March 30, 2004
China’s Emerging Role in the Multilateral System
A presentation delivered at the University of Victoria
1.
U. VICTORIA PRESENTATION
China’s emerging role in the multilateral system
- 1793: MISSION OF LORD GEORGE MACARTNEY TO THE QTNG
EMPEROR QIAN LONG; QIAN LONG WROTE A NOTE TO MACARTNEY
SA YING OF CHINA THAT ‘WE POSSESS ALL THINGS. I SET NOV ALUE
ON OBJECTS STRANGE AND INGENIOUS, AND HA VE NO USE FOR
YOUR COUNTRY’S MANUFACTURES’; - 2001: CHINA FORMALLY JOINS THE WORLD TRADE ORGANIZATION,
IN A YEAR WHEN ITS TOT AL TRADE WAS: ; THE WTO AS THE
WORLD’S MOST RULES’ BASED ORGANIZATION;
2.
EV AN MEDEIROS AND TAYLOR FRAVEL; CHINA’S NEW DIPLOMACY,
FOREIGN AFFAIRS DECEMBER 03: CHINA ‘NOW LARGELY WORKS
WITHIN THE INTERNATIONAL SYSTEM. IT HAS EMBRACED MUCY OF
THE CURRENT CONSTELLATION OF INTERNATIONAL INSTITUTIONS,
RULES AND NORMS AS A MEANS TO PROMOTE ITS NATIONAL
INTERESTS’.
THUS, IT TOOK OVER 200 YEARS FOR CHINA TO COMPLETELY
REVERSE IT’S APPROACH TO THE WORLD.
3.
TWO QUESTIONS: I. WHAT KEY CHARACTERISTICS OF TODA Y’S
CHINA DEFINES IT’S EMERGING ROLE IN THE INTERNATIONAL AND
MULTILATERAL SYSTEMS? 2. WHAT ARE THE POLICY
CONSEQUENCES OF THESE CHARACTERISTICS?
OTHER QUESTIONS ALSO Itv1POSE THEMSELVES: WHAT WILL THE
MULTILATERAL ORGANIZATlONS SEEK OF CHINA IN THE PURSUIT OF
THEIR ATIONAL INTERESTS? WHAT WILL BE CHINA’S IMPACT, OVER
TIME, ON THE PRINCIPAL MULTILATERAL INSTITUTIONS AND WHAT
CAN THE MEMBERS OF THESE INSTITUTIONS DO TO OBTAIN A
SYSTEMICALLY POSITIVE AND STRENGTHENING OUTCOME?
4.
THE DRIVERS OF CHTNA’S INTERNATIONAL ROLES CAN BE
UNDERSTOOD AS: TWO STRENGTHS AND FOUR WEAKNESSES. TN
CHINESE, WE MIGHT CALL THESE ‘LIANGJIANG, SILUO’.
TELLINGLY, CHINA ITSELF BELIEVES THAT POWER MUST BE
“COMPREHENSIVE”, IF IT IS GOING TO SHAPE GEOPOLITICAL
REALITIES AND INTERNATIONAL INSTITUTIONS TO MEET ITS ENDS.
CHINA HAS, HISTORICALLY, UNDER SO-CALLED “SCIENTIFIC
SOCIALIS.M”, ANALYSED THE COMPONENTS OF NATIONAL POWER
UNDER THE RUBRIC OF “COMPREHENSIVE NATIONAL POWER”.
THERE IS AN ACTUAL ALGORITHM TO CALCULATE THIS. IT IS USED
TO DETERMINE WHERE CHlNA IS VIS-A-VIS OTHER COUNTRIES.
COMPREHENSIVE NATIONAL POWER CONSISTS OF: - MATERIAL OR HARD POWER (NATURAL RESOURCES,
ECONOMICS, SCIENTIFIC AND TECHNOLOGY, AND MILITARY
POWER); - SPIRIT OR SOFT POWER (POLITICS, FOREIGN AFFAIRS, CULTURE
AND EDUCATION); - CO-ORDINATED POWER (LEADERSHIP ORGANISATION,
COMMAND, MANAGEMENT, AND CO-ORDINATION OF NATIONAL
DEVELOPMENT); - ENVIRONMENTAL POWER (INTERNATIONAL, NATURAL AND
DOMESTIC).
CLEARLY, CHINA DOES NOT YET POSSESS, NOR CONSIDER THAT IT
POSSESSES THE COMPREHENSIVE POWER THAT IS ITS STATED
OBJECTIVE. IT IS CHARACTERIZED BY A MIX OF STRENGTHS AND
WEAKNESSES.
CHINA’S STRENGTHS
- ECONOMIC GROWTH
WE WOULD NOT BE GIVING CHINA THE ATTENTION THAT TT IS
GETTING WERE IT NOT FOR ITS IMMENSE (EARTH-SHAKING, REALLY)
ECONOMIC GROWTH AND TRANSFORMATlON. IT IS NOT ONLY THAT
THE 2003 NUMBERS ARE IMPRESSIVE, IT IS THAT THEY REFLECT
GROWTH RA TES THAT HA VE BEEN IN PLACE FOR A GENERATION.
SINCE 1979, OVERALL GDP GROWTH HAS AVERAGED 9. 4%. LAST
YEAR IT WAS 9. 1%. AT $1.4T, CHINA IS NOW THE WORLD’S 6 Tti
LARGEST ECONOMY. GROWTH IS LEAD BY DOMESTIC AND FOREIGN
INVESTMENT. WITH 40% IN GROSS SAVINGS, FIXED CAPITAL
FORMATION INCREASED BY 26. 7% LAST YEAR. FDI REACHED ITS
VITESSE DE CROISIERE IN 1993 WHEN ANNUAL FLOWS SURPASSED
$30B, AND IN 1995 WHEN STOCK REACHED $100B. LAST YEAR, $53B
IN FDI ENTERED CHINA, FOR A TOTAL STOCK ESTIMATED AT $503B.
(TO COMPARE, CANADA HAS ATTRACTED AN AVERAGE OF USD $33
BILLION/PER YEAR TN FDI OVER THE LAST 5 YEARS. )
THE RESULTING FOREIGN INVESTED ENTERPRISES ACCOUNT FOR
OVER HALF OF CHINA’S EXPORTS AND IMPORTS. EXPORTS ROSE
35% IN 2003, TO $438B, IMPORTS GREW 40%, TO $413B. CHINA IS NOW
THE WORLD’S 4TH LARGEST TRADING NATION. US TRADE
DEPENDENCE ON CHINA ROSE FROM 3% A DECADE AGO, TO 11 %
LAST YEAR; JAPAN HAS GONE FROM 2% TO 8%. IT HAS BECOME THE
SECOND IMPORTER OF OIL, AFTER THE UNITED ST ATES, AND THE
LARGEST IMPORTER OF IRON ORE, COPPER, FERTILIZER, NICKEL AND
COPPER.
CHINESE PER CAPITA GDP DOUBLED IN THE FIRST TEN YEARS OF
REFORM (’78 TO ’87), AND THEN TOOK ONLY 9 YEARS TO DOUBLE
AGAIN (’87 TO ’96). IN 1978, PRIMARY INDUSTRY ACCOUNTED FOR
28% OF GDP, AND THE TERTIARY, SERVICES SECTOR WAS 24%.
TODAY, THE SITUATION IS REVERSED, WITH PRIMARY AT 15% AND
SERVICES AT ONE THIRD OF THE ECONOMY. MANUFACTURING HAS
HELD ITS PLACE AT ABOUT HALF OF ECONOMIC OUTPUT.
NOT INCLUDING, HONG KONG’S FOREIGN EXCHANGE RESERVES (USD
$118 BILLION), CHINA’S OWN FX HOLDINGS ARE NOW $403 BILLION
(A $100 BILLION DOLLAR INCREASE TN 2003), THE SECOND HlGI-.lEST IN
THE WORLD, BEHIND JAPAN ($741 BILLION). CHINA MAY HA VE
PURCHASED AS MUCH AS $75 BILLION IN US GOVERNMENT BONDS
LAST YEAR.
ETCETERA.
THE CHINESE CO:M11UNIST PARTY AND ITS PRINCIPAL EXECUTING
AGENCY, THE CHINESE GOVERNMENT, HA VE MADE ECONOMIC
DEVELOPMENT ITS PRIMARY OBJECTIVE. “YI JINGJJ JJANSHE WEI
ZHONGXIN”, AS THE SPEECHES AND PROPAGANDA PUT IT:
ECONOMIC DEVELOPMENT AS THE CORE OBJECTIVE. THE NUMBERS
TELL ONLY PART OF THE STORY. A LOOK AT THE UNDERLYING
POLICIES OVER THE LAST 25 YEARS SHOWS THAT, WHILE ERRORS
HA VE BEEN MADE, HUGE DIFFICULTIES HA VE ALSO BEEN
SURMOUNTED. THE TRACK RECORD IS THERE FOR ALL TO SEE, VIZ.
THE SKYLINES OF SHANGHAI, GUANGZHOU, BEIJING, DALIAN,
WENZHOU, HANZHOU, CHONGQING, SUZHOU, ET J’EN PASSE. AS
LONG AS ONE DOESN’T LOOK TOO CLOSELY BEHIND THE
ACHIEVEMENTS – AND MOST PEOPLE OUTSIDE CHINA DON’T – THE
NUMBERS SPEAK FOR THEMSELVES. WE’LL COME TO THE STORY
BEHIND THE STORY IN A MOMENT. - GEOPOLITICAL WEIGHT
CHINA COMMANDS A DIPLOMATIC PREMIUM. IT DOES SO BECAUSE
THE SIZE OF ITS ECONOMY IS NOW A CLOSER REFLECTION OF THE
COUNTRY’S HUGE POPULATION AND BREADTH. THE PREMIUM IS
ALSO DUE TO THE REALITY THAT GROWTH HAS INCREASINGLY
INTERTWINED ITS FATE WITH THAT OF THE 03, AND THE LEVEL OF
INTERACTION APPEARS TO BE HEADED INEXORABLY UPWARD. IT
SHOWS, IN TI-IB MINDS OF SMALLER PLAYERS, THE POSSIBILITY OF
COUNTERING A POTENTIALLY HEGEMONIC USA. IT HAS CHOSEN TO
EXERCISE A VERY ACTIVIST DIPLOMA TIC AGENDA. IT CAN
DEMONSTRATE GREAT SKILL IN SETTING ITS PRIORITIES AND
STICKING TO THEM.
IT HAS BEEN IN THE PROCESS, OVER THE LAST FEW MONTHS, OF
REDEFINING ITS CORE FOREIGN POLICY PRINCIPLES, MOVING
BEYOND THE FIVE PRINCIPLES OF PEACEFUL COEXISTENCE (1954)
WHICH 1-‘IAD HERETOFORE PROVIDED THE IDEOLOGICAL BEDROCK
OF FOREIGN RELATIONS, TOW ARDS AN EQUALLY THEORETICAL
(REMEMBER: MARXISTS MUST BE THEORETICIANS FIRST) BUT
COMPREHENSIBLE FRAMEWORK FOR PROMOTING ENGAGEMENT
AND PROSPERITY, PEACE AND SECURITY, THEMES ECHOED BY
PREMIER WEN IN OTT AW A IN DECEMBER. THE FRAMEWORK SPEAKS
OF ‘CONSTANTLY INCREASING COMMON GROUND’ AND PROMISES ‘A
CHINA THAT NEVER SEEKS HEGEMONY FOR ITSELF, WHICH WILL
MAKE FRESH CONTRIBUTIONS TO ASIA’S REJUVENATION AND
RENEW AL’. IT PROMOTES GLOBALIZATION, ASSERTING THAT ‘THE
WORLD ALSO NEEDS ASIA FOR PROSPERITY AND PROGRESS’.
THESE DECLARATIONS ARE ABOUT AS CREDIBLE AS OUR FAMOUS
‘PILLARS’. WHAT MATTERS IS THE PRAG MA TIC, NOT TO SAY
DRAMATIC, REVERSAL OF POLICIES, FROM THE MAOIST MIX OF
REVOLUTIONARY IDEOLOGY, AUTARCHY AND REALPOLITIK OF THE
SOS, 60S AND 70S, TO BROAD-BASED AND LARGELY SUCCESSFUL
ENGAGEMENT WlTH THE USA, EUROPE AND CHINA’S NEIGHBOURS IN
THE 1990S AND INTO THIS CENTURY.
THE ECONOMIC IMPERATIVE STILL COMMANDS. IT rs THE ‘NE PLUS
ULTRA’ OBJECTIVE THAT TRUMPS ALL OTHERS (EXCEPT,
IMPORTANTLY, FORT AlW AN), AND UNDERPINS THE SEARCH FOR
LEGITIMACY OF THE CCP. ECONOMIC RELATIONS IN THEIR
SPECIFICS, VIZ. MARKET ACCESS, MOUS ON STANDARDS, FX
ARRANGEMENTS, R&D COLLABORATION, RESOURCE DEALS, EVEN
FT AS NOW CARRY EQUAL WEIGHT, IN ALL POLICY ST ATE:MENTS AND
DECLARATIONS, TO THE HARDY PERENNlALS OF ENHANCED
POLITICAL RELATIONS AND THE ONE CHINA POLICY.
BUT CHINA’S STRENGTHS GO BEYOND THEORETICAL CONSTRUCTS,
RINGING DECLARATIONS AND ECONOMIC ACHIEVEMENTS. THE
POINT IS THAT CHINA’S DIPLOMATIC SKILLS ARE ALSO A VERY
SIGNIFICANT PART OF CHINA’S VISIBILITY IN THE GLOBAL
COMMONS.
TO ILLUSTRATE: CONSISTENT WITH ITS PRAGMATIC AND FOCUSSED
APPROACH TO PRIORITIES, CHINA IS SYSTEMA TI CALLY
CONSTRUCTING PARTNER RELATIONSHIPS ON ITS PERIPHERY, THE
HISTORICAL LOCUS PRIMUS OF ITS FOREIGN POLICY. IT IS ALSO THE
REGION THAT MUST MAKE THE GREATEST ADJUSTMENTS TO
CHINA’S RISING IMPORTANCE. CHINA’S NEIGHBOURS NEED TO BE
REASSURED THAT OPPORTUNITIES OUTWEIGH THE THREATS, BE
THEY ECONOMIC OR IN MATTERS OF SECURITY. IN THESE RESPECTS
AS WELL, CHINA CAN LEGITIMATELY CLAIM CONSIDERABLE
SUCCESS.
KOREAS CHINA LEADS THE USA, JAPAN, ROK AND RUSSIA IN THE
MANAGEMENT OF NEGOTIATIONS WITH UNIVERSALLY ACCLAIMED
BAD-BOY DPRK IN THE PROCESS OF DENUCLEARIZATION OF THE
KOREAN PENINSULA, A ROLE THAT IS THRUST UPON IT BY THE NEED
TO STABILIZE IT’S NORTHEAST FRONTIER. ARGUABLY, CHINA
CONTROLS AS MANY LEVERS AS HAVE THE US AND ROK. IT HAS – SO
FAR – VERY SKILFULLY MANAGED IMMENSELY COMPLEX SET OF
COMPETING PRIORITIES.
RUSSIA CHINA AND RUSSIA SIGNED A GOOD-NEIGHBOURLY TREATY
OF FRIENDSHIP AND COOPERATION IN 2001, AND FOLLOWED UP WITH
JIANG-PUTIN JOINT STATEMENT IN 2002 THAT HAS RESTRUCTURED
THE MAJOR ASPECTS OF THEIR POLITICAL, ECONOMIC AND
SECURITY RELATIONS. AMONG OTHER THINGS, THESE RECOGNIZED
THE SETTLEMENT OF OUTSTANDING BORDER ISSUES;
“UNDERSTANDINGS” ONT AIW AN IN EXCHANGE FOR
CONDEMNATION OF UIGUR INDEPENDENCE ACTIVISTS;
FACILITATION OF BORDER TRADE; MARKET ACCESS AND FOREIGN
EXCHANGE MECHANISMS; PROMOTION OF CRUDE OrL AND NATURAL
GAS PIPELINES (AL THOUGH THE JAPANESE HA VE UNDERCUT CHINA
ON THE FORMER, WITH THE ‘ANGARSK-NAKHODKA’ PIPELINE
THREATENING TO REPLACE ‘ANGARSK-DAQING’ AS THE PREFERRED
ROUTE). RUSSIA ACCEPTS THE PRESENCE OF ONE HUNDRED TO TWO
HUNDRED THOUSAND CHINESE TN ITS FAR EAST (IRKUTSK HAS 20,000
PRC CITIZENS), A SMALL PRICE TO PAY FOR BECOMING CHINA’S
PRINCIPAL SUPPLIER OF RELATIVELY SOPHISTICATED WEAPONRY,
INCLUDING SOVREMENY CLASS DESTROYERS, SU30 FIGHTER
AIRCRAFT AND KILO CLASS SUBMARINES.
MONGOLIA PRESIDENT HU STRENGTHENED RELATIONS WITH
MONGOLIA LATE LAST YEAR THROUGH BALANCING ITS ECONOMIC
DOMINANCE BY EXTENDING $300M JN LOANS. CHINA COULD
BECOME, BY 2005, MONGOLIA’S LARGEST SOURCE OF ODA. IT IS
ALREADY ITS LARGEST TRADING AND INVESTMENT PARTNER.
CENTRAL ASIA THE SHANGHAI COOPERATION ORGANIZATION HAS
GROWN FROM ITS 1996 ORIGINS TO BECOME, SINCE 2001, THE MAJOR
CHINESE VEHICLE FOR PROMOTING COOPERATION WITH CENTRAL
ASIA. WHAT HAD INITIALLY BEEN A :MEANS FOR ADDRESSING
BORDER DISPUTES AND SECURITY IN THE POST-SOVIET ERA HAS
GROWN TO INCLUDE BROAD ECONOMIC OBJECTIVES. A SUMMIT
HELD IN MOSCOW IN MAY 2003, FOLLOWED BY A MEETING OF
PREMIERS IN SHANGHAI lN SEPTEMBER HAVE GIVEN THE SCO ITS
ESSENTIAL POLITICAL BLESSINGS. OFFICES HA VE BEEN OPENED IN
BEIJING (THE SECRETARIAT, AS WELL AS ECONOMIC ISSUES) AND IN
BISHKEK, KYRGYZSTAN (ANTI-TERRORISM CENTER). ON ENERGY,
PROGRESS IS BEING MADE ON THE SINO-KAZAKH OIL PIPELINE
WHICH WILL LINK THE CASPIAN CITY OF A TYRAU TO CHINA’S
WESTERN XINJIANG PROVINCE, AND UL TIMA TEL Y PROVIDE 3 .SM
BARRELS PER DAY OF CRUDE. CHINESE STATE OIL COMPANIES
HAVE INVESTED IN THE AZERBAIJAN’S PIRSAAT AND AZERI OIL
FIELDS. TURKMENISTAN’S LEADER SAPARMURATNIYAZOV HAS
ACCORDED CHINA PREFERENTIAL TREATMENT ON NATURAL GAS
DEVELOP!vlENT, INCLUDING THE CONSTRUCTION OF A GAS PIPELINE,
ALSO TO XfNJIANG.
INDIA CHINA HAS DIRECTED A STEADY SHIFT OF EMPHASIS FROM
LONG-STANDING RELATIONS WITH PAKISTAN TOWARDS INCREASED
COLLABORATION WITH INDIA. BEYOND THE SUCCESSION OF HIGH
LEVEL VISITS AND PLETHORA OF DECLARATIONS IS ALSO REAL
PROGRESS ON OUTSTANDING BORDER ISSUES – THE SECOND ROUND
OF BORDER TALKS WERE CONCLUDED IN JANUARY. INDIA
MAINT AlNS 40% OF ITS FOR WARD TROOP DEPLOYMENT ON THE
INDIA-CHINA BORDER. RESOLUTION OF THE BORDER ISSUES WTLL
FREE SUBSTANTIAL FORCES FOR DEALING WITH PAKISTAN AND
KASHMIR. CHINA ALSO AlMS AT NEUTRALIZING US INFLUENCE IN
INDIA. TRADE WITH INDIA WILL SURPASS $10B THIS YEAR.
ASEAN SINCE 1997, CHINA HAS SIGNED AGREEMENTS WITH EACH OF
THE ASEAN COUNTRIES AIMED AT DEVELOPING SOUND BILATERAL
RELATIONS. IN 2000, CHINA PROPOSED AN ASEAN/CHTNA FTA. A
FRAMEWORK AGREEMENT WAS SIGNED IN PHNOM PENH IN 2002.
CHINA AND ASEAN HA VE ALSO SIGNED AN AGREEMENT AGAINST
THE USE OF FORCE TN THE SETTLEMENT OF DISPUTE IN THE SOUTH
CHINA SEA, AS WELL AS AN AGREEMENT ON NON-TRADITIONAL
SECURITY THREATS. IN 2003, CHINA ACCEDED TO THE ASEAN
TREATY OF AMITY AND COOPERATION. MOST OF THE ASEAN
COUNTRIES ARE IN SURPLUS IN THEIR TRADE WITH CHINA. ASEAN
TRADE WITH CHINA HAS GROWN RAPIDLY ON THE STRENGTH OF
INCREASED INTEGRA TTON, A PROCESS THAT WILL BE FURTHER
ACCELERATED AS THE PTA PROVISIONS ARE NEGOTIATED AND TAKE
EFFECT.
CHINA’S DIPLOMATIC SKILLS HOWEVER ARE LESS OBVIOUS WITH
RESPECT TO RELATIONS WITH JAPAN. CHINA HAS NOT DEVELOPED
A STRATEGY THAT CAN OVERCOME THE TWIN REALITIES OF THE
HTGHL Y POLITICIZED HISTORICAL LEGACY OF JAPAN’S INVASIO OF
CHINA IN THE 1930S AND 1940S, AND THE UNCERTAIN BUT
POWERFUL COURSE OF HAN NATIONALISM, A FORCE WHICH EVEN
THE COMMUNIST PARTY CANNOT FULLY CONTROL. THUS, THE
STEADY STREAM OF REMINDERS OF THE PAST -Y ASUKUNI – OR
INSULTS – JAPANESE SEX PARTIES IN ZHUHAI ON THE DATE OF THE
MARCO POLO BRIDGE INCIDENT; INSENSITIVE JAPANESE STUDENT
SKITS IN XIAN; EXPLODING MUSTARD GAS CANISTERS IN THE
FORMER MANCHURIA – ADDED TO THE KNOWLEDGE THAT OTHER
SUCH INCIDENTS ARE ONLY GOING TO CONTINUE TO ARISE –
OVERWHELM AN OTHERWISE STRONG RELATIONSHIP BASED ON
TRADE- OVER $100B IN 2003, AND DEVELOPMENT COOPERATION ($1B
PER YEAR), NOT TO SPEAK OF TOURISM, STUDENTS AND OTHER
PEOPLE TO PEOPLE EXCHANGES. THEY ALSO IMPEDE PROGRESS ON
OUTSTANDING ISSUES SUCH AS SENKAKU/DIAOYUT AI, OR LEAD TO
SERIOUS COMPETITION ON SUCH ISSUES AS ENERGY FROM RUSSIA.
KOIZUMI IS THE ONLY SENIOR NATIONAL LEADER WHO HAS NOT
YET UNDERTAKEN AN OFFICIAL VISIT TO CHINA, AND NO CHINESE
LEADER PRESIDENT OR PREMIER HAS VISITED JAPAN SINCE 2000.
THE WEIGHT AND SIGNIFICANCE OF ECONOMIC SIZE AND
DIPLOMATIC SKILL CANNOT BE UNDERESTIMATED IN EXPLAINING
CHINA’S RISE TO PRE-EMINENCE. THEY ALSO CREATE A VIRTUOUS
CIRCLE WHICH PROVIDE THE WHEREWITHAL TO DEVELOP OTHER
STRENGTHS, AND INCREASE THE BENEFITS OF GLOBAL
INTERACTION.
BUT THESE ALONE DO NOT PROVIDE CHINA WITH THE KIND OF
POWER THAT UNDERPINS GLOBAL SECURITY OR SHAPES
INTERNATIONAL INSTITUTIONS. IMAGINE THE DISTANCE WE ARE
FROM A WORLD WHERE THE CHINESE NA VY PROVIDES THE
SECURITY FOR THE STRAITS OF MALACCA, WHERE THE SHANGHAI
STOCK EXCHANGE SETS THE TRENDS IN GLOBAL SECURITIES
MARKETS, WHERE THE GLOBAL AUDIENCE FOR THE GOLDEN
ROOSTER AW ARDS IS GREATER THAN THAT FOR THE OSCARS,
WHERE THE YUAN BECOMES ONE OF THE WORLD’S THREE RESERVE
CURRENCIES, OR THE PUBLIC DECLARATIONS OF NGOS AND HUMAN
RIGHTS GROUPS HAIL CHINA AS A MODEL FOR DEMOCRATIC
DEVELOPMENT, AND WE CAN SEE WHAT A DISTANCE CHINA HAS TO
TRAVERSE BEFORE BECOMING A REAL COMPETITOR TO THE US OR
EU.
THUS, IT’S WEAKNESSES: - MILITARY WEAKNESS CHINA HAS NOT INCONSIDERABLE
STRENGTHS: MANPOWER – 2.4 MILLION UNDER ARMS, INCLUDING 1.6
MILLION IN THE GROUND FORCES, 417,000 IN AIR FORCE AND 230,000
IN THE NA VY. THIS DOES NOT INCLUDE OVER 1 MILLION IN THE
RESERVES. THERE IS LITTLE D1FFICUL TY TN RECRUTTJNG FROM AN
UNEMPLOYED PEASANTRY. IT HAS THE NECESSARY POLITICAL
WILL – THE CCP IS ASSIDUOUS IN INDOCTRINATION OF THE PLA. THE
PLA IS EXPLICITLY AN ARMY OF THE PARTY AND NOT A NATIONAL
ARMY AS ITT AKES PAINS TO CONFIRM IN REGULAR BRJEFINGS TO
FOREIGN VISITORS. JIANG ZEMIN STILL HEADS THE CENTRAL
MILITARY COMMISSION, TO WHICH HE BRINGS ALL OF HIS PRESTIGE
AND CONNECTIONS.
HOWEVER, TO CITE AMERJCAN SOURCES, THE SOLE CREDIBLE
LONG-RANGE POWER PROJECTION ASSETS IN PLA INVENTORY
CONSIST OF ICBMS (17+ ), IRBMS ( 46), SLBMS (ABOARD ONE XIA
NUCLEAR BOAT AND A DOZEN CONVENTIONAL BOATS); SRBMS ( 4+ ),
TRACKING SYSTEMS AND PHASED ARRAY RADARS. IN ADDITION, IT
POSSESSES A CURRENT ARSENAL OF BETWEEN 410 AND 440 MISSILES,
MOSTLY AIMED AT TAIWAN, TO WHICH IT IS ADDING ABOUT 50 NEW
MORE LETHAL MISSILES ANNUALLY. THE PLAN HAS FEW MODERN
SHIPS AND VERY LIMITED FORCE PROJECTION CAPACITY, BUT IT
MUST BE NOTED THAT THE NAVY IS MODERNISING THE MOST
RAPTDL Y AND MANY NEW MODERN DESTROYERS AND FRIGATES
ARE UNDER CONSTRUCTION. ON THE LAND AND IN THE AIR, IT HAS
A WIDE ARRAY OF CONVENTIONAL TANKS (8,200) AND AIRCRAFT
(5,400). MANY OF THESE ARE OBSOLESCENT AND INEFFECTIVE
AGAINST A MODERN FORCE. MOREOVER, IF THEY CANNOT GET TO
WHERE THEY ARE REQUlRED, IT MATTER LITTLE HOW MANY ARE TN
HANGARS.
FURTHERMORE, CIBNESE CAP ABILITY TO DEVELOP, PRODUCE AND
INTEGRATE SOPHISTICATED MILITARY SYSTEMS IS LIMITED AND
LIKELY TO REMAIN SO FOR AT LEAST A DECADE. THE DESIRE TO
ACCELERATE THE CAPABILITY IS CLEAR AND THE GENERAL
EQUIPMENT DEPARTMENT IS FOCUSSING ON IT BUT SUCCESS HAS
BEEN HAMPERED BY THE RIGID HIERARCHAL AND CENTRALISED
COMMAND STRUCTURE OF THE MILITARY. FOREIGN ACQUISITION
OFFSET BUT FALL SHORT OF COrvfPENSATING FOR THESE
WEAKNESSES. GENERALLY SPEAKING CHJNESE DEFENCE
INDUSTRIES HA VE A POOR RECORD OF PROVIDING THE PLA WHAT
THEY NEED. THAT HA YING BEEN SAID, SIGNS OF MORE EFFECTIVE
DESIGN, INTEGRATION, PRODUCTION AND PROCUREMENT
APPROACHES AND SYSTEMS ARE EVIDENT.
THE CURRENT RELIANCE ON RUSSlA FOR DESIGN, PRODUCTION,
REP AIR AND MAINTENANCE OF SHIPS, SUBMARINES AND FIGHTER
AIRCRAFT rs SIGNIFICANT, BUT RUSSIA IS NOT TRANSFERRING THE
MEANS OF PRODUCTION FOR WEAPONS SYSTEMS AND END USE
ITEM.SOR EVEN KEY COMPONENT PARTS. MOREOVER, THE
RUSSIANS ARE CLEARLY NOT SELLING THE TOP OF THE LINE
EQUIPMENT TO THE CHINESE. MILITARY COLLABORATION WITH
CHINA IS VIEWED IN RUSSIAN MILITARY CIRCLES AS A WAY TO
OBI AIN HARD CURRENCY AND TO KEEP ITS OWN PRODUCTION AND
RESEARCH FACILITIES OPERA TING. IT IS UNLIKELY IHA T THE
CHINESE CAN RELY ONLY ON RUSSIA EXCLUSIVELY. SIGNIFICANT
DIPLOMATIC AND FINANCIAL EFFORT HAS BEEN EXPENDED ON
ACCESSING OTHER SOURCES. CHINA’S NEED FOR WESTERN
TECHNOLOGY IS PROFOUND AND ALL EFFORTS ARE BEEN USED TO
OBT ATN ACCESS – FAIR OR FOUL.
FINALLY, COMPARE THE CHINESE MILITARY TO ITS PUTATIVE
ADVERSARIES IN THE NEIGHBOURHOOD.
JAPAN: 242,600 ACTIVE FORCES, AND A NA VY HA YING 16 SUBS, NINE
DESTROYERS, 48 FRIGATES ETC. ALL IMPORTANT JAPANESE
EQUIPMENT IS RELATIVELY NEW AND TOP RA TE.
ROK; 560,000 GROUND FORCES; 60,000 NAVY, INCLUDING 14 SUBS,
ONE DESTROYER, 33 FRIGATES ETC. THE MILITARY IS RELATIVELY
WELL EQUIPPED.
TAIWAN: 376,000 PLUS 1,660,000 ACTIVE RESERVES. THE CAPABILITY
OF THE TAIWAN MILITARY IS LIMITED BECAUSE OF ITS AWKWARD
COMMAND AND CONTROL SYSTEM AND EVEN NOW VESTIGES OF
THE OLD KMT SECRECY.
USA: IT RETAINS, IN THE VICINITY OF CHINA, IN THE ORDER OF
100,000 TROOPS AT ALL TIMES, INCLUDING AT BASES IN GUAM,
JAPAN, ROK, AND SINGAPORE. OPERATIONALLY THE FORCES IN THE
ASIA-PACIFIC BELONG TO PACOM, ONE OF FIVE US INTEGRATED
COMMANDS, HEADQUARTERED IN HAW All. THE PACOM FORCES ARE
LARGELY NAVAL AND AIR WITH A GOOD PROPORTION OF THE
TROOPS PROVIDING FACILITIES AND EQUIPMENT THUS
FACILITATING FORCE PROTECTION AND SUSTAINMENT. THE US HAS
A PROVEN RECORD OF DEPLOYING AND SUSTAINING TROOPS
ANYWHERE IN THE WORLD: THEIR POWERFUL CARRIER BA TILE
GROUPS, AIR FORCES AND EFFECTIVE COMMAND AND CONTROL
CAP ABILITY HA VE A DEMONSTRATED FORCE PROJECTION
CAP ABILITY THAT CANNOT CURRENTLY BE MATCHED.
THUS, CHINA DOES NOT YET POSSESS AND WILL NOT FOR THE 15 TO
20 YEARS, ACCORDING TO SOME US STUDIES, POWER PROJECTION
CAP ABILITIES THAT WILL MAKE IT OVERWHELMINGLY DOMINANT
IN EAST ASIA. IN ADDITION, ITS TRANSITION TO A MODERN
FIGHTING FORCE IS LIMITED BECAUSE OF ITS CENTRAL FOCUS ON
THE TAIWAN SITUATION. - MICROECONOMIC WEAKNESSES
CHINA’S MACRO-ECONOMIC GROWTH MAY BE THE SUM OF MICROECONOMIC
DEVELOPMENT, BUT THE SPEED OF THIS DEVELOPMENT
HAS CREATED DISTORTIONS THAT LIMIT THE CHINA’S POTENTIAL,
AT LEAST IN THE SHORT TO MEDIUM TERM. THIS ARGUMENT IS
ELABORATED IN THE SEP ARA TE PAPER – GLOBALIZATION AND
CHINA’S REFORMS, WIDCH MAKES THE FOLLOWING POINTS:
WHILE THE 1990S OFFERED AN INTERNATIONAL ENVIRONMENT THAT
WAS AT ONCE NON-THREATENING AND FAVORABLE TO CHINA’S
RAPfD ECONOMIC EXP ANSI ON, THE COMING DECADE WILL BE MORE
DIFFICULT, FOR REASONS MORE CLEARLY AS SOCIA TED WITH
DOMESTIC BOTTLENECKS THAN UNFORESEEN (AND
UNPREDICTABLE) INTERNATIONAL DEVELOPMENTS. IN ORDER TO
SUSTAIN GROWTH fN AN INCREASINGLY COMPETITIVE
ENVIRONMENT, CHINA WILL HA VE TO REFORM MORE PROFOUNDLY
ITS ECONOMIC SYSTEM, BY ALLOWING INCREASED TRANSPARENCY,
OPEN DOMESTIC MARKETS, STRONGER REGULATORY INSTITUTIONS
AND POSSIBLY A POLITICAL SYSTEM MORE OPEN TO COMPETITION.
TO ILLUSTRATE: CHINA HAS BECO11:E A POWERHOUSE PRODUCER OF
WHJTE GOODS AND CONSUMER ELECTRONICS, REMINISCENT OF THE
DEVELOPMENT STRATEGIES OF JAPAN, KOREA AND THE SOUTHEAST
ASIAN TIGERS. CHINA IS REAPING THE BENEFITS OF IMPLEMENTING
AN FDI FAVOURABLE ENVIRONMENT, IN A COUNTRY WHOSE
CONSUMER MARKET MAY GROW TO SPECTACULAR PROPORTIONS. IT
HAS ESSENTIALLY A BOTTOMLESS POOL OF INEXPENSIVE LABOUR,
INCLUDING WELL EDUCATED YOUNG ADULTS COMING ONTO THE
LABOUR MARKETS. CHINESE PRODUCERS BENEFIT FROM MODEST
R&D SUBSIDIES, AND THERE ARE (DECLINING) SUBSIDIES FOR
EXPORTS, IN THE FORM OF VAT REBATES.
BUT CHINA HAS MANY SIGNIFICANT WEAKNESSES THAT WILL TAKE
TIME TO OVERCOME. FOR EXAMPLES:
- IT DOES NOT YET POSSESS A SUPPORTIVE FINANCIAL
INFRASTRUCTURE (CHINESE BANKS DO NOT INVEST IN INNOVATION;
FOREIGN BANKS ARE FORBIDDEN TO DO SO; THE STOCK MARKETS
ARE HIGHLY RIGID, ONLY LIST SOEs, AND THERE IS LITTLE
TRANSPARENCY IN THE CORPORA TE BOOKS; ITS VENTURE CAPITAL
MARKETS ARE PRIMITIVE TO NON-EXISTENT; IT DOES NOT HA VE A
BOND MARKET; ITS BROKERS ARE CORRUPT) ; - IT POSSESSES VERY FEW GLOBAL COMPANIES, AND VIRTUALLY NO
KNOW BRANDS; WHAT NATIONAL BRANDS IT DOES HA VE DO NOT
PROVIDE A MARGIN OF PROFITABILITY; - THE PATENT BASE IS NOT YET DEVELOPED (A RAND SURVEY NOTED
THAT CHINA REGISTERED 195 TECHNOLOGY PA TENTS LAST YEAR,
VS. 86,610 IN THE US, IN THE SAME SECTOR); - MANAGEMENT AND MARKETING SKILLS ARE VERY WEAK;
- IP PROTECTION IS POOR TO NON-EXISTENT. ET CETERA.
THESE PROBLEMS ARE FUNDAMENTAL AND STRUCTURAL. MANY
REQUIRE THE EVOLUTION OF ADVERSARIAL SYSTEMS SUCH AS A
TRULY INDEPENDENT LEGAL SYSTEM, AN INSTITUTION WITH WHICH
THE CCP DOES NOT NOW WISH TO CONTENANCE.
MORE TO THE POINT, THE LIST ABOVE INDICATES CLEARLY WHERE
CANADIAN AND FOREIGN FIRMS WILL FIND THEIR STRENGTHS: IN
MANAGEMENT, DISTRIBUTION, QUALITY, ACCESS TO CAPITAL ETC.
- SOCIAL AND POLITICAL WEAKNESSES
THE AUTHORITARIAN POWER OF THE CCP MAY CREATE THE
IMPRESSION THAT, DOMESTICALLY, CI-IlNA IS STRONG, BUT IN MANY
WAYS IT IS WEAK.
- THERE ARE IMMENSE GAPS IN STANDARD OF LIVING BETWEEN
THE EASTERN AND WESTERN PARTS OF THE COUNTRY
(BEIITNG’S PER CAPITAL GDP lS 9 TIMES THAT OF GUIZHOU);
BETWEEN THE URBAN RICH ($4,000 PER CAPITA) AND THE
RURAL POOR (TWO HUNDRED MILLION CHINESE LIVE ON LESS
THAN $1 PER DAY); - THE CCP RELIES ON LENINISM, AUTHORITARIANISM, LACK OF
TRANSPARENCY AND A FREE PRESS; IT HAS LITTLE VISIO FOR
THE FUTURE OTHER THAN WHAT IT BORROWS FROM ABROAD
ON MATTERS OF GOVERNANCE, AND THE FIRM INSISTENCE ON
ITS OWN SURVIVAL, AT A TIME WHEN WHAT THE COUNTRY
NEEDS IS OPENNESS, RULE OF LAW, AND DEMOCRACY FOR
PARTICIPATION IN GROWTH AND DEVELOP:MENT; - THERE IS AN OVER RELIANCE ON COERCION AND THE
SECURITY ESTABLISHMENT; - THE RISKS TO GROWTH ARE MANY: ON PROBABILITY CURVE,
THEY INCLUDE PARALYSIS THAT COMES FROM POLICY
DISPUTES WITHIN THE PARTY; LACK OF PUBLIC FAJTH TN
BANKING SYSTEM, AND ITS ATTENDANT FALLOUT;
- LACK OF MORAL LEADERSHIP
TO BE TRULY POWERFUL, A COUNTRY MUST EXPRESS AND EMANATE
HIGHER GOALS. IT MUST REPRESENT IDEALS AND IDEAS. ITS PEOPLE
AND THEIR GOVERNANCE MUST BE MODELS FOR OTHERS TO
FOLLOW. ITS ARTS MUST INFLUENCE ARTS AND STYLES IN OTHER
COUNTRIES, IN OTHER MEDIA.
THE UNITED ST ATES HAS ITS FREEDOMS AND ITS POPULAR
CULTURE. FRANCE HAS ITS REVOLUTION AND ITS DEMOCRATIC
IDEALS. CANADA HAS ITS WELCOME TO THE IMMIGRANTS OF THE
WORLD, AND ITS ENVIABLE WAYS OF ADDRESS.ING SOCIETAL
CONFLICTS. JAPAN HAS GIVEN THE WORLD A UNIQUE CUISINE.
Cl-IlNA WILL ONE DAY INFLUENCE NOT ONLY THROUGH ITS
ECONOMTC AND GEOPOLITICAL MIGHT, BUT THROUGH ITS CULTURE
AND, ONE HOPES, THE AMALGAMATION OF ITS HISTORICAL LEGACY
WlTH DEMOCRATIC IDEALS AND PRACTICES UN1QUE TO MODERN
TIMES. CHJNA IS NOT YET IN THAT POSITION. IT IS NOT A MODEL FOR
GOVERNANCE AND THE REGIME’S TREATMENT OF ITS OPPONENTS IS
PROFOUNDLY DISTURBING.
IT WILL NOT BE A TRUE POWER UNTIL BOTH ITS GOVERNANCE HAS
LESSONS FOR THE WORLD, AND ITS ART FORMS HA VE FOUND
ACCEPTANCE THROUGHOUT THE WORLD, AN ACCEPTANCE
COMMENSURATE WITH ITS WEALTH AND ACCOMPLISHrvffiNT.
CHINESE FOREIGN POLICY
OUT OF THIS MIX OF STRENGTHS AND WEAKNESSES EMERGE A SET
OF FOREIGN POLICIES, WITH THE FOLLOWING CHARACTERISTICS: - IDEOLOGY:
AT THE CORE OF THE CCP’S THINKING IS THE ‘YIGE ZHONGXlN,
LIAN GE JIB END IAN’, WHICH IMPOSES LENINIST TRUTHS THAT
CANNOT BE DISPUTED. THEORY IS IMPORTANT
a) FROM POST REVOLUTIONARY MAOIST SUSPICION OF
INTERNATIONAL INSTITUTIONS AS VEHICLES TO CONSTRAIN CHINA;
b) TO AN IDEALISTIC PHASE OF FOREIGN POLICY WHICH EXPRESSED
THE BELIEF IN REVOLUTION AND CHANGE – A NEW UNITED NATIONS
FOR EXAMPLE, THE POWER OF THE NON-ALIGNED;
c) TO DENG XIAOPING AND ‘TAOGUAN YANGI-nJI, YOUSHOU ZUOWEI’;
VIZ KEEP A LOW PROFILE, BUT ACT WHEN NEEDED;
d) TO 1997 AS PRECIPITATING A FUNDAMENTAL CHANGE IN THE
FOREIGN AFFAIRS MIND-SET, ONE THAT AFFIRMED TI-IE IDEA THAT
CERTAIN PROBLEMS, LIKE FINANCIAL STABILITY, ECONOMIC
GROWTH, EVEN SECURITY, COULD BE ASSISTED THROUGH
MULTILATERAL AND PLURILATERAL COLLABORATION, AS WELL AS
BILATERAL; THESE ARE NOT IN COMPETITION, BUT RATHER WORK IN
HARMONY; - A MULTIPLICITY OF POLICY OBJECTIVES
a) SOVEREIGNTY AND TERRITORIAL INTEGRITY
b) SECURITY
c) RETENTION OF TAIWAN
d) ECONOMIC DEVELOPMENT
e) PROIBCTION OF A POSITIVE IMAGE TO THE WORLD. - FOREIGN POLICY OF TRANSITION AND PRAGMATISM, FLEXIBILITY
AND INNOVATIVENESS, SOMETIMES IN COMBINATION WITH STASIS
AND CONSERVATISM.
IT IS CHARACTERIZED BY LONG-TERM THINKING AND PLANNING,
THE ‘REACTIVE MINIMALISM’ APPROACH AT THE UNITED NATIONS,
CAUTION AT THE WTO.
BUT IT ALSO SHOWS CREATIVITY AND DRIVE, SUCH AS WITH ASEAN
PLUS ONE, THE CREATION OF THE SHANGHAI COOPERATION
ORGANIZATION, STRATEGIC RELATIONSHIPS INSTEAD OF
ALLIANCES, WITHKEYPARTNERS. - HIERARCHY OF RELATIONS, AT BILATERAL AS WELL AS
MULTILATERAL LEVELS.
THE UNITED STATES, IN BEIJING, AS IN OTTAWA, IS PRIMUS IN A
CATEGORY ALL ITS OWN. THE NEIGHBOURS – 14 CONTIGUOUS LAND
BORDERS AND ABUTMENT OR OVERLAPPING CLAIMS AT SEA ‘WITH
MORE THAN HALF A DOZEN OTHERS – EITHER SINGLY OR GROUPED,
AS IN A SEAN OR IN THE SHANGHAI COOPERATION ORGANIZATION,
HA VE THEIR OWN PRIVILEGED AND NOT-SO-PRIVILEGED PLACES,
AND RES UL TING POLICY SETS.
THIS LEAVES ABOUT 145 OTHER COUNTRIES. THESE TOO HA VE THEIR
HIERARCHY, AND IT IS NOT TOO DIFFICULT TO DIFFERENTIATE
WHO’S ON FIRST, OR RATHER, SECOND AND TlilRD AS THE
HIERARCHY HERE RELATES RATHER TO MEASURABLE FACTORS.
THERE IS A CERTAIN ‘GIVEN’ IHA T CONSISTS LARGELY OF THE
‘CRITICAL MASS’ OF THE RELATIONSHIP. ECONOMIC BENEFITS –
TRADE AND INVESTMENT, TECHNOLOGY FLOWS, ACCESS TO
RESOURCES ETC – WEIGH HEAVILY ON THIS SCALE. OTHER FACTORS
SUCH AS LINKAGES IN THE FIELD OF EDUCATION, SCIENCE AND
TECHNOLOGY, TOURISM ARE IMPORTANT. BECAUSE GOVERNMENT
POLICIES CAN SHAPE THESE FACTORS OVER TIME, FOREIGN
MINISTRIES, INCLUDING OUR OWN, SPEND A GREAT DEAL OF EFFORT
TO ESTABLISHING PRIORITIES AND DEVOTING RESOURCES TO THE
‘BROADENING AND DEEPENING’ EFFORT. - THE ECONOMIC IMPERATIVE, AS SEEN THROUGH:
a) THE USA/CHINA RELATIONSHIP
b) ECONOMIC DIPLOMACY WITH ASEAN, MONGOLIA, AFRICA
c) RESOURCE DIPLOMACY THROUGHOUT THE WORLD, ESPECIALLY
TARGETING OIL AND GAS, BUT ALSO OTHER MINERALS - THE MANAGEMENT OF INTERNATIONAL SECURITY
a) THE KOREAN PENINSULA
b) US, INCLUDING TAIWAN
c) NON-PROLIFERATION AND WMD
d) INTERNATIONALIZATION OF THE FIGHT AGAINST THE ‘THREE
EV1LS’ OF EXTREMISM, TERRORISM AND SEPARATISM
THESE ARE TI-IE REAL PILLARS OF CHINA’S FOREIGN POLICY TODAY.