China: A new superpower? : Dimensions of power, energy and security

China A New Superpower? Dimensions of Power, Energy, and Security

Edited By Assoc. Prof. Atilla SANDIKLI

PUBLICATIONS

Istanbul 2010

WISE MEN CENTER FOR STRATEGIC STUDIES

C 2010 All rights reserved. Any part of this book cannot be reproduced or used by anyone without permission of the publisher.

Address: Wise Men Center For Strategic Studies (BILGESAM) Mecidiyeköy Yolu Cd. Celilaga Is Merkezi No: 10 Kat: 9 Daire: 36 Mecidiyeköy / Istanbul / TURKEY Phone: +90 212 217 65 91 Fax : +90 212 217 65 93 [email protected] www.bilgesam.org ISBN: 978-605-89672-1-2

CONTENTS

Preface Introduction 1. The Geopolitics of China: A Great Power Enclosed Dr. George FRIEDMAN 2. China: Future's Superpower? Assoc. Prof. Atilla SANDIKLI 3. China's Growing Need of Energy and Changing Balances Assoc. Prof. Atilla SANDIKLI 4. China's Escalating Military Power: Global and Regional Impact Dr. Subhash KAPILA 5. China's Perspective and Policies on New Security Environment Dr. Zhang ZUQIAN 6. China's Security Strategy towards Japan: Perceptions, Policies and Prospects Dr. Jian YANG 7. Countering US Hegemony: A Viable Option for China? Dynamics of the Sino-U.S. Relations in the Post Cold War Era Dr.Cagdas UNGOR III

8. EU-China Security Relations Dr. Marchin ZABOROWSKI 9. China's EU Policy Paper 10. The Changing Role of Nationalism within China's Domestic and Foreign Policies Ghulam ALI 11. East Asian Regionalization and China's Soft Power in Southeast Asia Kadir AYHAN 12. A Critical Approach to China's African Policy Ceren ERGENC 13. Turkey-China Economic Relations Assoc. Prof. Atilla SANDIKLI

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Preface

Preface The People's Republic of China with a visibly booming economy in the last decades created its own economic spheres of influence and came to affect the overall balances in the world. The consequences of its economic advance and ever growing energy consumption are emerging as significant variables capable of shaping international political developments. With the expanding military build-up, China is also generating concerns beyond its immediate neighborhood. Clarifying the rapid growth of China and worldwide implications of this process constitute the first major motivation behind publishing this study. Benefited of the opportunities of the globalization in the postCold War period, China has a progressively more integrated economy with the global markets. China with its increasing economic and military capacities is turning in to a robust power base in the eastern hemisphere. With a thriving position in world politic s and ability to influence events and to protect its own interests at global scale, Beijing has the potential to be a superpower. The other major motivation thus appeared from the necessity to question whether China will achieve to be a superpower in the near future. Wise Men Center For Strategic Studies (BILGESAM) moving from these two motivations -understanding the rise of China and analyzing its ability to be a superpower- published this collection of prominent articles on the People's Republic of China. BILGESAM in line with its objective of promoting peace and prosperity gives importance to researching the policies of the great powers at global and regional levels and foreseeing the prospective developments. In this respect, China A New Superpower? Dimensions of Power, Energy, and Security is a substantial step forward. V

The book in a nutshell is intended to provide the audience with a detailed analysis of the growing role of China in global politics and economy by elucidating its rise within the realms of power, energy, and security. It comprises fourteen articles, official papers, and conference presentations which deal with subjects ranging from geopolitics, foreign policy, and military power of China to its economy and energy needs. Introduction gives an overview on the geography and society of China as well as its history from antiquity to the present. Dr. George FRIEDMAN's work The Geopolitics of China: A Great Power Enclosed makes a comprehensive description of the geopolitics of the country and mentions the relevant strategic concerns of Beijing. The second chapter China: Future's Superpower? illustrates mainly the on going extraordinary economic growth of China with future predictions and summarizes its foreign policy stand points. The third part China's Growing Need of Energy and Changing Balances describes its growing energy consumption and refers possible consequences of this process for the international relations of China. Dr. Subhash KAPILA, Dr. Zhang ZUQIAN, and Dr. Jian YANG's works deal with the rising Chinese military power and Beijing's perspectives and strategiesin the new global and regional security environment. Articles contributed by Dr. Cagdas UNGOR, Dr. Marchin ZABOROWSKI, and Ceren ERGENC inspect the Chinese foreign policy tendencies and dynamics towards the United States, European Union, and Africa. Ghulam ALI's study The Changing Role of Nationalism within China's Domestic and Foreign Policies takes a closer look on the impact of Chinese nationalism over the internal politics and foreign policy approaches of the People's Republic of China. Kadir AYHAN's article, East Asian Regionalization and China's Soft Power in Southeast Asia analyzes the soft power potential of Beijing in the context of regionalization of East Asia with special reference to the ASEAN. Finally, the last chapter looks through the Turkey-China commercial relations VI

with detailed historical accounts and proposes a number of recommendations to improve bilateral trade. I would like to thank John MAULDIN, Dr. George FRIEDMAN, Dr. Subhash KAPILA, Dr. Zhang ZUQIAN, Dr. Jian YANG, Dr. Cagdas UNGOR, Dr. Marchin ZABOROWSKI, Ghulam ALI, Kadir AYHAN, and Ceren ERGENC for their valuable contributions. On behalf of BILGESAM, I appreciate these distinguished authors who gave us the opportunity to compile a new publication on China. Without their exclusive articles, this book would not be published. I hope that this study will be a useful source for all the students and scholars of international politics and pave the way for further research to understand and explain better the extending political and economic influence of China.

Assoc. Prof. Atilla SANDIKLI BILGESAM President Editor

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Introduction* 1. Location and Territory The People's Republic of China is situated in the eastern part of the Asian Continent on the western coast of the Pacific. With a total land area of around 9.6 million square km, China is the largest country in Asia and the third largest in the world, next to Russia and Canada. From north to south, the territory of China stretches from the center of the Heilong River north of the town of Mohe to the Zengmu Reef at the southernmost tip of the Nansha Islands, covering a distance of 5,500 km. From east to west, the nation extends from the confluence of the Heilong and Wusuli rivers to the Pamirs, covering a distance of 5,200 km. With a land boundary of some 22,800 km, China is bordered by Korea to the east; Mongolia to the north; Russia to the northeast; Kazakhstan, Kyrgyzstan and Tajikistan to the northwest; Afghanistan, Pakistan, India, Nepal and Bhutan to the west and southwest; and Myanmar, Laos and Vietnam to the south. Across the seas to the east and southeast are the Republic of Korea, Japan, the Philippines, Brunei, Malaysia and Indonesia. China has vast adjacent seas, with its mainland facing the Bohai Sea, the Yellow Sea, the East China Sea and the South China Sea on the east and south. The area of China's territorial seas stands at 380,000 square km. According to the latest Comprehensive Survey of China's Isle Resources, China has under its jurisdiction 6,961 islands, each having an area of over 500 square meters, with 433 of them being inhabited and the rest remaining uninhabited. In line with the principle of "one country, two systems," another 411 islands are now under the jurisdiction of Taiwan and Hong Kong and Macao special administrative regions. The mainland coastline is 18,000 km and that of the islands 14,000 km, giving China a total coastline distance of 32,000 km, the eighth longest in the world. 1

2. Geographical Features China has many mountains, with mountainous areas, which consist of mountains, hills and plateaus, making up two thirds of its total land area. Of various landforms, mountains account for about 33 percent; plateaus, about 26 percent; basins, about 19 percent; plains, about 12 percent; and hills, about 10 percent. China's topography was formed around the emergence of the Qinghai-Tibet Plateau, the most important geological event over the past several million years. Taking a bird's-eye view of China, the terrain gradually descends from west to east like a staircase. Due to the collision of the Indian and Eurasian plates, the Qinghai-Tibet Plateau rose continuously to become the top of the four-step "staircase," averaging more than 4,000 m above sea level, and is called "the roof of the world." Soaring 8,844.43 m above sea level on the plateau is Mount Qomolangma (Mount Everest), the world's highest peak and the main peak of the Himalayas. The second step includes the gently sloping Inner Mongolia Plateau, the Loess Plateau, the Yunnan-Guizhou Plateau, the Tarim Basin, the Junggar Basin and the Sichuan Basin, with an average elevation of between 2,000 m and 1,000 m. The third step, dropping to 1,000500 m in elevation, begins at a line drawn around the Greater Hinggan, Taihang, Wushan and Xuefeng mountain ranges and extends eastward to the coast of the Pacific Ocean. Here, from north to south, are the Northeast Plain, the North China Plain and the Middle-Lower Yangtze Plain. Interspersed amongst the plains are hills and foothills. To the east, the land extends out into the ocean, in a continental shelf, the fourth step of the staircase. The water here is mostly less than 200 m deep. China abounds in rivers. There are more than 1,500 rivers and each drains 1,000 sq km or larger areas. Most of the large rivers have their source on the Qinghai-Tibet Plateau, and drop greatlyd 2

between source anmouth. As a result, China is rich in water-power resources, leading the world in hydropower potential, with reserves of 680 million kw. China's rivers can be categorized as exterior and interior systems. The catchment area of the exterior rivers that empty into the oceans accounts for 64 percent of the country's total land area. The Yangtze, Yellow, Heilong, Pearl, Liaohe, Haihe and Huaihe rivers flow east, and empty into the Pacific Ocean. The Yarlungzangbo River in Tibet, which flows first east and then south into the Indian Ocean, boasts the Yarlungzangbo Grand Canyon, the largest canyon in the world, 504.6 km long and 6,009 m deep. The Ertix River flows north from the Xinjiang Uygur Autonomous Region to the Arctic Ocean. The catchment area of the interior rivers that flow into inland lakes or disappear into deserts or salt marshes makes up about 36 percent of China's total land area. The Tarim River, 2,179 km long, in southern Xinjiang is China's longest interior river. The Yangtze, 6,300 km long, is the largest river in China, and the third largest in the world, next only to the Nile in Africa and the Amazon in South America. Passing through high mountains and deep valleys, the upper section of the Yangtze River is abundant in water resources. Known as the "golden waterway," the Yangtze is a transportation artery linking west and east with its excellent navigation channel. The middle and lower Yangtze River areas have a warm and humid climate, plentiful rainfall and fertile soil, making them important agricultural regions. The Yellow River is the second largest river in China with a length of 5,464 km. The Yellow River valley was one of the birthplaces of ancient Chinese civilization. It has lush pasturelands along its banks, flourishing agriculture and abundant mineral deposits. The Heilong River is a large river in north China with a total length of 4,350 km, of which, 3,101 km are in China. The Pearl River (Zhujiang), 2,214 km long, is a large river in south China. In addition to those bestowed by nature, China has a famous man-made river - the Grand Canal, 3

running from Beijing in the north to Hangzhou in Zhejiang Province in the south. Work first began on the Grand Canal as early as in the fifth century BC It links five major rivers: the Haihe, Yellow, Huaihe, Yangtze and Qiantang. With a total length of 1,801 km, the Grand Canal is the longest as well as the oldest man-made waterway in the world. China's territory includes numerous lakes, most of which are found on the Middle-Lower Yangtze Plain and the Qinghai-Tibet Plateau. Freshwater lakes such as Poyang, Dongting, Taihu and Hongze mostly lie in the former area, while in the latter are saltwater lakes, such as Qinghai, Nam Co and Siling Co. Poyang Lake, in the north of Jiangxi Province and with an area of 3,583 sq km, is the largest of its kind. Qinghai Lake, in northeast Qinghai Province and with an area of 4,583 sq km, is the largest one of its kind. 3. Climate Most of China lies in the north temperate zone, characterized by a warm climate and distinctive seasons, a climate well suited for habitation. Most of China has a continental monsoon climate. From September to April the following year, the dry and cold winter monsoons blow from Siberia and the Mongolian Plateau, resulting in cold and dry winters and great differences between the temperatures of north and south China. From April to September, warm and humid summer monsoons blow from the seas in the east and south, resulting in overall high temperatures and plentiful rainfall, and little temperature difference between north and south China. In terms of temperature, the nation can be sectored from south to north into equatorial, tropical, subtropical, warm temperate,between north and south China. In terms of temperature, the nation can be sectored from south to north into equatorial, tropical, subtropical, warm-temperate, temperate, and cold-temperate zones. Precipitation gradually declines from the southeastern to the northwestern inland area, and the average 4

annual precipitation varies greatly from place to place. In southeastern coastal areas, it reaches over 1,500 mm, while in northwestern areas, it drops to below 200 mm. 4. Land and Mineral Resources When describing China's cultivated land and mineral resources, people often use many huge numbers. Cultivated land, forests, grasslands, deserts and tidelands are distributed widely across China. Cultivated land is mainly located in east China, grasslands are mainly located in the north and west, and forests mainly in the remote northeastern and southwestern areas. In China today, 130.04 million ha of land are cultivated, mainly on the Northeast Plain, the North China Plain, the Middle-Lower Yangtze Plain, the Pearl River Delta and the Sichuan Basin. The fertile black soil of the Northeast Plain, the largest plain in China with an area of more than 350,000 sq km, abounds in wheat, corn, soybeans, sorghum, flax and sugarbeet. The deep, brown topsoil of the North China Plain is planted with wheat, corn, millet and cotton. The Middle-Lower Yangtze Plain's flat terrain and many lakes and rivers make it particularly suitable for paddy rice and freshwater fish, hence its designation of "land of fish and rice." This area also produces large quantities of tea and silkworms. The purplish soil of the warm and humid Sichuan Basin is green with crops in all four seasons, including paddy rice, rapeseed and sugarcane, making it known as the "land of plenty." The Pearl River Delta abounds with paddy rice, harvested 2-3 times every year. Forests cover only 174.91 million ha of China. The Greater Hinggan, Lesser Hinggan and Changbai mountain ranges in the northeast are China's largest natural forest areas. Major tree species found here include conifers, such as Korean pine, larch and Olga 5

Bay larch, and coniferous-broadleaf trees such as white birch, oak, willow, elm and Northeast China ash. Major tree species in the southwest include the dragon spruce, fir and Yunnan pine, as well as teak, red sandalwood, camphor, nanmu and padauk. Often called a "kingdom of plants," Xishuangbanna in the south of Yunnan Province is a rare tropical broadleaf forest area in China, playing host to more than 5,000 plant species. Grasslands in China cover an area of 400 million ha, stretching more than 3,000 km from the northeast to the southwest. They are the centers of animal husbandry. The Inner Mongolian Prairie is China's largest natural pastureland, and home to the famous Sanhe horses, Sanhe cattle and Mongolian sheep. The important natural pasturelands north and south of the Tianshan Mountains in Xinjiang are ideal for stockbreeding. The famous Ili horses and Xinjiang fine-wool sheep are raised here. China's cultivated lands, forests and grasslands are among the world's largest in terms of sheer area. But due to China's large population, the per-capita areas of cultivated land, forest and grassland are small, especially in the case of cultivated land - only one third of the world's average. China is rich in mineral resources, and all the world's known minerals can be found here. To date, geologists have confirmed reserves of 158 different minerals, putting China third in the world in terms of total reserves. Reserves of the major mineral resources, such as coal, iron, copper, aluminum, stibium, molybdenum, manganese, tin, lead, zinc and mercury, are in the world's front rank. China's basic coal reserves total 337.34 billion tons, mainly distributed in northwest China and north China, with Xinjiang Uygur Autonomous Region, Shanxi Province and the Inner Mongolia Autonomous Region heading the field. China's 21.76 billion tons of the basic iron ore reserves are mainly distributed in 6

northeast, north and southwest China. The country also abounds in petroleum, natural gas, oil shale, phosphorus and sulfur. Petroleum reserves are mainly found in northwest, northeast and north China, as well as in the continental shelves of east China. The national reserves of rare earth metals far exceed the combined total for the rest of the world. 5. Plants and Animals China is one of the countries with the greatest diversity of wildlife in the world. There are more than 6,266 species of vertebrates, 10 percent of the world's total. Among them 2,404 are terrestrials and 3,862 fishes. There are more than 100 wild animal species unique to China including such well-known rare animals as the giant panda, golden-haired monkey, South China tiger, browneared pheasant, red-crowned crane, red ibis, white-flag dolphin and Chinese alligator. The black-and-white giant panda weighs on average 135 kg and lives on tender bamboo leaves and bamboo shoots. Because it is extremely rare - just over 1,500 are left at present - it has become the symbol of the world's protected wild animals. The red-crowned crane, that could be as tall as 1.2 m, is covered with white feathers, with a distinctive patch of exposed red skin crowning its head and is regarded as a symbol of longevity in East Asia. The white-flag dolphin is one of only two species of freshwater whales in the world. In 1980, a malewhite-flag dolphin was caught for the first time in the Yangtze River, which aroused great interest among dolphin researchers worldwide. China is also one of the countries with the most abundant plant life in the world. There are more than 32,000 species of higher plants, and almost all the major plants that grow in the northern hemisphere's frigid, temperate and tropical zones are represented in China. In addition, there are more than 7,000 species of woody plants, including 2,800-odd tree species. The metasequoia, Chinese cypress, Cathay silver fir, China fir, golden larch, Taiwan fir, Fujian 7

cypress, dove-tree, eucommia and camplotheca acuminata are found only in China. The metasequoia, a tall species of arbor, is considered to be one of the oldest and rarest plants in the world. The golden larch, one of only five species of rare garden trees in the world, grows in the mountainous areas in the Yangtze River valley. Its coin-shaped leaves on short branches are green in spring and summer, turning yellow in autumn. China is home to more than 2,000 species of edible plants and over 3,000 species of medicinal plants. Ginseng from the Changbai Mountains, safflowers from Tibet, Chinese wolfberry from Ningxia and notoginseng from Yunnan and Guizhou are particularly well-known Chinese herbal medicines. China has a wide variety of flowering plants; the peony, a flower indigenous to China and known as the "king of flowers," is characterized by large blossoms, multiple petals and bright colors, and is treasured as one of the country's national flowers. 6. Population China is the most populous country in the world, with 1.307 billion people by the end of 2005, about one fifth of the world's total. This figure does not include the Chinese living in the Hong Kong and Macao special administrative regions, and Taiwan Province. Moreover, the population density is high, with 136 people per sq km. This population, however, is unevenly distributed. The eastern coastal areas are densely populated, with more than 400 people per sq km; in the central areas, over 200; and in the sparsely populated plateaus in the west there are less than 10 people per sq km. The following table gives an overall view of the composition of the population of China: 8

Composition of Population (%)

male 51.5% Sex

female 48.5% cities an towns 43.0% countrysie 57.0%

Region

Age

colov 14 years old 20.3% 15-64 year old 72.0% above 65 years old 7.7%

Population and Ethnic Groups

When the People's Republic of China was founded in 1949, the population numbered 541.67 million. Owing to China's stable society, rapid development of production, improvement in medical and health conditions, insufficient awareness of the importance of population growth control and shortage of experience, the population grew rapidly, reaching 806.71 million in 1969. Since the 1970s, China has implemented a policy of family planning to control population growth which brought about the start of a decline in the birth rate. By 2005, the annual rate of population growth had decreased to 12.40 per thousand. Now China'spopulation reproduction picture has basically been turned around into one characterized by low rates of birth, death and increase. In line with the requirements of the Outline of National Economic and Social Development during the Eleventh Five-Year Program period, adopted at the Fourth Session of the Tenth NPC in March 2006, in the Eleventh Five-Year Program period 9

(2006-2010) the goal is for the average annual natural increase in China's population not to exceed eight per thousand, and for the population by 2010 to be less than 1.36 billion. 7. Ethnic Groups China is a united multi-ethnic nation of 56 ethnic groups. As the majority (91.6 percent) of the population is of the Han ethnic group, China's other 55 ethnic groups are customarily referred to as the ethnic minorities. According to the fifth national census in 2000, 18 ethnic minorities have a population of over one million, namely the Zhuang, Manchu, Hui, Miao, Uygur, Yi, Tujia, Mongolian, Tibetan, Bouyei, Yao, Korean, Bai, Hani, Li, Kazak and Dai. Of these the Zhuang ethnic group has the biggest population, numbering 16.179 million. There are 17 ethnic groups with a population of between 100,000 and one million, namely the She, Lisu, Gelo, Lahu, Dongxiang, Va, Shui, Naxi, Qiang, Tu, Xibe, Mulam, Kirgiz, Daur, Jingpo, Salar and Maonan. There are 20 ethnic groups with a population of between 10,000 and 100,000, namely Blang, Tajik, Pumi, Achang, Nu, Ewenki, Jing, Jino, Deang, Ozbek, Russian, Yugur, Bonan, Moinba, Oroqen, Drung, Tatar, Hezhen, Gaoshan (excluding the Gaoshan ethnic group in Taiwan) and Lhoba. The Lhoba ethnic group, at 2,965, has the smallest population. The Han people can be found throughout the country, mainly on the middle and lower reaches of the Yellow River, the Yangtze River and the Pearl River valleys, and the Northeast Plain. The 55 ethnic minorities, though fewer in number, are also scattered over vast areas and can be found in approximately 64.3 percent of China, mainly distributed in the border areas of northeast, north, northwest and southwest China. Yunnan Province, home to more than 20 ethnic groups, has the greatest diversity of ethnic groups in China. Over China's long history, repeated instances of ethnic 10

group migrations, opening up new land for cultivation, emigration, relocation of the ruling dynasty, and a host of other reasons, gave rise to the situation of "living together over vast areas while some living in compact communities in small areas." This continues to provide the practical basis for political, economic and cultural intercourse between the Han and the various minority peoples, and for the functioning of the regional ethnic autonomy system. 8. Spoken and Written Languages The Han people have their own spoken and written languages, namely Chinese. It is the most commonly used language in China, and one of the most commonly used languages in the world. All China's 55 minority peoples have their own languages except the Hui and Manchu who use Chinese; 22 of them have their own scripts, in which 28 languages are written. Nowadays, school classes in predominantly ethnic minority areas are taught in the local language, using local-language textbooks. Meanwhile courses are also set up to popularize Putonghua Chinese - the official national language - which is commonly used throughout the country. 9. Social Customs China's different peoples have developed individual customs regarding food, clothing and etiquette, in response to their own particular environments, social conditions and levels of economic development. Generally, the Han people take rice and flour as their staple diet, love to eat vegetables, beans, meat, fish and eggs, and pay particular attention to the art of cooking. The Uygurs, Kazaks, and Ozbeks enjoy roast mutton kebabs, flat bread and rice. Mongolians often eat beef, mutton and dairy products, and drink tea with milk. Koreans like sticky rice cakes, cold noodles and kimchi (hot pickled vegetables). Tibetans take tsampa (roasted highland barley flour) as their staple food, and drink buttered tea. The Li, Jing, Dai, Blang and Hani all chew betel nuts. The typical costume of Manchu 11

women used to be the qipao (a close-fitting dress with high neck and slit skirt). Mongolians wear traditional robes and riding boots. Tibetans love to wear waist-banded robes, and boots. Yi, Miao and Yao women wear pleated skirts, and are often bedecked with gold or silver ornaments. Uygurs wear diamond-shaped embroidered skullcaps. Koreans are known as the "white clothing ethnic group" because they favor white clothing. 10. Religious Beliefs China is a country of great religious diversity and freedom of religious belief though it is possible to mention some constraints on the exercise of religious liberties. From time to time, Beijing violates basic freedoms of different ethnic and religious minorities using the discourse of “one China”. Thus, the argument that the unity of the country is employed to disguise human rights violations merits particular attention. It has over 100 million followers of various faiths, more than 100,000 sites for religious activities, about 300,000 religious personnel and over 3,000 religious associations. These associations run 76 religious schools and colleges to train religious personnel. In China, all regular religious activities - such as worshipping Buddha, chanting scriptures, praying, expounding on scriptures, holding Mass, baptism, initiation into monk- or nun-hood, Ramadan and observance of religious festivals - are all managed by the religious personnel and adherents themselves, are protected and free from interference before the law despite the fact that there might occasionally be interferences in practice. The main religions are Buddhism, Islam, Roman Catholic and Protestant Christianity, China's indigenous Taoism, Shamanism, Eastern Orthodox Christianity and the Naxi people's Dongba religion. The Hui, Uygur, Kazak, Kirgiz, Tatar, Ozbek, Tajik, Dongxiang, Salar and Bonan peoples adhere to Islam; the Tibetan, Mongolian, Lhoba, Moinba, Tu and Yugur, to Tibetan Buddhism 12

(also known as Lamaism), and the Dai, Blang and Deang to Hinayana Buddhism. Large numbers of Miao, Yao and Yi are Catholic or Protestant Christians. Religious Han Chinese tend to practice Buddhism, Christianity, or Taoism. Buddhism was introduced into China from India around the first century AD, growing increasingly popular to become the most influential religion in China after the fourth century. Tibetan Buddhism, as a branch of Chinese Buddhism, is popular primarily in Tibet and Inner Mongolia. Now China has more than 13,000 Buddhist temples. It is probable that Islam first reached China around the midseventh century. The Yuan Dynasty (1271-1368) witnessed the zenith of prosperity of Islam. Now China has more than 30,000 mosques. Catholic influence reached China in the seventh century, and Protestantism was introduced into China in the early 19th century. Now there are more than 4,600 Catholic and over 12,000 Protestant churches, as well as over 30,000 other types of Christian places of worship in China. Taoism is based on the philosophy of Lao Zi (traditionally said to be born in 604 BC) and his work, the Dao De Jing (Classic of the Way and Virtue). It probably took shape as a religion during the second century, and China now has more than 1,500 Taoist temples. 11. History Remote Antiquity and Slave Society (1.7 million years ago-476 BC) China, one of the world's most ancient civilizations, has a recorded history of nearly 4,000 years. Fossils unearthed in Yuanmou in Yunnan Province are China's earliest primitive human discovered to date. The Neolithic Age started in China about 10,000 years ago, and relics from this period can be found all over the 13

country. Cultivated rice and millet as well as farming tools have been found in the remains of Hemudu in Yuyao, Zhejiang Province, and Banpo, near Xi'an City, Shaanxi Province, respectively. These relics date back some 6,000-7,000 years. The most ancient dynasty, the Xia Dynasty started in 2070 BC The center of Xia was the western part of modern Henan Province and the southern part of modern Shanxi Province, with a sphere of influence that reached the northern and southern areas of the Yellow River. It was in this period that slave society appeared and the next two dynasties, Shang (1600-1046 BC) and Western Zhou (1046-771 BC), saw it develop further. This era was followed by the Spring and Autumn (770-476 BC) and Warring States (475-221 BC) periods, characterized by the decline in power of the ruling house and power struggles between regional powers, marking the transition from slave to feudal society. Chinese mastered the technology of smelting bronze approximately 5,000 years ago and iron tools came into use during the Shang Dynasty, 3,000 years ago. White and color-glazed ceramics were produced. Silk production was considerably developed and the world's first jacquard silk weaving technology appeared. During the Spring and Autumn Period steel production technologies came on the scene. During the Spring and Autumn and the Warring States periods, there was a great upsurge of intellectual activity, producing many famous philosophers, such as Lao Zi, Confucius, Mencius and Mo Zi, and the well-known military scientist Sun Wu, author of the Art of War. Qin Shi Huang (259-210 BC) and His Empire In 221 BC, Ying Zheng, first emperor of the Qin Dynasty, put an end to the 250-odd years of rivalry among the independent principalities during the Warring States Period, and established the first centralized, unified, multi-ethnic feudal state in Chinese history - the Qin Dynasty (221-206 BC). He was called Qin Shi Huang or "First Emperor of Qin." He standardized the writte 14

n script, weights and measures, and currency, and established the system of prefectures and counties. The sovereigns of the next 2,000-odd years followed the feudal governmental structure established by him. He mobilized more than 300,000 people over a period of a dozen years to build the Great Wall, which stretches for 5,000 km across northern China. Qin Shi Huang had the work on his enormous mausoleum started early in his reign. The terracotta warriors and horses of the "underground army" guarding the mausoleum, unearthed in 1974, amazed the world. The 8,000 vivid, life-sized pottery figures, horses and chariots have been called the "Eighth Wonder of the World." Han Dynasty (206 BC-AD 220) and the "Silk Road” Liu Bang established the powerful Han Dynasty in 206 BC During the Han Dynasty, agriculture, handicrafts and commerce flourished, and the population reached 50 million. During his reign (140-87 BC), the most prosperous period of the Han Dynasty, Liu Che, Emperor Wudi, expanded the territory of the empire from the Central Plains to the Western Regions (present-day Xinjiang and Central Asia). He twice dispatched Zhang Qian as his envoy to the Western Regions, and in the process pioneered the route known as the "Silk Road" from Chang'an (today's Xi'an, Shaanxi Province), through today's Xinjiang and Central Asia, and on to the eastern shores of the Mediterranean. China's gorgeous silk goods were traded to the West along the Silk Road. As contacts between East and West increased, Buddhism spread to China in the first century, AD. In 105, an official named Cai Lun, synthesizing the experience of those before him, discovered a technique for making fine paper, an invention that led to a revolution in communications and learning. Tang Dynasty (618-907) After the Han Dynasty came the Three Kingdoms Period (220280), the Jin Dynasty (265-420), the Southern and Northern Dynasties (420-589) and the Sui Dynasty (581-618). These were 15

followed by the Tang Dynasty, established in 618 by Li Yuan. His son, Li Shimin, or Emperor Taizong (r. 626-649), adopted a series of liberal policies, pushing the prosperity of China's feudal society to its peak: agriculture, handicrafts and commerce flourished; technologies for textile manufacturing and dyeing, pottery and porcelain production, smelting and shipbuilding were further developed; and land and water transportation greatly improved. By the 660s, China's influence had firmly taken root in the Tarim and Junggar basins and the Ili River valley, even extending to many citystates in Central Asia. During this period, extensive economic and cultural relations were established with many countries, including Japan, Korea, India, Persia and Arabia. Song, Yuan, Ming and Qing Dynasties (960-1911) Following the Tang Dynasty came a period of almost continual warfare known as the Five Dynasties and Ten States. In 960, Zhao Kuangyin, a general of the State of Later Zhou, established the Song Dynasty (960-1279), historically known as the Northern Song Dynasty. When the Song Dynasty moved its capital to the south, historically called the Southern Song Dynasty, it brought advanced economy and culture to the south, giving a great impetus to economic development there. China in the Song Dynasty was a world leader in astronomy, science and technology and printing technology. Bi Sheng invented movable type printing, a major revolution in the history of printing. In 1206, Genghis Khan established the Mongolian Khanate. In 1271, Kublai, a grandson of Genghis Khan, conquered the Central Plains, founded the Yuan Dynasty (1271-1368), and made Dadu (today's Beijing) the capital. Kublai ended the centuries-long situation in which many independent regimes existed alongside each other, by forming one united state that brought Xinjiang, Tibet and Yunnan under its sway. During the Song-Yuan period, the "four great inventions" in science and technology of the Chinese people in ancient times - papermaking, printing, the compass and 16

gunpowder - were further developed and introduced to foreign countries, making great contributions to world civilization. In 1368, Zhu Yuanzhang established the Ming Dynasty (13681644) in Nanjing, reigning as Emperor Taizu. When his son and successor Zhu Di (r. 1360-1424) ascended the throne in 1402, he built and expanded the palaces, temples, city walls and moats in Beijing on a large scale. In 1421, he officially moved the capital to Beijing. During his reign, he dispatched a eunuch named Zheng He to lead a fleet of many ships to make six far-ranging voyages. In 1431, Zhu Di's grandson, Emperor Xuanzong dispatched Zheng He to make the seventh voyage. Passing the Southeast Asian countries, the Indian Ocean, Persian Gulf and Maldives Islands, Zheng He explored as far as Somalia and Kenya on the eastern coast of Africa. These were the largest-scale and longest voyages in the world before the age of Columbus. The Manchus of northeast China established the Qing Dynasty (1644-1911) in 1644. The best known of the Qing Dynasty

17

emperors, Kangxi (r. 1661-1722) restored the central empire's rule over Taiwan, and resisted invasions by tsarist Russia. To reinforce the administration of Tibet, he also formulated the rules and regulations on the confirmation of the Tibetan local leaders by the Central Government. He effectively administered more than 11 million sq km of Chinese territory. Modern Period (1840-1919) During the early 19th century, the Qing Dynasty declined rapidly. Britain smuggled large quantities of opium into China, making the Qing government impose a ban on the drug. In an effort to protect its opium trade, Britain launched a war of aggression against China in 1840, which led to the Qing government's signing with the British government the Treaty of Nanjing, a treaty of national betrayal and humiliation. Many countries, including Britain, the United States, France, Russia and Japan, forced the Qing government to sign various unequal treaties following the Opium War. China was gradually relegated to a semi-colonial, semi-feudal country. The Revolution of 1911 led by Dr. Sun Yat-sen was one of the greatest events in modern Chinese history, as it overthrew the Qing Dynasty that had ruled for some 270 years, ended over 2,000 years of feudal monarchy, and established the Republic of China. New-Democratic Revolution (1919-1949) The May the 4th Movement of 1919 is regarded as the ideological origin of many important events in the modern Chinese history. Its direct cause was the treaties China signed after the First World War. It also marked the introduction into China of various new ideologies, among which the spread of Marxism-Leninism is worthy of special mention. Under the influence of Russia's October Revolution of 1917, 12 delegates, including Mao Zedong, representing communist groups in different places throughout the nation, held the First National Congress in Shanghai in 1921 to found the Communist Party of China (CPC). The Chinese people led by the CPC underwent successively the Northern Expeditionary War (1924-27), the War of Agrarian 18

Revolution (also known as "Ten-Year Civil War," 1927-37), the War of Resistance against Japan (1937-45), and the War of Liberation (1946-49). Owing to the cooperation and joint resistance of the CPC and Kuomintang, the Japanese forces were defeated but shortly after the anti-Japanese war, another civil war broke out between the CPC and the Kuomintang. The three-year civil war between the CPC and the Kuomintang government lasted till 1949. The Kuomintang government was defeated. The People's Republic of China (1949- ) On October 1, 1949, in a ceremony witnessed by crowds of Beijing people in Tiananmen Square, Mao Zedong, chairman of the Central People's Government, solemnly proclaimed the founding of the People's Republic of China (PRC). During the initial post-Liberation period, the Chinese government carried out land reform in areas accounting for over 90 percent of the total national agricultural population, and 300 million peasants were granted approximately 47 million ha of land. Achievements were made during the First Five-Year Plan period, from 1953 to 1957. The average annual increase in national income surpassed 8.9 percent. China established basic industries necessary for industrialization hitherto non-existent domestically, producing airplanes, automobiles, heavy machinery, precision machinery, power-generating equipment, metallurgical and mining equipment, high-grade alloy steels and non-ferrous metals. The ten years from 1957 to 1966 was the period in which China started the socialist construction. The nation's total industrial fixed assets continued to increase between 1956 and 1966 and the national income arose by 58 percent in constant prices. The output of essential industrial products increased several times. Agricultural capital construction and technical transformation got underway. Unfortunately, the "Cultural Revolution," which lasted for ten years (May 1966-October 1976), made the state and its people suffer the most serious setbacks and losses since its founding. The Jiang Qing counter-revolutionary clique was smashed in October 1976, marking the end of the "Cultural Revolution," 19

andthe beginning of a new era in Chinese history. The CPC reinstated Deng Xiaoping, former general secretary of the CPC, to all the Party and governmental posts he had been dismissed from during the "Cultural Revolution." In 1979, China instituted a guiding policy of "reform and opening to the outside world" under Deng's leadership and the focus was shifted to modernization. Major efforts were made to reform economic and political systems. Step by step, China was establishing a road with Chinese characteristics, a road that would lead to socialist modernization. Profound changes have come about in China since the country embarked on the policy of reform and opening-up. This period is the one characterized by rapid economic advance and improved living standards. Jiang Zemin became general secretary of the CPC Central Committee in 1989 and head of state in 1993. Succeeding him, Hu Jintao took the position of general secretary of the CPC Central Committee in 2002 and president of the state in 2003. Today, the CPC Central Committee, headed by Hu Jintao, continuously upholds the policy of reform and opening-up initiated by Deng Xiaoping.

* This article was taken from the official sources of the Ministry of Foreign Affairs of the People's Republic of China.

20

The Geopolitics of China: A Great Power Enclosed

Dr. George FRIEDMAN

The Geopolitics of China: A Great Power Enclosed

The Geopolitics of China: A Great Power Enclosed*

Contemporary China is an island. Although it is not surrounded by water (which borders only its eastern flank), China is bordered by terrain that is difficult to traverse in virtually any direction. There are some areas that can be traversed, but to understand China we must begin by visualizing the mountains, jungles and wastelands that enclose it. This outer shell both contains and protects China. Internally, China must be divided into two parts: The Chinese heartland and the non-Chinese buffer regions surrounding it. There is a line in China called the 15-inch isohyet. On the east side of this line more than 15 inches of rain fall each year. On the west side annual rainfall is less than that. The bulk of the Chinese population lives east and south of this line. This is Han China, the Chinese heartland. It is where the vast majority of Chinese live and the home of the ethnic Han, what the world regards as the Chinese. It is important to understand that over a billion people live in an area about half the size of the United States. The Chinese heartland is divided into two parts, northern and southern, which in turn is represented by two main dialects, Mandarin in the north and Cantonese in the south. These dialects share a writing system but are almost mutually incomprehensible when spoken. The Chinese heartland is defined by two major rivers - the Yellow River in the north and the Yangtze in the South, along with a third lesser river in the south, the Pearl. 22

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The heartland is China's agricultural region. However - and this is the single most important fact about China - it has about onethird the arable land per person as the rest of the world. This pressure has defined modern Chinese history - both in terms of living with it and trying to move beyond it. A ring of non-Han regions surround this heartland - Tibet, Xinjiang province (home of the Muslim Uighurs), Inner Mongolia and Manchuria. These are the buffer regions that historically have been under Chinese rule when China was strong and have broken away when China was weak. Today, there is a great deal of Han settlement in these regions, a cause of friction, but today Han China is strong. Khan invaded and occupied parts of Han China until the 15 th century, when the Han reasserted their authority. Following this period, Chinese strategy remained constant: the slow and systematic assertion of control over these outer regions in order to protect the Han from incursions by nomadic cavalry. This imperative drove Chinese foreign policy. In spite of the imbalance of population, or perhaps because of it, China saw itself as extremely vulnerable to military forces moving from the north and west. Defending a massed population of farmers against these forces was difficult. The easiest solution, the one the Chinese chose, was to reverse the order and impose themselves on their potential conquerors. There was another reason. Aside from providing buffers, these possessions provided defensible borders. With borderlands under their control, China was strongly anchored. Let's consider the 23

The Geopolitics of China: A Great Power Enclosed

nature of China's border sequentially, starting in the east along the southern border with Vietnam and Myanmar. The border with Vietnam is the only border readily traversable by large armies or mass commerce. In fact, as recently as 1975, China and Vietnam fought a short border war, and there have been points in history when China has dominated Vietnam. However, the rest of the southern border where Yunnan province meets Laos and Myanmar is hilly jungle, difficult to traverse, with almost no major roads. Significant movement across this border is almost impossible. During World War II, the United States struggled to build the Burma Road to reach Yunnan and supply Chiang Kai-shek's forces. The effort was so difficult it became legendary. China is secure in this region. Hkakabo Razi, almost 19,000 feet high, marks the border between China, Myanmar and India. At this point, China's southwestern frontier begins, anchored in the Himalayas. More precisely, it is where Tibet, controlled by China, borders India and the two Himalayan states, Nepal and Bhutan. This border runs in a long ark past Pakistan, Tajikistan and Kirgizstan, ending at Pik Pobedy, a 25,000-foot mountain marking the border with China, Kirgyzstan and Kazakhstan. It is possible to pass through this border region with difficulty; historically, parts of it have been accessible as a merchant route. On the whole, however, the Himalayas are a barrier to substantial trade and certainly to military forces. India and China -- and China and much of Central Asia - are sealed off from each other. The one exception is the next section of the border, with Kazakhstan. This area is passable but has relatively little transport. As the transport expands, this will be the main route between China and the rest of Eurasia. It is the one land bridge from the Chinese island that can be used. The problem is distance. The 24

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border with Kazakhstan is almost a thousand miles from the first tier of Han Chinese provinces, and the route passes through sparsely populated Muslim territory, a region that has posed significant challenges to China. Importantly, the Silk Road from China ran through Xinjiang and Kazakhstan on its way west. It was the only way to go.

Sino-Tibetan Han (Chinese) Hui (Chinese Muslim) Tai Tibeto-Burman Miao-Yao Ýndo-Europaean Tajik Austroasiatic Mon-Khmer Korea Altaic Turkic Mongolian Tungusic Malay-Polynesian Indonesian

There is, finally, the long northern border first with Mongolia and then with Russia, running to the Pacific. This border is certainly passable. Indeed, the only successful invasion of China took place when Mongol horseman attacked from Mongolia, occupying a good deal of Han China. China's buffers - Inner Mongolia and Manchuria - have protected Han China from other attacks. The Chinese have not attacked northward for two reasons. First, there has historically not been much there worth taking. Second, northsouth access is difficult. Russia has two rail lines running from the west to the Pacific - the famous Trans-Siberian Railroad (TSR) and the Baikal-Amur Mainline (BAM), which connects those two cities and ties into the TSR. Aside from that, there is no east-west ground transportation linking Russia. There is also no north-south transportation. What appears accessible really is not. The area in Russia that is most accessible from China is the region bordering the Pacific, the area from Russia's Vladivostok to Blagoveschensk. This region has reasonable transport, population 25

The Geopolitics of China: A Great Power Enclosed

and advantages for both sides. If there were ever a conflict between China and Russia, this is the area that would be at the center of it. It is also the area, as you move southward and away from the Pacific, that borders on the Korean Peninsula, the area of China's last major military conflict. Then there is the Pacific coast, which has numerous harbors and has historically had substantial coastal trade. It is interesting to note that, apart from the attempt by the Mongols to invade Japan, and a single major maritime thrust by China into the Indian Ocean primarily for trade and abandoned fairly quickly - China has never been a maritime power. Prior to the 19 th century, it had not faced enemies capable of posing a naval threat and, as a result, it had little interest in spending large sums of money on building a navy. China, when it controls Tibet, Xinjiang, Inner Mongolia and Manchuria, is an insulated state. Han China has only one point of potential friction, in the southeast with Vietnam. Other than that it is surrounded by non-Han buffer regions that it has politically integrated into China. There is a second friction point in eastern Manchuria, touching on Siberia and Korea. There is, finally, a single opening into the rest of Eurasia on the Xinjiang-Kazakh border. China's most vulnerable point, since the arrival of Europeans in the western Pacific in the mid-19 th century, has been its coast. Apart from European encroachments in which commercial interests were backed up by limited force, China suffered its most significant military encounter - and long and miserable war - after the Japanese invaded and occupied large parts of eastern China along with Manchuria in the 1930s. Despite the mismatch in military power and more than a dozen years of war, Japan still could not force the Chinese government to capitulate. The simple fact was that Han China, given its size and population density, could not be subdued. No matter how many victories the Japanese won, they 26

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China is hard to invade; given its size and population, it is even harder to occupy. This also makes it hard for the Chinese to invade others - not utterly impossible, but quite difficult. Containing a fifth of the world's population, China can wall itself off from the world, as it did prior to the United Kingdom's forced entry in the 19 th century and as it did under Mao Zedong. All of this means China is a great power, but one that has to behave very differently than other great powers China's Geopolitical GeopoliticalImperatives Imperatives China's China has three overriding geopolitical imperatives: 1. Maintain internal unity in the Han Chinese regions. 2. Maintain control of the buffer regions. 3. Protect the coast from foreign encroachment. Maintaining Internal Unity China is more enclosed than any other great power. The size of its population coupled with its secure frontiers and relative abundance of resources, allows it to develop with minimal intercourse with the rest of the world, if it chooses. During the Maoist period, for example, China became an insular nation, driven primarily by internal interests and considerations, indifferent or hostile to the rest of the world. It was secure and, except for its involvement in the Korean War and its efforts to pacify restless buffer regions, was relatively peaceful. Inter-nally, however, China underwent periodic, self-generated chaos. The weakness of insularity for China is poverty. Given the ratio of arable land to population, a self-enclosed China is a poor China. 27

The Geopolitics of China: A Great Power Enclosed

Its population is so poor that economicdevelopment driven by domestic demand, no matter how limited it might be, is impossible. However, an isolated China is easier to manage by a central government. The great danger in China is a rupture within the Han Chinese nation. If that happens, if the central government weakens, the peripheral regions will spin off, and China will then be vulnerable to foreigners taking advantage of Chinese weakness. For China to prosper, it has to engage in trade, exporting silk, silver and industrial products. Historically, land trade has not posed a problem for China. The Silk Road allowed foreign influences to come into China and the resulting wealth created a degree of instability. On the whole, however, it could be managed. The dynamic of industrialism changed both the geography of Chinese trade and its consequences. In the mid-19 th century, when Europe - led by the British - compelled the Chinese government to give trading concessions to the British, it opened a new chapter in Chinese history. For the first time, the Pacific coast was the interface with the world, not Central Asia. This in turn, massively destabilized China. As trade between China and the world intensified, the Chinese who were engaged in trading increased their wealth dramatically. Those in the coastal provinces of China, the region most deeply involved in trading, became relatively wealthy while the Chinese in the interior (not the buffer regions, which were always poor, but the non-coastal provinces of Han China) remained poor, subsistence farmers. The central government was balanced between the divergent interests of coastal China and the interior. The coastal region, particularly its newly enriched leadership, had an interest in maintaining and intensifying relations with European powers and with the United States and Japan. The more intense the trade, the wealthier the coastal leadership and the greater the disparity between the regions. In due course, foreigners allied with Chinese coastal merchants and politicians became more powerful in the coastal regions than the central government. The worst geopolitical nightmare of China came true. China fragmented, breaking into regions, some increasingly under the control of foreigners, 28

Dr. George FRIEDMAN

particularly foreign commercial interests. Beijing lost control over the country. It should be noted that this was the context in which Japan invaded China, which made Japan's failure to defeat China all the more extraordinary. Mao's goal was three-fold, Marxism aside. First, he wanted to recentralize China - re-establishing Beijing as China's capital and political center. Second, he wanted to end the massive inequality between the coastal region and the rest of China. Third, he wanted to expel the foreigners from China. In short, he wanted to recreate a united Han China. Mao first attempted to trigger an uprising in the cities in 1927 but failed because the coalition of Chinese interests and foreign powers was impossible to break. Instead he took the long march to the interior of China, where he raised a massive peasant army that was both nationalist and egalitarian and, in 1948, returned to the coastal region and expelled the foreigners. Mao re-enclosed China, recentralized it, and accepted the inevitable result. China became equal but extraordinarily poor. China's primary geopolitical issue is this: For it to develop it must engage in international trade. If it does that, it must use its coastal cities as an interface with the world. When that happens, the coastal cities and the surrounding region become increasingly wealthy. The influence of foreigners over this region increases and the interests of foreigners and the coastal Chinese converge and begin competing with the interests of the central government. China is constantly challenged by the problem of how to avoid this outcome while engaging in international trade. Controlling the Buffer Regions Prior to Mao's rise, with the central government weakened and Han Chinaengaged simultaneously in war with Japan, civil war andregionalism, the center was not holding. While Manchuria was under Chinese control, Outer Mongolia was under Soviet control and extending its influence (Soviet power more than Marxist ideology) into Inner Mongolia, and Tibet and Xinjiang were drifting away. 29

The Geopolitics of China: A Great Power Enclosed

At the same time that Mao was fighting the civil war, he was also laying the groundwork for taking control of the buffer regions. Interestingly, his first moves were designed to block Soviet interests in these regions. Mao moved to consolidate Chinese communist control over Manchuria and Inner Mongolia, effectively leveraging the Soviets out. Xinjiang had been under the control of a regional war lord, Yang Zengxin. Shortly after the end of the civil war, Mao moved to force him out and take over Xinjiang. Finally, in 1950 Mao moved against Tibet, which he secured in 1951. The rapid-fire consolidation of the buffer regions gave Mao what all Chinese emperors sought, a China secure from invasion. Controlling Tibet meant that India could not move across the Himalayas and establish a secure base of operations on the Tibetan Plateau. There could be skirmishes in the Himalayas, but no one could push a multi-divisional force across those mountains and keep it supplied. So long as Tibet was in Chinese hands, the Indians could live on the other side of the moon. Xinjiang, Inner Mongolia and Manchuria buffered China from the Soviet Union. Mao was more of a geopolitician than an ideologue. He did not trust the Soviets. With the buffer states in hand, they would not invade China. The distances, the poor transportation and the lack of resources meant that any Soviet invasion would run into massive logistical problems well before it reached Han China's populated regions, and become bogged down - just as the Japanese had. China had geopolitical issues with Vietnam, Pakistan and Afghanistan, neighboring states with which it shared a border, but the real problem for China would come in Manchuria or, more precisely, Korea. The Soviets, more than the Chinese, had encouraged a North Koreaninvasion of South Korea. It is difficult to speculate on Joseph Stalin's thinking, but it worked out superbly for him. The United States intervened, defeated the North Korean Army and drove to the Yalu, the river border with China. The Chinese, seeing the well-armed and well-trained American force surge to its borders, decided that it had to block its advance and 30

Dr. George FRIEDMAN

attacked south. What resulted was three years of brutal warfare in which the Chinese lost about a million men. From the Soviet point of view, fighting between China and the United States was the best thing imaginable. But from Stratfor's point of view, what it demonstrated was the sensitivity of the Chinese to any encroachment on their borderlands, their buffers, which represent the foundation of their national security. Protecting the Coast With the buffer regions under control, the coast is China's most vulnerable point, but its vulnerability is not to invasion. Given the Japanese example, no one has the interest or forces to try to invade mainland China, supply an army there and hope to win. Invasion is not a meaningful threat. The coastal threat to China is economic, and most would not call it a threat. As we saw, the British intrusion into China culminated in the destabilization of the country, the virtual collapse of the central government and civil war. It was all caused by prosperity. Mao had solved the problem by sealing the coast of China off to any real development and liquidating the class that had collaborated with foreign business. For Mao, xenophobia was integral to natural policy. He saw foreign presence as undermining the stability of China. He preferred impoverished unity to chaos. He also understood that, given China's population and geography, it could defend itself against potential attackers without an advanced military-industrial complex. His successor, Deng Xiaoping, was heir to a powerful state in control of China and the buffer regions. He also felt under tremendous pressure politically to improve living standards, and he undoubtedly understood that technological gaps would eventually threaten Chinese national security. He took a historic gamble. He knew that China's economy couldnot develop on its own. China's internal demand for goods was too weak because the Chinese were too poor. Deng gambled that he could open China to foreign investment and reorient the Chinese economy away from agriculture and heavy industry and toward export-oriented industries. By doing so he 31

The Geopolitics of China: A Great Power Enclosed

would increase living standards, import technology and train China's workforce. He was betting that the effort this time would not destabilize China, create massive tensions between the prosperous coastal provinces and the interior, foster regionalism or put the coastal regions under foreign control. Deng believed he could avoid all that by maintaining a strong central government, based on a loyal army and communist party apparatus. His successors have struggled to maintain that loyalty to the state and not to foreign investors, who can make individuals wealthy. That is the bet that is currently being played out. China's Geopolitics and its Current Position From a political and military standpoint, China has achieved its strategic goals. The buffer regions are intact and China faces no threat in Eurasia. It sees a Western attempt to force China out of Tibet as an attempt to undermine Chinese national security. For China, however, Tibet is a minor irritant; China has no possible intention of leaving Tibet, the Tibetans cannot rise up and win, and no one is about to invade the region. Similarly, the Uighur Muslims represent an irritant in Xinjiang and not a direct threat. The Russians have no interest in or capability of invading China, and the Korean peninsula does not represent a direct threat to the Chinese, certainly not one they could not handle. The greatest military threat to China comes from the United States Navy. The Chinese have become highly dependent on seaborne trade and the United States Navy is in a position to blockade China's ports if it wished. Should the United States do that, it would cripple China. Therefore, China's primary military interest is to make such a blockade impossible. It would take several generations for China to build a surface navy able to compete with the United States Navy. Simply training naval aviators to conduct carrier-based operations effectively would take decades - at least until these trainees became admirals and captains. And this does not take into account the time it would take to build an aircraft carrier and carrier-capable aircraft and master the intricacies of carrier operations. 32

Dr. George FRIEDMAN

For China, the primary mission is to raise the price of a blockade so high that the Americans would not attempt it. The means for that would be land- and submarine-based-anti-ship missiles. The strategic solution is for China to construct a missile force sufficiently dispersed that it cannot be suppressed by the United States and with sufficient range to engage the United States at substantial distance, as far as the central Pacific. In order for this missile force to be effective, it would have to be able to identify and track potential targets. Therefore, if the Chinese are to pursue this strategy, they must also develop a space-based maritime reconnaissance system. These are the technologies that the Chinese are focusing on. Anti-ship missiles and space-based systems, including anti-satellite systems designed to blind the Americans, represent China's military counter to its only significant military threat. China could also use those missiles to blockade Taiwan by interdicting ships going to and from the island. But the Chinese do not have the naval ability to land a sufficient amphibious force and sustain it in ground combat. Nor do they have the ability to establish air superiority over the Taiwan Strait. China might be able to harass Taiwan but it will not invade it. Missiles, satellites and submarines constitute China's naval strategy. For China, the primary problem posed by Taiwan is naval. Taiwan is positioned in such a way that it can readily serve as an air and naval base that could isolate maritime movement between the South China Sea and the East China Sea, effectively leaving the northern Chinese coast and Shanghai isolated. When you consider the Ryukyu Islands that stretch from Taiwan to Japan and add them to this mix, a non-naval power could blockade the northern Chinese coast if it held Taiwan. Taiwan would not be important to China unless it became actively hostile or allied with or occupied by a hostile power such as the UnitedStates. If that happened, its geographical position would pose an extremely serious problem for China. Taiwan is also an important symbolic issue to China and a way to rally nationalism. 33

The Geopolitics of China: A Great Power Enclosed

Although Taiwan presents no immediate threat, it does pose potential dangers that China cannot ignore. There is one area in which China is being modestly expansionist - Central Asia and particularly Kazakhstan. Traditionally a route for trading silk, Kazakhstan is now an area that can produce energy, badly needed by China's industry. The Chinese have been active in developing commercial relations with Kazakhstan and in developing roads into Kazakhstan. These roads are opening a trading route that allows oil to flow in one direction and industrial goods in another. In doing this, the Chinese are challenging Russia's sphere of influence in the former Soviet Union. The Russians have been prepared to tolerate increased Chinese economic activity in the region while being wary of China's turning into a political power. Kazakhstan has been European Russia's historical buffer state against Chinese expansion and it has been under Russian domination. This region must be watched carefully. If Russia begins to feel that China is becoming too assertive in this region, it could respond militarily to Chinese economic power. Chinese-Russian relations have historically been complex. Before World War II, the Soviets attempt to manipulate Chinese politics. After World War II, relations between the Soviet Union and China were never as good as some thought, and sometimes these relations became directly hostile, as in 1968, when Russian and Chinese troops fought a battle along the Ussuri River. The Russians have historically feared a Chinese move into their Pacific maritime provinces. The Chinese have feared a Russian move into Manchuria and beyond. Neither of these things happened because the logistical challenges involved were enormous and neither had an appetite for the risk of fighting the other. We would think that this caution will prevail under current circumstances. However, growing Chinese influence in Kazakhstan is not a minor matter for the Russians, who may choose to contest China there. If they do, and it becomes a serious matter, the secondary pressure point for both sides would be in the Pacific region, complicated by proximity to Korea. 34

Dr. George FRIEDMAN

But these are only theoretical possibilities. The threat of an American blockade on China's coast, of using Taiwan to isolate northern China, of conflict over Kazakhstan - all are possibilities that the Chinese must take into account as they plan for the worst. In fact, the United States does not have an interest in blockading China and the Chinese and Soviets are not going to escalate competition over Kazakhstan. China does not have a military-based geopolitical problem. It is in its traditional strong position, physically secure as it holds its buffer regions. It has achieved it three strategic imperatives. What is most vulnerable at this point is its first imperative: the unity of Han China. That is not threatened militarily. Rather, the threat to that is economic. Economic Dimensions of Chinese Geopolitics The problem of China, rooted in geopolitics, is economic and it presents itself in two ways. The first is simple. China has an export-oriented economy. It is in a position of dependency. No matter how large its currency reserves or how advanced its technology or how cheap its labor force, China depends on the willingness and ability of other countries to import its goods -- as well as the ability to physically ship them. Any disruption of this flow has a direct effect on the Chinese economy. The primary reason other countries buy Chinese goods is price. They are cheaper because of wage differentials. Should China lose that advantage to other nations or for other reasons, its ability to export would decline. Today, for example, as energy prices rise, the cost of production rises and the relative importance of the wage differential decreases. At alcertain point, as China's trading partners see it, the value of Chinese imports relative to the political cost of closing down their factories wil shift. And all of this is outside of China's control. China cannot control the world price of oil. It can cut into its cash reserves to subsidize those prices for manufacturers but that would essentially be transferring money back to consuming nations. It can control rising wages by imposing price controls, but that would cause internal instability. The center of gravity of China is that it has 35

The Geopolitics of China: A Great Power Enclosed

become the industrial workshop of the world and, as such, it is totally dependent on the world to keep buying its goods rather than someone else's goods. There are other issues for China, ranging from a dysfunctional financial system to farm land being taken out of production for factories. These are all significant and add to the story. But in geopolitics we look for the center of gravity, and for China the center of gravity is that the more effective it becomes at exporting, the more of a hostage it becomes to its customers. Some observers have warned that China might take its money out of American banks. Unlikely, but assume it did. What would China do without the United States as a customer? China has placed itself in a position where it has to keep its customers happy. It struggles against this reality daily, but the fact is that the rest of the world is far less dependent on China's exports than China is dependent on the rest of the world. Which brings us to the second, even more serious part of China's economic problem. The first geopolitical imperative of China is to ensure the unity of Han China. The third is to protect the coast. Deng's bet was that he could open the coast without disrupting the unity of Han China. As in the 19 th century, the coastal region has become wealthy. The interior has remained extraordinarily poor. The coastal region is deeply enmeshed in the global economy. The interior is not. Beijing is once again balancing between the coast and the interior. The interests of the coastal region and interests of importers and investors are closely tied to each other. Beijing's interest is in maintaining internal stability. As pressures grow, it will seek to increase its control of the political and economic life of the coast. The interest of the interior is to have money transferred to it from the coast. The interest of the coast is to hold on to its money. Beijing will try to satisfy both, without letting China break apart and without resorting to Mao's draconian measures. But the worse the international economic situation becomes the less demand there will be for Chinese products and the less room there will be for China to maneuver. 36

Dr. George FRIEDMAN

The second part of the problem derives from the first. Assuming that the global economy does not decline now, it will at some point. When it does, and Chinese exports fall dramatically, Beijing will have to balance between an interior hungry for money and a coastal region that is hurting badly. It is important to remember that something like 900 million Chinese live in the interior while only about 400 million live in the coastal region. When it comes to balancing power, the interior is the physical threat to the regime while the coast destabilizes the distribution of wealth. The interior has mass on its side. The coast has the international trading system on its. Emperors have stumbled over less. Conclusion Geopolitics is based on geography and politics. Politics is built on two foundations: military and economic. The two interact and support each other but are ultimately distinct. For China, securing its buffer regions generally eliminates military problems. What problems are left for China are long-term issues concerning northeastern Manchuria and the balance of power in the Pacific. China's geopolitical problem is economic. Its first geopolitical imperative, maintain the unity of Han China, and its third, protect the coast, are both more deeply affected by economic considerations than military ones. Its internal and external political problems flow from economics. The dramatic economic development of the last generation has been ruthlessly geographic. This development has benefited the coast and left the interior - the vast majority of Chinese - behind. It has also left China vulnerable to global economic forces that it cannot control and cannot accommodate. This is not new in Chinese history, but its usual resolution is in regionalism and the weakening of the central government. Deng's gamble is being played out by his successors. He dealt the hand. They have to play it. The question on the table is whether the economic basis of China is a foundation or a balancing act. If the former, it can last a long time. If the latter, everyone falls down eventually. There 37

The Geopolitics of China: A Great Power Enclosed

appears to be little evidence that it is a foundation. It excludes most of the Chinese from the game, people who are making less than $100 a month. That is a balancing act and it threatens the first geopolitical imperative of China: protecting the unity of the Han Chinese.

* This article was previously published by The Market Oracle on June 13, 2008 under the title China's Geopolitic Imperatives and its Current Economic Position authored by John MAULDIN. It is re-published here with the permission given by John MAULDIN.

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China: Future's Superpower?

Assoc. Prof. Atilla SANDIKLI

China: Future's Superpower? Introduction China is a country drawing great attention due to its rich history, unique civilization, the largest population in the world and th recently rapidly developing economy. Until the beginning of 19 century compared with the rest of the world, China was a well developed country. However after the western industrialization, it couldn't stand against the European states which had technological development and overseas trade and experienced a rapid decline period failing to follow the transformation. China had lost some of its lands at the end of the wars with the western states, Russia and Japan and became target of the colonist and imperialist states. In terms of the balance of power in the world, some powers such as England, Germany, Japan and then USA have loomed large while China has taken a back seat. After the end of Cold War, globalization caused a new vision and new forms emerged in the world economy and politics. China, being aware of this transformation on time and taking precautions, evoked its historical, cultural and socio-economic potentials and began to rise. In accordance with the phrase of “If China wakes up one day this change can shake the world.” some other phrases such as “wakening of giant”, “dragon's sharpening his nails” and “emerging of a new superpower” are used in the international relations literature. In the history of world economy no other countries were able to grow or increase the living standards of their citizens as fast as China did in the last quarter of the century. Having left the conservative and rigid policies after Cold War, China benefited from its existing capacity and opportunities of the globalization in a realist and rationalist way. It determined new policies to benefit maximally from its own features in changing conditions and implemented these policies successfully. Thanks to this, China 40

Assoc. Prof. Atilla SANDIKLI

began to affect the balance of world not only for international trade and investment but also for determining the roles of global geopolitics and scenarios of energy safety and environment pollution and the efforts of new society engineering, as well. What was the secret of China's success? Which policies did China apply to achieve such a big leap? How could China provide against the policies of world powers which prevent China's development? What are the scenarios which China can encounter in the future? Will China be able to overcome these situations? What lessons should we take from the Chinese success? China Before and After Industrial Revolution Before Industrial Revolution, China had an important place among the other countries of the region and other states interacted, with its advanced capability and quality. Chinese goods were preferred and demanded in all markets due to their quality and widespread presence. Silk, porcelain, paper, spice, and valuable stones were some of them. Transporting these goods caused to 1 emerge of the prominent historical trade roads such as “Silk Road” 2 and “Spice Routes” . Economies of the countries on which these trade roads passed were influenced positively and the roads contributed the development of the cities and ports on these roads. 23.1% of GNP of the world was generated from China on its own in 1700 whereas 23.3% from Europe, 3.2% from Russia, 4.5% from Japan. In that time China was an important economic power. In the years when sea trade was developed, parallel to development of trade, the significant changes were seen in these rates. For example, in 1820, China's share in the world GDP increased to 32.4%. In the same year Europe's share was 26.6%, Russia's 4.8%, 3 Japan's 3% and USA's 1.8% . 1- For information about “Silk Road” see http://tr.wikipedia.org/wiki/%C4%B0pek_Yolu. Access date: 24.03.2008. 2- For information about “Spice Routes” see http://tr.wikipedia.org/wiki/Baharat_Yolu. Access Date: 24.03.2008. 3- Alaattin Kiziltan, “People's Republic of China's Possibility of Becoming Superpower In A Mono Polar World” [in Turkish], C. Unv., Magazine of the Faculty of Economics and Administrative Sciences, Volume 5, Issue 1, p. 47. http://www.cumhuriyet.edu.tr/edergi/ makale/858.pdf, Access Date: 24.03.2008.

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China: Future's Superpower?

In following years China's share in the world production began to decline rapidly whereas the shares of Europe and USA, increased after the industrial revolution. In 1890 China's share in the world GDP fell into 13.2% but Europe's share increased to 40.3%, USA's increased to 13.8%. Russia's share was in the level of 6.3% and Japan's was 2.5%. This downfall continued in the following years. After the wars, China's share bottomed out with 5.2% in 1952. In the same year USA's share increased to 23.4% while Europe's share 4 fell down 29.7%. Mao Period “Planned Economy” After the Communist Party founded People's Republic of China in 1949, it reshaped all the system according to its ideology. After 1949 two different economic development policies were applied in China. One of them was the “Planned Economy” based on the high-level centralization and applied in Mao period (19491976) and the other was “Chinese-style Socialist Market Economy” improved as a result of the reform applied in Deng Period.5 In the planned economy based on high-level centralization and applied since 1950s, financial and physical resources and technological power of the country were allocated for the important projects and the resources were distributed rationally. A basis was formed for industrialization by establishing the balance among the regional economies. In the period from 1949 to 1956 the socialist 6 transformation was implemented drastically. Between 1957 and 7 1966 socialist structuring was completed. In “Culture Revolution” starting in May 1966 and ending in October 1976 and causing serious failures and destructive losses, many incorrect applications were made in economy field as well as the other fields. The scope of economic development was expanded constantly and the economic structure became complicated gradually. Finally the deficiencies of the economic system surfaced. 4 Kiziltan, ibid., p. 47. 5 Deniz Cakiroglu, China's Country Profile [in Turkish], published by DGEME, 2006. 6 Yilmaz Altug, Chinese Issue [in Turkish], Otag Publish., Istanbul, 1977, p. 195. 7 Qin Shi, China [in Turkish], Yeni Yildiz Publish., Pekin, 1997, pp. 90-92.

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Deng Period “Chinese Style Socialist Market Economy” Following Mao's death in 1976 the Culture Revolution ended and China's share in the world production decreased to 5%s in 1978. After a short power struggle Deng Xioaping came into power. Deng refused the economy policies founded on Stalinist base which was like agricultural communes, planning of material balance, foreign trade made for closing the gaps in domestic production and price control.8 It was stated that the most important issue for China to solve was “economic development”.9 Reform began firstly in rural area. Successful applications10 in rural developments created suitable conditions for the decision of restructuring of all economic system and gained experience. In October 1984 the decision11 of Reconstruction of Economic System was taken in the 12th Central Committee meeting of China Communist Party and in the economic system urban centered phase was initiated. Amendments were done on the structure of property. Reform of price was applied and the market system was improved. A series of reforms were initiated: Planning, public finance and carrying out reforms in the banking systems and functioning of macro-economic administration incrementally, restricting the scope of the administration oriented direct planning and strengthening market's determinant role in accordance with this situation, maintaining China's foreign trade according to China's international applications and present situation. Abating subsidy on exports and import duties, decreasing the quota and compulsory license on commercial goods dramatically and ending compulsory planning for import and export, improving the system of income distribution, using different kinds of income distributions in conjunction with keeping the principle of “the 8 Mehmet Ogutcu, Raising Asia [in Turkish], Imge Kitabevi Publishing, Istanbul, 1998, p. 68. 9 Atilla Sandikli-Ilhan Gullu, “Developing Chinese Economy and Its Affects into Turkish Foreign Trade” [in Turkish], Future's Superpower: China [in Turkish], Editor: Atilla SandikliIlhan Gullu, published by TASAM, Istanbul, May 2005, p. 294. 10 The Development-Oriented Poverty Reduction Program for Rural China, Information Office of the State Council People's Republic of China, Beijing, February 2001. 11 Shi, ibid., p. 93-94.

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China: Future's Superpower?

more work the more to be paid”. These reforms caused to form socialist market economy. Implementation of “Chinese-style Socialist Market Economy” was guaranteed constitutionally by the constitutional amendments decided in the first meeting of 8th National Public th Congress held in March 1993. In the third meeting of CCP's 14 Central Committee dated November 1993, “China's Chinese-style Socialist Market Economy is related intimately to the main socialist system.”, in other words, it was decided that “the market controlled to macro extent by the state will be a functional tool for allocating .12 resources This approach became general plan and action program for China's economic structural reform. In this decision five major reform fields were determined: converting state companies into joint stock companies, accomplishing financial system reforms, implementing financial reform, improvement of investment and trade systems. In this period, a utilitarian approach was embraced, economy policies were implemented based on concrete data and instead of a unique program for all country the programs, in accordance with its own conditions, were prepared for each geographical region and economic sector. Another feature of this period was foreign capital inflow and foreign trade gaining importance. Moreover market forces were active for some goods and services and a dual pricing system was created. As applied in the entire world, restrictions were abated and all prices began to be determined according to the market forces freely. Another topic on the agenda in this period was establishment of a banking system to make surplus value taxable for both financing public institutions and to make surplus value, which arises as a result of implemented free market economy, taxable. As of 1995 China's share in the world production was doubled and reached 10.9%. Sleeping giant woke up and began to sharpen his nails. Slowing Down of Growth and Deflation Between the years of 1997-2002 it was observed that there was a slowing down in the growth and stability on prices relatively 12 ibid., p. 95.

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Assoc. Prof. Atilla SANDIKLI

Although there were many complicated reasons behind this slowness on the growth, the main reason was the lack of productivity or technological failure. When the process of reform and development began, there were no big differences in terms of productivity/technology between state economic enterprise and private enterprise. In addition to this, the supports made in this period were sufficient for the state economic enterprise to continue their activities. However as time passed the differences between these two became more significant and finally state economic enterprises became the losing side. State economic enterprises could stand up only with the state's financial supports and lowinterest bank credits. In this period the financial position of the state economic enterprises got worse and their profit rates decreased as well. While their profit rates were around 8% in 1987, they fell down to around 2% in 1994. In the first quarter of 1996 they lost money totally for the first time.13 The amount of the unpaid credits reached a large amount for banks. The reason of high debt rates was the economic growth losing speed as well as companies having difficulty in paying their debts. Therefore, when the banks refused to make term extension for pay-backs and to provide new credits they faced bankruptcy. As China had quite old production technology, local administrations were initially forced to draw foreign investment in order to cover these technological gaps. Therefore the incentives made caused an excess capacity in the country and finally growing speeds declined. This problem happened in 1996 and 1997 increased more and more owing to lack of the domestic demand and foreign demand caused by the crisis. Another reason for the excess capacity was that the domestic saving rate has increased 500% and constant pressure on prices to decrease since 1991. As a result of this, the issue of deflation became on agenda. Deflationist environment melted profit and decreased investment and this naturally slowed down the growth.14 13 Mehmet Ozan Saray-Levent Gokdemir, The Stages of Chinese Economy’s Growth [in Turkish], p. 5; http://joy.yasar.edu.tr/ makale/7.sayi/cin.pdf. Access Date: 24.03.2008 14 Saray-Gokdemir, ibid, p. 6.

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China: Future's Superpower?

In frame of the policy “support the big one and sell the small one” adopted in 1997 small unproductive state institutions were privatized, the big ones continued to stay in the control of the state depending on their economic weights. With this application, China was very different from the former Soviet Republics' collective privatization experiences and the results can be evaluated as China's success15 In China's mentioned applications, globalization winds on the world, world scale economic developments and crises play also large part. Overheating and Cooling Efforts in Economy Overheating tendencies in the economy appeared after 2003. The term of “overheating in economy” is used in case of excess demand and this demand creates an inflationist pressure. However as demand and supply in China increase simultaneously, the price increase is not a problem any more but excessive amount of investments has become a huge problem instead. The reason of excessive investments was that the government-controlled banks could not distribute efficient loans. 100% of the banking sector in China belongs to the state. The source is people's savings and all of credits go to the state economic organizations. Meanwhile bad loans consisted of 50% of the total. In such a circumstance companies continued to grow and finance processes with equity loans although they didn't make profit.16 “Cooling economy” effort which was dominant on this stage of China's economy became on agenda to prevent these bad loans and yield economy. Moreover in 2004 Prime Minister Jiabao pointed out that strong measures had to be taken to cool the economy. Following the Prime Minister's warning some limitations were made on bank credits and closer supervision on investment projects. Additionally companies had to get into less debt and to use more equity capital in order to make production. Therefore, application17 of fiscal discipline and revaluation were brought to the agenda. Emerging Chinese Economy and Rise of the New Superpower With the measures taken, China began to get out of its overheating tendency. In the following years, the economy 15 Katsuji NAKAGANE, SOE Reform and Privatization in China A Note on Several Theoretical and Empirical Issues, http://www.e.utokyo.ac.jp/cirje/research/dp/2000/2000cf95 .pdf. Access Date: 24.03 2008. 16 Gokce, Deniz and Metin Ercan, “China, Turkey and the World” [in Turkish], KarizmaQuarterly Opinion Magazine, Issue 23, Istanbul, 2005, pp. 39-50. 17 Ebru Arisoy- Guzin Bayar- Burak Soranlar (2004), The Giant of Asia: People's Republic of China, The Turkish Republic Undersecratariat of Foreign Trade, http://www.foreigntrade.gov.tr/ead/DTDERGI/temmuz2004/asya1.htm, Access Date: 24.03.2008.

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maintained 10% average annual growth rate which it has had since 1990 while the world average was around 5% in the same period. Chinese economy grew 9.3% in 2003, 9.2%18 in 2004, 10.7% in 2006, 13,1% in 2007 and 9,1% in 2008 respectively. Despite the global financial crisis stemmed from the liquidity shortage in the US banking system beginning from the middle of 2007 to 2010, the Chinese economy remained relatively resilient. As the world confronted the worst global financial crisis since the Great Depression of the 1930s, the economy of China preserved 8,7% growth rate in 2009 and 11% in the first half of 2010. It is expected that the Chinese economy will grow at least 9,5% by the end of 2010. China's GDP reached 8,7 trillion dollars and now China is the second largest economy following the USA when measured in purchasing power parity. China with its nominal GDP around 4,8 trillion dollars in 2009, is the third economy in the world after USA and Japan. China'sforeign trade volume has also showed dramatic increases in the last 30 years. Particularly, from 2002 to 2008, its foreign trade volume grew annually at an average rate of 20% in succession. While its foreign trade was 20 billion dollars in the end of 1970s, it became 475 billion dollars19 in 2000, 1760 billion dollars in 2006 and 2170 billion dollars in 2007. Due to the consequences of the global financial crisis, the increase of the foreign trade volume continued slowly reaching barely to 2207 billion dollars in 2009. However, still with respect to the figures of 2009 China is the second largest trading nation of the world following the USA. Although China is a country dependent on outside financial sources with respect to foreign investments and import, it is one of the rare countries which have budgetary surplus in the world. Its foreign trade surplus reached 297 billion dollars in 2008 and with the influence of the crisis decreased 34% to 196 billion dollars in 2009. Chinese export rose from 14 billion dollars in 1979 to around 1,4 trillion dollars in 2008 and surpassed the US in 2007 as the 18 Atilla Sandikli-Ilhan Gullu, “The Development of Chinese Economy in the Globalization Period and The Lessons To Be Taken for Turkey” [in Turkish], Future's Superpower: China, Editor: Atilla Sandikli-Ilhan Gullu, TASAM Publications, Istanbul, May 2005, p. 330. 19 The foreign trade volume in China exceeded 2 trillion dollars, http://turkish.cri.cn/281/2008/01/11/[email protected]. Access Date: 24.03.2008.

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China: Future's Superpower?

second largest exporter country in the world. Though stood at 1,2 trillion dollars export in 2009, China emerged as the biggest exporter country in the world exceeding the export volume of Germany. Germany's export volume diminished 15% in 2009 to 1,17 trillion dollars lagging behind China mainly because of the financial crisis-led shrinking export markets. The growth of the Chinese export gained momentum as the impact of the global financial crisis began to lessen. In the first half of 2010, China had an export volume of 705 billion dollars, which indicated that Beijing will preserve its leading status in terms of merchandise export. Though there was nearly no direct foreign capital in 1978, the direct foreign capital went beyond the amount of 70 billion dollars 20 in 2004. According to the last remarks by the Chinese State Administration For Industry and Commerce (SAFIC), China received 2.11 trillion dollars investment in the last 30 years. The investments have increased approximately 25% each year. Exchange 21 reserves of China went beyond 1500 billion dollars as well. As of July 2010, China holds about 2,5 trillion exchange reserves as the largest foreign holder of the US treasury securities. More than 450 thousand foreign companies in China, the member of International Monetary Fund and the World Trade Organization, are currently operating. They constitute more than the half of the China's total export. When considering that the international investments decreased more than half in the last three years and the world economy entered into recession, China's performance is impressive indeed. In line with the general macroeconomic advance of the economy and because of the relative decline of newly-born population, prosperity of the Chinese people saw considerable improvements. In the last 30 years, 400 million Chinese exceeded the poverty line and from the late 1970s to 2000, China's GDP per capita more than doubled. The GDP per capita of the Chinese 20 http://www.chinaability.com/FDI.htm. Access Date: 24.03.2008. Foreign capital inflow in 2005 is 72,4 billion dollars. 21 http://www.chinaability.com/reserves.htm. Access Date: 24.03.2008. China's Exchange reserve in 2007 is 1.528 billion dollars.

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people was less than 400 dollars in 1978 and it exceeded 800 dollars at the beginning of the new millennium. From 2000 to 2008, it reached 3000 dollars and is expected to approach to 4000 dollars by the end of 2010. The OECD economic projections display that China, still being the second largest economic power of the world according to the purchasing power parity, could be a “new economic superpower” until 2020. In one of his studies, Goldman Sachs anticipates that China will be able to reach the extent of GNP with 44 trillion dollars in 2050 unless there appear political or economic depressions or natural disasters. Along with these prospective numbers, the most recent estimates even indicate that China will have the biggest economy of the world circa 2025 surpassing the USA. If it is remembered that Chinese economy grew at an average rate of 9,5% from 1978 to present, the realization of these predictions seems possible. China's Foreign Policy Despite its raising economic power China is aware of not being a military or political superpower. For this reason it takes care not to make assertive statements in the foreign politics. Until getting enough power, China prefers to pursue a peaceful foreign policy based on the principle of “living together in peace” to keep the status quo rather than a revisionist foreign policy. For living together in peace there are 5 requirements to realize: Respect for the sovereignty and territorial integrity of the other countries, non-aggression based on the reciprocity, not interfering in the internal affairs of other states, equality and mutual benefit.22 Through this policy, China is planning to create a safe foreign politics environment for development of its economy and to expand to the world by avoiding any unnecessary tension and conflicts. To ensure the internal stability and to prevent the external interventions on fragile issues like Tibet and East Turkistan, it is stressed that it is necessary not to intervene the countries' internal affairs, to respect for their sovereignty and territorial integrity. In accordance with the principle of equality and mutual benefit it is anticipated to solve the international problems in a peaceful way. China continues to develop in accordance with its targets but not to disturb the other powers by peaceful foreign politics and avoiding extreme expressions. 22 Qimao Chen, “China's Security Conception and Its Politics” [in Turkish], Future's Superpower China, Editor: Atilla Sandikli-Ilhan Gullu, published by TASAM, Istanbul, May 2005, p. 57.

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China: Future's Superpower?

Within the context of the principle of equality and mutual benefit, having developed its relations with the great powers China is trying to prevent the attempts which are against its rapid development. In global platform, China has established strategic partnerships with Russia, USA (3

and EU and is also trying to form a regional peace belt with Japan, 24 ASEAN and APEC in Asia Pacific region and with Shanghai 25 Cooperation Organization in the east. China also pursued some revisionist politics to realize some of its targets in the foreign policy. However even implementing these policies more peaceful approaches have been predicated on. 26 Especially the politics of “one country, two systems” expanded its frontiers with Hong Kong and Macau which has been the Portugal dominion for four hundred years. These regions which have the special administrative region (SAR) and structural autonomy continue to carry out their own laws and they don't change their social and economic life styles. Moreover these regions will be able to sign dual treaties with other nations, organizations and institutions. The scenarios which state that the joining of these two developed regions to China will cause major problems proved wrong and the politics of “one country two systems” resulted in success. This development made big contributions for Chinese economy and vision. China also wishes the Taiwan issue27 to be solved by a similar system in the future. In parallel with the rapid development of economy, China's energy demand keeps increasing rapidly. China has to import half of 23 Nuraniye Hidayet Ekrem, People's Republic of China's Foreign Politics [in Turkish], published by ASAM, Ankara, 3003, p. 70. 24 Atilla Sandikli-Ilhan Gullu, “The South Asia and the Pacific Region in the Globalization and Regionalization Period” [in Turkish], Future's Superpower China, Editor: Atilla Sandikli Ilhan Gullu, TASAM Publications, Istanbul, May 2005, pp. 262-270. 25 Gokhan Teletar, “Shanghai Cooperation Organization: 21st Century's Regional/ Global magnet”, [in Turkish] Future's Superpower China, Editor: Atilla Sandikli-Ilhan Gullu, published by TASAM, Istanbul, May 2005 p. 178. 26 Cagdas Ungor, “China's Politics Of One Country Two Systems: Taiwan, Hong Kong and Macau”, Future's Superpower China, Editor: Atilla Sandikli-Ilhan Gullu, published by TASAM, Istanbul, May 2005, pp. 30-31; Stratejik Ongoru, Issue 1, published by TASAM, Istanbul, May 2004, pp. 122-123. 27 The One-China Principle and the Taiwan Issue, The Taiwan Affairs Office & the Information Office of the State Council People's Republic of China, Beijing, February 2000. 28 Energy Policy Act 2005, Section 1837: National Security Review of International Energy Requirements, the U.S. Department of Energy, February 2006, p. 22.

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its oil consumption which is 7 million barrel daily. It imports 60% of 28 its oil from the Middle East. China feels indisposed owing to USA's settlement in the natural gas resources and their access 29 roads. It tries to diversify the home countries to decrease the raising energy and the Middle East dependency and, in this context it signs treaties with various countries in Central Asia,30Africa31and Latin America.32 China's energy investments at home and abroad keep increasing. Implementing the connections of oil pipelines with the Central Asia and including Iran in these lines, China tries to minimize the sensitivity of sea access roads which have to pass through the Straits of Hurmuz and Malacca. On the other hand it has rebuilt its naval forces to provide the security of its sea trade roads and oversea interests. China continues to grow in peace and stability despite the scenarios of disintegration by the separation attempts of Tibet and East Turkistan, the war about Taiwan's joining to China, sharing the oil and natural gas resources in the sea, struggling with the neighbors and raising tension with USA on controlling the sea trade roads. Until getting enough power, China will continue to implement the present strategies and politics. Conclusion China's economic success is mainly based on the stable governments, strategic patient planning, the high rates of saving and investment, the politics of dynamic trade (government aided), investment and industry, the macro economic policies which focus on controlling the inflation and public debt, disciplined work and moral understanding based on family relations. In this way, China becomes a source of inspirationwith its alternative development model for many countries which would like to get out of the pressure of Washington Consensus. 29 Cagdas Ungor, “The Big Middle East and China” [in Turkish], Stratejik Ongoru, Issue 2, published by TASAM, Istanbul, 2004, p. 59. 30 Bulent Ugrasýz, China's Politics on the Khazar and Central Asia [in Turkish], the Magazine of Social Sciences Institute, Volume 4, Issue 3, 2002 published by Dokuz Eylul University. http://www.sbe.deu.edu.tr/yayinlar/dergi/2002sayi3PDF/ugrasiz.pdf Access Date: 24.03.2008. 31 In the last years, China visited 36 high officials in 25 African countries. The President of China Hu Jintao visited Nigeria, Morocco and Kenya and also the Prime Minister Wen Jiabao visited Egypt, Ghana, Congo Republic, Angola, South Africa, Tanzania and Uganda. http://www.bahcesehir.edu.tr/UserFiles/bulten/asyadagundem003.pdf, Access Date: 24.03.2008. 32 Deniz Gokce, China is in Latin America [in Turkish], Aksam, 13.01.2006.

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China: Future's Superpower?

In the inaugural speech of the National Public Congress, Prime Minister Wen Jiabao said that “it is time to change our model of economic growth”. In his explanation, he pointed out that the growth had deepened the gap between rich and poor and this caused tension in the society. He also added that the energy safety and ecological destruction brought heavy costs and he gave the message to abandon the understanding of “growth at any cost”. In last months Chinese economists often began to use the terms such as “balanced development”, “improvement in quality of the growth” and “economic society.” It is generally accepted that more the quality of growth increases the longer Chinese miracle lives.

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China's Growing Need of Energy and Changing Balances

Assoc. Prof. Atilla SANDIKLI

China's Growing Need of Energy and Changing Balances Introduction In the last quarter of the century, world energy consumption has increased rapidly and the volume of consumption has doubled. It is estimated that the increase will be going on in the future. Average increase rate of world energy consumption is about 2.2 % per year. This rate is in the level of 1% in the developed countries. For raising economies like China, it is over 4.5%. Therefore it is expected that the energy consumption of China will be doubled. How will this increase in China's energy consumption reflect into st the balances in the world and security strategies? Will 21 century be the century of energy? Will the energy sources be focused on geopolitical theories? High growth rates in economy and increasing living standards are the most remarkable triggers to the energy consumption. Though relatively small changes have been experienced in the usage rates of main energy sources, oil and natural gas will continue being the dominant energy sources. There is a relative increase on the usage of nuclear and renewable energy sources. While in early 2000s daily oil consumption was 75 million barrels, it is anticipated that this figure will reach 120 million barrels by 2025. In spite of the crucial increase of production in the Caspian Region, western Africa and Latin America, it is assessed that there will not be significant change in the shares and effects of member states of OPEC on oil production. Oil demand growth will increase the sensitivity of the capital raising economies, which are oil importers, against price shocks. China's Growing Need of Energy Owing to having fulfilled the economic reforms, China's recent average annual growth has been around 10%. Remarkable increase was observed in the private sector activities. Taking some precautions, Chinese economy could achieve the integration to the global economy more and more. In terms of purchasing power parity, China's gross national product is over 8,7 trillion dollars and Chinese economy is the second biggest economy in the world 54

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following USA. In terms of real exchange rates, China is the largest holder of foreign exchange reserves with an amount of 2,5 trillion dollars. According to the assumptions if there will not be any important changes in conditions, Chinese economy will get ahead of that of the USA about 2025. Using its historical commercial ability, China had increased 100 times more its foreign trade volume in the last thirty years. While the volume of Chinese foreign trade was about 20 billion US$ in the late 1970s, it reached the level of 2.207 million US$ as of 2009. Following the USA, China became the second biggest economy of the world in 2009 in terms of purchasing power parity. In parallel with the developments in economy China's presence in world energy markets has increased rapidly in the last quarter of the century. In 1985, China was both self-sufficient in terms of energy and a net exporter of raw oil, oil products and coal. In those days China's share on the world energy consumption was relatively less: 20.2% on coal production, 3.3% on oil, 0.8% on natural gas and 4.2% on hydroelectricity. In 1993 China started importing oil for the first time. Having increased rapidly, in 2003, Chinese energy consumption became 29.2% of world coal consumption, 7% of oil consumption, 1.4% of natural gas consumption and 10.5% of hydroelectricity. The energy consumption of China exceeded that of Japan with its daily oil consumption of 6.5 trillion barrels in 2003 and became the second largest oil consumer, after USA. According to the data provided by International Energy Agency, China exchangereserves with an amount of 2,5 trillion dollars. According to the assumptions if there will not be any important changes in conditions, Chinese economy will get ahead of that of the USA about 2025. Using its historical commercial ability, China had increased 100 times more its foreign trade volume in the last thirty years. While the volume of Chinese foreign trade was about 20 billion US$ in the late 1970s, it reached the level of 2.207 million US$ as of 2009. Following the USA, China became the second biggest economy of the world in 2009 in terms of purchasing power parity 1 1 Swartz, Spencer and Shai Oster, China Tops the U.S. in Energy Use: Asian Giant Emerges as No. 1 Consumer of Power, Reshaping Oil Markets, Diplomacy, The Wall Street Journal, 18.07.2010 http://online.wsj.com/article/NA_WSJ_PUB: SB10001424052748703720504575376712353150310.html.

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Since 1993 China's dependence on oil import has been 2 growing every year. For example, while China was importing only 1% of its daily oil consumption in 1993, it began to import 48% of the daily consumption in 2004.3 While the share of natural gas in China's annual total energy consumption is 3,9% in 2010, it is expected that this figure will be around 10% by 2020. China has natural gas reserves of almost 53.3 trillion cubic feet and it is again expected natural gas consumption will increase rapidly. For now, productions in the country are barely enough to meet the local demand, but when we consider the expected annual average increase rate of consumption around 7.8% between 2002 and 2025, it is clear that energy importing will be needed in the future.4 China's primary energy source is coal. In China, coal supplies 66% of total energy with 1.5 billion ton (2003) which is equal to 5 29.2% of the world consumption. These numbers show us that China is the largest coal producer and consumer in the world. There has been an increase of about 80% in coal demand in the last quarter of the century. First of the most important reasons of the increase of energy demand in China is the rapid economical growth and this growth is seen mostly at the energy intensive industries. Moreover, the growth continues on the unproductive sectors, as well. Yet the energy consumption per capita in China is still lower than the numbers in the United States and Japan. To illustrate, the energy consumption per capita in China in 2003 was 34.9 million BTU 6 whereas this number is 339.9 million BTU in the USA. At present 45% of Chinese population which is 1.3 billion is living in cities and there are 25 cities whose population is over 1 million. Since the number of people living in cities is increasing 1.4% annually, this increase will reach a level between 55% and 60% in 2020. Urbanizing population is spending energy 35 times more 2 Necdet Pamir, “Energy Needs and Strategies of the USA, the EU, Russia, and China”, What Should be the Turkey's Energy Strategy? [in Turkish], Harp Akademileri Basimevi, Istanbul, 2006, p. 24. 3 Energy Policy Act 2005, ibid. p. 3-5. 4 EIA International Energy Outlook 2005. 5 Pamir, ibid. p. 86. 6 Energy Policy Act 2005, ibid. p. 7.

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than people living in rural area.7 In connection with increasing living standards, raising middle class in the country means more consumption, more cars on roads, more travels by plane and so more energy demand. The number of houses using air conditioning 8 has gone up from 11.6% in 1990 to 61.8% in 2003. The rate of having personal vehicle has also increased between 50% and 60% in average every year.It is expected that from 2004 to 2030 the required amount of energy for land transportation will increase 4.6% each year.9 The annual number of passengers in air transportation between 1990 and 2003 has been tripled by increasing from 23.7 million to 83.7 million. According to the research conducted by Lawrence Berkeley National Laboratories, the amount of oil used for transportation is equal to 38% of total oil consumption. When transportation in 2020 is considered, it is also expected that with 2% annual increase rate this number will reach 50%.10 China has to import 3.5 million barrels of oil, almost 50% of 7 million barrels of daily oil consumption. EIA predicts that China's oil demand will continue to increase and its daily oil demand will reach 14.2 million barrels until 2025 and nearly 10.7 million of this demand will be met with imports.11 China would meet 70% of its oil import from Oman, Indonesia and Yemen until 1996 but this situation has changed dramatically in 2003. Today 16.8% of China's total oil import is from Saudi Arabia, 13.8% from Iran, 11.8% from Angola, 10.3% from Oman, 7.72% from Yemen and 4.72% from Sudan.12 Specialists estimate that this transformation will continue, the import from Asia-Pacific region will decrease dramatically, the import from Russia and Central Asiawill increase significantly. Chinese government has built oil pipelines, through which Russia and Kazakhstan sources could reach to China, to diversify 7 Bo Kong, “An Anatomy of China's Energy Insecurity and Its Strategies,” Pacific Northwest National Laboratory; November 2004, page.10. 8 Crompton, Paul and Yanrui Wu, “Energy Consumption in China: Past Trends and Future Directions” Energy Economics: Volume 27, Issue 1, January 2005, p. 195-208. 9 World Energy Outlook 2004, published by the International Energy Agency. 10 Presentation by David Fridley of Lawrence Berkeley National Lab, “China's Energy Future to 2020 Initial Results” presented to Department of Energy, November 29, 2005. 11 Energy Policy Act 2005, ibid. p. 5. 12 Energy Policy Act 2005, ibid. p. 22.

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energy sources and to provide energy security. China is planning to extend these pipelines to Middle East and Africa. Thus, China has tried to decrease the sensitivity of the Strait of Malacca on the ways of sea transportation. China has recently been signing agreements to develop oil fields and to build oil pipelines and refinery in cooperation with Iran, Sudan, Kuwait,Kazakhstan, and Turkmenistan. Moreover, recently China made investments on energy projects in North Africa, Central Asia, Latin America as well as in North America. Global Actor “China” For the purpose of being a global actor China, the new superpower, has tried to strengthen its presence in Asia, Middle East,13 Africa14 as well as in Latin America which is considered as a “backyard” of the USA. In this context, Chinese President Hu Jintao visited Brazil, Argentina and Chile and encouraged to improve the economic and commercial relations with these countries comprehensively. President initiated the projects of mining and putting into operation of natural resources such as iron, copper, chrome, and oil which are needed for Chinese economy. He has made the necessary attempts to strengthen the political and military relations. While Hu Jintao was making formal contacts in Havana as Fidel Castro's formal guest in 22- 23 November 2004, he tried to keep low profile in his visit as much as possible.15 The most important side which was unnoticed is that Beijing landed soldiers quietly on the weak spot of USA. China made Cuban leader felt that he was not alone in such a term needed most. Some observers consider that Washington has always used Taiwan as a trump card in its hands. China has established special friendly relations with Cuba which is very close to the USA to conduct a kind of balance policy as 13 Bulent Ugrasiz, Chinese Foreign Policy toward the Caspian Region and Central Asia [in Turkish], Dokuz Eylul Üniversitesi Sosyal Bilimler Enstitusu Dergisi, Vol 4, Number 3, 2002. http://www.sbe.deu.edu.tr/yayinlar/dergi/2002sayi3PDF/ugrasiz.pdf Access Date: 24.03.2008. 14 In recent years, China visited 36 high officials in 25 African countries. The President of China Hu Jintao visited Nigeria, Morocco and Kenya and also the Prime Minister Wen Jiabao visited Egypt, Ghana, Congo Republic, Angola, South Africa, Tanzania and Uganda, Access Date: 24.03.2008. 15 Kemal Yavuz, Relations-Contradictions [in Turkish], Aksam Gazetesi, 13.02.2005. http://www.aksam.com.tr/arsiv/aksam/2005/02/13/yazarlar/yazarlar156.html

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well. Nobody expected that he would speak out and it was believed that first foundations of the relation network which would be weaved patiently and delicately were laid during this visit. In a period when there was a serious tension between Cuban and Russian relations and Venezuela President Hugo Chavez, seen as “spoilt child” of Latin America, and Castro have been developing their special relations included military training, it was stated that Hu's visit has gained much more importance.16 The Chinese leader had particularly avoided to include Venezuela into his visiting schedule since he did not want to be seen as if he was in cooperation with the leaders against USA. However, having visited Beijing at the end of 2004 Hugo Chavez stressed the similarities between Simon Bolivar's country and Mao Zedong's country. Besides, the President achieved to make Beijing take a decision that Chinese Oil Company would invest in Venezuela in large quantities.17 Venezuela has exported a substantial portion of oil production to USA and was trying to decrease this dependence through China. These developments have been disturbing the USA. Also, China's direct support for Iran, Uzbekistan, Sudan, and Burma which are defined by USA as the regimes in which human rights are being violated and terrorism is supported, increases this disturbance. China's these approaches are in conflict with the USA's long-term strategic goals. China's tolerance to authoritarian regimes does not comply with the US efforts to expand democracy and develop free trade. Furthermore, the US is anxious that Chinese influence on these countries will increase if Chinese firms have more estates in these countries. China's Energy Dependence and Possible Scenarios China needs to think twice before investing at home where exploration has not been a terrific success for the last 40 years. Oil reserves in Manchuria are close to depletion. Production in Sin Kiang is limited and badly suffers from geographical enclosing, rough climate, hostility from local people and technical difficulties 16 Mehmet Ogutcu, China: the New Economic Superpower Undermining Balances [in Turkish], http://www.turktrade.org.tr/ durum/durum_ocak_2006/mehmetogutcu.html 17 Yavuz, ibid.

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of exploitation. Although the “Off-shore”18 has recently been more successful, there are still some problems with the neighboring countries. For Chinese leaders, there is thus a need to find a way out. “China's growing energy dependence” takes place as a new and warm moot point in the scenarios debated by the scholars of international relations. It is asserted that the political and strategic results of China's being a major energy consumer will be very significant. It is stressed that China is to adapt itself to the new environment rapidly to protect its interests in the energy fields. It is predicted that the Middle East and Indian Ocean will witness a major question in the future. China supplies 50% of its oil import from the Middle East. It is estimated that this figure will increase to 79% in 2020. Hence China is getting much more dependent on American security and army in the Middle East. Growing oil dependence and natural resources in the region cause Chinese foreign policy to be more focused on this region. In this frame, China recognized that its energy demand is a problem and energy safety became a central concern of its foreign policy. In this context, China began to look at the Middle East where 63% of world oil reserves and 35% of gas reserves are located. China knows that the United States is there, being thus an obstacle to Chinese long term interests. It is expected that oil consumption in the United States will increase 50% in next 20 years. It is argued that growing oil dependence and safety of energy sources may cause a possible hostility between China and USA in such a competition in order to get close to the oil-rich countries. It is mentioned that China and USA which are two major oil consumers may conflict because of the resource shortage. Whether China and USA will declare war st against each other for the resources in the first quarter of 21 century is open to discussion. 18 Offshore is the general term used to mean the production process of oil and gas on the open seas. The production platform is operated usually in two forms, shallow (<1500 ft) and deep (>1500 ft). Offshore consists of underwater wells, production platforms and pipelines that connect these plants to one another and to the coast.

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Moreover India, a developing economy, is also becoming a great and important actor in the energy world. It is asserted that India's increasing energy dependence on the Middle East may lead to tensions around the Indian Ocean between China and India. Australia also wants to be one of the key players in the field of energy. Its interests could be confronted with a growing presence of China in the South East Asia. Like many Asian countries, Australia is also trying to find ways to react far from its main lands and it is trying to keep strong ties with the United States. China has no other choice but to develop its military might, particularly its forces of projection, towards the Middle East before 2020. Although China is to be obliged to develop new naval capacities, it is still unclear if China would fulfill this in less than 15 years. To develop these tools, China needs a long-term economic growth, new revenues and technologies which, for the time being, can only be provided by two categories of countries: Western ones and Russia. Is Russia going to be the builder of future Chinese air and sea forces? Will the Russian assistance be able to make China a super air and sea force? We will get the answers in a very near future. China will eventually come to the Middle East, which is likely to happen after 2020. There are also possibilities of having competitions and strong rivalries between Asian states for the control of oil and gas in the region. The sides have determined their strategies. Today, in the direction of these strategies they are both combining their power and making their preparatory steps on the chest board. The annual report which was prepared by the US Ministry of Defense on China's military power claims that having the third largest military expenses, China threatens the powers in the USA and Asia- Pacific region by accelerating its military modernization. The report points out that China's future makes the other parts of the world extremely anxious. Chinese government retorted this report. According to the report, China has recently increased its defense expenses which are parallel to the economic development to improve the living Standards of soldiers and some old weapon systems were modernized to provide the sovereignty, territorial integrity and 61

China's Growing Need of Energy and Changing Balances

security. It was stressed that no country could interfere with the rights of China which is a sovereign state. It underlines that China's defense expenses are too low compared with USA; while in 2004 Beijing spent 25.6 billion dollars for defense; Washington spent more than 18 times, namely 456 billion dollars. On the other hand while Zhu Chengdu, the Major General in the Salvation Army in China, was talking with foreign journalists, upon a question he replied that if the US makes an attempt at a military intervention into a conflict in Taiwan, China will answer with nuclear weapons and his answer caused disturbance. The Major General Zhu stated as “his own opinion” that since China doesn't have enough power to implement conventional war against USA, it will not hesitate to use its most powerful weapons to defend their rights in Taiwan. This explanation empowered the hands of the war hawks that are holding the flag of “Chinese Threat” into the flag-staff whenever possible. According to Zhu, when such a war breaks out, China will have to accept a risk of destruction all cities in the east of Xian, and in return it will destruct hundreds of cities in the USA. Beijing supported the USA for its fight against terror after 9/11. Firstly, China became the initiator of the enterprise of “Shanghai Cooperation Organization” for the security of Central Asia and Afghanistan which is one of its foreign policy goals. However, the USA's sending its soldiers to Afghanistan, Uzbekistan and Kyrgyzstan and then taking steps for strategic defense partnership with India, strengthened suspects of the leaders in Beijing that Washington is implementing the “surrounding” strategy for China. In case of an international crisis, China feels insecure about American 7th fleet in Indian Ocean might cut the energy shipment from the Gulf; China is trying to establish a field of influence in both Middle East and Eurasia to provide energy security. China is developing strong mutual economical dependence relations with Iran, Iraq, Sudan, Oman, and Saudi Arabia. In the next 10-15 years the geopolitical view of Middle East can be transformed owing to the oil dependency relations. 62

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It seems that the superpower USA and newly superpower China both have to direct the competition, meticulously, not only in the field of economy and energy but also in military field so that there will be no unexpected surprises and the hawks in both countries will be held back. Otherwise, if a military conflict erupts this will affect deeply not only the two fighting states country but also the entire world. China and USA have different policy perspectives on the issues of the Middle East. Therefore a potential China-USA conflict on oil might emerge. In spite of that, China and USA have similar interests on sustainability of stability in the region and providing the marine security. Because of this situation it is expected that there will be no problems concerning the relations in near future. Another dangerous tension rising in the region is observed between China and Japan about the territorial claim which separates the exclusive economic zone of the two countries in the East China Sea. While Japan supports that the boundary should be the median line between the two countries, China says that its own exclusive economic zone is extended to the almost end point of continental shelf (undersea shelf). Japan declares that it reserves the right to unilateral action in case China starts running Chunxiao gas deposits. In fact Japan put its cards on the table granting Teikoku Oil Company for drilling in East China Sea on 14 July. On the next stage there seems no other choice for both countries but to codevelop the oil and gas resources in the region. Any reverse efforts will deepen the conflict which has already been increasing gradually. Conclusion Although China is evaluated as the superpower of the future in the macro economic indications and the anticipations on future, it is clear that China cannot be compared with the US in the military field, yet. Therefore, China takes care not to attempt to destabilize the current global balances before it reaches the economic maturity and reinforce its military power. It abstains from the attempts which could startle USA, Russia, Japan, and other neighbors. However China is trying to modernize its navy rapidly so that it can dominate 63

China's Growing Need of Energy and Changing Balances

open seas and intervene the overseas conflicts as it is prescribed that the future will be in the oceans and space. China has been sending satellites and manned spacecrafts to the space. China deploys a rationalist, gradual, and patient strategy which means that China knows what it wants and what is possible and what is impossible under these circumstances. Chinese government improves its relations with Japan, China's historical enemy, for mutual benefits. China makes strategic cooperation with Russia and sets to create free trade area with the ASEAN countries. China is also initiator of the projects like transporting oil and natural gas to Greek province over Myanmar to by-pass the Strait of Malacca that is extremely congested and dangerous in terms of the sea access. It is following a clever strategy to create a peace zone around itself. All these peaceful foreign policy applications seem to relieve the great powers and China's neighbors for the present. However in all over the world, countries continue to get suspicious about China's aims and goals. Especially, Taiwan, and South China Sea issues, the territorial disputes in Central Asia, the internal issues like Tibet and Eastern Turkistan, the sensitivity resulting from the growing energy dependence and nationalist expressions are the reasons which will awaken the dragon from his long winter sleep. These reasons may bring “Chinese Threat” up again as a political and military threat in middle or long run.

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China's Escalating Military Power: Global and Regional Impact

Dr. Subhash KAPILA

China's Escalating Military Power: Global and Regional Impact* Introductory Observations China's escalating military power has been in global focus for more than a decade now ever since China resorted to double-digit percentage increases in its annual defense spending. This month China's escalating military power again shot into focus with China's military budget announcement of a 17.8% increase in defense spending and the release of the United States Pentagon Annual Report to the US Congress: “The Military Power of the Peoples Republic of China.” Every year with the release of these two documents both the United States and China go through an annual ritual where the United States highlights China's increasing defense spending and military build-up is highlighted and China vehemently denounces it as a gross exaggeration of its military power. Further, China retorts that its military build-up is 'defensive' in nature and that China has no aggressive intentions and that it is engaged in a “peaceful rise”. The striking feature of China's assertive retorts on its military buildup is that China questions the American reading of its intentions. But China does not seem to have refuted or contradicted the United States reports of the build-up of its military capabilities in terms of accretion of nuclear weapons, ICBM & MRBM missiles, naval build-up, air force build-up, and build-up of its power projection capabilities. More significantly, the Chinese emphasis on space warfare and cyber warfare. Since prudent military planning the world over is based on reading of a nation's military capabilities and not intentions and that China has not contradicted US assessments of her military build-up capabilities, it would be fair to assume that China is engaged in the military build-up as assessedin US reports. This causes global strategic concern and this strategic concern arises from the arguments advanced by strategic analysts that in the absence of credible threats to China's national security, the rationale for 66

Dr. Subhash KAPILA

China's enhanced military build-up transcends the requirements of a “defensive build-up' and the magnitude of China's military build-up in peace time therefore raises suspicions of China's intentions. China's escalating military power is not solely a concern of the United States only. China's accelerated military build-up generates global concerns and regional concerns in regions that strategically border China's peripheries. Besides East Asia and Taiwan which primarily concern the United States, the vast regions of South East Asia, South Asia, South West Asia and Central Asia are impacted. Even Russia despite its strategic partnership with China cannot remain strategically unconcerned with Chinese military build-up. Similarly, NATO is no longer Europe-centric. Its military presence now extends to China's peripheries in Afghanistan, Europe is also now in Chinese ICBM ranges. It is therefore legitimate for NATO also to be strategically concerned by China's growing military power. In one sense the Pentagon Assessment of China's military power suffers from two infirmities. The first infirmity is that it is East Asia and Taiwan-centric and does not do justice in examining the “China Threat” to other critical regions of the world. They are just marginally mentioned in passing. The second infirmity that is visible in the Pentagon Assessment on China's military power is that it examines the issue with kid gloves without explicitly China as a military threat if not to United States but for a large number of countries lying on its periphery like Vietnam and India not forgetting Japan. The term “China Threat” is avoided in the Pentagon document even though lately the Director of US National Intelligence, Michael McCormick stated in a Senate hearing that “They (China) are a threat today and they would become increasingly that over time.” This paper does not intend to get bogged down in statistical data of China's accelerated military power enhancement. Such data is profusely available in open published sources. This paper shall attempt to examine China's growing military power and its strategic 67

China's Escalating Military Power: Global and Regional Impact

impact in the global and regional contexts. This will be examined under the following heads: *China's Accelerated Military Buildup: The Stimuli *China's Escalating Military Budgets: Distinctive Features *China's Military Power Enhancement: The Key Thrust Areas *China's Military Power Accretion: The Global Impact *China's Military Power Accretion: Impact on China's *Contiguous Regions and NATO *China-United States Strategic Tussle: When Does the Climax Occur? China's Accelerated Military Buildup: The Stimuli Even though no National Security Strategy Document is published by China, it is not difficult to identify the stimuli which have prompted China to go in for an accelerated military build-up in the last decade or so. The strategic stimuli that can be listed in brief as follows: * United States victory in the Cold War and loss of the Cold War's predictable global strategic templates which China adroitly exploited to her strategic advantage was disconcerting for China. * The disintegration of the Former Soviet Union as a Communist superpower and the emergence of the United States as the sole superpower were strategically traumatic for China. * United States military intervention in Iraq (Gulf War I in 1991-92) and the hi-tech 'shock and awe' blitzkrieg military campaign was militarily traumatic for China. * United States military interventions in former Yugoslavia on humanitarian grounds in the mid-1990s rattled China fearing that the same principles could be used by United States for military interventions in Tibet and Xinjiang. Further, it was militarily traumatic that another Communist state stood disintegrated by American policies. 68

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* The ease with which Taliban Afghanistan was subjugated in 2002 by awesome use of American military power and that too on China's immediate periphery further reinforced China's military fears arising from USA. * Whatever Chinese doubts of American military power that may have lingered stood shattered by Gulf War II in Iraq where once again US hi-tech integrated military power sliced through Iraq in days. * The strategic hemming-in of China both in the East and the West by United States strategic initiatives have kept China worried. China's accelerated military build-up, its military up-gradation and integrated warfare operational training dates from 1992 onwards. In every successive year the military power enhancement process has picked up more steam. The above listed strategic stimuli for China's military power enhancement were not the only factors, China's ambitions to emerge as a global power competing strategically if not confronting the Untied States has been the major underlying national ambition of China. It can be argued that even if the external stimuli listed above in the international security environment were absent, China would still have embarked on an accelerated military build-up to fulfill her national ambition of emerging as a global power. Fortunately for China, financial resources were abundantly available for the accelerated military power build-up. China has already been an “economic superpower” for a decade or so. China in no uncertain terms with such accelerated military build-up has made it clear that it intends to emerge as a “military superpower” also. China does have a well thought out strategy to achieve this aim. 'China's National Defense' Publication of 2006 spells out the follows: “China pursues a three-step development strategy in modernizing its national defense…. The first step is to lay a solid foundation by 2010, the second is to make major 69

China's Escalating Military Power: Global and Regional Impact

progress around 2020, and the third is to basically reach the strategic goal of building informatized armed forces and capable of winning informatized wars by the mid 21st Century.” The implied reference in the last sentence is unmistakable. With such a blueprint, China's military power build-up at doubledigit rate increase annually would be a constant feature. China's Escalating Military Budgets: Distinctive Features Rather than laboring on statistics, it may be more useful to highlight some distinctive features of China's escalating military buildup having examined the stimuli. Some important distinctive features emanating from the Pentagon Report and other sources are as under: * China's annual defense budget growth (inflation adjusted) has grown at the average rate of 11.8% over a ten year period 1996 to 2006. This is over the average annual GDP growth of 9.2% (inflation adjusted). * In 2007, China's military budget was announced as a 17.8% increase to stand at $ 45 billion. Later revised to a 19.47% increase. * On March 4, 2008 China announced a defense budget increase of 17.8% to stand at $59 billion. * US intelligence sources stoutly maintain that China constantly under-reports its defense budget. China's actual defense budget every year is nearly three times its publicly stated figures. * China's published defense budget figures do not reflect major categories of defense expenditures for China's strategic forces (nuclear weapons and missile arsenal), military Research & Development and China's large paramilitary forces. * For 2007, the United States computation is that actual defense spending of China was in the range of $ 97 billion to $ 139 billion as opposed to declared figure of $ 45 billion. , 70

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* China's regional neighbors rank comparatively poorly in defense spending with India at about $ 23 billion. Japan at about $ 40 billion and Russia at about $ 50 billion. China's Military Power Enhancement: The Key Thrust Areas Broadly speaking China's military power enhancement has to be viewed in two different perspectives, that is (1) In the context of Taiwan military contingency and (2) In the context of its national ambition to emerge as a military superpower. Of course in terms of military capabilities, military assets and strategic priorities, overlaps would exist. In the context of the Taiwan contingency, China seems to be militarily planning in terms of military power for the following (1) Military buildup of strategic assets and conventional forces opposite Taiwan as a political and military coercive posture (2) In case of Taiwan's unilateral declaration of independence then a Chinese full scale amphibious and air assault would be launched on Taiwan and (3) Naval and air force capabilities to deter United States military intervention to protect Taiwan. In the context of Sino-American rivalry or conflict China would be preparing for strategic nuclear deterrence against United States and develop military capabilities to make the cost of any United States military operations against China militarily prohibitive. Taking the above two together and the military information flowing out of China, it has been observed that China's key thrust areas in its military power enhancement in terms of priorities are as follows: (1) Space Warfare (2) Integrated Military Operations and Informatized Warfare (3) Power Projection incorporating all important components like Air Assault Capabilities, Amphibious Warfare and Heliborne Operations (3) Mechanized Warfare (4) Special Forces Operations (5) Cyber Warfare (6) Missile Warfare. More simply put, the key thrust areas of China in terms of power enhancement strategies and up-gradation of capabilities in terms of military hardware are being planned to cater for a United 71

China's Escalating Military Power: Global and Regional Impact

States military threat whether over Taiwan or otherwise. The Chinese aim being to blunt United States hi-tech warfare capabilities in all spectrums of warfare. China's naval expansion and modernization needs special mention as there are multiple aims that China has, namely (1) China's maritime defense (2) Break any naval blockades of China (3) Develop blue water naval capabilities for strategic influence (4) Naval capabilities to provide for energy security of China in terms of defense of sea-lanes (6) Under-water submarine warfare capabilities to deter use of American naval supremacy (7) Develop long range cruise missiles against US aircraft carriers. China's Military Power Accretion: The Global Impact The global impact can be recounted in the following terms (1) Global balance of power is upset as China's challenge to the status quo takes concrete and challenging contours (2) China's main military threat is more United States-specific and hence US supremacy as the sole super power will be threatened (3) China's cavorting with nations hostile to the United States injects an element of strategic destabilization of the global world order. The United States cannot be expected to be a silent spectator to China's growing military challenge especially in the strategic regions of the world and also in the naval dimension to America's cherished principle of the “freedom of the high seas.” Nor can USA be a silent spectator to China's political and military coercion of US allies like Japan or military threats against such allies. China is already letting it be known that in case of US military intervention in a Taiwan crisis, China will carry out missile strikes against military bases in Japan hosting US military presence. As China's military power escalates such dangers could become more pronounced prompting US counter-actions. With China's propensity to use military force in conflicts of the past and its military brinkmanship over the Hainan Island crisis recently the global strategic temperatures could rise substantially forcing smaller nations to ally with the United States for their security needs. The spin-off from the above would be that such nations would welcome US military presence in Asia to off-set the China threat. In 72

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the process, China's strategic frustration in not pushing US military presence out of East Asia in particular could lead to further Chinese military brinkmanship and costly military miscalculations against the United States. China's Military Power Accretion: Impact on China's Contiguous Regions and NATO It has been noted earlier in this Paper that the combined and cumulative effect of China's military power accretion whether in the “Taiwan-specific context” or “military superpower-specific context” will generate the emergence of a formidable military machine of China and consequently encouraging it to throw its strategic weight around especially in contiguous regions. The United States has the power – political, strategic, economic and military to deal with or neutralize the emerging 'China Threat'. The same however, cannot be said of the lesser powers in China's contiguous regions. In East Asia, the China threat looms large on Japan coupled with North Korea as China's missile surrogate. Japan independently of USA or as a close inter-connected and integrated forward military ally of USA faces a credible China military threat. In terms of impact, Japan despite the US security umbrella could be (1) Forced into an arms race. It is already visible in terms of Japan's naval build-up and (2) Seek wider strategic partnerships with Australia, Vietnam and India. In South East Asia a major flashpoint exists in the territorial disputes between China and Vietnam over the ownership of the Spratly Islands. Both China and Vietnam despite the current apparent normalization of relations are militarily way of each other. Should China become more militarily assertive on the Spratly issue, Vietnam may have to seek the military security umbrella of the United States. With a growing Vietnamese economy, one should expect Vietnam to invest in expansion and up-gradation of her naval capabilities to threaten the security of China's oil sea-lanes security in the South China Sea. Vietnam has stood up to China for over a thousand years and a militarily resurgent China should not expect that it can militarily coerce Vietnam. 73

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South Asia has been used as a prolific playground by China for strategic destabilization of India with her strategic nexus with Pakistan and Bangladesh. China and India as two major Asian powers would always be competing powers strategically and hence a boundary settlement of their territorial dispute is not possible. South Asia in 2008 presents a totally different strategic picture today as opposed to 1962 when China inflicted a military debacle on India as a result of Nehru's strategic follies, India today is economically and militarily resurgent forcing the other global powers to seek strategic partnerships with India as a counter-weight to China, politically to begin with. China's protégés in South Asia, namely Pakistan (despite its Chinese nuclear weapons and Chinese missile arsenal) and Bangladesh are virtually failed states. The impact on South Asia of China's enhanced military power would be to (1) Prompt India to assert forcefully its regional power status (2) Stir India to close its strategic and military differentials with China (3) India emerges as the pre-eminent naval power in Indian Ocean with US and Western nations support (4) Force India to play the 'balance of power' games and also the creation and exploitation of strategic counter-pressure power points against China, Tibet more specifically. South West Asia for all practical purposes is a United States preserve and China with even enhanced military power can do no more than create strategic irritants by tying up with anti-US nations in the region. Central Asia for all practical purposes needs to be counted as a Russian preserve. While Shanghai Cooperation Organization (SCO) linkages could be expected to operate between Russia and China in the region, but these would operate to a point. China military power accretions beyond a certain point could threaten Russia's traditional hold over Central Asia and then Russia could be expected to react. NATO seems to be a late entrant as an entity growingly alarmed at Chinese enhancement of military power in global terms. This arises on two counts, namely (1) Military buildup in China's Western Regions (2) NATO countries now being under Chinese ICBM strategic range coverage. 74

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China's emergence as a likely NATO adversary could in terms of impact would draw the following NATO responses (1) European countries would be disinclined to lift the ban on arms exports to China (2) NATO-US could come more closer in terms of stronger military postures on China's peripheries (3) NATO's eastward creep could become more pronounced. China–United States Strategic Tussle: When Does the Climax Occur? The China-United States strategic tussle is unlike the Cold War's USA-Soviet Union strategic confrontation. That was an ideological tussle and confrontation. The China-United States strategic tussle is markedly geostrategic, geopolitical and geo-economic. Despite the friendly rhetoric that is indulged in by China and USA, it is all superficial. Underlying all this veneer are deep strategic concerns and fears of each other. Underlying all this is also a past military conflictual record of the Korean War and the Vietnam War. The present state of relations between China and USA are acquiring the contours of a Cold War. But this Cold War unlike the first Cold War has all the chances of becoming a “Hot War” between USA and China over a host of conflictual flash-points stretching right across Asia and other strategic issues. Then does the climax occur, when the veneer gets ripped off and both China and USA finally face-off each other strategically? As part of both estimative and predictive analysis it can be said that China is unlikely to stoke a direct military confrontation (barring miscalculations arising from brinkmanship) with the United States till 2050. That is the year designated by China to reach the apex of military power enhancement to emerge as a “military superpower” capable of complete victory in an informatized war. Till then the world has to wait with abated breath as to what would be the final outcome of the ongoing China-US strategic tussle. Concluding Observations China is very fond of calculating the “Comprehensive Military Power” (CMP) of nations in precise mathematical terms. If one 75

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were to adopt the Chinese CMP template then China today stands all in terms of military power with its decade old accelerated military buildup and which is likely to continue till 2050. The world can therefore expect that the arms race by China with the United States would continue till then and thereafter. Emergence as an “economic superpower” was not a difficult task for China. Besides the economic factors operating in China's favor the global security environment factors impelled the United States and Western countries to buildup China economically in return for its quasi-strategic relationship with the USA in the late 1970's, and early 1980's against the Soviet Union. However, China's emergence as a “military superpower” against the backdrop of its propensity for military conflict over contentious issues raises strategic uncertainties and strategic concerns about China's future military directions. China has to recognize the strategic realty that in its move upwards to “military superpower” status it not only has to contend with the United States but also with a number of competing regional powers for the same power status and complicating it are its territorial disputes with them and which could complicate China's military rise. Such regional powers could be induced to gravitate towards the United States if China continues to exploit border disputes as strategic pressure points.

* This article was previously published by South Asia Analysis Group on 13 March, 2008. 76

China's Perspective and Policies on New Security Environment

Zhang ZUQIAN

China's Perspective and Policies on New Security Environment* China's overall view on the global security situation could be summarized as it follows: Although the international situation is undergoing profound changes when the world has entered the new century, peace and development remains the prevailing trends of the present era. A new world war is unlikely in the foreseeable future. But, the world is far from being tranquil. More attention should be paid to the uncertainties impeding peace and development. The grounds for this argument: Firstly, promoting economic development continue to be the mainstream policy for most countries in the world. Because of the economic globalization, economic interdependence has been deepened. The role played by global and regional economic organizations is on the increase. The armed conflicts and war, that will undermine the conditions favorable for economic development, are not in the interest of most countries. Secondly, the major powers in the world, while co-operating with and seeking support from each other, are nonetheless checking on and competing with each other. Even the US, the sole superpower in the world, needs support and co-operation from other countries on many issues. Since the terrorist attack on September 11th the co-operation among major powers have been promoted further. So far no signs have shown thatthere is any major power secretly preparing for the war against the others. The competition in the overall national strength, of which the economy accounts the largest part, is the most important way of struggle among the major powers. Thirdly, the force of peace is still prevailing over the force of war. Iraq crisis and reactions from various countries have told us that most countries hope to see the crisis could be solved peacefully. The militarily means should be preserved as the last resort. However, China also stresses that there are severe uncertainties undermining peace and development. Some elements 78

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of the current international political and economic order are unfair and impeding economic development, especially for developing countries. In many parts of the world, disputes caused by ethnic, religious, territorial and other issues take place from time to time, leading even to armed conflicts and local wars. Since the end of the cold war the non-traditional security threats such as terrorism, trans-national crimes and drug trafficking have become increasingly more important for strategic consideration. The rapid advance of military technology and the revolution in military affairs have also posed severe challenge to China's modernization program for its national defense. Some Chinese strategists argue that the gap between China and developed countries in military forces has widened rather than narrowed. China's view on the regional security situation As a country located in East Asia, China stresses the importance of the security situation in Asian Pacific region. To Beijing's view, the peace andeconomic prosperity have been largely maintained in Asian Pacific region. For most of the countries in this region, it is still their national policy priority to promote economic development and consolidate peace and stability through international dialogue and co-operation. In recent years some important progress has been achieved The Asian Pacific Economic Cooperation (APEC) is moving to closer cooperation on economic as well as on political issues. The cooperation in East Asia with 10 plus 3, that is, the ASEAN plus China, Japan and South Korea, as the major vehicle, has taken shape. China and the ASEAN have reached an agreement on establishing a free trade zone in 10 years. The cooperation for the development of the Mekong River valley is about to launch. As the relevant countries have signed the Declaration on the Conduct of the Parties in the South China, the tension cause by the territorial disputes has been obviously eased. With the overthrown of Taliban regime and the unfolding of reconstruction, one of the hot points in South Asia has been eliminated. The Shanghai Cooperation Organization has made continuous progress in building mutual trust and developing cooperative partnership as well as in anti-terrorist campaign. 79

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On the other hand, factors of uncertainty and instability still exist in Asian Pacific region. While many long-standing security problems left over from history remain unsolved, the new ones have appeared. For instance, some of the problems caused by terrorist, separatist and extremist forces have become more severe than ever. Central Asia, South Asia and Southeastern Asia have all become major fronts of international anti-terrorism campaign. The tension between India and Pakistan has note been eased yet. The process of reconciliation in Korean Peninsula is interrupted. The danger of nuclear proliferation in the Peninsula has loomed large. There is another challenge to China's security worth indicating, that is, China's sovereignty and territorial integrity is under threat posed by various separatist forces, especially in Taiwan. The authorities in Taiwan still refuse to accept One China Principle and keep on their activities to split China. At the same time some countries continue to interfere with China's internal affairs by selling advanced weapons to Taiwan or upgrading their relationship with Taiwan. China's Security Policies As a country in historic transition, China's security policies are also undergoing significant transformation. Facing various threats in the new security environment, China has made some important adjustments to its security policies. Although the goals of China's security policies have remained largely the same, the ways to accomplish the tasks have been changed to a certain extent. First of all, China has adopted new concepts of security such as comprehensive security and common security. In line with these new concepts of security, China has stressed the importance of international cooperation and coordination on security issues and committed more resources to maintain the internal and external conditions necessary for economic development and social and political stability. In terms of promoting international cooperation and coordination, China has made great efforts to stabilize and improve its relations with major powers, especially with the US. As much of its trade and other economic exchanges are carried out between 80

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China and the US as well as the US is the most capable country to cause sever impairment to China, it is extremely important for China to maintain good relations with the US. In order to reduce disputes and expand cooperation with the US, China has made her best to improve Sino-American relations, including establishment of Sino-American cooperation in international anti-terrorist campaign. As one of the important adjustments to China's policy towards the US, President Jiang Zemin declared at the APEC summit in 2001 that China does not oppose American presence in Asian Pacific region as long as it plays the constructive role. As Taiwan Question is the most important and sensitive problem between China and the US, during his American tour last year, President Jiang Zemin promised to President Bush that China would not do anything to impair American interests related to Taiwan Question while persisting in her policy of "One Country, Two Systems and Peaceful Reunification". President Jiang also expressed his hope that the US would play a constructive role on Taiwan Question. Largely because of China's relevant efforts, the Bush Administration has realized that America and China share many important common interests although there are some differences between them. The world has witnessed that SinoAmerican relations have improved rapidly since September the 11th. The second aspect of China's efforts to promote international cooperation on security issues is Beijing's policy to the neighboring countries. It is one of the important goals for China's security policy to maintain peace and stability in the areas close to China. To this end, China has made many efforts since the end of the Cold War. In his political report on the Party's Sixteenth Congress, President Jiang Zemin stressed the importance to further improve the relations with the neighboring countries. He said that China would continue to cement her friendly ties with neighboring countries and persist in building good-neighborly relationship and partnership with them. The third aspect of China's efforts to promote international cooperation on security is that China is more willing to be involved 81

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in relevant international institutions. For instance, China has done its best to consolidate and improve the global regime of arms control and disarmament. China has strictly fulfilled its obligations under these treaties such as Non-Proliferation Treaty (NPT), Comprehensive Ban of Test Treaty (CTBT), Chemical Weapons Convention (CWC), the Biological Weapon Convention (BWC), etc. In this aspect, another development is worth indicating, that is, China has committed more of its efforts to peacekeeping activities operations the UN supervision. In January 2002, China formally participated in the Class-A stand-by arrangement mechanism for UN peacekeeping operations. At present more than two hundred Chinese soldiers are implementing peacekeeping tasks in Africa. With the development of its economy and military strength, China will certainly increase its contribution to world peace. As part of its overall program for the country's modernization, China has been striving to modernize its armed forces. One of the main targets is to transform its military forces so that China could win the local but high-tech wars. But, as the economic development is still the national priority, China's efforts to modernize its national defense remain limited. In terms of the share of its military expenditure in GDP, the figure for the 2001 fiscal year was as low as 1.5 %, while the figures for the most developed countries were much higher than China. That's all for my presentation. Thank you.

* This text was taken from the presentation made by Zhang ZUQIAN at the General Staff War Colleges Command in Turkey.

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China's Security Strategy towards Japan: Perceptions, Policies and Prospects

Dr. Jian YANG

China's Security Strategy towards Japan: Perceptions, Policies and Prospects* Introduction–Cold War Relations This paper discusses China's security strategy towards Japan since the end of the Cold War. It first examines Chinese analysts' perceptions of post-Cold War Japan and then analyses China's policies towards Japan during this period. The final section of the paper attempts to explore the prospects of Sino-Japanese relations. China's perceptions of and policies towards Japan experienced a dramatic evolution during the Cold War. Immediately after the founding of the People's Republic in 1949, Chinese propaganda consistently attacked Japanese militarism and monopoly capitalism. China's concern about an attack by Japan was explicitly expressed in the Sino-Soviet security treaty of 1950.1 The major cause of the concern, however, was China's fear of the United States rather than the defeated, weak Japan.2 In the 1960s, with the split of the SinoSoviet bloc, the Soviet Union became China's biggest potential threat. Understandably, China was eager to co-exist peacefully with Japan. In fact, although the two nations had become more evenly matched by the late 1960s, neither China nor Japan defined each other as a direct security threat.3 In the 1970s, with the rapprochement between Washington and Beijing, China and Japan entered a period of 'good feelings'. The Sino-Japanese Communiqué of September 1972 formally put an end to the state of war between the two countries. The relationship was further strengthened by the signing of the Treaty of Peace and Friendship in 1978. The treaty was followed by China's military clash with Soviet ally Vietnam in early 1979 and the formal termination by China of its 30-year alliance with the Soviet Union in 1980. A friendly and stronger Japan then could help China in balancing against the Soviet Union. The Chinese leadership therefore encouraged the growth of Japanese military strength even as China's own military power 1 R. L. Jain, China and Japan: 1949-1976 (London: Martin Robertson, 1977), pp. 5-6. 2 In 1957, China declared that it would be willing to modify the provisions of the Sino-Soviet Alliance of 1950 directed against Japan in the event of Japan abrogating the Japan-US Security Treaty and securing the removal of American bases and forces from its soil. Jain, p. 22. 3 Akira Iriye, “Chinese-Japanese Relations: 1945-90”, The China Quarterly, No. 124 (December 1990), pp. 627-628.

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went through a period of retrenchment in the aftermath of the Cultural Revolution.4 This, however, does not mean China had full trust in Japan. In 1982, the two nations were in a serious controversy—the Japanese school history textbook controversy. Since then, Beijing's expression of its misgivings about the tempo and scale of Japanese armament became more and more frequent. Then, in 1985, the Yasukuni Shrine problem occurred. In the history textbook controversy, the Chinese government accused the Japanese Education Ministry of falsifying the history of Japanese militarists' aggression against China by changing the words “aggression against North China” to “total advancement to North China”.5 The Yasukuni Shrine problem was caused by Prime Minister Yasuhiro Nakasone's visit to Yasukuni Shinto Shrine in Tokyo on 15 August 1985. The shrine enshrines Japan's 2.5 million war dead, including class-A war criminal Hideki Tojo, Japan's wartime prime minister. The Chinese government denounced the visit and a series of student demonstrations took place in many big Chinese cities.6 The impact of these controversies should be seen against the background of world politics, which was undergoing fundamental changes. In 198 5 Japan replaced the United States as the world's biggest creditor. Japan's emergence as an economic and financial superpower coincided with China's perceptions of a declining United States, collapsing Soviet Union and the beginning of cooperative relations between Washington and Moscow. China's perception of Japan thus changed from a bulwark against the Soviet Union to a new multidimensional power centre.7 Japan's milestone 4 In 1979 China spent Rmb 22 billion, or 17.5 percent of its total budget, on defence expenditures. By 1987, this ratio had been reduced to 8.2 percent of the total budget. See Eberhard Sandschneider, “The Chinese Army after Tiananmen”, The Pacific Review, 3:2 (1990), p. 118. 5 For more information, see Hidenori Ijiri, “Sino-Japanese Controversy Since the 1972 Diplomatic Normalisation”, The China Quarterly, No. 124 (December 1990), pp. 644-648. See also Allen S. Whiting, China Eyes Japan (Berkeley et al.: University of California Press, 1989), pp. 46-51. The textbook controversy came back in 1986 (see Whiting, China Eyes Japan, pp. 55-60). Some Japanese scholars believe the issue was “falsely reported” or “exaggerated”. See Ijiri, p. 644. See also Tatsumi Okabe, “A Proposal for Lasting Security in East Asia”, Japan Review of International Affairs, 6:3 (Fall 1992), p. 230. 6 For more information, see Ijiri, pp. 645-651. See also Whiting, China Eyes Japan, pp. 55-60. 7 Robert A. Manning, “Burdens of the Past, Dilemmas of the Future: Sino-Japanese Relations in the Emerging International System”, The Washington Quarterly, 17:1 (1993), p. 48.

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decision of January 1987 to break its self-imposed limit of spending no more than 1 percent of its GDP on defence deepened China's concerns about Japan. 8 Perceptions Since the End of the Cold War In the years immediately after the Cold War, China had to redefine its main potential threats and Chinese strategic thinkers were unable to reach an agreement as to which country might be the primary threat. According to Chu Shulong, two major schools, of thought appeared in the early 1990s: the Soviet Union/Russian school and the east and southeast school. But Chu noted that Japan was likely to replace the Soviet Union/Russia to become the Chinese leadership's major concern.9 David Shambaugh also noted that in a meeting convened in late 1993, most (60%) Chinese strategic planners believed that Japan would become China's major rival and enemy.10 It seems the year 1996 is especially important in China's redefinition of external threat since the end of the Cold War. It is important for two reasons. First, the Taiwan Strait crisis, which followed Taiwan President Lee Teng-hui's June 1995 'private' visit to the United States, highlighted the possibility of a military clash between China and the United States over Taiwan. To show US determination against Beijing's use of force against Taiwan, the Clinton administration sent two aircraft carriers and their battle groups to waters off the Taiwan Strait in March 1996. Second, just one month after the dangerous escalation of the Taiwan Strait crisis, President Bill Clinton and Prime Minister Ryutaro Hoshimoto held a summit meeting in Tokyo and signed the US-Japan Joint Declaration on Security-Alliance for the 21st Century. The declaration alarmed the Chinese and they have subsequently expressed their serious concerns about Japan's future role in the alliance. The Chinese fear that Japan's redefined role will dramatically strengthen the Japanese military. 11 8 The Nakasone cabinet approved a defence budget amounting to 1.004 percent of GDP, overturning a 12-year-old cabinet decision not to exceed 1 percent. 9 Chu Shulong, “The PRC Girds for Limited, High-Tech War”, Orbis, 38:2 (Spring 1994), pp. 180-183. 10 David Shambaugh, “The Insecurity of Security: The PLA's Evolving Doctrine and Threat Perceptions Towards 2000”, Journal of Northeast Asian Studies, 13:1 (Spring 1994), p. 6. 11 Liu Jiangyong, “The United States and Japan Rebuild Their Post-Cold War Alliance”, Shijie Zhishi (World Knowledge), No. 9, 1996, pp. 2-5; Jin Xide, “The Turning Point of the US-Japan Alliance”, Liaowang (Outlook), No. 18, 1996, p. 43.

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The Taiwan Strait crisis and the joint declaration as well as subsequent revision of the 1978 Guidelines for US-Japan Security Cooperation strengthened China's suspicion of US motives on Taiwan and, in the longer term, US strategy towards a rising China. In this sense, the United States has emerged as a primary concern. However, to most Chinese, the United States is more a challenge, a competitor than a threat. A basic assessment is that “in short and medium terms the United States will not publicly challenge the overall integrity of our territory and sovereignty by using forces”.12 Chinese perception of a powerful yet less threatening United States is determined by historical, cultural, geographical and other factors, which are beyond the examination of this paper. Chinese perception of Japan is more complicated. While many Chinese analysts believe that the upgraded US-Japan security alliance is a major step for the United States to strategically contain China, they are more concerned about Japan's greater role in the alliance. As noted by Thomas J. Christensen: “Although they [Chinese analysts] harbour suspicion toward the United States, they view Japan with even less trust and, in many cases, with a loathing rarely found in attitudes toward America.” 13 The Chinese concerns are generated by a number of factors. Geopolitics is an obvious one. Unlike the United States, Japan is a neighbour of China. A) less direct factor is US policy towards China andthe region. Generally speaking, Chinese analysts believe US policy towards China is a double strategy of both engaging and guarding against China (jiechu jia fangfan).14 They are concerned that in an effort to guard against China the United States is asking Japan to assume the role of the sword in Asia. But the two factors most widely discussed among Chinese analysts are the historical legacy and Japan's military capabilities. 12 Chu Shulong and Wang Zaibang, “Some Thoughts on Several Major Issues about International Situation and Our External Strategy”, Xiandai Guoji Guangxi (Contemporary International Relations), No. 8, 1999, p. 5. 13 Thomas J. Christensen, “Chinese Realpolitik”, Foreign Affairs, 75:5 (September-October 1996), p. 41. 14 Chu and Wang, p. 4. Chinese analysts have observed that current US strategy of guarding against China is different from the containment strategy of the 1950s and 1960s in that current strategy is a long-term strategy of building “firewalls” whereas the old one was to encircle China with direct military actions. See Guo Zhenyuan, “The Second Clinton Administration's China Policy”, Heping yu Fazhan (Peace and Development), No. 3, 1997, pp. 44-47; Chu and Wang, p. 5.

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The Historical Legacy Japan's aggression and atrocities committed in China in the first half of the 20th century continue to bedevil Sino-Japanese relations. The Chinese tend to note that Japan has not adequately acknowledged and apologised for its aggression and atrocities. An analyst argued in 1991 that “Japan still owes to the world a serious, exhausting soul-searching over its past record of aggression, with a handful of neo-fascists at home still running wild trumpeting for revival of militarism.”15 Although Prime Minister Tomiichi Murayama in 1995 for the first time used the word 'apology' in his statement about Japanese aggression,16 the Chinese tend to emphasise the facts like the Japanese Diet's failure to pass a resolution apologising for Japan's wartime crimes and the refusal of Japan to offer a full, written apology during Chinese President Jiang Zemin's landmark visit to Japan in November 1998.17 They find their dissatisfaction has been further justified by the sharp contrast between Japan's attitude towards the past and that of Germany.18 The Chinese today remain acutely sensitive to any effort, which they believe attempts to deny, cover or beautify historical facts, such as history textbook controversies and official visits to the Yasukuni Shrine. Closely related to the historical legacy is Chinese fear of Japan's nationalism, which once contributed to a militaristic Japan 15 Chen Zhuang, “Japan: A Bumpy Road to 'Big Power Diplomacy'”, Contemporary International Relations (published by China Institute of Contemporary International Relations, No. 9, May 1991), pp. 7-8. 16 In his statement, Murayama said that Japan “through its colonial rule and aggression, caused tremendous damage and suffering to the people of many countries, particularly to those of Asian nations. In the hope of that no such mistake be made in the future, I regard, in a spirit of humility, these irrefutable facts of history, and express here once again my feelings of deep remorse and state my heartfelt apology.” See Seiichiro Takagi, “China as an 'Economic Superpower': Its Foreign Relations in 1993”, Japan Review of International Affairs, 8:2 (Spring 1994), p. 109; Itaru Umezu, “Japan Has Faced Its Past”, Far Eastern Economic Review, 10 August 2000, p. 30. 17 In 1995, Murayama tried in vain to get a forthright apology from the Diet. Drafters of the resolution replaced the word “apology” with “hansei” (remorse) and “aggressive acts” with “aggressive-like acts.” Legislators also ascribed the acts in question to all countries, not just Japan. Even so, only 230 members of the 511-seat chamber voted for the measure. In China, the resolution has done more harm than good. See Nicholas D. Kristof, “The Problem of Memory”, Foreign Affairs, 77:6 (November-December 1998), p. 40; Wang Guotai, “A 'Resolution' Which Does Not Distinguish between Right and Wrong”, Renmin Ribao (People's Daily), 27 July 1995. 18 Liu Jiangyong, “Why Can't Japan Face up to Its Aggressive History?”, Liaowang, No. 33, 1995, pp. 39-40; Lin Zhibo, “Why Can't Japan Sincerely Self-Examine Its Aggressive War: A Comparison of Germany and Japan”, Kangri Zhanzheng Yanjiu (The Anti-Japanese War Studies), No. 3, 1995, pp. 190-94.

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Chinese analysts believe that nationalism had always been a rather strong undercurrent in Japan and this undercurrent started to emerge in the early 1980s. It is in the early 1980s that Japan agreed to take responsibility for its air space and sea-lanes out to 1,000 nautical miles beyond its territory.19 By the late 1980s, some Chinese analysts observed, past Japanese constitutional restraints on military activity had gradually become “dead letters”.20 This, they argued, was due to “the nationalist ideological trend running wild”.21 The end of the Cold War in the early 1990s, and Japan's economic difficulties in recent years, as well as the rise of China have further contributed to the growth of Japanese nationalism.22 To the Chinese, the election of Shintaro Ishihara as governor of Tokyo in April 1999 seemed to have confirmed their fear of Japan's growing nationalism.23 As a fiery nationalist, Ishihara co-authored The Japan That Can Say No. He is well known for urging Japan to stand up to the United States and China. Still in the shadow of the past, Chinese analysts are concerned about Japan seeking a greater political role in world politics. They note that fromYasuhiro Nakasone in 1983 and Noboru Takeshita in 1988 to Toshiki Kaifu in 1991, Japanese prime ministers have consistently emphasised the desire of Japan playing a greater political role. 24 With the collapse of the Soviet Union, that desire has become ever clearer and stronger.25 Japan's strategy of getting out of the United States and returning to Asia is believed one major step towards this direction. The essence of the strategy is believed to 19 The idea of Japan guarding the sea-lanes in the radius of 1,000 nautical miles from the Japanese coast was proposed by Prime Minister Zenko Suzuki. It was Prime Minister Yasuhiro Nakasone, however, who really pushed the idea forward. See G. V. C. Naidu, “Japan and the Asia-Pacific Region”, Strategic Analysis, 16:11 ( February 1992), p. 1308. 20 As cited in Jonathan D. Pollack, “The Sino-Japanese and East Asian Security: Patterns and Implications”, The China Quarterly, No. 124 (December 1990), p. 720. 21 Pollack, p. 720. 22 Zhu Chunlin and Wang Fang, “Guarding against the Rise of Rightist Forces in Japan”, Zhongguo Guoqing Guoli (China's National Situation and Power), No. 4, 1999, pp. 6-7. 23 Jin Xide, “The Potential Impacts of Ishihara Being Elected Governor of Tokyo”, Dangdai Yatai (Contemporary Asia-Pacific Studies), No. 5, 1999, pp. 11-13. 24 Yang Shaoxian, “Facing the 21st Century: Japan's Internationalisation and Dilemmas”, Shijie Jingji yu Zhengzhi (World Economy and Politics), No. 3, 1999, p. 30. 25 Liu Jiangyong, Kua Shiji de Riben (Japan Over The Century-End), (Beijing: Shishi Chubanshe, 1995), pp. 342-50.

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be “dominating Asia” economically and politically.26 In the eyes of Chinese analysts, Japan's effort to play a greater political role is an attempt to fill the “power vacuum” created by the withdrawal of the United States and the former Soviet Union from the region.27 What worries the Chinese is that to play a greater political role Japan will have to rely on not only its economic strength but also its military power. Some analysts have long believed that “there are powerful domestic forces in Japan which seek reassertion of Japan's military role”.28 To these analysts, there are various signs indicating Japan's determination to be involved in international affairs through military activities. For example, “to make a contribution to the international society” started to appear in Japan's annual Defence White Paper in 1991. The revision of the guidelines for US-Japan defence cooperation is regarded as one of the “new measures” for Japan becoming a political power. 29 It should be noted that Beijing often uses the historical legacy to whip up nationalism in an effort to shore up its support and that Chinese media reports on Japan could be biased. For example, in the textbook issue, most Chinese have the impression that the words like “invasion of China” have been changed to “advance into China” in all Japanese history textbooks. They may not be aware that there are a number of official history textbooks 33 according to a Japanese diplomat) currently used in Japanese schools.30 Some of these textbooks are rather straightforward on Japan's invasion of China. However, to say the Chinese people are simply manipulated by their government underestimates their genuine concerns about Japan. Media reports should not be dismissed as pure propaganda. 26 Ding Yingshun, “A Change in Japan's Diplomacy: The Aim of 'Returning to Asia'”, Riben Wenti Yanjiu (Study of Japanese Affairs), No. 1, 1996, pp. 27-30; Xu Shigang, “An Analysis of Japan's Strategy of 'Getting out of the US and Returning to Asia'”, Riben Yanjiu (Japanese Studies), No. 4, 1996, pp. 48-53. 27 Yang Shaoxian, p. 30; Shi Junwei, p. 43. 28 As cited in Robert Delfs, “China Sees Danger from Japan, Soviet Union: A Two-Front Threat”, Far Eastern Economic Review, 13 December 1990, p. 30. 29 Guo Yajie and Xiang Dongmei, “Hashimoto Government's New Measures for Becoming A Political Power”, Dangdai Shijie yu Shehui Zhuyi (Contemporary World and Socialism), No. 1, 1998, pp. 52-53. See also Li Genan, “A Big Change in Japan's Stance on Asian Security Measures”, Waiguo Wenti Yanjiu (Foreign Affairs Studies), February 1993, p. 26; Ren Yi, “Japan Wants to be a Political Power”, Waijiao Xueyuan Xuebao (Journal of Institute of Foreign Affairs), February 1992, pp. 44-47; Zhou Jihua, “Some Thoughts about the International Environment and Security in Asia-Pacific”, Riben Xuekan (Journal of Japanese Studies), March 1993, pp. 1-10. 30 Umezu, p. 30.

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In fact, the issue would be much simpler if it were simply a propaganda problem. The unfortunate fact is that Japan still has a long way to go in facing up to the past. For instance, although a number of official history textbooks are available in Japan, some of the most widely used textbooks do not use the word “invasion” in referring to the Japanese military actions against China in the 1930s.31 Furthermore, the Chinese concern about the education of Japanese youths seems to be justified by some surveys suggesting that half or more Japanese youths still see Japan as a victim rather than an aggressor in World War II.32 It is widely agreed that Japanese youths today know little about the war.33 Japan's Military Capabilities The past might not be that important if Japan were not so powerful. As Barry Buzan pointed out: “One has to ask . . . how much of this sensitivity is actually to do with the war and how much of it simply uses the symbolism of the war to reflect more contemporary worries.”34 Japan is an economic superpower and its military, Chinese observers believe, is much stronger than it appears. Chinese analysts tend to stress that Japan's Self-Defence Force (SDF) is the best-equipped military force in Asia and that Japan's defence spending is more than US$50 billion, the second highest in the world.35 The high proportion of officers in Japan's otherwise small force is seen as giving Japan the ability to expand rapidly in wartime. A military observer claims in China's official newspaper Renmin Ribao (People's Daily) that while people are often 31 Of the two most widely used middle school history textbooks for academic year 1997, the one used by 41 percent of middle schools used the word “advance” and the one used by 19 percent of middle schools used the word “invasion.” Of the two most widely used high school history textbooks for academic year 1998, the one used by 38 percent of high schools used neither “invasion” nor “advance”, but “expansion” and “escalate”; the one used by 7 percent of high schools used the word “invasion.” See “Japanese Textbook Treatment of the Nanking Massacre”, Japan Echo, 25:4 (August 1998), p. 60. 32 Charles Smith, “Japan—The Textbook Truth”, Far Eastern Economic Review, 25 August, 1994, p. 26; Sina Daily News (Chinese), 16 August 2000 (http://dailynews.sina.com.cn). 33 “Youths' Awareness of War Fades”, Asahi Shimbun (Web version), 16 August 2000. 34 As cited by Naidu, p. 1301. 35 “Understanding Japan's 2000 White Paper on Defense”, Jiefangjun Bao (PLA Daily), 3 August 2000. Japan's defence expenditures rose from the equivalent of US$29.3 billion in 1985 to US$50.2 billion a decade later. Sonni Efron, “U.S., Japan to Unveil New Defense Plans”, Los Angeles Times, 21 September 1997, p. A-14.

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astonished at US advanced weapons, they do not know that the weapons of Japan's SDF are by no means inferior to those of the United States and European powers. People have no way to know this because Japan's weapons have never been tested through actual combat or sold overseas. What Japan's military really has “is more than its fame”.36 Japan's substantial conventional military capabilities led a Chinese analyst to conclude in the early 1990s that “Japan's military power has gone far beyond the necessity of territorial defence.”37 In the mid-1990s, another military observer noted that Japan had “speeded up its pace of becoming a military power”.38 So much so that an observer believed in February 2000 that Japan's military power had surpassed that of Great Britain, an island nation similar to Japan.39 What is more, many Chinese analysts warn that evolution of the regional and international situation, such as North Korea's alleged nuclear capabilities, could compel Japan to develop nuclear weapons.40 The changes of Japanese defence concepts have also caused concerns. It was observed before 1996 that Japanese defence concepts had evolvedsteadily from “homeland defence”, which required strictly limiting defence to Japan's soil and passively meeting an enemy attack, to actively preparing for a war in the 36 “The TMD System is Stirring up Trouble in East Asia”, Renmin Ribao, 27 August 1999, p. 2, carried in FBIS-CHI (Web version, Article Id: FTS19990903000003). 37 Li Genan, p. 26. 38 Liu Zhenying, “Japan Has Speeded up Its Pace of Becoming A Military Power”, Guoji Zhanwang (International Outlook), No. 12, 1996, p. 15. See also Tong Xin, “Japan's Tendency towards A Military Power”, Liaowang, No. 38, 1996, pp. 44-45. 39 Li Zhiwei, “The Expanding Japanese Military Forces”, Guangming Daily, 23 February 2000. 40 The North Korea nuclear threat led Japan to publicly not to rule out the possibility of becoming a nuclear power at the G-7 summit of July 1993. The Chinese may find other reasons for being concerned. Early in 1957, Japanese Prime Minister Nokasuke Kishi stated, “Depending on future developments in nuclear weaponry, I do not think the Constitution bans nuclear weapons if they are of a defensive character.” [As cited by Manning, pp. 50-51.] This view was reaffirmed in Japan's 1970 White Paper on Defence which stated: “We may regard it possible legally [sic] to possess small nuclear weapons, if they are of the minimum amount necessary for defence and they do not pose a threat of aggression to other countries.” [As cited by Savita Datt, “Japan: On the Nuclear Option Threshold”, Strategic Analysis, 16:3 (June 1993), p. 286.] Reportedly former Prime Minister Miyazawa sad “Japan cannot rule out the possibility of possessing [nuclear] weapons.” [Jeremy Hall, “Will Japan Go Nuclear?”, New Zealand International Review, 22:6 (November-December 1997), p. 13.] Jeremy Hall also notes that Japan is the only nation still seeking to develop a nuclear industry based on plutonium despite the fact that it is more economical to use enriched uranium. Japan currently possesses a large amount of plutonium. In October 1999, Shingo Nishimura, Japan's defence vice-minister, suggested in an interview that Japan should scrap its decades-old ban on nuclear weapons. Although Nishimura was forced to resign, the Chinese may not forget the event easily.

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hope of achieving victory early in a war. The idea of annihilating the enemy on the beaches had been replaced by the idea of annihilating the enemy at sea. Further, the concept of combat in coastal waters had become combat on the high seas.41 The changes contributed to the first major revision in twenty years of Japan's defence policy in 1995. 42 China's concerns about Japan's defence concepts have dramatically increased since the 1996 Clinton-Hashimoto joint declaration on the bilateral security alliance. Chinese perception is that the declaration and the subsequent revision of the Guidelines have shifted Japanese involvement from a defensive to an offensive role, a clear indication of Japan becoming a military power. The Japanese Diet's approval of the revised guidelines in May 1999 meant that for the first time Japan is now legally free to support US armed forces and participate in combat operations outside of Japanese borders, giving Japan an opportunity to ease the constraints on the use of military power. The revised guidelines require the two countries to cope jointly with “situations in areas surrounding Japan”. Officials on both sides have clarified that this is a “situational” rather than a “geographical” concept, that the boundaries of the areas will depend on the nature of the situations. This “situational” definition worries the Chinese. Specifically, Chinese analysts are concerned about the revised guidelines and related measures in four aspects. First,43 in Japan-US-China triangular relations, Japan intends to sacrifice Chinese security interests for Japan-US relations. The reason is that all military alliances must have an imaginary enemy and it seems the Japan-US alliance is taking China as its imaginary enemy. Second, the revised guidelines and related measures do not exclude Taiwan in their scope. There is therefore a hidden danger of strategic 41 Lu Baosheng, “Be Vigilant: Japanese Militarism Is Resurrecting”, Renmin Luntan (People's Forum), No. 2, 1997, p.p. 36-37. See also Pollack, p. 720. 42 Wang Chunyin, “A Major Readjustment in Japan's Defence Policy”, Wanguo Wenti Yanjiu, No. 2,1996, pp. 4-5. 43 The measures include the Law Concerning Measures to Ensure the Peace and Security of Japan in Situations in Areas Surrounding Japan (the Law Ensuring Peace and Security in Situations in Areas Surrounding Japan for short), which went into force on 25 August 1999; the Agreement to Amend the Acquisition and Cross-Servicing Agreement, which went into force on 25 September 1999; and the Amendment to Article 100-8 of the Self-Defence Forces Law, which went into force on 28 May 1999.

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conflicts between China and the US-Japan alliance. Third, the revised guidelines are transforming the Japan-US military alliance into an Asian version of NATO. Although Japan's roles will mainly be to provide logistics and rear-area support, Japan is actually “sailing out in a borrowed boat”. Therefore, Japan's policies of “homeland defence” and “not to be a military power” no longer exist. Finally, the revised guidelines and related measures have strengthened domestic demands for revising Japan's constitution.44 It has become increasingly likely that Japan will further strengthen its military and steer away from “the path of peace”. 45 Japan's agreement in September 1998 to research theatre missile defence (TMD) jointly with the United States is a more immediate concern for the Chinese. Missile defence systems pose a particular threat to China because its armed forces are relatively strong in missiles but weak in other kinds of weapons. Without dismissing the threat to Japan from North Korea Chinese analysts believe that TMD is also designed to counter China's missile capabilities. “China cannot help being concerned about (Japan's) military intention of 'killing two birds with one stone'”, a Chinese analyst said.46 In fact, an analyst claims that: “Japan's every major military movement since the end of the Cold War has been 44 Article 9 of The Constitution of Japan (often known as Peace Constitution) states: “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.” http://home.ntt.com/japan/constitution/english-Constitution.html 45 For the points in this paragraph, see, for example, Zhongguo Tongxun She, “PRC Research Fellow Views Japan's Military Strategy”, 7 September 1999, carried in FBIS-CHI (Web version, Article Id: FTS19990908000951); Zhu Feng, “Measures Related to the Guidelines of Japan-US Security Cooperation and Japan's Policy Direction”, Dangdai Yatai, No. 9, 1999, pp. 8-16; Zhu Feng, “Areas Surrounding Japan”: Contradictions and Problems”, Xiandai Guoji Guangxi, No. 8, 1999, pp. 23-26; Yang Bojiang, “Closer Alliance with Washington: Tokyo's Strategic Springboard for the New Century”, Contemporary International Relations, 9:6 (June 1999), pp. 9-20; Lu Zhongwei, “What Are the Intentions of 'Revised Guidelines'?”, Renmin Ribao, 30 April 1999; Zhong Weihe, “Track Change of Japan's National Strategy”, Guangming Daily, 30 April 1999; Tang Tianri, “Be Vigilant against the Changes of Japanese Defence Policy”, Liaowang, No. 3, 1999, p. 56; Su Hao, “Summary of the Academic Conference on the Adjustments of US-Japan Security Alliance and Asia-Pacific Security”, Meiguo Yanjiu (American Studies), No. 1, 1998, pp. 143-47; Yang Bojiang, “What Does 'The Joint Declaration of Japan-US Security Cooperation' Mean?”, Xiandai Guoji Guanxi, No. 6, 1996, pp. 2-6. 46 Gao Haikuan, “The `Adjustments of Relations among Big Powers and Security Situation in the Asia-Pacific”, Dangdai Yatai, No. 1, 1999, p. 4.

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conducted under the guise of so-called 'threat'.”47 The analyst argues that TMD is a weaponry system incorporating both defensive and offensive capabilities. Japan is therefore currently “producing shields for the ultimate goal of making swords”.48 Japan's 2000 Defence White Paper is viewed in light of these concerns. An article published in Jiefangjun Bao (People's Liberation Army Daily or PLA Daily) points out that the latest annual White Paper increased the contents about “being vigilant against Chinese military movements”. This, the article claims, is intended to divert other countries' concerns over Japanese military build up to the Chinese military. More importantly, the article believes, the White Paper is trying to find an excuse for Japan's military build-up because the two Koreas are moving quickly towards rapprochement and Japan has found it hard to justify its TMD programme.49 China's concern of Japanese military power is underscored by Japan's economic and technological strength. It is believed Japan can quickly acquire a huge, advanced military industry in case of war. This is because Japan has not only industrial bases, but also high-quality manpower and advanced technology. For example, Japan's FSX fighters are believed the best in the world. Japan's hightech products are widely used in American high-tech weapons. In terms of nuclear weapons, Japan is able to produce atomic bombs and hydrogen bombs within 3-6 months and 1,000 to 2,000 medium and long-range missiles within one year.50 Cases for Caution The above perceptions represent the mainstream of Chinese analysts. These perceptions, however, need to be treated with caution as these may not necessarily be the net perceptions. A striking feature in Chinese society with regard to Japan is that despite deepened economic integration and increased cultural exchanges between the two countries, there is still a strong antiJapanese political culture in China. Japan bashing, centring on revitalisation of militarism, is popular in the Chinese media. 47 Meng Xiangqing, “Strategic Movements with Evil Intentions: Background and Intentions of Japan's Participation in the TMD”, Shijie Zhishi, No. 7, 1999, p. 18. 48 Meng, p. 19. 49 “Understanding Japan's 2000 White Paper on Defence”, Jiefangjun Bao, 3 August 2000. 50 Lu Baosheng, p. 37.

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Chinese concerns are legitimate to a great extent, mainly because of Japan's failure to squarely face the past and its reluctance to constrain the right-wing groups, which deny Japanese war crimes. The strong anti-Japanese political culture, however, tends to magnify the 'Japan threat' and is not conducive to academic debates and balanced views on the future development of Japan. This is especially so given the fact that Chinese security analysts “think more like traditional balance of power theorists than do most contemporary Western leaders and policy analysts”.51 It can be argued that most Japanese do not support and, indeed, can hardly conceive a militaristic, imperial Japan in the future. According to an opinion poll of March 1999, 43 percent of Japanese generally opposed a revision of the Guidelines. Of the 37 percent who were in favour of the revision, most believed that it was of a defensive nature and would promote Japan's security.52 Although public opinion on one particular issue could change quickly and dramatically, it is fair to say that pacifism is still the dominant force in today's Japan. This, along with political restraint and Japan's economic stake in the regional and global status quo, may well make Japan “incapable of aggression for decades to come”.53 In terms of military power, despite an impressive array of weapons, Japan lacks power projection capabilities. On the other hand, it is understandable that the Japanese are nervous about the rapid rise of China. Indeed, as pointed out by Yoichi Funabashi, a rising China “will induce critical, painful, and psychologically difficult strategic adjustments in Japanese foreign policy”.54 China should be able to facilitate the adjustments. Such views are not popular in China. But they do exist. In his 1995 book on Japan, Liu Jiangyong, a leading Japan specialist, has a paragraph of caution after analysing Japan's 1991 Peace Keeping Operation (PKO) bill.55 He emphasises that “many Japanese 51 Christensen, “Chinese Realpolitik”, p. 37. 52 LatelineNews, “Japanese Oppose Revised Japan-US Defence Plan—Poll”, 19 March 1999. http://lateline.muzi.net 53 Kristof, p. 43. 54 Yoichi Funabashi, “Tokyo's Depression Diplomacy”, Foreign Affairs, 77:6 (NovemberDecember 1998), p. 32. 55 The lower house of Japan's Diet forcibly passed the “UN Peacekeeping Operations Bill” on 15 June 1992. The bill permits up to 2,000 members of the SDF to be dispatched overseas for UN-sponsored peacekeeping operations.

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people are peace-lovers”.56 Jiang Lifeng of the Chinese Academy of Social Sciences (CASS) is even more specific, arguing that: The distrust between China and Japan on security matters will not disappear in the near future. But for a fairly long period, Japan is unlikely to be a security threat to China … The possibility of Japan becoming militaristic as it was before the (Second World) War no longer exists.57 These analysts also believe that while Japan will continue to strengthen its military capabilities, it will try to enhance its political power largely through economic activities. Another factor, which might reduce Japan's threat to China and appears recognised by most Chinese analysts is the fact that Japan needs China's support and “understanding” in enhancing its role in the world. “SinoJapanese relationship is Japan's 'trump card' in its efforts of resisting US pressures”, an analyst claims. “Japan will also regard China as a key factor in its UN diplomacy”.58 Japan's early lifting of postTiananmen sanctions against China was regarded as an example of China's importance to Japan. In the early 1990s, while many analysts claimed that Japan's military power had gone far beyond the necessity of territorial defence, some analysts focused on its defensive nature. One analyst observed that although Japan no longer played the obedient lamb of the United States, its defence capabilities were still very limited relative to those of the United States and Japan still needed security protection from the United States.59 Even the military newspaper Jiefangjun Bao had not been always alarmist. In early 1991, the newspaper published an article analysing Japan's five-year program for the SDF adopted in December 1990. The article acknowledged Japan's massive arms expansion. Yet it argued that the expansion was mainly to strengthen its defence: air capability “to retaliate against air attacks”, to intercept “low altitude penetration” and to provide 56 Liu Jiangyong, Kua Shiji de Riben (Japan Over The Century-End), p. 400. 57 Jiang Lifeng, “The Present and Future of the Sino-Japanese Relations”, Riben Yanjiu, No. 3, 1998, p. 14. 58 Xu Zhixian, “The Prospects of A New Type of Sino-Japanese Relations in the 21st Century”, Xiandai Guoji Guanxi, No. 9. 1998, p. 4. 59 Zi Jian, “Two Problems in U.S. - Japan Relations”, Shijie Zhishi, No. 13, July 1990, pp. 10-11, carried in FBIS-CHI, 6 August 1990, pp. 1-3.

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“air defence over important areas”; naval growth “to strengthen defence of the surrounding waters and defence of the sea transportation and communication lines inside the 1,000 nautical miles” and ground-force improvements “to stop the enemy from landing”.60 China's perception of the Japanese military has obviously become more sober since the Clinton-Hashimoto joint declaration and the revised guidelines. Yet, Chinese feeling towards the alliance is rather complicated. Even those who believe that Japan's role is no longer purely defensive may also acknowledge that the adjustments to the security alliance do not constitute a “licence” for Japan becoming a political power.61 It is believed that US long-term strategy in the region is to prevent the emergence of a great power or “a big-power bloc” that would challenge the United States.62 What the United States wants from Japan is a strong assistant who may help strengthen its dominant position in the region. While the United States may want Japan to play a greater political role, it will not allow Japan to become a real political power and play a dominant role in the region. Given the fact that many Japanese have become more assertive and dissatisfied with being a junior partner in JapanUS security ties, some Chinese analysts do acknowledge that it is necessary to revitalise US-Japan security alliance to prevent Japan from becoming too independent in making security policies.63 An analyst believes that the role of US-Japan alliance has always been two-fold: one to protect from external threat and the other to prevent Japan from becoming a military power. The importance of the latter has surpassed the former with the end of the Cold War.64 Indeed, it is believed that the potential development of conflicts between Japan and US are inevitable and insurmountable.65 The 60 Xi Zhihao, “Japan's New Five-Year Arms Expansion Plan”, Jiefangjun Bao, 28 January 1991, p. 4, carried in FBISCHI, 11 February, 1991, pp. 16-17. 61 Ma Yu-an, “Japan's Geodiplomatic Strategy for Becoming A Political Power”, Shijie Jingji yu Zhengzhi, No. 9, 1997, pp. 53-57. 62 Wang Zhongchun, “21st Century China: Calmly Coping with the Changing World”, Ta Kung Pao, 18 January 2000, carried in FBIS-CHI (Web version, Article Id: FTS20000214000061). 63 Ma Yu-an, pp. 53-57; Yu Juliang, “Examining 'US-Japan Joint Declaration on Security' at Its First Anniversary”, Guofang Daxue Xuebao (Journal of National Defence University), No. 6, 1997, pp. 54-58. 64 Xi Lanwan, “A Major Readjustment in US Security Strategy towards Japan”, Xiandai Guoji Guanxi, No. 6, 1996, p. 8. 65 Xu Wansheng, “Japan-US alliance Relations after the Cold War: Three Major Developmental Tendencies”, Contemporary Asia-Pacific Studies, No. 10, 2000, carried in Northeast Asia Peace and Security Network Daily Report, 7 November 2000. http://www.nautilus.org/napsnet

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problem for Chinese analysts is that China is being made the imaginary enemy and Japan is taking the opportunity to expand its military. Chinese analysts thus seem to be in a dilemma. On the one hand, they would like to see US protection of Japan continued so that Japan will not feel compelled to rapidly build up its military. On the other hand, they believe China is now being targeted and Japan's military role is expanding anyway. As for the possibility of Japan developing nuclear weapons, a prominent Japan specialist asserted in 1991 that Japan would not make “such a bad decision”. Not only had Japan's nationals “always detested atomic war” because of the experience in World War II, but the country was also vulnerable to nuclear retaliation: “a narrow island country … void of strategic depth … only a very brief warning period against missiles … a high density of factories and population … some 40 working nuclear reactors.” The analyst concluded that: “Developing nuclear weapons will not enhance Japan's security but will only end in the country's survival being threatened by a fatal blow.”66 Chinese concerns have increased since the nuclear tests of India and Pakistan in May 1998 and the launch of a North Korean rocket across Japanese territory on 31 August 1998. But optimism on the issue has not died out. Some Western scholars have noticed that some youngergeneration Chinese analysts tend to maintain a more positive view on Japan and believe China should examine its own behaviours. For example, Allen S. Whiting noted in his classic 1989 book China Eyes Japan that some junior Japan specialists in China pointed out that the Chinese should learn more about Japan and should not be 67 biased against the Japanese. Bonnie S. Glaser noted in 1993 that some younger-generation Chinese analysts believed that the world was increasingly interdependent in both economic and security terms and that a Japan with greater political power would not 68 necessarily result in a remilitarised Japan. More recently, Thomas J. Christensen noted in 1999 that some younger Chinese experts 66 All citations are from Zhou Jihua, “The Trend of Japanese Defence Policy”, Shijie Zhishi, 16 January 1991, p. 13, carried in FBIS-CHI, 1 March 1991, p. 18. 67 Whiting, China Eyes Japan, p. 13. 68 Bonnie S. Glaser, “China's Security Perceptions: Interests and Ambitions”, Asian Survey, XXXIII:3, (March 1993), p. 257.

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(appearing to be in their forties or younger) with extensive experience abroad did recognise that Chinese military strengthening and provocative actions could result in Japan's 69 military build-up. The implication of these observations should not be overestimated. For one thing, the influence of these young analysts is limited and their views may not be widely heard. For another, their number is few and they can hardly represent youngergeneration analysts. Generally speaking, there is no fundamental difference between old and younger generations of Chinese analysts. The perceived difference may have less to do with their perceptions than the fact that younger-generation analysts tend to be less restrained when they are talking to Western scholars. Policies Towards Japan Basically, China's policies towards Japan reflect its mainstream perceptions. During the March 1991 National People's Congress session, Foreign Minister Qian Qichen said that it was “naturally necessary” to maintain vigilance against Japan's militarism because there was a possibility that a small number of Japanese would try to develop the military forces beyond the needs of self-defence.70 Hence China was especially concerned about Japan's PKO bill. In April 1992 when Jiang Zemin, as the Chinese Communist Party's (CCP) General Secretary, was visiting Japan, he repeated China's position that Japan should “exercise caution” about sending forces overseas.71 On 11 June 1992, just days before the lower house of Japan's Diet passed the bill, a Chinese Foreign Ministry spokesman expressed the hope that the Japanese government would be “prudent” in considering sending troops abroad. The spokesman said: “Due to historical reasons, Japan's sending troops abroad is a very sensitive issue.” 72 69 Thomas J. Christensen, “China, the U.S.-Japan Alliance, and the Security Dilemma in East Asia”, International Security (23:4, Spring 1999), p. 49, carried in Expanded Academic (Ejournal). 70 Chu, “The PRC Girds for Limited, High-Tech War”, p. 183. 71 Keichi Kawanshi, “Chinese Party Leader's Visit Stirs Bitterness”, The Nikkei Weekly, 25 April 1992, p. 7. 72 Xinhua, “Foreign Ministry Holds Weekly Press Conference”, 11 June 1992, carried in FBIS-CHI, 11 June 1992, p. 1.

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China's position on the issue reflected the recommendation made by the CASS Study Group on the International Situation. The group was led by a deputy-director of the CASS. It recommended in early 1992: As for the problem of Japan sending SDF to participate UN peacekeeping operations, we should be vigilant and should not readily soften our position (expose and criticise when necessary) because this problem has virtually gone beyond the area of political power. It is the first step to becoming a military power.73 At the same time, Japanese officials' remarks which deny or play down the atrocity committed by the Japanese in World War II have elicited without exception Chinese government's denunciations. Beijing also resents Japanese politicians' annual visits to the Yasukuni Shrine. In a latest case, in August 2000, Transport Minister Hajime Morita had to cancel a planned trip to China after Beijing told Tokyo that there was a “scheduling problem.” It was speculated that the real reason was Morita's visit to the Yasukuni Shrine a few days earlier.74 Fifty-six years after the war, Japan's wartime role is still a matter of great sensitivity in Sino-Japanese relations. Malaysian Prime Minister Mahathir Mohammad said in 1994 that Japan should not continue to apologise for things that happened half a century earlier.75 China's stance is much tougher. In his visit to Japan in November 1998, Jiang Zemin pushed hard for a full, written apology from Japan. Japan's refusal to do that and its reluctance to make a “no compromise” statement on Taiwan left a joint declaration unsigned by either side. China has been reluctant in supporting Japan to play a greater political role regionally and globally. Beijing's rejection of Japan's 73 The CASS Study Group on International Situation, “The Analysis of Some Problems in International Situation and the Tentative Countermeasures” (abridged), Yanhai Jingmao (Coastal Economy and Trade), February 1992, p.6. 74 “China Withdraws Morita's Welcome”, The Japan Times (Web version), 18 August 2000. 75 Kazuma Yoshido, “Forging Future of Asia”, The Daily Yomiuri, 31 August 1994, p. 3, carried in Reuters Business Briefing, 31 August 1994.

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suggestion that China should take part in July 2000 Group of Eight (G8) summit held in Okinawa was seen as a clear indication that Beijing was determined to keep Tokyo from playing a dominant diplomatic role in the region.76 A far more important indication is China's attitude towards Japan's quest for a permanent seat in the UN Security Council (UNSC). China's position on the issue has been lukewarm at best. Beijing has the fear that this will provide international legitimacy for Tokyo playing a greater global role, perhaps with military forces. In June 1994, Jiang Zemin said that the Chinese “understand and attach importance” to Japan's wish. “China is in favour of expanding the size of UNSC when the time is ripe to reflect the reality of the changing international situation, and the increasing number of UN members,” Jiang claimed. But at the same time, he maintained that “the wealth of a country should not be the sole condition taken into consideration, and that the principle of fair regional distribution, and the principle of unanimity in consultation should be fully honoured in approaching this issue.” 77 Jiang's remarks could be regarded as China's opposition to Japan's UNSC bid. First, Japan's UNSC ambition had been largely based on its economic strength. A senior Japanese Foreign Ministry official said in mid-1994 that “the UN question is basically a question of money”. Japan would be raising its contribution to the UN budget soon from 12.4% to 15%. “That should give us a right of entry,” the official claimed.78 Second, both China and Japan are situated in Northeast Asia. Japan's entry would not be in accordance with the principle of fair regional distribution. Third, some countries, such as South Korea, had explicitly expressed their opposition to Japan's UNSC bid. Some other middle-sized countries, such as Italy, were also reserved on the issue.79 China's position on the issue has remained largely unchanged ever since.80 76 Reuters, “China G8 Rejection Seen Slap at Japan PM Diplomacy”, carried in LatelineNews, 23 February 2000. 77 Xinhua, “Xinhua Reports on Interview”, 10 June 1994, carried in FBIS-CHI, 13 June 1994, p. 2. 78 Charles Smith, “Japan—War and Remembrance”, Far Eastern Economic Review, 25 August 1994, p. 22. 79 Li Shongcheng and Wang Zaibang, “World Outlook 1995”, Contemporary International Relations 5:1 (January 1995), p. 2. 80 In September 1997, when asked about a permanent seat for Japan on the UNSC, Chinese Foreign Minister Qian Qichen repeated that “China has all along been cautious over the expansion of the U.N. Security Council and must consider the entry of developing countries and a geographical balance.” LatelineNews, “China Mark 25-Year Tie with Japan”, 30 September 1997; LatelineNews, “China Noncommittal on Japan's UNSC Bid”, 15 March 2000.

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In the field of security dialogue and military exchanges, the Chinese military was rather active in the 1980s but reserved in the 1990s. In the 1980s, many high-ranking PLA officers visited Japan, including the defence minister, a vice minister, a deputy chief of staff. The Japanese Defence Agency (JDA), however, was much less active. No officials of comparable rank from Tokyo visited China in any capacity. One major reason is that the Japanese believed that the exchanges could help to modernise the PLA and that the Chinese had more to gain from military visits than Japan.81 After the 1989 Tiananmen Square crackdown, however, Japan became more active. Tokyo took the advantage of Beijing being temporarily isolated by the Western countries and began to directly approach Beijing to “open up a quiet security dialogue”.82 In 1992, believing China's military modernisation was a potential threat, Japan strengthened its efforts of encouraging China to participate in security dialogue and other forms of confidence-building measures.83 The belated first round of security talks was finally held in December 1993. Symbolically important as they were, China was not enthusiastic in holding the talks with Japan. The Japanese government had intended to have uniformed members of each country's defence establishment join the security talks. But due to China's objections, the talks ended up with only diplomats present. After the first round of talks, China made some efforts in increasing security dialogues and military exchanges with Japan. In March 1994, officials of the defence ministries met in Beijing for the first talks on security between the two ministries. It was followed by the second round of talks in January 1995 when China invited the Chairman of the Joint Staff Council of the SDF to visit China for talk. 81 Whiting, China Eyes Japan, p. 133. 82 Tai Ming Cheung, “The Interaction Between Economies and Security for China's External Relations”, unpublished paper, May 1993, p. 14. 83 The Japanese Blue Book on Foreign Policy 1992 stated that China would continue to carry forward its military modernisation and would import fighter aircraft from Russia. This “has caused some ASEAN countries to worry about China's military expansion” and maintain a close watch on China's future intentions. In this regard, Japan suggested that China and Japan should also develop a bilateral dialogue. See Liu Jiangyong, “On the Establishment of Asian Pacific Multilateral Security Dialogue Mechanism”, Contemporary International Relations, 4:2 (February 1994), p. 9.

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The next three years, however, revealed the fragility of security relations between Beijing and Tokyo. A series of events made it impossible for the two nations to make meaningful progress in this aspect. China conducted nuclear tests in May and July 1995. The issue was followed by the Taiwan Strait crisis in which China staged military exercises and tested its missiles in waters close to Taiwan. Although the exercises and tests were aimed at intimating Taiwan, they shocked the Japanese. Then came the upgrade of security ties between Tokyo and Washington and Japan's decision to join the TMD research. Beijing's position on US-Japan security alliance and Japan's participation in the TMD research clearly reflects China's mainstream perceptions. It repeatedly voiced concerns over Japan becoming a military power and protested against the inclusion of Taiwan in US-Japan security cooperation and the TMD program. Qian Qichen stated in September 1997 that “If the (US-Japan security) treaty is a bilateral treaty, there is no need to make a new agreement, so China can only think that this is a new kind of treaty.” He harshly criticised the revised guidelines, saying: “The more one tries to hide, the more one is exposed.” 84 China has been more active on security talks and military exchanges since 1998. Chinese Minister of Defence Chi Haotian visited Japan in February 1998, the first visit to Japan by a Chinese defence minister since 1984. Kyuma Fumio, head of the JDA, paid a reciprocal visit in May 1998, the first visit to China by a JDA chief in 11 years. Bilateral military exchanges reached a new high in April 2000 when General Fu Quanyou, Chief of General Staff of the PLA, visited Japan, the first official visit to Japan by a top Chinese uniformed officer since 1986. General Yuji Fujinawa, Chairman of Japan's SDF Joint Staff Council, returned the favour with a visit to Beijing in June 2000. The revitalised military exchanges, however, do not signal a significant perception or policy change on the Chinese side. The exchanges should be seen in the context of China's more active attitude towards defence-related talks with other countries, including South Korea, Russia and the United States. In 1999, approximately 33 senior-level delegations from the PLA visited nearly 50 foreign countries, while 89 groups of foreign army leaders were received in China(85 84 LatelineNews, “China Mark 25-Year Tie with Japan”, 30 September 1997. 85 Xinhua, “Review of PRC 1999 Military Diplomacy”, 5 January 2000, carried in FBIS-CHI (Web version, Article Id: FTS20000105000165).

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The increased military exchanges also reflect Beijing's pragmatism and flexibility in its policies towards Tokyo. Although the Chinese government has been firm in warning of a revitalisation of Japanese militarism, it has been careful not to let the history issue derail the bilateral relationship. When the Gulf War triggered the Japanese debate over peacekeeping, China expressed fears that this would be a harbinger of Japanese militarism. Yet when a watereddown PKO bill was finally passed in June 1992, Chinese criticism was somewhat muted.86 Jiang Zemin's 1998 visit to Japan was marred by the unsigned joint declaration. China's 'miscalculation' should be seen against the background that Japan offered a written apology to South Korea when President Kim Dae-Jung was visiting Japan in the previous month.87 More tellingly, Chinese Premier Zhu Rongji trod lightly on history issue when he was visiting Japan in mid-October 2000. In the case of the cancellation of Morita's planned trip to Beijing, what needs to be noted is that it was not supposed to be an important trip. Morita was to promote Japan's bid to build a high-speed rail link between Beijing and Shanghai. Another example is Beijing's much restrained reactions towards the Diaoyu (Senkaku) Islands dispute. The dispute attracted much public attention inside and outside China after a Japanese rightist group built a lighthouse on the disputed territory in July 1996. Tens of thousands of overseas Chinese in North America and people in Taiwan and Hong Kong protested the Japanese act. While Beijing was firm in claiming sovereignty over the islands, it was careful not to whip up Chinese nationalism against Japan. Tong Zeng, perhaps the most prominent anti-Japan campaigner in China, was sacked because of his activism.88 86 Manning, pp. 53-54. 87 In a joint declaration issued by Keizo Obuchi and Kim Dae-Jung, Obuchi “expressed deep remorse and extended a heartfelt apology to the people of South Korea, having humbly accepted the historical fact that Japan inflicted heavy damage and pain on the people of South Korea through its colonial rule” during the period of 1910-1945. It was the first written apology ever issued to an individual country by Japan for its actions before and during World War II. A Japanese foreign ministry official initially said Jiang would be able to get the same kind of apology in a joint declaration. It is believed Japan's domestic politics prevented Obuchi to deliver the same apology to China. See Reuters, “China To Get Same War Apology From Japan As South Korea”, carried in LatelineNews, 9 October 1998; Kyodo, “China Wants War Apology from Japan in Joint Statement”, carried in LatelineNews, 3 November 1999; Reuters, “Japan Attitude on Past Reflects Political Disarray”, carried in LatelineNews, 26 November 1998; Anonymous, “Ghosts from China and Japan”, The Economist, 354:8155 (29 January 2000), p. 44. 88 Reuters, “Anti-Japan Activist Sacked in China—Rights Group”, carried in LatelineNews, 19 October 1998.

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Beijing's restraint partly lay in its realisation that nationalism is a double-edged sword and demonstrations against Japan could turn into anti-government protests. Equally important, Beijing was determined not to let the issue overshadow the big picture of SinoJapanese relations.89 In this sense, China's policies towards Japan do not necessarily mirror mainstream perceptions. The difference is partly because the mainstream perceptions may not be net perceptions. It is also because of the big gap existing between Chinese analysts and policymakers.90 But more importantly, policies towards Japan cannot be separated from China's overall security strategy which is determined largely by Chinese leaders' worldview, the hierarchy of national interests, regional security environment and domestic politics. Chinese leaders' worldview since the end of the Cold War has been less ideology-oriented. However, this does not mean that ideological conflicts no longer exist. 'Westernisation' is still regarded a major threat to the CCP and the Chinese government. Pressure on human rights from the West, especially that from Washington, is regarded as part of the subversive 'peaceful change' strategy to alter China's political system and hence a threat. This worldview has provided strong incentives for Beijing to strengthen its relations with Tokyo. The fact that Japan lifted sanctions not long after the Tiananmen Square crackdown shows that Japan poses little political threat to the CCP and the Chinese government. Japan also stopped co-sponsoring UN resolutions authored by the United States condemning China's record on human rights in 1996. Therefore, Japan is a card which China could play against the United States. China's hierarchy of national interests has been characterised by Beijing's emphasis on enhancing “comprehensive national power” in which a powerful modern economy is essential. 89 For a detailed analysis of the issue, see Erica Strecker Downs and Phillip C. Saunders, “Legitimacy and the Limits of Nationalism”, International Security 23:3 (Winter 1998), p.114, carried in Expanded Academic. See also Zheng Yongnian, Discovering Chinese Nationalism in China: Modernization, Identity, and International Relations (Cambridge and New York: Cambridge University Press, 1999), pp. 131-136. 90 Yu Bin, “The Study of Chinese Foreign Policy: Problems and Prospect”, World Politics, 46:2 (January 1994), p. 254.

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Indeed,91 to enhance comprehensive national power has been China's “national strategy” (guojia zhanlue) since the 1980s.92 Yan Xuetong states in his influential book on China's national interest: “Economic development is the highest goal in making external strategies.”93 Japan plays a vital role in China's economic reform and development. In 1993, Japan became China's largest trading partner while China emerged as Japan's second largest after the United States. In 1999, two-way trade between Japan and China reached US$66.17 billion and is fast growing.94 Japan used to be the third largest and now is still the fourth largest investor in China after Hong Kong, Taiwan and the United States. It remains the most important provider of official economic assistance. Tokyo has extended more than US$23 billion in economic assistance to China during the past 20 years.95 In terms of the regional security environment, China is aware that in the unsettled post-Cold War world, the rise of China has made some of its Asian neighbours nervous. These countries would like to have a strong force balancing against China. The subdued Southeast Asian reaction towards upgraded US-Japan security alliance is a clear sign. It should also be noted that as “one of the outstanding achievements of post-war Japanese diplomacy”,96 Japan has strengthened its relations with members of the Association of Southeast Asian Nations ASEAN). More importantly, hard-line policies towards Japan could frighten Japan and thus strengthen Japan's willingness to assist the United States in its strategic deployment against China. A good relationship with Japan is therefore essential for China to alleviate its Asian neighbours' concerns and to create a favourable regional security environment. 91 A Chinese official explanation about “comprehensive national power” (CNP) refers it to “the totality of a country's economic, military and political power in a given period. It signals the country's comprehensive development level and its position in the international system. In the content of the CNP, economic power, including labour power, material resources and financial power, is the determinant and foundation of a country's political and military power.” As quoted in Zheng, pp. 114-15. 92 Zheng, pp. 111-138. 93 Yan Xuetong, Zhongguo Guojia Liyi Fenxi (An Analysis of China's National Interests), (Tianjin: Tianjin Renmin Chubanshe, 1996), p. 309. 94 Xinhua, “China-Japan Trade Expected to Rise: Report”, 27 February 2000, carried in Expanded Academic. 95 John Pomfret, “Rocky Road for China-Japan Talks”, Washington Post, 29 August 2000, p. A14 (Web version). 96 Yoichi Funabashi quotes Gerald L. Curtis in Funabashi, p. 29.

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Another important reason for China cultivating its ties with Japan lies in its domestic politics. Despite a strong anti-Japanese sentiment in the Chinese public, China's domestic politics generally encourages a good relationship with Japan. Although few Chinese leaders are as enthusiastic as late CCP General-Secretary Hu Yaobang in promoting Sino-Japanese friendship, there is basically a consensus among the leaders that China should maintain a positive and stable relationship with Japan. After all, Japan is so important to China's economic development and to have sustained economic growth is essential to China's stability which is the “highest priority” of the Chinese leadership.97 In addition, as mentioned earlier, Chinese leaders maintain a benign view on Japan's political threat to the CCP and the Chinese government. Prospects of Sino-Japanese Security Relations China is likely to continue its current policies towards Japan in the foreseeable future. On the one hand, China will keep a wary eye on Japan's military power and its ambition to become a political power. On the other hand, it will continue to focus on its national strategy of enhancing comprehensive national power in which Japan plays an essential role. It is widely believed in China that to develop economy and enhance national power remains to be China's “permanent solution to all internal and external problems”.98 Economic relations will remain the central pillar of the bilateral relationship although more economic disputes are likely to arise with increased economic interactions and a more competitive Chinese economy. China will also maintain a positive relationship with Japan in order not to compel Japan to further deepen its security ties with the United States and to speed up the strengthening of its military. Beijing and Tokyo will make efforts to have constructive dialogues and will cooperate in setting up 97 Richard L. Grant, “China and Its Asian Neighbours: Looking Towards the Twenty-First Century”, The Washington Quarterly, 17:1 (1993), p. 62. Many Chinese strategic thinkers also believe that economic and scientific challenges, instead of military invasion, are China's main threat. See Chen Qimao, “New Approaches in China's Foreign Policy: The Post Cold War Era”, Asian Survey, 33:3 (March 1993), p.240. 98 Chu and Wang, p. 6; Yan Xuetong, “International Environment and Thoughts on Diplomacy”, Xiandai Guoji Guangxi, No. 8, 1999, p. 10.

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confidence-building measures (CBMs). However, the future relationship still faces a number of serious challenges. The historical legacy will remain a major challenge to political leaders in both Tokyo and Beijing. In Japan, with the war memory fading away and domestic politics moving towards the right, it has become increasingly difficult for Japanese leaders to face the past. As late as April 2000, Japanese Prime Minister Yoshiro Mori was still reluctant to acknowledge that Japan committed aggression against its neighbours.99 As noted by Nicholas D. Kristof, “the danger remains that Japan will recover its nerve before it fully confronts the past.”100 This is what China has been trying to prevent from happening. A cynical view is that Japan is simply waiting for the passing away of the World War II generation. Some do not believe Asia's resentment of Japan will die with the war generation.101 They may be right. Yet, coupled with the change of balance of power in the region, the disappearance of the war generation will have a strong impact on the policies of some Asian countries. When the Japanese Diet passed the bill sanctioning the Rising Sun (Hinomaru) flag as national flag and the “Kimigayo” hymn as national anthem, the reactions of Asian countries were largely mild.102 Most Asian countries that suffered from Japanese invasion and occupation are now less vocal in criticising Japanese government's attitude towards the past and some even welcome a more assertive Japan with a rising China in their mind.103 99 Mori said on 24 April in the Japanese parliament: “Regarding the war, I am of the opinion that there are various views due to different historical backgrounds. Whether Japan launched a war of aggression, it takes people's judgment on history.” He revised his vague explanation one month later. See Frank Ching, “Japan Still Avoids Its Past”, Far Eastern Economic Review, 22 June 2000, p. 36; Xinhua, “Japan's Past War Against China Was Aggressive: Mori”, 23 May 2000, carried in Expanded Academic. 100 Kristof, p. 47. 101 Kristof, p. 38. 102 Both the “Hinomaru” flag and the “Kimigayo” hymn are proudly touted by nationalists but condemned by leftwingers and liberals because of their connection with Japan's militarist and imperial past. 103 Rusdi Mustapha, et al., “So Why Isn't the Rest of Asia Worried about Japan?”, Time International, 154:6 (16 August 1999), p. 18, carried in Expanded Academic.

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It is sometimes argued that since Tokyo's reluctance to squarely face the past is useful to China as proof that Japan should not be allowed to play a greater political role, China therefore does not have interest in getting a decisive apology from Japan. This argument cannot be convincingly justified before Japan has proved its genuine willingness and sincerity in dealing with the history issue. As argued by Kristof: “An apology will not instantly wash away the residue of hatred and resentment toward Japan that has accumulated over the decades. But a genuine expression of regret would be a good first step, and a thorough attempt to educate young Japanese about the past would be asecond.”104 Japan's ad hoc attempts to face the past have done little in improving its international image. On the other hand, China's persistent criticism of Japan's attitude towards the past may exacerbate Japan's intransigence and further strengthen Japanese nationalism and resentment against 'apology diplomacy' as demonstrated in Jiang's 1998 visit. The result could be an even deeper mutual distrust between the two giants in Northeast Asia.105 This concern underlined Zhu Rongji's efforts to tone down his stance on the history issue in his visit to Japan in October 2000. To sidestep the past, however, is not the way to build long-lasting mutual trust. Beijing will continue its effort to slow down Japan's long march towards a political power status. This does not mean China will show no flexibility on the issue. An analyst argues that while China needs to “rely on the United States to constrain Japan” (jiemei xianri) on certain issues, in a longer term it is more important to “rope in Japan to constrain the United States” (lari xianmei). China therefore should “conditionally” support Japan's political ambition.106 While this reflects different perceptions of 104 Kristof, p. 45. 105 For mutual distrust between the Chinese and the Japanese public, see Christopher B. Johnstone, “Japan's China Policy: Implications for U.S.-Japan Relations”, Asian Survey, 38:11 (November 1998), pp. 1068-69. 106 Wang Shaopu, “Japan Policy in China's External Strategy”, Shanghai Shehui Kexueyuan Xuesu Jikan (Academic Quarterly of Shanghai Academy of Social Sciences), No. 4, 1999, pp. 83-92.

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China's primary concerns, Japan will nonetheless remain an important factor in China's strategy against the United States. Equally important, the Chinese have long realised: “That Japan becomes a political power and seeks to play a political role commensurate with its economic standing is an inevitable trend in its post-war historical development.”107 The CASS Study Group on the International Situation suggested that China should deal with the problems of Japan becoming a political power “case by case” (juti duidai).108 Thus, on the issue of Japan becoming a permanent member of the UNSC, although China is “bound to lose”109 and is likely to remain noncommittal, it will leave the choice open and would just step aside and let Japan enter in the event that Japan has won strong international support. China will try to avoid an arms race and tension with Japan as, according to Gerald Segal, it recognises it is in no position to win.110 However, the scenario that China competes with Japan in deep mutual distrust, if not a classic 'security dilemma', is not impossible. It is widely accepted among Chinese analysts that Japan will further strengthen its military and more importantly, Japan will sooner or later amend its Peace Constitution to accommodate its military activities overseas. China may not see Japan posing immediate military threat, but may nevertheless feel pressured to speed up its military modernisation. China has already been modernising its military for some years. In the first half of the 1990s, some analysts noticed that although Beijing said it wanted to keep a safe and stable environment for economic growth, the PLA still seemed to have been charged with methodically building itself to be the strongest in the region.111 It is now well known that the use of hightech modern 107 Du Gong, “Earnestly Work for the Brighter Future of Sino-Japanese Friendly Relations”, Guoji Wenti Yanjiu (International Studies), No. 3, July 1992, pp. 1-4, carried in FBIS-CHI, 4 August 1992. p. 11. 108 The CASS Study Group on International Situation, p. 6. 109 Russell C. M. Ong, “Japan and China: Security Interests in the post-Cold War Era”, East Asia: An International Quarterly, 16:1-2 (Spring-Summer 1997), p. 44, carried in Expanded Academic. 110 Gerald Segal, “Opening and Dividing China”, World Today, 48:5 (May 1992), p. 79. 111 Larry M. Wortzel, “China Pursues Traditional Great-Power Status”, Orbis, 38:2 (Spring 1994), pp. 174-175.

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weaponry during the Gulf War had a great psychological impact on China and has prompted it to modernise its weapons system. There are multiple reasons for China to enhance its military capabilities. As noted by Bonnie S. Glaser: Beijing views a strong military equipped with advanced weaponry as important to boost China's national prestige, enhance Beijing's political role and influence, and counter a possible dramatic increase in Japan's political and military power in the region. In addition, China's military build-up is aimed at providing the basis for coercive diplomacy, deterring threats against Chinese interests, and maintaining the capability to use force to protect its interests.112 China's determination to modernise its military has only been strengthened since 1996 when the Taiwan Strait crisis highlighted China's possible conflict with the United States and when Washington and Tokyo decided to strengthen their security ties. China's military modernisation has evoked Japan's concern for some time. Some Japanese politicians and mass media argued in the early 1990s that an arms race and new unstable factors had appeared. They claimed that China was undertaking a military build-up and territorial expansion, forming a new threat in Asia. Yomiuri Shimbun stated that China's military reinforcement constituted “a threat to the international community” and urged China to “exercise restraint”.113 As noted by a Chinese analyst, China's efforts of modernising its navy and air force and the 1992 publication of Territorial Waters Law had been taken as evidences of China's efforts “to fill the vacuum left by the military withdrawal from Asia of the US and Soviet/Russia”.114 The analyst also noted that some Japanese had warned that: China's 21st century naval hegemony strategy will threaten Japan's lifeline for international trade.”115 Japan's concerns over the 'China threat' has been on the 112 Glaser, p. 271. 113 “Journal Views 3 Issues in PRC-Japanese Ties”, Tangtai (published in Hong Kong, 15 April 1993) pp. 90-91, carried in FBIS-CHI, 4 May 1993, p. 9. 114 Li Genan, p. 25. 115 Li Genan, p. 25.

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rise ever since. The 1996 Japanese Defence White Paper stated for the first time that: “attention must be paid to trends in the Chinese military”.116 Partly because of the 'China threat', the call for a more assertive Japan has become popular in Japan. A Japanese scholar complained in 1992: “Time and again the diplomats have paid more attention than necessary to Chinese conditions and requests, placing top priority on the diplomacy of friendship in order to avoid upsetting Beijing.”117 Another Japanese scholar believed that Japan had suffered diplomatic failures because it acted on the “mistaken premise” that the Chinese would behave rationally and in a friendly fashion as the Japanese did.118 There are increasing signs of Japan's assertiveness against China. In September 1994, when Beijing threatened to oppose Japan's UNSC bid to protest the attendance of Taiwan's deputy premier at the Asian Games in Hiroshima, Tokyo went ahead with the plan.119 Japan's reaction towards China's nuclear tests in May and July 1995 is a clearer indication of Japan's assertiveness. In response to the tests, Japan announced that it would reduce grant aid to China for fiscal year 1995. The decision marked Japan's first unilateral suspension of aid to China since relations were normalised in 1972 and was regarded as a “watershed” in the bilateral relationship.120 Because of its past history and the Chinese government's decision to renounce war reparations from Japan when the two countries normalised their relations, Japan has been handling its aid to China in a special way. But that special treatment is now under challenge. The Japanese government's decision in late August 2000 to postpone plans to extend 17.2 billion yen (about US$158 million) 116 As quoted in Sharif M. Shuja, “China after Deng Xiaoping: Implications for Japan”, East Asia: An International Quarterly, 17:1 (Spring 1999), p. 69, carried in Expanded Academic. The White Paper called attention to China's naval and air force modernisation efforts, expanded maritime activities, and nuclear weapons enhancement projects. 117 Nakajima Mineo, “Dealing with Beijing: Beyond the 'Diplomacy of Friendship'”, Japan Echo, 19:4 (Winter 1992), p. 22. 118 Eto Shinkichi and Kobori Keiichiro, “Two Sides to the China Trip Debate”, Japan Echo, 19:4 (Winter 1992), p. 15. 119 Satoshi Isaka, “Japan Fends off Chinese Threat over UN Seat”, The Nikkei Weekly, 3 October 1994, carried in Reuters Business Briefing, 3 October 1994. 120 William J. Long, “Nonproliferation as a Goal of Japanese Foreign Assistance”, Asian Survey, 39:2 (March-April 1999), pp. 333-34.

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in low-interest loans to China is a latest example. The government met strong opposition against the loans from members of ruling Liberal Democratic Party who demanded that the government must first express dissatisfaction with suspected Chinese spy ships roaming in Japans' exclusive economic zone and near Japanese territorial waters.121 As noted earlier, for the Chinese, Japan's cry of the 'China threat' is simply an excuse for military build-up and signals that Japan will take China as a major target for strategic defence. They believe that a more assertive, independent Japan is inevitable and they are in the process of getting used to it. The process will not be that smooth and is likely to be complicated by some potential conflicts, including strategic competition in the region, the dispute over the Diaoyu Islands, China's movements in the South China Sea, the Taiwan issue and, nationalism. With Japan becoming more assertive and politically active, strategic competition between Beijing and Tokyo is likely to intensify. While the possibility of China having a dominant influence in the Korean Peninsula in the future worries Tokyo, Beijing is wary of Japan's increasing influence in Southeast Asia, especially Vietnam. In terms of the Diaoyu Islands dispute, as witnessed in the past few years, the issue may trouble Sino-Japanese relations from time to time in the future although Beijing will continue its efforts to defuse the tensions. As for the issue of the South China Sea, it is simply natural that Japan will not sit by if it believes its vital interests there are in serious danger. It should be noted, however, that Japan is sensitive to China's position on the issue and is likely to continue its current approach of encouraging multilateral dialogue. 122 A greater concern is perhaps the Taiwan issue, not because Beijing may use force against Taiwan in the near future but because 121 The loan package was later approved after Beijing softened its position on the issue of its naval activities. Chester Dawson,“Friends Indeed”, Far Eastern Economic Review, 19 October 2000, p. 21. 122 Lam Peng Er, “Japan and Spratlys Dispute: Aspirations and Limitations”, Asian Survey, 36:10 (October 1996), pp. 995-1010.

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of the extreme sensitivity of the issue. Japan's reluctance to make a clear statement like Clinton's 1998 pledge of “three no's” - no support for Taiwan independence, no “two Chinas” or “one Taiwan, one China”, and no Taiwan's membership in international organisations that require statehood - and its refusal to explicitly exclude Taiwan from the scope of the Guidelines are worrying signs for the Chinese. With regard to the Guidelines, Japan is likely to maintain its ambiguity on Taiwan in the hope of “creating a situation in which problems cannot possibly be resolved by force”, thus deterring Beijing from launching military attacks against Taiwan.123 What makes all this potentially explosive is nationalism in both China and Japan. Nationalism has been on the rise in Asia since the end of the Cold War. As noted by Hisahiko Okazaki: “In Europe, it may be true that the age of nationalism has passed … but in Asia the age of nationalism is now.”124 While Chinese analysts are concerned about rising nationalism in Japan, comparatively speaking, the issues are more likely to be influenced by nationalism in China. Japanese emotional attachment to most of these issues is far weaker than that of the Chinese. As for the establishment of CBMs, the process would be slow and volatile. To integrate China into the international community is one of Japan's key strategic goals.125 Liu Jiangyong noted the following at the 20th anniversary of the 1978 Treaty of Peace and Friendship: “Tokyo held that the two capitals [Tokyo and Beijing] should not confine their ties to good neighbourly friendship, but should also strive to build a 'Japan-China relationship in a global context'.”126 Tokyo therefore will be more active in holding security talks with China and in promoting military exchanges. It will also encourage China to participate in multilateral talks. China, on the other hand, will find it beneficial to be more active in promoting CBMs. However, the effectiveness of the existing and future CBMs in dealing with the security relations of the two giants in 123 Hisahiko Okazaki, “A National Strategy for the Twenty-first Century”, Japan Echo, 26:5 (October 1999), p. 38. 124 Okazaki, p. 35. 125 Johnstone, pp.1067-85. 126 Liu Jiangyong, “International Partnerships Facing Challenges”, Contemporary International Relations, 9:4 (April 1999), p. 4.

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Northeast Asia may remain limited in the near future. Although “a growth industry”,127 multilateralism is relatively new to the AsiaPacific and confidence building mechanism is traditionally weak in East Asia.128 Despite the fact that China has been slowly overcoming its traditional reluctance to engage in regional security cooperation over the past decade, it is still much reserved with regard to the sharing of military information and transparency.129 Chinese analysts argue that while demanding transparency from other countries, Japan itself remains lukewarm on the issue.130 More importantly, compared with China's relations with other major powers, the Sino-Japanese relationship is reserved and lacks maturity. Conclusion Fifty-six years after Japan's surrender in 1945, China now faces new challenges in its security relations with its former enemy. This former enemy rose from the ashes of the war, grew into an economic superpower and is now increasingly assertive and determined “to test the limits of politically possible”. With the end of the Cold War and the disappearance of their common enemy the Soviet Union, Japan's newly found assertiveness and determination are worrisome to the Chinese. The concerns of the Chinese are rooted in their deep distrust of the Japanese. Chinese perceptions of Japan are overshadowed by the historical legacy and their concerns are compounded by Japanese military capabilities, which are perceived as increasingly threatening. The Chinese have rightful reasons to be concerned in that the Japanese government has not adequately addressed the history issue. The perceptions, however, could be politicised and should be treated with caution. 127 Ralph A. Cossa, “Multilateralism, Regional Security, and the Prospects for Track II in East Asia”, NBR Analysis, 7:5 (December 1996), p. 25. 128 Amitav Acharya, “Multilateralism: Is There An Asia-Pacific Way?”, NBR Analysis, 8:2 (May 1997), pp. 1-18; CSSA, pp. 25-38. 129 It should be noted that China is not encouraged by the deliberate ambiguity and lack of transparency of the revised US-Japan security cooperation guidelines. 130 He Fang, “New Developments of the China-US-Japan Triangular Relationship”, Fazhan Luntan (Development Forum), No. 5, 1998, p. 59.

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Foreign policies are largely determined by perceptions. China's policy towards Japan is no exception. With its distrust in Japan, China has been reluctant in supporting Japan playing a greater political role, as demonstrated in the case of Japan becoming a permanent member of the UNSC. Militarily, China has been wary of the changing role of Japan's military. Yet at the same time, Japan poses little political threat to the CCP and is essential to China's national strategy of enhancing comprehensive national power. Chinese leaders therefore support a positive relationship with Japan. China will continue to make efforts in forging a constructive relationship with Japan. However, a series of challenges will test the wills and skills of both leaderships. Most of these challenges have resulted from distrust in each other and the distrust is largely rooted in the historical legacy. It remains politically risky for Japanese leaders to come forward and squarely face the past. For the Chinese government, a dilemma is that while a firm stance on the issue serves it well domestically, it may backfire in Japan. Perceiving the growth of each other's strategic strength as a zero-sum game, Beijing and Tokyo will remain wary of each other's military developments. China will continue its military modernisation and Japan is set to strengthen its military capabilities. Both sides will try to avoid the scenario of a 'security dilemma'. But the danger remains. While a dramatic speed-up of China's military modernisation or a military deployment deemed aggressive by Tokyo will alarm the Japanese, Japan's acquiring of weaponry and technology deemed of an offensive nature by the Chinese or a drastic expansion of the Japanese military's role will cause much concern in Beijing. In addition, territorial disputes over the Diaoyu Islands, conflicts of interests in the South China Sea, Taiwan and nationalism may all fuel strategic competition from time to time. * This article was previously published by the Centre For Strategic Studies (Victoria University of Wellington, New Zealand) in 2001. 117

Countering US Hegemony: A Viable Option for China? Dynamics of the Sino-U.S. Relations in the Post Cold War Era

Dr. Cagdas UNGOR

Countering US Hegemony: A Viable Option for China? Dynamics of the Sino-U.S. Relations in the Post Cold War Era Introduction In April 2008, when wild protests were being held in the West against China's treatment of the Tibetan rebels, a forwarded e-mail message titled "How the Chinese Feel" circulated on the internet. This e-mail message was written by a furious Chinese citizen who tried to express the anger directed against the Western countries who threatened to boycott the Olympic Games. Most significant aspect of this e-mail was that it regarded the recent protests not as an isolated phenomenon but a continuance of the historical process which started with the Western powers' colonial aggression in China by the 19th century. It also demonstrated the Chinese people's familiarity and annoyance at the "China threat" discourse which became popular in the West since the 1990s. According to this angry e-mail, Chinese efforts of opening-up to the world and economic reforms fell on deaf ears: When our doors were closed to foreigners, You banged them down for opium./You tagged us the Sick Man of Asia, and Yellow Peril in opprobrium./ When our nation rotted from within, You marched in troops for a "fair share."/You clearly liked us divided and weak, Say Jump and we say How High./ Now we put the pieces back again, You raised issues of Tibet Taiwan Turkistan./Now you bill us "the next Superpower", and you scream "China Threat!"/ We Tried Communism to equalize, You hated us for being Communists./ Now we embrace free trade and privatize, You berated us for being Mercantilist/ (And since you made up that word, you must know what it means, as we don't)./ HALT! You demanded: a billion-three who eat well will destroy the planet!/ So we tried birth control, then You blasted us for human rights abuse./ When we were dirt poor, Your signs said "NO CHINESE OR DOGS."/Now we lend you cash at 2%, You blame us for your spending too much../We bring you nice affordable bling, You ingrates

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paranoid about poison/ (Yo'all pardon me for askin': exactly how many of You died?)./ We build our industries to feed the folks, You blame us for Pollutin'./ We patch up with the neighbors, You huff we're too good to Kim and Putin./You ganged up for O.I.L. and a million died, You called that liberation and alright./We just buy oil and help the natives get by, You wailed "Exploitation" and "Genocide"./ You demanded Rule of Law for us, but not like the rules for You./Before we can hit terrorists, you require that we must coddle their boss./ Whomever is anti-China, You harbor and honor by the score./Terrorists, theocracy, opium, and things that You yourselves reject / You demand that China must cherish, and grin and bear as swell./ When we the people were silent, You said there should be Free Speech./Now we're silent no mo', You insist we're Brainwashed or Bewitched./ And to top that off:/We worked hard, we worked smart, we made it the old fashioned way./ Yet when we throw a party to celebrate, you pissed on our parade./ Why do you hate us so much? We asked./You Answered, "No! We don't hate you./ We just hate your government, and wish you'd go tell Hu."/ We did, we did, and all of us now understand,/ And behind Beijing we stand, a hundred and twenty percent. This e-mail could not be cast aside as an isolated phenomenon because at around the same time this e-mail was circulated abroad, similar ideas were expressed at the nationalist demonstrations held in major Chinese cities Many Chinese felt that the main purpose behind the Western support for the Tibetan rebels was to cause China lose face on the eve of the Beijing Olympic Games, which the country has prepared for seven years to host properly. Chinese government is still struggling to adapt to the new international environment of the post-Cold War era, which globalized the human rights issues. In an increasingly interconnected world, it is more and more difficult for the Chinese regime to convince others that these issues should be handled domestically. However, if we look at the treatment of China in the global media and scholarship, one might argue that the Chinese 121

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objections against the Western double-standards are not totally ungrounded. Besides the constant theme of human rights, China is also criticized for its one-child policy, low-quality export goods, policy toward Taiwan and Hong Kong, environmental policies, etc. Particularly in the US, whereas China's weaknesses and problems make up the headlines, the country's successes are wrapped up in a story line that inflicts fear amongst the people. For instance, Chinese economic growth and improving living standards are regarded as a threat to the US super-power status in the long run; China's being the new manufacturing center of the world is taken as a factor behind the growing unemployment in the US; and its military and technological modernization is read as signs of China's intention to act aggressively in the future. By and large, Western media institutions seem to have bought into the “China threat” theory –which was coined by the American scholars in the 1990s both as a replacement for the disappearing Soviet threat and a response to China's new economic growth.1 By the 1990s, optimistic analysis in the West which foresaw a radical transformation of the Chinese political system -along the lines of its economic transformation - had faded. The People's Liberation Army's siding with the party leadership in the tragic Tiananmen Incident in 1989 signaled to the world that the Chinese Communist Party was going to remain in power for long years to come. China's economic rise in the last two decades added to the concerns in the Western hemisphere. Today, many observers predict that the 21st century will be a "Pacific century" which the Asian economies -China being the locomotive- will determine the future of the globe. "China threat" discourse is a reaction to this unprecedented growth and the rising international status of China(2 1 For recent examples, See Bush, Richard C., Michael E. O'Hanlon, A War like no other: the truth about China's challenge to America, Hoboken N.J.: John Wiley and Sons, 2007. Also see John Mearsheimer, "The rise of China will not be peaceful at all", Australian, November 18, 2005 and "China's unpeaceful rise", Current History, April 2006 pp.160-162. 2 For a summary of the scholarly debate on the "China threat" model, See Roy, Denny, "The "China Threat" Issue: Major Arguments", Asian Survey, Vol. 36, No. 8, (Aug., 1996), pp. 758-771.

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＂ China threat" model is problematic for a number of aspects. First, it presumes that the status quo, i.e., American hegemony is more beneficial for the world order than any alternative contender might suggest. Secondly, it is based on the theoretical biases of the realist school of the international relations discipline, which presumes that the rise of great powers will inevitably cause disruptive events. According to this line of thought, China's rise cannot be peaceful because the transformation of the inter-state system will sooner or later lead into conflict and war. Thirdly, "China threat" model embraces racially biased and culturally essentialist arguments concerning the Chinese civilization. One of the early representatives of this thought was Samuel Huntington's "Clash of Civilizations", in which the author declared the Confucian civilization to be in direct opposition with the Western values. Other advocates of the "China threat" model base their arguments less on theoretical and more on practical matters. In this line of thought, China's growing military spending often becomes an issue of concern.4 Recently, a Pentagon paper added to this fear and drew attention to the Chinese military build-up 5 Taiwan is regarded as the most likely problem-spot which might potentially trigger a military conflict between China and the US. Some threat analysts also focus on the ideological discrepancies between China and the US. The disparity between the Chinese and American ruling ideologies and world-views is emphasized while China's continuing one-party rule and resistance to democratization are cited as persistent problems. One way or another, the global public opinion on the rise of China is shaped by the Western media and scholarship which tend to be inclined towards the "China threat" 3 This line of argument compares China with 19th century Britain, Soviet Union, Nazi Germany, Pacific War Japan and 20th century America. See Roy, Denny, "The "China Threat" Issue: Major Arguments", Asian Survey, Vol. 36, No. 8, (Aug., 1996), pp. 762. 4 Some authors argue that Chinese military spending does have catch up with the US in order to challenge the American interests in Asia. See Christensen, Thomas J., "Posing problems without catching up", International Security, Vol.25, No.4, (Spring 2001), pp.5-40. 5 For a Chinese critique of the Pentagon paper, See "Pentagon paper shows 'cold war mentality", China Daily, May 25, 2006 http://www.chinadaily.com.cn/china/2006-05/25/content_599683.htm.

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discourse.6 Much fewer studies are conducted with the aim of understanding China's perspective.Based on the recent Chinese sources on foreign policy and international relations, this paper aims to understand China's rise through the eyes of Chinese scholars and officials. Hence this paper will discuss the official foreign policy line of "peaceful rise" as an alternative to the "China threat" discourse. This paper argues that, contrary to the premises of the “China threat” model, China is neither willing, nor able to challenge the US hegemony in the near future. In order to understand to what extent China has posed a threat vis-à-vis the American hegemony so far, it is important to provide a historical background on the Sino-US relations. Sino-US Relations: Continuity and Change If one recalls the Cold War days, one could easily understand the extent of transformation that took place in the Sino-US relations during the recent decades. Throughout the 1950s, unable to get diplomatic recognition from the Western bloc, China leaned on the Soviet Union for ideological, technical, and economic assistance. First major clash between China and the US had been in Korea, which China joined the war on the North Korean side against the UN forces led by the US. Throughout the war years a huge propaganda campaign called "Aid Korea, Resist America" was launched to intensify the antiAmerican sentiment in China. Throughout the 1950s, while China attacked the US for its continuous support of Nationalist Taiwan and its imperialist intrusion into the Asian conflicts such as the War in Vietnam; American side treated the People's Republic both as a Soviet satellite and a suppressive regime lacking domestic legitimacy - constituting the most important threat against the USled alliance in the Asia-Pacific region. By the early 1960s, ideological differences between the USSR and China became public. Subsequent to the Sino-Soviet split, 6 There are also alternative views on China's rise. For instance Avery Goldstein does not See Avery Goldstein, "Great expectations: Interpreting China's arrival", International Security, Vol.22, No.3, (Winter 1997-1998), pp.36-73. Ikenberry, G. John, "The rise of China and the future of the West: Can the liberal system survive?", Foreign Affairs, Vol.87, No.1.

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China was found itself estranged from the Eastern bloc, facing complete isolation in international relations. The radical politics of the Cultural Revolution era caused further chaos in China, paralyzing the Chinese Foreign Ministry and shifting the foreign policy agenda to the export of Mao Zedong thought to foreign revolutionaries. Thanks to the rising anti-Soviet sentiment in China, the Cultural Revolution decade (1966-76), also created new opportunities for the Sino-US relations. After Richard Nixon's famous visit to China in 1972, Sino-US relations gained a more pragmatic momentum. Yet, for both sides, this initial period of bilateral contact was aimed at containing Soviet power rather than building stable relations with each other. By 1978, China under Deng Xiaoping's leadership eliminated the cultural revolutionary cadres and largely refrained from the revolutionary ideological discourse in its foreign policy. Sino-US relations entered a new era under Deng's opening-up reforms which aimed at modernizing the country and was accompanied by the socio-cultural movement of "Western learning". However, the reforms and the abrupt cultural change, combined with the unexpected end of the Cold War, proved to be discomforting for the leadership. Tiananmen incident of 1989 was the biggest mass movement against the CCP leadership and its forceful suppression by the PLA troops strained relations with the US. While the CCP leadership pictured the demonstrators as counter-revolutionaries backed by foreign powers, Western public opinion supported them as prodemocracy elements and regarded the suppression of the movement as a grave insult to human rights which deserved harsh condemnation. Although Sino-US relations improved throughout the 1990s, due to Clinton administration's tendency towards a more proactive policy of engagement (vis-à-vis the containment strategy), mutual suspicions were hard to erase. In 1995, two years after the US administration revoked economic sanctions imposed after the Tiananmen incident, Taiwan Straits crisis broke. The basis of the problem was the American government's issuance of a formal visa 125

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for the President of Taiwan, Lee Teng Hui for a short trip to the US. This was interpreted by China as a de facto move towards Taiwan's independence and against the norms of bilateral conventions which the US agreed to observe "One China" principle. Taiwan Straits Crisis of 1996 was followed by another diplomatic crisis in 1999, due to the accidental bombing of the Chinese embassy in Belgrade by the NATO forces. Despite the US declarations to the contrary, Chinese government and the masses who expressed their anger at the demonstrations, believed that the bombing was intentional. Similar protests took place in 2001, when an American spy-plane landed on the Hainan Island after causing a Chinese pilot crash over the South China Sea. Although these incidences added to the mutual lack of trust between the two countries and contributed to the popularity of the "China threat" discourse, 1990s was also a decade of expanding economic relations. Clinton administration's definition of Sino-US relations as "strategic partnership" in this era is important for it displays the extent of mood change since the Tiananmen incident. The content of this "strategic partnership" was later broadened ironically during the George W. Bush administration, which criticized Clinton's soft policy on China and showed the tendency to re-define Sino-US relations as "strategic rivalry". However, the 9/11 event drastically changed Bush government's understanding of China.7 After 9/11, differences were set aside and China was considered a strategic ally in the War against Terror. Since 2001, China, although voicing disagreement against certain examples of American unilateralism, i.e., US invasion of Iraq, refrains from confronting the US. China often uses the UN mechanism to encourage peaceful negotiations to end international conflicts and resist American foreign policy Most recent Sino-US differences

7 See Zheng Baoguo, "9.11 hou zhong mei guanxi wushi pinggu" (Comprehensive Assessment of Sino-US relations after 9.11 incident) , Wuhan Daxue Xuebao –zhexue shehui kexue ban (Wuhan university journal-philosophy and social sciences) Vol.60, No.2 March 2007, pp.183-188.

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occurred in the Kosovo8 and Darfur issues. Some observers argue that China's friendly relations with the countries listed by the US as "terrorist states" justify fears about China. Yet, it is also possible to explain China's relation with Venezuela, Iran, and Sudan with its vulnerability in energy sources. Due to its enormous economic growth, China has become the biggest consumer of oil and gas; and its dependence on foreign oil necessitates favorable relationship with these countries. 　 Differences aside, Sino-US relations continued to grow in the recent years and there are many international issues which the two powers collaborate their forces, such as disarmament, prevention of diseases, and economic globalization. The six-party talks to achieve the nuclear disarmament of North Korea is perhaps the most important example of Sino-US co-operation, which, even the most arduous advocates of the "China threat" theory cannot deny China's contribution. If one looks at the China's overall foreign policy record in the post-Cold War era, one will see that China acted in with respect to the international law. This is also acknowledged by certain officials in the US government, one of whom recently referred to China as a "responsible stakeholder" in the maintenance of a peaceful international order.9 Main potential for conflict in the Sino-US relations are also matters which cause the greatest anxiety for China in the conduct of its foreign policy. Chinese leadership is 8 See "Foreign Minister M Yang Jiechi Accepts an Interview in Writing by Interfax" at the PRC Foreign Ministry website (http://www.fmprc.gov.cn/eng/zxxx/t418335.htm) (accessed April 29, 2008) The Foreign Minister asserts that: "China is severely concerned of the unilateral declaration of independence by Kosovo. The unilateral move taken by Kosovo would result in a series of consequences and exert extremely negative influence on the peace and stability in the Balkan region and the fulfillment of the goal of establishing a multi-ethnic society in Kosovo. The Kosovo issue is a matter affecting the peace and stability in the Balkan region, the basic norms governing international relations and the authority and role of the UN Security Council. The Chinese side holds the view that Serbia and Kosovo should reach a solution acceptable to both parties and that is the best way out to the Kosovo issue. China calls for Serbia and Kosovo to find proper solutions through negotiations within the framework of international laws. The international community should create favorable conditions for their negotiations. 9 This speech was made by then Deputy Secretary of State, Robert B. Zoellick on December 2005. This vision is also celebrated by Chinese scholars who hold an optimistic vision about the Sino-US relations. For a specific example, See Yu Wangli, "Zhongguo kuaisu fazhan xia de zhong mei guanxi" (Sino-US relations in the era of China's fast development) Guancha yu sikao, (Observation and Thinking) No.10, 2007, pp.20-21.

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the most sensitive in matters concerning the territorial integrity of China, such as Taiwan, Tibet, and Xinjiang. Most likely to cause problems for Sino-US relations among the three is Taiwan, which the US still maintains its security commitments and bilateral relations though not on a regular diplomatic basis. Yet, with the proindependence leader Chen Shui-Bian's fall from grace and subsequent defeat of the Democratic Progressive Party in the latest presidential elections, there are better prospects for PRC-Taiwan relations on the horizon. The new Kuomintang leadership already started high-level talks with the mainland, an attempt which is regarded as a historical turning point for the betterment of PRCTaiwan relations. In the absence of frictions over Taiwan in the near future, there is little substantial evidence to justify the alarmist views of the "China threat" discourse. Here, it is also significant that both presidential candidates in the coming US elections refrained from identifying China as a threat.10 Now, let us focus on the guidelines of Chinese foreign policy in the 21st century and analyze how Chinese elites see their own country's rise. Chinese Perspective: Rise of the “Peaceful Rise” Discourse Since the 1990s, a growing number of Chinese intellectuals are analyzing their country's rise and offering policy guidance on 10 Barack Obama, U.S. Senator (D-IL), in the Apr. 26, 2007 Democrats' First 2008 Presidential Debate, hosted by MSNBC and held in Orangeburg, SC, stated:"Japan has been an outstanding ally of ours for many years, but obviously China is rising, and it's not going away. They're neither our enemy nor our friend. They're competitors. But we have to make sure that we have enough military-to-military contact and forge enough of a relationship with them that we can stabilize the region."; John McCain, U.S. Senator (R-AZ), stated in a Nov./Dec. 2007 Foreign Affairs article titled "An Enduring Peace Built on Freedom: Securing America's Future":"China could also bolster its claim that it is 'peacefully rising' by being more transparent about its significant military buildup. When China builds new submarines, adds hundreds of new jet fighters, modernizes its arsenal of strategic ballistic missiles, and tests anti-satellite weapons, the United States legitimately must question the intent of such provocative acts. When China threatens democratic Taiwan with a massive arsenal of missiles and warlike rhetoric, the United States must take note. When China enjoys close economic and diplomatic relations with pariah states such as Burma, Sudan, and Zimbabwe, tension will result. When China proposes regional forums and economic arrangements designed to exclude America from Asia, the United States will react. China and the United States are not destined to be adversaries. We have numerous overlapping interests. U.S.-Chinese relations can benefit both countries and, in turn, the Asia-Pacific region and the world. But until China moves toward political liberalization, our relationship will be based on periodically shared interests rather than the bedrock of shared values. Some Americans see globalization and the rise of economic giants such as China and India as a threat. We should reform our job training and education programs to more effectively help displaced American workers find new jobs that take advantage of trade and innovation. But we should continue to promote free trade, as it is vital to American prosperity." See http://www.2008electionprocon.org/chinathreat.htm#clinton

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China's new international status. As the opening-up reforms enabled the Chinese scholars to have increasing access to the Western academia, Western studies started to influence Chinese scholars' perception of their national identity. Today, Chinese scholars are well aware of the "China threat" discourse and its potentially negative consequences for China's rise. For this reason, this theory is being attacked by Chinese scholars and officials on various theoretical and practical grounds. Yet another impact of the "China threat" discourse, according to Peter Hays Gries, has been its contribution to the climbing self-esteem among the Chinese nationalists: (“They see us as a threat! We've finally gained our great power status.”)11 　 In the last decade, Chinese scholars adopted several methods to convince the global audiences that China does not constitute a threat to the international order. Some of these justifications are based on historical evidence. Attacked by the culturally essentialist arguments of their Western counterparts, Chinese scholars also derive their answers from the past, providing equally essentialist arguments. For instance, the critique of Samuel Huntington's “Clash of Civilizations” is made by arguing that China is inherently a peaceful nation.12 The cultural alternative to "China threat" model uses examples from the imperial history, traditional Chinese culture, and Confucian philosophy to establish a future framework for China's rise. According to this line of thought, the evidence for China's peaceful rise in the 21st century can be found in the past: China never employed imperialist policies; Confucian philosophy which is the essence of Chinese civilization emphasizes peace over military struggle and social harmony over conflict.13 In 2003, Zheng Bijian,14 a leading intellectual who held several positions in 11See Peter Hays Gries, China's New Nationalism, Pride, Politics and Diplomacy, Berkeley: University of California Press, 2004.p.40. 12 Wang Shouren; Zhao Wenshu, "China's peaceful rise: A cultural alternative", boundary 33:2, Summer 2006. 13 For example, see Ma Jianzhong, "Zhongguo gongchandang yu zhongguo de heping jueqi—Jinian zhongguo gongchandang chengli 85 zhounian" (Chinese Communist Party and the peaceful rise: Commemorating the 85. anniversary of the CCP's foundation) Shanxi sheng zhengzhi xuehui jinian jian dang 85 zhounian lilun yantao hui lunwen ji, 2006, p.16. 14 Since 2002 Zheng Bijian heads the China Reform Forum, an official think tank which has become influential in developing strategic thinking in the new era. See Zheng Bijian, China's peaceful rise: Speeches of Zheng Bijian 1997-2005, Washington D.C.: Brookings Institution Press, 2005, p.v.

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government organizations and think tanks, used the term "peaceful rise"15 for the first time. Soon, Premier Wen Jiabao and President Hu Jintao cited this term in their public speeches, which signaled to the world that this term now became official currency. The term "peaceful rise" was devised to counter the "China threat" discourse at the ideological level and should be regarded as China's policy of reassurance towards the West. Although "peaceful rise" stands for the official line of foreign policy, it is hard to see it as a unanimously agreed alternative on the future of China's rise: Zheng's initial discussion of peaceful rise was met by opposition from many influential minds in China. Opposition to the idea came from many points of view. Some thinkers argued the theory's focus on peace made China look weak, while others argued that the idea was too simplistic for a complex world. Yet another criticism was that Zheng's theory was naïve, since the United States and other established powers won't, in these critics' view, permit China to rise at all, let alone peacefully. For many China observers, however, this energetic debate about Chinese grand strategy was in itself promising, proof of increasing openness in discussion about what direction the country should toward look for its future as a global power.16 As this example shows, many Chinese scholars are critical of the US power and fear that this country might prove to be the greatest obstacle in front of China's peaceful rise.17 15 Since April 2004, the term "peaceful development" is used more often than the "peaceful rise" which drew criticism inside China. See Cheng, Joseph Y.S., "China's Peaceful RiseSpeeches of Zheng Bijian, 1997-2005", Journal of Contemporary Asia, Feb.1, 2007, pp.132-134. 16 Zheng Bijian, China's peaceful rise: Speeches of Zheng Bijian 1997-2005, Washington D.C.: Brookings Institution Press, 2005, p.vi. 17 Peter Hays Gries explains: "Chinese analysts and commentators worry that U.S.-China relations are friendly today only because of 9/11 and the United States' involvement in Iraq. Fortune in the guise of Saddam Hussein and Osama bin Laden has, in their view, brought China a brief reprieve from America's wrath. Most doubt that America's preoccupation with the Middle East will last long and fear that it is only a matter of time before Bush administration ''hawks'' and ''neocons'' redirect their ire back at China. Unlike their American counterparts, Chinese analysts do not assume that America's hegemony is or will become benign. An American empire, many Chinese increasingly fear, will not just seek to contain China's foreign policies, but will also actively seek to recreate China's society and polity in its own image. To many Chinese, these are far from the best of times." See Peter Hays Gries, "China Eyes the Hegemon", Orbis: A Journal Of World Affairs, Summer 2005, pp. 401-412.

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Others hold more optimistic opinions on China's rise and they see the US power in relative decline.18 But hardly anyone denies that there are still structural contradictions between the foreign policies of China and the United States. Most important of these contradictions are the Taiwan problem, conventional security issues, human rights problem, commercial-economic issues and non-conventional security issues.19 The core of the "peaceful rise" perspective is based on the idea that China is facing domestic challenges whose solutions require the steady economic development of the country. Hence "peaceful rise" emphasizes China's weaknesses rather than its strengths. For instance, per capita income in China is still very low, economic development in the country is unequal and there are surging environmental problems. So China cannot isolate itself from the globalization process but needs to be a part of it. In other words, Chinese are trying to reassure the world that despite its enormous growth rates, China is still a developing country: Without a doubt, in aggregate terms China is an economic power whose rapid growth is felt by the whole world. Yet China's economy in 2003 was just oneseventh the size of the U.S. economy, and one-third the size of Japan's. In per capita terms, China is still a lowincome developing country, ranking below onehundred in the world. Our impact on the world economy is limited, after all. Therefore, in the final analysis, all of our efforts to resolve problems of development focus on bettering the lives of our 1.3 billion—or even 1.5 billion—people, and creating an increasingly more prosperous and civilized environment suitable for their comprehensive development. This work alone will keep several generations of the Chinese people quite busy.20 18 See Peter Hays Gries, "China Eyes the Hegemon", Orbis: A Journal Of World Affairs, Summer 2005, pp. 405. 19 Fan Hongyun, "Zhongguo heping jueqi yu guoji zhixu" (China's peaceful rise and international order) Tequ shixian yu lilun, No.1, 2007, p.50. 20 "China's development and her new path to a peaceful rise –Villa d'Est Forum (September 2004) " in Zheng Bijian, China's peaceful rise: Speeches of Zheng Bijian 1997-2005, Washington D.C.: Brookings Institution Press, 2005, p.vi.

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The close link between domestic and foreign policy and the leadership's perception as such is also shared by certain liberal scholars in the West.21 The economic growth can only be achieved within the current international order relying on the regional and international co-operation offered by the globalization drive. According to Premier Wen Jiabao: "China will make most of the era of world peace to develop and also contribute to the world peace with its development; it will basically depend on its own strength, its domestic market and labor force, while continuing with the opening-up reforms and not isolating itself from the world. Premier Wen defines "peaceful rise" as a long-term process, in the course of which China will not threaten anyone or seek hegemony".22 The "peaceful rise" strategy is based on the "five principles of peaceful co-existence" which China formulated in the signing of a 1954 non-aggression pact with India. These five principles are: "mutual respect for each other's territorial integrity and sovereignty; mutual non-aggression; mutual non-interference in each other's internal affairs; equality and mutual benefit; peaceful co-existence". The five principles later became the cornerstone of the Chinese foreign policy and still serve as a basis for establishing diplomatic relations with other countries.23 21 Susan L. Shirk's "China: Fragile superpower" is an important example. See Zhong Longbiao, Wang Jun, "Zhonggo heping jueqi zhong de "shuang ceng boyi" –Zhongguo: cuiruo de chaoji daguo" pingjia" (Two-layered game in China's peaceful rise: Book review of "China: Fragile Superpower") Meiguo yanjiu, No.4, 2007. 22 Hu Mo, "Heping jueqi zhanlüe xia de zhongguo zhengzhi anquan tanwei", (Study of Chinese political security under the peaceful rise strategy) Dazhou zhiye jishu xueyuan xuebao (Journal of Dazhou Vocational and Technical College), Issue 3-4, Dec. 2006, p.35. 23 Premier Wen Jiabao explains the significance of Five Principles as follows: "Enshrined in China's Constitution, the Five Principles have long been held as the cornerstone of China's independent foreign policy of peace. It is on the basis of the Five Principles that China has established and developed diplomatic relations with 165 countries and carried out trade, economic, scientific, technological and cultural exchanges and cooperation with over 200 countries and regions. It is on the basis of the Five Principles that China has, through peace negotiations, resolved the boundary issues with most neighbors and maintained peace and stability in its surrounding areas. And it is on the basis of the Five Principles that China has provided economic and technical aid with no political strings attached to other countries in Asia, Africa and Latin America, strengthening the friendship between China and these countries. Particularly, since the beginning of the reform and opening up, China has improved and upgraded its mutually beneficial cooperation with all countries regardless of social system and development level, and contributed its share to world peace and common development. All this is inseparable from our firm, sincere and innovative adherence to the Five Principles of Peaceful Coexistence." See Wen Jiaobao "Carrying Forward the Five Principles of Peaceful Coexistence in the Promotion of Peace and Development" (June 28, 2004 )on the PRC Foreign Ministry web site. http://www.fmprc.gov.cn/eng/topics/seminaronfiveprinciples/t140777.htm.

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«Peaceful rise" also has political significance in the national and international context: Ma Jianzhong summarizes these under five major headings: 1. realizing the historical greatness of the Chinese nation; 2. completing the unification process of the motherland (i.e., Taiwan); 3. transforming the international economic and political system; 4. contributing to the world peace and stability; 5. providing the developing countries with the example of Chinese modernization.24 Hence "peaceful rise" strategy is not only beneficial for the development of China, but is also going to have a positive impact on the world. According to Wang Yibo, while "peaceful rise" will help lift China's international status and lead into the realization of its foreign policy goals, it will also help the democratization of the international relations and promote the multi-polarity, help realize world peace. 25 Here, it is important to note that the Chinese scholars derive lessons from the previous examples of Germany and Japan. As they see it, these powers tried to change the international system by force in the 20th century and they were ultimately defeated. Hence, this mistake could not be repeated by China.26 Of course, this also aims to counter the realist school of international relations, which uses these examples as justification for the assumption that the rise of great powers cannot be peaceful. Some scholars cite the peaceful rise of Europe in the second half of the 20th century to further challenge the realist school.27 Yet, the "peaceful rise" strategy has its limitations. The advocates of this strategy indicate that China's commitment to the "peaceful rise" is basically that China will not seek hegemony or try to alter the international system by the use of force. However, as the authors indicate, this does not mean that 24 Ma Jianzhong, "Zhongguo gongchandang yu zhongguo de heping jueqi—Jinian zhongguo gongchandang chengli 85 zhounian" (Chinese Communist Party and the peaceful rise: Commemorating the 85. anniversary of the CCP's foundation) Shanxi sheng zhengzhi xuehui jinian jian dang 85 zhounian lilun yantao hui lunwen ji, 2006 pp.17-18. 25 Wang Yibo, "Zhongguo heping jueqi dui guoji zhengzhi guanxi de yingxiang fenxi" (Analysis of the impact of China's peaceful rise on international political relations) Xiangchao (Xia banyue) (Lilun), No.12, Dec. 2007, pp.17-18. 26 Hu Mo, "Heping jueqi zhanlüe xia de zhongguo zhengzhi anquan tanwei", (Study of Chinese political security under the peaceful rise strategy) Dazhou zhiye jishu xueyuan xuebao (Journal of Dazhou Vocational and Technical College), Issue 3-4, Dec. 2006, p.36. 27 Fan Hongyun, "Zhongguo heping jueqi yu guoji zhixu" (China's peaceful rise and international order) Tequ shixian yu lilun, No.1, 2007, p.50.

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China will avoid war at all costs. In other words, Chinese perspective does not rely on unrealistically optimistic predictions about the future and the country will not refrain from developing a powerful defense capability in accordance with the times.28 Here, Taiwan's independence is given as the major example of an issue for which the mainland could risk war. However, even such conflicts are regarded as short-term and something that will not effect the long-term policy of "peaceful rise." Here, one of the main arguments of the Western "China threat" advocates is answered. The rise of the China's military budget is explained as a necessary precaution to a probable conflict which will not be initiated by the Chinese side. Another important issue here is that the Chinese side emphasizes that the "China threat" advocates use biased statistics. Here, it is important to note that, even with its significant budgetary rise, Chinese military spending accounts for only 7% of the US military budget.29 Besides, this figure does not only reflect the money spent on new weapons systems but includes the money spent on improving the living standard of Chinese army personnel.30 Yet another justification put forward by the Chinese officials is the fact that China has a long and vulnerable maritime border. In actuality, the bulk of the military spending is concentrated in the region facing the Taiwan Straits. 28 Jin Yun, "Zhongguo heping jueqi zhanlüe de tichu ji qi yiyi" (Formulation of the peaceful rise strategy and its meaning) Jianghuai luntan, No.6, 2007, p.27. 29 Government statistics show that China's expenditure on national defense totaled 244.6 billion Yuan (US$30.5 billion) last year, about 7 per cent of the US defense budget. The US' military expenditure per capita is 60 times that of China's. See "Pentagon paper shows 'cold war mentality'", China Daily, May 25, 2006 http://www.chinadaily.com.cn/china/2006-05/25/content_599683.htm. 30 See "Foreign Ministry Spokesman Qin Gang's Regular Press Conference on 21 March 2006" at the PRC Foreign Ministry website: (http://www.fmprc.gov.cn/eng/xwfw/s2510/t241731.htm) accessed on April 29, 2008."Regarding China's defensive national defense policy, we have said on many occasions that China's defense policy is of a defensive nature. We have a 22,000 kmlong land borderline and a lengthy maritime border. It is an unquestionable mandate for every sovereign country in the world to safeguard its national sovereignty, territorial integrity and security. China's national defense is first and foremost aimed to defend China's sovereignty, security and territorial integrity. China's military expenditure has to meet the demand of the development of our military forces in the new context, including that of improving the livelihood and welfare of the men and women in uniform. In response to the overall improvement of economy, the treatment for servicemen and servicewomen should be elevated accordingly. Given that the pay raise of civil servants is legitimate, why is it not for the people in service? China is unflinching on its way of peaceful development, and China will make its due contributions to the peace, stability and common development of the world.

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According to the Chinese scholars, this process is not going to be achieved easily and the "peaceful rise" strategy will bring its own challenges to the domestic security environment. As Hu Mo bluntly puts, these challenges are the "continuing ambition of the Western enemies to westernize us and their plots to split out country" and the "foreign intervention into our political system and domestic political life".31 As the above examples show, the US and Chinese perspectives on China's rise vary greatly: … people in both China and the US have different perceptions of China's rise. The Chinese focus more on potential risks and challenges, while Americans are concerned more about the impact and influence of China's rise on America's interests in the Asia-Pacific region and the rest of the world. In other words, Americans exaggerated China's rise because it sounds more reasonable from the perspective of policy-making and threat assessment. More importantly, US policy towards China is based on an 'American' perception of China, not on a 'Chinese' perception.32 But how do the Chinese people perceive their country's own rise? As the economic growth in China is experienced differently in urban and rural areas, it is hard to make a generalization. There are multiple perspectives in the Chinese society and arguably the tendency is towards cautious optimism. Although there is a general betterment in the living standards as compared to the pre-reform era, most people also feel the challenges of the new era. With the closing of the government industries, "iron rice bowl" is no longer an option and jobs are much more competitive. Despite the government's efforts in implementing the new labor law; health insurance, retirement plans, and paid vacations are still luxuries that the lower classes cannot enjoy. Hence, although generally optimistic about the future of their country, the pressing domestic issues still weigh highly on the Chinese citizens' agenda. 31Hu Mo, "Heping jueqi zhanlüe xia de zhongguo zhengzhi anquan tanwei", (Study of Chinese political security under the peaceful rise strategy) Dazhou zhiye jishu xueyuan xuebao (Journal of Dazhou Vocational and Technical College), Issue 3-4, Dec. 2006, p.37. 32 Yuan Peng, "Sino-American relations: new changes and new challenges", Australian Journal of International Affairs, Vol.61, No.1, March 2007, pp.98-113.

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Chinese public's perception of the United States also varies. According to a recent survey, Chinese people's perception of America is more positive than the Americans' perception of the Chinese.33 However, both sides agree that the expansion of the Sino-US commercial relations is beneficial for the national economies.34 The business communities' approach towards the US is rather pragmatic. In the recent decades, China has become the most important trade partner for the US in consumption goods.35 Although the trade balance favors China it is also true that the country has become an important market for American products.36 By the end of 2007, the US has become the sixth largest investor in China, its cumulative investment being estimated around $57 billion.37 It is hardly any news to China observers that the American fast food restaurants such as McDonalds and KFC 33 According to the key findings of the survey conducted by the Committee of 100, 60% of the Chinese public surveyed had a favorable impression of the United States, while 26% had an unfavorable view. This contrasts with a 52% favorable rating, and a 45% unfavorable rating, of China by the American public. See "New C-100 Mirror Survey of Chinese and Americans Shows Mutual Perceptions are Characterized by Both Hope and Fear", Committee of 100 press release, December 10, 2007. 34 When the surveyors were asked if the bilateral trade benefits their national economies, in the United States, 72% of the general public surveyed “strongly agree” or “somewhat agree” that trade with China benefits the U.S., while 27% “strongly disagree” or “somewhat disagree.” In China, the figures are even higher: 82% “strongly agree” or “somewhat agree” that trade with the U.S. benefits China, while only 7%“strongly disagree” or “somewhat disagree.” 35 Total two-way trade between China and the United States grew from $33 billion in 1992 to over $386 billion in 2007. The United States is China's second-largest trading partner, and China is now the third-largest trading partner for the United States (after Canada and Mexico). U.S. exports to China have been growing more rapidly than to any other market (up 21% in 2005, 32% in 2006, and 18% in 2007). U.S. imports from China grew 12% in 2007, bringing the U.S. trade deficit with China to $256 billion. (…) The U.S. trade deficit with China reached $256.3 billion in 2007, as imports grew 12%. China's share of total U.S. imports has grown from 7% to 16% since 1997. At the same time, the share of many other Asian countries' imports to the United States and the U.S. trade deficit with the Asia-Pacific region as a whole have fallen. U.S. goods exports to China in 2007 accounted for 5.7% of total U.S. goods exports, up from 1.9% in 1997. See US Department of State web site, http://www.state.gov/r/pa/ei/bgn/18902.htm. 36 China is now one of the most important markets for U.S. exports: in 2007, U.S. exports to China totaled $65.2 billion, more than triple the $19 billion when China joined the WTO in 2001. U.S. agricultural exports have increased dramatically, making China our fourth-largest agricultural export market (after Canada, Japan, and Mexico). Over the same period (2001-2007), U.S. imports from China rose from $102 billion to $321.5 billion. Export growth continues to be a major driver of China's rapid economic growth. To increase exports, China has pursued policies such as fostering the rapid development of foreign-invested factories, which assemble imported components into consumer goods for export, and liberalizing trading rights. See US Department of State web site http://www.state.gov/r/pa/ei/bgn/18902.htm. 37 US direct investment in China covers a wide range of manufacturing sectors, several large hotel projects, restaurant chains, and petrochemicals. US companies have entered agreements establishing more than 20,000 equity joint ventures, contractual joint ventures, and wholly foreign-owned enterprises in China. More than 100 US-based multinationals have projects in China, some with multiple investments. Cumulative US investment in China is estimated at $57 billion, through the end of 2007, making the United States the sixth-largest foreign investor in China. See the US Department of State web site, http://www.state.gov/r/pa/ei/bgn/18902.htm.

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can be found in almost every neighborhood at the urban centers in China. Other consumption patterns also reflect the changing tastes and appreciation of American culture, from the NBA league to the famous American brands in fashionable sportswear. Popular TV shows such as Prison Break or Lost are followed closely by the Chinese youth as the internet makes access much easier and cheaper. The business culture in China is in a rapid transformation process and the American consultants and businessmen are regarded as crucial for their contributions in terms of their management expertise and technological know-how. Since the opening-up reforms, Sino-American cultural relations developed at an enormous speed. There are thousands of Chinese students who receive higher education in the American universities and these find very competitive career positions if and when they return to China. Being fluent in English is an asset in China as in the rest of the world and "American accent" is very much favorable to others. English classes can be found everywhere and most schools prefer to employ native speakers as teachers. Another new cultural link is established by thousands of American families who have adopted orphaned Chinese children especially girls since the 1990s. Often these families function as a bridge between two countries by bringing their adopted children to China to learn about this culture. Tourists and Chinese learners also serve a similar purpose. CONCLUSION Today's China is an integral part of the world community. This also means that China will promptly respond to the matters raised by the US and other Western powers, especially in matters very dear to China such as Tibet, Taiwan, Xinjiang, and Hong Kong. Advice on these issues is received by the Chinese government as an intervention into its domestic politics and attempts to undermine its territorial integrity. These issues provoke the memories of 19th century, which is remembered in communist China as the century of humiliation. In the post-Cold War China, these sentiments are no longer controlled by the government and one incident could trigger thousands of people to gather in antiWestern demonstrations. Yet, this should not take us from seein 137

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g the real dynamics of China's rise and its relations with the United States. In today's China, everyone -including the highest officials- is well aware that the country cannot maintain its economic growth in isolation from the international community. At the 17th National Congress of the CCP which was held on October 15, 2008, the Chinese leaders reconfirmed their will to continue the policy of "peaceful development." This also means the continuance of a foreign policy line which is in favor of multi-polarity and the peaceful resolution of international conflicts through negotiations vis-à-vis the American hegemony: All countries should uphold the purposes of the United Nations Charter, observe international law and universally recognized norms of international relations, and promote democracy, harmony, collaboration and win-win solutions in international relations.38 The resolutions of the 17th CCP Congress is in line with the post-Cold War Chinese foreign policy, which made the country a part of the globalization drive and achieved a major economic transformation. This line of foreign policy also emphasizes China's willingness to be a part of the current international order. Indeed, recent foreign policy record of the Chinese regime shows that the country came a long way in adapting itself into the Post-Cold War international order. China's active participation in the international organizations and its mediating role in important political disputes such as the disarmament of the Korean Peninsula are important examples. In the past decades, China differed from the US in its analysis of major international problems, Iraq War, Darfur and Kosovo being major examples. However, in these instances of disagreement, China refrained from directly countering the US position. This is mostly due to the country's concern with its domestic economic situation whose stability and growth partly relies on the uninterrupted flow of its exports to the US and the 38 Documents of the 17th National Congress of the Communist Party of China, Beijing: Foreign Languages Press, 2007, p.59.

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American capital into China. As long as the preoccupation of the Chinese leaders remains with the domestic growth, this general pattern will remain in force. Although Chinese economic growth has been significant for the last three decades, it is certain that China will remain a developing country in terms of per capita income levels. As Susan L. Shirk explains in her China: Fragile Superpower,39 domestic problems will weigh heavy on the Chinese foreign policy agenda. Besides, neither in military spending nor in general living standards China is likely to catch up with the US in the near future. Due to the catastrophic events in its modern history, when China was colonized, invaded, humiliated, and isolated from the rest of the world, today's China is proud to get its power status back and seeks recognition for its efforts. This is also shared by common people who showed their sincere joy in welcoming the opportunity to become a member of the World Trade Organization in 2001 and to host the 2008 Olympics in Beijing. Hence, how things will turn out in China's nationalism also lies on the shoulders of Western powers. If the foreign policy makers in the US and other major western powers attempt to isolate China by subscribing to the "China threat" discourse, it might trigger the historical anxiety in China. China's international policy record in the post-Cold War era is flawless in terms of its compliance with the international norms and rules of conduct. "Peaceful rise" discourse also indicates this will remain so unless a significant crisis endangers its territorial integrity. Despite the liberal public opinion in the US which advice to the contrary, American government is not likely to openly challenge China in Taiwan, Tibet or Xinjiang. Taiwan seemingly is not going to be a problem spot in the near future as the newly elected leadership, as opposed to the previous Chen Shui Bian leadership, is more interested in negotiating with the mainland officials. 39 "Zhonggo heping jueqi zhong de "shuang ceng boyi" –Zhongguo: cuiruo de chaoji daguo" pingjia" (Two-layered game in China's peaceful rise: Book review of "China: Fragile Superpower") Meiguo yanjiu, No.4, 2007.

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Bibliography Baoguo, Zheng. "9.11 hou zhong mei guanxi wushi pinggu" (Comprehensive Assessment of Sino-US relations after 9.11 incident), Wuhan Daxue Xuebao –zhexue shehui kexue ban (Wuhan university journal-philosophy and social sciences) Vol.60, No.2 March 2007, pp.183-188 Bijian, Zheng. China's peaceful rise: Speeches of Zheng Bijian 1997-2005, Washington D.C.: Brookings Institution Press, 2005 Bush, Richard C., Michael E. O'Hanlon, A War like no other: the truth about China's challenge to America, Hoboken N.J.: John Wiley and Sons, 2007 Cheng, Joseph Y.S., "China's Peaceful Rise--Speeches of Zheng Bijian, 1997-2005", Journal of Contemporary Asia, Feb.1, 2007 Christensen, Thomas J., "Posing problems without catching up", International Security, Vol.25, No.4, (Spring 2001), pp.5-40 "Daguo jueqi de leixing xue fenxi –jianlun zhongguo heping jueqi zhanlüe de kexingxing" (Analysis of the models for the rise of great powers: Feasibility of China's peaceful rise strategy) Jiangnan daxue xuebao (renwen shehui kexue ban) No.1, 2007 Documents of the 17th National Congress of the Communist Party of China, Beijing: Foreign Languages Press, 2007 Erbing, Li. ed., 21 Shiji qianqi duiwai zhanlüe de xuanze (China's foreign strategy: A choice in the early period of the 21st century) Beijing: Shishi Press, 2004 Goldstein, Avery, "Great expectations: Interpreting China's arrival", International Security, Vol.22, No.3, (Winter 1997-1998), pp.36-73 Gries, Peter Hays, "China Eyes the Hegemon", Orbis: A Journal Of World Affairs, Summer 2005, pp. 401-412. Gries, Peter Hays, China's New Nationalism, Pride, Politics and Diplomacy, Berkeley: University of California Press, 2004. 140

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Hongyun, Fan. "Zhongguo heping jueqi yu guoji zhixu" (China's peaceful rise and international order) Tequ shixian yu lilun, No.1, 2007, pp.48-64 Ikenberry, G. John, "The rise of China and the future of the West: Can the liberal system survive?", Foreign Affairs, Vol.87, No.1 Jia, Qingguo, "Peaceful development: China's policy of reassurance", Australian Journal of International Affairs, Vol.59 No.4, December 2005, pp.493-507 Jianzhong, Ma. "Zhongguo gongchandang yu zhongguo de heping jueqi—Jinian zhongguo gongchandang chengli 85 zhounian" (Chinese Communist Party and the peaceful rise: Commemorating the 85. anniversary of the CCP's foundation) Shanxi sheng zhengzhi xuehui jinian jian dang 85 zhounian lilun yantao hui lunwen ji, 2006 Jin, Yun, "Zhongguo heping jueqi zhanlüe de tichu ji qi yiyi" (Formulation of the peaceful rise strategy and its meaning) Jianghuai luntan, No.6, 2007 Li, Gong &, Liu Dexi, Liu Jianfei, Wang Hongxu eds., Heping weishang: Zhongguo duiwai zhanlüe de lishi yu xianshi (Paramount peace: The history and reality of China's foreign strategies) Beijing: Jiuzhou Press, 2007 Mearsheimer, John, "The rise of China will not be peaceful at all", Australian, November 18, 2005 Mearsheimer, John, "China's unpeaceful rise", Current History, April 2006 pp.160-162 Mo, Hu. "Heping jueqi zhanlüe xia de zhongguo zhengzhi anquan tanwei", (Study of the Chinese political security under the peaceful rise strategy) Dazhou zhiye jishu xueyuan xuebao (Journal of Dazhou Vocational and Technical College), Issue 3-4, Dec. 2006, pp.35-39 Osius, Ted, "Discussion of 'The rise of China' in the Chinese eyes", Journal of Contemporary China, 2001, (10) 26, pp.41-44 Peng, Yuan. "Sino-American relations: new changes and new challenges", Australian Journal of International Affairs, Vol.61, No.1, March 2007, pp.98-113 141

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Roy, Denny, "The "China Threat" Issue: Major Arguments", Asian Survey, Vol. 36, No. 8, (Aug., 1996), pp. 758-771 Shilun shehui zhuyi zhongguo de heping jueqi zhanlüe" (Disscussing socialist China's peaceful rise strategy) Hubei jingji xueyuan xuebao, (renwen shehui kexue ban), No.2, 2007 Shouren, Wang & Zhao Wenshu, "China's peaceful rise: A cultural alternative", boundary 33:2, Summer 2006 Wang, Yibo. "Zhongguo heping jueqi dui guoji zhengzhi guanxi de yingxiang fenxi" (Analysis of the impact of China's peaceful rise on international political relations) Xiangchao (Xia banyue) (Lilun), No.12, Dec. 2007, pp.17-18 Wangli, Yu. "Zhongguo kuaisu fazhan xia de zhong mei guanxi" (Sino-US relations in the era of China's fast development) Guancha yu sikao, (Observation and Thinking) No.10, 2007, pp.2021 "Wenshi yu wubei –Zhongguo heping jueqi de neizai bianzheng guanxi" (Civilian affairs and Military defense- Internal dialectics of China's peaceful rise), Shehui kexue luntan (xueshu yanjiu juan), No.12, 2007 "Wo guo heping jueqi de zhanlüe sixiang he jucuo" (Strategical thought and practice of our country's peaceful rise), Binzhou zhiye xueyuan xuebao, No. 2, 2006 Zheng, Yongnian. Discovering Chinese nationalism in China: Modernization, Identity and International relations, New York: Cambridge University Press, 1999 Zhong, Longbiao. Wang Jun, "Zhonggo heping jueqi zhong de "shuang ceng boyi" –Zhongguo: cuiruo de chaoji daguo" pingjia" (Two-layered game in China's peaceful rise: Book review of "China: Fragile Superpower") Meiguo yanjiu, No.4, 2007 "Zhongguo shi jueqi: Changqi de heping fazhan yu gongping de hexie fazhan" (China attemps to rise: peaceful development in the long term and equitable harmonious development), Qiye dangjian, No.4, 2006 "Zhongguo de heping jueqi zhi lu (shang)", (The path of China's peaceful rise -1), Gongchandang ren, No.1, 2007 142

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"Zhongguo de heping jueqi zhi lu" (Xia), (The path of China's peaceful rise -2), Gongchandang ren,Gongchandang ren, No.2, 2007 "Zhongguo heping jueqi yaolun", (Points of China's Peaceful rise) Huazhong shifan daxue, 2007 (China doctoral dissertations database)

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Dr. Marcin ZABOROWSKI

EU-China Security Relations* Until recently European security planners had little to say about and indeed not much interest in China. The People's Republic was primarily regarded as the cradle of an ancient and rich culture, a place where Europeans liked to travel and, latterly, make money, taking advantage of the country's economic dynamism. Considering China's place and its role in the global security system was more or less left to the Americans, with the Europeans following Washington's lead. This has changed to the point that most of the recent European policy papers and bilateral EU-China summits place security at the heart of the relationship. In the meantime, it has also become clear that the European and American security perspectives on China are not identical and indeed that they are increasingly divergent. Two developments are responsible for this change: the continuing development of the EU as a global security actor and the expansion of China's interests into the areas (Africa, Middle East) which overlap with the European security interests. This paper deals with the European perspective on the relationship's security aspects. It looks first at the most essential aspects of bilateral Sino-European relations and then at their transatlantic implications. EU-China: closer partners, growing responsibilities The EU and China agreed to form a strategic partnership in 2003. At this point in time the EU came to the conclusion that China's rise was an enduring process and major phenomenon, which would change the nature of the international system. Rather than object to the inevitable, the EU decided in favour of embracing the process, engaging China and influencing its strategic culture through dialogue and cooperation. Of course, the EU continued to have a number of concerns about China's international posture and especially about cross-strait relations and China's relations with Japan – traditionally a close partner of the EU. On the other hand, with US unilateralism in the background, China's international behaviour did not appear uncooperative or irresponsible. Whilst 146

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retaining its differences China was open to discussion and often agreed (or abstained from voting) with the western powers at the United Nations. Like most European countries, China opposed the war in Iraq, although, unlike France, it did not threaten to use its veto power at the Security Council. In 2004 in a landmark decision China agreed to send its peacekeepers to Haiti, hence overcoming its traditional opposition to intervening in other countries. Both the Europeans and the Chinese talked about a pluralistic international system and the fact that this meant different things to both parties was not yet apparent at the time. In 2003 the expansion of the Chinese presence in Africa and the Middle East was only beginning, as was the process of China's military modernisation, neither of which caused much concern in Europe at the time. As a result, security issues were either absent or certainly not at the forefront of European considerations when embarking on the strategic partnership with Beijing in 2003. The same was true for the initial European decision to lift its embargo on arms exports to China. The subsequent reversal of the EU decision on this issue was largely motivated by the fact that the strategic implications of the move began to filter into the calculations of European policymakers. Three years after the landmark 2003 agreement, the EU decided on a major revision of its China policy. This time, it is clear that security had become one of the top factors motivating EU's China policy, a trend which is likely to continue in the future. Security-related aspects of the EU's three most important documents (the Commission Communication of 24 November 2006, the Finnish Presidency's EU Council Conclusions of 11-12 December 2006 and the Joint Statement of the Ninth EU-China Summit of 9 September 2006) fall into four categories: Security governance, energy security, East Asia and China's defence policy. They are discussed below: 1) Global governance The overall tone of the EU's recent China policy papers unmistakably suggests that Brussels expects and calls for a greater 147

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contribution by Beijing towards the maintenance of international stability. A few years ago the EU's comments on China's global role were limited to commending Beijing's re-entry into the international system and its overall cooperative posture at the UN. This time, however, the expectations of the EU have grown, with Brussels saying that as one of the major world powers, whose global importance will only continue to increase, it is essential that China takes a greater share of responsibility. The EU also argues that China has clearly benefited from its integration into the international system and that global stability remains essential for China's economic development and its security interests. What concrete steps and policy posture is the EU calling for here? They fall into the following categories: Strengthening the role of the UN, other international organisations and regimes. Embracing a genuine commitment to international law and multilateralism. The Chinese tend to replace multilateralism with multipolarity and arguing in favour of a more pluralistic international system – both of which are greeted with unease by the Europeans.1 Multipolarity has clearly negative connotations for most Europeans who associate it with the balance of power politics of the 19th and early 20th century. In the European mind 'multilateralism' (which the Europeans promote) means the rule of international law whilst 'multipolarity' means the rule of a few big, powerful states and perennial instability. The prospect of a more pluralistic international system is also greeted with ambivalence in Europe and especially by those who do not question their reliance on the American security protection. Enhancing cooperation on non-proliferation. The EU cooperates with China on non-proliferation on the basis of the Joint Declaration issued at the 2004 EU-China summit. The EU expressed its appreciation of the role 1 For example, see 'China's EU Policy Paper', 13 October 2003.

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China played in reaching the six-party agreement in February 2007, which may pave the way towards the denuclearisation of the Korean peninsula. The EU also compliments China's role in resolving the nuclear issue in Iran, although it is well known that Beijing rejects the EU's call for more assertive action vis-à-vis Tehran. It is against the background of the Iranian and North Korean contexts that the EU urges China to promote global compliance with the non-proliferation regime. Brussels also calls for the strengthening of the WMD-related materials and technologies. This provision alludes to China's cooperation with Iran as well as some African states. 2) Energy security The EU has watched the expansion of China's energy demand with growing unease. As EU documents have noted over the last few years, China has become the world's second energy consumer and it is on its way to overtaking the US as the biggest consumer of world's energy resources. This is, of course, a natural consequence of China's economic development, which in itself is welcomed by the EU. However, the following aspects of China's energy policy cause some concern in the EU: ?China invests in some energy-rich 'states of concern', for example in Iran, Sudan, Burma/Myanmar, Turkmenistan and Uzbekistan, whilst ignoring the nature of political leadership there. Refraining from interfering in other states' internal affairs is a longstanding cornerstone of China's foreign policy, but in this case its posture directly undermines whatever leverage the EU could have in promoting reforms in these countries. China's overseas investors seeking to secure long-term and exclusive contracts. Almost all Chinese energy companies remain state-owned or state-controlled and their investment plans are heavily influenced by the government's calculations rather than expectations of profitability. In the view of the EU, these practices often run against the principles of the open market and free 149

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competition as well as contributing to the increase in energy prices. The environment. There is no doubt that China's economic development and its dynamically growing energy consumption are posing an environmental challenge and are among main factors contributing to global warming. According to some experts, whilst the US remains the world's primary polluter, in some areas (acid rain, particles and toxic metals) China has already 'caught up' with the US.2 The recent EU documents emphasise the need to enhance cooperation with Beijing over the reduction of emissions and promotion of clean energy. 3) East Asia The EU commends China for its role in promoting regional integration and for the improvement in relations with India as well as for being a taming influence on North Korea. The EU has expressed some concern about China's relations with Japan, noting recent tensions and arguing in favour of stronger diplomatic engagement. However, Brussels recognises that history divides these two neighbours and that Japan has not been as forthcoming with regard to settling these past differences as it might have been. Most importantly, however, Brussels is clearly concerned about the state of cross-strait relations, fearing a possible escalation of tensions, especially during the forthcoming election year in Taiwan. The EU always stresses its commitment to the One China policy but it strongly opposes forceful ways of achieving unification. China's threat of the use of force was in the view of the EU advanced by the mainland's passing of the anti-secessionist law, which was one of the main factors motivating the reversal of the EU decision to lift arms embargo on China. But the EU has also warned Taipei against pursuing any measures that could unilaterally change the existing status quo, such as a declaration of independence 2 Philip Andrew-Speed, 'China's energy policy and its contribution to international stability', in Marcin Zaborowski (ed.), 'Facing China's Rise: Guidelines for an EU Strategy', Chaillot Paper no. 94, December 2006, European Union Institute for Security Studies, Paris.

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4) China's defence policy The modernisation and the growth of China's People's Liberation Army (PLA) does not raise the same concern in the EU as it does in the US. The EU recognises that China's rise must inevitably be reflected in the military and defence spheres. However, whilst the growth of China's military spending does not alarm the Europeans, Brussels is increasingly concerned about the lack of transparency in this process. In particular, the EU is sceptical about the actual level of the PLA's budget (assessed by the Pentagon as two or three times higher than official figure) and its military objectives. Consequently, the EU has taken steps to develop its capacity to assess the PLA and China's defence policy. Transatlantic implications The China factor has begun to figure in transatlantic relations following the EU's debate on ending its arms embargo. At the moment the EU's decision on the embargo has been delayed and it does not seem likely that the matter will be resolved any time soon, although in its recent conclusions the EU Council has reasserted that it would work towards ending the restrictions.3 Still, the United States remains staunchly opposed to any policy change on the embargo and the EU is concerned about making a move that could undermine the post-Iraq transatlantic rapprochement. However, the importance of transatlantic considerations in this decision seems exaggerated if not misjudged. After all, America's other close allies Israel and Australia are selling arms to China, which so far has not led to any major friction in Washington's relations with these states.4 Whilst the arms embargo has been the focus of the transatlantic debate on China, there is no doubt that the significance of this issue has been blown out of proportion. In reality, on the majority of issues concerning East Asia the positions of the EU and the US are 3 See point 13 of the Council Conclusions, Brussels, 11-12 December 2006. 4 According to Dan Blumenthal (China expert in the conservative American Enterprise Institute), after Russia Israel is the second biggest exporter of weapons to China; see: Blumenthal, 'Providing Arms. China and the Middle East'. See also: Israel Authorises Resumption of Military Exports to China, Atlantic News, 7 March 2006.

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very close. For example, like the US the EU has an interest in the peaceful resolution of the Taiwanese issue and in preventing instability in East Asia. Equally, like the US the EU is concerned about the link between China's energy investment and its lenient attitude towards Iran, Sudan and other states of concern. However, whilst similar, the interests of the EU and the US vis-à-vis China are not always identical. Most importantly, unlike the US the EU is not militarily present in East Asia and it does not represent an element of the balance of power in the region. As argued above, China's military modernisation bothers the US to a much greater extent than it does the EU, which tends to see it as a natural consequence of the PRC's growing international status. The US debate remains focused on the rapid growth in China's defence spending, but the Europeans point out that even if China spends twice as much as it declares ($ 35 billion) this is still a small fraction of the Pentagon's nearly $500 budget. It is clear that Europeans do not always share America's security assessment in the region, in particular they are not willing to participate in the China 'hedging' strategy. As the EU further develops its foreign policy role and its political presence in East Asia grows, it is perhaps inevitable that, although minor at the moment, some transatlantic differences of perspectives in East Asia will become more apparent and perhaps more consequential in terms of policy. It is however far more important that both Europe and the US share the view that a stable, prosperous and internationally responsible China is in their common interest.

*This article was previously published by the EU Institute For Security Studies in February, 2008. 152

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China's EU Policy Paper* The international situation has been undergoing profound changes since the advent of the new century. The trend towards world multipolarity and economic globalisation is developing amid twists and turns. Peace and development remain the themes of our era. The world is hardly a tranquil place and mankind is still confronted with many serious challenges. However, preserving world peace, promoting development and strengthening cooperation, which is vital to the well-being of all nations, represents the common aspiration of all peoples and is an irreversible trend of history. China is committed to turning herself into a well-off society in an all-round way and aspires for a favourable international climate. China will continue to pursue its independent foreign policy of peace and work closely with other countries for the establishment of a new international political and economic order that is fair and equitable, and based on the Five Principles of Peaceful Co-existence. China will, as always, respect diversity in the world and promote democracy in international relations in the interest of world peace and common development. The European Union (EU) is a major force in the world. The Chinese Government appreciates the importance the EU and its members attach to developing relations with China. The present EU Policy Paper of the Chinese Government is the first of its kind and aims to highlight the objectives of China's EU policy, and outline the areas and plans of cooperation and related measures in the next five years so as to enhance China-EU all-round cooperation and promote a long-term and stable development of China-EU relations. Part One: Status and Role of the European Union The creation and development of the European Union is an event of far-reaching significance following World War II. Since the launch of the European Coal and Steel Community in 1952, the EU has become what it is today through the stages of the Tax and 154

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Customs Union, the Single Market and the Economic and Monetary Union. Its integration in the foreign policy, defence and social fields has made headway. The Euro has been put to circulation successfully and a single area of justice is taking shape. The EU is now a strong and the most integrated community in the world, taking up 25 and 35 percent of the world's economy and trade respectively and ranking high on the world's list of per capita income and foreign investment. In 2004, the EU will be enlarged to a total membership of 25. The new European Union would then cover much of Eastern and Western Europe with an area of four million square kilometers, a population of 450 million and a GDP of over 10 trillion US Dollars. Despite its difficulties and challenges ahead, the European integration process is irreversible and the EU will play an increasingly important role in both regional and international affairs. Part Two: China's EU Policy China attaches importance to the role and influence of the EU in regional and international affairs. History proves that the establishment of diplomatic relations between China and the European Economic Community in 1975 has served the interests of both sides. Despite their twists and turns, China-EU relations as a whole have been growing stronger and more mature and are now on the track of a comprehensive and sound development. In 1998 China and the EU launched their annual summit mechanism. In 2001, the two sides established a full partnership. China and the EU have developed an ever closer consultation and fruitful cooperation in the political, economic, trade, scientific, cultural and educational fields. China-EU relations now are better than any time in history. There is no fundamental conflict of interest between China and the EU and neither side poses a threat to the other. However, given their differences in historical background, cultural heritage, political system and economic development level, it is natural that the two sides have different views or even disagree on some issues. Nevertheless China-EU relations of mutual trust and mutual benefit cannot and will not be affected if the two sides address their disagreements in a spirit of equality and mutual respect. 155

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The common ground between China and the EU far outweighs their disagreements. Both China and the EU stand for democracy in international relations and an enhanced role of the UN. Both are committed to combating international terrorism and promoting sustainable development through poverty elimination and environmental protection endeavours. China and the EU are highly complementary economically thanks to their respective advantages. The EU has a developed economy, advanced technologies and strong financial resources while China boasts steady economic growth, a huge market and abundant labour force. There is a broad prospect for bilateral trade and economic and technological cooperation. Both China and the EU member states have a long history and splendid culture each and stand for more cultural exchanges and mutual emulation. The political, economic and cultural common understanding and interaction between China and the EU offer a solid foundation for the continued growth of China-EU relations. -To strengthen and enhance China-EU relations is an important component of China's foreign policy. China is committed to a long-term, stable and full partnership with the EU. China's EU policy objectives are: -To promote a sound and steady development of China-EU political relations under the principles of mutual respect, mutual trust and seeking common ground while reserving differences, and contribute to world peace and stability; -To deepen China-EU economic cooperation and trade under the principles of mutual benefit, reciprocity and consultation on an equal basis, and promote common development; -To expand China-EU cultural and people-to-people exchanges under the principle of mutual emulation, common prosperity and complementarity, and promote cultural harmony and progress between the East and the West. 156

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Part Three: Strengthen China-EU Cooperation in All Fields 1. The Political Aspect 2. Strengthen the exchange of high-level visits and political dialogue -Maintain close contacts and timely communication between the two sides at high levels through various means. -Taiwan's entry into the WTO in the name of "separate customs territory of Taiwan, 'Penghu, Jinmen, Mazu" (or Chinese Taipei for short) does not mean any change in Taiwan's status as part of China. EU exchanges with Taiwan must be strictly unofficial and non-governmental. -Not to sell to Taiwan any weapon, equipment, goods, materials or technology that can be used for military purposes. 3. Encourage Hong Kong and Macao's cooperation with EU The Central Government of China supports and encourages the Hong Kong and Macao Special Administrative Regions in developing friendly relations and cooperation with the EU in accordance with the principle of "one country, two systems" and the provisions of the two Basic Laws and on the basis of equality and mutual benefit. 4. Promote the EU's understanding of Tibet China encourages personages of various circles in the EU to visit Tibet and welcomes the support of the EU and its members to Tibet's economic, cultural, educational and social development and their cooperation with the autonomous region subject to full respect of China's laws and regulations. The Chinese side requests the EU side not to have any contact with the "Tibetan government in exile" or provide facilities to the separatist activities of the Dalai clique. 5. Continue the human rights dialogue There are both consensus and disagreements between China and the EU on the question of human rights. The Chinese side appreciates the EU's persistent position for dialogue and against confrontation and stands ready to continue dialogue, exchange and cooperation on human rights with the EU on the basis of equality 157

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and mutual respect so as to share information, enhance mutual understanding and deepen cooperation in protecting, inter alia, citizens' social and cultural rights and the rights of the disadvantaged. 6. Strengthen international cooperation - Enhance China-EU consultation and coordination on major international and regional hotspot issues. -Strengthen China-EU cooperation at the UN and work together to uphold the UN's authority, promote its leading role in safeguarding world peace and facilitating economic and social development, particularly in helping developing countries eliminate poverty, improving global environment and drug control, and support UN's reform. -Advance the process of Asia-Europe cooperation. China and the EU should work together to make ASEM a role model for intercontinental cooperation on the basis of equality, a channel for exchange between the oriental and occidental civilizations and a driving force behind the establishment of a new international political and economic order. -Jointly combat terrorism. Both China and the EU are victims of terrorism and are strongly opposed to all forms of terrorism. Both sides are also opposed to any linkage between terrorism and any particular country, nation, ethnic group or religion. China and the EU should keep in close touch and cooperation on counterterrorism. -Jointly safeguard the international arms control, disarmament and non-proliferation regimes and step up consultation and coordination on the basis of mutual respect; strengthen exchange and cooperation on non-proliferation and export control and the prevention of weaponization of and arms race in outer space; jointly contribute to the resolution of the issue of anti-personnel landmines and explosive remnants of war; and enhance cooperation in implementing the international arms control treaties. 158

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7. Enhance mutual understanding between Chinese and European legislative organs The relations between the National People's Congress of China and the parliaments of EU member countries and theEuropean Parliament are an important link in China-EU ties. The Chinese Government welcomes and supports the enhancement of exchange and dialogue between Chinese and European legislatures on the basis of mutual respect, deeper understanding, seeking common ground while shelving differences and developing cooperation. 8. Increase exchanges between political parties in China and the EU The Chinese Government wishes to see an increase of exchange and cooperation between the Communist Party of China and all major EU political parties, parliamentary party groups and regional organizations of political parties on the basis of independence, complete equality, mutual respect and noninterference in each other's internal affairs. The Chinese Government wishes to see an increase of exchange and cooperation between the Communist Party of China and all major EU political parties, parliamentary party groups and regional organizations of political parties on the basis of independence, complete equality, mutual respect and noninterference in each other's internal affairs. I. The Economic Aspect 1. Economic Cooperation and Trade China is committed to developing dynamic, long-term and stable economic cooperation and trade with the EU and expects the latter to become China's largest trading and investment partner. To this end, it is important to: - Give play to the mechanism of the economic and trade joint committee and step up economic and trade regulatory policy dialogue; give attention to updating the Trade and Economic Cooperation Agreement Between China and the European Union at an appropriate time; properly address irrational restrictions and technical barriers, ease restrictions on high-tech exports and tap the enormous potential of technological cooperation and trade in line with the WTO rules; grant China a full market economy status at an early date, reduce and abolish anti-dumping and other 159

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discriminatory policies and practices against China, and apply the Transitional Product-Specific Safeguard Mechanism (TPSSM) prudently; and compensate the Chinese side for its economic and trade losses which may arise due to the EU enlargement. -Boost China-EU coordination and cooperation in the new round of WTO negotiations and work together for the success of the negotiations. -Strengthen dialogue on investment, promote the establishment of bilateral investment-promotion institutions, energetically encourage and guide mutual investments between enterprises of the two sides, and expand cooperation between their small- and medium-sized enterprises; develop processing trade, contractual projects and labour cooperation of various kinds and encourage transnational business operation and internationalised production. -China welcomes more EU development aid, especially in such fields as the environmental protection, poverty-alleviation, public health and hygiene and education. China also welcomes a stronger and more active role of the EU in human resources development, in particular, personnel training for China's central and western regions and build-up of China's capacity of participating in multilateral trading regime. -Step up cooperation in the area of quality supervision, inspection and quarantine, establish appropriate consultation mechanisms and, subject to the principle of ensuring Boost the customs cooperation and conclude a China-EU Customs Agreement in due course. 2. Financial Cooperation China and the EU should launch a high-level financial dialogue mechanism, expand exchanges between their central banks on policies and deepen cooperation in preventing and managing financial crises and combating the financing of terrorism and money laundering. The Chinese side welcomes an expansion of China-related business by banks of the EU countries and hopes to see an appropriate settlement of the issue of Chinese financial institutions' access to the EU market. 160

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The Chinese side will positively examine and consider applications of EU insurance institutions for business operation in China and improve its supervisory and regulatory regime in line with the Chinese insurance laws, regulations and statutes and China's WTO commitments. Cooperation in securities legislation, market supervision and regulation, and investment operation will be strengthened andmore EU securities institutions, fund management institutions and other institutional investors will be encouraged to enter into China's market. Chinese securities institutions will be encouraged to enter into the EU's securities market when conditions are ripe. In the meantime, Chinese enterprises will be strongly supported to raise funds in the EU's securities market. 3. Agricultural Cooperation Exchanges between China and the EU in such fields as agricultural production, processing technology of agricultural produce and sustainable development will be intensified. The mechanism of the agricultural working group should be given a role to play. Bilateral cooperation between agricultural research institutes, universities and colleges as well as enterprises should be pushed forward. EU Enterprises are encouraged to take an active part in agricultural development in China's central and western regions and invest in such fields as agricultural high and new technologies, intensive processing of agricultural produce and development of agricultural infrastructure. 4. Environmental Cooperation China-EU communication and cooperation in environmental protection should be stimulated and a mechanism of dialogue between the Chinese and EU environmental ministers launched. Framework documents on environmental cooperation should be formulated, and discussions held on the establishment of information network on environmental cooperation. Bilateral cooperation should be strengthened on such issues as environmental legislation and management, climate change, biodiversity protection, bio-safety management, and trade and environment. Efforts should be made to jointly promote the implementation of the follow-up actions of the World Summit on Sustainable Development in Johannesburg. Non-governmental 161

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environmental protection organizations are encouraged to develop mutual exchanges. EU enterprises are encouraged to gain more access to Chinese environmental protection market through fair competition. 5.IT Cooperation The Chinese side would like to see the EU participation in China's IT promotion. The mechanism of the EU-China workinggroup on information society will be strengthened. Exchanges and dialogue will be conducted on strategies, policies, rules and regulations of information society. Trade in IT products and industrial and technological cooperation will be actively boosted. Greater exchanges in intellectual property rights and technical standards will be encouraged. Cooperation in the field of "Digital Olympics" will be promoted. 6.Energy Cooperation China-EU cooperation will be expanded in such fields as energy structure, clean energy, renewable energy, and energy efficiency and saving. Exchanges on energy development policies will be promoted. Efforts will be made to ensure a successful EUChina Energy Conference. The energy working group mechanism will be strengthened. Training on energy technology and cooperation in demonstration projects will be boosted to promote application and transfer of technology. 7.Transport Cooperation A mechanism of China-EU regular meeting will be set up within the framework of the China-EU Agreement on Maritime Transport. Cooperation in maritime transport and other maritime fields will be developed and coordination and cooperation in international organizations such as the International Maritime Organization (IMO) will be strengthened. Bilateral exchanges will be deepened and broadened in respect of policies of inland river transport, navigation safety and shipping standardization. Cooperation and exchanges in highway technology and management will be expanded. Dialogue and exchanges on highway transport legislation will be strengthened. 162

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China-EU exchanges in civil aviation will be deepened. Chinese and EU enterprises are encouraged to strengthen their cooperation on production, technology, management and training. II.The Education, Science-Technology, Culture, Health and other Aspects 1.Cooperation in Science and Technology It is essential to promote China-EU scientific and technological cooperation on the basis of the principles of mutual benefit and reciprocity, sharing of results and protection of intellectual property rights. Joint development and cooperation on generic technologies and major technical equipment should be stepped up and Chinese institutions are encouraged to participate in the EU Framework Program for Research and Technological Development. China will, on the premise of equality and mutual benefit and a balance between interests and obligations, participate in the Galileo Program and enhance cooperation in international "big science" projects. Full play should be given to the role of the Scientific and Technologic Cooperation Steering Committee and efforts should be made to ensure a successful China-Europe Science & Technology and Innovation Policy Forum. Cooperation between scientific and technological intermediary agencies of the two sides as well as the interflow and training of scientific and technological human resources should be encouraged. Support should be given to Chinese and EU enterprises in their involvement in scientific and technological cooperation. 2.Cultural Exchange China will be more open in cementing and deepening its exchange and cooperation with EU members in the cultural field and work towards a multi-level and all-dimensional framework of cultural exchanges between China and the European Union, EU members and their respective local governments, and between their peoples and business communities so as to make it easier for the people of China and the EU to get to know each other's fine cultures. China will establish Chinese cultural centers in capitals of EU members and the EU headquarters -- Brussels. On the basis of 163

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reciprocity and mutual benefit, China welcomes the set-up of cultural centers in Beijing by the EU side. China will encourage high quality cultural exchange activities and explore new modalities of cooperation in culture-related industries. Discussions will be held on the formation of a China-EU cultural cooperation consultation mechanism and the idea of jointly holding a ChinaEU cultural forum. 3.Cooperation in Education Exchanges at all levels will be enhanced and expanded. It is necessary to establish a China-EU education cooperation consultation mechanism as appropriate and strengthen cooperation in areas including mutual recognition of academic credentials and degrees, exchange of students, language teaching, exchange of scholarships and teacher training. Work should be done to make a success of the China-Europe International Business School and bring forth more top professionals. The teaching of each other's languages should be encouraged and supported. 4.Cooperation in Health and Medical Care Cooperation in the health sector should be strengthened, particularly in sharing experience of prevention and control of SARS, HIV/AIDS and other serious diseases. Efforts should be made to develop exchanges in clinical diagnosis and treatment, epidemiological investigation, analysis and surveillance, laboratory testing, R&D for medicines and vaccines, and training of medical personnel. Exploratory endeavor should be made for the establishment of a mechanism to keep each other informed and provide technical support in case of emergent public health hazards. 　　

5.Press Exchange　　

Exchanges and cooperation will be boosted between the press and media communities of the two sides. Chinese and EU media agencies should be encouraged to enhance mutual understanding and give comprehensive and unbiased reports of each other. Relevant government departments or agencies of the two sides should enhance mutual contact and communication and share practices and experience in respect of government press release and the handling of government-media relations.　　 164

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6.Personnel Exchange　

People-to-people exchanges and those between nongovernmental organizations of China and the EU should be encouraged. China is ready to conclude as early as possible agreement on designating EU countries as tourism destinations for outbound Chinese citizens' incompliance with the principles of equality, reciprocity and mutual benefit. China-EU consular cooperation should be strengthened and expanded. An early solution should be found through consultations to the problem of difficult access to entry visas by Chinese citizens and their impeded entry into EU countries. The legitimate rights and interests of travelers should be protected. Normal people-topeople exchanges between China and the EU should be ensured. It is imperative to combat illegal migration and human trafficking, strictly enforce laws and crack down on illegal activities and crimes. The two sides should increase consultations and coordination and appropriately handle the question of repatriation and other issues arising therefrom. III. The Social, Judicial and Administrative Aspects 1.Cooperation in Labor and Social Security China and the EU should strengthen cooperation on employment of legal immigrants and protection of the rights and interests of migrant workers and enhance coordination in international labor affairs. The two sides will negotiate and conclude a bilateral social security agreement and implement their joint social security cooperation program as well as broaden exchanges in social insurance of various kinds. 2.Exchange in Judicial Field It is necessary to continue with the China-EU cooperation program in the legal and judicial fields based on equality and mutual respect, broaden related areas of cooperation, enhance exchanges in judicial reform and other key areas and explore cooperation with respect to administration of justice in combating cross border crimes. The two sides should do more in sharing experience of legal supervision and explore the possibility of establishing a mechanism of annual meeting between their high-level judicial officials. 165

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3.Cooperation in Police Affairs The Chinese side will establish and strengthen exchanges with relevant EU agencies and EUROPOL, broaden substantial cooperation with law-enforcement organs of EU members and step up coordination in case handling and information sharing within their respective legal framework. The two sides should support and actively participate in UN peacekeeping and other activities. 4.Cooperation in Public Administration China and the EU should share experience in transforming government functions and deepening personnel management reform, discuss the establishment of a China-EU cooperation mechanism on personnel and administrative management and conduct exchanges in civil service system building and human resources development. IV. The Military Aspect China and the EU will maintain high-level military-tomilitary exchanges, develop and improve, step by step, a strategic security consultation mechanism, exchange more missions of military experts, and expand exchanges in respect of military officers' training and defense studies. The EU should lift its ban on arms sales to China at an early date so as to remove barriers to greater bilateral cooperation on defense industry and technologies

* This article was taken from the official sources of the Ministry of Foreign Affairs of the People's Republic of China

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The Changing Role of Nationalism within China's Domestic and Foreign Policies

Ghulam ALI

The Changing Role of Nationalism within China's Domestic and Foreign Policies Introduction China's defeat in the Opium Wars, 1839-1842 and 1856-1860, at the hands of the British colonial power, became a turning point in the modern Chinese history. It was the first time that China's territorial sovereignty was compromised by its rulers who signed what is known as “unequal” the Treaty of Nanking (Treaty of Nanjing). In the subsequent decades, the declining Qing Dynasty, after every defeat at the hands of colonial powers, further surrendered China's territory and sovereignty. These developments generated unprecedented level of nationalistic sentiments among the Chinese people against the centuries-old dynastic rule which they held responsible for China's backwardness as well as the humiliating defeats it suffered against the foreign invaders. Since then, the feelings of nationalism have thrived unabated in China and have been aptly capitalised by successive Chinese leaders for domestic and external policies. The nature of nationalism changed under different circumstances, the ultimate objective, however, remained the same: “to seek and preserve China's national independence.”1 Survey of the mainstream literature on Chinese nationalism can be stated as the struggle of the Communist Party of China (CPC) to unify the motherland to ward off the impact of the “century of humiliation”, to protect its national sovereignty, territorial integrity, to accelerate the economic development of the country, to raise the living standard of its people, to build a strong nation and play an increasingly active role in the world politics to influence its course of actions on the lines more suited to China's interests. This would legitimise the Communist Party of China's (CPC) rule in the country.2 1 Tianbiao Zhu, “Nationalism and Chinese Foreign Policy”, The China Review, vol. 1, no. 1 (Fall 2004) p. 2. 2 For Example Sea William A. Callahan, “National Insceurities: Humiliation, Salvation, and Chinese Nationalism Alternative vol. 29 (2004): Michel Oksenberg. “China: Confident Nationalism” Foreign Affairs, vol. 65, no. 3, 1986. Scoisheng Zhao, “China's Pragmatic Nationalism: Is It manageable”, The Washington Quarterly, Winter 2005-6.

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This paper is an attempt to study the changing role of nationalism in foreign and domestic policies of China. It begins with defining the term nationalism and then takes a look at Chinese nationalism. The paper traces the root of Chinese nationalism and examines how Chinese leaders have successfully capitalised on nationalism in addressing the internal and external challenges facing China. Defining Nationalism Nationalism is a political creed which is associated with the modern nation-state system.3 The word 'nation' is generally referred to a collection of people who feel that they belong together and constitute a community, ideally, in the form of a nation-state. Thus, nationalism can be defined as the “sentiments of love, identification, loyalty, and commitment for the people who constitute one's national group.”4 According to Peter Marris, nationalism is “the process whereby a group or community that shares – or at least is convinced that it shares – a common history, culture, language and territory is persuaded to assert its own affairs, usually through the creation of an independent state.”5 It becomes clear from these definitions that relationship between a nation and a state is one of symbiosis. In this way, a group of people constituting a nation can best secure its interests, if it has its own state, territory and government. The state would protect them from the external aggressors on the one hand and provide them equal opportunities to succeed in life.6 The Wikipedia has defined 'Chinese nationalism' as cultural, historiographical, and political theories, movements, and beliefs that assert the idea of a cohesive, unified Chinese people and culture under a unified country known as China.7 Emergence of Nationalism in China Most scholars agree that the origin and the development of Chinese nationalism is largely associated with the formation and 3 David L. Sills (ed.), International Encyclopedia of the SOCIAL SCIENCES, vol. 11 (New York: The Macmillan, 1999), p. 63. 4 Maria Hsia Chang, “Chinese Irredentist nationalism: The Magician's Last Trick,” Comparative Strategy, vol. 17, no. 83 (1998), pp. 834. 5 Pewter Marris, “Chinese Nationalism: The state of the Nation,” The China Journal, no. 38 (1997), p. 124 in Zhu, “National and China Foreign Policy. 6 Ibid. 7 Wikipedia (Online), http://en.wikipedia.org/wiki/Chinese_nationalism.

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development of the modern Chinese state.8 According to Suisheng Zhao, before the nineteenth century, when China was still an empire, nationalism did not exist. The Chinese political elite began to embrace modern nationalist doctrine for China's defence and regeneration only after China's disastrous defeat by British troops in the 1839-42 Opium War, which led not only to the eventual disintegration of the Chinese empire but also to the loss of national sovereignty to imperialist powers. Since that time, the nationalist quest to blot out the humiliation China suffered at the hands of imperialists has been a recurring theme in Chinese politics. Almost all powerful Chinese leaders, from the early twentieth century through today, have shared a deep bitterness at this humiliation and have been determined to restore China's pride and prestige, as well as its rightful place in the world.9 They realised the potential of nationalistic feelings among the Chinese people and deliberately revived it in the memory of the people. As William A. Callahan noted, “There are textbooks, novels, museums, songs, and parks devoted to commemorating national humiliation in China.”10 In one of its earliest forms during the early twentieth century, Chinese nationalism began not pragmatically, but rather as an ethnic state-seeking movement led by the Han majority to overthrow the Qing Dynasty, under which China was ruled by the Manchu minority. This kind of ethnic-based nationalism viewed the nation as a politicised ethnic group and often produced a stateseeking movement to create an ethnic nation-state. This ethnicbased nationalism disappeared after the abolition of Qing dynasty, and the creation of Republic of China in 1911. The subsequent Chinese ruler, Kuomintang (KMT) and the CPC defined China as a multiethnic political community.11 8 Tianbiao Zhu, “Nationalism and Chinese Foreign Policy,” The China Review, vol. 1, no. 1 (Fall 2001), p. 3. 9 Suisheng Zhao, “China's Pragmatic Nationalism: Is it Manageable?” The Washington Quarterly (Winter 2005-06), pp. 132-3. 10 William A Callahan, “National Insecurities: Humiliation, Salvation, and Chinese Nationalism,” Alternatives, vol. 29 (2004), p. 199. 11 Zhao, “China's Pragmatic Nationalism: Is it Manageable?”, p. 133.

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From the establishment of the People's Republic of China in 1949 until his death in 1976, Nationalism remained the dominant factor in Mao's mind while designing domestic and foreign policies of China, since “Mao was a Chinese nationalist first and foremost.”12 Tianbiao Zhu, Chinese scholar, stated that one of the reasons of Mao's differences with the Soviet leaders was the fact that he never wanted CPC to become puppet of the Communist Party of Soviet Union - this was due to his strong sense of Chinese nationalism. “Mao's concept of revolution reflected his generation's emotional commitment to China's national liberation as well as of its longing for China to take a central position in world politics.”13 It is a less known fact that China's “leaning to one side” principle was not a natural outcome of ideological similarity between China and Soviet Union. This was a strategic decision, which was not based on shared ideology, but on the consideration of how to make China economically and politically strong.14 Even China's decision to enter the Korean War in 1950 was not an ideological commitment, but determined by a national security consideration induced by the rapid advancement of American and South Korean troops into North Korea.15 Similarly, China's distancing from the Soviet Union - a trend, which began in the late 1950s and fostered in the early 1960s - was motivated, among other factors, by Mao's concern at the increasing Soviet influence on China's economic model and “unreasonable Soviet demands.”16 The demands included: stationing of Soviet Forces in Dairen and Port Arthur in Manchuria; the establishment of a joint pacific fleet under the Soviet command: and of a powerful longwave radio station for naval communication in China under Soviet Control. Mao had concluded that the Soviet involvement in China's economic programme was inconsistent with the goal of China's nationalism. 12 Zhu, “Nationalism and Chinese Foreign Policy”. 13 Zhu, “Nationalism and Chinese Foreign Policy,” p. 6. 14 Ibid., p. 7. 15 Sergei N. Goncharov, John W Levis, and Litai Xue, Uncertain Partners: Stalin, Mao, and the Korean War (Stanford: Stanford University Press, 1993), p. 124 in Zhu, “Nationalism and Chinese Foreign Policy,” p. 7. 16 Chun-tu Hsuch (ed.), “Introduction” in China's Foreign Relations, New Perspective, (New York: Praeger, 1982), pp. 2-3 cited in Zhu, “Nationalism and Chinese Foreign Policy,” p. 8.

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Thus, despite the fact that China needed the continued supply of Soviet economic and technical assistance to boost its national development, China preferred the path of self-sufficiency and reverted to isolationism. The split in Sino-Soviet relations led China to introduce great transformation in its domestic and foreign policy. Subsequently, Mao started emphasising upon “selfreliance” and anti-Soviet policies. His decision for initiating Great Leap Forward (1958-60)18 and Cultural Revolution (1966-76) were also motivated by this thought.18 After already having troubled relations with the US and having a newly emerged hostility with the USSR, developing relations with the Third World countries became a key feature in Chinese foreign policy in the early 1960s. This shift could hardly improve China's economic sector, but Chinese leaders believed that establishing relations with the Third World countries would serve the goal of promoting and preserving national indepen-dence, improve its image in the international community and its efforts to break its internal isolation. To foster ties with the developing countries, Chinese Premier, Zhou Enlai, embarked on a state visit of the several newly independent African countries in 1963. China also accelerated its economic assistance to the Third World countries despite the fact that its own economy was quite poor during that period. According to some statistics, by 1980, under this policy, China had given aid to more than 70 countries on five continents, which totalled US$9 billion.19 This aid programme was much beyond China's capacity.20 However, China received the reciprocal support from the Third World countries. As a result of 17 The Great Leap Forward was an economic and social plan used from 1958 to 1960, which aimed to use China's vast population to rapidly transform mainland China from a primarily agrarian economy dominated by peasant farmers into a modern, industrialised communist society. Mao Zedong based this programme on the Theory of Productive Forces. http://en.wikipedia.org/ wiki/Great_Leap_ Forward 18 Zhu, “Nationalism and Chinese Foreign Policy,” p. 9. 19 Organisation for Economic Cooperation and Development (OECD), The Aid Progam of China (Paris: OECD, 1978), p. 8. cited in Zhu, “Nationalism and Chinese Foreing Policy,” pp. 10-11. 20 Tianbiao Zhu, “Nationalism and Chinese Foreign Policy,” The China Review, vol. 1, no. 1 (Fall 2001), pp. 10-11.

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the powerful campaign by the Third World, China got UN seat in the Security Council in September 1971, which was a great political and diplomatic success for China.21 China continued the practice of self-sufficiency and isolation policy for about 20 years, with a view to gain economic independence, an important step required to make China a great power, which was the ultimate goal of its nationalistic strategy. However, the country could not get meaningful outcome. The post-Mao leadership, under Deng Xiaoping, abandoned this policy and adopted an entirely new path for China. Under the new leadership in the late 1970s, China introduced drastic reforms both internally and externally.22 These reforms, among other things, called for loyalty to the nation rather than class struggle and socialist egalitarianism that meant loyalty to the CPC. One of the reasons of emphasis on nationalist elements of CPC ideology was the need to suppress popular call for political reforms that had accompanied the departure from socialist egalitarianism. Deng crushed calls for democracy during the “Beijing spring” in 1979 which was a clear message that reforms never equated democracy.23 Despite all cautious measures, the reforms and opening up gave rise to liberalism in China. Those who had suffered at the hands of communists under Mao got an opportunity to play a greater role in contemporary China. This school of thought which was named as “liberal nationalists” supported China in its battle against foreign imperialism. However, it did not necessarily support the Communist Party. Instead, it pressed for greater public participation in the political process and challenged the authoritarian rule of the CPC.24 The CPC was cognizant of the fact that the risk of agitation and mass movements may erupt in the wake of reforms. To avert such trends, it focused on the economic development and raised slogans like “get rich is glorious” (zifu 21 On October 26, 1971, the General Assembly passed a resolution that admitted the PRC to the UN and also granted it the status of permanent member of the Security Council. The campaign was launched by a vast majority of the Third World countries, see Keesing's Contemporary Archives: 1971-1972, p. 24941. 22 Zhu, “Nationalism and Chinese Foreign Policy,” p. 15. 23 Christopher R. Hughes, “Chinese nationalism in the global era,” 24 Zhao, “China's Pragmatic Nationalism: Is it Manageable?”, p. 133.

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guangrong). Under this policy, people were urged to consume, seize business opportunities, become entrepreneurs, and to compete openly with one another.25 The liberal nationalism burst into massive anti-government demonstrations in Tiananmen Squire in June 1989, which were quelled by the regime with an iron hand. Pragmatic Nationalism The events of Tiananmen Square and later the collapse of the communist system in the Soviet Union, posed new challenges to the CPC to restore its legitimacy and build broad-based national support. To address these emerging challenges, Chinese leadership gave a new twist to nationalism which emerged as 'pragmatic nationalism.' The concept of pragmatic nationalism identified China closely with CPC, rendering the two indistinguishable. The Chinese leadership pressed people for loyalty and love with state making it state-centric. The successive Chinese leaders, Deng Xiaoping, Jiang Zemin and Hu Jintao followed this line.(26)Responding to the events of June 1989, China stated that “this storm was bound to come sooner or later. This was determined by the major international climate and China's own minor climate.”27 The CPC stated that external factor had played much greater role in creating turmoil in China than the internal one. This gave rise to the “leftists” within Communist Party who slashed reforms and open door policies as well as China's dependence on the world economy. It also evoked the themes of China's humiliation and reaffirmed self-reliance. Allen S. Whitting, a Chinese Scholar, stated, “For a country to shake off foreign enslavement and become independent and self-reliant is the premise for its development…. Although China was a big country before the liberation, it was slavishly dependent on others and could only be bullied by them.”28 In the wake of the June 1989 events, Chinese leadership took a series of assertive measures to strengthen 'pragmatic nationalism'. China launched a “patriotic education campaign” deploying 25 Ibid., p. 134. 26 Ibid. pp. 134-5. 27 Allen S. Whiting, “Chinese Nationalism and Foreign Policy After Deng,” The China Quarterly, 1995, p. 297. 28 Ibid.

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emotive memories of the “hundred years of humiliation” that began with the Opium War. Special emphasis was given to recall the war against Japan and the civil war with the Nationalists (KMT). It also reminded the people that the CPC was the party of national salvation.29 Newspapers run by the People's Liberation Army (PLA) in particular started emphasising upon the revival of nationalism. Attributing China's past defeats to the “lack of vigilance” as well as inferior weapons, Allen Whitting, whose story was published in one such news-paper, stated that “once people lose their sense of country, of national defence, and of nation, total collapse of the spirit will inevitably follow.” He further stated that national identity suffered as the spiritual infiltration of hostile forces produced a slavish conquered people. Therefore, Chinese people should foster the most precious national spirit of the Chinese nation, resurrect the spirit of patriotism, and revive the will to build the nation.30 The ultimate collapse of communism in the Soviet Union in 1990 also brought a new challenge to the CPC posing a threat to its legitimacy. Many in China, as well as in the world, believed that communism was no longer sufficiently strong to serve as the sole ideological basis for the Chinese Communist rule, or even for holding China together.31 The Chinese leadership required a policy to address this situation. It wanted to send the world a message that the case of China was different from the Soviet Union. At home, it wanted to keep a hold on state affairs and wanted to inject new patriotic sentiments among the Chinese people. Deng Xiaoping responded to this situation and stated that disintegration of the Soviet Union was due to Mikhail Gorbachev's “betrayal” and emphasised upon Chinese people to adopt patriotic approach to cope with the new situation. He stated, “Under the present international situation all enemy attention will be concentrated on China. They will use every pretext to cause trouble, create 29 Hughes, “Chinese nationalism in the global era,” www.opendemocracy.net/ democracychina/nationalism_3456.jsp 30 Whiting, “Chinese Nationalism and Foreign Policy After Deng,” p. 298. 31 Zhu, “Nationalism and Chinese Foreign Policy,” p. 2.

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difficulties and pressures for us … The next three to five years will be extremely difficult for our Party and our country.”32 The CPC's policy in the wake of Tiananmen Square and the Soviet collapse succeeded in igniting assertive nationalism among the Chinese people for the support of party. Zhao commented that even though corruption and social as well as economic problems have undermined the CPC's legitimacy to an extent, many people side with the government when foreigners criticise it, believing that, no matter how corrupt the government is, foreigners have no right to make unwarranted remarks about China and its people. Many Chinese people were upset by US pressure on issues such as human rights, intellectual property rights, trade deficits, weapons proliferation, and Taiwan because they believed that the US had used these issues to demonise China in an effort to prevent it from achieving great-power status.33 Present Form of Chinese Nationalism Presently, Chinese nationalism is divided into two broad forms: state-centred nationalism and popular nationalism. The state-centred nationalism is closely related with CPC. The Western discourse believes that the ruling elite uses it to strengthen its rule in the country. This form of nationalism is centred on the Party as the embodiment and object of patriotic sentiment. This aims at making China strong, enabling it to regain its rightful place in the world. In this official discourse, China's historical patriotic struggle to make the country strong again is inextricably linked to socialism and the Chinese Communist Party. The Party readily associates itself with most patriots who struggled to free China but their efforts are seen as ineffectual without the guidance of the Party. The official discourse on patriotism also of course places the Party at the centre of economic development.34 The popular nationalism, on the other hand, either goes beyond the relatively restrictive boundaries of the official discourse . 32 Whiting, “Chinese Nationalism and Foreign Policy After Deng,” p. 298. 33 Zhao, “China's Pragmatic Nationalism: Is it Manageable?,” p. 136. 34 Seckington, “Nationalism, Ideology, and china's Fourth generation leadership.”

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or is more critical of the Party and its actions. The fact that The China That Can Say No, published in 1996, quickly became a bestseller signalled there were growing anti-West sentiments among the Chinese population.35 Furthermore, popular nationalism can be critical of official policy. It certainly calls for more decisive action in defence of China's interests. There were notable spontaneous popular expressions of nationalism in China. Most notable of these were the attacks on the US and UK Embassies in the aftermath of the bombing of the Chinese Embassy in Belgrade. There were further demonstrations after the EP3 incident.36 The fourth generation leadership of China seems determined to continue and deepen China's economic reforms, both for practical and pragmatic reasons - recognise poverty of many people, understand the need for economic development. The CPC recognises that elimination of poverty, improved living standards of people through economic development would legitimate Party's rule. Any deepening of reforms would require greater engagement with the world. This can spark popular outburst along nationalistic lines. Economic reforms bring negative consequences even without the addition of any downturn in China's economic development. There are clear indications that the CPC would remain at the centre of official accounts of the nation's achievements and continue to be the focus of patriotic sentiment. The implication of this is that fourth generation leaders will continue to be constrained in the way that they employ nationalist rhetoric. The deepening reliance on economic development to legitimate the Party-state will exacerbate this problem. The fourth generation's continuing commitment to economic reforms and China's growing integration into the world economy may serve to further disintegration between the official state-centred discourse on patriotism and popular nationalist rhetoric which has been highly critical of these policies.37 35 Song Qiang, Zhang Zangzang, and Biao Bian, Zhongguo keyi shuo bu (The China That Says No) (Beijign: Zhoungguo gongshang chubanshe, 1996). Tianbiao Zhu p. 22. 36 Seckington, “Nationalism, Ideology, and China's Fourth generation leadership.” 37 Ibid.

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In academic discourse on Chinese nationalism, Chinese scholars reject mainstream Western thought that Chinese nationalism is purely an instrument of the Communist Party of China, used to serve its own domestic policy goals. Professor Yu Tiejun, from the School of International Studies at Peking University, stated that “current Chinese nationalism is largely spontaneous, with internet and mobile phones being the main organisational tools. It is outspoken, emotional, radical, and often exaggerated and biased, rather than rational. It was devoid of systematic thought, and results from a mass group mentality in society.”38 He further added that China was in the process of democratisation and unlike the charismatic Chinese leadership in the past, China's foreign policy makers are now more responsive to domestic opinions, especially on those issues related to fundamental foreign policies. “China is changing. Now neither the Party nor the government can ignore the grassroots voices, especially those speaking out against Japan, the main target of modern Chinese nationalism owing to its aggression towards China during the first half of the 20th century.”39 Professor Yu believed that it was not in China's interest to ignite nationalist sentiments against Japan. Chinese leadership had quite a rational stance on that. In April 2005 China's Foreign Minister, Li Zhaoxing, submitted a report to an audience of more 3500 elites in the Great Hall of the People. The main idea of the report was that it was in China's national interest to keep SinoJapanese relations stable and healthy. Li's report was estimated to reach an audience of 200 million in China through television broadcast.40 Furthermore, as China was becoming more open both economically and politically in the new century, it is a real challenge for the government to keep intense popular nationalism under control and therefore maintain a good balance between economic openness and concern for national independence.41 Furthermore, the history of China's foreign relations since 1949 suggests that China should not avoid contact with the existing international 38 “Role of nationalism in Sino-Japan relation”, People's Daily (online), 16 February 2007. 39 Ibid. 40 Ibid. People's Daily (online), 16 February 2007. 41 Zhu, “Nationalism and Chinese Foreign Policy,” p. 22.

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political and economic system. Rather, it should use the system to protect and strengthen itself, and as it becomes strong, to make the system more equal and fair.42 Conclusion Chinese people share a deep rooted historical sense of injustice and humiliation at the hands of foreign countries, as well as a dream of a strong China. These shared feelings generated, for the first time in Chinese history, a deep sense of nationalism among the Chinese people, which successfully overthrew the centuries-old dynastic rule in 1911 and colonial yoke in 1949. After the establishment of the PRC in 1949, the nationalism continued to play its role in both China's domestic set up and in its foreign policy. In both cases, first in developing relations with the Soviet Union and drawing huge economic assistance from Moscow, and then distancing from it and reverting to the policy of self-reliance and isolationism, the Chinese nationalism remained predominant in Mao's thinking. The reverse path of the post-Mao leadership of Deng Xiaoping, which opted for a policy of reforms and “opening up”, was again motivated by the desire of making China a great nation. Likewise, China's third and fourth generation leaderships have aptly used, and when required, revitalised, nationalism to meet both domestic and external challenges. Above all, CPC used nationalism to consolidate its grip on power by successfully integrating itself with the fate of the state. Nationalism would continue to play a consolidating role in China. A statement of one of China's former senior officials seems aptly sums it up: “If Chinese people felt threatened by external forces, the solidarity among the Chinese would be strengthened, and nationalism would be a useful tool for regime to justify its leadership.”43 * Mr. Ghulam Ali is a Research Fellow, China Study Centre, at the Institute of Strategic Studies, Islamabad. 42 Ibid., p. 23. 43 Zhao, “China's Pragmatic Nationalism: Is it Manageable?,” pp. 134-5.

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Kadir AYHAN

East Asian Regionalization and China's Soft Power in Southeast Asia I. East Asian Regionalization1 East Asian regionalization has shown significant progress especially since the Asian financial crisis in 1997. Although it has been criticized that East Asia lacks formal regional institutions, and the regionalism process has not achieved any significant outcomes,2 one should appreciate successful regionalism efforts especially lead by The Association of Southeast Asian Nations (ASEAN). ASEAN was formed in 1967 in Thailand by the five original Member Countries, namely, Indonesia, Malaysia, Philippines, Singapore, and Thailand. Today it has 10 members with the inclusion of Brunei Darussalam in 1984, Vietnam, Lao PDR, Myanmar and Cambodia in late 1990s.3 In 1997, ASEAN Plus Three (ASEAN+3) was established to improve relations with Northeast Asian countries China, Japan and South Korea. Later in 2005, The East Asian Summit (EAS) was introduced to be held annually by India, Australia and New Zealand in addition to ASEAN+3 countries. The EAS was and is seen as a first step to create an East Asian Community by optimists4 while China and Thailand insisted that such a regional community must build on ASEAN+3 form excluding outsiders.5 Geographical area and the vision of an East Asian community is beyond the scope of this paper, but this paper will explore how China's soft power in Southeast Asia -positively and negatively- affects the regionalization efforts. 1 Throughout this paper I preferred the word regionalization over regionalism since many scholars agree that East Asian regionalism is led by regionalization. See Nissim Kadosh Otmazgin, “Cultural Commodities and Regionalization in East Asia,” Contemporary Southeast Asia 27, no. 3 (December 2005): 499-523; Eng Tso Tze, Towards an Asian Union? Asia Europe Journal (2005) 3: 138; T.J. Pempel, “Introduction: Emerging Webs of Regional Connectedness,” Remapping East Asia: The. Construction of a Region, (Ithaca and London: Cornell University Press, 2005): 19; Katzenstein, Peter J., and Shiraishi Takashi. 1997. Network Power: Japan and Asia. Ithaca: Cornell University Press. 2 Jones, David Martin and Michael L.R. Smith. "Making Process, Not Progress: ASEAN and the Evolving East Asian Regional Order." International Security 32 1 (Summer 2007): 148-184. 3 Overview, ASEAN Secretariat official website, http://www.aseansec.org/64.htm Retrieved June 15, 2008 4 Mohan Malik, YaleGlobal, 20 December 2005, The East Asia Summit: More Discord than Accord http://yaleglobal.yale.edu/display.article?id=6645, Retrieved June 15, 2008 5 East Asia Summit: in the shadow of sharp divisions, December 07, 2005 http://english.people.com.cn/200512/07/eng20051207_226350.html Retrieved June 15, 2008

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II. Soft Power Soft power is relatively a new term in the international relations theory, first coined by Joseph Nye in 1990.6 Nye further conceptualized the term in his book named “Soft Power: The Means to Success in World Politics” published in 2004. This paper uses Joseph Nye's definition of 'soft power' with some modifications to utilize it more functionally. Joseph Nye defines soft power as the “ability to get what you want through attraction rather than coercion or payment”.(7) Nye excludes investment and aid from its definition of soft power as economic benefits were often regarded as harder form of influence; however Kurlantzcik argues that investment, aid and other elements outside of the security sphere should be regarded as soft power in the East Asian context.8 Nye groups soft power into three categories, i.e. culture, political values, and foreign policies9 as he suggests that in international affairs “the resources that produce soft power arise in large part from the values an organization or country expresses in its culture, in the example it sets by its internal practices and policies and the way it handles its relations with others.10 Yoshihara and Holmes argue that an appealing culture or political institution creates goodwill in other countries. Furthermore, implementing foreign policies accepted as legitimate amplifies a state's soft power overseas. Therefore, if used properly soft power can increase the likelihood of international cooperation.11 This paper's aim is to analyze China's use of soft 6 Joseph S. Nye Jr., Bound to Lead: The Changing Nature of American Power (U.S.: Basic Books Inc., 1990) 7 Joseph S. Nye Jr., Soft Power: The Means to Success in World Politics (New York: Public Affairs, 2004), p. X. 8 Kurlantzcik, Joshua, "China's Charm Offensive in Southeast Asia." Current History, September 2006: 271. Furthermore, Thomas Lum at al. suggests that Chinese power can include “economic benefits, shared norms and values, cooperation on nontraditional issues, infatuation with the new China, the mutual benefits of tourism and education, diplomacy and style, and networking and reciprocal obligations within ethnic Chinese communities” in the Southeast Asian context. See Thomas Lum, Wayne M. Morrison, and Bruce Vaughn. China's “Soft Power” in Southeast Asia. CRS Report for Congress, Washington: Congressional Research Service, January 2008; Bronson Percival, The Dragon Looks South: China and Southeast Asia in the New Century (Westport: Praeger Publishers, 2007), pp.111-112. See also Hugo Restall, “China's Bid for Asian Hegemony,” Far Eastern Economic Review, May 2007. 9 Joseph S. Nye Jr., Soft Power: The Means to Success in World Politics (New York: Public Affairs, 2004), p. 10. 10 Joseph S. Nye Jr., Soft Power: The Means to Success in World Politics (New York: Public Affairs, 2004), p. 8. 11Holmes, Toshi Yoshihara and James R. "China's Energy-Driven 'Soft Power'." Orbis (Elsevier Limited), 2008: 123-137.

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power in Southeast Asia to evaluate whether the likelihood of international cooperation (and of regionalization) increased in the region. a.China's Soft Power in Southeast Asia China has recognized the significance of soft power and employed it in many areas to extend its influence in many regions and also in Southeast Asia. Some scholars argue that China prefers soft power over hard power in Southeast Asia because it cannot match United States' hard power, and it is rather unclear whether China's strategy will change to a more aggressive one in the future.12 On the other hand, some scholars argue that China employs soft power in order to mitigate “threat of China rise” in the neighborhood and convince the Southeast Asian countries that its economic development is “peaceful rise” as China is a “responsible stakeholder in the region”.13 China officially refers to its economic progress as “peaceful development” and declares that China desires a “harmonious world” as Confucius teachings would suggest.14 This paper will examine China's soft power resources on three main areas in accordance with Nye's differentiation: China's foreign policies, China's political values, and Chinese culture. According to Gill and Huang and some other authors, China's soft power in Southeast Asia has increased in all three areas,15 while the author of this article thinks it increased in terms of foreign policies and culture, but not as much in political values. There are counterproductive effects of China's soft power in the region too, especially in China's foreign policies and political ideology. 12 Cohen, Danielle. "China's Soft Power in Southeast Asia: What Does It Mean for the Region, and for the U.S.?" Carnegie Endowment for International Peace. June 13, 2006. http://www. carnegieendowment.org/events/index.cfm?fa=eventDetail&id=892 (accessed June 14, 2008); Pak, Jin H. "China's Pragmatic Rise and U.S. Interests in East Asia." Military Review, 2007: 55-69; Thomas Lum, Wayne M. Morrison, and Bruce Vaughn. China's “Soft Power” in Southeast Asia. CRS Report for Congress, Washington: Congressional Research Service, January 2008 13 Thomas Lum, Wayne M. Morrison, and Bruce Vaughn. China's “Soft Power” in Southeast Asia. CRS Report for Congress, Washington: Congressional Research Service, January 2008. 14 Young Nam Cho, Jong Ho Jeong. "China's Soft Power: Discussions, Resources, and Prospects." Asian Survey (forthcoming), 2008: 1-41. 15 See Holmes, Toshi Yoshihara and James R. "China's Energy-Driven 'Soft Power'." Orbis (Elsevier Limited), 2008: 123-137; Kurlantzick, Joshua. "China Buys The Soft Sell." The Washington Post. October 15, 2006. http://www.washingtonpost.com/wp-dyn/content/article/ 2006/10/13/AR2006101301401.html (accessed June 7, 2008); Bates Gill and Yanzhong Huang, “Sources and Limits of Chinese 'Soft Power',” Survival 48: 2 (Summer 2006).

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III. China's Foreign Policy China's foreign policy attitude has been transforming since the end of Mao era. During Mao Zedong's administration China supported class-based revolutionary struggles by communist parties or insurgent groups in Southeast Asia.16 Even in the early 1990s, China had made aggressive moves in the form of hard power such as sending ships to disputed islands in the South China Sea.(17) Since mid-1990s, however, China's foreign policy focused on allaying fears of Southeast Asian nations by presenting China's 'peaceful rise' theory (later substituted by 'peaceful development' theory by President Hu Jintao) which was coined by Zheng Bijian the former CCP Central Party School's vice-president-in 2003 as a response to 'China threat' theory.18 The turning point for the transformation was the Asian financial crisis when China abstained from devaluing its currency (RMB) and contributed to stabilization of the East Asian economies. This move was appreciated by ASEAN members, and China advertised its decision as standing up for other 'Asian' nations which helped it to increase its soft power. This in turn helped Asian states to integrate further and intensify the hopes for regionalization.19 16 Osborne, Milton, “The Paramount Power – China and the Countries of Southeast Asia,” Sydney, Lowy Institute for International Policy, Issues Paper, May 2006; Thomas Lum, Wayne M. Morrison, and Bruce Vaughn. China's “Soft Power” in Southeast Asia. CRS Report for Congress, Washington: Congressional Research Service, January 2008. 17 Kurlantzcik, Joshua, "China's Charm Offensive in Southeast Asia." Current History, September 2006: 270-276; Joshua Kurlantzick, “Pax Asia-Pacifica: Asia's Emerging Identity and Implications for U.S. Policy,” Pacific Council on International Policy and USC Center for Public Diplomacy, April 2007; David Shambaugh, Power Shift (Berkeley, Calif.: University of California Press, 2005), p. 70; Thomas Lum, Wayne M. Morrison, and Bruce Vaughn. China's “Soft Power” in Southeast Asia. CRS Report for Congress, Washington: Congressional Research Service, January 2008. 18 Young Nam Cho, Jong Ho Jeong. "China's Soft Power: Discussions, Resources, and Prospects." Asian Survey (forthcoming), 2008: 28; Nye, Joseph S. "The Rise of China's Soft Power." The Wall Street Journal, 2005: 45. 19 Joshua Kurlantzick, “Pax Asia-Pacifica: Asia's Emerging Identity and Implications for U.S. Policy,” Pacific Council on International Policy and USC Center for Public Diplomacy, April 2007; Kurlantzick, Joshua. "China Buys The Soft Sell." The Washington Post. October 15, 2006. http://www.washingtonpost.com/wp-dyn/content/article/2006/10/13/AR2006101 301401.html (accessed June 7, 2008); David M. Lampton, "China's Rise in Asia Need Not Be at America's Expense," in Power Shift: China and Asia's New Dynamics, ed. David Shambaugh (Berkeley: University of California Press, 2005), pp. 307. 185

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Transformation of China's foreign policy became more apparent as China has started to participate more willingly in multilateral frameworks emphasizing mutual benefits in its relations with Southeast Asian nations. China has clearly emphasized soft power over hard power as it complied with a more accommodating posture. China signed Declaration of Parties in the South China Sea with other claimant nations to disputed islands to reduce tensions in the region.20 Furthermore, it settled other longterm border disputes with Russia and Vietnam.21 Improved confidence between the parties increased China's soft power and paved the way for further integration. China's soft power was fostered when China has signed ASEAN's Treaty of Amity and Cooperation (TAC) which was the first such agreement China has signed.22 Especially, United States' failure to sign a similar agreement gave China more soft power privilege in its relations with the Southeast Asian nations. China has also proposed creating a conference to improve communications among Asian militaries using the ASEAN Regional Forum (ARF).24 China has successfully managed its relations with ASEAN as a group as well as its bilateral relations with individual states. It has been argued that through this strategy China treated ASEAN as a collective body with lowest common denominator and increased its soft power for doing so.25 Thomas Lum at al. argued that China's soft power in Southeast Asia was mostly economic (such as investment, trade and aid) rather 20 Thomas Lum, Wayne M. Morrison, and Bruce Vaughn. China's “Soft Power” in Southeast Asia. CRS Report for Congress, Washington: Congressional Research Service, January 2008. 21 Jean Garrison, “China's Prudent Cultivation of 'Soft' Power and Implications for U.S. Policy in East Asia”, Asian Affairs: An American Review, Spring, 2005. 22 Jean Garrison, “China's Prudent Cultivation of 'Soft' Power and Implications for U.S. Policy in East Asia”, Asian Affairs: An American Review, Spring, 2005; Kurlantzick, Joshua. "China Buys The Soft Sell." The Wasington Post. October 15, 2006. http://www.washingtonpost.com/ wp-dyn/content/article/2006/10/13/AR2006101301401.html (accessed June 7, 2008). 23 Osborne, Milton, “The Paramount Power – China and the Countries of Southeast Asia,” Sydney, Lowy Institute for International Policy, Issues Paper, May 2006; Tim Shorrock, 'Why Southeast Asia is turning from US to China', Asia Times Online 10 December 2005. http://www.atimes.com/atimes/Southeast_Asia/GL10Ae01.html (accessed June 14, 2008). 24 Jean Garrison, “China's Prudent Cultivation of 'Soft' Power and Implications for U.S. Policy in East Asia”, Asian Affairs: An American Review, Spring, 2005. 25 Tim Shorrock, 'Why Southeast Asia is turning from US to China', Asia Times Online 10 December 2005. http://www.atimes.com/atimes/Southeast_Asia/GL10Ae01.html (accessed June 14, 2008).

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than cultural or political.26 Joseph Nye also argues that China attracted other nations by economic aid and access to its growing market.27 Between 1997 and 2006, China's exports from ASEAN countries grew by %450, while its exports to ASEAN countries grew by 625%.28 China and ASEAN have become more interdependent and more integrated in terms of trade, investment and tourism. This interdependence is likely to increase China's soft power in Southeast Asian countries. Garrison argues that East Asian investment patterns further strengthen China-centered regional interdependence which provides ASEAN states with incentives to promote a stable framework for bilateral relations to maintain prosperity.29 Taken into account the fact that Asian integration has relatively been bottom-up fashion driven by economic goals, this interdependence is a good sign for East Asian regionalization. In 2002, China and ASEAN signed the Framework Agreement on Comprehensive Economic Cooperation to form an ASEAN-China Free Trade Area (ACFTA) within 10 years. In addition, it is important to note that China had $18.2 billion trade deficit with ASEAN, while it had a $178 billion trade surplus with the world in 2006.30

26 Thomas Lum, Wayne M. Morrison, and Bruce Vaughn. China's “Soft Power” in Southeast Asia. CRS Report for Congress, Washington: Congressional Research Service, January 2008. 27 Nye, Joseph S. "The Rise of China's Soft Power." The Wall Street Journal, 2005: 45. 28 Martin, Michael F., What's the Difference?—Comparing U.S. and Chinese Trade Data. CRS Report, Washington: Congressional Research Service, 2007. 29 Jean Garrison, “China's Prudent Cultivation of 'Soft' Power and Implications for U.S. Policy in East Asia”, Asian Affairs: An American Review, Spring, 2005. 30 Thomas Lum, Wayne M. Morrison, and Bruce Vaughn. China's “Soft Power” in Southeast Asia. CRS Report for Congress, Washington: Congressional Research Service, January 2008.

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China has become a major aid donor in Southeast Asia. A 2006 study by Henry Yep of National Defense University in 2003 illustrated that China's aid to the Philippines was almost four times greater than U.S. aid; China's aid to Laos was almost three times greater than U.S. aid. In 2002, China's aid to Indonesia almost doubled U.S. aid. Chinese aid was different than traditional development aids as it was aimed at promoting Chinese companies, cultivating political actors, and mitigating concerns about China's economic rise. Some of the China's economic assistance was allocated for study trips of Southeast Asian diplomats, and also purchasing of surplus agricultural products to conciliate Southeast Asian farmers who were worried about the effect of trade with China. This in turn, increased China's soft power in both ends: diplomats, and publics.31 Furthermore, since China offers economic assistance without the conditions Western sources frequently place on aid (such as market opening, environmental protections), China's aid receives much appreciation (high symbolic value) from recipient Southeast Asian governments compared to the actual size of the aid.32 China's unconditional (or less conditional) aid increased its soft power in the region, leading to higher mutual trust between Southeast Asian states and China. Southeast Asian nations are more convinced of China's “peaceful development”. Moreover, China prefers to stay out of Southeast Asian countries' internal affairs. China advertises this decision as its respect for those countries' sovereignty. That is the reason why China gives less conditional assistance to Southeast Asian nations. Authoritarian regimes are the happiest with this 'non-interference' strategy, while China also earns public appreciation for its respect in sovereignty-conscious ex-colonial states (in addition to their colonial past, the U.S. often intervenes in Southeast Asian domestic affairs demanding economic and political concessions.).33 31 Kurlantzick, Joshua. "China Buys The Soft Sell." The Washington Post. October 15, 2006. http://www.washingtonpost.com/wp-dyn/content/article/2006/10/13/AR2006101301401.html (accessed June 7, 2008). 32 Kurlantzcik, Joshua, "China's Charm Offensive in Southeast Asia." Current History, September 2006: 270-276; Kurlantzick, Joshua. "China Buys The Soft Sell." The Washington Post. October 15, 2006. http://www.washingtonpost.com/wp-dyn/content/article/2006/10/13/ AR2006101301401.html (accessed June 7, 2008). 33 Kurlantzcik, Joshua, "China's Charm Offensive in Southeast Asia." Current History, September 2006: 270-276.

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However, non-interference and unconditional aid is not a onedimension issue. INGOs, local groups and many foreign experts have criticized Chinese assistance for failing to promote sustainable development and environmental conservation.34 In the long-run non-interference policy can backfire at China diminishing its soft power. A concrete example is China's non-interference or even protection of the junta leaders in Burma and in Cambodia. Premier Wen Jiabo said “Human rights issues in Burma were Rangoon's internal affair”.35 China's non-interference attitude and economic assistance to Burma often undermined the U.S.' and ASEAN's efforts to sanction the junta.36 While China's soft power increase in the sense that its respect for Southeast Asian nations' sovereignty is appreciated, China's soft power can also become disastrous in the eyes of the opposition parties, journalists and the oppressed public in those countries and transnational advocacy networks elsewhere. China has been controlling development from the top, therefore Chinese model rejects the idea that public should control their countries' destinies as in democracies.37 This itself is a potential threat for the future of China's soft power in the region as China needs to win popular level soft power too. Lastly, China was criticized for not listening to the Southeast Asian nations' concerns about the environmental and social impact of dams on China's side of the Mekong River. China has even declined to join the Mekong River Commission.38 China's unilateral approach in the case of production of dams in 34 Thomas Lum, Wayne M. Morrison, and Bruce Vaughn. China's “Soft Power” in Southeast Asia. CRS Report for Congress, Washington: Congressional Research Service, January 2008; Osborne, Milton, “The Paramount Power – China and the Countries of Southeast Asia,” Sydney, Lowy Institute for International Policy, Issues Paper, May 2006. 35 Rowan Callick, 'Chinese heat on Rangoon', The Australian, 16 February 2006. 36 Seth Mydans, 'China woos Myanmar as Asean seeks a way to deal with is leaders', International Herald Tribune, 28 July 2005 http://www.iht.com/articles/2005/07/28/news/ asean.php (Accessed June 15 2008); Ralph A. Cossa, 'You are judged by the company you keep', International Herald Tribune, 6 September 2005. http://www.iht.com/articles/2005/09/05/ opinion/edcossa.php (Accessed June 15 2008); Osborne, Milton, “The Paramount Power – China and the Countries of Southeast Asia,”Sydney, Lowy Institute for International Policy, Issues Paper, May 2006; Kurlantzick, Joshua. "China's charm." Policy Brief, 2006: 1-8. 37 Kurlantzcik, Joshua, "China's Charm Offensive in Southeast Asia." Current History, September 2006: 270-276.

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the Mekong River may decrease its soft power in the region and may disprove its 'peaceful development' theory. Lack of cooperation on this issue, in turn, affects regionalization negatively as it may be a sign of a future unilateral approach by China when it finds the opportunity. IV. China's Political Values China's economic growth attracted many Southeast Asian countries' attention. China remains authoritarian but has a roughly market economy. Ramo called this kind of development system “Beijing Consensus”. Beijing consensus39 is taken as a development model by especially authoritarian leaders in Southeast Asia who want to stay in power while their countries achieve some economic growth.40 Beijing consensus has been seen as an instrument of soft power. While Beijing consensus increases China's soft power in authoritarian countries, it decreases soft power in rather more democratic Southeast Asian countries who wish to see authoritarian regimes democratized.41 Southeast Asian countries seeing China as a role model is a positive sign for regionalization, however Beijing Consensus' encouragement of authoritarian regimes (that are supposed to be less likely to cooperate and are more difficult to work with) undermines regional cooperation. Furthermore, Young Nam Cho and Jong Ho Jeong referred to some anti-globalization groups' criticisms of America-led globalization and neo-liberalism backing the arguments of the Beijing Consensus. They argued that if these groups continue to use Beijing Consensus to criticize neoliberalism and globalization, China may be misunderstood as antiwestern and as a major challenger to the established global 38 Kurlantzick, Joshua. "China's charm." Policy Brief, 2006: 1-8; Perlez, Jane. "China's Reach, The Trouble Downstream: In Life on the Mekong, China's Dams Dominate." The New York Times. March 19, 2005. http://www.nytimes.com/2005/03/19/international/asia/19mekong.html? r=2&scp=1&sq=mekong+dam&st=nyt&oref=slogin&oref=slogin (accessed June 14, 2008); Zeller, Frank. "New rush to dam Mekong alarms environmentalists." Turkish Daily News. April 1, 2008.http://www.turkishdailynews.com.tr/article.php?enewsid=100511 (accessed June 14, 2008). 39 Joshua Cooper Ramo, Beijing Consensus (London: The Foreign Policy Centre, 2004), pp. 3-4. 40 Young Nam Cho, Jong Ho Jeong. "China's Soft Power: Discussions, Resources, and Prospects." Asian Survey (forthcoming), 2008: 1-41, Nye, Joseph S. "The Rise of China's Soft Power." The Wall Street Journal, 2005: 45; Joshua Cooper Ramo, Beijing Consensus (London: The Foreign Policy Centre, 2004), pp. 3-4; Bates Gill and Yanzhong Huang, “Sources and Limits of Chinese 'Soft Power',” Survival 48: 2 (Summer 2006), pp. 20-21. 41 Young Nam Cho, Jong Ho Jeong. "China's Soft Power: Discussions, Resources, and Prospects." Asian Survey (forthcoming), 2008: 1-41; Nye, Joseph S. "The Rise of China's Soft Power." The Wall Street Journal, 2005: 45; Kurlantzcik, Joshua. "China's Charm Offensive in Southeast Asia." Current History, September 2006: 270-276.

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order even if it does not wish to seem so.42 China's soft power's weakest points are its human rights records, known corruption (especially among the Communist party elites), inequality, and a lack of democracy.43 Since Southeast Asian countries are not any more prosper than China, China's soft power is not seen to be decreasing in the region due to these negative factors. However, as transnational advocacy networks gain more power through media, NGOs and other channels, China's political values is likely to diminish its soft power in the region. To this date, China has managed its foreign diplomacy successfully (after the transformation), so that China's political values have not been criticized as much. Kurlantzcik points out to the fact that in contrast to early 2000s, it is very difficult to find Southeast Asian leaders criticizing China.44 Elsewhere, he also referred to an analysis which illustrated that about ten years ago the Southeast Asian media frequently criticized China's economic and security policies, whereas such coverage is unlikely today.45 However, no one can guarantee how far Southeast Asian nations (or ASEAN as a collective body) can play 'three monkeys' for China's antidemocratic and authoritarian regime. In the light of the Beijing Olympics, the world protests China's human rights violations in Tibet. This is definitely dampening China's soft power in Southeast Asia as well as in other parts of the 'globalized' world. Furthermore, China's human rights violations also take place in China is Xinjiang (Uyghur) another autonomous area in (North-) West China. However, due to lack of access to Xinjiang and less information outflow (and lack of a charismatic leader like Dalai Lama), little is known about the human rights violations in the region.46 Especially, Muslim nations of Southeast Asia may take more interest about human rights issue in Xinjiang which will worsen China's soft power in those countries. 42 Young Nam Cho, Jong Ho Jeong. "China's Soft Power: Discussions, Resources, and Prospects." Asian Survey (forthcoming), 2008: 1-41; Zhang Jianjing, Zhongguo Jueqi [Rise or Else: China's Road to a Great Power] (Beijing: Xinhua chubanshe, 2005),pp. 164. 43 Nye, Joseph S. "The Rise of China's Soft Power." The Wall Street Journal, 2005: 45. 44 Kurlantzcik, Joshua, "China's Charm Offensive in Southeast Asia." Current History, September 2006: 270-276. 45 Kurlantzick, Joshua. "China's charm." Policy Brief, 2006: 1-8. 46 Kurlantzick, Joshua. How China's Soft Power is Transforming the World. San Francisco, May 21, 2007. http://www.asiasociety.org/resources/kurlantzick.html (accessed June 7, 2008)

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Another problem can be increasing nationalism sentiment in China. Nationalism has been an essential part of political value in China to keep the nation united.47 Although nationalism can be a factor that can decrease Chinese soft power as it contradicts with China's 'good neighbor' policy, its negative effects would less likely to reflect in Southeast Asia. Chinese nationalism has generally focused on Northeast Asia as seen in the case of anti-Japanese protests in 2005 and clash with the Korean police in Seoul in 2008. However, an ideological Han Chinese nationalism is seen as the source of suppression of other races inside China such as Tibetans and Uyghurs. Therefore, human rights problems can be traced to nationalism ideology which potentially dampens China's soft power and affects regionalization negatively (since an East Asian community would need to include Northeast nations such as South Korea and Japan, nationalism is a greater threat against regional integration). V.Chinese culture Yim and Janelli argue that a nation can expand its influence over another by exporting its culture especially when the two nations find mutually beneficial grounds for economic or military reasons.48 In terms of soft power, Kurlantzick suggests that “it stems from both governments and nongovernment actors—from businesspeople and pop stars and language teachers.” Nongovernment actors also increase a state's soft power especially when they are backed by their state's policies.49 China has been successful to increase its soft power through exportation of its culture. China has established 24 hour broadcasting channels targeting Southeast Asian nations. Chinese language and cultural studies have become much more popular recently, especially with 47 Holmes, Toshi Yoshihara and James R. "China's Energy-Driven 'Soft Power'." Orbis (Elsevier Limited), 2008: 129; Bates Gill and Yanzhong Huang, “Sources and Limits of Chinese 'Soft Power',” Survival 48: 2 (Summer 2006), p.30. 48Roger L. Janelli, Dawnhee Yim. "Soft Power, Korea, and the Politics of Culture." Catching the Wave: Connecting East Asia through Soft Power. Berkeley: Institute of East Asian Studies University of California, 2007. 1-7. Nye often treats "soft power" as if it were effective in its own right. "If you believe my objectives are legitimate, I may be able to persuade you to do something for me without using threats or inducements." Soft Power: The Means to Success in World Politics" (New York: Public Affairs,2004), p. 2) 49 Kurlantzcik, Joshua, "China's Charm Offensive in Southeast Asia." Current History, September 2006: 270-276.

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the government's promotion. By 2008, China's universities are going to enroll over 120,000 foreign students according to reports, as opposed to about 8,000 students two decades ago.50 In contrast to Thomas Lum at al.'s inference that China's growing soft power is mostly economic rather than cultural,51 Young Nam Cho and Jong Ho Jeong argue that the greatest source of China's soft power is the Chinese civilization.52 Considering long history of the Chinese civilization, and its sustainability as compared to China's economic development Cho and Jeong's argument is stronger. Furthermore, China's soft power that is stemmed from economics has always been subject of discussions and is likely to be a negative soft power that backfires at China as discussed in the previous parts (e.g. unconditional aid, Beijing consensus), whereas Chinese civilization, or Chinese culture, if promoted successfully, will always generate positive soft power on the side of China. China has drawn attention to Zheng He's voyage in which “not one inch of land was occupied”, whereas he “brought silk, tea and the Chinese culture” to foreign peoples.53 The implied meaning is that Chinese civilization has been benign and friendly to other nations. Chinese civilization and history helps China to advocate Asian values such as the importance of family as the focal point of social structure formation, concerns over virtues and ethics, the primacy of the group over the individual, emphasis on unity or harmony and order, hard work, frugality and the importance of education.54 China can even create an imagined an Asian identity and values using the common memories of Asian 50 Kurlantzick, Joshua. "China's charm." Policy Brief, 2006: 1-8. 51 Thomas Lum, Wayne M. Morrison, and Bruce Vaughn. China's “Soft Power” in Southeast Asia. CRS Report for Congress, Washington: Congressional Research Service, January 2008. 52 Young Nam Cho, Jong Ho Jeong. "China's Soft Power: Discussions, Resources, and Prospects." Asian Survey (forthcoming), 2008: 1-41. 53 Chen Jian and Zhao Haiyan, ''Wen Jiabao on Sino-US Relations: Cherish Harmony; Be Harmonious But Different,'' Zhongguo Xinwen She, December 8, 2003, FBISCPP20031208000052. The theme that Zheng He did not occupy foreign lands resurfaces repeatedly in official statements and government-controlled media outlets. See ''Africa at Large: Global Influence Driving Hu Jintao's Africa Trip,'' Inter Press Service, January 30, 2007, at www.afrika.no; ''African Reporters Expecting More 'China Voices,''' Xinhua, November 3, 2006. 54 Young Nam Cho, Jong Ho Jeong. "China's Soft Power: Discussions, Resources, and Prospects." Asian Survey (forthcoming), 2008: 1-41; Chong-Min Park and Doh Chull Shin, “Do Asian Values Deter Popular Support for Democracy in South Korea?” Asian Survey 46: 3 (May/June 2006), p. 343.

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history such as the Western colonial invasion.55 Shared Confucian values and Chinese characters would also help create common bonds; however this is rather irrelevant in Southeast Asia apart from Vietnam. China has long been trying to persuade Southeast Asian nations (and the world) that its economic growth is 'peaceful development', and China is a 'good neighbor' with benign attitude. The goal was to increase China's soft power in the region to convince other nations to take its lead without coercion. China has given significance to promotion of its culture as they have witnessed America's soft power strategy in the collapse of socialism in the Soviet Union and Eastern Europe. Therefore, China has seen the need to balance dominant American culture by protecting and promoting traditional Chinese culture.57 One way that was followed for this goal was establishment of Confucius Institutes in Southeast Asia (and all over the world) to promote a kinder and gentler image of China and to counterattack 'China threat' theory present in the international community.58 There is also an implied meaning in the promotion of Confucianism as Chinese values, i.e. China accepts Confucian diplomatic principles such as 'live peacefully with neighbors, bring prosperity to them, and provide safety to them' and a 'harmonious world”.59 As of March 2007, 140 Confucius Institutes have been established to increase China's soft power all over the world.60 55 Young Nam Cho, Jong Ho Jeong. "China's Soft Power: Discussions, Resources, and Prospects." Asian Survey (forthcoming), 2008: 1-41. 56 Joseph S. Nye Jr., Soft Power: The Means to Success in World Politics (New York: Public Affairs, 2004), p. 2. 57 Young Nam Cho, Jong Ho Jeong. "China's Soft Power: Discussions, Resources, and Prospects." Asian Survey (forthcoming), 2008: 1-41. 58 Bates Gill and Yanzhong Huang, “Sources and Limits of Chinese 'Soft Power',” Survival 48: 2 (Summer 2006); Repackaging Confucius: PRC Public Diplomacy and the Rise of Soft Power Xiaolin Guo ASIA PAPER 59 Young Nam Cho, Jong Ho Jeong. "China's Soft Power: Discussions, Resources, and Prospects." Asian Survey (forthcoming), 2008: 1-41. 60 Howard French, “Another Chinese Export Is All the Rage: China's Language,” New York Times, January 11, 2006, , Accessed June 15, 2008.

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According to Guo, 210 institutes were established in more than 60 countries while about 60 universities and organizations promote Confucian values abroad by December 2007. The Institute engages in education at a popular level rather than targeting the elites, increasing Chinese soft power on the public level.61 China also dispatched language teachers to Southeast nations, promoted Chinese language and Chinese studies there through Chinese Ministry of Education. Recently 2,000 volunteer Chinese language instructors went all over the world to teach Chinese.62 Chinese has become a second or third language in many Southeast Asian nations today.63 Chinese authorities forecast that 100 million people worldwide will learn Chinese in ten years.64 Moreover, Beijing has created China Association for Young Volunteers (similar to the American Peace Corps) to send young international volunteers to developing countries such as those of Southeast Asia.65 Number of international student in China has been tripled to more than 110,000 in ten years, while the number of tourists increased to 17 million in 2004.66 Spread of Chinese language, voluntary work of Chinese youth, student exchanges increased China's soft power in the region. In addition to traditional culture, China is also competing in the global popular culture arena. 2000 Nobel Prize for Literature came to China for Chinese novelist Gao Xingjian's “The Other Shore” and the Chinese film “Crouching Tiger, Hidden Dragon” 61 Guo, Xiaolin, “Repackaging Confucius PRC Public Diplomacy and the Rise of Soft Power.” Singapore: Institute for Security and Development Policy, 2008. 62 Kurlantzick, Joshua. "China Buys The Soft Sell." The Washington Post. October 15, 2006. http://www.washingtonpost.com/wp-dyn/content/article/2006/10/13/AR2006101301401.html (accessed June 7, 2008). 63 Guo, Xiaolin, “Repackaging Confucius PRC Public Diplomacy and the Rise of Soft Power.” Singapore: Institute for Security and Development Policy, 2008. 64 Holmes, Toshi Yoshihara and James R. "China's Energy-Driven 'Soft Power'." Orbis (Elsevier Limited), 2008: 123-137. 65 Guo, Xiaolin, “Repackaging Confucius PRC Public Diplomacy and the Rise of Soft Power.” Singapore: Institute for Security and Development Policy, 2008; Kurlantzick, Joshua. "China Buys The Soft Sell." The Washington Post. October 15, 2006. http://www.washingtonpost.com/ wp-dyn/content/article/2006/10/13/AR2006101301401.html (accessed June 7, 2008). 66 Nye, Joseph S. "The Rise of China's Soft Power." The Wall Street Journal, 2005: 45.

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topped highest grossing non-English film.67 Hong Kong film 'Infernal Affairs' was remade in Hollywood with the name 'The Departed'. Jackie Chan, Jet Li and other Chinese actors are famous throughout the world. Guo argued that China is building soft power by creating a “brand value culture” which includes “Great Wall, Giant Panda, Peking Opera, Olympic champions, film stars, spaceships, the Three-Gorges Dam” as well as Confucius.68 While this brand value culture is promoted worldwide, Chinese popular culture (Chinese dramas, Chinese pop) is more widespread in Southeast Asia, especially because of some 30 million ethnic Chinese living in Southeast Asia.69 Chinese popular culture has contributed to the emergence of a shared East Asian consumer culture. Apart from the dominant American popular culture in the East Asian markets, regional culture has been developed and intensified as entrepreneurs, companies, and promoters in East Asia have formed alliances that brought about the emergence of a regional market for culture and connected individuals and communities (especially the middle class). Otmazgin argues that many East Asians today, have similar consumption habits, lifestyle trends and consume similar popular culture products. He suggests that ethnic Chinese from Taiwan, Hong Kong, Singapore, and mainland China has become AsianChinese idols, and created a pan-Asian Chinese pop music that became region-wide popular.70 Popular culture occupies a very significant place in regionalization since East Asian regionalization has been market71 driven. As noted in the beginning of the paper, regional economic and consumerist activities are driving East Asian regionalization 67 Nye, Joseph S. "The Rise of China's Soft Power." The Wall Street Journal, 2005: 45. 68 Guo, Xiaolin, “Repackaging Confucius PRC Public Diplomacy and the Rise of Soft Power.” Singapore: Institute for Security and Development Policy, 2008. 69 Holmes, Toshi Yoshihara and James R. "China's Energy-Driven 'Soft Power'." Orbis (Elsevier Limited), 2008: 123-137. 70 Nissim Kadosh Otmazgin, Cultural Commodities and Regionalization in East Asia; Joshua Kurlantzick, “Pax Asia-Pacifica: Asia's Emerging Identity and Implications for U.S. Policy,” Pacific Council on International Policy and USC Center for Public Diplomacy, April 2007; David Shambaugh, Power Shift (Berkeley, Calif.: University of California Press, 2005), p. 72. 71 Nissim Kadosh Otmazgin, “Cultural Commodities and Regionalization in East Asia,” Contemporary Southeast Asia 27, no. 3 (December 2005): 499-523.

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while top-down regionalism and institutionalization has been 72 slow. Therefore, increased Chinese soft power through promotion of its popular culture and creation of an imagined panAsian culture is contributing to emergence of an Asian identity and this is a positive sign for East Asian regionalization. Conclusion China has discovered the significance of soft power and employed it in Southeast Asia, its immediate neighborhood, as well as other parts of the world. Through the use of soft power China aimed to allay the fears of Southeast Asian nations and disprove the 'China threat' theory, while promoting 'peaceful development theory' which insisted that China's growth is not only beneficial for China, but it is beneficial for the region. China's has improved its ability to influence Southeast Asian countries by persuasion, rather than coercion which implies that its soft power increased in the region. China's attractiveness was created through various means, including promotion of culture, peaceful diplomacy, participation in multinational organizations, Chinese businesses' activities abroad, and the benefits of China's growing economy. China's soft power increased in Southeast Asia in terms of culture and foreign policies. Promotion of Confucian values and Chinese courses abroad, contributions to emergence of a common East Asian consumer culture extended China's soft power in Southeast Asia. China's transformation from an aggressive attitude to a responsible member of the region, increasing aid and investment in the Southeast Asia, increasing interdependence of the region and China, its respect of Southeast Asian nations' sovereignty have contributed to expanding Chinese soft power in the region. On the other hand, its support for regimes in Burma and Cambodia, unconditional aid programs in Southeast Asia, unilateral approach when possible has worsened its image and China should address those and other issues more carefully in order 72 See Nissim Kadosh Otmazgin, “Cultural Commodities and Regionalization in East Asia,” Contemporary Southeast Asia 27, no. 3 (December 2005): 499-523; Eng Tso Tze, Towards an Asian Union? Asia Europe Journal (2005) 3: 138; T.J. Pempel, “Introduction: Emerging Webs of Regional Connectedness,” Remapping East Asia: The. Construction of a Region, (Ithaca and London: Cornell University Press, 2005): 19; Katzenstein, Peter J., and Shiraishi Takashi. 1997. Network Power: Japan and Asia. Ithaca: Cornell University Press.

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to expand its soft power even more. While China's soft power increased in the mentioned two dimensions, it seemed to decrease in the political values dimension. Although Beijing Consensus has been followed with appreciation in most Southeast Asian nations, its encouragement of authoritarian regimes has decreased China's soft power in the eyes of publics. China should also focus more on improving its soft power in the popular level, rather than targeting the elites only. This being said, human rights, corruption and other domestic problems should be addressed well in order to avoid future worsening of its soft power in Southeast Asia. Increased soft power of China in Southeast Asia enabled integration of China and ASEAN members. Mutual confidence has been built with the help of soft power. The fact that East Asian regionalism is driven by bottom-up regionalization, soft power (and non-governmental forces such as businesses, public, media, culture, NGOs etc.) has great significance in improving integration. The scope of this paper was China's soft power in Southeast Asia. An East Asia-wide soft power research can enlighten soft power's role in East Asian regionalization more. This would require analysis of Northeast Asian nations', Southeast Asian nations' and America's soft power in East Asia, how it contributed to the East Asian regionalization, and its shortcomings.

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A Critical Approach to China's African Policy Introduction Why are the powers capable of challenging US dominance militarily or economically unable or unwilling to challenge the US politically? The traditional balance of power (BOP) approach, which looks at distribution of interests and capabilities at state level, falls at times short of answering this question. The Critical Theory of International Relations (CTIR), which analyzes social power relations at both domestic and transnational levels, demonstrates the mechanisms of the neo-liberal order in which the US currently enjoys hegemonic power, and in which other capable powers opt not to challenge the US hegemony. Hegemony here is used not merely as a dominance of a state over the others but a consensual order in which people and social forces continuously reproduce. The consent is maintained and perpetuated not only through material capabilities but also the institutions and ideas, and eventually consolidated into an historic bloc in which various class interests are integrated. Therefore, according to CTIR, the global world order, which is a transnational historic bloc in neoGramscian terminology, is maintained through social forces crosscutting national boundaries, unless a politically-formed nationalist bloc hinders the global capital accumulation. In such a world order, systemic change is initiated by social forces beyond the national and international levels. That is, it can be misleading to look at states for a counter-hegemonic movement since the real challenge to the historic bloc would come from social forces and classes transcending national boundaries. From a BOP point of view, China is often depicted as a threat to the current global world order due to its rapidly growing material capabilities and nationalist foreign policy. This paper, however, argues that Chinese foreign policy does not constitute a threat to the neo-liberal order because China, since the opening up in the 1980s, has been fully engaged in the norms and institutions of the neoliberal historic bloc, and, above all, the Chinese political and economical elite are now wholly incorporated into the order. Some particular policies and actions of China might challenge American 200

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hegemony, but even such a confrontation would eventually reinforce the prevailing order because these policies and actions are also in conformity with the culture and norms of the neo-liberal historic bloc. 　　　 The case study of this paper is China's new African policy because the new phase in China's Africa policy successfully demonstrates the ways in which Chinese economic and political elite create alternatives to the US domination, without altering the social relations of production and the social forces in African continent. The paper has two sections. The first section portrays how CTIR describes the international system in terms of Gramscian hegemony in general and the US-led neo-liberal historic bloc in particular; the second section places China's African policy into this theoretical framework in order to understand whether China constitutes a challenge to the system. This part also analyzes China's African policy in historical perspective in order to make the change in policy clear. Finally, China's view of the US-led neo-liberal transnational historic bloc is offered as a solution to the controversy over the perceptions. In both sections, China's conception of the structure and issues of the world order is taken as the basis of the analysis, on the grounds that actors shape their actions and attitudes in accordance with how they conceive the environment in which they operate. Therefore, a discourse analysis of first-hand materials, such as China's official foreign policy documents and media coverage of certain foreign policy issues, is conducted in order to reach an understanding of China's stance on these issues. 1. Theoretical Framework How does the Critical Theory of IR conceive the world? The Critical theory of International Relations (CTIR) explains the international system in terms of power embedded in social relations of production and constantly reproduced in discourses. It has its origins in the Marxist theory of domination and class consciousness; but it also goes beyond Marxism by asserting that it is the ideology of the dominant class which shapes the relations of production, not the other way around. Gramsci's concept of hegemony is modus operandi of the system that CTIR pictures. 201

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Before going into details of CTIR, it is timely to look at the mainstream theories of Balance of Power (BOP), of which CTIR is directly and explicitly critical, for clarification because CTIR sees the international system build upon the power relations of its actors. By doing that, at first glance CTIR seems similar to BOP itself. Nonetheless, these two theories differ at several fundamental points. To start with, BOP theories on peace, democracy, or development, take the existing system as given and try to solve particular problems within the system. They act within the neoRealist framework which sees the international system as a given structure to affect actors' perceptions and behaviors. On the contrary, CTIR questions the structure itself by pointing out the social power relationships. Rather than problem-solving preoccupation with the maintenance of social power relationships, a critical theory of hegemony directs attention to questioning the prevailing order of the world.1 For BOP, states are the primary actors in the international system and therefore the unit of analysis of IR discipline. For CTIR, social forces, and classes whose organization networks go beyond the territorial boundaries of individual states are the main actors. The level of analysis for BOP is the interstate political relations. For being rooted in Marxist tradition, CTIR sees economic relations as the founding component of international relations. To clarify the terminology, Marxism is used here as an umbrella term -“as a family of approaches, rather than a single unified system, and has itself experienced recurrent crises, and repeated re-invention.”2 Being one of these re-inventions, CTIR does not subscribe to the classical Marxist conceptualization of the absolute prevalence of economics over politics. CTIR represents the 'cultural turn' in Marxism, from a mono-disciplinary critique of the political economy approach to inter-disciplinary (or, post1 A. Bieler & A. D. Morton, A critical theory route to hegemony, world order and historical change: neo-Gramscian perspectives in International Relations, Capital & Class, Spring 2004, p. 86. 2 Bob Jessop & Ngai-Ling Sum, Beyond the Regulation Approach: Putting Capitalist Economies in Their Place, Edward Elgar Publisher Ltd., UK, 2006, p.3.

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disciplinary, according to some interpretations) 'cultural political economy' which ascribes a discursive nature to power. As a neoMarxist theory, CTIR sees politics and economics in interaction, mutually determining each other through not only material conditions but also ideological tools. In other words, politics which is seen as being passively shaped by economics in orthodox Marxism not only legitimizes but also manipulates economics in CTIR. CTIR achieves this twist in the orthodoxy that it comes from by utilizing Gramsci's concept of hegemony. The most common definition of hegemony is domination of a superpower over relatively less powerful actors of the system. Defined as such, this hegemon is susceptible to the threat of being overthrown in any change in the balance of power.(3) Gramscian hegemony, however, is not merely a version of direct domination. The hegemon, which is a class, or another actor mainly representing the interest of a class, such as a social force, builds and consolidates its dominance not only through material force but also the consent of those subjected to its hegemony. [Hegemony] appears as an expression of broadly based consent, manifested in the acceptance of ideas and supported by material resources and institutions, which is initially established by social forces occupying a social role within a state, but it is then projected outwards on a world scale.4 The subjects give their consent to the hegemon because they believe that the order that the hegemon creates is the best option for them. Therefore, the ideological order is reproduced both by the hegemon and its subjects. There are three spheres of activity on which this reproduction takes place: social relations of production (“material, institutional and discursive forms that engender particular social forms”), forms of state (different forms of statecivil society relations), and world orders (phases of stability and conflict). Social relations of production give rise to certain social forces, these social forces constitute the basis of power in forms of state, and overall, this shapes world order.5 3 Bob Jessop & Ngai-Ling Sum, Beyond the Regulation Approach: Putting Capitalist Economies in Their Place, Edward Elgar Publisher Ltd., UK, 2006, p.4-5. 4 R. W. Cox, 'Social Forces, States and World Orders: Beyond International Relations Theory', Millennium: Journal of International Studies, 10(2), 1981, p. 139. 5　 A. Bieler & A. D. Morton, A critical theory route to hegemony, world order and historical change: neo-Gramscian perspectives in International Relations, Capital & Class, Spring 2004, p. 87-89.

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On the question of continuity and change of world orders, inheriting dialectics from classical Marxism, neo-Marxism envisages the end of this hegemonic order. The end comes as a result of a counter-hegemonic challenge by another actor or force, and a new order is established around this new hegemon. Cox, who formulates Gramscian hegemony into a critical theory of social sciences, notes that this dialectics includes “possibilities of change within the sphere of production and the exploitative character of social relations, not as unchanging ahistorical essences but as a continuing creation of new forms.6 In CTIR, this hegemonic ideological order is called transnational historic bloc. It is based on Gramsci's concept of a historic bloc: An historical bloc refers to the way in which leading social forces within a specific national context establish a relationship over contending social forces…. It indicates the integration of a variety of different class interests that are propagated throughout society.7 Dirlik points out two simultaneous and complementary processes in the construction of hegemony in Gramsci: integration, which renders the ideology of the hegemon as commonly shared symbols and ideas, and dissimulation, in which these commonly shared symbols and ideas conceal relationships of power and domination.8 CTIR theorist link this concept of hegemony within national boundaries to a transnational phenomenon asserting that dominant classes are initially transnational in nature but they have “nationalized” themselves historically throughout the formation of nation-state system.9 To prove their point, CTIR theorists apply 6　 R. W. Cox, 'Social Forces, States and World Orders: Beyond International Relations Theory', Millennium: Journal of International Studies, 10(2), 1981, p. 132. 7 A. Gramsci, Selections from the Prison Notebooks, London: Lawrence and Wishart, 1971, p.181-182 (as quoted inA. Bieler & A. D. Morton, A critical theory route to hegemony, world order and historical change: neo-Gramscian perspectives in International Relations, Capital & Class, Spring 2004, p. 90) 8 A. Dirlik, Anarchism in the Chinese Revolution, University of California Press. Berkeley and LA, CA, 1991, p.36. 9 A. Gramsci, Selections from the Prison Notebooks, London: Lawrence and Wishart, 1971 (as quoted in A. Bieler & A. D. Morton, A critical theory route to hegemony, world order and historical change: neo-Gramscian perspectives in International Relations, Capital & Class, Spring 2004, p. 93)

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the historical approach they inherit from Marxism, and refer to European history to find examples of historical blocs. The Roman Empire, the Catholic Church, and the British Empire were examples of historic blocs in the past. Our age is witnessing the hegemony of the US in the neo-liberal historic bloc. Note that, even though historic blocs are named after the hegemons of the blocs, the real domination is in the hands of social forces and classes. For instance, in our age, even though the US is leading the bloc, the real beneficiary of the order is the transnational class of managerial elite. In other words, the transnational managerial elite sets the rules of the game, i.e. global political (capitalist) economy; and the US provides the bloc with the tools of legitimacy, such as socialpolitical institutions and a culture of neo-liberalism. The notion of means of legitimacy explains another difference between BOP and CTIR, that is, the ways through which the power relations are established. For BOP, power is mostly material (military, economic, etc) and the power relations are more or less transparent, as in the case of nuclear deterrence. Subjectivity is allowed only up to the level of threat perceptions. Change happens when there is a sufficient alteration in the balance of power. On the contrary, power according to CTIR is diffused into the international society through cultures of the hegemonic ideology, i.e. a culture of education, the economy, media, literature, and so on. This kind of power prevails because it transforms the conceptions and creates consent and legitimacy. “ Reality” is not only the physical environment of human action but also the institutional, moral, and ideological context that shapes thoughts and actions.10 The counter-hegemonic challenge comes generally from a subversive class, or social force, and sometimes from a state representing such an alternative social force; and it cumulates until it consolidates the strength to shake the norms and the institutions of the hegemon to the point that the consent given loses its grounds. The criticisms of CTIR's conceptualization of hegemony tend to revolve around two points: one that it is not clear when the 10 R. W. Cox, 'Social Forces, States and World Orders: Beyond International Relations Theory', Millennium: Journal of International Studies, 10(2), 1981, p. 132. (Note that, CTIR has a constructivist approach to IR but it does not goes as far to post-Positivist realm)

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dominant power becomes a hegemon; and the other that it is not clear what is a counter-hegemonic challenge. In essence, these ambiguities reflect a major challenge that CTIR faces: combining and reconciling material explanation of Marxism with an ideational construction of the world in Gramscian or Foucaultian sense. [T]he real problem of early Coxian school is how a class-relevant project (for example neoliberalism) is assembled in 'material-discursive' space and how it is reproduced (not mechanistically) within the wider society…11 　　 That is to say, discursive approaches tend to create identities whose boundaries are narrowly-drawn; therefore, it is difficult to create a constructivist discourse with a unit of analysis as broad and totalistic as class. Hence, the challenge is how to resist the particularizing effect of post-Positivist discursive approaches without falling into the trap of class reductionism. In order to overcome this challenge, Jessop and Sum propose looking at the, “specific economies [within the totality of economic relations] to be seen as imaginatively narrated systems that are accorded specific boundaries, conditions of existence, typical economic agents, tendencies and countertendencies, and a distinctive overall dynamic”.12 This time, however, such a neat characterization of the hegemonic world order seems like a reaffirmation of it. An analysis of the recent literature would demonstrate that most of the critiques of the neo-liberal order conclude that there is no way to challenge it. As such, the notion of change, the basic premise of any Marxist theory, classical or reinvented, remains unaccomplished. The anarchist critique of neo-Marxism gives clues about why CTIR's account of hegemony appears to be affirmative. Dirlik claims that Gramsci is not against the notion of hegemony per se; he takes issue with a particular kind of hegemony, i.e. hegemony of the capitalist class in Western societies. Otherwise, he would not see any problem with the hegemony of proletariat.13 What we can infer 11　 Bob Jessop & Ngai-Ling Sum, Beyond the Regulation Approach: Putting Capitalist Economies in Their Place, Edward Elgar Publisher Ltd., UK, 2006, p.7. 12 Ibid., p.8. 13 A. Dirlik, Anarchism in the Chinese Revolution, University of California Press. Berkeley and LA, CA, 1991, p.37.

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from this statement is that CTIR, like as Marxism, is totalistic in the sense that it offers a closed and coherent framework to explain the international system. In this sense, CTIR, which is informed by the discourse analysis of the post-Positivist theories, is different from those which oppose the very idea of an organizing engine at all. By the same token, it comes close to neo-liberalism which is also primarily an ideology. Therefore, CTIR is an important analytical tool to understand the nature of capitalism, especially in times of crisis, such as in the post-Fordian era, or in neo-liberal globalization of our day. Overall, CTIR offers students of political science a coherent (systematic) whole to explain the developments in the world. It provides us with the ways to approach an issue. With every new development, CTIR asks a set of questions, varying from “who benefits from this development beyond state borders?”, “is it within the rules of the game?”, to “is it legitimized ideologically? How?” How does CTIR see US-led neo-Liberal bloc and China's Role in it? The foundations of today's neo-liberal order were established during the Cold War days. In order to win the ideological struggle both the capitalist West camp and the socialist East camp promoted their values through a number of political, economic and cultural institutions. By the end of Cold War, the ideas and norms of the West camp prevailed over those of the East camp. The political/ideological unipolarity of the immediate postCold War years, combined with the uniformity of economic principles gradually consolidating since the 1980s, has brought about the forces of globalization. Globalization means the expansion of the neo-liberal historic bloc to a global scale. A historic bloc maintains consent not only through economic policies but through cultural and social institutions as well. Neo-liberalism's economic premises are free flow of capital, goods, and services, the least regulation possible, conformity with the international economic regimes to be guaranteed by the international political and economic organizations; political institutions being the UN, NATO, regional integration organizations such as NAFTA, APEC 207

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and the economic organizations such as IMF, World Bank and WTO. The cultural premises are individuality, commodification, globalization, free flow of people, cosmopolitanism, nonregulation, universal morality of human rights, consumerism, and liberal freedom, such as freedom of press and freedom of religion. China has decided to be a part of the neo-liberal bloc in the late 1970s. Deng's Open Door Policy marked the breaking up with Mao-era self-reliance policy and the engagement into global capitalism. Since market economy comes with its package of cultural values and institutions, China has had to turn its face to the West socially as well. Some values, such as consumerism and free flow of people have resonated well and easily in China whereas some others, such as universal human rights and liberal freedoms have not found a niche for themselves yet. Aiming at rapid growth, China has taken the US as its role model. Given the hierarchically superior position of the US as the hegemon in the neo-liberal world order, the relationship between the US and China is one of aggressor-and-defender.14 Chances are the stronger China gets, the lesser it would be dependent on the US. Nonetheless, it is the ruling elite consolidating their interests but not a country as a whole fulfilling so-called national interests during the process of integration a country into a historic bloc. Therefore, by the time China gets fully integrated into the neo-liberal bloc, the ruling elite would already be fully embedded in the system so that they would not pursue national policies that would threaten the future of the bloc. To sum up, CTIR sees the US not only as a super power which happens to be the strongest currently, but as the hegemon of the neo-liberal historic bloc. In order to understand China's positioning towards the hegemon, i.e. whether or not it constitutes a counterhegemonic challenge, following questions should: Does China challenge the “rules of the game”, i.e. neo-liberal premises both economically and culturally? Does China represent a discontented social force? Specifically, can we talk about such a coherent whole of a “discontented social force”? If yes, is China willing to take this role of representation? 14 P. Van Ness, P, Hegemony, not anarchy: why China and Japan are not balancing US unipolar power, Technical Report Working papers, RSPAS, ANU, 2001, p.13.

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Analyzing Sino-African relations is revealing since China demonstrates its intentions and conceptions in its policies and actions in this region. 2. Africa in Chinese Foreign Policy China's African policy has been through three periods since its establishment in 1949. They are (1) Ideological (1950s-1980s), (2) Post-ideological (1980s-2000s), and (3) New Engagement (2000spresent). The first period is between the establishment of the People's Republic to the opening up in 1980s. In this period China was actively involved in African politics, both domestic and international. There were two main incentives for such an active involvement: one was seeking support from Third World countries in the ideological struggle during Cold War, and the second was seeking support in its struggle against Taiwan for international recognition as the Chinese state. To start with the first incentive, China's struggle during the Cold War was ideological in two dimensions. In one dimension, being a communist state, it waged an ideological war against the US and the capitalist ideology that the US represented; in another dimension, it had to be on guards against the USSR because even though PRC and USSR shared the same ideology, USSR continuously desired to the expand its realm of influence, if not its territory, at the expense of Chinese national independence. Overwhelmed with the pressures from both the West camp (First World) and the East camp (Second World), China decided to ally with the Non-Alignment Movement.15 Even though NonAlignment Movement did not last very long, the term Third World has gain a particular political salience because the common factors that had brought these countries together at the first place, such as being less developed than the First and Second Worlds, therefore the feeling of being left out, has persisted. Even today, the foreign 15 The countries in this non-aligned bloc, such as Yugoslavia, India, and African countries, were those that were not in the geographic or ideological realm of influence of either the West camp or the East Camp that is they belong to neither the First World nor the Second World. Constituting the “Third World” These countries got together in Bandung Conference in 1955 and decided to organize as a third, non-aligned force.

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policies of many ex-Third World countries, including China, are still shaped by this “Third World mentality” with an emphasis on anti-imperialism, in all of its forms, old and new. The words of Lin Biao, the vice-premier of the time, clearly demonstrate the fact that China perceived the Third World as the space in which it could maximize its political and ideological interests: Since World War II, the proletarian revolutionary movement has for various reasons been temporarily held back in North America and West European capitalist countries, while the people's revolutionary movement in Asia, Africa and Latin America has been growing vigorously.... In the final analysis, the whole cause of world revolution hinges on the revolutionary struggles of the Asian, African and Latin American people who make up the overwhelming majority of the world's population. The socialist countries should regard it as their international duty to support the people's revolutionary struggles in Asia, Africa and Latin America.16 Lin Biao's words reveal that the ideological division in Chinese minds is not exactly between capitalist and socialist models of economy but between the developed and underdeveloped countries. As a matter of fact, the Chinese “theory of the three worlds”17 was not exactly the same with the one of Non-Alignment Movement. Chinese version of the three worlds was divided as such: The First World: US and the SU, the Second World: Canada, Europe, Japan, and Oceania; and, the Third World: the developing countries of Africa, Asia, and Latin America. China placed itself in the Third World.18 Such conceptions provided China with an easy transition the rhetoric of South-to-South solidarity in the third period of its relations with the African continent. As for the recognition issue, as a result of the civil war between the Nationalists and the Communists in China in 1930s and 1940s, two Chinese states were established in 1949, the communist one in mainland China, the Nationalist one in Taiwan island. Since then, both states claim the right of sole representation of the Chinese 16　 Lin, www.marxist.org, 1965. 17　“ Theory of the Three Worlds” was presented by Deng Xiaoping to the United Nations in 1974. 18 G. Yu, Africa in Chinese Foreign Policy, Asian Survey, Vol.28, No.28, 1988, p.854.

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state. During the early years of Cold War, Western camp recognized Taiwan as the sovereign Chinese state, and the Eastern camp recognized PRC, both on idelogical terms. Consequently, the decision on the international recognition was in the hands of the Third World countries. Therefore, both PRC and ROC (Taiwan) worked hard to gain individual African countries to their sides. Having these two motives, China during 1960s and 1970s was actively involved in African affairs. This involvement was generally in the form of support for decolonization movement, direct aid, mutual agreements on the issues such as education, or formulation of common foreign policies in international organizations. Premier Zhou Enlai formulated the general principles governing China's African policy: (1) revolutionary struggle, (2) mutual political support (referring to recognition), and last but not the least (3) Third World unity (stress on anti-imperialism).19 China built a substantial amount of the infrastructure of individual African countries as well as the continent in accordance with the “eight Principles of Economic and Technical Aid” of 1964. The most prominent example is the construction of Tanzania-Zambia Railway. Besides this sort of direct aid, China has been training the technocrats of several African countries.20 The second period was between the opening up in the 1980s to 2000s. This period is characterized by the loose, unsystematic bilateral ties between China and the individual African countries. There are two reasons for the loosened ties between China and Africa in this period. The first one is international and the second one is domestic. Internationally, in this period, the ideological concerns of the first period disappeared. That is why it is appropriate to call it post-ideological. This ideological change after the US recognized PRC as the sovereign Chinese state. Given to the role and strength of the US in the international system, the recognition issue is de facto solved in the advantage of PRC. Such 19 Ibid., p.852. 20　 G. Yu, Africa in Chinese Foreign Policy, Asian Survey, Vol.28, No.28, 1988. & I. Taylor, China's Foreign Policy towards Africa in the 1990s, The Journal of Modern African Studies, Vol. 36, No.3, 1998.

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Sino-Americanrapprochement and the fact that China does not pursue a socialist economy anymore eased the Cold War ideological tensions. The domestic reason for loosened ties between China and Africa is not ideological. It is about China's changing policy priorities. That is, the 1980s and 1990s were decades that China turned inwards in order to achieve quick catch-up with the developed world, and eventually almost withdrew from the international politics. It was the implicit state policy of Four Modernizations, initiated by the premier of the time, Deng Xiaoping, to disengage from an active foreign policy in order to focus on domestic politics.21 Nonetheless, even if China decided to engage in an assertive foreign policy, there was virtually no consensus on how this certain foreign policy might look like. Open Doors policy was a strategy developed to avoid the after-effects of dissolution of the East camp. Even though China also had to go through a power transition from the old to the new elite, the domestic implications of such a 'quick fix-up' strategy were more or less envisioned. However, how to extend this mainly economic policy to other realms of foreign policy was much less clear given the fact that the post-Cold War international system was also in an indeterminate state itself. The neo-liberal historic bloc, which now did not have a counterhegemonic challenge coming from the socialist East Camp, was restructuring itself as a fully-globalized bloc, and meanwhile, reformulating its ideology and discourses accordingly. In such an ambiguity, China pursued a 'wait-and-see' policy. The second period if China's African policy was a consequence of such an uncertainty. Specifically, the declaration of “Five Principles of Peaceful Coexistence”, which was originally a treaty signed with India in 1954, accurately reflects, and still serves to demonstrate this disengagement policy. These five principles are mutual respect for each other's territorial integrity and sovereignty, mutual nonaggression, mutual non-interference in each other's internal affairs, equality and mutual benefit, and peaceful co-existence. 21 G. Yu, Africa in Chinese Foreign Policy, Asian Survey, Vol.28, No.28, 1988 & D.J. Muekalia, Africa and China's Strategic Partnership, www.sarpn.ac.za, 2004.

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Prior to the third period of Sino-African relations, there were two developments which later on shaped China's current position towards Africa. One is the consolidation of neo-liberal historic bloc, as a result of a process described above. Another is the consolidation of the power of the new elite in China which enabled the state to assert both domestic and foreign policies more confidently. Consequently, in the third period, China engages into African affairs assertively to claim a place in the historic bloc of the day. In terms of assertiveness, the first and the third periods of China's African policy show similarities. For instance, high-level official visits were reintroduced22 and the policy of developmental aid that “did not enrich elites” is still pursued.(23) Nonetheless, there is a major difference in the nature of China's active involvement in these two periods: the first period was marked with ideologicallyoriented developmental assistance whereas the third period is primarily profit-oriented. Jiang Zemin, the premier of the time, introduced the new aid policy of Chinas as such: Under the new regime, the old no-interest lending was replaced by China –subsidized preferential loans conditional on the Chinese being party to economically feasible Africa-based enterprises.24 China is the third largest trade partner with Africa, after the US and France today and according to estimations it may become one of the top three FDI providers in the coming five years.25 It also stands out among the investor states for investing in “risky countries to invest” as well.26 Above all, China is in need of considerable amounts of oil supply for its rapidly growing industries and this constitutes a major clash of interest among great powers. Therefore, in order to decrease rivalry on oil supply and avoid direct confrontation, China aims at African oil sources which are much less politicized than the Middle Eastern and Central Asian oil sources today. As put in a CSIS paper: 22 D. J. Muekalia, Africa and China's Strategic Partnership, www.sarpn.ac.za, 2004, p.7. 23 B. V. Sautman, Friends and Interests: China's Distinctive Links with Africa, Center on China's Transnational Relations, Working Paper 12, University of Honk Kong, 2005. 24 Jiang, 2006. 25　 People's Daily, http://english.people.com.cn, 2006; UNCTAD, www.unctad.org, 2005 26　 J. Kurlantzick, Beijing's Safari: China's Move into Africa and Its Implications for Aid, Development, and Governance, Policy Outlook No. 29, 2006, p.3.

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After remaining dormant for thirty years, China's contemporary engagement in Africa reflects the emergence of a new and ambitious vision. Whereas Beijing was not long ago content to compete with Taipei for African states' diplomatic recognition, today, energy, trade and, increasingly, geopolitical interests figure prominently in the agenda China actively pursues in Africa.27 While China's primary aim is economic advantage, it continues its aid programs to Africa. These aid programs help strengthen China's positive image in Africa because, unlike the Western and international aid packages, China's aid is not monetary but in the form of infrastructure.28 Therefore, aid does not trigger corruption and it has direct effects on the lives of Africans. Besides, China transfers technology and trains personnel. China's education policy follows its overall policy of economic engagement without political patronage. That is, unlike the African students mostly being trained in administrative skills in the US, China trains African students in science and economics.29 In other words, the US trains the bureaucrats of Africa whereas China trains the technocrats. Relatedly, China still pursues its non-intervention principle and does not exert direct conditionality to the recipients of its aid packages who are its trade partners at the same time. Regardless of its affirmative aid policy, China does not give up its own economic policies for the sake of African development in the third period. China's strategy of mass export of cheap textile and manufactured good (mainly electronics) severely shakes Africa's light manufacturing industry (which is the continent's most important economic source) and therefore causes uneasiness towards China. Nevertheless, as a response, China signed an agreement with South Africa, which is the largest reading partner in the continent, to limit the Chinese exports.30 27 CSIS Prospectus, Opening a Sino-US dialogue on Africa, www.csis.org/pubs/prospectus, 2003. 28　 G. Yu, Africa in Chinese Foreign Policy, Asian Survey, Vol.28, No.28, 1988. 29　 J. Kurlantzick, Beijing's Safari: China's Move into Africa and Its Implications for Aid, Development, and Governance, Policy Outlook No. 29, 2006, p.3. 30 J. Kurlantzick, Beijing's Safari: China's Move into Africa and Its Implications for Aid, Development, and Governance, Policy Outlook No. 29, 2006, p.3-4.

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After a decade of “groping for stones to cross the river”31 in the 1990s, China decided that it was ready to initiate regional relations in African continent beyond bilateral relations. In 2000, China organized the first Sino-African Summit, which was to be repeated in 2003 and 2006 as well. The last 2006 Summit was the one which received the most attraction in terms of its reach and the potential consequences. More than 40 African heads of state and government representatives attending the Summit, several bilateral and multilateral deals for both aid and infrastructure projects were signed.32 As a result of these two dimensions of China's African policy, namely pro-development measures and profit-oriented economic policies, there are two competing perceptions about China in Africa: One is, perceiving China as a power alternative to the Western powers, the other one is seeing it as another imperial power exploiting the African continent. Those who differentiate China from the Western powers make this distinction in terms of both its intentions (global South solidarity) and methods (anti-corruption aids and case-specific development strategies). For many Africans, there is a “Chinese model”, not just of FDI/export-led rapid industrial expansion, but of a developing state that does not fully implement WC policies. China is seen as more willing that the West to help develop the predicates of industrialism in the global South and to do so far a lower cost to the continent, without imposing what many find to be onerous requirements for African states' policies.33 Whi, a South African scholar, supports this view by revealing the way that China is perceived in Africa: China is the first country from the so-called marginalized developing fold to occupy centre stage in the global political economy. In terms of political ideology and 31 Deng's words describing China's opening up and modernization. 32　 A. Last, Forum on China-Africa Cooperation Summit, www.standardbank.co.za, 2006. 33 B. V. Sautman, Friends and Interests: China's Distinctive Links with Africa, Center on China's Transnational Relations, Working Paper 12, University of Honk Kong, 2005, p.14.

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approaches to socio-economic development, China is closely aligned to countries of the south. This has, for many years, shaped China's relations with countries in Africa and elsewhere and created a somewhat idealistic impression of the distant partner or a big brother in the East that is still evident on the continent today.34 Those who see China as another exploitative actor in the continent reach their conclusions by looking at consequences. They conceive conceiving China as an imperial power among many which try to exploit African sources.35 Sautman calls it informal empire where “a central authority determines a periphery's external policies and influences its domestic matters.36 Overall, no matter how sugar-covered with aid packages and non-intervention principle, China pursues explicitly neo-liberal policies in Africa. When one looks beyond the differences in national policies, there is a managerial elite class that benefits from current political and economic predicament in Africa under all conditions. Chinese elite is becoming a part of this class. Conclusion China does not constitute a counter-hegemonic challenge to the neo-liberal historic bloc. Nonetheless, there are reasons that create the misconception that China is such a counter-hegemonic power. They are (a) ideological illusion; (b) some of Chinese actions which are not in conformity with the norms of the neoliberal historic bloc. The following part will explain why these facts do not constitute a counter-hegemonic challenge. To conclude, this paper argues that the misconceptions are because of the differences between the Western and Chinese conceptions of the bloc. As for the ideological illusion, some scholars argue that the repetitive emphasis on anti-imperialism (anti-hegemonism, literally) in the official documents of China along with the recent bilateral agreements between China and African countries demonstrates a new turn not only in Sino-African relations but 34　 L. Whi, A Match Made in Beijing, Mail & Guardian, Johannesburg, 2006. 35 L. Polgreen, Chinese Take a Turn at Turning a Sub-Saharan Profit, New York Times, 2006/08/18. 36 B. V. Sautman, Friends and Interests: China's Distinctive Links with Africa, Center on China's Transnational Relations, Working Paper 12, University of Honk Kong, 2005, p.13.

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also in China's international role.(37) However, the emphasis on antiimperialism in these documents (which originally refers back to 1954 paper of Five Principles of Peaceful Coexistence) does not mean a specific policy-orientation beyond a repetition of the ideological discourse of the 1960s. Legally, China is still a socialist state, and this kind of revolutionary language is common in all of the official documents. Nonetheless, with an alternative reading, these documents would reveal the real policy orientations as well. The principles to be highlighted in the Five Principles of Peaceful Coexistence paper in order to understand China's attitude back then are principle of non-intervention and non-aggression. The first principle reflects China's concern that the intervention of the international society into its internal affairs might hinder the quick pace of its development. The second principle reflects China's unwillingness to get involved in any direct power struggle in the international arena. It is partly linked to China's concern about -again- its ongoing economic development, and partly to the concern about rising aggressive nationalism as a reflection of social unrest. Muekalia, a South African scholar seconds the point that China today is pursuing a non-involvement policy: In 1980 China joined the World Bank and the International Monetary Fund (IMF) and it was well on the way to economic recovery. More foreign investment was coming in; technical assistance and foreign loans were multiplying. As it strove to steer its economic development, China's foreign policy stressed the development of friendly relations with other nations without regard to their social systems or ideological orientation. The Five Principles of Peaceful Co-existence were reiterated as the basis for its foreign relations. China had gradually changed its tactics from confrontation to co-operation, from revolution to economic development, and from isolation to international engagement. 38 There is a sharp difference between these two perceptions, one perceiving China as anti-hegemonic, the other perceiving it as noninvolving. It seems that such a sharp difference in conceptions is 37 G. Yu, Africa in Chinese Foreign Policy, Asian Survey, Vol.28, No.28, 1988, p.854-856. 38 D. J. Muekalia, Africa and China's Strategic Partnership, www.sarpn.ac.za, 2004, p.7.

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related to the backgrounds of the scholars who look at the world from the point of view of where they are based. The scholars who conceive Five Principles as anti-hegemonic are the US-based and probably heavily exposed to “China threat” rhetoric are different from the Chinese scholars who are exposed to “China as a nonaggressive civilization” rhetoric in the Mainland and the African scholars who conceive the world through a center-periphery conceptualization. The perceived unconformity of China with the neo-liberal historic bloc is a result of the state's attempts to get a better position in the system. Certain actions motivated with such an attempt might constitute a challenge to the hegemon of the bloc, since after the consolidation of the historic bloc, the hegemon becomes an actor among many (meaning primus inter pares, not one among equals). Even so, China means to play the game by its rules, and its deviations from the formal rules of the bloc is not a counterhegemonic challenge but one of two things: either a flexibility that other -seemingly more collaborating- members of the bloc also enjoy, or a cultural/institutional modification of the game which is inevitable when the historical bloc spreads across geographically and historically different spaces. The first kind of deviation can be explained with several examples. Take observing human rights as one of the major norms of the neo-liberal historic bloc. China is severely criticized for not paying proper attention to the human rights violations in countries such as Sudan for the sake of economic gains, and this is presented as an attempt to alter the norms of the bloc altogether. However, China does not deviate from the norms and rules more than the other influential members do. For example, China's nonintervention principle in its African policy is comparable to the US support for oil producing Middle Eastern dictatorships, or the EU's decision in 2003 to lift the embargoes against China which was introduced after the human rights violations during Tiananmen Square Incident in 1989 without any significant improvement in China's human rights predicament. Both policy actions were to serve the US's and the EU's economic interests. In Africa in particular, not only China but also the EU purchases large amounts 218

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of illegal timber from Africa to use in pharmacology and this is regarded as bio-piracy according to international agreements.39 China follows the path of the US when it signs bilateral agreements with individual African countries going beyond WTO principles. 40 The second point is not as easy to explain as the first one because necessitates not only examples but also a clarification of the terms. There is a line of thought among China specialists that China does constitute a counter-hegemonic challenge since it represents a communal version of capitalism in contrast to individualistic interpretation of neo-liberalism. Pointing out the contradiction between the individualistic and communalistic conceptions of the ideology is a sound analysis; however, whether it qualifies to a counter-hegemonic challenge is another question. As described in the theoretical framework, the historic bloc consolidates its hegemony through an ideology. Neo-liberalism, capitalism, socialism, modernity are examples of ideology. However, the crucial question for analytical purposes is whether these ideologies should be taken as strictly-defined doctrines or contextually-defined processes. We now know that many ideologies have taken different forms in different cultural, geographical and historical contexts, but when a concept is taken as a process, it is still possible to talk about the persistence and applicability of the ideology. For example, modernity is able to fulfill all of its premises, such as secularization or individuality only in Western Europe, its would suffice here: the transition literature now focuses on the varieties of capitalism. In each example, the variations (or, deviations from the origin) do not disqualify these alternate ideologies. For our discussion, Chinese communal neo-liberalism still falls into neo-liberal historic bloc. It is “neo-liberalism with Chinese characteristics”.41 Neo-liberalism with Chinese characteristics is best symbolized with Beijing Consensus (BC), named after, and in opposition to Washington Consensus, which brought about the final touch of the US-led neo-liberal historic bloc. Not confronting the basic premises of neo-liberalism, BC quests for a different, 39 www.illegal-logging.info, 2005. 40 B. V. Sautman, Friends and Interests: China's Distinctive Links with Africa, Center on China's Transnational Relations, Working Paper 12, University of Honk Kong, 2005, p.4. 41 D. Harvey, A Brief History of Neoliberalism, Oxford University Press, Oxford, 2005.

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more equitable distribution of wealth and power, in which China and other non-Western powers can have a say.42 It opposes the hierarch of nations embodied in WC-related institutions such as the IMF, World Bank and WTO.43 BC [is] an “ideology” within neo-liberal parameters that nevertheless takes seriously some aspirations of developing states often ignored or opposed by the West.44 Instead of prescribing one single way to achieve development for all of the members of the system (which is currently engaging into birthplace. It is commonly observed that modernity has not brought secularization to some other places in the world (Weller). Another example is that, democracy comes with liberal constitutionalism perhaps only in continental Europe and AngloAmerican world whereas it is still possible to talk about democracy, albeit illiberal, in many other places in the world (Zakaria). A final example international monetary and economic regimes), China acknowledges the peculiarities of individual countries and therefore it proposes that there should be different development strategies. Dirlik sees such approach as the strong point of BC: BC's key aspect may be its acknowledgement of the desirability of a global order founded, not upon homogenizing universalisms that inevitably lead to hegemonism, but on as simultaneous recognition of commonality and difference.45 　　 China's emphasis on peculiarities of individual cases takes attention of other scholars as well. Ramo describes China's stance in the international arena as “a multi-faceted policy set that forefronts constant innovation as a development strategy (instead of one-sizefits-all neo-liberal orthodoxy) and uses quality-of-life measures, 42 B. V. Sautman, Friends and Interests: China's Distinctive Links with Africa, Center on China's Transnational Relations, Working Paper 12, University of Honk Kong, 2005, p.4. 43 J. C. Ramo, The Beijing Consensus: Notes on the New Physics of Chinese Power, Foreign Policy Center, London, 2004, p.11-12. 44 B. V. Sautman, Friends and Interests: China's Distinctive Links with Africa, Center on China's Transnational Relations, Working Paper 12, University of Honk Kong, 2005, p.6. 45 A. Dirlik, Beijing Consensus: Beijing “Gongshi”: Who Recognizes Whom and to What End,　 www.globalautonomy.ca, 2006.

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such as equality and environmental (not just GDP) in formulating the strategy.46 Building on Ramo's point, Sautman sees BC as an expression of China's “soft power” effort.47 Therefore, China's “ideological” struggle is between an “Anglo-Saxon credo” and an Asian-derived “socially oriented” model of neo-liberalism, but within neo-liberalism. Roden explains it with China's commitment to the 'project of modernity': China is umbilically linked to the US [regarding modernity] and, quite unlike counter-hegemonic forces within radical Islam, seeks to emulate US modernity - not replace it. Thus, any analysis of state competition that ignores the appeal of US ideas - namely consumerism and concomitant liberal freedom-is quintessentially reductionist.48 To conclude, China is not a counter-hegemonic power of the neo-liberal historic bloc but a consenting actor which conceives the ideology of the bloc in its own way.

46 J. C. Ramo, The Beijing Consensus: Notes on the New Physics of Chinese Power, Foreign Policy Center, London, 2004, p.11-12. 47 B. V. Sautman, Friends and Interests: China's Distinctive Links with Africa, Center on China's TransnationalRelations, Working Paper 12, University of Honk Kong, 2005, p.6. 48　 M. Roden, US–China Relations in the Contemporary Era: An International Political Economy Perspective, Politics, Vol. 23, 2003, p.198.

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Bibliography Breslin, S., IR, Area Studies and IPE: Rethinking the Study of China's International Relations, CSGR Working Paper No. 94/02, University of Warwick, 2002. Bieler, A., & Morton, A.D., A critical theory route to hegemony, world order and historical change: neo-Gramscian perspectives in International Relations, Capital & Class, Spring 2004 Chase-Dunn, C. et. al., Hegemony and Social Change, Mershon International Studies Review, Vol. 38, No. 2 (Oct., 1994). Chen,Q., New Approaches in China's Foreign Policy: The Post-Cold War Era, Asian Survey 33:3, March 1993:237-251. Cox, R. W., 'Social Forces, States and World Orders: Beyond International Relations Theory', Millennium: Journal of International Studies, 10(2), 1981. Cox, R. W. (1983) 'Gramsci, Hegemony and International Relations: An Essay in Method', Millennium: Journal of International Studies, 12(2): 162-75. CSIS Prospectus, Opening a Sino-US dialogue on Africa, www.csis.org/pubs/prospectus, 2003. Dirlik, A., Anarchism in the Chinese Revolution, University of California Press. Berkeley and LA, CA, 1991. Dirlik, A., Beijing Consensus: Beijing “Gongshi”: Who Recognizes Whom and to What End, www.globalautonomy.ca, 2006 Gill, S.R. & Law, D., Global Hegemony and the Structural Power of Capital, International Studies Quarterly, Vol. 33, No. 4, 1989. Gramsci, A., Selections from the Prison Notebooks,. London: Lawrence and Wishart, 1971. 222

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Harvey, D., A Brief History of Neoliberalism, Oxford Univetrsity PRess, Oxford, 2005. Kuhling, C. & Worth, O., Counter-hegemony, antiglobalisation and culture in International Political Economy, Capital & Class, 2004. Kurlantzick, J., Beijing's Safari: China's Move into Africa and Its Implications for Aid, Development, and Governance, Policy Outlook No. 29, 2006. Last, A., Forum on China-Africa Cooperation Summit, www.standardbank.co.za, 2006. Lyman, P.N., China's Rising Role in Africa (Presentation to the US-China Commission), http://www.cfr.org/publication/ 8436, 2005. Mepham, D. & Wild, L., The New Sinosphere: China in Africa, Institute for Public Policy Research, www.ippr.org.uk, 2006. Ministry of Foreign Affairs of PRC, China's Africa Policy, www.china.org.cn, 2006. Muekalia, D.J., Africa and China's Strategic Partnership, www.sarpn.ac.za, 2004. Polgreen, L., Chinese Take a Turn at Turning a Sub-Saharan Profit, New York Times, 2006/08/18. Ramo, J.C., The Beijing Consensus: Notes on the New Physics of Chinese Power, Foreign Policy Center, London, 2004. Roden, M., US–China Relations in the Contemporary Era: An International Political Economy Perspective, Politics, Vol. 23, 2003. Safo, A., China's New Scramble for Africa, It is a Fact of Life, Says President Kufuor, www.allafrica.com. 2006. Sautman, B.V., Friends and Interests: China's Distinctive Links with Africa, Center on China's Transnational Relations, Working Paper 12, University of Honk Kong, 2005. 223

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Scherrer, C., Double Hegemony? State and Class in American Foreign Economic Policymaking, Amerikastudieen Vol.46, 2001. Taylor, I., China's Foreign Policy towards Africa in the 1990s, The Journal of Modern African Studies, Vol. 36, No.3, 1998. Van Ness, P., Hegemony, not anarchy: why China and Japan are not balancing US unipolar power, Technical Report Working papers, RSPAS, ANU, 2001. Yu, G., Africa in Chinese Foreign Policy, Asian Survey, Vol.28, No.28, 1988. Whi, L., A Match Made in Beijing, Mail & Guardian, Johannesburg, 2006. Zhang, Y., The 'English school' in China: a story of how ideas travel and are transplanted, Technical Report Working papers 2000/4, Department of International Relations, RSPAS, ANU, 2004. www.unctad.org www.illegal-logging.info www.people.com.cn www.standardbank.org www.marxist.org

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Turkey-China Economic Relations Commercial relations between Turkey and the People's Republic of China began with a trading pact signed in 1976. Economic interactions in fact trace back to the history of the two nations in the Central Asia since there have been Turkish states along the historical Silk Road which starts in China. At those times, Turkish states had cooperated with their neighbors in order to secure the international trade. The free trade agreement between Asian Hun Empire and China were establishing the market places inside the Chinese territory.1 This agreement appears as one of those collaborations former Turkish states forged with the Chinese. Commercial relations were dominated by a number of fundamental products. Horses grew and trained by Turks were the foremost objects of the trade with Chinese due to their needs in army. There was another commercial agreement signed by Chinese emperor Kao-tsu and Mete Khan in between BC 206-AD 220 during which period the Han dynasty ruled in China. The agreement included articles demanding Chinese provide Turks with various foodstuffs and silk and leave an amount of territory to the Huns. Since it was the first international treaty accorded by two big states with equal conditions in the eastern Asia and required renewal of subsequent rulers, the agreement is of great importance.2 It is known that Bilge Khan too concluded a free trade agreement with the Chinese. Beyond the ancient origins of bilateral affairs, the TurcoChinese relations at the time of Gokturks also represented a cultural bridge between China and Iran as cited in some sources.3 Turks had critical roles to transport the commodities produced in China namely ceramic and silk to the West. The carrying trade could be realized through the territories of Turks because both China and Iran had been their bordering neighbors. In the period of T'ang dynasty that reigned from 618 to 906, trading caravans from the West and the Central Asia almost flooded into China. A large 1 Ozer Sukan, The People's Republic of China: History-Establishment-Development, Its Relations with Turkey and Other States [in Turkish], Harp Akademileri Basimevi, Istanbul, 2000, p.146-147. 2 Wolfram Eberhard, A History of China [in Turkish], Turk Tarih Kurumu Basimevi, Third Edition, Ankara, 1995, p.89. 3 Hans Wilhem Haussing, Silk Road and A Cultural History of the Central Asia [in Turkish], Translator: Mujdat Kayayerli, Gecit Yayinevi, Kayseri, 1997, p.213.

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quantity of luxury products which changed hands during this time were used by Gokturks as the medium of exchange alongside money.4 1.Development of Turkey-China Commercial Relations Turco-Chinese relationships bases of which traced to the Central Asia are continuing between two states, the People's Republic of China and Turkey in the beginning of 21st century. After closing its embassy in Shanghai in 1949, Turkey recognized the People's Republic of China on the 5th of August, 1971 by appointing an ambassador to Beijing. From that day forward Ankara ceased contacts with Taiwan and has pursued the policy of “one China”. Cultural and commercial relations with Taiwan are operated informally via two bureaus of this country in Istanbul and Ankara. Although it is one of 23 states that signed General Agreement on Tariffs and Trade (GATT) in 1948, China remained outside the system of multilateral trade after the 1949 Revolution. In 1986, Beijing applied the GATT Secretariat to regain the status of contracting party and a study group was formed within the WTO to evaluate the application. Following the meeting of the study group in September the 17th, 2001, China about fifteen years later joined the WTO on the 11st of December in 2001. Since 1st of January, 2005 China has been one of the important issues of the agenda in Turkey due to the removal of the quotas levied upon textile within the framework of WTO decisions. Particularly, Turkey's initiative together with 25 countries including the US to extend the transition process of abolishing textile quotas till 2008 had negatively affected the Ankara-Beijing relationship. The foundations of trade relations between Turkey and China base upon the treaties figured in the following table. 4 Sukan, p. 151.

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Table 1: Legal Foundations of China-Turkey Commercial Relations

Despite the considerable increase in Ankara's commercial relations with Beijing in recent years, bilateral trade has been developing to the disadvantage of Turkey. With the reduction of import tariffs below 10% in average and removal of export quotas, China emerged as a critical threat for Turkey. The next table displays the share of Turkey's export to and of import from China in its foreign trade. Table 2: Turkey-China Foreign Trade Data (1.000 USD)

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People's Republic of China appears the 3rd major importing partner of Ankara while it is ranked only the 20th among the countries Turkey exports most of its products. According to the foreign trade data of 2009, export to China amounted to $1.599.245.000 and import from this country reached $12.676.573.000.

In 2009, Turkey's foreign deficit in its trade with China remained $11.077.328.000. The deficit demonstrates that the economic relations between Turkey and the People's Republic of China still proceeds in a single acting pattern. 229

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Table 4: Turkey's export to China for the first ten products ($)

Turkey's export to China is mainly comprised of metallic ores, plastering materials, inorganic chemicals, machinery, mechanical appliances, and various equipments. Also defined as the biggest outdoor building site in the world, China in order for its economic activities to proceed will continue to purchase products necessary for the construction sector. In this respect, ceramic and glass products as well as plastic construction materials can be included in the items capable of increasing Turkey's trade volume with China. Among the foodstuffs, white meat, dried fruit, and tobacco appear the products with high export potentials.5 Alongside electrical machinery and equipments there are boilers, non knitted and crocheted tools and plastic materials on the list of the major imported materials. Turkey's import from the People's Republic of China in the first ten products according to data of 2009 is figured in the following table. Table 5: Turkey's import from China for the first ten products ($)

5 http://www.turkey.org.cn/en/index.html

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In October, 2010 Chinese Prime Minister Wen Jiabao paid a visit to Turkey and two countries signed eight deals in the areas of transportation and trade. The deals included a framework agreement for expanding further the trade and economic cooperation between two countries and five memorandums of understanding for certain steps to this end. With the visit of the Chinese Prime Minister, Turkey and the People's Republic of China agreed to use their own currencies, Turkish lira and yuan instead of dollar in bilateral trade. Furthermore, the leaders of the two states began to describe their relationship as “strategic partnership” and determined to work together in the fight against terrorism and cooperate on nuclear energy production. Through the deals, Turkey and the PRC will also take steps to secure their collaboration on transport and maritime affairs and to build railway infrastructure in Turkey. 2. Factors Affecting The Bilateral Trade The major factor influencing the trade between Ankara and Beijing is the export-oriented structure of China's production system. The range of products created by this structure can be classified into three groups. The first group includes highly competitive and labor intensive products which are more likely to be developed and thus features the most advantageous part of the Chinese industry. This group contains the products of textile, ready wear, leather, fur, plastic, metal, motorbike, electric machines and devices. The second group is mainly composed of the products with high potentiality of competitive advantage in the medium and long terms despite their lack of competitiveness in the current period. In this group the products are mainly in the areas of foodstuff and beverage, tobacco, chemicals, rubber industry, vehicles apart from automobiles and motorbikes, paper industry and office equipments. The last group consists of the products of pharmaceuticals, petro-chemicals, oil processing and of the

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automobile industry. It is known that China has not been competitive in these markets but it has a chance to improve its capabilities and competitiveness to some extent for the medium and long terms. The foreign surplus China maintains in its trade with Turkey as it does with other countries cannot be explained by referring merely the cheap labor. China utilizing the opportunities of the membership of WTO has acquired new advantages to enter worldwide markets of abovementioned products in the first group. Particularly, in the markets of textile and ready wear products alongside many other fields Beijing has had considerable gains while sustaining tremendous public incentives for the export.,6 These are the major responsible factors behind the bilateral trade which has increasingly been developing to the disadvantage of Turkey. Nevertheless, there also exist other critical reasons leading to the foreign deficit Turkey bears in its trade with China: -Due to the foreign trade policy Beijing pursues, the right to merchandise in China is granted only to particular firms while also export and import transactions of these firms are contingent on different types of permissions. Accordingly, Chinese business has been transformed into a market dominated by large firms rather than the Small and Medium Sized Enterprises (SMEs). -High customs duties and the lack of coordination in tariff regulations create difficulties in exporting goods to China. -The condition that foreign companies are given authority for production only to export brings about constraints on import trade. However, any individuals or legal persons having tax identification number in Turkey enjoy the right to import without restrictions. 6 TOBB, The Impact of China on the World Trade Organization [in Turkish], Report, Ankara 2004, p.1-20.

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-In contrast to the problems in the regulations governing foreign exchanges in China, buying and selling freedom of foreign currency in Turkey makes import easier. -Low costs of production increase the competitive capacities of Chinese products. -The presence of many Chinese companies in Turkey raises the amount of Turkey's import. Although the bulk of these companies has been established by domestic capital, they entered the market to import from China.7 -The deficiencies in the infrastructure such as the absence of distribution channels set hurdles to Turkish firms in their entry to the Chinese market.8 - With the agreement on textile and ready wear which came into force in 1995, quotas on textile products were removed from January 1, 2005 onward. -Nonetheless, China providing the domestic firms with public support has begun to increase its export in spite of the quotas.9 3. The Safety Measures For the Development of Bilateral Trade It is inevitable for Turkey to originate new policies in order to eliminate the imbalances existing in its trade with China. Through the accession of China to WTO, not just the markets of Turkish products were captured by Chinese companies but Turkey lost its competitive advantage in international markets. This upheaval is clear if changing places of Turkish and Chinese textile products in the US market are taken into consideration. The dominant position 7 Hidayet Gayret, An Analysis of Chinese Economy and Turkey-China Economic Relations [in Turkish], ASAM, Jan. 2004, p.10. 8 http://www.sectoryayincilik.com/yedekparca/detay.asp?y=305 9 Ayse Tarcan, “The Protectionist Lobby against China” [in Turkish], Aksam Gazetesi, Economy Page, September 9, 2003

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of Turkish textile in the American market has been replaced by the Chinese products. Turkey seems able to develop certain policies for the purpose of enlarging its share in the foreign trade with China: -Focusing on particular products of high competitive power, Turkish entrepreneurs may possibly cling to the Chinese market and later on diversify those products by increasing their market shares. -For the products of lesser competitive power, new products-oriented distribution networks can be developed through collective action with other foreign companies which are also the associates of Chinese firms. At this point, Ankara enjoys the opportunity to utilize its economic cooperation agreements with different countries. -In China, beside low costs of labor force, production itself is backed by state-owned enterprises. Likewise, companies in Turkey that manufacture goods for Chinese market ought to be promoted. In order to increase the competitive powers of the products of those companies in Chinese market, necessary measures should be taken to reduce the burdens on energy, raw materials, financing, and labor. Cost incentives must be supplied in favor of the export industries directed towards China. - Turkish firms have to create their own brands particularly in textile products. Because SMEs feature one of the largest segments of Turkish exporters in textile industry, the methods addressing the concerns of this group alongside sizable exporters should be implemented. Such all-inclusive implementations will also serve both the quality and productivity of domestic manufacture. -The information and technology intensive products ought to be given priority among other materials. -Since China with the biggest population in the world has been neglecting the agricultural sector in its economic drive, the agricultural import of it will inevitably increase in the future. Through investments within the framework of South-Eastern Anatolian Project, known as GAP, 234

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Turkey may acquire extensive shares of market in cereals and other foodstuffs that China needs to import.10 -Utilizing the development project China started in the northwestern part of the country, Turkey can enter both the local and national market by investing in specific sectors in the Eastern Turkistan.11 Necessary legislation and means for taking and implementing the safety measures against China are available in the current system of Turkey. However, there is the urgent need to put these measures into practice with determination. The structure of customs and of the institutions concerned must be improved so that they enjoy the needed authorities and physical opportunities for achieving such measures.12 The bilateral trade between Turkey and China is shaped by the policies of Beijing toward Ankara as well as by the policies it pursues for global markets. Therefore, in order to take effective safety measures, Chinese trade policies and practices in both domestic and international markets should be watched diligently. CONCLUSION The last 15 years of the socio-economic transition period of China, which has been in progress for a quarter century, oriented towards the integration of its changing dynamics with the world. Accepted by WTO as a member and assumed prominent roles in the ASEAN and the SCO, China has accomplished to realize the integration to a certain extent. Having the biggest population and the third largest economy in the world, China has undergone a transformation process that influenced the global economy substantially. In other words, while this process represented 10 Mehmet Ogutcu, “Turkey and China”, Journal of International Affairs, vol 1, no 3, 1996, p.28. 11 Hidayet Gayret, “Will the WTO membership boost Chinese economy?” [in Turkish], Stratejik Analiz Dergisi, Ankara, vol 2, no 24, April 2002, p.103-104. 12 http://www.tobb.org.tr/yayinlarraporlar/TOBB-CinRaporu.pdf.

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opportunities for the developed states alongside the developing countries around China, it was perceived as a threat for the rest of the world. However, the remaining part of the capitalist transformation process of China is still longer than what has been achieved till present. Bourgeoisie as one of the prerequisites of capitalist economic order is in its development phase in China. The distinguished class (60 million) within the most flourishing stratum of Chinese society (200 million) seems to take this role from among the whole population that is currently about 1,3 billion. The group's active involvement in cultural, political, and economic matters at international level manifests China is creating its own bourgeois which appears not quite disconnected with the Western world. Instigated the “Socialist Market Economy” during the tenure of President Deng Xiaoping, China has aimed to modernize the country in the areas of defense, agriculture, industry and of scientific research. However, there are concerns that Beijing will not be able to succeed in performing of all of these goals. The present status of China demonstrates that its system does not have the attributes of a market economy. Uncertainties about sustaining the economic growth have long been indicated by the imbalance in the development of regions and heralded by potential social problems which might stem from urbanization as well as rapid aging. It is possible to confirm the conclusion Paul Krugman inferred from Asian countries in his article published in “Foreign Affairs” for the case of China; the growth of China is not a result of an improvement in productivity but an increase in resources. Despite the unusual economic development of the country in recent years, there has not been such an advance in productivity.(13) As a general maxim, it is known that intense investments in foreign

13 Paul Krugman (2000), The Return of Depression Economics, London, Alen Lane/ The Penguin Press, p.32.

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capital endanger the capital efficiency in businesses. Foreign Direct Investments featured 2,5 percent of the GDP on average in the last five years (2005-2010) and in general greater investments have been made in China compared with the other countries in the region. However, the plethora of investments compelled the enterprises to produce more than their capacities permit by resorting to inefficient means. The lack of equity assets in investments runs serious risks for the Chinese economy distressed by the East Asian crisis in 199798 and dependency on foreign investments generates stakes for the persistence of economic development. China will continue to be the magnet for foreign investments that began in 1990s. Confidence of the country has been boosted in the eyes of foreign investors since China became a member of WTO in 2001 and it grew into a regional power following its initiative to lay the foundations of the Free Trade Area in conjunction with the ASEAN in the late 2004. The Beijing 2008 Olympic Games and the Expo 2010 being held in Shanghai will also give confidence to the foreign investors for the future status of China. Turned their attention to the Asia, Western countries are making policies on China and seeking potential opportunities they might obtain by investing in this country. These countries comprehended the importance of China which as a first time in its history has become a global actor thanks to the production system nurtured by foreign investments. The consent given by the EU, at least in principle, to lift the arms embargo (which has been in force from 1989 onward) on China in June 2005 proves the comprehension. This phenomenon, while exposing the apprehension of both Japan and of Taiwan as the major exporters to China, demonstrates that Beijing as a global actor is recognized by the EU. The Union has intended to acquire larger shares from the economic growth of China in the last years through utilizing its own global influence. In the history of Turks of Central Asia, from among the eastern khanate (Kagan) and the western khanate (Yabgu) of bifurcated Turkish states, it was always the eastern khanate (close to China) that controlled the western one (far from China). The 237

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eastern khanate (close to China) used to be assumed superior to the other and would determine policies. Will continuation of a deep rooted foreign policy by the Republic of Turkey on the eve of 21st century provide us with a place in the east of other countries but in the west of China?14 In order to take its own position in a changing world to be led by China in the future, it is inevitable for Ankara to devise effective and enduring strategies that will prevent this country from being a threat. This is the case, above all, if Turkey is an aspirant to be one of the great states of the 21st century.

14 In the history of Turks of Central Asia, “east” was regarded a sacred direction from which the sun rises.

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Bibliography Arvantitis, Rigas, Miege, Pierre and Wei, Zhao., “Regards sur L'émergence d'une Économie de Marhé” Problèmes Economiques, n:2.846, 3 Mars 2004, pp.12-18. Eberhard, Wolfram., A History of China [in Turkish], Turk Tarih Kurumu Yayinevi, Ankara, 1947. Gayret, Hidayet., “Will the WTO membership boost Chinese economy?” [in Turkish], Stratejik Analiz Dergisi, Ankara, Vol 2, No 24, April 2002 pp.103-104. Fitzgerald, P, C., Chinese Revolution [in Turkish], Translator: Mahmut Garan, Tan Matbaasi, Istanbul 1996. Hale, David and Hale, Hughes., “Les Formidable Essor Économique de la Chine”, Problèmes Economiques n:2.846, 3 Mars 2004, pp.3-11. Hochraich, Diana., “Les enterprises et Les Banques Face au Défi de L'ouverture” Problèmes Economiques, n:2.846, 3 Mars 2004, pp.19-28. Kafesoglu, Ibrahim., Turkish National Culture [in Turkish], Bogazici Yayinlari, 11. Edition, Istanbul 1994. Kona, Gamze Gungormus., Spheres of International Collision and Turkey's Security [in Turkish], IQ Kultur Sanat Yayincilik, Istanbul 2005. Ogel, Bahaeddin., Turkish Cultural History Prior to Islam [in Turkish], Turk Tarih Kurumu Yayinevi, Ankara 1991. Ogutcu, Mehmet, “Turkey and China”, Journal of International Affairs, Vol 1, No 3, 1996, p.28. Perroux, François., Economie des Jeunes Nations, PUF, Paris 1962 Rawski, G. Thomas., “Le Grand Bond des Statistiques Chinoises?”, Problèmes Economiques, n:2.716, 6 Juin 2001, pp.1623. 239

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Reynold, G. Lyod., “Economic Development in Historical Perspective”, American Economic Review, Papers and Proceedings, May 1980, pp.91-95. Rocca, Jean-Louis., “Apres la Mort de Deng Xiaoping: Paradoxale Modernisation de la Chine”, Le Monde Diplomatique, Mars 1997, p.20. Rostov, W.W., Stages of Economic Development [in Turkish], Translator: Erol Gungor, Sosyal Bilimler Komisyon Yayini, Istanbul 1980. Samuelson, A, P., Economique, A Collin, Paris 1982. Sukan, Ozer., The People's Republic of China: HistoryEstablishment-Development, Its Relations with Turkey and Other States [in Turkish], Harp Akademileri Basimevi, Istanbul 2000. Tarcan, Ayse., “The Protectionist Lobby against China” [in Turkish], Aksam Gazetesi, Economy Page, September 9, 2003. TOBB., Report, The Impact of China on the World Trade Organization [in Turkish], Ankara 2004. UNCTAD/WTO., Handbook of World Trade System for Enterprises [in Turkish], (ITC) Uluslararasi Ticaret Merkezi Commonwealth Sekreteryasi (CS), Second Edition, Geneva 1999. Van de Crean, Liesbeth., “Faut-il Réévaluer le Yuan?”, Problèmes Economiques, n:2.846, 3 Mars 2004, pp. 29-33. Websites http://www.foreignaffairs.org http://www.sectoryayincilik.com http://www.deik.org.tr http://www.geocities.com http://www.mfe.org http://www.monde-diplomatique.fr http://www.cefc.com.hk/ http://www.iwep.org.cn http://www.hec.fr http://oecd.org http://www.wto.org 240