage

to be patient.” Difficult as it may be, we should pursue the

policy of strategic ambiguity.

ENDNOTES - CHAPTER 9

1. Jim Mann, “House GOP Wants U.S. Pro-Taiwan,” Los Angeles

Times, March 6, 1996, p. A1.

2. Gordon H. Chang and Di He, “The Absence of War in the

U.S.-China Confrontation over Quemoy and Matsu in 1954-1955:

Contingency, Luck, and Deterrence?” The American Historical Review,

Vol. 98, No. 5, 1993, p. 1511.

3. Dwight D. Eisenhower, The White House Years: Mandate for

Change, 1953-1956, Doubleday & Company, 1963, p. 483.

4. Robert A. Divine, Eisenhower and the Cold War, New York and

Oxford: Oxford University Press, 1981, p. 65.

196
CHAPTER 10

NORTH KOREA ON THE BRINK:

BREAKDOWN OR BREAKTHROUGH?

Andrew Scobell

INTRODUCTION

The rapid turn of events on the Korean Peninsula during

the period from May to October 2000 has been aptly labeled

“breathtaking.”1 The rapprochement between North and

South Korea, most notably the June 2000 summit between

Kim Dae Jung and Kim Jong Il, and the thaw in

Washington-Pyongyang relations during the Clinton

administration certainly merit this adjective. Moreover, the

flurry of North Korean diplomatic activity associated with

these events is nothing short of “remarkable.”2 While it is

premature to proclaim the arrival of lasting peace on the

peninsula, taken together these events do suggest that

there may be a fundamental policy reorientation underway

in North Korea from confrontation to conciliation and from

autarky to opening. Still it is too early to say with absolute

certainty if this is truly a strategic shift or is merely a

change in tactics. Certainly there is no indication yet that

North Korea is on the verge of trimming its million-man

armed forces or standing down from the Demilitarized

Zone.3

Whatever the future of “Flashpoint Korea,” it will

largely be determined by the policies and actions of the

Democratic People’s Republic of Korea (DPRK), more

commonly known as North Korea. The DPRK is the

“pivotal” or “powder keg” state in Northeast Asia.4 That is, it

is the most unstable state in the neighborhood—the one

197
most likely to shake the entire subregion should it explode

or implode. Because North Korea is the root source of the

persistent tensions on the peninsula it behooves us to

understand what makes Pyongyang tick.

Critical dimensions in understanding what makes

North Korea tick are the fundamental nature of the

Pyongyang regime and its national security calculus. What

kind of regime is it? What are the regime’s goals? How

significant is Pyongyang’s recent heightened level of

diplomatic activity, and its overtures toward Seoul and

Washington? Is reform a real option for North Korea?

Finally, what are the implications of the answers to these

questions for the United States?

WORKING ASSUMPTIONS

There are two working assumptions that under gird this

chapter. The first assumption is that one can draw up a

finite list of future possibilities for the DPRK. Marcus

Noland, one of the most astute observers of North Korea,

suggests there are three possible scenarios: collapse,

successful reform, or muddling through.5 In my view, the

alternatives are starker because what I call the North

Korean party-military-state (PMS) cannot avert breakdown

unless it institutes fundamental reforms. Therefore it all

boils down to two alternatives: either there will be a

breakthrough (i.e., substantive reform), or Pyongyang will

sooner or later face a breakdown (i.e., regime collapse). Of

course the sub-variants of the collapse scenario hold

significant and quite different implications for North Korea

and its neighbors. It is possible that both breakdown and

breakthrough could happen: that is, North Korea could

choose the path of reform only to see the results of reform

unleash forces that undermine and ultimately lead to the

collapse of the regime. Indeed, the so-called “reformer’s

dilemma” is Pyongyang’s secret fear.6

A second fundamental assumption is that it is possible to

deduce the security calculus of the North Korean regime

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with a fair degree of confidence. Pyongyang remains

probably the most secretive and insular political system in

the world today and it is impossible to say with 100 percent

certainty how North Korea’s leaders really view the world

and what their intentions are. Nevertheless, there still

exists a considerable amount of credible open source

materials and individuals with significant contact with

North Korea officials upon which to draw. Moreover there

are a number of first rate efforts to provide a comprehensive

and coherent analysis of Pyongyang’s national security

calculus.7 Of course, these analyses do reach disparate

conclusions, but this is not surprisingly given the “gaps,

limitations, and uncertainties in the evidence.”8

I. A PARTY-MILITARY-STATE

What is the nature of the regime? North Korea is an

institutionalized communist party-military-state (PMS).

Communist regimes are usually called “party-states” but in

the case of the DPRK armed forces are so central and

intertwined with the party and state elites that I refer to the

North Korean regime as PMS. Other recent attempts to

characterize the regime have focused on the incestuous and

dynastic dimension of the regime, dubbing it the “Kimist

system” or “Kim Family Regime.”9 While the centrality of

Kim Il Sung and Kim Jong Il is undeniable, the regime is far

more than a family dictatorship. As Adrian Buzo observes:

“The smooth [father to son] transition was perhaps due as

much to the tight web of Party organization that covers all

aspects of life in the North as to the younger Kim’s political

acumen.”10

The Korean People’s Army (KPA) holds a privileged and

central position in the regime. Kim Jong Il clearly

recognizes the critical importance of the military

constituency and the KPA appears to have supplanted the

Korean Workers’ Party (KWP) as the most powerful

institution in North Korea.11 In August 2000, Kim told a

delegation of South Korean media executives “My power

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comes from... military power.”12 In short, North Korea is a

“garrison state.” The term garrison state was formulated by

Harold Lasswell to describe a state in which the military is

the dominant class, and the entire orientation of the state is

toward preparation for waging war.13 According to Adrian

Buzo: “Kim Il Sung held . . . the belief that the purpose of the

state, no less the purpose of the guerilla detachment, was to

wage war effectively.”14 North Korea has “the most highly

militarized society in the world,”15 and the country has been

on a “quasi-war footing” for 3 decades.16 There are a number

of ways to quantify the extent of this militarization, but by a

variety of measures North Korea appears to be extremely

militarized. At least a third of the central government

expenditures and a quarter of the Gross National Product

are allotted to defense.17 North Korea possesses the fifth

largest armed forces in the world with millions more in the

reserves and additional millions in the worker and peasant

militia.18 In terms of the ratio of soldiers per thousand

population, as of 1995 North Korea ranked at the top of the

list with 44.3. This contrasted starkly with 2.4 soldiers per

thousand population for China and 7.6 for Vietnam in the

same year. Such a peacetime standing army in the

contemporary world is without precedent. To underscore

the extent of militarization in the DPRK, even on the eve of

the forcible unification of the Vietnams (1975) there were

only 25.8 Vietnam People’s Army soldiers for every

thousand North Vietnamese citizens—about half the ratio

for latter day North Korea.19 The KPA also runs a vast

chunk of the economy. The military’s sector, dubbed “the

second economy” because it is controlled by the so-called

Second Economic Commission, controls as much as 40 or 50

percent of North Korea’s industrial output.20

In addition to having substantial resources at its

disposal, the KPA is intertwined with the KWP and

functions as an elite within an elite.21 The prominence of the

military is indicated by that fact that for years following his

father’s death, Kim Jong Il’s sole position of authority was

listed as Chairman of the National Defense Commission. Of

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course, he only assumed top civilian positions upon the

conclusion of the 3-year period of mourning following his

father’s death. Kim’s choice of a special envoy to dispatch to

the White House in October 2000 was Vice Marshal Jo

Myong Rok, the first vice chair of the National Defense

Commission and director of the General Political Bureau of

the KPA. The two delegations Kim led to China in mid-2000

and early 2001 also had strong military representation. Of

the top five members of the May 2000 delegation, two were

KPA leaders: General Jo Myong Rok and Chief of the KPA’s

General Staff Department Kim Yong Chun. Three of the ten

senior officials in the January 2001 delegation were

military leaders: General Kim, Chief of the KPA General

Staff and two deputy directors of the KPA’s General

Political Bureau.

II. TOTALITARIANISM AND

POST-TOTALITARIANISM

The term totalitarianism, popularized by Hannah

Arendt and codified by Carl Friedrich and Zbigniew

Brzezinski, does seem appropriate to describe the DPRK

under Kim Il Sung.22 However, it does not seem to fit quite

so well North Korea under Kim Jong Il.23 The degree of

absolute control required in a totalitarian regime is only

sustainable for a limited time and does not long outlive the

tenure of a Joseph Stalin or a Mao Zedong. Since the death

of Kim Il Sung, I contend North Korea has been moving

toward what Juan Linz has called “early

post-totalitarianism.” Key changes are the erosion of the

absolute power of the top leader, the loss of ideological

commitment—the ossification and ritualization of political

doctrine. In early post-totalitarianism, ideology as tool for

motivating and mobilizing the elite and the masses

noticeably weakens.24 While there has been a slight

loosening of the regime’s grip on society, the PMS is still

very much in control in North Korea. If this change is

underway, this offers the possibility of significant internal

transformation. While movement toward democracy is

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definitionally impossible under a totalitarian regime, with

an authoritarian regime there always remains the potential

for liberalization and even democratization.25 To chart the

shift in North Korea from totalitarianism to

post-totalitarianism, it is useful to go through the six

characteristics identified by Carl Friedrich and Zbigniew

Brzezinski.

1. Single leader and ruling party. Kim Il Sung

consolidated his power during the Korean War and 1950s.

He purged threats to his power such as the Yenan faction. It

was during the 1960s that Kim the Elder established

absolute control over the country and this status was

codified in the early 1970s. By this time, Kim Il Sung had

created a full blown personality cult.26 Then in 1994 North

Korea witnessed the first instance of dynastic succession in

the communist world when Kim Jong Il assumed the role of

paramount leader following the death of his father Kim Il

Sung in July of that year. While Kim the Younger seems to

have consolidated his leadership status in his own right by

2000, there seems to have been a weakening of the authority

of the paramount leader.27 Within the elite there appears to

be a greater awareness of the economic failures and

limitations of, if not the leader, then the regime.

Yet, the regime is more than just a one man dictatorship:

organizationally the Korean Worker’s Party and KPA

completely dominate the political system and brook no

opposition. The PMS remains in control although its grip is

weakening (see below).

2. Totalist ideology. Kim Il Sung was given the status of

Korean visionary and is credited as being the main architect

of Pyongyang’s “juche” ideology. This concept was first

articulated by Kim in the mid-1950s and soon became

intensely nationalistic and billed as a unique Korean

distillation of Marxism-Leninism.28 Kim preached Korean

self-reliance and, despite substantial Soviet and Chinese

assistance over the years, the juche myth remained largely

intact.

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Under Kim Jong Il this autarkic doctrine now flies in the

face of reality. There has been a massive infusion of foreign,

including Western, aid. It is clear that North Korean

citizens are aware of the origins of this aid.29 Foreign

companies are starting to invest in the North, and the

regime has made some small gestures toward reform, such

as allowing farmers to sell their produce in free markets.

Moreover, the ideological underpinnings of the regime

suffered a major blow when the chief disciple/guardian of

juche, Hwang Jong Yop, defected in 1997.

Another key tenet of the ideology was the commitment to

seize South Korea militarily. Pyongyang’s dedication to the

liberation of Seoul has also undergone a moderation of sorts.

Commitment to military unification is belied by the fact

that the leadership consented to a deal whereby both Koreas

were simultaneously admitted to the United Nations

(U.N.). Moreover, President Kim Dae Jung’s visit to

Pyongyang in June 2000 can only have added to these

doubts.

3. Centrally planned economy. Under Kim Il Sung the

DPRK was a firmly established command economy. Despite

the real systemic flaws inherent in centrally planned

economies, the structure worked well enough at least in the

first several decades of the DPRK existence. Growth rates

were very good, equal to or higher than those in South Korea

for the same period. Moreover, significantly, North Korea

holds the distinction of being the only Asian communist

country that did not suffer a famine during the early years of

its existence.30 In contrast, by the mid-1990s North Korea

was approaching economic collapse. One definition of what

constitutes economic collapse is the breakdown of the

national food production and distribution system—such a

disaster occurred in the DPRK. North Korea experienced

widespread famine and malnutrition, and it is estimated

that between two and three million people died as a result.31

The outcome of this collapse was tolerance by the regime of

private markets for the sale of food. This development,

along with the infusion of foreign aid, may have contributed

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to a slight improvement in the economic situation in the

North. Thus the command economy has loosened up.

4. Monopoly of mass communications.32 Under Kim Il

Sung there was absolute control over the flow of information

and little possibility of independent outside sources of

information. In the late 1990s, with the movement of

humanity across the border with China and the family

reunions held in North and South Korea in 2000, there are

increasing opportunities for DPRK citizens to obtain other

independent sources of information about the world. There

is likely to be some information about the famine

percolating within North Korea, but for ordinary DPRK

citizens official censorship still functions effectively.33

Nevertheless, as noted above, many ordinary Koreas are

well aware that food aid comes from overseas, including the

United States. The situation among the regime elite is

somewhat different. There has likely been an increased

level of access to overseas media. Kim Jong Il has a thirst for

foreign news and popular culture. This material must pass

through the hands of others since Kim does not speak or

read foreign languages. It is also probably viewed by still

others.

5. Control of the coercive apparatus.34 The vast coercive

apparatus continues to function under Kim Jong Il but with

somewhat less effectiveness. It is estimated that there are

at least 200,000 political prisoners in North Korea.35 If

security forces were not looking the other way or failing to

stay alert, how could tens of thousands of refugees have

crossed the border into China in the late 1990s? Bribery of

North Korean border guards allows significant back and

forth movement across the border.36 Moreover, there have

been defections by members of the regime itself, most

notably the KWP chief theoretician already mentioned,

Hwang Jong Yop.

6. Pervasive condition of terror. Under Kim Il Sung there

seems to have been a pervasive condition of terror among

both elites and ordinary inhabitants. The purge of elites

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began in the mid-1950s and harsh repression over the

masses soon followed.37 By the late 1990s, however, this

seems to have weakened along with the loosening of the iron

grip of the coercive apparatus. The most graphic illustration

of this is the scale of the refugee exodus across the border

into China in recent years. At least tens of thousands (and

perhaps as many as 300,000) primarily economic refugees

have been able to cross into China.38 As noted in the

previous section, a small but significant number go back

and forth. Furthermore, the defections of regime elites in

recent years, which would have been unimaginable in

earlier times, suggest that the condition of terror is

weakening. As yet, however, no opposition groups have

developed, nor is there any organized dissent and a climate

of intimidation still seems to pervade major cities like

Pyongyang.39

In short, I contend that today the DPRK is an eroding

totalitarian or nascent post-totalitarian regime. However,

the weakening of the PMS does not necessarily herald the

imminent breakdown of the regime. Economic collapse (i.e.,

a food crisis) has not triggered the collapse of the regime in

other communist countries.40 The Chinese communist

regime, for example, weathered the disaster of the Great

Leap Forward in the late 1950s and early 1960s, despite the

fact that it cost an estimated 30 million deaths.

III. PYONGYANG’S NATIONAL SECURITY

CALCULUS

What is the national security calculus of the regime? The

paramount goal of the regime is fundamentally survival.

This entails retaining power and suppressing any domestic

or foreign challenges to its authority or existence. This

means the continued maintenance of a sizeable coercive

apparatus of military, paramilitary, and police formations.

If we are to judge by the behavior of other communist

party-states, North Korea’s leaders see security threats

everywhere. They are almost certainly paranoid. In short,

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they probably possess a “siege mentality.”41 Still, North

Korea’s leaders are not crazy or mad; in fact they are very

rational and calculating.42 The strongest evidence of this is

that they have not attacked southward in force for almost 50

years.

At home the regime seeks to maintain full control

through a combination of intimidation, appeals to

patriotism, and the perpetuation of a Kim family cult.

Externally, Pyongyang seeks, at a minimum, to protect

itself from perceived threats. The most obvious and

proximate threats to the existence of the regime come from

the armed forces of the Republic of Korea and from the

United States which are positioned south of the

Demilitarized Zone.43 The regime also faces the threat of the

vast nuclear arsenal possessed by the United States. Here, I

am not justifying North Korea’s massive military machine,

its development of a missile program, or other actions. I am

merely trying to explain how the regime views its security

environment. With these threats in mind North Korea’s

vast military and its desire to possess capabilities

comparable to those of its potential adversaries become

more comprehensible. The quote from Kim Jong Il noted

above bears repeating: “My power comes from... military

power.” Pyongyang retains vivid memories of U.S.

saturation bombing during the Korean War.44 North Korea

endured 3 years of “terrible destruction” during which,

according to U.S. Air Force estimates, 17,000 tons of bombs

“at least half obliterated” 18 of 22 major cities, including 75

percent of the city of Pyongyang.45

Indeed, the DPRK’s identity is intimately bound up with

its military prowess and linked to possession of weapons of

mass destruction (WMD).46 The Korean communist

movement developed in the 1930s and 1940s in an

environment in which military prowess was the primary

characteristic of state power and preparation to wage war

seemed the supreme mission of the state. The long struggle

against Japanese occupation of the peninsula, World War

II, and the Chinese Civil War all reinforced this view.

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Moreover, the possession of WMD appears to be seen as

central to the DPRK’s identity. Koreans, along with

Chinese, experienced the use of biological agents by

Japanese military units. At least 10,000 Koreans were

killed, moreover, and many others maimed, by the two

atomic bombs dropped on Japan in 1945 because hundreds

of thousands of Koreans were engaged in forced labor in

Japanese factories, mines, farms, and construction sites at

the time.47 And significantly, many in North Korea continue

to believe sincerely that they were the victims of American

biological warfare during the Korean War even though this

does not appear to be the case.48

Of course, North Korea does not maintain a massive

military complex merely for defensive purposes. Pyongyang

also harbors dreams of unifying the Korean Peninsula

either by military or nonmilitary means. Formally

unification is still a central objective of the regime. Does the

North Korean leadership actually continue to believe that

unification with Seoul under the auspices of Pyongyang is

possible or even likely? This is difficult to say, but I suspect

it still does.49 But even if it did not, Pyongyang, just like the

communist regime in Beijing, would find it very difficult, if

not impossible, to drop publicly the unification plank. To do

so would undermine the legitimacy of the regime. Similarly,

formal renunciation of the use of force to achieve unification

would be extremely awkward.

Certainly Pyongyang does not hold all the cards, but it

does possess the instincts of a seasoned high stakes poker

player: it plays the hand it is dealt with consummate skill to

maximum advantage. The regime is calculating and logical,

creating and maintaining a state of crisis in order to

strengthen its hand. According to Victor Cha: “The North’s

bargaining strategy is dangerous, destabilizing, and

rational.” 5 0 Indeed another scholar argues that

Pyongyang’s security policy is a deliberate one of

“deterrence through danger.”51

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IV. BREAKTHROUGH IN PYONGYANG?

What are the chances for reform in North Korea? Kim

Jong Il does seem serious about reform. Indeed, nothing

short of a fundamental reorientation appears to have taken

place in Pyongyang.52 Senior leaders seem to realize that

reform is essential (although the word “reform” itself is

taboo and “change” is the preferred buzz word) if the regime

is to break its downward economic spiral. Moreover, top

leaders appear to recognize that, if such a spiral goes

unchecked, the regime is headed for eventual collapse.

Many analysts continue to insist that a decision to reform is

impossible. They may be right. It is important, however, to

keep in mind Nicholas Eberstadt’s warning and remember

North Korea’s “continuing capacity to surprise.”53 Outside

observers should not close themselves off from the

possibility that Pyongyang is capable of pulling off yet

another surprise.

Why did Pyongyang wait until the dawn of a new century

to decide to move on reform? First, and perhaps most

significant, is the lesson drawn from the collapse of the

Soviet Union in 1991. According to Hak-joon Kim: “North

Korea has minutely evaluated the cause of the Soviet

Union’s ruin, and has concluded that the Soviet Union was

induced into excessive military spending by the USA which

resulted in domestic economic failure, which in turn led to

the inevitable collapse.”54 North Korea has clearly been

suffering an economic crisis which is attributable in large

measure to the “excessive military spending” noted in the

preceding quotation.

Second, a new top leader in Pyongyang is coming into his

own. Many analysts concluded—correctly in my view—that

significant reforms would have been impossible under Kim

Il Sung.55

Third, Kim the Younger had to permit a decent interval

to pass before he launched a reform initiative. Certainly this

sea change, if it has indeed arrived, has been slow in coming.

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Between Kim the Elder’s death in July 1994 and late 2000,

there was no evidence of Kim Jong Il’s support for reforms,56

and Kim the Younger appeared “unlikely to be an agent of

change.”57 But reform seems to have been on hold until Kim

Jong Il had firmly entrenched himself in power and the

economy was on the mend. As Nicholas Eberstadt observes,

reform in post-Mao China had to await a change in its

supreme leader and a “consolidation of power” by Deng

Xiaoping.58 A similar dynamic is at work in post-Kim Il

Sung North Korea, but Kim Jong Il seems to have required

much more time to become securely entrenched in power.

Initiatives such as Pyongyang’s hosting of South Korean

President Kim Dae Jung were not possible until Kim Jong Il

felt more confident and comfortable as North Korea’s top

leader.59

Moreover, Kim Jong Il had to avoid giving the

impression that he was adopting a program of reform out of

sheer desperation. Kim needed to wait until the food

emergency had ameliorated. As some analysts note,

instituting reforms implies there are flaws in the system

that need to be fixed—a heretical idea in “a country with

infallible leadership.”60 But by waiting until the economic

situation had begun to improve, Kim Jong Il could at least

maintain the fiction that instituting reforms was something

unrelated to the recent crisis and hence better perpetuate

the aura of an omnipotent leader.

There is some circumstantial evidence pointing to the

desire for reform. The increased frequency of travel to China

by senior officials and statements by Kim Il Sung during

these visits, for example, is indicative. Kim Yong Nam, the

head of North Korea’s parliament, visited China in June

1999, stopping off at Shanghai. He was the most senior

North Korean official to travel to China since Kim Il Sung’s

October 1991 tour.61 Then Kim Jong Il made two visits to

China within the space of eight months. Kim rarely travels

abroad and these visits constitute significant events. In fact,

Kim’s 2-day visit in May 2000 marked the North Korean

leader’s first visit to China in 17 years!62 These visits were

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certainly related to the rapprochement with Seoul and a

warming with the United States. They also indicated that

Kim was observing and learning from the Chinese reform

experience. In May 2000 Kim politely told his Chinese hosts

that the “policy of reform and opening up put forward by

Deng Xiaoping is correct, and the party and government of

the DRPK support this policy.” He further stated that

Pyongyang was “building a DPRK-style socialism” just as

Beijing was pursuing “socialism with Chinese

characteristics.”63

More dramatically, Kim made a 5-day trip in January

2001 and spent the bulk of his time (4 out of the 5 days) in

Shanghai. Kim’s enthusiasm about the results of China’s

reforms was unmistakable in the positive comments he

made during the course of his visit.64 Of particular interest

during both visits was information technology. On the May

2000 visit to Beijing, Kim and the delegation visited Legend

Computers in China’s equivalent of Silicon Valley and

returned with a dozen desktop computers. The January

2001 delegation also visited a Sino-Japanese

semi-conductor factory and a high technology park. The

group reportedly returned with three minibuses and a truck

full of computer printers, mobile phones and other

telecommunications equipment. This latter trip also

included visits to a General Motors joint venture, the

Shanghai stock exchange, and the recently developed

Pudong zone.65 The reason for including three top military

leaders in the delegation appears to have been to win these

figures over to the value of the Chinese model.

North Korea has formally requested membership in the

Asian Development Bank and expressed interest in getting

more involved with the World Bank and other economic

multilateral organizations. Pyongyang also seems to want

to learn: North Korean officials have enrolled in training

programs sponsored by the World Bank and the U.N.

Development Program.66

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V. BARRIERS TO REFORM

However, there appear to be substantial barriers to

reform. Even if Kim Jong Il is serious about instituting

reforms these barriers may prove insurmountable. Four

apparent barriers should be noted: (1) a conservative

military; (2) the absence of a broad pro-reform constituency;

(3) a lack of understanding about the kind of reform needed;

and (4) the slow pace to date of reforms.

KPA: Barrier or Backer?

Given the central importance of the military and the

extremely high level of militarization in North Korea, the

KPA would at first glance appear to be a powerful barrier to

economic reform. Perhaps a better way to view the KPA

leaders is to see them as conservative and skeptical. They

are not necessarily adamantly opposed to reform, but they

will probably require serious convincing; hence the need to

bring three top military leaders to China in January 2001.

While Kim Jong Il has almost certainly focused in on high

technology because of a strong personal interest, he

probably also sees this as a way “to lure the military in” with

the promise that this technology can be applied to defense.

It should be noted that Vice Marshal Jo Myong Rok on his

October 2000 trip to Washington made a stopover in Silicon

Valley. 67 The recent lackluster performance by the North

Korean navy in the June 1999 naval engagement with the

ROK Navy may further reinforce the belief that reforms are

essential if the KPA’s combat effectiveness is to be

improved.68

Indeed, the most logical way to proceed with reform is

with the military at center stage. The military is the best

disciplined, most well-organized, and action-oriented

institution within the PMS. It is also the institution with

the most extensive existing economic operations. Moreover,

using the military is a way to inoculate the central pillar of

the regime against anti-reform viruses. And the KPA has an

obvious and proximate example of the opportunities

211
available to the military in a reforming Leninist

party-state: China’s People’s Liberation Army.

Kim Jong Il: the Spearhead of Reform?

As of this writing, the commitment to undertake reform

appears to be limited to Kim Jong Il. The impetus for reform

might end if Kim were to die or be ousted. This would be

especially likely if the economy appeared to be recovering

and little reform had actually been implemented. Kim

turned 59 years old in March 2001. He appears to be in good

health, but if even a fraction of the rumors about his wild

living are true, he is probably suffering health problems

related to such things as heavy and prolonged alcohol abuse.

The fate of reform in North Korea very likely hinges on his

health and longevity.

Lack of Understanding about the Nature of

Reforms.

A core problem appears to be a fundamental lack of

understanding at the highest levels about the nature and

extent of the reform that is needed. This problem exists at

the very top: Kim Jong Il himself seems to have only a

superficial understanding of reform. While visiting

Shanghai, he reportedly remarked: “Let’s build

skyscrapers,” appearing to equate reform with high rises.69

By no means am I suggesting the Kim is an ignoramus or

unintelligent.70 But it is important not to forget Kim’s

interests, background, and level of exposure to the world

beyond North Korea’s borders.71

On the surface Kim Jong Il seems urbane and

sophisticated—certainly this is the image gleaned from his

performance during the summit with Kim Dae Jung in June

and his discussions with Madeleine Albright in October

2000.72 Kim was able to converse easily with Madeleine

Albright and even offered to exchange e-mail addresses

with the Secretary of State.73

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First of all, Kim is an acknowledged film buff. He enjoys

watching movies, making movies, and certainly knows a

thing or two about acting.74 He played his leading role in last

year’s production of “Kim Jong Il’s Coming Out Party” to a

tee. One analyst called his performance possibly the “best

public relations makeover of the century.”75 He went to

great lengths to kidnap a South Korean film director and

the man’s former wife (also an actress) in 1978 with the

objective of improving the North Korean film industry.76

Second, Kim’s education and preparation for ruling

North Korea has been very limited. It is debatable what he

learned as a student at Kim Il Sung University. Political

economy was reportedly his focus of study at university, but

if he learned anything about the dismal science, it was

almost certainly not an introduction to the principles of

market economics. Rumors of an extended study abroad

sojourn at an East German military academy appear to be

false, although he did make at least one visit to Eastern

Europe.77

Third, Kim has led an extremely sheltered life. While he

may have watched many foreign movies and is apparently a

CNN addict, he has only made a handful of visits

abroad—and one extended stay—all of this overseas

exposure has been to communist or post-communist states.

Even his 24-day mid-2001 visit to Russia actually entailed

quite restricted exposure to the country itself. The majority

of his time was spent ensconced in his luxury train car,

traveling from Pyongyang to Moscow and St. Petersburg

and back.78

It is very unlikely that he has a solid understanding of

how other governments function or how modern economies

work in the larger world. These limitations also affect even

senior economics bureaucrats.79 North Korean finance

officials asked a World Bank official to explain the

difference between a centrally planned economy and a free

market, and a member of the board of North Korea’s Central

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Bank asked what the difference was between micro- and

macro-economics.80

Minimal Progress on Foreign Trade and

Investment.

At least so far, progress on increasing foreign trade and

attracting foreign direct investment has been very

modest.81 Trade between the two Koreas was estimated to

have been U.S.$333 million in 1999—most of this was one

way from south to north in the form of humanitarian aid.82

Some 200 South Korean companies subcontract to North

Korean factories providing the raw materials and

equipment.83 And the number of Pyongyang approved

foreign trade corporations has actually shrunk between

1992 and 1998.84

It is important to note that, while foreign investment

regulations have been on the books since 1984, there has

been very little progress made in attracting foreign

investors.85 There seems to be little appreciation that, while

a legal framework is necessary to attract investors, it is far

from a sufficient condition. One gets the impression that

there is a pervasive feeling that foreign companies should be

driven by the desire to help North Korea rather than the

profit motive. Indeed, one encountered a similar

assumption in China during the early years of reform.

Certainly, the investment climate in North Korea is poor:

start-up costs are high, and infrastructure is almost

nonexistent.86 Many foreign companies, while interested in

investment opportunities, have found it slow going with

reliable information and key contacts difficult to come by.87

Moreover, the DPRK does not have the appeal of a domestic

market of the magnitude of China for foreign business

executives to salivate over. And there are no foreign

business success stories to speak of.

The most famous joint business venture is the October

1998 agreement reached by Hyundai to develop tourism for

scenic Mount Kumgang. The South Korean chaebol agreed

214
to pay Pyongyang more than U.S.$900 million for a 6-year

monopoly to shuttle South Korean tourists to the

unpopulated mountain. Hyundai seems unlikely to make

any money on the deal; in fact it is virtually assured of losing

money. According to a company executive, since 1998 more

than 300,000 tourists have visited and Hyundai has lost

approximately U.S.$40 million.88 In the final analysis, the

project does not further the reform effort: it provides

nothing except cold cash for the Pyongyang regime.89

Meanwhile, agreements with foreign companies for new

special investment zones so far exist only on paper.

Hyundai, for example, had hoped to establish a high-tech

industrial park in the North, and a South Korean-Italian

consortium has reached agreement to manufacture

automobiles for export to China.90 These plans appear to be

in doubt as of this writing.

VI. DIAGNOSIS AND PROGNOSIS FOR THE

REGIME

The North Korean economy is still in poor shape, but the

decline seems to have bottomed out. Politically, the regime

seems to be stable for now. While my diagnosis is that

Pyongyang is terminally ill, North Korea’s PMS,

nevertheless, can continue to function and survive for a

considerable period of time. But, when change does come to

North Korea, it could be sudden and very possibly

“convulsive and violent.”91 Breakdown is the most likely

outcome, either because of a failure to initiate substantive

reforms or as a result of incomplete or botched reform.

The following breakdown or breakthrough scenarios are

listed in order of probability from most to least likely.

Breakdown Scenarios.

1. Romanian-style COUP. In this scenario, there is little

reform and continued economic stagnation or deterioration,

which lead to a dramatic, violent palace coup and

replacement by a nominally noncommunist regime. This

215
could come before, after, or even during the passing of Kim

Jong Il. Probability: fair.

2. North Korean/Cuban LASH OUT. In this scenario,

there is little or no reform, and the regime strikes outside its

borders in frustration to ease a domestic crisis—either

Pyongyang-style with an act of terror, or Havana-style by an

act of a annoyance. The latter variant would, for example,

involve emptying labor camps and triggering an exodus of

unwanted people similar to the Mariel boatlift from Cuba in

1979, which brought some 125,000 Cubans to the United

States. The Pyongyang regime could still hold onto power

for years following this just as the Havana regime has.

Probability: moderate.

3. East German-type COLLAPSE. In this scenario,

there is little or no reform, and a sudden, bloodless collapse

of the PMS occurs. There is minimal violence and a

relatively smooth and swift absorption by South Korea.

Probability: moderate.

The greatest potential for rising tensions is a scenario in

which there is a sudden and rapid collapse of the North

Korean PMS along the lines of Romania or East Germany.

These scenarios could be extremely confusing and involve

battles between different armed factions and mass refugee

outflows. Even if the collapse were peaceful, there would be

considerable uncertainty about who controls the North’s

missiles and WMD stockpiles. An Albanian-type implosion

would unfold on a far more catastrophic scale on the Korean

Peninsula. The emergence of chaos and a massive human

catastrophe would likely trigger international pressures for

at least humanitarian intervention and possibly the seizure

of key defense installations.

Breakthrough Scenarios.

1. Russian-style MUDDLE DOWN. In this scenario,

there is an unsuccessful reform breakthrough: no real

systemic reform and a gradual erosion of PMS power and

216
capacity. The growing turmoil would be difficult for the

regime to manage but tolerable for North Korea’s neighbors.

The result would be a slow decline in the North Korean

military threat and the potential for a shift to a breakdown

scenario. Probability: moderate.

2. Chinese-style MUDDLE THROUGH. In this

scenario, there is a successful breakthrough. The systemic

reforms do create some upheaval, but this is manageable.

The PMS grows stronger militarily or at least no weaker.

Probability: low.

A muddle down scenario, along the lines of that

experienced by the Soviet Union, presents a difficult

challenge. Such a scenario could result in a greater North

Korean dependence on Beijing, to the point that North

Korea would once again become a quasi-tributary state of

China. A Chinese muddle through scenario would revive the

fortunes of the PMS but, if pursued for long, would result in

far reaching changes that would effectively undermine the

system. In either circumstance, Pyongyang would remain a

military power of some consequence but would likely

become far more moderate as the regime and people had an

increasing stake in continued economic reform and opening

to the world.

VII. IMPLICATIONS FOR THE UNITED STATES

While it is still too soon to pen an epitaph for the PMS

regime, it is not premature to anticipate the end-game.

The United States and South Korea should be prepared

for the unexpected. This is the lesson of the collapse of

communism in Eastern Europe and the Soviet Union. When

the holding pattern that exists on the Korean Peninsula at

this writing ends, there should be a gradual decline in

tensions.92 This means that the chances of a Major Theater

War (MTW) being fought in Korea ought to lessen over time.

Despite the declining probability of MTW, the coming

decades will present the United States with complex

217
challenges on the peninsula including “responding to

limited acts of belligerency” by Pyongyang.93

The processes of reconciliation and unification will

inevitably be complicated and confusing. Not only will it

likely be difficult to decipher the specific elements of a

breakdown or breakthrough, but it will be important to be

clear about the larger dynamics at work. In particular, it

should be recognized promptly that the death of the PMS

does not necessarily mean the end of North Korea as a

distinct political entity. Sometimes analysts conflate the

end of the regime with the end of North Korea or assume

that one would inevitably follow from the other.94 The

Romanian breakdown scenario outlined above would result

in the end of the regime but the survival of the state.

While events in North Korea will be the ones to trigger a

crisis on the Peninsula, external actors will also play key

roles in how the crisis plays out. China looms large here. The

views of China must be taken into account in any North

Korean scenario. Beijing would like to see the continued

survival of the Pyongyang regime but prefers to see the

emergence of a moderate, pro-reform North Korea that is

low maintenance and low cost to China.95 Beijing’s

immediate concerns in a breakdown scenario would be the

operation of foreign forces in North Korea and a mass

refugee exodus. Indeed, China would likely be strongly

opposed to such intervention. Chinese leaders would

probably be prepared to intervene with military force

although they would certainly prefer to avoid this if at all

possible.96

U.S. forces in Korea and their brothers-in-arms from the

Republic of Korea must remain vigilant and ever-ready to

repel a North Korean attack. However, if the momentum of

2000 is regained, the United States must not be seen to be

“on the wrong side of history.” That is, Washington should

avoid positioning itself so that the United States is

perceived by South Koreans as a barrier to reconciliation or

unification. In coordination with its ROK allies, the United

218
States should make concrete proposals for reconciliation

and for comprehensive and verifiable conventional arms

reductions on the peninsula. Then the onus would be on

North Korea to reject them out of hand or at least agree to

discuss them. Should these proposals be rejected or ignored,

the United States will have lost nothing and will have

achieved a public relations coup. Should Pyongyang

respond, real progress could potentially be made toward

reducing the half-century old standoff on the Korean

Peninsula.

In conclusion, North Korea is on the brink of significant

change—it could be a reformist breakthrough but more

likely it will be some type of regime breakdown. Washington

and Seoul must be prepared for either eventuality.

ENDNOTES - CHAPTER 10

1. Admiral Dennis C. Blair, “Enhancing Regional Security

Cooperation,” speech delivered to the Asia Society by Commander in

Chief, United States Pacific Command, New York City, October 19,

2000.

2. Kent Calder, “The New Face of Northeast Asia,” Foreign Affairs,

Vol. 80, No. 1, January/February 2001, p. 110. See also, for example,

Howard W. French, “Suddenly Reclusive North Korea Reaches Out to

the Rest of the World,” New York Times (Washington Edition), March

17, 2000.

3. See excerpts of the Republic of Korea Defense White Paper issued

in late 2000 in Kukpang Paekso (Seoul) December 1, 2000, translated in

Foreign Broadcast Information Service (FBIS), December 7, 2000. For a

summary of its analysis of North Korea, see Kim Kwang-tae, “North

Korea Maintains Large-Scale Forward Deployment,” Korea Times,

December 5, 2000.

4. See Andrew Scobell, U.S. Army and the Asia-Pacific, Carlisle

Barracks, PA: Strategic Studies Institute, April 2001.

5. Marcus Noland, Avoiding the Apocalypse: The Future of the Two

Koreas, Washington, DC: Institute for International Economics, 2000.

219
6. On the reformer’s dilemma, see Samuel P. Huntington, Political

Order in Changing Societies, New Haven, CT: Yale University Press,

1968, Chapter 6.

7. David Kang, “North Korea: Deterrence Through Danger,” in

Asian Security Practice: Material and Ideational Influences, Muthiah

Alagappa, ed., Stanford, CA: Stanford University Press, pp. 234-263;

Stephen Bradner, “North Korea’s Strategy,” and Joseph S. Bermudez,

Jr., and Sharon A. Richardson, “The North Korea View of the

Development and Production of Strategic Weapons Systems,” both in

Planning for a Peaceful Korea, Henry Sokoloski, ed., Carlisle Barracks,

PA: Strategic Studies Institute, 2001, pp. 23-112.

8. Nicholas Eberstadt, The End of North Korea, Washington, DC:

AEI Press, 1999, p. 28.

9. Adrian Buzo, Guerilla Dynasty: Politics and Leadership in North

Korea, Boulder, CO: Westview Press; Bradner, “North Korea’s

Strategy,” p. 23.

10. Buzo, Guerilla Dynasty, p. 231.

11. Selig Harrison, “Time to Leave Korea?” Foreign Affairs,

March/April 2001, Vol. 80, No. 2, p. 70.

12. Son Key-young, “Kim Jong-Il Vows to Keep Military Power,”

Korea Times, August 15, 2000.

13. Harold D. Lasswell, “Sino-Japanese Crisis: The Garrison State

vs. The Civilian State,” China Quarterly (Shanghai), Vol. 12, 1937, pp.

643-649; Harold D. Lasswell, “The Garrison State,” The American

Journal of Sociology, Vol. XLVI, No. 4, January 1941, pp. 455-468;

Harold D. Lasswell, “The Garrison State Hypothesis Today,” in

Changing Patterns in Military Politics, Samuel P. Huntington, ed., New

York: Columbia University Press, 1962, pp. 51-70. For an application of

the concept to North Korea, see Gregory F. T. Winn, “North Korea: A

Garrison State,” in The Armed Forces in Contemporary Asian Societies,

Edward A. Olsen and Stephen A. Jurika, Jr., eds., Boulder, CO:

Westview Press, 1986, pp. 104-120.

14. Buzo, Guerilla Dynasty, p. 241. See also Bradner, “North Korea’s

Strategy.”

15. Andrew Scobell, Going Out of Business: Divesting the

Commercial Interests of Asia’s Socialist Soldiers, No. 3 Papers in

Politics and Security, Honolulu, HI: East-West Center, January 2001, p.

220
16. See also Nicholas Eberstadt, Korea Approaches Unification,

Armonk, NY: M. E. Sharpe, 1995, p. 51.

16. Eberstadt, The End of North Korea, p. 48. For a comprehensive

study of the North Korean military, see Joseph S. Bermudez, Jr., The

Armed Forces of North Korea, New York: I. B. Taurus, 2001.

17. For statistics on defense expenditures as a percentage of central

government expenditures and of GNP, see Scobell, Going Out of

Business, Table 2, p. 14.

18. On the global ranking of the Korean People’s Army, see Scobell,

Going Out of Business, Table 1, p. 4.

19. On these ratios, see Scobell, Going Out of Business, Table 2, p.

14.

20. For a discussion of the second economy, see Marcus Noland,

“Prospects for the North Korean Economy,” in North Korea After Kim Il

Sung, Dae-Sook Suh and Chae-Jin Lee, eds., Boulder, CO: Lynne

Rienner, 1998, p. 34. On the proportion of the economic output of the

military sector, see ibid., p. 53, note 5; and Buzo, Guerilla Dynasty, p.

242. See also, Hideshi Takesada, “‘First’ Or ‘Second’?: The Political

Economy of the Korean People’s Army,” paper presented to the Annual

Meeting of the Association for Asian Studies, March 2000, San Diego,

California.

21. Harlan W. Jencks, “The Party, the Gun, and the Great Leader:

Civil-Military Relations in North Korea,” in Asian Communism in

Transition, Robert A. Scalapino and Dalchoong Kim, eds., Berkeley, CA:

Institute of Southeast Asian Studies, University of California Press,

1988, pp. 187-217. See also Yong-Chool Ha, “Party-Military Relations in

North Korea: A Comparative Perspective,” in ibid., pp. 218-237.

22. Carl J. Friedrich and Zbigniew K. Brzezinski, Totalitarian

Dictatorship and Autocracy, Cambridge, MA: Harvard University

Press, 1956.

23. But it is still often described as such. Eberstadt, The end of North

Korea, p. 3. However, there is widespread agreements that North Korea

under Kim Il Sung was totalitarian. For a vivid description see

Helen-Louise Hunter, Kim Il-song’s North Korea, Westport, CT:

Praeger, 1999.

24. Juan J. Linz and Alfred Stepan, Problems of Democratic

Consolidation: Southern Europe, South America, and Post-Communist

Europe, Baltimore, MD: Johns Hopkins University Press, 1996, pp.

221
42-51. The term is originally Juan Linz’s. See his Totalitarian and

Authoritarian Regimes, Boulder, CO: Lynne Rienner, 2000. This is a

reprint of the author’s 1975 essay in the Handbook of Political Science.

Interestingly, Linz believes that North Korea under Kim Il Sung is best

described as a Sultanist regime rather than as a totalitarian one. Linz

and Stepan, Problems of Democratic Consolidation, p. 51.

25. Jeane J. Kirkpatrick, Dictatorships and Double Standards:

Rationalism and Reason in Politics, New York: Simon and Schuster,

1983.

26. Seong-Chang Cheong, “Stalinism and Kimilsungism: A

Comparative Analysis of Ideology and Power,” Asian Perspective, Vol.

24, No. 1, 2000, pp. 147-148; Kongdan Oh and Ralph C. Hassig, North

Korea Through the Looking Glass, Washington, DC: Brookings

Institution, 2000, chap. 2.

27. Harrison, “Time to Leave Korea?” pp. 69-70.

28. Cheong, “Stalinism and Kimilsungism”; Oh and Hassig, North

Korea, pp. 100-102.

29. Author’s conversations with nongovernment organization

(NGO) workers, Spring and Summer, 2001.

30. Eberstadt, The End of North Korea, pp. 61-62.

31. Ibid, pp. 9, 46.

32. Oh and Hassig, North Korea, pp. 142-143.

33. Ibid., pp. 66, 63.

34. See also Oh and Hassig, North Korea, chap. 6.

35. Jack Rendler, “The Last Worst Place on Earth: Human Rights in

North Korea,” in Planning for a Peaceful Korea, Sokolski, ed., p. 115.

36. Panel presentations in Session 197 “Life in Crisis: North Korean

Refugees in China,” at Association for Asian Studies annual meeting,

March 25, 2001.

37. Cheong, “Stalinism and Kimilsungism,” pp. 152-154.

38. Chinese officials and analysts claim only tens of thousands of

refugees (interviews, February-March 2000). NGOs claim that there

may be as many as 300,000. Most estimates tend to be in the range of

222
100,000-200,000. For higher estimates, see Kevin Platt, “N.Korea Gets

China’s Cooperation on Refugee Returns,” Christian Science Monitor,

June 9, 2000; Agence France Presse in English (Hong Kong), “DPRK

Refugees Riotings at Chinese Internment Camp,” April, 20, 2000

carried by FBIS, April 20, 2000. See also Rendler, “The Last Worst Place

on Earth,” p. 119.

39. Doug Struck, “Much is not allowed in North Korean Capital,”

Washington Post, October 24, 2000.

40. Eberstadt, The End of North Korea, p. 63.

41. Anthony Lake, “Confront Backlash States,” Foreign Affairs, Vol.

73, No. 2, March/April 1994, p. 46. Lake was referring to so-called “rogue

states.” See also Winn, “North Korea,” p. 117.

42. Eberstadt, The End of North Korea, pp. 6-7; Kang, “North

Korea”; Oh and Hassig, North Korea, p. 192.

43. Pyongyang believes that the United States presents the primary

threat to the security of North Korea according to William Perry, cited in

Harrison, “Time to Leave Korea?” p. 64. Winn, “North Korea,” p. 116.

44. Selig S. Harrison, “The Missiles of North Korea,” World Policy

Journal, Vol. XVII, No. 3, Fall 2000, p. 14.

45. Conrad C. Crane, American Airpower Strategy in Korea,

1950-1953, Lawrence: University of Kansas, 2000, pp. 168-169.

46. The first part of this paragraph draws on Buzo, Guerilla

Dynasty, pp. 240-242; and Bradner, “North Korea’s Strategy.”

47. Bruce Cumings, Korea’s Place in the Sun: A Modern History,

New York: W. W. Norton, 1997, pp. 177, 183.

48. While there appears to have been fabrication of evidence of

biological attacks by the United States in North Korea, some North

Korean and Chinese officials seemed to believe sincerely that the United

States had used biological weapons. See, for example, Milton

Leitenberg, “The Korean War Biological Weapon Allegations:

Additional Information and Disclosures,” Asian Perspective, Vol. 24, No.

2, 2000, pp. 163-164. For a lopsided discussion of the evidence, see

Stephen Endicott and Edward Hagerman, The United States and

Biological Warfare: Secrets from the Early Cold War and Korea,

Bloomington: Indiana University Press, 1998. The authors reveal that

there is a sincere belief among Chinese and North Koreans that the

United States used biological weapons during the Korean War. It should

223
be noted that their evidence of actual U.S. usage is weak. There does

seem to be recognition decades later by some top officials that biological

weapons were probably not used. Significantly, however, this is not a

politically acceptable public position for researchers to take in China or

North Korea. In the final analysis, what is important here is that the

myth of U.S. use apparently continues to be widespread in North Korea.

49. Certainly, many analysts believe they still do. See, for example,

Richard Halloran, “The Three No’s of East Asia,” The Journal of East

Asian Affairs, Vol. XIV, No. 2, Fall/Winter 2000, pp. 202-203; and

Bradner, “North Korea’s Strategy.”

50. Victor D. Cha, “The Continuity Behind the Change in Korea,”

Orbis, Vol. 44, No. 4, Fall 2000, p. 589.

51. Kang, “North Korea.”

52. See, for example, the analysis in Nayan Chanda, “Kim Flirts

with Chinese Reform,” Far Eastern Economic Review, February 8, 2001,

pp. 26-27; interview with former Department of State official, Spring

2001.

53. Eberstadt, The End of North Korea, p. 24.

54. Hak-joon Kim quoted in Kang, “North Korea,” p. 246.

55. Buzo, Guerilla Dynasty, p. 245.

56. Eberstadt, The End of North Korea, pp. 39, 12-4; Nayan Chanda,

“Marching to Kim’s Tune,” Far Eastern Economic Review, November 2,

2000, p. 18.

57. Buzo, Guerilla Dynasty, p. 246.

58. Eberstadt, The End of North Korea, p. 81. Of course, Eberstadt

cites the Chinese case to highlight the contrasts with North Korea and

hence lack of promise of reform in the latter.

59. Bradner, “North Korea’s Strategy,” p. 66.

60. Bradner, “North Korea’s Strategy,” pp. 28-29.

61. Reuters dispatch, “NK’s Kim Visits China Ahead of Summit,”

May 31, 2000, www.nytimes.com/reuters/international/

international-china-k.html.

224
62. “Kim Jong Il Visits China, Meets Jiang,” Xinhua Hong Kong

Service in Chinese June 1, 2000 in FBIS, June 1, 2000.

63. “Kim Jong Il Visits China, Meets Jiang.”

64. Kim Min-pae, “Kim Chong-il’s Remarks During His Visit to

China,” Choson Ilbo (Seoul) internet version in Korean January 21,

2001, in FBIS, January 21, 2001.

65. See, for example, Yi Chong-hwan, “What is in Kim Chong-il’s

Pack of Gifts... Yardstick for Conjecturing Direction of NK’s Reforms,”

Tong-a Ilbo (Seoul) in Korea January 25, 2001, in FBIS, January 25,

2001.

66. See, for example, Harrison, “Time to Leave Korea?” p. 69.

67. Nayan Chanda, “”Kim Flirts With Chinese Reform.” See also

Erik Eckholm, “N. Korea Placed Focus on Business in China Visit,” New

York Times, January 21, 2001.

68. “Diagnoses by ROK Experts on DPRK’s Prospects for Reform,”

Taehan Maeil (Seoul) internet version in Korean, January 27, 2001,

translated in FBIS, January 26, 2001.

69. Ruriko Kubota, “Kim Jong Il Aims to Build Shanghai-like High

Tech City,’ Sankei Shimbun, February 2, 2001, cited in Northeast Asia

Peace and Security Network, Daily Report, February 2, 2001.

70. Doug Struck and Steven Mufson, “North Korea’s Kim Sheds

‘Madman Image’,” Washington Post, October 26, 2000.

71. For biosketches of Kim Jong Il, see Dae-Sook Suh, “Kim Jong Il

and New Leadership in North Korea,” in Suh and Lee, eds., North Korea

After Kim Il Sung, pp. 13-31; Oh and Hassig, North Korea, pp. 85-95.

72. Michael Baker, “Profile/Kim Jong Il,” Christian Science Monitor,

June 13, 2000; Jane Perlez, “Visit Revises Image of North Korea,” New

York Times, October 26, 2000.

73. Jane Perlez, “Progress in N. Korea: Kim Says He’ll Cut Missile

Plans in Exchange for Help,” The Gazette (Montreal), October 25, 2000,

accessed on Lexis-Nexis on August 23, 2001.

74. Suh, “Kim Jong Il and New Leadership in North Korea,” pp.

21-22.

225
75. Nicholas Eberstadt, “What’s North Korea Up To?” Wall Street

Journal, June 19, 2000.

76. Don Oberdorfer, The Two Koreas: A Contemporary History,

Reading: MA: Addison–Wesley, 1997, pp. 348-349.

77. Suh, “Kim Jong Il and New Leadership in North Korea,” p. 17.

78. See, for example, Kevin Whitelaw, “Emerging from His Hermit

Kingdom,” U.S. News and World Report, August 13, 2001, p. 28; Anton

Uskov, “Summary of Kim Jong Il’s 24-day Visit to Russia,” ITAR-TASS

News Agency (Moscow) August 18, 2001, accessed on lexis-nexis,

August, 21, 2001.

79. Bradner, “North Korea’s Strategy,” pp. 29-30. For a dissenting

view, see Kim Yoon Kyu, “North Korea: Open for Business,” Far Eastern

Economic Review, October 5, 2000, pp. 22-23.

80. Eberstadt, The End of North Korea, pp. 11, 148, note 11.

81. For an overview of the current state of foreign investment and

trade reforms, see Noland, Avoiding the Apocalypse, pp. 1333-1340.

82. Kim Jae Hoon and Peter Saidel, “Pandora’s Box,” Far Eastern

Economic Review, August 10, 2000, p. 74.

83. Harrison, “Time to Leave Korea?” p. 71.

84. While there were 128 such corporations in 1992, by 1998 these

numbered “around 100.” See Eberstadt,The End of North Korea, p. 128.

85. Ibid., pp. 96-97.

86. Ibid., pp 82-83.

87. Samuel Len, “Western Business Tempers Enthusiasm for North

Korea,” New York Times, July 6, 2000.

88. Kim Yoon Kyu, “North Korea,” p. 22.

89. Eberstadt, The End of North Korea, p. 15.

90. Kim Yoon Kyu, “North Korea,” p. 22; Harrison, “Time to Leave

North Korea?” p. 72.

91. Quote is from Buzo, Guerilla Dynasty, p. 247; See also Bradner,

“North Korea’s Strategy,” p. 72.

226
92. Scobell, U.S. Army and the Asia-Pacific, pp. 3-4.

93. Cha, “The Continuity Behind the Change in Korea,” pp. 588-589.

94. The same point is make by Samuel S. Kim, “The Future of the

Post-Kim Il Sung System in North Korea,” in The Two Koreas and the

United States: Issues of Peace, Security, and Economic Cooperation,

Wonmo Dong, ed., Armonk, NY: M. E. Sharpe, 2001, p. 49.

95. For a concise discussion of Beijing’s calculus regarding the

future of North Korea, see Noland, Avoiding the Apocalypse, pp.

372-374.

96. Interpreting Beijing policy toward the Korean Peninsula and

divining Chinese preferences is a complicated business. For a

sophisticated and insightful analysis of Beijing’s Korea policy, see

Samuel S. Kim, “The Making of China’s Korea Policy in the Era of

Reform,” in The Making of Chinese Foreign and Security Policy in the

Era of Reform, David M. Lampton, ed., Stanford, CA: Stanford

University Press, 2001, pp. 371-408.

227
CHAPTER 11

THE RISE OF CHINA: IMPLICATIONS FOR

SECURITY FLASHPOINTS AND RESOURCE

POLITICS IN THE SOUTH CHINA SEA

David Rosenberg

INTRODUCTION

On Sunday, April 1, 2001, a U.S. surveillance aircraft

collided with a Chinese fighter jet and made an emergency

landing on China’s Hainan Island in the South China Sea.

The incident has raised a number of issues concerning

relations between the United States and China. What are

the security implications of the rise of China for the

international community, for its neighbors, and for the

United States in particular? This analysis examines one

potential trouble spot, the South China Sea, where small

conflicts could escalate into larger conflicts, with disastrous

implications for the world at large.

There have been many recent conflicts among nations

around the South China Sea, ranging from hundreds of

small-scale incidents involving fishing boats to a few major

violent clashes that resulted in significant death and

destruction. Five major issues have generated these

conflicts:

1. Conflicting territorial claims to the numerous islands

and reefs in the region, in particular, the Spratly Islands

and Paracel Islands.

2. Directly related to these are conflicting claims to the

oil and natural gas reserves which may lie beneath the

waters around these islands.

229
3. Maintenance of freedom of navigation in the face of

rising shipping traffic through the straits and sea lanes of

the South China Sea.

4. Piracy and sea robbery, which have increased rapidly

in the 1990’s, faster than the rise in shipping traffic.

5. Environmental pollution and resource depletion

issues. These include fishing disputes, and conflicts over

transboundary air pollution such as smoke haze from

Indonesian forest fires and acid rain from coastal Chinese

industries. Conflicts over coral reef damage and oil spills are

additional concerns.

What are the prospects that a dispute involving one of

these issues might become a major conflict involving China?

How contentious or cooperative has the People’s Republic of

China (PRC) been in resolving the numerous conflicts in the

region? This analysis examines China’s policy on the five

issues mentioned above with a view to assessing how

cooperative or confrontational it has been in resolving

conflicts in the South China Sea.

Background.

The South China Sea is defined by the International

Hydrographic Bureau as the semi-enclosed body of water

stretching in a Southwest to Northeast direction, whose

southern border is 3 degrees South latitude between South

Sumatra and Kalimantan (Karimata Straits), and whose

northern border is the Strait of Taiwan from the northern

tip of Taiwan to the Fukien coast of China.

The area includes more than 200 small islands, rocks,

and reefs, with the majority located in the Paracel and

Spratly Island chains. Many of these islands are partially

submerged rocks and reefs unsuitable for habitation.1

Geology and climate have combined to produce a

remarkable amount of biological diversity and immense

natural resources in the South China Sea. Over 30 percent

230
of the world’s coral reefs border the South China Sea,

especially around the archipelagos of Indonesia and the

Philippines. These coral reefs provide a habitat for the

highest biological diversity in the world.2 They provide the

foundation of an aquatic food chain. About half of the coastal

population’s protein intake now comes from the sea.3

The littoral countries of the South China Sea have

similar coastal ecosystems and access to common resources;

for example, coastal cultivation of oysters and shrimp, and

deep-sea fishing for tuna and other migratory species in the

South China Sea. A large portion of the coastal workforce is

dependent on the marine environment. This includes

employment in fishing, marine transportation, offshore

exploration and mining of mineral and non-mineral

resources, and recreation and tourism.

The South China Sea may also be an important source of

oil and natural gas. However, the cost of drilling in

deep-water areas of the South China Sea is high.

Preliminary assessments of the geochemistry of the Spratly

Islands area suggest that there may be little likelihood of

finding substantial and easily exploitable yields of oil or

natural gas. Due to numerous territorial disputes, few oil

companies are likely to risk the cost of exploration to

determine whether the potential yields in the area are

commercially viable. This situation might change, however,

given the high oil prices of recent years.

I. CONFLICTING TERRITORIAL CLAIMS

Who owns the South China Sea? Who has rights of

navigation through its waters? Who is responsible for its

environment? International law is ambiguous on these

questions. To the north, the Pratas Island and the

submerged Macclesfield Bank are claimed by Taiwan and

China. China and Taiwan have tacitly tolerated each other’s

identical claim to practically the entire South China Sea

because both base their claim on the same historic grounds.

All the Paracel Islands are claimed by Vietnam, Taiwan,

231
and China on historic grounds, although these have been

occupied exclusively by China since 1974.

Further south, the Spratly Islands are claimed by China,

Taiwan, Vietnam, the Philippines, Malaysia, and Brunei.

Of the six, all but Brunei have sought to strengthen their

claims by establishing a military presence on at least one of

the Spratlys. Although their claims to exclusive economic

zones overlap, all six allege that their claims are fully

supported under international law and under the 1982

United Nations (U.N.) Convention on the Law of the Sea

which entered into force in 1994. Finally, the claims of

China, Taiwan, and Vietnam overlap portions of Indonesia’s

claim in the Natuna area. These claims are summarized in

Table 1.

How did this situation come about? The United States

Institute of Peace reports that:

The question of who owns the 400-plus rocks, reefs, and

islands (known as the Spratly Islands) that are scattered

within an 800,000-square-kilometer area within the South

China Sea was largely ignored until the 1970s.... During

the 1980s and 1990s, most of the disputing states have

found themselves in a race to bolster their claims to

sovereignty by gaining occupation of the islands that can

support a physical presence or by establishing markers on

the islands where physical occupation is not feasible. In

some cases claimants have even built structures on features

that are completely submerged at high tide, maintaining a

physical presence on these island specks under arduous and

mind-numbing physical conditions. Currently, Vietnam

occupies more than twenty islets or rocks, China occupies

eight, Taiwan one, the Philippines eight, and Malaysia

three to six. 4

Ironically, the U.N. Law of the Sea Convention—which

intended to resolve maritime disputes—may have

exacerbated them, at least in the short-term. The 1982

convention created a number of guidelines concerning the

status of islands, the continental shelf, enclosed seas, and

territorial limits. Three of the guidelines which are most

relevant to the South China Sea are:

232
233

Table 1. Territorial Claims in the Spratly and

Paracel Islands.

1. Article 3, which establishes that “every state has the

right to establish the breadth of its territorial sea up to a

limit not exceeding 12 nautical miles;”

2. Articles 55–75, which define the concept of an

Exclusive Economic Zone (EEZ), an area up to 200 nautical

miles beyond and adjacent to the territorial sea. The EEZ

gives coastal states “sovereign rights for the purpose of

exploring and exploiting, conserving and managing the

natural resources, whether living or nonliving, of the waters

superjacent to” (above) “the seabed and of the seabed and its

subsoil . . .”

3. Article 121, which states that rocks that cannot

sustain human habitation or economic life of their own shall
have no exclusive economic zone or continental shelf.

The establishment of the EEZ created the potential for

overlapping claims in semi-enclosed seas such as the South

China Sea. These claims could potentially be extended by

any nation which could build a settlement on the islands in

the region and attempt to establish a clear title. South

China Sea claimants have clashed as they tried to establish

(mostly military) outposts on the islands in order to be in

conformity with Article 121 in pressing their claims.

Spratly Islands.

The total land area of the Spratly Islands is less than

three square miles. The islands are important, however, for

strategic and political reasons, because ownership claims to

them are used to anchor claims to a 200-mile exclusive

economic zone in the surrounding seas.

China’s claims to the Spratly Islands, called the Nansha

Islands by many Chinese observers, are detailed at length

in an official statement of the PRC Ministry of Foreign

Affairs.5

China has indisputable sovereignty over the Nansha

Islands and their adjacent waters. It was the first to

discover and name the islands as the Nansha Islands and

the first to exercise sovereign jurisdiction over them. We

have ample historical and jurisprudential evidence to

support this, and the international community has long

recognized it. During World War II, Japan launched the war

of aggression against China and occupied most of China’s

territory, including the Nansha Islands. It was explicitly

provided in the Cairo Declaration, the Potsdam

Proclamation and other international documents that all

the territories Japan had stolen from China should be

restored to China, and naturally, they included the Nansha

Islands. In December 1946, the then Chinese government

sent senior officials to the Nansha Islands for their recovery.

A take-over ceremony was held on the islands and a

monument erected in commemoration of it, and the troops

were sent over on garrison duty. In 1952 the Japanese

Government officially stated that it renounced all its “right,

234
title and claim to Taiwan, Penghu Islands as well as

Nansha and Xisha islands”, thus formally returning the

Nansha Islands to China. All countries are very clear

about this part of historical background. As a matter of

fact, the United States recognized China’s sovereignty

over the Nansha Islands in a series of subsequent

international conferences and international practice.

This official memorandum continues for several pages

and makes reference to a much wider Chinese claim to the

South China Sea. These are illustrated in the “nine-dash

line” map of Chinese claims in the South China Sea, first

drawn in the 1930s and published by the Republic of China’s

Kuomintang government in 1947 (See Figure 1.6

) It appears

to treat the South China Sea as if it were an area under the

administration of its adjacent province. According to many

authorities, this is inconsistent with the U.N. Convention

on the Law of the Sea, which limits sovereignty claims to 12

nautical miles. It is also unlikely that any of the South

China Sea islands, especially the Spratly Islands meet the

qualifications of a territory entitled to an exclusive

economic zone of 200 miles.7

The PRC has constructed facilities on formerly

unoccupied reefs in the Spratly area, but has not made any

attacks against islets or reefs that are already occupied by

other states. Mindful of other countries’ claims, it has

repeatedly expressed a preference for resolving disputes

bilaterally with each of the other claimant states and has

repeatedly rejected proposals for multilateral negotiations,

especially with countries from outside the region. It has

repeatedly promised to follow the rules established in the

1982 U.N. Convention on the Law of the Sea for resolving

territorial disputes.

At the same time, it has also suggested that it would

agree to shelve sovereignty disputes while establishing

some form of still-undefined joint development of regional

resources. More recently, it has indicated it would take part

in multilateral talks within the region about specific issues,

such as the possibility of developing a code of conduct.

235
236

Figure 1. China’s Nine-Dash Line Map of South

China Sea Claims.
All this amounts to an inconsistent and unclear policy. It

is further complicated by other disputes among the littoral

states of the South China Sea. For example, Indonesia’s

ownership of the gas-rich fields offshore of the Natuna

Islands was undisputed until China released an official map

with unclear maritime boundaries indicating that Chinese

claims in the South China Sea might extend into the waters

around the Natuna Islands.8 Indonesia responded by

choosing the Natuna Islands region as the site of its largest

military exercises to date in 1996. Subsequent

consultations between Indonesia and China did not resolve

the issue. The PRC as well as the Republic of China on

Taiwan both remain vague about the sovereignty claims

implied by the nine-dashed line.9

The Philippines’ Malampaya and Camago natural gas

and condensate fields are in Chinese-claimed waters. The

Philippine Government Department of Energy has given

approval to Shell Philippine Exploration to build a 500 km

undersea pipeline to bring gas from the

Camago-Malampaya field to the main island of Luzon.

China has not voiced a specific objection to the development

of these fields.

Many of Malaysia’s natural gas fields located offshore

Sarawak also fall under the Chinese claim, but as with the

Philippine gas fields, China has not specifically objected to

their development.

Vietnam and China have overlapping claims to

undeveloped blocks off the Vietnamese coast. A block

referred to by the Chinese as Wan’ Bei-21 (WAB-21) west of

the Spratly Islands is claimed by the Vietnamese in their

blocks 133, 134, and 135. The inability to resolve these

disputes has prevented Conoco and PetroVietnam from

undertaking the exploration in these blocks that had been

planned under a tentative pact. In addition, Vietnam’s Dai

Hung (Big Bear) oil field is at the boundary of waters

claimed by the Chinese.

237
Maritime boundaries in the gas-rich Gulf of Thailand

portion of the South China Sea have not been clearly

defined. Several companies have signed exploration

agreements but have been unable to drill in a disputed zone

between Cambodia and Thailand.

Overlapping claims between Thailand and Vietnam

were settled on August 8, 1997, and cooperative agreements

for exploration and development were signed for the

Malaysia -Thai and Malaysia-Vietnam Joint Development

Areas in 1993.

Military Conflicts and Conflict Resolution Efforts.

Military skirmishes have occurred numerous times over

the past 3 decades. In 1974, China invaded and captured the

Paracel Islands from Vietnam. Another confrontation

occurred between the Chinese and Vietnamese over the

occupation of Fiery Cross Reef (Yung Shu Jiao) in 1988. PRC

forces sank three Vietnamese vessels, killing 72 people.

Another incident began with the discovery that the

Chinese had occupied Mischief Reef, a circular reef within

200 miles of the Philippine island of Palawan, and within

the area claimed by the Philippine government as its

Exclusive Economic Zone (EEZ). This involved encounters

between military vessels from the Philippines and the PRC

in March and April 1995.10 These and other recent conflicts

are summarized in Tables 2 and 3.

Indonesia took the initial leading role in diplomatic

initiatives and cooperative agreements to resolve South

China Sea issues, particularly through the Association of

Southeast Asian Nations (ASEAN), which has called for the

peaceful arbitration of territorial claims. ASEAN has held a

number of meetings with China and Taiwan on these issues.

They have also been discussed at the larger ASEAN

Regional Forum (ARF), which draws together 22 countries

involved in the security of the Asia-Pacific region.

238
Given that a territorial settlement is unlikely in the

short term, other avenues of regional cooperation have

emerged. Since 1990 a series of workshops on “Managing

Potential Conflicts in the South China Sea” have been held

under the auspices of the Indonesian government’s

Research and Development Agency within the Department

of Foreign Affairs.11 These non-governmental gatherings,

attended by government and military officials in their

private capacities as well as by academics from ASEAN

countries as well as China, Taiwan, and Canada, have been

convened to explore ways to promote cooperation among the

239

Table 2. Disputes over Drilling and Exploration in

the South China Sea.
nations bordering on the South China Sea. The group has

been helpful in coordinating scientific marine research and

environmental protection. This, in turn, has provided an

authoritative basis for intergovernmental policy within

ASEAN.

At the ASEAN Summit in November 1999, ASEAN

members proposed a general code of conduct for resolving

disputes in the region. China, which is a member of the

ARF, argued in the past that the resolution of territorial

disputes should be a bilateral issue. However, since

November 1999, it has begun a dialogue with ASEAN on the

240

Table 3. Recent Military Clashes in the South

China Sea.
idea of a “code of conduct” governing actions by claimants. In

general, ASEAN members have pushed for specific

commitments to refrain from additional occupation of reefs

or new construction, while China has favored a more vague

commitment to refrain from actions that would complicate

the situation.

Progress toward developing a regional code of conduct

has continued, though at a slow and uneven pace. On the

one hand, Malaysian Foreign Minister Syed Hamid bin

Syed Jaafar Albar stated that it was his belief that ASEAN

nations had agreed that the territorial disputes were an

ASEAN issue, and should not be resolved in other

international forums. 12 On the other hand, China has

shown a preference for engaging in bilateral talks with

Vietnam to resolve disputed boundaries in the Gulf of

Tonkin, as well as land boundaries.

In a dramatic turnabout on December 25, 2000, Chinese

president Jiang Zemin signed agreements in Beijing with

visiting Vietnamese counterpart Tran Duc Luong to settle a

long-standing territorial dispute over resources in the Gulf

of Tonkin. The two pacts demarcate territorial waters and

exclusive economic zones and outline fisheries cooperation

in the Gulf of Tonkin, known as the Beibu Bay in China. The

accords included a joint statement for all-round cooperation

in the new century, an agreement on the delimitation of the

Gulf of Tonkin territorial sea, the exclusive economic zone

and continental shelves, and two intergovernment

agreements on the peaceful use of nuclear energy and on

fishing cooperation in the Gulf of Tonkin.

The joint statement said that both sides would seek a

solution to their remaining marine territorial issues

“through peaceful negotiations.” It said the two counties

“will not take actions to complicate or aggravate disputes.

Nor will they resort to force or threat of force.”13 The

agreements indicate the steadily improving relations

between the communist neighbor states who fought a brutal

border war 21 years ago.

241
Vietnam had wanted to include the dispute over the

Paracel Islands in a regional code of conduct. However,

other ASEAN members have not supported this proposal

because the Paracels are disputed only between Vietnam

and China.

Are the Spratly Islands worth fighting for? Some

contend that they are not astride any major sea lanes and

have little military significance.14 If China really was

determined to push the Philippines or Vietnam out of

contested areas, it could do so from its military bases in

Hainan and the Paracels. There have been many low-level

incidents, but no major wars in the Spratlys, because no

country has any major stakes there. Nevertheless, no one

will foreclose options because of the lure of resources.

The belief—still unproven—that the South China Sea

contains large deposits of resources has exacerbated the

problem of territorial disputes.15 While the claimants have

agreed, in principle, to renounce the use of force to resolve

the dispute, there is almost no agreement as to how to

resolve the issue.

One common suggestion is that the various claimants

should sign a Joint Development Agreement (JDA) in order

to prevent conflict. They would agree to put aside questions

of sovereignty and cooperate in joint resource development

in the disputed area. The problem with this approach,

however, is there is still little agreement among the

claimants as to how this cooperation would work. Given the

ambiguous, incomplete, and often contradictory claims to

the islands of the South China Sea, a political

settlement—not a legal solution—may be the only realistic

means of resolving these complex issues.

Given the paucity of proven reserves, it seems unlikely

that any of the claimants would be willing to engage in

full-scale war to enforce their claims. This situation may

change, however, as their energy and resource needs grow.

242
II. CONFLICTING CLAIMS TO OIL AND NATURAL

GAS RESERVES

Over most of the past 2 decades, industrial output and

energy consumption have grown faster in the countries

around the South China Sea than anywhere else in the

world, driven by the region’s rapid economic growth and

increasing population. It would be convenient indeed if

fossil fuel reserves could be located within the region.

How much oil and natural gas might there be under the

South China Sea? According to the U.S. Energy Information

Agency, the South China Sea region has proven oil reserves

estimated at about 7.8 billion barrels. Current oil

production in the region is over 1.9 million barrels per day.

Beyond that, estimates vary widely. According to a 1995

study by Russia’s Research Institute of Geology of Foreign

Countries, the equivalent of six billion barrels of oil might be

located in the Spratly Islands area, of which 70 percent

would be natural gas. According to Chinese media outlets,

the South China Sea may be “the second Persian Gulf.”

Some Chinese specialists have asserted that the South

China Sea could contain as much as 150 billion barrels of oil

and natural gas.16 Recent estimates of fossil fuel reserves

from the U.S. Energy Information Agency are summarized

in Tables 4 and 5.

In general, the Chinese estimates mentioned above are

much higher than U.S. estimates. However, there is little

hard evidence to substantiate the PRC claims. In the

Spratlys, because of a lack of exploratory drilling, there are

no proven oil reserve estimates. No commercial oil or gas

has been discovered there. Nevertheless, oil and natural gas

consumption in East Asia is widely expected to increase

steadily for many years to come. For want of a source closer

to home, the PRC, which has the region’s largest projected

energy demand, is looking to the Middle East for oil imports.

China’s growing dependence on imported oil from the

Middle East has led to a substantial increase in shipping

through the South China Sea.

243
*Only the regions around the South China Sea are included. Note: There are no proved reserves for the

Spratly and Paracel Islands. Proved oil and natural gas reserves are as of 1/1/2001 (except China and

Indonesia South China Sea regions, where data is as of 1998). Oil production is a 2000 average through the

first 11 months (except China and Indonesia South China Sea regions, where data is as of 1998). Oil supply

includes crude oil, natural gas plant liquids, and other liquids. Natural gas production is the 1999 average,

except for Indonesia, where production from the West Natuna gas field, which began in 2000, is included.

Source: U.S. Energy Information Agency, Country Analysis Brief, http://www.eia.doe.gov/

emeu/cabs/schina.html.

Table 4. Oil and Gas in the South China Sea

Region.

Proved reserves as of 1/1/2001.

Oil production as of 2000. Oil supply includes crude oil, natural gas plant liquids, and other liquids.

Natural gas production as of 1999 (except for the Caspian Sea Region, which as an estimate for 2000).

Source: US Energy Information Agency, Country Analysis Brief, http://www.eia.doe.

gov/emeu/cabs/schina.html

Table 5. Oil and Gas in the South China Sea—

Comparison with other Regions.

244
III. MAINTENANCE OF FREEDOM

OF NAVIGATION

The South China Sea has become one of the world’s

busiest international sea lanes. More than half the world’s

annual merchant shipping traffic sails through the Straits

of Malacca, Lombok, and Sunda. Crude oil, liquefied natural

gas, coal, and iron ore comprise the bulk of shipping traffic.

Over 100,000 oil tankers, container ships, and other

merchant vessels transit the Straits each year. The oil

tankers carry over three million barrels of crude oil through

the straits each day.17

Tanker traffic through the Strait of Malacca at the

southwestern end of the South China Sea is more than three

times greater than Suez Canal traffic, and well over five

times more than the Panama Canal. Over 9.5 million

barrels of oil per day flow through the Strait of Malacca.

Over 80 percent of oil imports for Japan, South Korea, and

Taiwan flow through the South China Sea. 18

Oil tanker traffic—already high—is expected to increase

substantially with the projected increase in Chinese oil

imports. Over the next 20 years, oil consumption among

developing Asian countries is expected to rise by 4 percent

annually on average, with about half of this increase coming

from China. If this growth rate is maintained, oil demand

for these nations will reach 25 million barrels per

day—more than double current consumption levels—by

2020.19 Almost all of this additional Asian oil demand, as

well as Japan’s oil needs, will need to be imported from the

Middle East and Africa. Most all of it will pass through the

strategic Strait of Malacca into the South China Sea.

Supertankers going to Japan will pass through the wider

Lombok Strait east of Bali.

Current and projected oil shipments dramatize the

strategic importance of the South China Sea region, and

qualify the Strait of Malacca as a major chokepoint in the

world’s oil transport system. The narrowest point of this

245
shipping lane is the Phillips Channel in the Singapore

Strait, which is only 1.5 miles wide at its narrowest point.

This creates a natural bottleneck, with the potential for a

collision, grounding, or oil spill.

The disruption of shipping or any threat to close or

restrict access through the Strait of Malacca would have a

significant impact on world oil prices. If necessary, shippers

could avoid the Strait, but only at some additional cost,

time, and disruption.

All the countries of East Asia who depend heavily on oil

imports—in particular, Japan, South Korea, Taiwan, and,

increasingly, China—have a strong common interest in the

safety and freedom of navigation through these crowded,

narrow waterways. The shipping of energy through the

South China Sea is more important than any possible oil

resources in disputed waters.20

China has explicitly stated it will uphold the security of

regional sea lanes.21 To ensure this, China and other major

shipping nations in the region all participate in the APEC

Transportation Working Group (TPT-WG), which aims to

increase the efficiency and safety of the regional

transportation system through coordination and training

for managing port and cargo traffic. They take part in the

APEC TPT-WG and other international maritime

organizations to pursue their common interests in securing

freedom of navigation for their vital imports.

As Ji Guoxing notes, “proceeding from its economic

interests, China is fully aware of the importance of the sea

routes.”22 As a member of the International Maritime

Organization (IMO), China has signed bilateral maritime

transportation agreements with 51 countries, making

positive efforts to promote international cooperation and

exchanges in maritime transportation. At the 16th to 20th

sessions of the IMO, China was successively elected as an

A-level council member state. China has also acceded to

over 30 conventions formulated by the IMO.23

246
To date, the Chinese government has accepted all the

major international conventions related to maritime safety

and pollution prevention. These include the Safety of Life at

Sea Convention of 1974, Regulations for Preventing

Collisions at Sea Convention of 1972, Search and Rescue

Convention of 1979, Convention for the Prevention of

Pollution from Ships, 1973/78, among others.24

IV. PIRACY AND SEA ROBBERY

The large volume of shipping in the South China Sea

region has created opportunities for attacks on merchant

shipping. In the 1990s, more than half of the world’s reports

of piracy took place in the South China Sea. Attacks on

shipping include both piracy, defined as illegal acts for

private gain on the high seas, as well as sea robbery, attacks

taking place within 12-mile territorial limits.

At the beginning of the 1990s, there was a surge in

reports of piracy around the Strait of Malacca. After

Indonesia, Malaysia, and Singapore started coordinating

their surveillance efforts, however, piracy attacks shifted to

the waters around Hong Kong and Hainan. Russian ships

were frequently targeted until Russian frigates arrived in

1995. Piracy attacks then shifted to Indonesian territorial

waters, where they have steadily increased. Reports of

piracy in the South China Sea in 1999 were 40 percent

higher than 1998, and 300 percent higher than 1990 levels.

The big increase in piracy in Indonesian waters and ports

may be attributed to its economic crisis and domestic

instability. It may also be attributed to increasingly

sophisticated attacks by organized crime groups. In the new

millennium of piracy, ships are targeted in port, and then

tracked and boarded in vulnerable areas beyond national

jurisdiction. Cargo is offloaded and readily disposed;

captured ships are then repainted and reflagged.25

The response of littoral countries was delayed by

uncertainties over legal jurisdiction, disputed sovereignty,

and uncoordinated efforts at recovery of crew, cargo, or

247
ships. Even when pirates were detected, “hot pursuit”

across national boundaries was seldom attempted. In recent

years, however, greater efforts have been exerted. The

International Piracy Control Center in Kuala Lumpur, and

the International Maritime Organization’s Piracy

Reporting Centre in London have stepped up monitoring

efforts. The ARF convened a meeting of maritime specialists

to coordinate coast guard action, information exchange, and

investigation of piracy reports. Japanese coast guard

authorities called for a regional coordinated coast guard

surveillance program and hosted a conference to discuss

anti-piracy technologies. Singapore, Malaysia, and

Indonesia have begun joint patrols of the seaways.

Notwithstanding all the conflicting territorial claims,

China has called for joint exercises with its South China Sea

neighbors to control piracy and drug smuggling.

Enforcement of penalties has been especially strict in

China. In December 1999, 13 pirates were convicted and

executed for seizing the cargo ship Cheung Son and

murdering its crew of 23.26

All the major trading countries of the region together

with their shipping companies have a strong common

interest in the safety and freedom of navigation through the

perilous, crowded, narrow waterways of the South China

Sea. The PRC is no exception. The Chinese government

recognizes its shared interest with the other countries of

this region and has cooperated with regional and

international maritime agencies to combat piracy

threatening their vital imports.

V. ENVIRONMENTAL POLLUTION AND

RESOURCE DEPLETION

The problems of environmental pollution and resource

depletion around the South China Sea are generally due to

population growth and urbanization in coastal cities, and

highly polluting technologies for energy production and

primary resource extraction. Among the many

248
environmental issues in the region, the problem of

dwindling fish stocks is of pressing concern.

Fisheries are very important in Southeast Asia. They

provide inexpensive sources of protein, increased job

opportunities, and revenue for foreign exchange. In the

mid-1990s, the region produced over eight million metric

tons live weight of marine fish per year, about 10 percent of

world total catch.27 In addition, more and more coastal areas

were converted for aquaculture of shrimp and fish, a

booming industry of economic importance in the region.

However, as more people move to coastal cities around

the South China Sea, the pressure to increase fish catch

leads to overfishing, an extremely destructive force in the

South China Sea. Destructive and illegal fishing

methods—common in China, the Philippines, Indonesia,

and Malaysia—include dynamite blasting, coral mining,

and cyanide “fishing” to stun fish for live collection.

China depends heavily on fishing resources; one-fourth

of all PRC aquatic products comes from the South China

Sea. According to fishery specialists, the potential catch of

the South China Sea is in the area of 2.5 million tons;

however, in 1998, the marine catch in Guangdong, Guangxi,

and Hainan provinces had reached 3.1 million tons. With

70,000 boats, the fleet has increased ten times over in the

last 20 years, along with considerably decreasing yields per

vessel.28

In 1998, 60 percent of fishing enterprises had lost

money, and many fishermen were unable to sustain their

livelihoods, according to the Guangdong Marine and

Aquaculture Department. In 1999, the Director of

Guangdong Marine and Aquaculture Department, Li

Zhujiang, issued limits on any increase in marine

production and disallowed introduction of any new fishing

boats. Vice-Minister of Agriculture Wan Baorui imposed a

seasonal moratorium on fishing in the South China Seas,

from June 1 to August 1, due to failing fishery production. In

2000, Liu Guojun, Vice-Director of the Ministry’s Fisheries

249
Department, announced another seasonal ban which

affected an area twice as large as that of 1999. The ban idled

upwards of 30,000 boats and approximately one million

fishermen, as well as 800 boats from Hong Kong and

Macao.29

Soon after the ban, many Chinese fishing fleets ventured

into territorial waters claimed by other countries. The

Philippine navy encountered several Chinese fleets and

sank one boat, causing an uproar from Beijing. One incident

occurred off Scarborough Shoal, another near Mischief Reef

to the west of the island of Palawan. Numerous other

incidents occurred in fishing disputes between Indonesia

and Thailand, Burma and Thailand, and Malaysia and

Indonesia.30

China’s fishing ban also exacerbated the competition for

fish resources coming from distant-water fishing countries,

such as Japan, Korea, Hong Kong, and Taiwan. They have

more powerful boats, more advanced fishing technologies,

as well as most post-harvest technologies. These

distant-water fishing countries are most interested in

catching valuable species such as tuna, skipjacks,

mackerels, and even shrimps in the coastal waters. Thus,

high value species are exported out of the region to

developed countries, while intraregional offshore and

artisanal fishermen compete with each other for dwindling

coastal resources, often violently.

Not surprisingly, fisheries have become a new source of

conflict in the region. The increase in aggressive fishing

methods and competition for dwindling fish resources has

led to many fishing disputes. There have been many

incidents in which naval forces chased foreign commercial

vessels out of territorial waters or arrested foreign nationals

for being in territorial waters. According to the U.S. Energy

Information Agency, these events are too numerous to list.

Vietnam, for example, noted that by 1997 its coastal forces

had driven foreign fishing vessels away on over 2,000

occasions.31

250
In sum, many fishing areas are under threat from

anthropogenic pressures as a result of population growth,

urbanization, and economic growth in the area. Fishing

grounds are being degraded and damaged by land and sea

based human activities, including organic and inorganic

pollution, sedimentation, overfishing, and oil spills.

Policies and reserves to protect fishing areas have been

slowly developing. Numerous recent attempts have been

made to minimize fishing conflicts through negotiations,

fishing agreements, joint ventures and licensing

arrangements.32 Indonesia, for example, has established

joint ventures with Taiwan to catch tuna in their EEZ

waters in the Indian Ocean south of Java; with Thailand for

mackerel in the Natuna Sea; and with Japan for shrimp

fisheries in Java Sea, Arafura and the Mollucca Seas.

The most recent and perhaps the most ambitious

regional action on environmental issues began in earnest

this year with the start of a project entitled “Reversing

Environmental Degradation Trends in the South China Sea

and Gulf of Thailand.” The $30 million dollar project is

funded by the Global Environment Fund and the U.N.

Environment Programme. It aims to coordinate and

improve the efforts of China, Cambodia, Indonesia,

Malaysia, Philippines, Thailand, and Vietnam at managing

the environmental resources of the South China Sea.33

VI. CHINA’S POLICIES TOWARD THE SOUTH

CHINA SEA: “CREEPING ASSERTIVENESS” OR

“STRATEGIC PRAGMATISM”?

Some have argued that the PRC has followed a policy of

“creeping assertiveness”34 or “slow-intensity conflict”35 or

“creeping irredentism and ambiguous threats”36 in the

South China Sea. In their view, China has quietly but

steadily expanded its presence and claims in the region

through policies of intimidation and insinuation. Others

contend that the PRC is following a policy of “strategic

pragmatism” in resolving conflicts with others in the region,

251
and has worked with nations to develop regional

institutions and codes of conduct to resolve disputes.

China’s regional assertiveness can be seen in its

construction of an airstrip and docks for warships on Woody

Island in the Paracels, in its development of aerial refueling

facilities in Zhanjiang, and in military aid that it has given

to Burma to build a naval base on Hanggyi Island and a

monitoring station on Great Coco Island.37 China also

created widespread alarm early in 1995 when it occupied

Mischief Reef. This was the first time that China had

unilaterally changed the status quo at the expense of a

claimant other than Vietnam. It had covertly established its

presence in waters and in an area claimed by the

Philippines as falling within its EEZ. The Mischief Reef,

which the Philippines calls the Panganiban Reef, is 150

miles West of Palawan, the Philippines’ nearest land mass,

and 620 miles Southeast of China. These disputes and

conflicts have led some observers to argue that China has

been too willing to resort to force and therefore poses a

growing threat to regional security. 38

China’s strategic pragmatism can be seen in its attempts

to resolve its ocean frontier disputes peacefully.39 For

example, in the Mischief Reef case mentioned above, when

the ASEAN Foreign Ministers gathered at Brunei for the

ARF meeting in July 1995, Chinese Foreign Minister Qian

Qichen expressed China’s readiness to discuss the Mischief

Reef issue with all the ASEAN claimants, thereby reversing

its previous insistence that it would discuss this only

bilaterally with each claimant. While he reiterated China’s

claim of “indisputable sovereignty” over the Spratlys, he

also indicated that China would be willing to recognize

international laws, including the 1982 U.N. Convention on

the Law of the Seas, as a basis for settling the differences.

The Chinese unilateral action on Mischief Reef should not

be viewed as a premonition of more aggressive actions to

further assert its claims, according to Ralph Cossa. “A

blatant, unprovoked use of military force seems the most

252
unlikely potential trigger for conflict” in the South China

Sea.40

China has also cooperated in multilateral and bilateral

talks on scientific research, fisheries management,

environmental protection, and security for shipping.41

According to Carlyle A. Thayer, “China has moved

methodically to put its long-term relations with Southeast

Asia on a firm foundation through cooperative framework

agreements.”42 ASEAN governments have reciprocated in

what might be termed a “Gulliver” strategy of lashing China

to Southeast Asia with myriad ties of mutual interest.43

China’s restraint can be seen in the November 1998

incident, where Philippine naval forces seized 6 Chinese

fishing vessels and arrested 20 fishermen. Chinese

government authorities merely requested the return of

several detained fishermen from Philippine authorities. In

1999, one Chinese boat was sunk in May and another in

July. In another Philippine-Chinese conflict in 2000, the

captain of a Chinese fishing boat was killed. In all cases,

there were Chinese protests, but no retaliation.44 Neither

China nor the Philippines have allowed these long-standing

irritants to cause deterioration in bilateral relations,

according to Carl Thayer.45 “If aggressiveness means

attempts to change the status quo," then over the years,

Malaysia and the Philippines have been the “most

aggressive” of the countries in this region, according to

Ralph Cossa.4 6 The most violent conflicts in the

region—between China and Vietnam in 1974 and

1988—have also been those which have come closest to

resolution. The December 2000 agreement on the Tonkin

Gulf, as noted above, represented a dramatic reversal of

earlier Chinese policies.

Thanks to their growing mutual interests in resource

management and shipping security, China and the ASEAN

have a basis for extending the code of conduct proposed in

1999 and developing it into a process of genuine conflict

resolution. The code of conduct already offers constructive

253
guidelines for behavior. It includes confidence-building

measures; for example, nations are encouraged to give

public assurance that they will resort to nonviolent means

to settle disputes. It seeks to foster public awareness of

different nations’ interests and claims. It calls for an end to

occupation and annexation of unoccupied territories, the

reduction of garrisons and military patrols in contested

areas, the standardization of naval operations, and the

improvement of communication (especially the

development of hotlines to deal with crisis situations).

Satellite image technology, first employed on a regional

basis to detect smoke haze from Indonesian forest fires, can

also be used to monitor other environment and security

agreements.47 The code proposal is still voluntary; however,

it is an important step toward a genuine regional conflict

resolution process.48

Caveats.

Three factors may influence the pace of developing a

regional dispute settlement mechanism: Taiwan’s role,

internal security threats within the region, and world oil

prices.

Taiwan’s role. As the forum for regional negotiations

takes shape, more effort and thought needs to be given to

finding a creative diplomatic formula for incorporating

Taiwan’s participation. Taiwan forces occupy the two

largest islands in the South China Sea: Pratas Island

(approximately 200 miles southeast of Hong Kong in the

northern South China Sea) and Itu Aba (approximately

1300 miles south of Taiwan in the southern South China

Sea). Taiwan has reduced its garrison on Itu Aba; defense

responsibilities have been transferred from the ROC Navy

to the ROC Coast Guard. This implies that Taiwan is no

longer prepared to use force to defend this islet.49 To the

contrary, it is developing facilities for tourism there.50

There is a curious pattern of accommodation in

PRC-Taiwan relations. On the one hand, the PRC views

254
Taiwan as a renegade province; Taiwan views the mainland

with cultural empathy but political disdain. On South

China Sea issues, however, they are often in agreement.

They have not had any direct confrontations in the South

China Sea. They make the same claims and use the same

definitions, baselines, and maps in stating their interests in

the region. There is even some direct cooperation between

China and Taiwan on technical issues.

Adding another country would certainly make

multilateral negotiations more difficult. But

Taiwan—which occupies the largest amount of territory in

the SCS—has to be involved in the process.

Regional instability. The South China Sea is not only a

region of conflicting claims; it is surrounded by local

conflicts in Aceh, Borneo, West Papua, Muluccas, and

Mindanao, as well as widespread illegal activities. Political

instability in Indonesia has weakened its ability to take an

active role in regional dialogue. Internal security threats

there and elsewhere may impair progress toward

developing a regional code of conduct.

World energy prices. What will happen if world oil prices

continue to rise, and PRC energy demand continues to rise?

The PRC government may find it in its vital interest to

secure essential supplies such as fuel imports or nearby

energy reserves. There are very meager proven resources in

the South China Sea at this point in time, possibly because

there has not been much exploration. This in turn is a

function of widespread border disagreements and the

failure of the various claimants to cooperate in the joint

development of the resources. At some point, the PRC might

push harder to secure what it considers vital resources for

national development.

CONCLUSION

Given the increased activity around the South China

Sea, it is not surprising that there have been many and

255
varied kinds of conflicts. The evidence presented here

indicates that, on the whole, China has responded to these

conflicts through cooperative regional institutions rather

than confrontational, unilateral means. Chinese

authorities have determined that transportation for oil

imports through the South China Sea is more important

than oil and natural gas exploration under the South China

Sea. The PRC has pursued this policy of regional

cooperation rather than unilateral action to help feed its

growing population and fuel its industrialization.

ENDNOTES - CHAPTER 11

1. These observations and the tables in this chapter are based on the

authoritative Fact Sheet on the South China Sea provided by the U.S.

Energy Information Agency. Updated periodically, it is available online

at http://www.eia.doe.gov/emeu/cabs/schinatab.html.

2. See “Coral Reefs in Southeast Asia,” in Coral Reefs and

Mangroves of the World, http://www.wcmc.org.uk/marine/data/

coral_mangrove/marine.maps.main.html.

3. Chou Loke Ming and Porfiro M. Alino, Underwater Guide to the

South China Sea, Singapore: Times Editions, 1993.

4. “The South China Sea Dispute: Prospects for Preventive

Diplomacy,” U.S. Institute of Peace, March 1995.

5. “The Issue of South China Sea,” Ministry of Foreign Affairs,

People’s Republic of China, June 2000, http://www.fas.org/news/

china/2000/china-000600.htm.

6. The nine-dash line map is discussed and presented in Stein

Tonnesson, “China and the South China Sea: A Peace Proposal,”

Security Dialogue, Vol. 31, No. 3, September 2000, pp. 307-326. Also see

“South China Sea Islands,” University of Texas Library.

http://www.lib.utexas.edu/Libs/PCL/Map_collection/middle_east_a

nd_asia/SChina_Sea_88.jpg. Also see “Territorial Claims,” South

China Sea WWW VL. http://www.middlebury.edu/

SouthChinaSea/maps/oilclaims.gif.

7. Christopher Joyner, “Diplomatic and Legal Context,” Mitigating

the South China Sea Disputes: Cooperative Monitoring & Conflict

Prevention in the Age of Global Transparency, U.S. Institute of Peace,

256
Events Archive, December 12, 2000. Webcast at

http://www.usip.org/oc/events/south_china_sea.html. Also see Ian

Townsend-Gault, Legal and Political Perspectives on Sovereignty over

the Spratly Islands, Workshop on the Conflict in the South China Sea,

University of Oslo, Norway, 24-26 April 1999. http://www.sum.uio.no/

southchinasea/Activities/WorkshopPapers.htm.

8. Tonnesson, “China and the South China Sea,” pp. 307-326.

9. For a recent scholarly attempt to justify PRC and Taiwan claims

in the South China Sea, see Yann-Huei Song and Zou Keyuan,

“Maritime Legislation of Mainland China and Taiwan: Developments,

Comparison, Implications, and Potential Challenges for the United

States,” Ocean Development and International Law, October-December

2000, Vol. 31, pp. 303-345.

10. Andrew Sherry, “More Mischief,” Far Eastern Economic Review,

November 19, 1998, p. 17.

11. For further details, see the South China Sea Informal Working

Group at the University of British Columbia website,

http://www.law.ubc.ca/centres/scsweb. Also see Tom Næss,

Environment and Security in the South China Sea Region: The Role of

Experts, Non-Governmental Actors and Governments in Regime

Building Processes, Thesis, Candidate Political Degree, Department of

Political Science, University of Oslo, December 1999. SUM

Dissertations & Thesis series No. 1/2000 (ISSN 0806-475X).

http://www.sum.uio.no/southchinasea/beyond/publications.htm.

12. U.S. Energy Information Agency, Country Analysis

Brief—South China Sea. February 2001. http://www.eia.doe.gov/

emeu/cabs/schina.html.

13. The full text of the agreements can be seen on the PRC Foreign

Ministry web site at http://www.fmprc.gov.cn/eng/4471.html. Also

see “China, Vietnam ink Tonkin Gulf border deals,” Muzi.com URL:

http://latelinenews.com.

14. Michael McDevitt, “Security Trends and Concerns,” Mitigating

the South China Sea Disputes: Cooperative Monitoring & Conflict

Prevention in the Age of Global Transparency, U.S. Institute of Peace,

Events Archive, December 12, 2000. Webcast at

http://www.usip.org/oc/events/south_china_sea.html. Also see Evan

Feigenbaum, “China’s Military Posture and the New Economic

Geopolitics,” Survival, Vol. 41, No. 2, Summer 1999, pp. 71-87. Also see

Michael G. Gallagher, “China’s Illusory Threat to the South China Sea,”

257
in East Asian Security, Michael E. Brown, Sean M. Lynn-Jones, and

Steven E. Miller, eds., Cambridge: The MIT Press, 1994, pp. 133-158.

15. According to Craig Snyder, “The Implications of Hydrocarbon

Development in the South China Sea,” International Journal, Winter

1996-97.

16. “The South China Sea Dispute: Prospects for Preventive

Diplomacy,” U.S. Institute of Peace, March 1995.

17. D. L. Tookey, “Shipborne pollution and the ASEAN co-operation

plan on transboundary pollution,” Oil and Gas Law Taxation Review,

Oxford, England: ESC Publisher, 1997, pp. 18-23.

18. These data are from the U.S. Energy Information Agency

website, http://www.eia.doe.gov/emeu/cabs/schina.html.

19. Ibid. Also see John Noer, “Southeast Asia Chokepoints,”

Strategic Forum, No. 98, National Defense University, Institute for

National Strategic Studies, December 1996.

20. See the assessments of Erik Kreil, “Energy Demands and

Competition,” Mitigating the South China Sea Disputes, Cooperative

Monitoring & Conflict Prevention in the Age of Global Transparency,

U.S. Institute of Peace, Events Archive, December 12, 2000. Webcast at

http://www.usip.org/oc/events/south_china_sea.html.

21. Chien-peng Chung, “The Spratlys and Other South China Sea

Islands Disputes,” Journal of Social, Political, and Economic Studies,

Vol. 24, No. 1, Spring 1999.

22. Ji Guoxing, SLOC Security in the Asia Pacific, Center

Occasional Paper, Asia-Pacific Center For Security Studies, Honolulu,

Hawaii, February 2000. http://www.apcss.org/Paper_SLOC

_Occasional. htm#_ftn37.

23. “The Development of China’s Marine Programs,” Information

Office of PRC State Council, May 1998, Beijing Review, June 15-21,

1998, p. 16.

24. Ji Guoxing, SLOC Security in the Asia Pacific.

25. Slobodan Lekic, “Indonesian Pirates Defy the Navy and Plunder

Passing Ships,” Associated Press, May 20, 2000. Also see Ninand Sheth,

“Terror on the Sea,” India Today, May 1, 2000.

258
26. “Modern Pirates: Armed and Ruthless,” BBC News, April 24,

2000, 16:20 GMT. Also see Charles Scanlon, “Asian Nations Tackle

Piracy,” BBC News, April 27, 2000, 09:23 GMT.

27. Aprilani Soegiarto, “Sustainable Fisheries, Environment and

the Prospects of Regional Cooperation in Southeast Asia,” paper

Presented at the Nautilus Institute Workshop on Trade and

Environment in Asia-Pacific: Prospects for Regional Cooperation,

September 23-25, 1994, East-West Center, Honolulu.

http://www.nautilus.org/papers/enviro/trade/fishseasia.html#top.

28. “Results of the South China Seas Fishing Ban,” Economic Woes,

http://web.uccs.edu/mmills/documents/economic_woes.htm.

29. “Second Fishing Ban in South China Sea Ends August 1,”

People’s Daily, August 1, 2000. http://english.peopledaily.com.cn/

200008/01/eng20000801_46983.html. Also see Susan Scurloch

Theiler, “USDA GAIN Report,” Foreign Agriculture Service, U.S.

Consulate General of Guanzhou, Guangdong-Hong Kong Information

Daily, February 9, 1999.

30. Acharya Ashayagachat, “Fishing in Troubled Waters,” Bangkok

Post, June 5, 2000. http://www.bangkokpost.net/today/

050600_News19.htm.

31. U.S. Energy Information Administration, South China Sea

Region, February 2001. Footnote to Table 2, Military Clashes in the

South China Sea over the Past Two Decades. http://www.eia.doe.

gov/emeu/cabs/schinatab.html.

32. Aprilani Soegiarto, Sustainable Fisheries.

33. “Framework of Implementation of the South China Sea project,”

U.N. Environmental Programme (UNEP) East Asian Seas Action Plan.

http://www.roap.unep.org/easrcu/index.htm.

34. Gerald Segal, “China’s Creeping Assertiveness,” Wall Street

Journal, March 27, 1997. http://ds.dial.pipex.com/gsegal/

wsjm97.htm. Also see: Ian James Storey, “Creeping Assertiveness:

China, the Philippines, and the South China Sea Dispute,”

Contemporary Southeast Asia, Vol. 21, No. 1, April 1999, p. 100.

35. Andrew Scobell, “Slow-intensity Conflict in the South China

Sea,” FPRI Conference on Flashpoints in East Asia, May 12, 2000.

http://list.gatech.edu/archives/archives/cps/0002.html.

259
36. Richard Sokolsky, Angel Rabasa, C.R. Neu, The Role of

Southeast Asia in U.S. Strategy Toward China, RAND, 2000.

http://www.rand.org/publications/MR/MR1170/.

37. Michael McDevitt, “China and the South China Sea—A

Conference Summary Report,” Center for Naval Analysis, March 11,

1999. http://www.csis.org/pacfor/pac1599.html

38. John Downing, “Maritime Ambition: China’s Naval Ambition,”

Jane’s Navy International, May 1, 1998, p. 8. Also see John Astley and

Michael Schmitt, “The Law of the Sea and Naval Operations,” The Air

Force Law Review, Vol. 42, 1997, pp. 119-155.

39. This thesis is examined in Greg Austin, China’s Ocean Frontier:

International Law, Military Force, and National Development, Allen &

Unwin, 1998.

40. Ralph Cossa, “Security Implications of Conflict in the South

China Sea: Exploring Potential Triggers of Conflict,” PacNet Newsletter,

No. 16, April 17, 1998, Center for Strategic and International Studies

(CSIS) Pacific Forum. http://www.csis.org/pacfor/pac1698.html.

41. See “The Ten Main Findings” Energy and Security in the South

China Sea, Research Programme, Centre for Development and the

Environment, University of Oslo. http://www.sum.uio.no/

southchinasea.

42. Carlyle A. Thayer, “ Regional Rivalries and Bilateral Irritants,”

Comparative Connections: An E-journal on East Asian Bilateral

Relations, Pacific Forum CSIS, First Quarter 2001.

http://www.csis.org/pacfor/cc/0101Qchina_asean.html.

43. The term and sentence are from Marvin C. Ott’s article,

“America and the New Dynamics of Asian Security,” Current History,

April 2001, p. 152.

44. Michael McDevitt, “Security Trends and Concerns,” Mitigating

the South China Sea Disputes. Cooperative Monitoring & Conflict

Prevention in the Age of Global Transparency, U.S. Institute of Peace,

Events Archive, December 12, 2000. Webcast at: http://www.usip.

org/oc/events/south_china_sea.html.

45. Carlyle A. Thayer, Regional Rivalries and Bilateral Irritants,

Comparative Connections, 1st Quarter 2001: China-ASEAN Relations,

Pacific Forum CSIS. http://www.csis.org/pacfor/cc/0101Qchina_

asean.html.

260
46. Cossa’s comment came during discussion at a conference on

Mitigating the South China Sea Disputes. Cooperative Monitoring &

Conflict Prevention in the Age of Global Transparency sponsored by the

U.S. Institute of Peace on December 12, 2000. A webcast is available at

http://www.usip.org/oc/events/south_china_sea.html.

47. For more on the potential of satellite imaging for environmental

and disaster monitoring, piracy response, coral reef analysis, and other

scientific uses, see John Baker, “Formulating a Cooperative Satellite

Monitoring Regime for the South China Sea,” and David Wiencek,

“Assessing the Conflict Potential of the Spratly Islands Disputes,”

“Security Trends and Concerns,” in Mitigating the South China Sea

Disputes. Cooperative Monitoring & Conflict Prevention in the Age of

Global Transparency. U.S. Institute of Peace, Events Archive,

December 12, 2000. Webcast at: http://www.usip.org/oc/events/

south_china_sea.html.

48. For a cogent analysis, see Stein Tonnesson, “China and the

South China Sea: A Peace Proposal,” Security Dialogue, Vol. 31, No. 3,

September 2000, pp. 307-326. Also see Lee Lai To, China and the South

Sea Dialogues, Praeger, 1999.

49. Many thanks to John Garver for this observation.

50. Itu Aba and Pratas Islands have their own web sites to promote

tourism: http://163.29.187.2/english.index1.htm.

261
CHAPTER 12

THE GESTALT OF THE SINO-INDIAN

RELATIONSHIP

John W. Garver

INTRODUCTION

The purpose of this chapter is to provide a framework for

thinking about China-India relations and about the

probable future security situation in the South

Asian-Indian Ocean region. Three concepts provide a useful

framework for this purpose: Gestalt, the structure of power,

and a security dilemma. The chapter will explain the utility

of these three concepts to the analysis of Sino-Indian

relations in the South Asian-Indian Ocean Region

(SA-IOR). It will then look in closer detail at three

particularly important components of the Sino-Indian

Gestalt/balance as they relate to possible future Sino-Indian

conflict. These are (1) the status of Tibet, (2) the

Sino-Pakistan entente, and (3) the status of Myanmar

I. THREE INTERPRETATIVE CONCEPTS

The Gestalt of Sino-Indian Relations.

Gestalt theory is a particular approach to human

psychological states and processes. That approach emerged

early in the 20th century in response to still earlier theories.

These theories saw a point-for-point correspondence

between a physical stimulus and the resulting sensation

apprehended by the perceiving individual. By the end of the

263
20th century, Gestalt theory remained an influential school

within the field of psychology.1

According to Gestalt theory, perceptions in response to

stimuli are greatly influenced by context, by the relation of

the stimuli to other, surrounding elements. At a very basic

level, perceptions of the size, shape, or color of an object are

greatly influenced by the nature of the surrounding field. At

a more complex level, in rendering judgments about what a

particular stimulus “is,” about its meaning, individuals will

be greatly influenced by other cues or signals. Perceptions

are thus relationally determined. Moreover, perceptions

commonly involve a number of elements in dynamic

inter-relationship with each other and with the whole.

When perceiving, individuals perceive a unitary,

integrated, articulated structure emerging from a variety of

elements. This whole pattern is called a “Gestalt.” How a

given individual understands the nature of the unitary

whole (of which various data or stimuli are perceived as

constituent parts) will greatly influence his or her

understanding of those particular parts. A unified,

integrated image of phenomena allows the individual to

interpret, to structure, to make sense of, to make

meaningful, to make comprehensible, various data. In sum,

to make sense of a particular datum, one must understand

the overall Gestalt into which that datum fits.

The interaction between India and China in the South

Asian-Indian Ocean region may be thought of in terms of a

Gestalt. That is to say, Indian and Chinese analysts and

leaders do not view the relationship between their two

countries as merely the summation of the border problem,

differences over the status of Nepal, economic relations,

rivalry or cooperation in global affairs, and so forth. Rather,

they tend to view the relationship as made of all these

elements interrelating to constitute a dynamic whole.

The perceptual Gestalt dominant among both Chinese

and Indian analysts is an image of competition and rivalry

across the SA-IOR. The elements constituting this Gestalt of

264
India-China rivalry consist of a series of geographic regions

and influences plus a number of functional dimensions such

as economic, political, cultural, and military relations. The

constituent elements of this perceptual Gestalt of

Sino-Indian rivalry will be enumerated in the next section.

The point to be made here is that actors on both sides

tend to see these geographic elements and functional

dimensions as tied together, as interacting in a subtle

fashion, to impinge on their nation’s security interests.

What transpires in one geographic region or one functional

dimension, is linked to and influences what occurs, and

what is likely to occur in the future, in other areas. The

significance of any particular geographic feature or

functional relationship cannot be comprehended in

isolation. The inter-relationship among all the parts is

critical.

There is not, of course, a single Gestalt of Sino-Indian

relations among the more than two billion Chinese and

Indian people. One could discern perhaps a half-dozen main

perceptual Gestalts in either country. This chapter will not

undertake to provide a comprehensive look at these many

Gestalts. It will proceed rather on the basis of the

assumption that a Gestalt of Sino-Indian rivalry dominates

policy thinking in both countries, and attempt to explain

that particular, dominant Gestalt.

There is a second core meaning of the concept of Gestalt,

which this chapter will not explore in depth, but which is

worth mentioning. A Gestalt has the potential to cause

misperceptions. A powerful human tendency exists to

“make sense” out of known facts by ordering and structuring

them so as to make them meaningful. This may lead to

efforts to “improve” facts so as to make them fit more closely

into the unifying Gestalt, resulting in misperceptions of

reality. Thus, Chinese or Indians operating on the basis of a

Gestalt of Sino-Indian rivalry may fit events/data into that

Gestalt when in fact those events have little to do with such

265
rivalry. Again, this chapter merely notes but does not

pursue this line of thought.

The Sino-Indian Structure of Power.

Structure of power means the configuration of relative

capabilities distributed among a particular set of states

under specific circumstances. This configuration or

structure of power begins with these variables: the relative

capabilities of the specified states, the alignments among

those states, and the influence of geographic variables.

Understood in this way, the structure of power involves a

wide range of relative national capabilities. These include:

• military capabilities (force levels, troop morale,

training, acuity of strategic thinking),

• technological capabilities (level of weaponry, etc.),

• geographic advantages and handicaps,

• industrial, fiscal, and technological capabilities,

• ideological advantages, and

• broad political and even cultural trends.

The term “structure of power” is preferable to the more

common term “balance of power” because the latter term

has multiple meanings, the most precise of which is very

different from the meaning of “structure of power”

presented in this chapter. The classic definition of balance of

power is a shifting constellation of at least five powers, each

with roughly equal capabilities and with the whole system

operating to keep any single power from dominating the

system and its other state members.2 This definition does

not do much to help us understand the Sino-Indian

relationship. Structure of power as used here is much closer

to the old Soviet-introduced concept of “correlation of

forces.”

266
The structure of power between India and China

includes the following major elements:

1. Geographic areas:3

• the political-military status of Tibet,

• the capabilities and orientation of Pakistan,

• the political-military status of Nepal,

• the political-military status of Sikkim, Bhutan, and

the Chumbi Valley,

• the political-military status of the southern slope of

the eastern Himalayan region (roughly equivalent to

the Indian state of Arunachal Pradesh),

• the political-military status of Myanmar,

• the political-military regime of the Indian Ocean, and

• the political-military status of Bangladesh.

2. Functional areas:

• the level of domestic support and degree of political

purpose behind state efforts to influence events in the

SA-IOR,

• the fiscal capabilities of China and India,

• level of support by major extra-regional powers for

Indian and Chinese actions in the SA-IOR,

• military capabilities, especially the ability of China

and India to project military power in the SA-IOR,

• the relative moral-ideological appeal within the

SA-IOR of policies of China and India,

267
• nuclear deterrent capabilities of India and China

vis-à-vis one another,

• strategic acumen and diplomatic skill of leaders of the

Chinese and Indian states,

• the military and political position of India and China

in Southeast Asia, and

• Chinese or Indian transit rights via Bangladesh

territory.

All these elements fit together to constitute a Gestalt of

the Sino-Indian structure of power, or of the state of

Sino-Indian rivalry at any point in time. Leaders on both

sides of the Sino-Indian divide tend to see the various

elements as interacting to constitute a broad pattern of

competitive, rival relations. The leaders on both sides tend

to see all the elements as fitting together to make up a

situation variously beneficial or adverse to their national

security. They tend to view these elements as a whole and to

be concerned with their inter-relationships.

Since the central concern of this volume is with possible

future military confrontations between India and China, it

is important to remember that states often go to war to

maintain or establish an advantageous balance of power.

Issues that might seem trivial in isolation often become

weighty enough to lead to decisions for war when viewed in a

more totalistic Gestalt. The status of Serbia in 1914 or the

status of South Vietnam in 1964, were minor when seen in

isolation. But when seen in terms of the credibility of the

European alliance system underpinning the European

structure of power, or in terms of the alignment of greater

Southeast Asia in the global contest underway between

Western and Eastern alliance systems, those matters

assumed a much greater significance.

Stated most baldly, my proposition is this: China and

India are likely to consider military conflict with each other

268
when, and perhaps only when, the leaders of one or both

sides conclude that this is necessary in order to maintain an

advantageous structure of power in the SA-IOR.

The Security Dilemma in Sino-Indian Relations.

The third concept useful for understanding Sino-Indian

relations is that of a security dilemma. A security dilemma

exists when a state arms itself for defensive purposes, out of

fears of possible hostile military action by another state.4 It

is not necessary to impute aggressive or hostile intentions to

the other state. Those intentions may now be benign, but

there is no guarantee that they will not quickly change at

some future time. This fundamental fact—that there are no

guarantees for the security of states and that, as a result,

states must provide for their own defense—arises out of the

anarchic nature of the state system. Thus states arm to

defend themselves against what might happen. But by

building up their arms, states become more militarily

powerful, and that necessarily increases the potential

threat those states constitute to other states. Those other

states then, also acting defensively, must arm in response to

the actions of the first states. But by arming, they, too,

increase the threat confronting the first states. All these

states, therefore, in the course of arming themselves for

defensive purposes, become locked in a pattern of mutual

negative interaction.

A security dilemma does not necessarily involve

attribution of aggressive or hostile intent to the other

country in a dyad of interaction. It is quite possible,

however, that this will happen. The objective security

dilemma (arising out of the facts of the anarchic state

system and the derivative need for self-defense) may

become overlaid by mutually reinforcing

misunderstandings. Each side may come to believe that the

other not only constitutes a potential menace by virtue of its

military capabilities, but also is an active threat by virtue of

its intentionally hostile actions.

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It may also become very difficult for each actor to

recognize that its own actions can be seen as menacing by

the other, and to conclude that the arming of the other actor

can only be explained by malevolent, aggressive intentions.

When a situation of mutually reinforcing misperceptions

develops, what Robert Jervis calls a negative spiral may

ensue. Each sees the other’s actions as threatening and its

own actions as purely defensive. Each side arms to defend

itself against the hostile intentions and actions of the other.

Yet both sides believe its own actions are defensively

motivated.

Such a mutual security dilemma exists, I believe, in

Sino-Indian relations across the SA-IOR. Both powers

perceive themselves as acting defensively to influence key

situations and processes in that region. Neither power sees

itself as aggressive, as trying to establish some sort of

exclusive imperium or hegemony over the region. Each

views many of the activities of the other as gravely

threatening, and seeks to counter those hostile, threatening

actions. These defensively motivated counter actions,

however, are seen as threatening by the other power, which

devises its own defensively inspired countermoves in

response.

Let me put some substantive flesh on these conceptual

bare bones. Indian leaders and strategists have

traditionally viewed the SA-IOR as a sort of Indian security

zone, very loosely akin to the way Americans have viewed

Central America and the Caribbean, or the way Russians

have viewed Poland, or the way Chinese have viewed Korea.

Although Indian leaders have not explicitly laid out such a

regional doctrine, Indian behavior in the SA-IOR has

generally conformed to such an implicit doctrine.5 The

military-security presence of virtually all extra-regional

powers has been of concern to Indian leaders, although, of

course, the level of such concern varied with the

circumstances involved. Since the foundation of the People’s

Republic of China in 1949 some Indian leaders—most

famously Sadar Vallabhai Patel—were deeply concerned

270
about Chinese moves toward the SA-IOR.6 Following

India’s traumatic defeat in 1962, Patel’s realistic

perspective became dominant in Indian security policy

circles, at least regarding China. A decade or more of

Sino-Indian rapprochement after 1988 has modified but not

fundamentally altered the dominance of this perspective.

Some Indian analysts see a process of creeping Chinese

“strategic encirclement” of India underway, with Beijing

engineering incrementally but cumulatively important

advances in places like Myanmar (formerly Burma), Nepal,

Bhutan, and Bangladesh—in fact, virtually all the elements

of the Sino-Indian structure of power enumerated above. If

India fails to counter or thwart Chinese moves, regardless of

the Chinese intentions underlying these moves, India will

find the structure of power in the SA-IOR increasingly and

inescapably shifting to China’s advantage and India’s

disadvantage.7 Far more moderate Indian analysts with

less skeptical views of China still find it necessary for India

to resolutely uphold its advantages in key parts of the

SA-IOR.8

Fundamental Chinese perspectives are just as defensive

as the Indian. One transcendent Chinese concern regards

the solidity of Chinese control over Tibet. From the Chinese

perspective, it is indisputable that “Tibet is and has been for

many hundred of years, a part of China.” Indian leaders,

however, have insisted on asserting certain special

interests and relations with Tibet, and have consistently

worked to thwart, weaken, or undermine Chinese authority

in Tibet, at least from the Chinese point of view. Tibet was

the fundamental cause of the 1962 war, again from the

Chinese perspective. The aim of Indian policy prior to the

1962 war, according to authoritative Chinese histories of

that conflict, was to expel Chinese authority from Tibet

thereby transforming Tibet into a buffer zone between

China and India.9

Another fundamental Chinese perspective is that India

abandoned its previously reckless policies toward Tibet and

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adopted more reasonable and cautious policies toward

China including “China’s Tibet," because it was confronted

by superior power. First there was the sobering effect of

Beijing’s tough rejection of Indian protests over Tibet in

1949-50, followed by resolute Chinese moves to secure solid

control over Tibet. Later came the sobering effect of the 1962

defeat. It was the realities of China’s power—of China’s

unalterable control over Tibet, of the Chinese People’s

Liberation Army’s clear ability to best Indian military forces

in the Himalayan region—that laid the basis for the more

cautious Indian policy that eventually emerged after the

1962 war, although it would take a decade for this shift to

manifest itself. Ultimately this more sober, cautious,

realistic Indian perspective would provide the basis for

Sino-Indian rapprochement.

It follows from this Chinese analysis that Indian

restraint toward China and its interests is founded on a

structure of power that constrains India. A strong Pakistan

and a solid strategic partnership between China and

Pakistan are key elements of this India-constraining

structure of power. If other elements of the SA-IOR

structure of power can be shifted in a direction more

favorable to China and more constraining to India, this, too,

will contribute to India acting with greater caution and

restraint vis-à-vis China’s key interests. Thus, China, like

India, is inspired by defensive considerations. Both

countries try to influence a complex set of inter-related

factors in the SA-IOR so as to keep in check the malevolent

inclinations of the other side.

II. COMPONENTS OF THE SINO-INDIAN GESTALT

The Tibetan Factor in the Sino-Indian Structure of

Power.

Let us now take a closer look at three key elements of the

Sino-Indian structure of power which would be particularly

likely to play a role in future conflicts involving China—the

theme of this volume.

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Regarding Tibet, Beijing’s use of Tibet as a military

platform since 1951 has fundamentally altered the historic

structure of power between China and India. Throughout

history Tibet had not permanently hosted large military

forces of the Chinese state. It had served, rather, as a de

facto, though not a de jure, buffer between China and India.

(It was only de facto because all the powers recognized

China’s suzerainty over Tibet.) This traditional status of

Tibet was overthrown in 1950 when, for the first time, Tibet

came under full, effective, and permanent Chinese military

occupation. Over subsequent years Tibet was fully

integrated into the Chinese military system and became a

platform for the projection of Chinese military power.

Indian leaders were deeply aware of the epochal

implications of this change in Tibet’s status for Indian

security, but failed in their efforts to alter the direction laid

out by Beijing. Repeated Indian policy efforts to limit

China’s military use of Tibet failed.

China, for its part, recognizes that it faces a problem in

Tibet because of the profound ethnic cleavage between Han

and Tibetan, the great difficulties of transportation into

Tibet, and widespread international sympathy for the

plight of Tibetan culture under Chinese rule. China’s mortal

fear is that domestic and international factors might

coalesce in such a way as to detach Tibet from the People’s

Republic of China (PRC). Since the break-up of the Union of

Soviet Socialist Republics (USSR) along ethnic lines,

Beijing has adopted a policy of demographic inundation of

Tibet by Han settlers as a final solution to its Tibetan

problem.10 India’s counter to this has been to tacitly support

efforts by the Dalai Lama’s government-in-exile to mobilize

international opposition to Chinese actions in Tibet. The

efforts of India and the Dalai Lama have not had much

impact on Chinese actions, however. New Delhi now faces

the prospect that, within a few decades, Tibet will be

populated by a large Han population and tied far more

closely by road and rail to industrial centers of China

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proper. Beijing’s problem is how to keep India from acting

before this irreversible fait accompli is created.

Chinese analysts typically deny, often vehemently, that

the Tibetan issue is of any relevance to Sino-Indian

relations. This is a manifestation of the Chinese belief that

“Tibet is a part of China” and, by extension, is of no proper

concern to any foreign person let alone government.

Beijing’s line—and I mean that in the precise sense of a

position followed by members of a disciplined Leninist

party—is that the only outstanding issue between China

and India is the border issue.11 Tibet, the Chinese say, is not

an issue in Sino-Indian relations since New Delhi has

recognized PRC sovereignty over Tibet. This position is

itself a reflection of Chinese sensitivity to its vulnerability

in Tibet.

Several developments could lead to Tibet’s re-emergence

as a pressing security issue between Beijing and New Delhi.

One would be intensified Tibetan resistance to Chinese

rule. This might take the form of nonviolent passive

resistance within China, something like the on-going

passive resistance of Falun Gong. Or, we might see

resistance of a more violent kind than that inspired by the

Dalai Lama. A younger generation of Tibetans might reject

the Dalai Lama’s pacifist approach, and begin armed

attacks on Chinese targets within the PRC or abroad.

Growing Tibetan resistance might also occur against a

background of increasing Islamic activity in Xinjiang and/or

the Central Asian countries bordering the PRC.

Developments such as these could well precipitate

debate within the Chinese Communist Party (CCP) over

how to respond. Hardliners, who clearly dominated policy

on the Tibet issue at the time of writing (spring 2001) would

probably insist on stern repression of Tibetan resistance,

accelerated demographic inundation, and a belligerent

response to foreign expressions of concern. More moderate

elements might argue that hardline policies would further

embitter China’s Tibetan population, stimulate stronger

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foreign criticism, and alienate India. The very existence of

these elite divisions could further convince CCP hardliners

that tough policies were necessary.

Another ingredient of a Sino-Indian confrontation

involving Tibet would be an Indian decision to associate

itself with Western criticism of Chinese repression. If New

Delhi chose to disassociate itself from Western criticism,

Beijing would be satisfied. If, however, Indian leaders

decided to join Western criticism of Chinese actions, Beijing

could well resort to coercive diplomacy against India. This

coercion would not necessarily involve direct military

action. Rather it would involve making a variety of

threatening moves, with possible use of military force

looming vaguely but menacingly in the background. This, in

turn, could lead to an escalating spiral of hostility: Chinese

efforts to coerce New Delhi could antagonize India, thereby

exacerbating Indian concerns about China, and inclining

India to make bolder moves to strengthen India’s position

vis-à-vis China.

Tibet constitutes China’s only truly fundamental

vulnerability vis-à-vis India. Tibet is to India, what

Pakistan is to China—a major mechanism for constraining

its rival. Nehru, in fact, played the Tibetan card circa

1960-62 when he countenanced Tibetan resistance as a way

of pressuring China.12 Be that as it may, Indian leaders

have never, to my knowledge, seriously contemplated

military intervention in Tibet in support of a Tibetan effort

to liberate that region from Han rule. Indian and Chinese

analysts are well aware of this possibility, however.

Deterring or defeating Indian military intervention in Tibet

would be a vital Chinese objective. For India, such

intervention would be a high-risk but potentially high

pay-off move. If successful, it could fundamentally shift the

structure of power in favor of India.

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Pakistan and the Sino-Indian Structure of Power.

The existence of a strong and hostile Pakistan is a major

constraint on India. Thanks to Pakistan, India is confronted

with a two-front threat: Pakistan in the west and China in

the north and northeast. The existence of this two-front

threat helps Beijing minimize the danger of possible Indian

intervention in Tibet. In this way, it serves Beijing’s

defensive purposes.

Pakistan can also be counted on to oppose most major

Indian initiatives in the international arena. When India

applies for a permanent seat on the United Nations Security

Council, for example, Beijing can rely on Pakistan to bear

the brunt of opposition leaving Beijing to merely insist that

the decision be unanimous. India’s constant sparring with

Pakistan—one result of Pakistan’s challenges to India and

its policies—reduces India to the level of a regional power,

leaving Beijing to operate at a more elevated Asian and

global level. The geopolitical reality of the multiple benefits

Beijing derives from Indian-Pakistan conflict is the taproot

of the remarkably durable Sino-Pakistan entente.

Would China support Pakistan against India in the

event of another India-Pakistan war? That would probably

depend on the character of that war. China would not risk

alienating India by supporting Pakistan in a war in which

India’s objectives were limited, as, for example, the

mini-war in Kargil in 1999.13 An India-Pakistan war in

which Indian objectives were relatively limited would

probably not produce Chinese support for Pakistan at the

cost of alienating India. On the other hand, an

India-Pakistan war in which New Delhi decided to

definitively subordinate Pakistan would be another matter.

It is possible, indeed even likely, that a war of this sort

might follow a nuclear exchange between India and

Pakistan. In the aftermath of such an event, India might

rouse itself to finally solve the Pakistan problem by

definitively defeating Pakistan and arranging in one

fashion or another that region’s permanent post-war

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subordination to India. Such decisive Indian action would

sorely tempt Chinese intervention.

Beijing would view an Indian effort to subordinate

Pakistan as a manifestation of Indian hegemony. It would

also be hegemony directed against a small neighbor of

China—Pakistan—with a long record of loyalty to and

seeking protection from China. Such a situation would tap

deep memories about the practice of statecraft by China’s

great dynasties throughout history. The success of Indian

hegemonic efforts would also have the consequence of

shifting the SA-IOR balance of power substantially and

permanently in India’s favor. Rather than acquiesce in this,

China might move to support Pakistan. The costs of war

with India would be outweighed by the benefit of preventing

a long-term adverse shift in the structure of power to

China’s disadvantage.

Beijing would have an escalating menu of supportive

moves. These would include:

• political-rhetorical support, including support in the

United Nations,

• lobbying with the U.S. and other governments,

• material support to Pakistan—arms, aircraft, war

supplies, loans, etc.,

• atomic diplomacy in the form of vague but effective

hints that nuclear weapons might be used against

India,

• pressure on India’s northern border to divert forces

from the Pakistan front, and

• outright intervention by Chinese forces.

Beijing would probably seek to retain maximum

flexibility in supporting Pakistan and would probably not

make a formal commitment to support Pakistan. At the

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same time, while the United Sates and other countries

would doubtless make statements opposing Chinese

intervention in the struggle between India and Pakistan,

such statements would not necessarily be effective. Efforts

by Washington, Tokyo, or Moscow to deter a Chinese attack

on India could be taken in Beijing as support for Indian

hegemony and thus as further evidence of the need for firm

action to uphold a structure of power constraining India to

China’s advantage.

Myanmar in the Sino-Indian Structure of Power.

The Shan plateau of northeast Burma provides fairly

easy access from southwestern China to the valley of the

Irrawaddy River. For over 2 millennia, this route has been

the favored and frequently used corridor for movement of

goods and people between southwest China and the Bay of

Bengal region of South Asia. It is, in fact, a historic invasion

route comparable to a half-dozen other topographically

special corridors around the world.

From 1950 until 1989 Burma balanced carefully

between its two giant neighbors, India and China, being

careful not to get too close to either for fear of antagonizing

the other. Since 1989, however, Myanmar has developed a

close political-military partnership with China. China

became Myanmar’s major supplier of weaponry. It became

involved in training the Myanmar armed forces. It fostered

cordial ties with Myanmar’s military elite, and worked with

that elite to consolidate Yangon’s control over areas of north

and northeast Myanmar previously in rebellion (Rangoon

was renamed Yangon in 1989).14 Large numbers of ethnic

Chinese migrated into northern Myanmar, while the

economy of that region became increasingly oriented toward

China. Myanmar military leaders became partners in

lucrative business arrangements with Chinese partners.

Beijing also offered Myanmar’s rulers cordial political

support while most other countries treated them as pariahs.

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India was unable to halt the development of the new

Sino-Myanmar strategic partnership. It shifted in 1993

from a policy of supporting Myanmar’s opposition

democratic movement to a policy of normal diplomatic

relations with Myanmar’s military junta, but this did not

halt the development of the Sino-Myanmar partnership.

New Delhi watched closely and with dismay as the

Myanmar-China partnership waxed during the 1990s.

From a security perspective, the critical question is

whether Myanmar will become a platform for Chinese

military forces in the Indian Ocean region. During the 1990s

a variety of entities in China, including many

military-related companies, funded the construction or

improvement of roads between Yunnan and Myanmar.

Ambitious moves were also made to construct road, river,

and rail connections between China and the Myanmar

coast. At the same time, Chinese companies became

involved in the improvement of Myanmar harbors, the

modernization of some Myanmar naval facilities and the

construction of other new naval bases. They also

constructed maritime telecommunications and surveillance

facilities on Myanmar’s littoral, including at very sensitive

positions opposite India’s Port Blair in the Andaman

Islands and near the Strait of Malacca. The Chinese

People’s Liberation Army (PLA) clearly had an interest in

the Indian Ocean.

The strategic problem for India was that its superior

military position in the Indian Ocean vis-à-vis China rested

on the geographic advantages it enjoyed in that region.

Viewed in isolation from geographic factors, China’s naval

capabilities were substantially superior to those of India

both in quantity and technological quality. Those Chinese

advantages were more than offset, however, by India’s

geographic advantages.

With deepening Chinese involvement in Myanmar,

India’s traditional geographic advantages in the Indian

Ocean region were increasingly at risk. Given the central

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position of the Indian subcontinent plus India’s island

territories in the Indian Ocean, the Indian Navy enjoyed a

great advantage over Chinese military forces that might

undertake to operate in the Indian Ocean region. Indian

ships operated much closer to logistic bases and land-based

air support. An intense pace of operations was thus within

the capabilities of Indian forces there. Indian forces also

enjoyed far superior air surveillance and attack capabilities

in the IOR. But if China were able to establish logistic

supply points at Myanmar harbors, or to base air or naval

forces from those harbors, it would be able to compete on

more equal terms with the Indian Navy.

China’s objectives in Myanmar were equally defensive.

Setting aside purely economic objectives (which were in fact

substantial), Chinese objectives seem to have been to

gradually strengthen PLA-Navy capabilities in the Indian

Ocean so that China can better defend its interests in the

region against possible Indian encroachment. High among

these interests was the security of the sea lines of

communication carrying China’s very substantial

commerce across the Indian Ocean. In the event of a

Sino-Pakistan war, for example, Chinese assistance could

be delivered to Pakistan via ports in western Pakistan or

eastern Iran (for trans-shipment westward). In either case,

India might be tempted to use its naval forces to interfere

with that Chinese assistance—unless the PLA-Navy had

the clear capability to prevent this. In the event of a

Sino-Indian war, New Delhi might be tempted to interfere

with Chinese commerce across the Indian Ocean—again

unless the PLA-Navy was in a position to prevent this.

More broadly, and from the Chinese perspective, India

has a tendency to throw its weight around in the SA-IOR by

telling the small countries of that region what sort of

relations they may conduct with China. This sort of Indian

hegemony, this interference with China’s normal,

cooperative relations with the sovereign countries of the

SA-IOR, will also be restrained by a stronger PLA-Navy

position in the region.

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It is difficult to foresee the role that Myanmar will play

in future Sino-Indian interactions. Unlike Tibet and

Pakistan, we do not have 5 decades of history to inform us

about those patterns of interaction. Yet it is clear that

Myanmar’s geographic situation makes it highly sensitive,

and that there has been great change in the status of

Myanmar over the past decade. Myanmar would provide

the Chinese with much easier access to the Indian Ocean

than other routes. It would be far superior to either

Pakistan’s highly vulnerable Sino-Pakistani Friendship

Highway or any route that transits the immensely high and

rugged Tibetan plateau. Were China to develop strong

logistic lines between Yunnan and the Bay of Bengal, and

then position naval, air, or ground forces at the southern

ends of those lines, it could swiftly develop very potent

capabilities in the Bay of Bengal.

Myanmar offers a potential “anvil” for a Chinese

“hammer” blow directed at India’s northeast from atop the

Tibetan plateau. Were Beijing to decide to deploy large

ground forces against India, the best way, if not the only

way, for it to get its troops to India would be by way of

Myanmar. It is possible that Myanmar will play a role in

unfolding Sino-Indian rivalry similar to that of Belgium in

the Franco-German rivalry of the 20th century. As the most

convenient corridor for a German move to strike France,

Belgium saw its neutrality violated in 1914 and again in

1940. In the event of an Indian-Chinese war arising out of

Tibet and/or Pakistan, Myanmar would immediately

become extremely sensitive.

CONCLUSION

Any future serious military clash between China and

India is not likely to arise out of a single, specific

conflict—whether over Tibet, the disputed border,

Pakistan, the status of Nepal, Bhutan, and Sikkim, or

Myanmar. War is likely, rather, when conflicts between

Chinese and Indian policy in several of these areas become

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linked. Failure to substantially increase the level of

national response to adverse developments, to cross the

threshold of military conflict, will be perceived as leading to

a major, deleterious shift in the overall structure of power

between China and India with unacceptable implications

for national security. The status of Sikkim or Bhutan might

seem trivial, for example, until the situation in the Chumbi

valley is factored into the equation and that is joined, in

turn, with the magnitude of the Pakistani challenge to

India, which, in turn, will be linked to control over Tibet. It

is the inter-relatedness of the key elements of the

Sino-Indian conflict, the Gestalt of the Sino-Indian

structure of power, which will be critical. Various discrete

elements will be seen as part of a mosaic constituting an

overall structure of power between China and India. If

China and India do decide to resort to war, it will be to

uphold a structure that fundamentally preserves their

security interests.

If and when such an eventuality occurs, both sides will

probably be acting defensively. It will probably not be a

question of either India or China trying to consolidate its

hegemony over the SA-IOR—though the propaganda of

both countries will almost certainly attribute such an

objective to the other. This is not to say, however, that the

outcome of such a Sino-Indian war would not have a

fundamental effect on the future structure of power

between the two countries in the SA-IOR. A decisive victory

for either country could indeed shift the structure of power

fundamentally to the advantage of the victorious country,

regardless of the intentions initially underlying the war.

In contemplating war with China, Indian leaders would

probably be inspired by apprehension that the over-all

structure of power was sliding dangerously and possibly

irreversibly in a direction in which India would be hemmed

in by Chinese positions in the SA-IOR. What would be at

stake, from New Delhi’s perspective, would be India’s

ability to maintain a security environment in SA-IOR

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favorable to India’s long-term national security. India, that

is to say, would be acting defensively.

China, too, would probably be inspired by defensive

concerns. From Beijing’s perspective what would probably

be at stake is the security of Chinese control over Tibet and

the ability of China to protect its westernmost regions

against possible Indian aggression/intervention. Beijing

would also probably be inspired by a desire to develop its

multidimensional cooperation relations with its neighbors

in the SA-IOR along lines agreed to by China and the

governments of the sovereign, neighboring countries.

Indian efforts to stunt or limit the development of those

cooperative relations would be seen by Beijing as aggressive

Indian aspirations of hegemony.

In short, in a future major military conflict between

China and India, both sides would be inspired by defensive

concerns having to do with the inter-relationship of

elements constituting an over-all structure of power

between the two states.

ENDNOTES - CHAPTER 12

1. This discussion of Gestalt theory is drawn from Encyclopedia of

Psychology, Alan E. Kazdin, editor in Chief, Volume 3, American

Psychological Association, New York: Oxford University Press, 2000,

pp. 486-89.

2. The classic explication of this is Morton A. Kaplan, System and

Process in International Politics, Huntington, NY: Krieger, 1975.

3. The author has analyzed these geographic factors at length in his

work on Sino-Indian rivalry. See John W. Garver, Protracted Contest,

Indian-Chinese Rivalry in the 20th Century, Seattle: University of

Washington Press, 2001.

4. This exposition of the security dilemma is drawn from Robert

Jervis, Perception and Misperception in International Politics,

Princeton University Press, 1976, pp. 66-76.

283
5. George Tanham, “Indian Strategic Culture,” Washington

Quarterly, Winter 1992, pp. 129-42. Devin T. Hagerty, “India’s Regional

Security Doctrine,” Asian Survey, April 1991, pp. 351-63.

6. Patel’s views were laid out in a now famous letter to Nehru in

November 1949. The letter is most recently reproduced in L.L.

Mehrotra, India’s Tibet Policy, New Delhi: Tibetan Parliamentary and

Policy Research Centre, 1998, pp. 44-48.

7. For an example of this perspective see Gurmeet Kanwal, “China’s

Long March to World Power Status: Strategic Challenges for India,”

Strategic Analysis, New Delhi, Vol. 22, No. 11 February 1999, pp.

1713-28.

8. See for example, Surjit Mansingh, “China-Bhutan Relations,”

China Report, Vol. 39, No. 2, 1994, pp. 177-79.

9. Zhong Yin bianjing Saiwai fang zuozhan shi (History of China’s

War of Self-Defensive Counter-Attack with India), Beijing: Academy of

Military Sciences, 1994, pp. 37-41. Xu Yan, Zhong Yin bianjie zhi zhan

lishi zhenxiang (True History of the Sino-Indian Border War), Hong

Kong: Cosmos Books, 1993, pp. 27-28.

10. Regarding Chinese policy in Tibet during the 1980s and 1990s,

see Tsering Shakya, The Dragon in the Land of Snows: A History of

Modern Tibet since 1947, London: Pimlico, 1999; Melvyn C. Goldstein,

The Snow Lion and the Dragon; China, Tibet, and the Dalai Lama,

Berkeley: University of California Press, 1997.

11. At least this was the case when I last discussed the Tibetan issue

with Chinese analysts and systematically read Chinese articles on this

topic in early 2000. I do not know whether the Chinese line has changed

since the initiation of the Sino-Indian security dialogue in late 2000.

12. I explore the issue of Nehru’s possible complicity with U.S.

covert operations in Tibet in Protracted Contest, p. 58.

13. On May 26, 1999, India resorted to air strikes to drive out

“freedom fighters” from Pakistan from the heights near Kargil. India

alleged that these “militants” were sponsored by Pakistan, but the

government of Pakistan claimed that it was not involved and that the

heights were occupied by indigenous Kashmiri freedom fighters. Two

Indian aircraft entered the territory of Pakistan, one of which was shot

down. The situation across the line of control became tense. The

Pakistanis, pressured by the international community, persuaded the

militants to vacate the captured territory by July-August, 1999.

284
14. Yangon and Myanmar were renamed by the government in

1989.

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Part V.

SINO-AMERICAN RELATIONS

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CHAPTER 13

BUSH AND CHINA: THINKING

STRATEGICALLY ABOUT UPCOMING

CHOICES

David M. Lampton

INTRODUCTION

The rise of China is clearly one of the more important

trends of recent times. Thinking strategically about how

to manage future relations with this country is clearly

vital. The purpose of this chapter is to offer some

suggestions as to how this may be done. After a brief,

preliminary examination of the strategic context in which

China and the United States find themselves, this

chapter will define the salient issues that preoccupy the

U.S.-China relationship and suggest possibly productive

ways to manage them.

I. THE STRATEGIC CONTEXT

China.

The starting point of the discussion must be a

consideration of the political environment in China and

the United States. This environment obviously has

important implications for U.S.-Chinese relations. Let us

first turn to China. Four points should be stressed.

First, the Chinese currently are engaged in something

of a succession struggle. This may be too strong a word,

but certainly there is a tussle for control as power shifts

from third to fourth generation leaders, a process

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admirably described by Cheng Li in his new book entitled,

China’s Leaders: The New Generation. This domestic

struggle has implications for American foreign policy. First,

it is not quite clear at the moment who the Chinese leaders

of the future will be. Second, Americans are relatively little

acquainted with the fourth generation leaders. Hu Jintao,

Wen Jiabao, and Zeng Qinghong are not well known to

Americans. In fact, Hu Jintao—the person who may occupy

the lead role in the Chinese Communist Party after Jiang

Zemin—has never been to the United States. Americans,

ironically, knew the Third Generation of Chinese leaders

rather better (at the time they ascended to power) than they

do the Fourth Generation. This is because many of the Third

Generation leaders came from Shanghai, and Deng

Xiaoping made an attempt to expose his juniors to the West

in a way that Jiang either hesitates to permit or thinks is

not in his best interest.

Second, the current regime in China is insecure. While it

is an exaggeration to see the ruling elite as hanging on by its

fingernails, it is clear that it faces extensive problems.

Among these are stagnating rural incomes, urban-rural

inequality, unemployment, and corruption. The almost

mono-maniacal efforts the elite has made to suppress the

Falun Gong provides us with an indication of how much

trouble it is having keeping the lid on the society it is trying

to govern.

Third, the Chinese are worried by what they fear may be

a dangerous drift toward independence on the part of

Taiwan. We should be aware that the Chinese see things

rather differently than do Americans. We tend to believe

that President Chen Shui-bian has been remarkably

flexible and even accommodating since he came to power in

Taiwan. From our perspective, he has gone to some lengths

not to alienate Beijing. However, the Chinese look at the big

picture here—they see a problematic trend. Some 20 years

ago, Chiang Ching-kuo spoke of “One China.” Thereafter, at

the end of his presidency, Lee Teng-hui spoke of “The Two

State Theory” [liangguolun]. Today we have Chen

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Shui-bian. He admittedly has somewhat distanced himself

from the Democratic Progressive Party (DPP), but the DPP

still has the independence of Taiwan written into its

charter. This overall drift worries the Chinese almost as

much as any given event of the day.

Fourth, the Chinese leaders are challenged greatly by

the demands of the international community. They are

waking up very rapidly to the implications of world trade in

the era of globalization. They are aware of how the

development of the global economy may affect internal

Chinese affairs and even governance. They have some

genuine concerns. What, for example, are they going to do

about the call for labor unions? How will such calls affect

domestic affairs?

In sum, the China with which Americans must deal is a

China ruled by an elite in transition, which is faced by huge

domestic problems, and worried about external problems

(especially Taiwan). This elite is also troubled by the fact

that the international community is making substantial

demands that Beijing is not sure it either can, or wants to,

meet.

The United States.

The political environment in the United States is also

not entirely conducive to the development of more

productive and better-managed relations with China.

First, a new administration is in place in the United

States. Currently, the new team is still not fully assembled.

Once it has been, it will take some time for its members to

learn the commitments and policies of the last

administration and to get its own bearings, even though

some of the members of the new administration are quite

experienced.

Second, the administration is locked into a

decisionmaking calendar, which may not permit its

members ample time for reflection and dialogue, even if

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they are so inclined. Some decisions are forcing themselves

prematurely onto this half-assembled and not yet fully

briefed team. For example, in March, the United States

intends to introduce a resolution condemning Chinese

human rights behavior when the Geneva Human Rights

Commission meets. The Chinese will not welcome this. In

April, the United States is scheduled to make a decision on

weapons sales to Taiwan. Beijing will be very upset if the

United States transfers to Taiwan some of the classes of

weapons that Taipei wants. Ironically, the Asia Pacific

Economic Council (APEC) summit between U.S. President

George W. Bush and his Chinese counterpart, Jiang Zemin,

is scheduled for late in the year in Shanghai. This means

that the hard decisions are being made before the

opportunity is presented for constructive dialogue between

top leaders of the two nations.

Third, there is no clear consensus in the current U.S.

administration on how to relate to China. The Republican

Party is deeply divided. We need only look at the attitudes of

Brent Scowcroft and Jesse Helms; their views cover the

spectrum of thought about China, and yet they are both in

the same political party. Moreover, the Bush

administration includes a number of very strong foreign

policy personalities, who have firm views on China and who

do not agree with one another.1 Secretary of State Colin

Powell, Secretary of Defense Donald Rumsfeld, Vice

President Richard Cheney (who inevitably will play a very

large role in foreign policy), Assistant to the President for

National Security Affairs Condoleezza Rice, and even

deputies in the State and Defense Departments have

extremely strong personalities and firmly held views on

China and China policy. They also have diverse views on the

U.S.-China relationship.

What of the President? His method of governing

resembles that of a chief executive officer (CEO): he tends to

set broad goals, stand back, and let his staff work things out,

preside over the final decision, and keep things on track

thereafter. So it is not easy to determine what his views on

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China policy substantively may be at this early date. But

during the primaries, several of his Republican primary

contenders did try to make China an issue during public

debates in order to differentiate themselves from George W.

Bush. At these moments, George W. Bush was on the stage

and had to react on his own. The thrust of his argument was,

“China is a big country, it is a sensitive issue, we have many

interests, and China can’t be pushed around.” Although this

position needs to be fleshed out more fully, it is not an

unproductive framework.

Fourth, power is balanced on a knife’s edge on Capitol

Hill. Congress is basically evenly divided, meaning that for

the next 2 years every day is going to be Election Day. One or

two shifts in seats in the U.S. Senate, and much will change.

Because Congress is so evenly divided, it may be very

undisciplined. Unfortunately, many members may find

China an attractive device to assist them in their partisan

struggles.

Fifth, the American economy is showing signs of slowing.

The rising trade deficit with China did not become a major

issue during the Clinton administration, but the new Bush

administration may not be so fortunate. On March 3, 2001,

the front page of the Durham Herald Sun featured a picture

of a woman cleaning out an empty factory. The thrust of the

article was to warn that hard times are here. Clearly, trade

and the trade deficit with China are likely to become more of

an issue in a time of rising unemployment and factory

closings than would be the case in good times.

The context for managing the U.S.-China relationship,

in short, is not optimal in the United States any more than it

is in China.

II. ISSUES AND MANAGEMENT

Thus far we have considered the political and economic

environment which is likely to color our relationship in the

period immediately ahead. At this point we should take

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stock of the major issues that dominate discussion between

the two nations and consider how each, in turn, may be

productively managed.

Before turning to specific points of friction, however, we

should stop for a moment and consider the remarks made by

Admiral Dennis Blair, Commander in Chief of the U.S.

Pacific Command (USCINCPAC), at the Triangle Institute

for Strategic Studies (TISS)/Duke University’s Program in

Asian Security Studies (PASS)/U.S. Army War College

(USAWC) conference on the “Rise of China.” The Admiral’s

overall approach is one that should stand us in good stead as

we think strategically about the future.2

Admiral Blair made two points of special relevance:

First, he spoke of the importance of developing an

“opportunity-based” rather than a “threat-based”

relationship with China. This approach—which seems to be

very much part of the gestalt of not only Admiral Blair, but

also PACOM as a whole—is a very productive one. It does

not mean being oblivious to threats, but it does mean

actively seeking out opportunities.

Second, Admiral Blair reminded us of the enormous size

and diversity of Asia. This is something that we must never

forget. Opinions are not only divided among countries in

Asia, but also within each one of them as well. Take Japan,

for example. Japan gets worried when the United States is

estranged from China. But it gets equally worried when the

United States and China embrace one another too hotly, as

when President Clinton went to China in mid-1998. The

United States is a nation with a comparatively small

population, trying to exert an influence over an enormous

territorial and population base that is extremely diverse

and very sensitive to American actions. As we try to manage

relations, we must keep these basic facts in mind.

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Security Issues.

At this point let us turn to specific areas of friction

between China and the United States. Broadly speaking

these fall into three categories: security, economics-trade,

and human rights.

Security. Security issues are likely to be highest on the

agenda of most Americans and certainly of the new Bush

administration, so we will consider these first.

• At a macro-level, the revolution in military affairs

(RMA) is creating a problem for Beijing. China is now

further behind the United States in military power

than it was in 1990. This is not just the Chinese

perception of reality; American political and military

leaders also accept this.3 Indeed, some serious

military analysts in the United States believe that

China does not have a secure second-strike nuclear

capability. Needless to say, China is reacting to this

comparative decline in military power. It is trying to

modernize its nuclear forces, improve its air force, and

even increase its naval assets, particularly in light of

China’s need to acquiesce to the American show of

force in the Taiwan Strait area in 1996.

The problem is that the minute China begins to react to

what it sees as a widening gap with us by increasing its

military might, its smaller neighbors begin to get worried.

At this point, Washington appropriately worries that

Beijing is seeking to boost the potential costs to America of

intervention on Taiwan’s behalf in the event of a breakdown

of peace in the Taiwan Strait area. China’s problem is how

to keep from falling further and further behind the United

States without alarming Japan, the Philippines, and

Southeast Asia, and without eliciting a dramatic reaction

from Washington.

How can this issue best be handled? While we should not

weaken our alliances with Japan, South Korea, or

Australia, we should develop new, sometimes multilateral,

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relationships, some of which should include China, beyond

the Association of Southeast Asian Nations (ASEAN)

Regional Forum (ARF). We should think about how we

could build a security relationship involving the United

States, Japan, China, and perhaps Russia. The Big Powers

should get together in Asia and hold official talks on a

regular basis. The objective of these meetings should be to

enable the countries to understand each other’s security

problems and develop cooperative methods for working out

difficulties.

• Another security issue, again related to the RMA, is

strategic missile defense. It is understandable that

the United States should want to protect its assets,

troops abroad, and its homeland. Even-handed

analysis, however, should make it clear that missile

defense poses some problems for China. At the

current time, China has some 20 to 24 missiles

capable of hitting the United States. Even a “thin”

national missile defense is probably going to call into

substantial question the capacity of the Chinese to

have an assured second-strike capability. During the

Cold War, at least, we thought that this was essential

to a sense of security.

China is inevitably going to look at what we are doing

rather differently than Russia, which currently has several

thousand warheads. If we proceed with strategic defense,

we must understand that China inevitably will feel more

vulnerable and more threatened—it will do what it has to do

to acquire the capability to have at least a modestly credible

strategic force.

How may we ease concerns over management of

Strategic Missile Defense? One recommendation is that we

think about offensive inventories at the same time as we

think about defensive systems. In a speech at the Citadel,

then-candidate George W. Bush suggested that the United

States begin to build down its offensive missiles and

warhead stockpile, perhaps even unilaterally. This seems to

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be a good idea. While there are debates about how many

warheads constitute enough—1,500, 1,000, 800?—we

certainly do not need the approximately 6,000 warheads

that we currently possess. The Chinese would likely (over

time) become somewhat more amenable to our development

of a national missile defense if we introduced it gradually

and in a cooperative fashion at the same time as we were

reducing offensive inventories. We would need, in other

words, to add the defensive weapons at the same time as we

followed an agreed-upon trajectory for the reduction of

offensive weapons.

• Theater Missile Defense (TMD) would affect China in

a rather different way than strategic, national missile

defense. The Chinese are worried that Americans will

sell such a system to Taiwan. Beijing is not troubled

by the possibility that Taiwan would be so well

protected that it rationally could act without fear of

PRC retaliation. Rather, China fears that

Washington would then feel obligated to integrate

Taiwan into its command and control and intelligence

systems in a way that looks a great deal like an

alliance. One of the preconditions for “normalization”

of diplomatic relations in 1978-79 was that the United

States would end its military alliance with Taipei.

Regarding management, as long as China continues to

build up its own short-range missiles in Fujian Province, it

is going to be impossible to get Americans to agree to

abandon the idea of providing Taiwan with anti-missile

systems. Indeed, America already has provided low-altitude

Patriot systems to the island. Nonetheless, there are some

interesting approaches we might take to make this less

explosive. For example, we might agree with Beijing

(presumably with Taipei’s tacit concurrence) that we would

not transfer high-altitude missile defense systems to

Taiwan if the Chinese showed restraint on their deployment

of missiles directed against Taiwan. Alternatively, we

might, for example, think about developing a missile

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defense system that can be kept on U.S. naval platforms.

These would remain under U.S. control and move around in

the region during a crisis. In other words, the United States

would not provide the military capability to Taiwan, but

instead would provide a mobile regional defense. Of course,

there might be technical and practical difficulties that stand

in the way of such a system. Whatever we do, however, we

ought to take the concerns of the Chinese seriously.

• The “Taiwan question” is one of the most sensitive of

all issues. The nature of the problem has already been

alluded to. It is linked to the macro-military problem,

for much of China’s military modernization is aimed

at deterring Taiwan from drifting toward

independence.

Management of the Taiwan problem is a challenge in

double deterrence. We need to deter the People’s Republic of

China (PRC) from using force. Few American audiences

would disagree with this. But, at the same time, we also

need to deter Taiwan from taking actions that are

“provocative” and that might drag America into actions not

in our best interest, or Taiwan’s for that matter. The

problem is, of course, defining what constitutes provocative

behavior, or for that matter, “America’s interests.” If you

use the word “provocation,” and if a Taiwanese official is in

the audience, he/she will say: “What’s provocative? Is our

leader transiting your country provocative? Is our leader

going to Cornell University provocative? What’s

provocative?” However, while it is undoubtedly true that, to

some degree, provocation is in the eye of the beholder, one

can say of provocation what the Supreme Court said of

pornography, “I don’t know how to define it but I know it

when I see it.”

Steps to reverse the militarization of the Taiwan Strait

would also be useful. The PRC has been conducting

exercises and has been increasing the number of

short-range missiles and other assets in the area since

1995-96. If the Chinese show no restraint in this matter, the

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Washington policymaking and security establishments are

less likely to be restrained in the kind of weapons they sell to

Taiwan. We need to somehow develop mutual restraints in

weapon sales and deployment in the area of the Taiwan

Strait.

Cross-Strait economic cooperation should be

encouraged. In his New Year’s message, President Chen

Shui-bian of Taiwan used a very interesting set of

words—"political integration." The PRC did not seize upon

this concept, but it seems to me to be a useful idea and might

provide a framework for dialogue between Taiwan and

China in the political realm. The United States should

acknowledge that this phrase was used and promote its use

with Beijing. In the meantime, while political dialogue is

likely to remain moribund across the Strait for the

immediate future, economic cooperation should be actively

encouraged.

Trade Issues.

Trade is a second major issue/concern. A newspaper

article (March 2, 2001) by Nicholas R. Lardy provides the

final figures on the Year 2000 trade deficit between the

United States and China. The figure was about $84 billion.

This means that last year was the first year in which the

American trade deficit with China was bigger than its

deficit with Japan. We have now crossed a Rubicon, and we

have done so precisely at a time when the U.S. economy is

slowing and when political relations are not fully stable.

The confluence of these trends is not helpful.

• Managing Trade. What can be done about this? Will

WTO provide some solution to this particular

problem? Probably not, for several reasons, though

PRC entry is critical to the larger goal of China’s

integration into the world community. First, it seems

unlikely that China will be able to join the World

Trade Organization (WTO) before June 2001, at the

earliest. (Perhaps one should say that China will not

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be willing to make the necessary concessions that

would enable it to join in the next few months). So

politicians on Capitol Hill are getting reconciled to the

idea that there will be another debate over the annual

renewal of Normal Trade Relations (NTR).

Second, it will not solve the deficit problem. WTO was

“sold” domestically as something that would provide

Americans a level playing field and enable the United

States to export more to the PRC, and it will. However, it

also will probably soon dawn on Americans that WTO and

market access will probably not, at least in the short term,

reduce the U.S. trade deficit with China. In fact, the deficit

with China will probably continue to rise. This is not

entirely due to Chinese perfidy, although there may be some

of that as well. First of all, China’s real tariff level is rather

low now. The effective current tariff rate is actually in the

3-4 percent range. In other words, China is not keeping

American goods out of China principally by using tariffs.

This means that significant Chinese adjustment to WTO

rules (particularly those applying to tariffs) already has

occurred and future changes in this respect will bring about

fewer relative gains, though much more needs to be done.

And finally China is not going to be subject to quotas on

apparel after 2004, and it is very competitive in this area.

The fact is that when it comes to the goods that we are

importing, China has the comparative advantage. Its

production costs are low—so low that production is being

relocated from all over Asia into the PRC. This production is

not just in traditional labor intensive industries, but

high-technology fields as well. The PRC also is benefiting

from extensive foreign direct investment, in part because

foreign investors are eager to gain access to Chinese

markets. American workers really do not want to compete

with Chinese workers on the battlefield of absolute wages.

So all we can do is try to upgrade our own work force,

increase productivity, and stay on the cutting edge of high

value-added products. Beyond this, there is not much we

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can do to deal with this problem in the short and medium

runs. If these products were not being imported from China,

they would come from other low-cost producers outside the

United States, as we see in the case of textiles from Mexico.

For the most part, these jobs have left the United States for

good. The only question is which developing country gets the

jobs?

Human Rights.

The third point of friction is over human rights. Concern

over the Chinese record in this area has been a continual

feature of our relations with China for over a decade.

Human rights problems in China are undeniably ongoing

and serious, affecting both individuals and groups. This

troubles Americans. They expect—and will continue to

expect—their political leadership to express its

dissatisfactions to the Chinese. We may, therefore, predict

that continuing pressure will be put on the Chinese in

international forums to improve in this area.

• Managing Human Rights. In the view of this author,

those who are involved in this process recognize that it

is largely a symbolic undertaking in the short run. Not

too many people believe that outside pressure will

bring about greater respect for human rights in China

any time soon. Nonetheless, it is important for us to

condemn ongoing and serious abuses, and we will no

doubt continue to do so. But if we are really interested

in human rights, we should spend more time focusing

on long-term institutional and developmental issues

in China. There are a variety of constructive things we

could do. We might, for example, help the Chinese in

their effort to build a legal system, a judicial system,

and a rule of law system. Capitol Hill has, in general,

been a lot more willing to talk about human rights

than to appropriate money to do those things that

might, over the long run, prove more effective than

passionate rhetoric.4

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CONCLUSION

In sum, it is clear that we have a very difficult agenda

ahead of us. The issues that are presenting themselves early

in the Bush administration are among the most difficult.

They are in the security and human rights areas. The

context for dealing with these productively is not

auspicious, though neither is it futile. This is true whether

we are looking at the Chinese or the American environment.

When we speak of Chinese-American relations, we are not

talking of problems and their solutions, but rather of

problems and their management. Dealing with China in the

future is thus likely to be leadership-attention intensive,

protracted, and frustrating. Regrettably, in all likelihood, 5

years from now we will be looking at a very similar picture,

speaking of the same broad issues, and facing a similar

structure of choices.

ENDNOTES - CHAPTER 13

1. The reverse was true in the early Clinton administration, where

the problem was a dearth of strong foreign policy personalities

(Secretary of State Warren Christopher, National Security Advisor

Anthony Lake, and even the President himself were not strong).

2. These remarks were made in response to the address given by

Admiral Blair at the evening banquet.

3. During the last decade, this author had the good fortune to visit

China with three former secretaries of defense and about 10 or 11

four-star military officers (retired). In his estimate, they would

subscribe to this view.

4. The administration in which Susan Shirk served did, however,

get some money appropriated for rule of law programs.

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ABOUT THE CONTRIBUTORS

BRETT V. BENSON is a doctoral candidate at Duke

University. His research interests center on the evolution of

political institutions and trade and security. Currently, Mr.

Benson is working on understanding how the trade

relationship between China and Taiwan impacts the

security situation in the Taiwan Strait.

KURT CAMPBELL is Senior Vice President and Director of

the International Security Program at the Center for

Strategic and International Studies (CSIS). He came to

CSIS after serving in the Department of Defense as Deputy

Assistant Secretary of Defense. Prior to this, Dr. Campbell

served as Deputy Special Counselor to the President for the

North American Free Trade Agreement (NAFTA) at the

White House, a member of the National Security Council

staff, a White House fellow, and officer in the U.S. Navy. He

has also been Associate Professor of Public Policy at the

John F. Kennedy School of Government and Assistant

Director of the Center for Science and International Affairs

at Harvard University. Dr. Campbell has written widely on

world affairs, and his publications include two books. He

received his Ph.D. from Oxford University.

MICHAEL R. CHAMBERS is Assistant Professor of

Political Science at Indiana State University. His areas of

specialization are international relations, Chinese foreign

policy, the international politics of East Asia, and

comparative politics. His dissertation is entitled

“Explaining China’s Alliances: Balancing Against Regional

and Superpower Threats.” His publications include

“Making and Keeping the Peace: Cambodia,” in A Global

Agenda: Issues Before the 47th General Assembly of the

United Nations, John Tessitore and Susan Woolfson, eds.

He received his Ph.D. from Columbia University.

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SUMIT GANGULY is Professor of Asian Studies at the

University of Texas at Austin, where he teaches courses on,

among other subjects, ethnicity and nationalism,

international security, and politics in South Asia. He has

been a Fellow at the Woodrow Wilson International Center

for Scholars and the Center for International Security and

Cooperation at Stanford University. has published

numerous articles in professional journals and has

commented on South Asian politics for broadcast news

outlets. He is the author of The Crisis in Kashmir and The

Origins of War in South Asia, and has co-edited a number of

books. Dr. Ganguly received his Ph.D. from the University

of Illinois at Urbana-Champaign.

JOHN W. GARVER is Senior Research Fellow and Director

of the Asia Program at the Center for International

Strategy, Technology and Policy at the Georgia Institute of

Technology and a Professor in the Sam Nunn School of

International Affairs. His current research interests are in

Chinese-Russian Relations and Chinese-Indian Relations.

He was a resident of China for 6 years and is a member of the

National Committee on U.S.-China Relations. Dr. Garver is

the author of three books: Face Off: China, the United

States, and Taiwan’s Democratization; The Sino-American

Alliance: Nationalist China and American Cold War

Strategy in Asia; and In the Eyes of the Dragon: China Views

the World (edited with Yong Deng), as well as 40 articles

dealing with China’s foreign relations. He received his

Ph.D. from the University of Colorado.

JOSEPH GRIECO is Professor of Political Science at Duke

University. He specializes in theories of international

relations and problems of international political economy.

Dr. Grieco is the author of Cooperation Among Nations:

Europe, America, and Non-Tariff Barriers to Trade and

Between Dependency and Autonomy: India’s Experience

with the International Computer Industry. Articles and

notes by him have appeared in a variety of professional

journals. Prior to coming to Duke, Dr. Grieco served with

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the Office of the United States Trade Representative, the

International Monetary Fund, and was an International

Affairs Fellow of the Council on Foreign Relations. He

received his Ph.D. from Cornell University.

DAVID LAMPTON is George and Saydie Hyman Professor

and Director of China Studies at the Johns Hopkins School

of Advanced International Studies and Director of China

Studies at the Nixon Center. Prior to this, he served for 10

years as President of the National Committee on

U.S.-China Relations in New York City. He has also been

Director of the China Policy Program at the American

Enterprise Institute in Washington, DC, and Associate

Professor of political science at Ohio State University. Dr.

Lampton has lived in the PRC, Taiwan, and Hong Kong. He

is the author, among other works, of Same Bed, Different

Dreams: Managing United States-China Relations

1989-2000. Dr. Lampton received his Ph.D. from Stanford

University and has an honorary doctorate from the Russian

Academy of Sciences’ Institute of Far East Studies.

EMERSON M. S. NIOU is Director of Duke University’s

Program in Asian Security Studies and the Center for

Chinese Electoral Studies and is Associate Professor of

Political Science. He specializes in formal theory,

international relations, political economy, and East Asian

politics. Dr. Niou is the co-author of The Balance of Power

and of numerous articles in professional journals. His

recent publications in the field of East Asian politics include

“Seat Bonuses under the Single Non-Transferable Vote for

Large Parties: Evidence from Japan and Taiwan,” with G.

Cox, Comparative Politics, January 1994. Dr. Niou’s

current projects include studies of village elections in rural

China and alliance politics in anarchic international

systems. Brett Benson, his co-author, is a doctoral

candidate at Duke University. His research interests center

on the evolution of political institutions and trade and

security. Currently, he is working on understanding how

the trade relationship between China and Taiwan impacts

304
the security situation in the Taiwan Strait. Dr. Niou

received his Ph.D. from the University of Texas at Austin.

CAROLYN PUMPHREY is Program Coordinator For the

Triangle Institute for Security Studies (TISS), Duke

University’s Program in Asian Security Studies (PASS),

and Visiting Assistant Professor of History at North

Carolina State University. She has taught a wide variety of

courses at the college level, including “War and Society in

Ancient and Medieval Times,” and the “History of

Restraints on War.” Dr. Pumphrey’s research interests are

in the history of restraints on war, with a special focus on

the European Middle Ages. She was the Post-Doctoral

Fellow for the Triangle Institute for Security Studies

between 1997 and 2000. Dr. Pumphrey is the editor of

Transnational Threats: Blending Law Enforcement and

Military Strategies. She received her Ph.D. from Duke

University.

DAVID ROSENBERG is Professor of Political Science at

Middlebury College. His research interests include

development, environment and security issues of the South

China Sea, international environmental negotiations, and

environment and development in Southeast Asia. Besides

contributing numerous articles to professional journals, Dr.

Rosenberg has edited and co-authored numerous books. He

is the author of Economic Growth and Social Equity in

Developing Countries and the editor of the South China Sea

World Wide Web Virtual Library. (http://www.

middlebury.edu/SouthChinaSea/). Dr. Rosenberg’s most

recent publications are “Environmental Pollution around

the South China Sea: Developing A Regional Response to a

Regional Problem,” Resource Management in Asia-Pacific

Working Paper Series; and “ASEAN’s Response to

Environmental Pollution around the South China Sea,”

Journal of Contemporary Southeast Asia, April 1999. He

received his Ph.D. from Cornell University.

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ANDREW SCOBELL is Research Professor of National

Security Affairs at the Strategic Studies Institute (SSI) of

the U.S. Army War College. Born and raised in Hong Kong,

Dr. Scobell taught at the University of Louisville and

Rutgers University before joining SSI in August 1999. He is

a specialist on Asian political and military affairs,

especially China and Northeast Asia. Dr. Scobell is

concerned with democratization; comparative communism

and post-communism; civil-military relations; and strategic

culture. He has published articles in a variety of

professional journals. His recent focus has been on

China-Taiwan relations, the Korean War, and paramilitary

formations. Dr. Scobell received his Ph.D. from Columbia

University.

SUSAN SHIRK is Professor of International Relations at

the University of California at San Diego and Research

Director at the University’s system-wide Institute on Global

Conflict and Cooperation. From July 1997 to July 2000 she

served as Deputy Assistant Secretary of State in the Bureau

of East Asia and Pacific Affairs, with responsibility for the

People’s Republic of China, Taiwan, Hong Kong, and

Mongolia. Dr. Shirk’s publications include two edited works

and her books, How China Opened Its Door: The Political

Success of the PRC’s Foreign Trade and Investment

Reforms; The Political Logic of Economic Reform in China;

and Competitive Comrades: Career Incentives and Student

Strategies in China. She received her Ph.D from the

Massachusetts Institute of Technology.

TSUNEO WATANABE is a Visiting Scholar at the Center

for Strategic and International Studies (CSIS). He joined

the Japan Chair in February 1995. He is currently on leave

from the office of Congressman Kozo Watanabe (vice

speaker of Japan’s House of Representatives and former

Minister of International Trade and Industry). He provides

analysis on Japanese domestic politics in a rapidly changing

Japan and their policy implications. Dr. Watanabe also

focuses on civil-military relations in Japan. His related

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works include “Prevent Tyranny of Pneuma by Improving

Civil-Military Relations” in Big Bang in Security: Anthology

of Yomiuri’s Essay Award for the Rookie of the Year, Yomiuri

Shimbun, 1998. Dr. Watanabe received his M.A. from the

New School for Social Research in New York and his D.D.S.

from Tohoku University, Japan.

BIN YU is Associate Professor in the Political Science

Department of Wittenberg University, Ohio, and Faculty

Associate of the Mershon Center at Ohio State University.

Dr. Yu is regularly consulted by, and contributes to,

English- and Chinese-language media outlets, and ChinaHong Kong- and Taiwan-based newspapers and periodicals.

He is the author of numerous articles and The Northeastern

Pacific Quadrangle Fifty Years After: Balance of Power and

Back to the Future; Dynamics and Dilemma: Mainland,

Taiwan and Hong Kong Relations in A Changing World;

and Taiwan in Transition: Observations and Reflections. A

co-authored book entitled Mao’s Generals Remember Korea

is forthcoming in 2001. Dr. Yu received his M.A. from the

Chinese Academy of Social Sciences and his Ph.D. from

Stanford University.

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U.S. ARMY WAR COLLEGE

Major General Robert R. Ivany

Commandant

*****

STRATEGIC STUDIES INSTITUTE

Director

Professor Douglas C. Lovelace, Jr.

Director of Research

Dr. Steven Metz

Editor

Dr. Carolyn Pumphrey

Director of Publications

Ms. Marianne P. Cowling

Publications Assistant

Ms. Rita A. Rummel

*****

Composition

Ms. Kimberly A. Rockwell