20120319 China faces hurdles on road to top

China faces hurdles on road to top

By Sushil Seth

China is in a hurry to become the world’s superpower. It is now the world’s second-largest economy and it could overtake the US in a decade or two. It will, however, still lag behind the US in terms of per capita GDP for a long while yet. In other words, many of its people will still struggle to make a decent living.

China is now also a major military power, with enough deterrent capability to discourage any threat to its national security. However, it still finds its ambition to do what it likes constrained, for a number of reasons.

The main obstacle is that the US is not facilitating its unilateral claims over the South China Sea and the area’s island chains. Washington is also not terribly keen on conceding the Asia-Pacific region to China’s as its strategic space.

Beijing realizes that without US understanding, if not support, of its “core” interests and strategic concerns, China will feel thwarted in its attempt to achieve primacy over the region. Not surprisingly then, Chinese Vice President and leader-in-waiting Xi Jinping (習近平) said in Beijing just before his visit to the US that he hoped “the US can view China’s strategic intentions ... in a sensible and objective way.”

“Ultimate caution should be given to major and sensitive issues that concern each country’s core interests to avoid any distraction and setbacks in China-US relations,” he said.

Apparently, he did not succeed in this respect during his recent US visit.

Beijing is angry that the US is increasing its military muscle in the region. Reacting to US President Barack Obama’s recent announcement that the US would be prioritizing the Asia-Pacific region as part of its new strategic direction, China’s Xinhua news agency warned: “If the US indiscreetly applies militarism in the region, it will be like a bull in a china shop [literally and figuratively], and endanger peace instead of enhancing regional stability.”

Another problem is that China’s neighbors, though duly impressed with its growing power, are not willing to give up their core interests. For instance, China’s sovereignty claims over regional waters and island chains are strongly contested by Taiwan, Japan and several Southeast Asian countries.

Some of these neighbors also have close strategic ties with the US. Australia, for instance, feels that China’s growing power will destabilize the region, thus posing a security threat.

There are two ways for China to deal with these constraints. The first is to persuade the US to let China sort out its problems with its neighbors without Washington’s overt or covert interference. If this were to happen, Beijing might not have much problem “persuading” its neighbors to see things China’s way.

However, this is unlikely. Therefore, there is no way for China to test this hypothesis since the US is not vacating the region to allow China’s power games.

The second way is to tell its neighbors, in no uncertain terms, that contesting China’s sovereignty claims might mean exclusion from beneficial economic relations with China. Their strategic tilt against China, as part of closer ties and a security alliance with the US could, therefore, cost them dearly.

Australia has clearly received this message. In an editorial late last month, the Sydney Morning Herald wrote: “Cui Liru [崔立如], the head of the Institute of Contemporary International Relations in Beijing, warned that the economic relationship could not mask the strategic divide with China.”

“The underlying message was that Australia would have to catch up with the reality of growing Chinese power,” it said.

No doubt, similar messages are being conveyed overtly and covertly to other regional countries that are cozying up to the US.

Will it work? It is hard to say, but so far it is having the opposite effect. China’s flexing of its muscles lately has had the effect of pushing some of these countries into a tighter US embrace, as well as creating bilateral and regional linkages.

Xi’s visit to the US was intended to soften China’s image regarding its regional ambitions. However, the differences with the US remain, as it refuses to acknowledge China’s privileged position in the Pacific.

For instance, on Taiwan, the US is continuing to sell defensive weapons despite China’s insistent pressure against it.

And that applies to the Korean Peninsula too, with the US committed to its alliance with South Korea.

In a sense, China wants to enforce its own Monroe Doctrine in the Pacific area.

If the US were to concede China’s sphere of influence in the region, China’s neighbors would feel vulnerable.

Obviously this is not going to happen, with all signs pointing to US determination to become more active in the Asia-Pacific region.

According to Aaron Friedberg, in his book A Contest for Supremacy: China, America, and the Struggle for Mastery in Asia, China’s goal is “to displace the United States as the dominant player in East Asia, and perhaps to extrude it from the region altogether.”

As for any common ground on international issues, the currently hot issues of Iran and Syria are a matter of contention. While supportive of nuclear non-proliferation, China is not keen on becoming part of a strict US-sponsored regime of comprehensive economic sanctions.

On Syria, China, along with Russia, has vetoed the UN Security Council resolution to condemn the regime’s bloody crackdown on its own people.

Another issue clouding the US-China relationship is North Korea’s nuclear ambitions. There is some hope Pyongyang might put a moratorium on its nuclear program in exchange for US food aid.

China has been playing a helpful role with its Beijing-sponsored on-off six-party talks on the North Korean nuclear issue, but has resisted putting decisive pressure on its North Korean ally.

At the global level, China lacks commensurate clout in the existing international order designed and shaped, after World War II, by the US and its Western allies.

However, over the past few years, the global financial crisis has caused the US to appear a bit wobbly, giving China —its major creditor — a lift in global status.

At the same time, Europe is limping, with the eurozone racked with debts.

With the US and Europe in economic difficulties, China will seek to change international economic institutions to its advantage using its financial power.

However, it is still a long way to go for China.

Even with all the US’ economic problems, the US dollar still remains the world’s reserve currency, and when the economic news is bad, there is still a rush toward the US dollar as a dependable asset.

Even China is heavily invested in US bonds and US Treasury notes.

Therefore, it is too early to say China will replace the US as the world’s superpower.

Considering the increasing social unrest and other domestic problems, including its slowing economy, it could take China a long time, if ever, to become the world’s top dog.

Sushil Seth is a commentator based in Australia.