China's Foreign Policy in 2009

Briefing Series œ Issue 58

CHINA‘S FOREIGN POLICY IN 2009: SHOULDERING GREATER RESPONSIBILITIES AND BUILDING STRONGER PARTNERSHIPS?

Yongnian ZHENG, Liang Fook LYE and Gang CHEN

January 2010

China Policy Institute School of Contemporary Chinese Studies International House The University of Nottingham Jubilee Campus Wollaton Road, Nottingham NG8 1BB, UK Email: [email protected] Website: www.chinapolicyinstitute.org

The China Policy Institute, part of the School of Contemporary Chinese Studies at The University of Nottingham, was set up to analyse critical policy challenges faced by China in its rapid development. Its goals are to help expand the knowledge and understanding of contemporary China in Britain, Europe and worldwide, to help build a more informed dialogue between China and the UK and Europe, and to contribute to government and business strategies.

Executive Summary

1. The global economic crisis has thrust China into the international limelight. Many have accepted China as a global power, and the country has also started to appear or feel that it has become one.

2. China is gradually assuming more responsibilities in global affairs. In 2009 it emerged as a key actor in the global effort to curb climate change and in tackling the global economic crisis.

3. China‘s rising international profile is further manifested in multilateral forums such as the G20 that replaced G7 or G8 as the —premier forum“ for international economic cooperation. The International Monetary Fund has also agreed to increase the representation and voice of developing countries.

4. At the bilateral level, China‘s ties with the US have quickly stabilized in the first year of President Obama‘s first term of office. Despite remaining differences, both countries appear earnest to expand and deepen cooperations.

5. China‘s ties with the EU have recovered from the low point of 2008 when President Sarkozy met the Dalai Lama. The long-delayed China-EU Summit was subsequently held in May 2009.

6. Sino-Japanese relations saw positive progress after Japanese Prime Minister Yukio Hatoyama took office in September 2009. Chinese Vice President Xi Jinping, although not a Head of State, was granted an audience by the Japanese Emperor.

7. In a sign of growing confidence, China seemed open to having various regional cooperative architectures existing alongside and complementing each other. China has further consolidated its ties with ASEAN through introducing measures to help them cope better with the negative impact of the global economic crisis.

8. Cross-Strait relations have progressed further under the principle of —economics first, politics later.“ President Ma Ying-jeou will next have to ensure that the improving cross-Strait ties benefit more Taiwanese people. He will also need to be seen as being able to stand up for Taiwan vis-à-vis China.

9. Going forward, China will continue to play the role of a responsible and constructive player on the world stage. This would entail stepping up efforts with other partners to better address common global and regional challenges like climate change and sustaining the growth momentum of the world economy.

10. While getting more involved by virtue of its growing clout, China is likely to be selective in terms of its degree of involvement. This is because China is still facing daunting domestic challenges.

11. Moreover, China‘s global strength, both hard and soft power, is still on a weak foundation.

12. China neither wants nor is prepared to supplant the still pre-eminent role of the US. So far, China has ensured key US interests are not jeopardized due to the expansion of China‘s influence, a pattern that is expected to continue.

China‘s Foreign Policy in 2009: Shouldering Greater Responsibilities and Building Stronger Partnerships

Zheng Yongnian, Lye Liang Fook & Chen Gang *

Towards Great Power Status

1.1 In the last two decades, China‘s foreign policy has followed the important guiding principle enunciated by its late leader Deng Xiaoping to —keep a low profile and achieve something in the process“ ( ䷀ܝݏ᰺ˈ᳝᠔԰Ў ). Nevertheless, the recent global economic crisis has, by default, catapulted China into the international arena. Its involvement is increasingly seen as critical to resolving many world-wide challenges. Not only has China started to appear or feel that it has become a global power next to the US, but also many world leaders and observers have accepted China as such, some albeit grudgingly.

1.2 Indeed, China has not only been more active but assumed more responsibilities on the external front in 2009. Most notably, China has emerged as a front runner in the global fight against climate change. It was a key broker in coming up with the Copenhagen Accord at the recently concluded United Nations Climate Change Conference. Despite being the world‘s largest developing country, it has committed itself to the ambitious target of reducing carbon emissions per unit of GDP by 40-45% by 2020 from 2005 levels.

1.3 To help the world economy recover from the negative impact of the global economic crisis, China has been actively involved in international cooperation. It has also maintained its growth momentum that has contributed to global economic recovery . In the field of maritime security, China lent its weight to the fight against international piracy by escorting merchant vessels through the Gulf of Aden.

* Dr Zheng Yongnian is Professor and Director of the East Asian Institute (EAI) at the National University of Singapore. Mr Lye Liang Fook and Dr Chen Gang are Research Fellows at the same institute. China Policy Institute takes great delight in publishing this review together with the EAI. The authors would like to thank Professor John Wong for his valuable contributions to the preparation of this work.

1.4 China‘s relations with its key partners have either generally improved or broke new ground. In particular, China‘s ties with the US have quickly attained a stable footing in the first year of President Obama‘s first term of office. This has provided a basis for the two countries to expand and deepen cooperation on several fronts. China‘s relations with the EU have also recovered from the low point of 2008 when President Sarkozy met the Dalai Lama.

1.5 Closer to home, China‘s relations with Japan have seen positive developments. Japan‘s Prime Minister Fukio Hatoyama pledged not to visit the Yasukuni Shrine even before assuming office in September 2009. China has further consolidated its relations with ASEAN by devising various measures to help these smaller countries cope better with the negative impact of the global economic crisis. However, China‘s relations with India remain testy over issues such as the disputed border, the Dalai Lama and China‘s growing international clout.

1.6 China has further strengthened its ties with Taiwan particularly on the economic and social fronts. Both sides have taken a pragmatic approach when handling political issues such as Taiwan‘s participation at the World Health Assembly and the safety of Taiwan‘s merchant vessels through the Gulf of Aden. Despite improving cross-Strait ties, both sides are aware of the need to proceed with caution to avoid a political backlash among certain quarters in Taiwan concerned with being too close and too dependent on China.

1.7 China‘s efforts to assume greater responsibilities and to build stronger partnerships are consistent with China‘s desire to be seen as a responsible and constructive member of the international community. China wants to reinforce the message that its rise poses no threat to any country and is in fact beneficial to the rest of the world.

1.8 To a large extent, the international environment has also become more conducive for China to assume more responsibilities. In particular, China‘s ability to weather the global economic crisis has inadvertently raised China‘s standing in the eyes of the international community. There is much expectation for China to do more to help the world economy recover. China has so far skilfully capitalized on these expectations to play a more active role.

1.9 To be sure, China is keen to work with like-minded partners and only sometimes take the lead on selected issues it considers pertinent to its interests. China is still searching for the best approaches to engage in global affairs, while at the same time focusing more on its internal challenges. Hence, China is still on the way to cast Deng Xiaoping‘s ䷀ܝݏ᰺ principle away. Its leaders have repeatedly emphasized that China is still a developing country. Officially, China rejects the concept of G2. China also realizes that it alone cannot perform a great power‘s responsibilities given its own limitations.

Rising International Profile

2.1 China‘s international profile continued to strengthen in 2009, primarily due to its success in weathering the global economic crisis. At a time when other countries are still reeling from the crisis, China has seized the opportunity to assume more responsibilities in addressing several emerging challenges confronting the world. These include restoring growth to the world economy, tackling climate change and fighting piracy off the Somali coast.

2.2 China‘s rising international profile is most evident in multilateral forums. Most significantly, the G20 Pittsburg Summit in September 2009 agreed that the G20 would become the "premier forum" for international economic cooperation, supplanting the Western-dominated G7 and G8 that were the primary forums for decades.1 This is clear acknowledgment that fast-growing countries such as China and India now play a much more important part in world growth.

2.3 China has managed to push for an increase in the representation and voice of developing countries in global financial institutions such as the International Monetary Fund (IMF). At the G20 Pittsburg Summit, it was agreed that there would be a shift in the IMF quota share to dynamic emerging markets and developing countries of a least 5% from over-represented countries to under- represented ones. 2 The final distribution would depend on the outcome of negotiations among member nations which are expected to conclude by 2011. 3

1 See —Leaders‘ Statement: The Pittsburg Summit“ dated 24-25 September 2009 at http://www.pittsburghsummit.gov/mediacenter/129639.htm . 2 China has called on the IMF to establish a new automatic mechanism to adjust a country‘s quota in line with changes in its economic power. The IMF has instead preferred to stick to the current formula of assigning a quota that is broadly based on a country‘s relative share of the global economy. A review is conducted every five years for any possible required adjustments. See —China pushes for new quota system“, Global Times , 9 October 2009. 3 China's current IMF quota is 3.72 percent, the sixth largest. The US and Japan hold 17.09 percent and 6.13 percent respectively.

2.4 China‘s rising clout is also felt on the environmental front. In the lead-up to the UN Climate Change Conference in Copenhagen in December 2009, China stood out in its strong commitment to fight climate change. At the UN Summit on Climate Change in September 2009 for instance, Hu Jintao pledged that China will cut carbon emissions per unit of GDP by a —notable margin“ by 2020 from the 2005 level. 4 Premier Wen Jiabao subsequently announced that China will reduce carbon emissions per unit of GDP by 40-45%. 5 In contrast, President Obama‘s promised emission cut of 17% from 2005 levels by 2020 is being perceived in several quarters as not doing enough. 6

2.5 At the just concluded United Nations Climate Change Conference, China emerged as an important player in brokering the Copenhagen Accord. Although the accord came under flak for its non-binding pledges to address climate change, Chinese Foreign Minister Yang Jiechi has described the outcome as —significant and positive.“ China is likely to play an active role in rallying other developing countries towards a more substantive agreement. It is also expected to extend aid to developing countries to better equip them to fight climate change.

2.6 China has since the start of 2009 provided naval escorts to protect merchant ships against pirate attacks in the Gulf of Aden (off the Somali coast) .7 These naval escorts mark the first time the Chinese navy has been deployed far beyond China's territorial waters in recent times. While having some reservations about China‘s projection of its naval power, the navies of other countries such as the US, EU member states, Russia and India seemed to welcome the opportunity to work alongside and observe first hand how the Chinese navy operates beyond its shores.

4 Hu Jintao further committed to an increase in the share of non-fossil fuels in primary energy consumption to around 15 percent by 2020. He also stated that China will energetically increase forest carbon sink and endeavor to increase forest coverage by 40 million hectares and forest stock volume by 1.3 billion cubic meters by 2020 from 2005 levels. See Hu Jintao‘s speech at the opening session of the UN Summit on Climate Change dated 22 September 2009 at the website of the Permanent Mission of the PRC to the UN at http://www.china- un.org/eng/zt/hu2009summit/t605738.htm . 5 —China emissions cut promise serious, says Premier“, Xinhuanet , 27 November 2009 at http://news.xinhuanet.com/english/2009-11/27/content_12552396.htm . 6 —Obama to set goals to reduce emissions; going to Copenhagen, President's target reflects U.S. political reality“, Washington Post , 26 November 26, 2009. 7 —Chinese naval fleet sails into Gulf of Aden“, China Daily , 6 January 2009.

2.7 China‘s rising international profile has generated a new found sense of national pride. This has enhanced the legitimacy of the Chinese leaders in the eyes of its people and strengthened their hold on power. At the same time, however, the Chinese leaders are wary of taking on additional international responsibilities which may exert unnecessary burden on a country still preoccupied with daunting domestic challenges.

More Common Interests with the US

3.1 China‘s rise would not have been possible if Beijing did not successfully manage its bilateral relationship with the US. Rather than supplant the role of the US, Beijing has shown that it wants to work with the US to tackle global challenges. On its part, the US has stressed the importance of shared responsibilities. The US welcomes China to play a more active role as a responsible member of the international community. 8 This pragmatic orientation has provided a good basis for China to broaden and deepen its ties with the US.

3.2 Both countries have cooperated either bilaterally or at the multilateral level to introduce measures to tackle the negative impact of the global economic crisis, fight global warming and push for the denuclearization of the Korean Peninsula. The two countries held their first ever Strategic and Economic Dialogue in Washington in July 2009. 9 Vice Chairman of the Central Military Commission Xu Caihou visited the US in October 2009, a sign of improving military-to-military relations.

3.3 Most significantly, China hosted a visit by President Obama in November 2009 where the key thrust was on building a positive, constructive and comprehensive relationship. To reassure his Chinese audience, Obama reportedly said that the US does not —seek to contain China's rise“ but

8 In February 2009, Secretary of State Hillary Clinton said on the eve of her Asian tour (with visits to Japan, South Korea, Indonesia and China), that the US did not perceive a rising China as an adversary. On the contrary, she believed that the US and China can —benefit from and contribute to each other‘s successes. It is in our interest to work harder to build on areas of common concern and shared opportunities“. See Hillary Clinton‘s remarks at Asia Society titled —US-Asia Relations: Indispensible to Our Future“ dated 13 February 2009 at http://www.state.gov/secretary/rm/2009a/02/117333.htm . 9 The Strategic and Economic Dialogue focuses on addressing the challenges and opportunities that both countries face on a wide range of bilateral, regional and global areas of immediate and long term strategic and economic interest. This is a broader and more comprehensive forum that supercedes the Strategic Economic Dialogue created in 2006 that focuses on economic and financial issues.

welcomes China as a —strong, prosperous and successful member of the community of nations.“10

3.4 To be sure, significant differences still remain between China and the US such as over human rights, democracy and the overvalued renminbi . The two countries also increasingly clash over trade disputes involving automobiles and car parts, steel products, poultry and raw materials. In fact, just prior to Obama‘s China visit, China had accused the US of being protectionist after the US slapped anti-dumping duties on Chinese steel pipe imports .11

3.5 Despite their differences, the two countries have maintained a high degree of level-headedness and not allowed things to get out of hand. They have instead pursued cooperation on various other fronts. This has contributed to a more stable regional and international environment.

The European Union and Other Key Partners

4.1 China-European Union (EU) relations have recovered from the low point of last year when China postponed its scheduled summit with the EU to protest against French President Nicholas Sarkozy‘s meeting with the Dalai Lama. 12 Thereafter, China put the onus on France to get Sino-French and China-EU relations back on track. The breakthrough occurred at the sidelines of the G20 London Summit in April 2009 when France reaffirmed its policy of there —being only one China and that Tibet is an integral part of Chinese territory.“ 13 On its part, China seemed eager to look beyond this episode and work with the EU to implement measures to restore confidence in world markets. The long-delayed China-EU Summit was eventually held in May 2009.

4.2 China‘s relations with Japan have improved noticeably after Prime Minister Yukio Hatoyama took office in September 2009. Hatoyama‘s predecessor Taro Aso had riled China after he remarked that the disputed Senkaku islands

10 Obama reportedly made these remarks while addressing a group of students in Shanghai. See —There‘s room for both of us“, China Daily , 17 November 2009. Before visiting China, Obama was also reported to have said in a speech in Tokyo that the US welcomes —China's efforts to play a greater role on the world stage œ a role in which their growing economy is joined by growing responsibility“. Obama added that —power does not need to be a zero-sum game and nations need not fear the success of another“. See —China‘s role on world stage is no cause for alarm, says Obama“, The Observer , 15 November 2009. 11 —China brands US protectionist“, Financial Times , 6 November 2009. 12 French President Sarkozy had met the Dalai Lama in Poland in December 2009 when the former was holding the rotating EU Presidency. 13 —G20 summit: France and China heal rift over Tibet“, The Telegraph , 1 April 2009.

(known to China as Diaoyutai) were part of Japanese territory and hence covered by the US-Japan Security Alliance. 14 These remarks and other incidences cast a pall over Aso‘s visit to China in April 2009. 15 In contrast, Hatoyama seemed more adept at building ties with China. He has vowed to stay away from the Yasukuni Shrine and proposed to build a new, non-religious state war memorial as an alternative. He has further called for a more equal partnership with the US and offered to work with China to build an East Asian Community.

4.3 In terms of regional cooperative architectures, China has adopted a rather open-minded approach towards them. Although China prefers the ASEAN plus Three process, it has not publicly opposed Kevin Rudd‘s Asia Pacific Community nor Hatoyama‘s East Asian Community, both of which advocate a role for the US. In fact, Chinese Vice President Xi Jinping reportedly said during his Japan visit in December 2009 that Hatoyama‘s East Asian Community is a common goal of all countries in the region. China seems prepared to accept a variety of regional architectures that are mutually complementary. 16 This partly reflects China‘s growing confidence and partly China‘s reluctance to be seen as promoting exclusivity and thus subject itself to criticism that it seeks to dominate the region.

4.4 China has further consolidated its relations with ASEAN. In their time of need, China introduced concrete measures to help the smaller countries in the region cope better with the negative impact of the global economic crisis. 17 Beyond economics, and in line with ASEAN‘s interests, China has reiterated its support

14 —Japan and China seek agreement beyond island row“, Reuters , 28 February 2009. 15 Just before his April visit to China, Aso had presented a gift to the Yasukuni Shrine that honours Japan‘s war dead and convicted war criminals. In the same month, the Japanese Foreign Minister Hirofumi Nakasone accused China of withholding information about the development of its nuclear weapons. See —China rejects Japan‘s accusation over its nuclear policy“, Xinhuanet , 28 April 2009 at http://news.xinhuanet.com/english/2009- 04/28/content_11274603.htm . 16 China‘s Foreign Ministry spokesman Ma Zhaoxu reportedly said in October 2009 that —In the foreseeable future, countries in the Asia-Pacific region will continue to have multi-tiered cooperation through multiple mechanisms at various speeds. The cooperation will also remain mutually complementary for common development“. See —Foreign Ministry Spokesperson Ma Zhaoxu's Regular Press Conference“ on October 15, 2009 at http://www.mfa.gov.cn/eng/xwfw/s2510/2511/ t620826.htm . 17 These measures include establishing a China-ASEAN investment cooperation fund totaling US$10 billion to promote infrastructural development to enhance connectivity between China and ASEAN; offering US$15 billion worth of credit to ASEAN countries to fund cooperation projects; and, providing US$39.7 million in special assistance to Cambodia, Laos and Myanmar to meet urgent needs. Premier Wen Jiabao had intended to make public these measures during the ASEAN-related summits that were to be held in Pattaya in April 2009. However, the summits were postponed due to Thailand‘s unstable political situation. China therefore announced these measures immediately after the postponement of the summits.

for the continued centrality of ASEAN in the various ASEAN-plus regional architectures such as ASEAN plus Three and the ASEAN Regional Forum. While disputes such as those in the South China Sea occur from time to time, they have not seriously affected the momentum of China-ASEAN cooperation.

4.5 Toward the end of the year, the negotiation at Copenhagen failed to reach a binding agreement, and to many China was to be blamed. The execution of a British citizen who was found guilty for attempting to smuggle 4.5 kilogrammes of heroine into China caused fury among many Britons. Issues like these remind both China and the West that major differences and a lack of understanding of each other‘s values and policy processes can endanger China‘s effort to become a responsible partner in global affairs. The other side of the argument is that policy makers and opinion leaders in the West still lack sufficient knowledge about how things work in China. 18

Strengthening Cross-Strait Relations

5.1 While China regards the Taiwan issue as an internal affair, it has dealt with the issue in the context of its international relations. In 2009, cross-Strait relations have made further progress under the broad principle of —economics first, politics later“ ( ܜ㒣ৢᬓ ). In particular, China has made a concerted effort to assist Taiwan to weather the global economic downturn so as to win over a wider cross-section of Taiwan‘s population for closer relations with China. In April 2009, the two sides signed three agreements on starting regular flights, boosting financial cooperation and cracking down on crime. 19 Throughout the year, numerous delegations from China have also visited Taiwan on purchasing missions and to explore business opportunities. 20

5.2 China has not only kept up its exchanges with Kuomintang (KMT) politicians but also reached out to other politicians in favor of engaging with China. Hu Jintao met KMT Honorary Chairman Lien Chan again at the sidelines of the APEC

18 See Jonathon Fenby, —How not to handle China ˖ From Copenhagen to Akmal Shaikh's execution, the west's failed diplomacy has shown it doesn't get how politics works in Beijing“ in The Guardian, 30 December 2009. 19 These agreements were reached during talks between Chen Yunlin (President of China‘s Association for Relations Across the Taiwan Straits) and Chiang Pin-kung (Chairman of Taiwan‘s Straits Exchange Foundation) in Nanjing in April 2009. See —ARATS, SEF sign three agreements“, China Daily , 26 April 2009. 20 Jiangsu Party Secretary Liang Baohua reportedly led the largest-ever delegation comprising 3,000 members to Taiwan in November 2009. He is also the highest ranking Chinese official to visit Taiwan so far. See —Largest China purchasing mission arrives“, The China Post , 10 November 2009.

Leaders Meeting in Singapore in November 2009. 21 More importantly, Kaohsiung Mayor Chen Chu ( 䰜㦞 ) became the most senior opposition Democratic Progressive Party (DPP) leader to visit Beijing in May 2009. 22 Subsequently, former DPP legislator Hsu Jung-shu ( 䆌㤷⎥ ) and former DPP Agriculture Minister Fan Chen-tsung ( 㣗ᤃᅫ) also visited China in July 2009. 23 Such interactions reflect China‘s growing importance to Taiwan. They also reflect China‘s success in making inroads into the green camp previously opposed to dealing with China.

5.3 Beyond the bilateral realm, China and Taiwan have collaborated at broader levels such as fighting piracy and securing greater international space for Taiwan. The People‘s Liberation Army Navy has escorted Taiwan-registered merchant vessels through pirate-infested waters off the Somali coast. 24 China also gave the nod for Taiwan to be admitted as an observer at the World Health Assembly in April 2009. These instances show that the momentum of improving cross-Strait relations has uncovered political or security-related issues that require immediate attention although the official line is to focus on economic matters first. Notably, both parties have avoided politicizing these issues and instead opted for a pragmatic approach.

5.4 While cross-Strait relations have made commendable progress, there remain a number of challenges. Foremost among them is the uncertain level of domestic support that President Ma Ying-jeou has in pursuing closer relations with China. The result of the county and city elections in Taiwan in December 2009, where the KMT lost Yilan County ( ᅰ݄ও) to the DPP and suffered an overall decline in popular support, has apparently reduced his degree of maneuverability vis-à-vis China. 25

5.5 Clearly, Ma Ying-jeou‘s hardworking and incorruptible image had failed to translate into more votes on the ground. Instead, voters seemed upset over a

21 The two had met at the sidelines of the APEC Leaders Meeting in Peru in 2008. They had also met a couple of times in Beijing. 22 Chen Chu was in Beijing ostensibly to promote the World Games in Kaohsiung in July 2009. 23 The two were attending a KMT-Chinese Communist Party (CCP) Forum in Hunan in July 2009. 24 —Navy keen to protect Taiwan ships from piracy“, China Daily , 8 April 2009 and —Chinese navy again escorts Taiwan ships off Somalia“, China Daily , 5 March 2009. 25 In this election, the KMT lost Yilan County which it won over in 2005. Before that, Yilan County was a DPP stronghold. The DPP had governed Yilan County for over 24 years (from 1981-2005). The KMT also lost Hualian County due to infighting within the KMT. The Hualian seat was won by a non-partisan candidate previously from the KMT. Furthermore, the KMT saw a drop in popular support across the board (from 50.96 percent in 2005 to 47.86 now) while support for the DPP increased markedly (from 38.2 percent in 2005 to 45.32 now).

host of issues including Taiwan‘s lackluster economic performance, the poor handling of US beef imports, the slow response to Typhoon Morakot and concerns over the proposed signing of an Economic Cooperation Framework Agreement with China. Henceforth, Ma will have to tread more cautiously in his China policy so as not to alienate more supporters. He will need to ensure that the benefits arising from closer cross-Strait ties are not only tangible but also extended to a larger proportion of the Taiwanese people. He will also need to be seen as being able to stand up to China in articulating Taiwan‘s interests.

5.6 The role of the US is another factor that could affect cross-Strait relations. At the moment, with the emphasis on pursuing cooperation in various areas with China, the US has less reason to play the Taiwan card. This was evident in the joint statement issued following Obama‘s China visit where the US stated that it —looks forward to efforts by both sides to increase dialogues and interactions in economic, political and other fields, and develop more positive and stable cross- strait relations.“ 26 Yet, the US has also stated that it remains committed to beefing up Taiwan‘s defense. The possible sale of F-16 C/D to Taiwan in the not too distant future would trigger a downturn in US-China relations. 27

Going Forward

6.1 China looks set to continue to play the role of a responsible and constructive player on the world stage. This would entail stepping up efforts with other countries and international institutions to better address common global and regional challenges and issues like climate change, terrorism, piracy, denuclearization of the Korean Peninsula and sustaining the growth momentum of the world economy. It will also want to ensure that the restructuring of international institutions like the IMF proceed according to its expectations.

6.2 China‘s relations with the US can be expected to make further progress on the basis of the foundation laid in 2009. Already, President Hu Jintao has accepted President Obama‘s invitation to visit the US in 2010. While the Taiwan issue has been momentarily put on the backburner, it may rear its ugly head again should

26 See —US-China Joint Statement“ dated 17 November 2009 issued by the White House. Available at http://www.whitehouse.gov/the-press-office/us-china-joint-statement . 27 This point was reiterated by Raymond Burghardt (Chairman of the American Institute in Taiwan, the de facto US Embassy) when he called on President Ma a few days after Obama‘s visit to China. See —US may sell F-16s to Taipei“, Straits Times , 25 November 2009.

the US choose to push for the controversial sale of fighter jets to Taiwan. This, however, appears unlikely before Hu‘s visit to the US.

6.3 China‘s ties with the EU, Japan and ASEAN are also likely to continue to strengthen particularly in the areas of trade, investment and financial cooperation. In the long run, China would like to beef up its economic linkages with these countries and region as part of its strategy to reduce its dependence on the US market. Most notably, the China-ASEAN Free Trade Area will become fully operational in 2010. This will further underscore China‘s commitment to free trade and reinforce the message that China‘s growth is beneficial to the region.

6.4 While assuming more active international roles and responsibilities, China is likely to proceed with caution. This is because China is still grappling with daunting domestic challenges that require its undivided attention. Without overstretching itself, China will in all likelihood seek to proactively shape an external environment that will create favourable conditions for it to focus on its domestic agenda. It will therefore continue to officially adhere to Deng Xiaoping‘s ䷀ܝݏ᰺ policy.

6.5 China is also neither willing nor prepared to supplant the role played by the US on the world stage. Although the standing of the US has received a beating following the global economic crisis, the US remains influential and continues to be looked up to by others. China would continue to officially eschew references to the G2 concept and work with the US as well as other partners to jointly address common challenges. To a large extent, whether China‘s world power status can continue to strengthen would depend on its continued ability to successfully manage its relations with the US.

6.6 China is also aware of the need to avoid ruffling the concerns other countries may have regarding its rise if it were perceived as moving too aggressively on the world stage. Hence, while getting more involved in various international and regional platforms and issues by virtue of its growing presence, China is likely to continue to be selective in terms of its degree of involvement.

6.7 To be a responsible power on the world stage, China‘s leaders will further have to grapple with the growing nationalistic sentiments of its people especially among the younger generation. This group of Chinese is the by-product of

China‘s success on the socio-economic and international fronts, and they would not take lightly to perceived slights to China‘s new found status.

APPENDIX: A CHRONOLOGY OF SELECTED KEY EVENTS IN CHINA‘S FOREIGN AFFAIRS IN 2009

A Chinese naval fleet, comprising two destroyers and a supply ship, arrived 6 Jan in the waters of the Gulf of Aden (off Somalia) and carried out its first escort mission against pirates.

Sun Bigan (China‘s special envoy to the Middle East) called on the parties in the Israeli-Hamas conflict to exercise restraint, cease military action and 6 Jan armed conflict and create conditions for peaceful talks and political settlement.

Chinese Vice Foreign Minister Wang Guangya and Japanese Deputy Foreign 9 Jan Minister Mitoji Yabunaka held the ninth strategic dialogue to exchange views on bilateral ties and other regional and international issues.

Premier Wen Jiabao embarked on a — journey of confidence“ to Europe, 27 Jan visiting Switzerland, Germany, Britain, Spain and Brussels. France is œ 2 Feb noticeably absent from Wen‘s itinerary.

7-19 Chinese Vice Premier Hui Liangyu visited the Latin American countries of Feb Argentina, Ecuador, Barbados and Bahamas.

8-22 Chinese Vice President Xi Jinping initiated official visits to Latin America Feb covering Mexico, Jamaica, Colombia, Venezuela, Brazil and Malta.

President Hu Jintao visited Saudi Arabia and the four African countries of Mali, Senegal, Tanzania and Mauritius. While Saudi Arabia is China‘s largest 10 œ 18 supplier of crude oil, Hu‘s visit to the other four African countries is intended Feb to show that China‘s relations with the African continent goes beyond natural resources. The four African countries are not rich in oil or mineral resources. In her first trip overseas, US Secretary of State Hillary Clinton visited Japan, 15-22 Indonesia, South Korea and China. In China, she soft-pedaled controversial Feb issues like human rights and urged both countries to work together to overcome the global financial crisis and fight climate change. Chinese President Hu Jintao and his US counterpart Barrack Obama met for 1 Apr the first time on the sidelines of the G-20 Leaders Summit in London. They agreed to launch the China-US Strategic and Economic Dialogue. China and France issued a press release that said the two sides attached 1 Apr —great importance to China-France relations“ and reiterated their adherence to the principle of non-interference in each other‘s internal affairs.

2 Apr At the G20 Leaders Summit, China pledged US$40 billion to the International

Monetary Fund‘s (IMF) increased financing capacity. It won assurances that the reform of IMF‘s voting structure would be speeded up. In a meeting with ASEAN envoys in Beijing, Foreign Minister Yang Jiechi informed that China had planned to announce an infrastructure investment 12 Apr fund and offer credit to its neighbors at a canceled weekend summit of Asian leaders in Thailand. China and US firms signed 32 trade and investment contracts worth about US$10.6 billion in Washington during the visit of China‘s Commerce Minister 27 Apr Chen Deming to the US. The US Chamber of Commerce said these contracts will support US economic growth and job creation. Japanese Prime Minister Taro Aso embarked on his first visit to China since he took office in September 2008. Before the visit, China had expressed its 29-30 displeasure over Aso‘s presentation of an offering to the Yasukuni Shrine (in Apr Apr) and Aso‘s remarks (in Feb) that China‘s Diaoyutai Islands were part of Japanese territory and hence covered by the US-Japan security treaty. An 18 year-old female Chinese student (surnamed Liu) became China‘s first 16 May patient to contract the Influenza A (H1N1) flu virus. She had returned from the US. Premier Wen Jiabao attended the 11 th summit between China and the EU in 20 May Prague in the Czech Republic. This summit was originally scheduled for December 2008 but was postponed. US House of Representatives Speaker Nancy Pelosi stressed the importance 24-31 of the US and China working together to tackle climate change. In a change May of tact, she avoided criticizing China on human rights. US Treasury Secretary Timothy Geithner gave assurances that China‘s dollar 31 May assets in the US were safe during his visit to China. Both the US and China œ 2 Jun stressed the importance of practical cooperation to address the world economic crisis. Chinese Vice Premier Wang Qishan and Japanese Foreign Minister Hirofumi Nakasone met for a day-long second high-level economic dialogue to discuss 7 Jun closer cooperation to deal with the global economic downturn. The first dialogue was held in December 2007. US Climate Change Envoy Todd Stern met his Chinese counterpart Xie 8-10 Zhenhua in Beijing and agreed to the modest goal of strengthening scientific Jun cooperation in the fight against global warming. China protested the awarding of —honorary citizen“ to the Dalai Lama by the 9 Jun Paris mayor, asserting the action constituted a —grave interference in Sino-

French relations.“ In a sign of lingering tensions in their relations, China rejected India‘s 11 Jun allegation that there were increasing border-crossing incidents by Chinese military forces. In a rare unanimous vote, the United Nations Security Council passed a resolution strongly condemning North Korea‘s May 25 nuclear test. The 12 Jun resolution authorized the inspection of cargo ships bound for North Korea ports, a tighter arms embargo and fresh financial restrictions. US Commerce Secretary Gary Locke and Energy Secretary Steven Chu 14 Jul arrived in China to discuss US-China cooperation on climate change and energy issues. State Councilor Dai Bingguo and Vice Premier Wang Qishan met Secretary of 27-28 State Clinton and Treasury Secretary Timothy Geithner at their first Strategic Jul and Economic Dialogue in Washington.

Hu Jintao met Japan‘s new Prime Minister Yukio Hatoyama in New York (on 21 Sep the sidelines of the United Nations General Assembly) for the first time since the later was elected on 16 Sep.

Hu Jintao pledged to achieve a significant reduction in carbon emissions per 22 Sep unit of gross domestic product by 2020 at a one-day UN Climate Change Summit in New York.

The foreign ministers of China, Japan and South Korea met for the third time in Shanghai to discuss boosting cooperation, preparation for the second 28 Sep tripartite summit of the three countries, and other regional and international issues.

Chinese Premier Wen Jiabao, Japanese Prime Minister Yukio Hatoyama and South Korean President Lee Myung-bak met at their second trilateral summit 10 Oct in Beijing. The leaders of these three countries last met in Fukuoka (Japan) in Dec ‘08.

A Chinese bulk cargo ship, the De Xin Hai, was seized by Somali pirates 19 Oct about 700 nautical miles off the Somali coastline. This is the first time a Chinese ship has fallen into the hands of pirates in the Indian Ocean.

Vice Chairman of the Central Military Commission Xu Caihou visited the US, 24 Oct a sign of improving military-to-military relations between Beijing and œ 3 Nov Washington. Xu‘s visit has also been the highest-level visit by a Chinese military official since 2006.

25 Oct China and ASEAN signed an MOU on the establishment of a China-ASEAN

Center and two MOUs on cooperation on intellectual property rights and technological standards at the sidelines of the ASEAN Summit and related summits held in Hua Hin in Thailand. Singapore Minister Mentor Lee Kuan Yew‘s remarks at the US-ASEAN Business Council Gala Dinner in which the word —balance“ was mentioned 27 Oct elicited a lively response from the Chinese public particularly among its netizens.

29 Oct Vice Premier Li Keqiang began official visits to Australia, New Zealand and œ 5 Nov Papua New Guinea.

The US Commerce Department imposed anti-dumping duties on Chinese- 5 Nov made steel pipes used in the oil and gas industry. China vowed an appropriate response.

Wen Jiabao attended the 4 th Ministerial Conference of the Forum on China- 8-9 Nov Africa Cooperation in Sharm El Sheikh (Egypt).

10-11 President Hu Jintao embarked on a State Visit to Malaysia, the first by a Nov head of state in 15 years. China is Malaysia‘s largest trading partner.

During his State Visit to Singapore, President Hu Jintao offered a pair of 11-13 pandas to commemorate the 20 th anniversary of the founding of diplomatic Nov relations between the two countries next year. After the State Visit, he attended the APEC Economic Leaders Meeting in Singapore from 13-14 Nov.

In his first visit to China, President Obama stated that the US does not seek 15-18 to contain China‘s rise and welcomes China as a —strong, prosperous and Nov successful member of the community of nations“.

19-22 Chinese Foreign Minister Yang Jiechi visited Japan at the invitation of his Nov Japanese counterpart Katsuya Okada.

Following up on President Hu Jintao‘s earlier strong commitment to fight 25 Nov climate change, Premier Wen Jiabao announced that China will cut carbon emissions per unit of GDP by 40-45 percent by 2020 from 2005 levels.

The 12 th China-EU Summit held in Nanjing discussed various issues including 30 Nov climate change, trade and investment, human rights and nuclear non- proliferation.

After much wrangling at the UN Climate Change Conference, a three-page 7-18 document known as the Copenhagen Accord was finally cobbled together. It Dec came under a lot of flak for being vague and non-binding in its pledges to fight climate change.

President Hu Jintao visited Kazakhstan and Turkmenistan. In Turkmenistan, Hu attended the opening ceremony of the China-Central Asian gas pipeline 12 - 14 that runs through Turkmenistan, Uzbekistan and Kazakhstan before reaching Dec Xinjiang. The pipeline, 1,833 kilometres long, is China‘s first transnational ground gas pipeline.

Vice President Xi Jinping visited Japan, Korea, Myanmar and Cambodia. In 14 - 22 a rare honour, Xi was granted an audience by Emperor Akihito although the Dec request for the call came at short notice. British citizen Akmal Shaikh, found guilty for smuggling 4 kilogrammes of 29 Dec heroine into China, was executed by the Chinese authority.