EAST ASIA’S RELATIONS WITH A RISING CHINA EAST ASIA’S RELATIONS WITH A RISING CHINA Editor by Konrad Adenauer Foundation EAST ASIA’S RELATIONS WITH A RISING CHINA 007 1. Introduction: China and East Asia’s Mutual Accommodation Lam Peng Er, Narayanan Ganesan and Colin Dürkop 043 2. China’s Accommodative Diplomacy towards East Asia Li Mingjiang 071 3. China’s Image: Citizens in Southeast Asia Viewing a Rising Power Wang Zhengxu and Ying Yang 101 4. North Korea’s Relations with China: From Alignment to Active Independence Kim Sung Chull 145 5. South Korea and the Rise of China: Perception Gap between the Public and Elite Choo Jaewoo 181 6. Japan: What Future with China? Satoh Haruko 217 7. Indonesia-China Relations in the Post-New Order Era Syamsul Hadi 4 EAST ASIA’S RELATIONS WITH A RISING CHINA 243 8. Malaysia-China Relations: Domestic and Structural Imperatives Narayanan Ganesan 277 9. Singapore: Balancing among China and Other Great Powers Lye Lian Fook 325 10. Between the Eagle and the Dragon: Issues and Dilemmas in the Philippine Foreign Policy of“ Equi-balance” Renato Cruz De Castro 365 11. Thailand: Bending with the (Chinese) Wind? Pavin Chachavalpongpun 407 12. Vietnamese Perspective of China’s Rise Khong Thi Binh 445 13. Myanmar’s Relations with China: From Dependence to Interdependence? Tin Maung Maung Than CONTENTS 5 EAST ASIA’S RELATIONS WITH A RISING CHINA CHAPTER ONE INTRODUCTION China and East Asia: Mutual Accommodation Lam Peng Er, Narayanan Ganesan and Colin Dürkop CHAPTER ONE: INTRODUCTION China and East Asia: Mutual Accommodation Lam Peng Er and Narayanan Ganesan he economic rise of China is an intriguing question T for both scholars of international relations and practitioners of statecraft: what are its implications for the global political economy and the regional pecking order in East Asia? Will China’s rise underpin a more prosperous and stable East Asia and nascent regionalism, or usher in greater uncertainty, contentious territorial disputes with its neighbours, and big power competition and conflict with the US and its ally Japan? Will Beijing become a contented, responsible, cooperative and amicable power which has successfully harnessed international norms and institutions of our contemporary world (despite their Western origins) to its own advantage? Or will it seek to unilaterally remake the“rules of the 8 EAST ASIA’S RELATIONS WITH A RISING CHINA game”and forge a Sino-centric order in East Asia? Is Beijing’s professions of a“peaceful rise”believable to its neighbours? In the midst of the unprecedented global financial crisis triggered by the US sub-prime mortgage problem in 2008, China is a rare major economy which is seeking to achieve an impressive growth rate of at least eight percent in 2009 (though below the phenomenal double digit growth rates of the previous few years).1) It may well be the first major country in the world to enjoy a strong economic rebound. Indeed, the Chinese mainland is poised to overtake the stagnant Japanese economy within the next few years and emerge as the second largest economy in the world. Simply put, 1) There is the perception that China needs a minimum economic growth rate of 8 percent to provide employment and resource distribution to ensure social stability. However, a case can be made that the law and order capacity of the Chinese state appears adequate to snuff out and prevent any local protests from snowballing across major cities and provinces even if economic growth were to dip below 8 percent. Insofar as a majority of its population believe that the system in China holds the prospect of a better life for themselves and their offspring, it is unlikely for any nation-wide movement to emerge and challenge the rule of the Chinese Communist Party (CCP). Moreover, the CCP has never allowed any alternative and autonomous organizations to emerge as a potential challenger to its rule. Whether it is the quasi-religious Falungong or the pro-democracy movement of Tiananmen in 1989, they have been ruthlessly nipped in the bud. Apparently, the CCP has the iron will, confidence, resources and coercive capacity to rule in the years ahead. Despite the erosion of its Marxist-Maoist ideology, the CCP underpins its mandate to rule through the economic delivery of goods to the masses, appeal to Chinese nationalism, provision of better governance (not necessarily liberal democracy), and the incorporation of its former class enemies (including entrepreneurial capitalists) into the nominally communist party. Arguably, the post-Mao CCP has been pragmatic at home and abroad despite its revolutionary origins. In the years ahead, the CCP may well morph further to become, in reality, the Chinese Capitalist Party which maintains an authoritarian regime while contradictorily keeping Mao as its historical icon. The Chinese leadership downplaying of Maoist ideology has gone down well with the non-communist regimes in East Asia and Chinese“communism”is no longer a barrier to better relations and a source of suspicion between Beijing and its non-communist neighbours. CHAPTER ONE: INTRODUCTION 9 China will become the number one Asian economy within a decade. Conceivably, Beijing will have more resources to undergird its political and cultural diplomacy, foreign aid, and military capabilities to reclaim its preeminent position in East Asia before the traditional Sino-centric order was destroyed by Western and Japanese imperialism. Indeed, a strong case can be made that China was the once and future great power in the region. Notwithstanding the myriad of domestic problems faced by China such as rising social inequality (among coastal and inner regions, urban and rural areas, and occupational groups), environmental degradation, unrest among ethnic minorities in Tibet and Xinjiang, endemic corruption, and weak observance of law and regulations, the country appears to be rising inexorably, at least in the economic dimension. With the advent of a KMT presidency (which does not favour de jure independence for Taiwan), the danger of brinksmanship and war in the Taiwan Strait appears increasingly remote. In this regard, the avoidance of conflict in the Taiwan Strait is also in the best interest of China by allowing it to concentrate on economic growth, address its own domestic challenges and seek diplomatic success abroad. Apparently, Beijing pays more attention to East Asia and ASEAN than the US superpower which appears to be distracted by problems in the Middle East, especially Iraq and Afghanistan. After all, East Asia is China’s historical, geographical, economic, political and cultural backyard. Washington’s focus on East Asia was further distracted by the US subprime triggered-global financial crisis --- the worst 10 EAST ASIA’S RELATIONS WITH A RISING CHINA recession faced by the world since the Great Depression of the 1930s --- to the advantage of Beijing. This unprecedented crisis where a globalized world sinks into a synchronized recession has severely dented the credibility of the Anglo-Saxon model of market “fundamentalism”and its assumptions of unfettered market efficiency, deregulation and privatization (the so-called Washington Consensus of the US-dominated IMF, World Bank and US Treasury). The severity of this crisis will probably not only erode the“soft power”of the US in the eyes of many but will bolster the so-called Beijing Consensus which privileges a strong, regulatory and developmental state, innovation, economic nationalism and self- determinism.2) The state-centric approach of the“Beijing Consensus” will probably be more attractive to less developed East Asian countries which enjoy no level playing field in the capitalist jungle where often only the fittest, strongest and meanest can survive and thrive. Additionally, such a model favours incumbent regimes and collapses the distinction between state interests and regime interests that appears to be characteristic of developmental states in East Asia. While the Obama Administration is preoccupied with rescuing its own big banks and insurers such as Citigroup and AIG and has little time for Southeast Asian economies, Beijing announced a 2) In actuality, it was post-war Japan which successfully spearheaded the state-led economic developmental model which was subsequently emulated by the NIEs (Newly Industrializing Economies) in East Asia. Ironically, former Prime Minister Koizumi Junichiro embraced the “market fundamentalism”associated with Ronald Reagan and Margaret Thatcher and pushed for“structural reforms”, privatization and deregulation in Japan. CHAPTER ONE: INTRODUCTION 11 thoughtful, helpful and impressive package for ASEAN to surmount the global financial crisis. Prime Minister Wen Jiabao originally planned to make a three-point proposal at the abortive ASEAN summit in Pattaya, Thailand in April 2009. Despite the cancellation of the summit in Pattaya due to the unrest and accompanying violence in Thai domestic politics, Wen pledged the following:3) First, put countering the financial crisis at the top of the East Asian cooperation agenda and focus on addressing the most pressing issues facing this region; Second, seize the opportunity of the crisis to make cooperation (sic) in all areas more substantive and robust and advance regional integration; and Third, bear in mind common, long-term interests, unswervingly advance East Asian integration and promote regional peace and prosperity. Simply put, the global financial crisis has presented a golden opportunity for China to woo Southeast Asia at the expense