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In response, Washington deployed two aircraft carriers to the area, which led to the Chinese backing down. Since the mids, China has undertaken a well-funded program of military modernization. It is an attempt to counter potential American force projection inside the disputed waters of the first island chain. Many nationalist academics now acknowledge that China committed a historic mistake by ignoring the oceans, and that the lack of preparation for naval warfare ultimately led to the humiliations of the nineteenth century.

The Chinese military is building up the capability to deter American operations within East Asia. It could cause a high attrition rate for U. China, in terms of military technology, is still many years behind the Americans and still relies on Russia for most of its high end military equipment, including engines for its fighter aircraft. Although economic warfare would probably work better against present-day globally integrated China than it did in the Cold War against the autarkic Soviet Union, it might, as Robert J Art notes:.

In short, the United States and China are in a mutually assured relationship economically: each can retaliate against economic warfare waged by the other. There are now 80 countries in the world that have China as their biggest trading partner. Trade with China is vital for the prosperity of the countries of the Association of Southeast Asian Nations. Therefore, if the United States and its regional allies fail to create an effective balancing coalition, it could gain dominance by default.

China could feasibly achieve regional hegemony, if only because of its sheer economic size and accompanied military prowess may prove to be unassailable. China had been the hegemonic power in East Asia for centuries before the Europeans and Americans opened the region up for commerce in the nineteenth century. According to offensive realism theory, it is likely that Beijing will make a bid for regional hegemony.

Its behaviour in the East and South China Seas, as well as its military build-up and the rise of nationalism in China itself, make it appear that the process has already started. However, China does not yet have the military capabilities to challenge the United States in a direct confrontation. If Washington can create an effective balancing coalition, Chinese power will be contained. It is not yet a regional hegemon, but if its power continues to grow both economically and militarily, it may prove too much of an irresistible force to contain.

Regional actors may have no choice but to accommodate Beijing for the sake of their own economic survival and for want of capability to counter it militarily. N, Waltz. International Monetary Fund, Office of the Secretary of Defense. Art, R, J. Bayliss, J. Bieler, A. Callahan, W. Chan, G. Cheng, D. Cheng, L, ed. Chung, J, H. Cox, R. De Castro, R, C. Dunne, T. Today, China is a member of more than international organizations and has signed more than multilateral treaties Tsai, China has placed more importance on other cultural values and used cultural identity to strengthen belief in and realization of the harmonious world.

The fourth generation leadership has tried to utilize cultural diplomacy such as the establishment of the Confucius Insti- tute in and the promotion of Chinese language study to advance its foreign policy objectives. The result has not only caused relations among large countries to undergo major adjustment, various forces have also recombined to produce new phe- nomena, especially the continuing development of economic globalization and interde- pendence among states. In contrast to traditional security concerns such as geopolitics, military security and ideology, economics now plays a major role in international rela- tions.

The rapid and efficient integration of China with its neighbors and the interna- tional community is critical for future economic security and international strategic planning. Since stability and prosperity in the Asia-Pacific region is most relevant to the de- velopment of its national interests, China must endeavor to maintain and ensure regional stability as a foundation for economic development.

Economically, China has worked hard towards improving re- lations with East Asian countries by implementing regional trade agreements that bene- fit both China and its neighbors. China promotes cooperation and dialogue among states and peaceful resolution of conflicts to maintain domestic and regional stability.

The promotion of interactive cooperation is an important element of good neighbor policy. China has moved from the isolationist policy of its past towards active participation in multilateral security dialogues Fukushima, China strengthens economic and trade exchanges through bilateral cooperation while making use of existing international mechanisms at the same time. At the 15th Party Congress in , this policy was more clearly iterated Chao and Hsu, If it is not possible to be resolved at once, it may be temporarily put aside; find common ground and save the differences.

Good neighbor diplomacy has become the primary impetus in Chinese diplomacy after Deng Xiaoping. Since China thought multilateral security agreements might be detrimental to its national sovereignty, China did not respond positively to the proposal for creating a multilateral security forum in the Asia-Pacific region that was first put forward in the early s.

Despite these various concerns,2 China ultimately decided to participate in the 30 Journal of Contemporary Eastern Asia, Volume 10, No. Specifically, the re- port stated that China should proactively shape the development of security mechanisms to ensure a favorable position in a fluid and complex security environment. Period of Active Participation - After several years of cautious participation and watchful observation, China gradually changed its perception of multilateral cooperation, and realized that multilateral forums may not necessarily be harmful to its national security.

China gradually participated in ARF activities and other forums for multilateral cooperation in the region. The ARF enables China to participate in regional diplomacy in a way it is comfortable with. Through par- ticipation in various confidence building measure CBM activities, China hoped to re- assure its neighbors and dampen the perception of China as a threat Kuik, At the same time, China persistently stressed the new security concept through ARF and other multilateral occasions.

Leaders from the two sides reached an agreement in the following year to establish free trade within the next ten years. Unlike earlier stages in which Beijing merely responded to ideas put forward by ASEAN, Beijing now entered a new phrase in which it was beginning to ini- tiate bold proposals. China has now begun to move towards a diplomatic strategy of multilateralism, actively promoting security dialogue in the Asia Pacific region and consolidating regional secu- rity through multilateralism.

The overall relationship between China and ASEAN has been transformed from one of suspicion and fear, driven at first by ideology and then largely by ongoing territorial disputes, to one of increasing cooperation and collaboration, particularly in terms of trade. This shift in the geopolitical orientation of Southeast Asia is part of what some see as a larger shift in the international balance of power that puts the rise of Asia in general, and China in particular, on a scale equivalent to the rise of Europe in the 17th century or the rise of the United States at the beginning of the 20th century Vaughn and Morrison, Regarding Southeast Asia, China retains several strategic objectives: 1 reduce great power influence in the region, especially the US; 2 create a strategic buffer zone through friendly state s in the region; 3 protect Chinese territory in the South China Sea.

As the next years is deemed to be a period of strategic opportunity for China to increase economic development and achieve great power status, China hopes to cre- ate a safe and secure regional environment Chambers, ; Yuan, Traditional territorial dis- putes between the two states include issues with the common border between the two states, the Beibu Gulf Northern Bay and the Spratly Islands. An improvement in bilat- eral relations began in when both countries signed a land border treaty, which paved the way for an agreement on the demarcation of territorial waters, the establish- ment of economic zones and the continental shelf of the two countries in the Beibu Gulf and the Beibu Gulf Fishery Cooperation Agreement in the following year.

The agree- ments resolved border issues and demarcation problems in the Beibu Gulf; however, a dispute over the Spratly Islands is a subject of ongoing negotiations. It is clear that China is empha- sizing the resolution of disputes in the South China Sea through bilateral and multilat- eral negotiations Hsu, Since , China has made joint statements with ASEAN on individual issues, demonstrating a gradual expansion in bilateral cooperation on trade related issues with Southeast Asia. China and ASEAN made a joint statement at the commemorative sum- mit in , agreeing to further advance mutual trust and understanding and strengthen strategic partnership.

In the following year, China and ASEAN signed an agreement on trade in service, laying the foundation for the establishment of free trade. Building on these bilateral relations, China has widened its scope of engagement to embrace multi- lateralism, and its official goal is to strengthen economic cooperation and consultation with ASEAN.

China and ASEAN have already established five parallel dialogue mechanisms: senior elite consultation, business council, joint cooperation council, trade council and joint technology council. Accordingly, CAFTA abolished all tariffs between China and Southeast Asia and formalized complete cooperation in politics, se- curity, military, transport, tourism and other areas. China not only actively participates in existing regional multilateral organizations con- sisting of neighboring states, it also voluntarily initiates multilateral cooperative mecha- nisms.

Yanghong Huang and Sheng Ding argue that the rise of China is not simply an hard power expansion. It is accompanied by tremendous efforts to develop soft power, which inevitably reduces US influence Huang and Ding, Chi- nese print media, television, music, food, and popular culture are spreading around Asia as never before. The Beijing Consensus an ideological framework for guiding the organization and growth of developing nations in some ways may already be more popular than the Washington Consensus, as it hints at the possibility of leaders pursuing economic growth and maintaining political authoritarianism at the same time Sutter, ; Sutter, ; Cho and Jeong, Accompanying the rise of China, studies on Chinese history, culture and language have gained popularity worldwide.

China has begun to use this new wave of popularity or zhong guo re to improve its international image. This started with the visit of the USS Bonhomme Richard to Myanmar in November and has been followed with more tangible cooperation. Given the popularity and success of past IMET programs in Myanmar, the administration has considered restoring this program.

However, aware of the resistance to this idea among non-governmental organisations and several members of Congress, officials from the departments of State and Defense by the end of proposed only the adoption of an expanded IMET, or E-IMET, that would focus on education and training in areas such as the civilian control of the military, international human rights law, international humanitarian law, as well as the management of defence resources, and cooperation on counter-narcotics.

The National Defense Authorization Act for fiscal years and similarly limited the scope of US Defense Department activities in relation to Myanmar to consultation, education, and training in relation to human rights, the laws of armed conflict, civilian control of the military, English language, and disaster relief. In the broader context of the end of the Cold War, relations with Washington improved after Vietnam withdrew its troops from Cambodia in September and offered cooperation in the search for American servicemen missing in action during the Vietnam War.

On the economic front, trade relations between the United States and Vietnam resumed in , a year before the formal opening of diplomatic relations. In , Vietnam approved an enterprise law to promote the development of the private sector and, after a serious internal debate within Vietnam over whether to negotiate a Bilateral Trade Agreement BTA with the United States, the BTA was concluded in WTO membership became a tool in the hands of economic reformers to force the pace of change — both to comply with new rules and also to force local industry to compete regionally and globally.

Vietnam faces a similar set of issues as part of its membership in the TPP.

The Obama Administration's Rebalance to Asia

The United States has yet to recognise Vietnam as a market economy and therefore still imposes some barriers to Vietnamese exports. Accession to TPP would make for a significant change to this policy. Vietnam retains a large trade surplus with the United States. As for security ties, though there had been talks between military representatives of both countries even before diplomatic normalisation, defence relations were perfunctory. A week after that visit, the Chinese withdrew the oil rig. In late , the Vietnamese defence minister visited Washington and a US warship made the first port visit to Vietnam in 28 years.

According to the US ambassador to Vietnam at the time, Raymond Burghardt, this was the moment when the two sides began to discuss strategic issues. The US defence secretary visited Hanoi in and In August , the two defence ministries established an annual Defense Policy Dialogue at the vice-ministerial level. Both dialogues have become annual events with much higher profiles.

The second Defense Policy Dialogue, in , generated the Memorandum of Understanding on Advancing Bilateral Defense Cooperation, outlining cooperation in five areas: regularised high-level dialogues, maritime security, search-and-rescue, humanitarian assistance and disaster relief, and peacekeeping.

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The Joint Vision Statement on Defense Relations, signed during the June visit to Vietnam by US Secretary of Defense Ashton Carter, foresees a deepening of defence and security ties, including the possibility of increased defence technology cooperation and trade. The full lifting of the US arms embargo on Vietnam, also announced during that visit, points to some further US defence equipment and weapons exports in the future. O n balance, the United States has seen a number of successes in Southeast Asia and has achieved stronger economic, diplomatic, and security ties in the region over the past decade, and particularly over the past five years.

Nevertheless, looking ahead, the United States faces a number of challenges in advancing the rebalance policy and deepening its strategic presence in the Indo-Pacific. Some of the challenges arise from factors ostensibly unrelated to the rebalance, but which will have an important impact on it.

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For reasons of successor politics alone, the next president will want to put her or his own stamp on foreign policy which could mean new priorities and different policy prescriptions. And to be sure, as in the case of the Obama administration, the next president will have many other pressing priorities to address both at home and abroad. All that said, however, the Indo-Pacific will clearly remain of great strategic significance to the United States for decades to come, all the more so as China continues to grow in military, economic and diplomatic strength.

Indeed, as recent polling demonstrates, Americans place a very high priority on the importance of strong and positive relations with key players in Asia, including China. But in pursuing that engagement, Washington will face a number of challenges within the region. The broad strategic dynamics of the region — while offering compelling opportunities for US engagement — also present significant challenges. As discussed in the preceding pages, throughout the region, and in Southeast Asia in particular, most governments are committed to preventing the emergence of any single hegemon.

Those strategic viewpoints, combined with the deep interdependencies Indo-Pacific countries have with China and the United States, mean they are looking to strike a cautious balance between Beijing and Washington. Some will lean more favourably towards China and others towards the United States, and the degree of preference will differ across varying interests and issues.

This is not necessarily contrary to US interests, but it makes the task of engaging in the region all the more demanding and delicate. Countries such as Indonesia and Vietnam are keen to see these organisations strengthened and for outside powers to work closely with them in the management of regional affairs. Washington would like to see stronger and more effective regional institutions in the Indo-Pacific but these institutions continue to have serious weaknesses.

The current generation of leaders in Southeast Asia appear less committed to the success of these organisations than their predecessors. Economically, the United States is in increasing competition in the region with China. The presence of Chinese goods and capital will likely increase across the Indo-Pacific and in Southeast Asia in particular.

While slowing somewhat, most signs indicate Chinese trade in the region, and particularly exports to China, will continue to see substantial growth, all the more so as low-cost consumer goods manufacturing for the Chinese market moves to other parts of Asia, including Southeast Asia. With growing trade interdependencies and an increased Chinese investment footprint in the Indo-Pacific, and especially in Southeast Asia, some greater Chinese political and diplomatic influence will likely follow.

Beijing will have to contend with the fact that its pledged investments often go unimplemented or, when implemented, are fraught with problems. However, with time, Beijing should be able to better manage much of the negative publicity which has attended its investments in Southeast Asia. The economic centrepiece of the rebalance, the TPP, also faces serious hurdles ahead. Frontrunners for the US presidential race, Hillary Clinton and Donald Trump, have voiced their opposition to the TPP, and this is reflective of an emergent anti-free-trade mood within the US body politic.

A number of key members of Congress have expressed their lack of enthusiasm for the agreement, or at least toward important provisions of it. It appears increasingly unlikely the up or down vote in the Senate to ratify the TPP will take place during the Obama presidency which risks having the agreement re-opened for negotiation within American political circles.

This would likely doom the pact among the other international parties and prevent it from going into effect. Certain bilateral trade and investment relationships are also hobbled by ongoing sanctions and other limitations on doing business. For example, while the Obama administration has taken steps to encourage responsible trade and investment with Myanmar, US firms face a range of difficulties there: high political risk, poor infrastructure, the fact that natural resources are overwhelmingly located in unstable ethnic borderlands, and restrictions on the choice of business partners.

The United States also faces some political constraints to building closer relationships with countries in the region. This is especially true in Southeast Asia where in a number of cases past history and ongoing governance concerns complicate and restrain the US rebalance effort.

JPRI Occasional Paper No. 47

Engaging with the Communist Party of Vietnam is similarly constrained, though the two sides have made some promising steps forward at the political level in recent years. Nevertheless, military-to-military relations are limited and a partial embargo remains on American arms sales to Vietnam. The seizure of power by the military in Thailand has undermined political and military ties between Washington and Bangkok, and these strains are likely to continue for the near-term future. It is worth noting the two-way nature of these political constraints.

In Myanmar, for example, the military leadership remains highly wary of American expectations for political and economic reforms. Hence, these Southeast Asian leaders will urge a go-slow approach and insist on US recognition of their legitimacy. On the security front, most countries in the region enjoy a relatively stable external environment, free of overt threats emanating from their neighbours.

The security concerns of greatest priority for most countries in the Indo-Pacific tend to arise from within their sovereign borders: maintaining economic growth and socio-economic stability, countering religious extremism, and quelling restive ethnic separatism. In Southeast Asia, this is particularly true. This will limit the willingness and capacity of many governments in Southeast Asia to open up strong military-to-military relationships with the United States.

This is all the more so for many governments in the region concerned with provoking China through closer military ties with Washington. Military-to-military ties between the United States and Southeast Asian partners are also often limited owing to ongoing sanctions and other political restrictions. For example, the US National Defense Authorization Act for fiscal year limits Department of Defense activities with Myanmar to consultation, education, and training in relation to human rights, the laws of armed conflict, civilian control of the military, disaster relief, and the English language.

Overall, given past animosities with the United States and concerns that Washington aims to remove the Myanmar military from politics, the leadership of the Myanmar military will remain guarded in its engagement with the Pentagon. In the case of US-Vietnam ties, while relations between the two militaries have markedly improved, nevertheless, even 13 years since military-to-military ties reopened, areas of practical cooperation remain limited.

The June US-Vietnam Joint Vision Statement on Defense Relations calls for deeper security-related ties between the two countries, but progress will be slow owing to political considerations in both capitals. In other security-related cooperation, Washington also committed to assist Vietnam in its nonproliferation efforts through the Cooperative Threat Reduction program and will make the Foreign Military Financing program available to Vietnam which helps countries procure weapons, defence equipment and other defence services from the United States. This is not to say that China enjoys superior advantages over the United States in Southeast Asia nor that China is destined to achieve regional dominance.

Beijing maintains an active diplomatic presence across the region and has generally positive political relations with most of its neighbours, including in Southeast Asia. Even where some bilateral political relations have deteriorated in recent years — as with Myanmar, Vietnam, and the Philippines — these governments are nevertheless cautious to avoid open confrontation with Beijing.

China is able to leverage its good relations with most ASEAN states to assure against any strong consensus within the organisation that might be contrary to Chinese interests. Beijing has also stepped up its military profile in the region through steady modernisation efforts, joint military-to-military activities with regional partners, and greater investments in defence diplomacy.

According to the Asia Maritime Transparency Initiative, if the land features of the Spratly islands are excluded, the nearest Chinese land feature to Mischief Reef is Hainan Island, is nautical miles approximately kilometres away. As discussed in the previous section of this report, China faces many of its own serious obstacles in seeking greater influence in Southeast Asia. Countries in the region do not want to be dominated by a single hegemon and hence welcome a strong and continuing US presence in all of its dimensions.

While they have concerns about a rising China and its longer-term intentions, they have little choice but to seek basically constructive relations with Beijing to the greatest extent possible. Beijing is well aware of these concerns and will carefully manipulate them for greatest advantage over time. T he past eight to ten years have seen a significant expansion of American strategic engagement in the Indo-Pacific region.

Some of the most remarkable advances have been achieved in Southeast Asia, a part of the Indo-Pacific which was too often overlooked in Washington as strategic attention was drawn to Northeast and South Asia or even further afield to the Middle East and Persian Gulf regions. This effort has included the deepening of security-related ties with a number of new and old US partners in the region such as Indonesia, Malaysia, Myanmar, the Philippines, Singapore, and Vietnam.

But the future holds many questions about the strength and nature of a sustained American commitment to strategic engagement in the Indo-Pacific overall and in Southeast Asia in particular. Will the next US administration strengthen American commitments in the region or weaken them in favour of other pressing priorities at home and abroad? Can the two powers expand their collaboration in areas of shared interests?

How adept will Southeast Asian powers prove to be in balancing their relations with Washington and Beijing, and how will this in turn affect US engagement in the region? However, a recurring debate in US grand strategy exists between those advocating deeper engagement in the Indo-Pacific region, and those that argue that the United States is overcommitted, underfunded, and that retrenchment is the preferred option.

Such a strategy does not simply amount to deeper security engagement by the United States with new and old partners in Southeast Asia. In fact, doing so would probably lead to severe overstretch of US resources, particularly at a time when funding and budgetary constraints are most acute.

The engagement needs to be recalibrated in a way that is better targeted and focused and that supports multilateralism where key partners in the region assume greater involvement. Framing the rebalance is the recognition that US engagement of the Asia-Pacific region has been too narrow and the military has borne a disproportionately large burden.

This has included far more assertive and coercive activities in recent years, particularly in the SCS. At times, Southeast Asian powers have used their collective bargaining power to socialise China into a less disruptive power that complies with regional and global norms.

With these points in mind, several important strategic, economic, diplomatic, and security-related principles and policies should be articulated and implemented as high priorities for the US Government now and as a new administration and Congress take office in T he strategic logic underpinning the rebalance has not changed since it was first formally articulated in If anything the reasoning has grown more powerful. In Southeast Asia in particular, a greater US presence is welcomed. It is clearly an American interest and imperative to remain deeply engaged in the region and to strengthen that commitment in the coming years.

A ccess to US markets, investments, and know-how remain powerful attractions in the Indo-Pacific, and especially in the emerging economies of Southeast Asia such as Indonesia, Myanmar, and Vietnam. The TPP trade deal stands out as the most important economic instrument for bolstering US trade and investment in the region. But the TPP is much more than a trade deal.

Strategy in Asia: The past, present, and future of regional security

This is important as Beijing will continue to expand its influence and interests in the region primarily on the back of strong trade relations and a growing strategic investment portfolio across the Indo-Pacific. U S diplomatic engagement is critically important in Southeast Asia as a means to bolster domestic and multilateral institutions in the region which are more accountable, responsive, and effective at home and abroad. Working closely with ASEAN and its individual member states, the United States can promote positive outcomes on the economic, political, security, and social development issues which matter to American interests.

W ashington has established a range of valuable and deepening security partnerships across the Indo-Pacific. Some of the most notable developments in recent years have involved new security ties with countries with which the United States has had troubled relationships in the recent past, such as Indonesia, Malaysia, the Philippines, and Vietnam.

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This is particularly true in Southeast Asia. Only with deep knowledge of the goals, perceptions, hopes, and intentions of Southeast Asian countries themselves can Washington craft policies that further US national interests, help stabilise the region, and sustain the peace and prosperity that has characterised the region for the past three decades. The imperative of such an approach will only grow as Southeast Asia also grows in strategic importance in the years ahead.

So, what does that mean, will Democrats succeed in removing the president and what finally convinced Pelosi to Executive summary The majority of Southeast Asian states welcome a stronger regional presence for the United States.

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This is intended to maximise their strategic autonomy during an uncertain period of intensified great power competition. While Beijing can point to many successes in Southeast Asia, it will continue to face many challenges in achieving greater authority and influence among its nearest neighbours, including in Southeast Asia. The Chinese leadership struggles with balancing its aspirations for regional influence against growing concerns as to its coerciveness in pursuing its interests, especially in the South China Sea.

It is clearly an American interest and imperative to deepen and sustain US strategic engagement in the region, all the more so as China continues to grow in military, economic and diplomatic strength. This will require careful attention to concerns and priorities of partners in Southeast Asia, including in balancing their relations with China. Troublingly, there are signs among US political leaders, including leading contenders for the US presidency, that strategic engagement in Asia may not be a priority.

This part of the report is authored by Dr Evelyn Goh. Suh, Peter J. Katzenstein and Allen Carlson, eds. David I. Goh, Meeting the China Challenge, pp. Goh, Meeting the China Challenge, p. Darren J. This does not preclude consideration of the extent to which Thailand under its current military regime, for example, may restrict US access to Thai bases in a more limited reading of its alliance obligations, or create more substantive military engagement with China.

The key point is that its exclusive mutual defence treaty relationship with the United States is qualitatively different from its security relationship with China, and would oblige a zero-sum choice, should the US and China engage in direct armed conflict. Steinberg, ed. This part of the report is authored by Dr Chin-Hao Huang. New York: Oxford University Press, This part of the report is authored by Dr Bates Gill.

Remarks on the Next Phase of the U. The present study marks the final report for this project.