Beijing’s Strategy to Counter U.S. Influence in Asia

Publication: China Brief Volume: 5 Issue: 25

After months of frenetic diplomatic forays—which have included trips made by President Hu Jintao and other top cadres to places as far away as Africa and Latin America—Beijing’s top leaders are at year-end giving top priority to cementing ties with the Middle Kingdom’s immediate neighbors. Marathon meetings to open soon in the Malaysian capital of Kuala Lumpur will see China staking out a claim to be the predominant power in Asia within the coming decade. This will have awesome implications for the U.S. and Japan, which seem reluctant to see the PRC’s further aggrandizement in the Asia-Pacific region.

Kuala Lumpur is playing host next week to three conferences crucial for Beijing’s ambitious gameplan for Asia: the 9th annual meeting among leaders of China and the 10 members of the Association of Southeast Asian Nations (ASEAN); the 9th ASEAN plus three (China, Japan, and South Korean) conclave; and the inaugural East Asian Summit, which is set to morph into an East Asian Community (EAC). Premier Wen Jiabao, who is visiting Europe this week, will lead a large delegation to Malaysia. Of the three events in Kuala Lumpur, the EAC—dubbed Asia’s answer to the European Community—has attracted the most attention. The embryonic outfit will group together the “ASEAN plus three” nations, in addition to Australia, New Zealand, and India. Part of the diplomatic and academic communities’ interest in the East Asian Summit arises out of Washington’s thinly veiled animosity toward the EAC concept: while being a long-time Pacific power, the U.S. has not been offered membership in the Community.

The structure and mission of the EAC—which will be determined at its inauguration—is also set to worsen the quasi-Cold War atmosphere that has characterized China-Japan relations the past year. While Beijing is leaning toward the idea of the “ASEAN plus three” countries forming the “core” of EAC, Tokyo is predisposed toward encouraging the two other regional influences—Australia and India— to play as substantial a role as the other powers. The Chinese leadership under President Hu, who heads the policy-setting Leading Group on Foreign Affairs within the Chinese Communist Party (CCP), is said to be thoroughly upset at Tokyo’s not-so-subtle bid to prevent the PRC from dominating the EAC.

At first sight, China, though fast rising, seems hardly within striking distance of matching America’s influence in the region. Take for instance the amount of foreign direct investment (FDI): Chinese corporations’ cumulative capital outlay in Southeast Asia amounted to little over USD $1 billion by the end of last year, compared to more than USD $85 billion from U.S. companies (Straits Times, November 28). Yet Beijing has dramatically expanded its clout particularly among ASEAN members. In Kuala Lumpur, Premier Wen and his ASEAN counterparts will be putting the finishing touches on the ambitious China-ASEAN free trade area. When fully operational in 2010, the superzone will cover 1.8 billion people, an aggregate GDP of USD $2 trillion, and a trade volume totaling USD $1.23 trillion (China News Service, November 29). Tariffs for some 7,000 products would be lowered to 5 percent or lower by 2010. ASEAN is currently enjoying around a USD $20 billion trade surplus with China. Moreover, quite a few of the poorer ASEAN countries such as Laos, Cambodia, and Myanmar have become virtual Chinese client states as a result of generous economic aid.

Even more noteworthy has been Beijing’s ability to quickly improve geopolitical, security, and military links with individual ASEAN members. This is despite the fact that Washington has privately urged ASEAN nations to steer clear of such ties with the PRC. For example, territorial disputes over the Spratly Islands, a perennial bone of contention between China and Southeast Asian states, have been partially solved due to China’s initiatives. Beijing has worked out separate agreements with Manila and Hanoi for the joint exploration of oil and gas in contested areas of the South China Sea. Until recently, it had been an ASEAN consensus that the Spratly issue be negotiated between China on the one hand, and the entire regional bloc on the other. Equally significant, the People’s Liberation Army has conducted joint military maneuvers with individual ASEAN nations. Beijing is also selling weapons of various degrees of sophistication to countries including Malaysia and Indonesia. Particularly alarmed by the inroad that Beijing has made with Indonesia, Washington last month decided to lift a six-year-old embargo on arms sales to the populous Muslim country. Diplomatic analysts have indicated, however, that Washington’s obsession with the global war on terrorism since 9/11 has provided an auspicious opportunity for Beijing to wade into a power vacuum in the Asia-Pacific region.

Throwing late patriarch Deng Xiaoping’s diplomatic dictum of “never taking the lead” to the wind, the aggressive Hu-Wen team has succeeded in persuading a growing number of Asian countries to declare some form of “neutrality” in the event of a military conflict between China and the U.S. over issues such as the Taiwan Strait. So far, Australia and Singapore have openly professed such neutrality; countries that are believed to have made private pledges to the same effect include Malaysia, the Philippines, and South Korea. Beijing’s apparent success in driving a kind of wedge between the U.S. and several of its Asian allies has considerably weakened Washington’s ability to wage what the CCP leadership has characterized as an “anti-China containment policy.”

Apart from efforts to undermine U.S. influence in Asia—and to counter Washington’s alleged anti-China encirclement conspiracy—the Hu-Wen team is also hoping to achieve other important foreign-policy goals in Kuala Lumpur. These include further isolating Taiwan and undercutting Japan’s influence in the region. Particularly after the defeat suffered by the pro-independence government of President Chen Shui-bian in the December 3 mayoral and county-level polls in Taiwan, Beijing is confident that it can further squeeze the “diplomatic breathing space” of the breakaway province.

While no Asian country has kept diplomatic ties with Taiwan, the rich island has retained substantial influence in countries such as Vietnam, Malaysia, Singapore, Indonesia, and the Philippines, owing to factors that include FDI and a long history of people-to-people relations. Should Beijing’s clout in ASEAN and the new EAC continue to grow, however, the CCP leadership may be in a position to play the “Asia card” against the Taipei leadership. For example, if Taipei continues to snub Beijing’s demand for an open recognition of the “one China principle,” the Chinese leadership could put pressure on Asian capitals to “choose between China and Taiwan,” which is to say drastically scale down economic ties with Taiwan.

Last Sunday, Beijing suddenly announced that the 7th annual meeting of the three heads of government of China, Japan, and South Korea—originally also scheduled for Kuala Lumpur—would be cancelled “owing to [unfavorable] climate and conditions.” Beijing’s agenda cannot be clearer. It wants to further play up the perception in South Korea and several other Asian countries that the administration of Prime Minister Junichiro Koizumi is reviving right-wing if not quasi-militaristic politics. In the wake of Koizumi’s fifth visit to the controversial Yasukuni Shrine last October, both Beijing and Seoul have decided to freeze top-level meetings with Japan’s leaders. During last month’s meeting of the Asia-Pacific Economic Cooperation in South Korea, Chinese media commentators gloated over how Koizumi had become a pariah among Asian leaders. In private discussions with ASEAN leaders, Premier Wen is expected to lay emphasis on the dangers of Japan’s alleged program of re-militarization.

In platforms such as the China-ASEAN dialogue and the EAC, Beijing is expected to play the part of a “benevolent elephant” that bestows development aid and trade surpluses on its neighbors. Individual ASEAN officials have even praised such gallantry: taking from the rich (reaping huge trade surpluses with the U.S. and the EU) while dispensing the excesses to its neighbors. The picture, however, is never this simple. More Asian countries are feeling the heat of a rising China that is cynically using its newfound wealth—including foreign-exchange holdings of more than USD $800 billion—and military prowess to foster a Chinese version of the Monroe Doctrine. After all, China’s economic aid and arms sales at “brotherhood prices” come with strings attached. For instance, the recipients of Chinese largesse are expected to toe Beijing’s line about constructing a multi-polar world order, or one shorn of the “unilateralism” of the world’s sole superpower.

One of Premier Wen’s most important agendas at Kuala Lumpur, particularly in relation to the birth of the EAC, is to play up the symbiotic benefits that China’s neighbors stand to enjoy by close relations with Beijing. Wen will also be putting the best spin on the negative aspects of dealing with the PRC, which include the influx of cheap Chinese consumer products as well as agricultural produce in countries such as Malaysia and Thailand. Most importantly, Washington seems finally to have understood the potent threat that Beijing is posing to U.S. influence in the Asia-Pacific. Countries ranging from Australia to India—which has recently displayed pro-U.S. sentiments largely due to Washington’s mid-year decision to sell New Delhi sophisticated military technology—have already made it clear that they will not let Beijing dominate the EAC. At this stage, of course, the EAC is still a murky concept and considered much more of an upbeat slogan than a vision that is predicated upon solid political partnerships. That so much attention has been bestowed upon the Community, however, has thrown into sharp relief the escalating tension—and cut-throat competition—between a status quo superpower and a fast-rising would-be superpower.