Chapter 3 - China and East
Asia—good neighbours
Holding high the banner of peace, development and cooperation, China
will adhere to the principle of building good-neighbourly relations and
partnerships with neighbouring countries and promote the policy of building an
amicable, peaceful and prosperous neighbourhood. China
will actively participate in and promote Asia's regional
cooperation, closely combine its development with the rejuvenation of Asia
and integrate the maintenance of its own interests with the promotion of the
common interests of all countries in Asia.[75]
Introduction
3.1
China's
emergence as a major economic and political force is having a profound
influence on its neighbours in East Asia. The strength
of the Chinese economy and its potential economic power in the future has
contributed to China's
capacity to exert a greater political influence in the region. With China's
emergence as a manufacturing powerhouse and untapped consumer market, countries
across the Asia-Pacific region, including Australia,
view China's
booming economy as a source of significant economic opportunities. The
willingness of these countries to become politically closer to China
in order to secure the benefits of their economic strength is providing China
with considerable political leverage in the Asia-Pacific region and beyond. The
Secretary General of ASEAN, Mr H.E. Ong
Keng Yong
has noted:
While it is easy and tempting to see China's
rise as an economic threat, it would also be a mistake to do so. A rapidly
growing China
is the engine which powers regional economies and the global economic train.
ASEAN member countries will benefit greatly, provided they adapt fast enough to
ride on the train. Indeed, increased trade with China
was one reason why many of the crisis-hit economies in ASEAN recovered as
quickly as they did [from the Asian financial crisis].[76]
3.2
Although highlighting the opportunities China
will offer to its neighbours, he also touched on both the challenges and risks
created by China's
rapidly expanding economy. Against this backdrop, the committee considers China's
foreign policy and its interaction with countries in East Asia.
This chapter looks at China's
bilateral relations and its involvement in regional fora before taking account
of the influence that China's
foreign policy in the region has on Australia's
interests. This chapter does not examine China's
relations with Japan
or North Korea,
which are considered later in separate chapters.
Regional stability a priority
3.3
China
needs regional stability to maintain the overall health of its economy and to
achieve the status of a first world nation.[77]
Disruptions or political upheavals in the region would not only threaten the
supply of China's
essential energy sources, but would jeopardise trade within the region and deter
vital foreign investment into China.
This situation would be hazardous not only to the Chinese economy, but to
social stability and ultimately the country's leadership. As noted in the
previous chapter, Chinese leaders constantly emphasise the importance of a
stable and cooperative regional environment to their country's economic
wellbeing and their own political legitimacy:
If there is one statement that has been reiterated without
variation from Deng to Jiang to Hu it is that China
needs a peaceful regional and international environment in order that it can
concentrate on domestic development, including shoring up growth patterns and
employment levels. The legitimacy of Chinese Communist Party (CCP) rule rests
on the ability to maintain high levels of economic growth, perhaps linked now
to a better quality of life.[78]
Chinese soft power in East
Asia—peace, progress and cooperation
3.4
The Chinese leadership is therefore actively using the
political and diplomatic tools at its disposal to ensure regional stability
continues. In recent years, China
has presented itself as the 'good neighbour' in a concerted effort to ensure
its intentions, policies and acts are interpreted elsewhere as well-meaning. China
is hoping to convince its neighbours that they should take a common path toward
realising mutually beneficial goals. Chinese leaders want other countries in
the region to aspire to increased prosperity through cooperation and
partnership with China.
It wants its neighbours to celebrate its achievements and to appreciate that China's
national interests dovetail with those of the region. In his most recent
declaration of friendliness toward the region, Premier Wen stated:
China
will never seek domination in East Asia. China
will not develop at the expense of others, and its development will not
threaten any other country...
No matter what may happen in the international arena, China
will remain a trustworthy and reliable partner of the people of the region.[79]
3.5
Mr Kuik
Cheng-Chwee has noted that China
stands to derive significant benefit from positioning itself as a 'good
neighbour':
For China,
this newly emerged image is not just an end in itself. Rather, it is an
effective means for Beijing to
materialize its foreign policy goals. Cultivating a responsible image is a sine
qua non for China's
efforts to alleviate the China
threat theory, to expand its influence, as well as to construct a favourable
regional order.[80]
3.6
Indeed, Professor
Yu Xintian,
President of the Shanghai Institute of International Studies, expressed at a
public seminar in Jakarta that China
would like to co-exist with other countries, and other countries would
hopefully welcome China's
peaceful rise. She explained further:
China
can only rise together with other Asian nations, not alone. Thus China
should not be seen as a scary face in the development of Asia.[81]
3.7
China's
foreign policy is attempting to win the confidence of its neighbours. One
analyst described China's
diplomatic skill and grace as 'a thing of beauty'.[82] Most commentators and witnesses before
the committee agreed with the view that China
has assumed a more active role within East Asia, and
furthermore, that its contribution has been constructive.[83] The Department of Foreign Affairs and
Trade (DFAT) summarised this viewpoint:
China,
like other countries, employs a mix of bilateral, regional and multilateral
strategies to further its national interests, and it is does so increasingly
effectively. I think it is true to say that it is only in relatively recent
times that China has developed the broad based expertise that it has now to
deal effectively in all of those different institutions—regional, multilateral
and bilateral— that it is now a part of.[84]
3.8
Although China
is at pains to stress its opposition to hegemony, power politics, and terrorism
in all its manifestations, it has a major challenge in allaying fears that more
ambitious and selfish motives underpin its 'peaceful development'.[85] It accepts that some harbour
suspicions about China's
intentions. For example Madam Fu
has noted that:
Others suspect that, while the US
is busily engaged in its war against terror, China
is expanding the sphere of influence for strategic rivalry with the US.
Some even concern that China
might seek hegemony in the region.[86]
3.9
China
is working to dispel this perception in the region through both bilateral and
multilateral means.
Active bilateral engagement with East Asia countries
3.10
For three decades following the Second World War, China's
neighbours had cause to distrust it.[87]
During the 1950s and 1960s, a number of countries in the region, such as Indonesia,
Malaysia, Singapore,
Thailand and
the Philippines,
waged internal counter-insurgency wars against communist groups that were
supported politically and financially by China.
One analyst has written that:
China's military predominance, its support for communist
insurgent groups in the region, and its fallout with Vietnam, therefore
resulted in the general perception of China as a powerful destabilising and
disruptive actor in the region, which posed both an ideological and security
threat.[88]
3.11
Two other commentators have made similar observations:
The virulence of the riots against ethnic Chinese in Malaysia
in 1969 was due in part to revelations that Malaysian communists were supported
by the PRC. Thailand
and Burma both
struggled with communist insurgency movements backed by Beijing.[89]
3.12
Indonesia,
in particular, experienced a year of internal upheaval in the mid-1960s after
an attempted coup by the Chinese-supported Indonesian communist party.
Discrimination against Indonesian ethnic Chinese, including a ban on all
publications containing Chinese characters, was in place for decades.[90]
3.13
China's
relations with these countries began to improve during the 1980s as China
opened up to the outside world and adopted a friendly stance toward its
neighbours. Underlying tensions, however, continue to surface over territorial
disputes. These quarrels are mainly centred in the South China Sea
where China
contests claims with Brunei,
Malaysia, the Philippines
and Vietnam
over the Spratly Islands
and with Indonesia
over the territorial waters of the Natuna
Islands. Japan
and China are
in dispute over the Senkaku Islands
and East China Sea energy exploration.[91] China
also has disagreements with some neighbours over border questions.[92]
3.14
Generally, trade links have paved the way for greater
political understanding between China
and its neighbours by helping China
to win trust and eliminate past suspicions. In particular, the Asian financial
crisis provided China
with an opportunity to demonstrate leadership in the region and a commitment to
building a secure and prosperous region. Its assistance has been openly
recognised by ASEAN leaders who, in a joint statement, expressed their
appreciation of China's
contribution to the financing packages in the region. They reaffirmed 'the
importance of enhanced cooperation on economic and financial issues between the
Finance Ministers of ASEAN and the People's Republic of China'.[93]
3.15
Similarly, Hunt and Hunt Lawyers submitted to the
committee that China's
role during the Asian economic crisis was constructive. They stated:
During the Asian financial crisis China's
decision not to devalue the Chinese currency played a considerable part in
limiting economic impact of the financial crisis in Asia.
It should be recognised that this decision by the Chinese Government was
courageous as it created some risks in terms of the Chinese domestic economy
but reflected consideration of the broader impact of such a decision rather
than self-interest.[94]
3.16
Mr Raymond Lim, then Singaporean Minister of State for
Foreign Affairs and Trade and Industry, remarked in February 2004 that China's
'"prosper thy neighbour" thinking is not only forward-looking but
also contributes to regional integration, stability and prosperity'.[95]
3.17
China
is energetically and deliberately cultivating better relations that go beyond
trade links with the countries of East Asia. For
example, Chinese President Hu,
accompanied by Foreign Minister Li
Zhaoxing, visited Brunei,
Indonesia and
the Philippines
in April 2005. According to Mr Li:
During this visit...nearly 30 cooperative agreements have been
signed covering such fields as politics, economy, trade, security, science,
technology, culture, health, disaster relief, personnel exchange and the
exchanges between civilians. In the field of economic and trade cooperation,
President Hu particularly pointed out that trade volume between China and
Brunei is expected to reach US$1 billion by 2010, the bilateral trade volume
between China and Indonesia will reach US$20 billion within 2 or 3 years and
the trade volume between China and the Philippines will reach US$30 billion by
2010.[96]
3.18
He observed that friendly and mutually beneficial
cooperation is certain to inject new vitalities into China's
relations with the three countries and benefit the people and development of
these nations. [97]
3.19
The President of Indonesia, Dr
Susilo Bambang
Yudhoyono, reciprocated with a visit to China
in July 2005. He thanked the Chinese government and people for their assistance
in the wake of the tsunami and earthquake disaster in Aceh and North
Sumatra and for China's
participation in assisting Indonesia's
infrastructure development through the provision of grants and concessional
loans. The leaders of both countries highlighted the importance of strengthening
cooperation, particularly in capacity building and technical assistance in
combating terrorism and transnational organised crimes. They gave commitments
to intensify bilateral cooperation in the defence and military fields and
signed five documents covering a range of activities that would 'give substance
to the implementation of the Joint Declaration on Strategic Partnership between
the Republic of Indonesia
and the People's Republic of China'.[98]
3.20
These two high level visits and the agreements reached
during the meetings are indicative of the high priority China
places on developing and strengthening bilateral ties with its neighbours.
Although it is beyond the scope of this inquiry to consider in detail the
extensive nature and effect of this public diplomacy on all countries in East
Asia, it is clear that China
has enthusiastically and successfully fostered sound relations with its
neighbours. It is equally clear that the countries of East Asia
welcome the opportunity to engage with China
in high-level exchanges and wide-ranging talks to improve cooperation in
politics, trade, cultural activities and military and security matters.
China's new
multilateralism/multilateral framework
3.21
Alongside its bilateral endeavours to forge friendly
relations, China
is also supporting regional political and economic structures. China
has now adopted a pragmatic approach to the prevalence of multilateral fora
operating within the region and is using the same 'peaceful development' stance
in its relationship with such groups. As part of its new security concept, China
has abandoned the notion that participation in multilateral fora will impinge
on or curb its independence. It embraces involvement in multilateral
arrangements, actively espousing the potential for mutual benefit through
cooperation and frequent dialogue. This approach has led China
to participate—often taking the lead—in a number of multilateral fora on
economic and security issues.
3.22
Most notably these include China
as an ASEAN dialogue partner, the ASEAN+3 grouping (ASEAN plus China,
Japan and South
Korea),[99]
the ASEAN Regional Forum (ARF), the Asia-Pacific Economic Cooperation (APEC)
forum and, most recently, the East Asia Summit (EAS). By participating in, and
helping to, guide their direction, China
is able to use these fora as a diplomatic platform to advance its own
interests. From China's
perspective, these bodies are:
...the best means of ensuring [a] peaceful regional environment:
they help to promote economic exchanges that assist with China's
economic development, and they help to reassure Beijing's
neighbours about the strategic consequences of China's
rising power, thus encouraging political and economic cooperation.[100]
3.23
China's
growing and active engagement with ASEAN and associated fora in East
Asia allows it to exercise a greater degree of influence through
the use of soft power diplomacy. On numerous occasions, however, China
has stated that it does not seek a leadership role in regional co-operation and
that China's
support to ASEAN is 'sincere without any political strings attached'.[101] Most recently, Premier Wen asserted
that China's
rapid economic rise spells an opportunity, not a threat to the rest of East
Asia.[102]
3.24
He used the ASEAN Summit in 2005 to underline China's
message to its neighbours that 'all the countries in this region are equal
members of the East Asian family'.[103]
As noted earlier, despite countries in the region welcoming China's
increasing involvement in regional institutions, there are some who are
troubled by China's
growing presence, especially with respect to the shifting balance of influence
in the region between China
and the United States.
This issue is discussed at length in Chapter 5.
3.25
China's
multilateral approach is best exemplified in its relations with ASEAN.
China and ASEAN
3.26
As noted in paragraphs 3.10–3.12, China's
relations with the ASEAN countries have not been easy over the past decades.[104] Mr H.E. Ong
Keng Yong,
Secretary General of ASEAN, noted that the relationship has had 'its ups and
downs'. He stated:
Before ties between ASEAN and China
were formally established in 1991, they were marked by mutual suspicion,
mistrust and animosity largely because of China's
support for the communist parties in ASEAN countries.
The normalisation of relations with China
in 1990 by Indonesia
and then Singapore
and Brunei Darussalam acted as a catalyst to set the path for China's
admission into the ASEAN Regional Forum (ARF) in 1994 and eventually the
granting of ASEAN dialogue partnership in 1996. Since then, the partnership
grew from strength to strength resulting in the expansion and deepening of
cooperation in the economic, political and security, social and cultural and
development cooperation areas.[105]
3.27
In 1997, a year after China was accorded full Dialogue
Partner status of ASEAN, the leaders of the member states of ASEAN and the
People's Republic of China agreed that the consolidation of their developing
relations 'served the fundamental interests of their respective peoples as well
as the peace, stability and prosperity of the Asia-Pacific region'.[106] This move toward greater cooperation
included developing closer economic relations by 'promoting trade and
investment, facilitating market access, improving the flow of technology and
enhancing the flow of and access to trade and investment related information'.[107]
3.28
Indeed, since that time, the ASEAN countries and China
have consistently worked together to improve their relations. In November 2002,
China and ASEAN
signed the Declaration on the Conduct of Partes in the South China
Sea. This document demonstrated a common desire to maintain
stability and carry out cooperation in the region. The parties undertook to
resolve their territorial and jurisdictional disputes by peaceful means and to
refrain from taking actions that would complicate or escalate disputes. The
emphasis was on promoting mutual trust through dialogue.[108]
3.29
Most recently, the ASEAN–China Eminent Persons Group,
established in 2004, produced a report which recommended that in 'the next 15
years and beyond, ASEAN and China
should strengthen and deepen their strategic partnership on all fronts with
focus on economic, political security, social and cultural cooperation'.[109] Former diplomat and Australian
Ambassador to the PRC, Mr Garry
Woodard, told the committee:
China now has far better relations than we do with practically all the
governments of Asia; it certainly has more intricate and better
developed
relationships. Their diplomacy now is extremely skilful, whereas it was rather
awkward in those early days. China is now a
member—indeed, in regard to political dialogue, the leading member—of regional
institutions in Asia, some of which we are not yet in. That
change is absolutely radical.[110]
3.30
Although at times criticised for its lack of concrete
action, many commentators recognise the contribution that ASEAN has made to
regional stability. The Singaporean Minister for Foreign Affairs, Mr
George Yeo, suggested
that people:
...take a step back and look at ASEAN in its historical
development. It has been very good for all of Southeast Asia...a weak ASEAN would
mean that Southeast Asia would be balkanized and new security problems will
appear.[111]
3.31
Professor Stuart
Harris, a China
specialist in the Department of International Relations at the Research School
of Pacific and Asian Studies (ANU), has argued that the success of ASEAN is not
fully appreciated. Even though it does not appear to have achieved significant
concrete results on paper, he noted that ASEAN had been 'one of the most
successful arrangements ever, because all of those countries would otherwise
have gone to war with each other'. He noted that 'they have all got disputed
borders and a range of conflicts—ethnic and whatever'. He stated:
I think the process of multilateralism is not meant to give you
easy results quickly; it is supposed to get you thinking along somewhat similar
lines, exchanging information, getting some sense out of them that you
understand what they are thinking and why they are thinking that, trying to
persuade them, trying to get expectations coming together and eventually
building norms. It is a long, slow process, but we spent ages doing it
bilaterally, and it does not work anyway.[112]
3.32
Professor William
Tow, Director of the International Studies
Program at the University of Queensland,
agreed with this view stating that ASEAN has been useful because it
'essentially has been a conflict prevention mechanism'.[113]
3.33
The effectiveness of ASEAN as a multilateral force is
set to improve with the prospect of a trade agreement with China.
At the moment, China
is ASEAN's fourth largest trading partner and vice versa.[114]
ASEAN Free Trade Agreement
3.34
One of China's
most significant recent multilateral initiatives has been the decision to
negotiate and implement a China-ASEAN free trade agreement (ACFTA). At the
ASEAN summit in November 2000, Chinese and ASEAN leaders agreed to begin the
process of establishing a free trade area between China
and ASEAN.[115] At the next summit,
held on 6 November 2001,
leaders of ASEAN and China
decided to work toward an ACFTA within ten years.[116] A year later they concluded a
Framework Agreement on Economic Co-operation including a commitment 'to
negotiate expeditiously in order to establish an ASEAN–China FTA within 10
years, and to strengthen and enhance economic co-operation through a number of
trade liberalisation measures'. They included:
- progressive
elimination of tariffs and non-tariff barriers in substantially all trade
in goods;
- progressive
liberalisation of trade in services with substantial sectoral coverage;
- establishment of an
open and competitive investment regime that facilitates and promotes
investment within the ASEAN–China FTA; and
- establishment of
effective trade and investment facilitation measures, including, but not
limited to, simplification of customs procedures and development of mutual
recognition arrangements.[117]
3.35
To date, progress towards realising the objectives set
by the proposed FTA appears promising. In October 2004, the Secretary General
of ASEAN told an audience:
The establishment of ACFTA by 2010 looks set to enhance economic
cooperation and integration between ASEAN and China.
The market and purchasing power are very much enlarged by the FTA. Preliminary
estimates suggest that the ASEAN-China FTA would raise ASEAN's exports to China
by 48% and China's
export to ASEAN, by 51%. At the same time, the combined GDP of ASEAN would
expand by at least US$1 billion while that of China,
by some US$ 2.3 billion (Note assuming a 6% annual growth rate in ASEAN and 7%
in China).[118]
3.36
More recent trade figures continue to show cause for
optimism. For the period 2002–2004, bilateral trade grew at an annual rate of
38.9 per cent, reaching US$105.9 billion in 2004. During the first half of 2005
it grew to US$59.76 billion. For 2004, Chinese investments to ASEAN grew by 20
per cent to US$226 million.[119] In October
2005, the Secretary General of ASEAN remarked that:
These encouraging figures could, therefore, only improve as
ASEAN and China
realise all the agreements envisaged under the Free Trade Area.
The prospects for trade and investment between ASEAN and China
are bright as policies that are directed towards closer economic integration
and conducive to doing business are realised.[120]
3.37
The ACFTA represents a significant cooperative
initiative that bolsters China's
soft power. Once the economies of ASEAN become further intertwined with the
Chinese economy, regional security interests will likewise converge.
Essentially, ASEAN member states will be drawn more tightly into China's
orbit of influence. Additionally, the agreement will assist China
with its energy needs, contributing further to its capacity for economic growth
and hence its ability to spread political influence and continue its process of
military modernisation.
3.38
In addressing the China–ASEAN Free Trade Agreement, Reg
Little and James Flowers were of the view that the arrangement is 'likely to be
little more than a stepping stone to closer China-led regional cooperation,
designed to protect against a repeat of the 1997 Asian financial crisis and
against regional groupings in Europe and the Americas'. In their submission
they stated:
It is hard to see how Australia
can protect and advance its interests except by displaying a preparedness to
respond constructively to developments of this nature. It is likely to best
optimize its negotiating position if it is playing a pro-active, strategic role
that is built on an astute understanding of regional interactions and regional
sensitivities about the influence of non-regional and alien cultural norms.[121]
The importance of Australia's
engagement with major regional institutions is discussed more fully later in
this chapter.
ASEAN plus three
3.39
China
is also a member of the ASEAN+3 group, which has brought together leaders of
the 10 ASEAN member states and China,
Japan and South
Korea. The first ASEAN+3 Summit
was held in 1997. At this meeting, China's
President and leaders of ASEAN undertook to promote good-neighbourly and
friendly relations, increase high-level exchanges and strengthen dialogue and
cooperation in all areas 'to enhance understanding and mutual benefit'.[122]
3.40
By 2002, the process had matured and expanded to
include 'regional political and security issues such as the fight against
terrorism and transnational crime'. The leaders also expressed a willingness to
'explore the phased evolution of the ASEAN+3 summit into an East Asian summit'.[123]
3.41
At the 8th ASEAN+3 Summit
in November 2004, the leaders reiterated their determination to make concerted
efforts to fight terrorism in East Asia. They reaffirmed
their commitment 'to a peaceful and comprehensive solution to the nuclear issue
on the Korean Peninsular and the necessity to engage in dialogue to promote
mutual confidence and common approach'.[124]
They also discussed positive actions taken by the group including energy
cooperation and the establishment of the ASEAN+3 unit in the ASEAN secretariat.
The leaders also recognised the need to develop the Asian bond market and to
introduce mechanisms to combat emerging diseases. Their support of the ASEAN
Leaders' agreement to convene the first East Asia Summit (EAS) in Malaysia
in 2005 was a notable milestone in the evolution of the concept of an East
Asian community. [125]
3.42
In December 2004, the Prime Minister of Malaysia, the Hon
Abdullah Ahmad
Badawi, announced that although East
Asia as a community had been a work in progress for some time it
was 'no longer an idealism'.[126] He
noted that there were now 48 ASEAN+3 forums, ranging from the leadership
summits down to expert-groups covering many subjects of common interest.[127] Indeed, according to Premier Wen,
ASEAN+3 had become 'the most dynamic and promising regional cooperation
mechanism in Asia'.[128]
3.43
During 2005, however, there was a cooling in the
relationship between China
and Japan,
aggravated in particular by the Japanese Prime Minister's visit to the Yasukuni
shrine. In December, China
withdrew from the trilateral annual meeting with Japan
and the Republic of Korea (ROK) that was usually held on the sidelines of the
ASEAN Summit. In reference to Japan,
a Chinese spokesperson announced that China
hoped that 'the country in question will create proper atmosphere and condition
for stronger tripartite cooperation'.[129]
This matter is considered further in chapter 7.
ASEAN Regional Forum (ARF)
3.44
The ASEAN Regional Forum (ARF) is another key
multilateral forum in East Asia. It is the primary regional
group concentrating on security. It places emphasis on the peaceful settlement
of differences and conflicts between states through dialogue and negotiations.[130]
3.45
In 1994, ASEAN and its dialogue partners decided to
establish the ARF to facilitate multilateral consultations, confidence building
and the prevention of conflict. Forum participants included China
as a 'consultative partner' of ASEAN.
3.46
According to ASEAN members, the ARF has taken an
evolutionary approach since its inception, incorporating 'the promotion of
confidence building among participants, the development of preventive diplomacy
and the elaboration of approaches to conflicts'. It argues that this approach
enables participants 'to deal constructively with political and security issues
that bear on regional peace and stability, including new issues that have
emerged as a result of globalisation'.[131]
In its view, the ARF is the principal consultative and cooperative forum for
political and security matters in the Asia-Pacific.[132]
3.47
China
attaches great importance to, and actively participates in, the ARF. Since
1997, it has hosted two inter-sessional meetings on confidence building
measures and undertaken eight confidence building programs, including training
courses on Chinese security policies and seminars on military logistics support
and strengthening cooperation in non-traditional security issues.[133] China is using this forum to promote
its message that it is serious about working 'to maintain a peaceful and stable
international environment as well the good neighbourly surroundings' in the
region.[134] China's
soft power gains from its participation in the ARF have been noted:
Beijing has seen the value of the ARF...in providing it with a
venue to explain its point of view, ensuring that its interests are not
overridden, and assisting with the building of security cooperation rather than
exacerbating the security dilemma. These have been matters of major importance
given that the Chinese leadership has been engaged in a process designed to
undercut the 'China
threat' argument in the context of its rising power.[135]
3.48
China
has proposed a number of initiatives that have been approved by the ARF foreign
ministers' meetings. For example, in 2003 it proposed the convening of an ARF
Security Policy Conference in which high military officials as well as
government officers would be invited to participate.[136] The first meeting of the new
conference was held in Beijing in
November 2004. It recommended that the conference explore and develop ways and
means of cooperating bilaterally and multilaterally in areas such as
'intelligence and information sharing, capacity building, training programmes,
consequence management, sharing experience on legal aspects on the role of
armed forces in dealing with non-traditional security issues'.[137] A second conference was held in Vientiane,
Laos, in May
2005.[138]
3.49
Some question the effectiveness of the ARF. Professor
Paul Dibb,
Director of the Strategic and Defence Studies Centre at the Australian
National University,
observed that it was little more then 'a karaoke-singing talk shop'. He noted
in evidence that:
In this part of the world, unlike in Europe,
there are no overarching arms control agreements at all. There are no
disarmament agreements at all. There are no naval incidents at sea agreements
at all. There are no open skies agreements at all. The West had those with the Soviet
Union at the height of the Cold War.[139]
3.50
Appreciating that multilateralism is slow to produce
concrete results, Professor Harris
saw the ARF in a positive light. He noted that Japan
and America
perceive China
as a threat, and referred to the military posturing that goes on in the region.
In his view:
It may take a long time to get anywhere, but it may be that the
way you get information out of them is by reassuring them on some of their
suspicions and getting a better idea of what they are doing. I think we have
moved some way down the track with the ARF.[140]
3.51
Mr Garry
Woodard took the same approach. He noted:
...the more China
is conducting dialogue with other countries and is promoting cooperation with
other countries and is developing a normative framework of agreement with regard
to matters like security and non-interference and so on, the better it is for Australia
and for the world generally.[141]
Committee
view
3.52
The committee recognises that the ARF plays an
important role in making it easier for members to talk about regional security
issues, as well as more generally assisting to foster mutual understanding in
the Asia-Pacific region.
Asia Pacific Economic Cooperation
3.53
The Asia Pacific Economic Cooperation (APEC) forum is a
much larger grouping in the region that comprises 21 member states, including
the United States
and China.[142] The following section considers the
significance of APEC as a regional forum.
3.54
In 1989, the then Australian Prime Minister, the Hon
Bob Hawke,
proposed a meeting of regional countries to discuss the creation of a more
formal inter-governmental forum for regional cooperation. After a period of
intense diplomatic activity, 26 ministers from twelve regional economies
gathered in Canberra to talk about
their shared economic future. The forum was called the Asia Pacific Economic
Cooperation.
3.55
From its inception, participants in APEC shared the
basic understanding that it would be an informal consensus-building body,
sensitive to the cultural, political and economic diversity among its members.
In 1993, APEC gained greater international credibility and authority when the
leaders of the member economies met as part of the APEC process. This leaders'
meeting is now an annual event.
3.56
Since then, this informal group of economies has grown
into an important regional forum of members who share a commitment to free and
open trade in the region. In working towards this goal, members have
established strong links and developed a better understanding and appreciation
of the diversity among member countries. Although tensions still exist between
some members, APEC has nurtured a sense of community in the region and has set
down a substantial sub-structure of economic cooperation.[143]
3.57
Until recently, APEC had rejected attempts to broaden
its mandate to include security issues. Changing world events, however, have
drawn APEC into security matters. DFAT explained to the committee:
...APEC has been evolving...over the last several years. You saw in
the early period of APEC’s development a focus on a set of trade and economic
issues but not really a security agenda. You have seen over the last decade,
increasingly, APEC members recognising that the division between economic prosperity
and security is a very hard one to define. So, with the unfortunate rise in
global terrorism and the threat that poses to economic development, APEC
leaders have increasingly shown their willingness to address security issues. China
has been part of that.
At the APEC leaders meeting in Mexico
a couple of years ago, there was agreement on a statement expressing concern
about the DPRK and its nuclear activities. We have seen statements condemning
terrorism. We have seen agreement on limiting the spread of MANPADS throughout
the Asia-Pacific region. They have all come out of APEC meetings. I think we
have worked pretty hard to ensure that China
is engaged within APEC. It is one of more than 20 members, as you know, and
APEC does not revolve around China;
it revolves around the broader membership. Of course China
is an important part of that.[144]
3.58
More recently, the Australian Prime Minister, the Hon.
John Howard,
noted the inclusion of security issues on APEC's agenda since the September 11
attack in New York, with 'major
initiatives on counter-terrorism and travel security'.[145]
3.59
APEC, however, has been dogged for many years by
criticism that it is a political 'talk-fest'.[146]
Dr Hadi Soesastro,
executive director of Jakarta's
Center for Strategic and International Studies, noted that APEC had become
'unwieldy'.[147] Before the 2004 APEC
leaders' meeting, the Australian Prime Minister stated that he did not sense that
'we will be treading water' in a way that he felt was the case on a number of
occasions in recent years.[148] In
October 2005, the Lowy Institute observed that APEC is 'balanced on the brink
of terminal irrelevance'. It noted that APEC's reputation among journalists,
officials and academics is 'sagging' and even those directly engaged in APEC
activities do not seem able 'to muster much enthusiasm for it'.[149]
3.60
Professor Dibb
argued that Australia
should try to reinvigorate APEC 'not least because of its huge economic
content, and the fact that leaders meet and the United
States is in it'. He stated:
I think APEC has become, again, something of a talking shop and
a bit boring. It needs some usefulness put into it. If Australia
can talk to America
about that it would, in my view, be extremely good.[150]
3.61
DFAT officers told the committee that it was sometimes
easy for people to be critical of APEC because 'it perhaps does not produce a
huge number of headlines every time there is a leaders' meeting'. He noted,
however, that:
...if you look over the period of time since APEC was established,
its track record stands up pretty well against other regional and multilateral
institutions in terms of achievements that it has made.[151]
3.62
Although APEC may be seen to be slow in achieving its
stated goals of free and open trade in the region, this informal group has
grown into an important regional forum of 21 members who share a bold
commitment to economic cooperation. It has nurtured a sense of community in the
region and has laid substantial foundations for economic cooperation. Its value
as a regional forum cannot be underestimated and its influence has spread
beyond the boundaries of economics and trade. In 2000, the Senate Foreign
Affairs, Defence and Trade References Committee
found that:
Over the years, through dialogue and cooperation, APEC had built
up a reservoir of goodwill and understanding between members and established a
wide and deepening network of diplomatic relations.[152]
3.63
Despite concerns that APEC has failed to meet
expectations and its own stated goals, it continues to provide constructive
opportunities for its members to meet and to resolve actual or potential
tensions between them. This aspect of APEC is particularly important for
members such as China,
the United States
and Japan.
East Asia Summit
3.64
The East Asia Summit (EAS) is the most recent
initiative in the development of multilateral fora in East Asia. The EAS concept grew out of a nascent sense
of regionalism in East Asia. Its genesis reaches back to
the early 1990s when the then Malaysian Prime Minister, Dr
Mahathir Mohamad,
proposed the formation of an East Asian Trade Group. It was to include ASEAN
countries, Hong Kong, China,
South Korea, Taiwan,
Japan and economies
in the Indochina area. At that time, Dr Mahathir
argued that Australia
and New Zealand
were part of Australasia and not East Asia,
and since his proposal was to be a geographical grouping, they would not
qualify for membership.[153]
3.65
In 1991, ASEAN Trade Ministers supported the notion of
an East Asian trade group as an ASEAN initiative after Indonesia
proposed successfully that it be known as the East Asian Economic Caucus. At
the ASEAN Ministerial meeting in July 1997, the Foreign Ministers expressed
their hope that the Caucus would be formally instituted for the benefit of
members.
3.66
The idea never really took form until 2000 when the
leaders of the member ASEAN countries, China,
Japan and Korea
agreed to establish an East Asia Study Group. In its final report in 2002, the
group concluded that growing interdependence and the recent financial crisis in
East Asia provided a 'strong impetus for
institutionalizing cooperation in the region'. It recommended that East Asian
countries pursue the evolution of the ASEAN+3 Summit
into an East Asian Summit.[154] The
ASEAN+3 Summit endorsed this
view.
3.67
As noted above, ASEAN leaders took the decisive step in
2004 of agreeing to convene the first East Asia Summit in 2005. The Prime
Minister of Malaysia, Abdullah Ahmad
Badawi, explained that the summit would be
more than a political symbol and should 'carry and drive the process of East
Asia Community Building'.
He stated further:
...an East Asia Summit of Leaders would send a powerful signal of
the existence of trust and confidence among regional countries, something that
our region needs now and something that the world has been waiting to witness.[155]
China's
role in EAS
3.68
Before the first meeting, the Chairman of the 11th
ASEAN Summit made clear that the EAS was to be 'an open and inclusive forum
with ASEAN as the driving force for broad strategic, political, economic issues
of common interest'.[156] Premier Wen
expressed similar sentiments stating that China
opposed the building of 'any self-enclosed or exclusive bloc in the East
Asia region'.[157] He
indicated further, however, that China
did 'not seek a leadership role in regional co-operation'.[158] Indeed, China
publicly expressed support for the leading role of ASEAN in the summit:[159]
ASEAN has been playing a leading role. China
thinks that we should respect the consensus of ASEAN and support its leading
role.[160]
The EAS and Australia
3.69
When Dr Mahathir
first proposed an East Asian trade group, Australia
and the United States
opposed the suggestion because of concerns that such an association might
undermine the effectiveness of APEC. At the time, Australia
was also concerned about being excluded from the group.[161]
3.70
By the time the proposal for an EAS had gained broad
support from the ASEAN countries, Australia
had altered its stance, indicating that it would like to participate in the
summit.[162] In the Prime Minister's
view, it would be 'sensible and logical' for Australia
to be part of the EAS.[163] Australia's
Minister for Foreign Affairs suggested that it would be 'most unfortunate' if Australia
were left out of the summit.[164] He
stated:
...because the East Asia Summit could be a very important
component of building an East Asian community and for Australia to be part of
that right from the beginning is an enormously important development for
Australian diplomacy.[165]
3.71
Singapore,
Indonesia and Japan
actively promoted Australia's
participation in the EAS, as did Vietnam
in May 2005.[166] For example,
Singapore's Minister for Foreign Affairs argued that it was important that the
EAS should not be seen by the U.S., India, Europe and others to be 'an
exclusive East Asian close grouping'. He stated clearly that Singapore
supported the inclusion of India,
Australia and New
Zealand in the EAS, concluding that their
participation would 'keep ASEAN at the centre and put it beyond doubt that we
are externally-oriented and inclusive in our deep construction'.[167]
3.72
China
was initially unenthusiastic in its support for Australia's
involvement in the EAS, but on 18
April 2005 Premier Wen
Jiabao stated:
China
would like to continue to enhance consultation and coordination with Australia
in important international and regional issues in a bid to jointly promote
peace and development of the Asia Pacific. China
welcomes Australia
to play an active role in the regional cooperation within East Asia.[168]
3.73
The following day, the Australian Prime Minister
indicated that China
would support Australia's
inclusion in the East Asia Summit.[169]
He said:
...the Premier expressed stronger views about Australia's
participation than had previously been expressed by China.
And that was a view that was essentially confirmed in a different way by the
President.[170]
3.74
Immediately before the summit, China
was more direct in its support for Australia
and stated clearly that:
China
sticks to the principle of openness and transparency. We oppose the exclusive
cooperation targeting any third party. China
welcomes the attendance of Australia,
India and New
Zealand at the first East Asia Summit. We
are willing to maintain contact and coordination with these countries through
the summit, bring the friendly cooperation between us closer and jointly
promote the peace, development and cooperation in this region.[171]
3.75
In April 2005, ASEAN foreign ministers agreed on the
criteria that would allow India,
Australia and New
Zealand to participate in the summit. As
noted earlier, by including non-East Asian members, the EAS departed from the
original exclusive East Asian grouping envisaged by Dr
Mahathir. According to Mr
Goh Chok Tong,
Prime Minister of the Republic of Singapore,
it was a wise decision: 'It kept East Asia regionalism
inclusive, forward looking and open'.[172]
3.76
Participants to the EAS were required to meet three
conditions—agree to ASEAN's Treaty of Amity and Cooperation (TAC), hold full
dialogue partner status with ASEAN and have substantial economic links with the
region.[173] ASEAN stipulated that Australia
must sign the TAC as a precondition for Australia
attending the inaugural EAS.[174] The
treaty is a code of conduct for inter-state relations and ASEAN's founding
nonaggression pact aimed at promoting regional stability.[175] ASEAN members look upon this treaty
as 'a unique diplomatic instrument for regional confidence-building, preventive
diplomacy, and political and security cooperation.'[176] Signatories renounce using violence
to settle conflicts in the region.
3.77
According to the Prime Minister of Malaysia the treaty
is now 'the de facto East Asian charter for peace and good neighbourliness'.[177] All ASEAN+3 members have acceded to
the treaty, with China
the first non-ASEAN state to do so in October 2003. Notably, this was the first
of its kind that China
had signed with a regional grouping.[178]
3.78
On 27 July
2005, after some initial reluctance, Australia's
Foreign Minister announced that Australia
would be signing the Treaty. He stated:
We are happy with the arrangements that have been made in
relation to the Treaty of Amity and Cooperation and the ASEAN countries made it
clear that that would be a pre-condition for participation in the East Asia
Summit. So laying all these things in the balance and applying a bit of common
sense and wisdom we have come to the conclusion that the best thing is for
Australia, Australia's long term interest not just the interests of the next
two or three years, but our long term interests, is to be a key player in the
East Asia Summit and the emerging East Asian community—I think that is terribly
important for Australia.[179]
3.79
He signed the declaration of intention to accede to TAC
on 28 July 2005 and the
instrument of accession on 10
December 2005. The summit was held on 14 December. Participants
endorsed the position that it would remain open and outward looking and
welcomed Russia's
expression of interest to participate in the EAS. The United
States was not invited to the Summit.
3.80
Members agreed that it would continue to be a
'leaders-led' summit that would meet annually for strategic discussions on key
issues affecting the region and the evolving regional architecture.[180] Derived from the ASEAN+3 grouping,
the focus of the EAS, however, is primarily an economic one. According to
Malaysian Foreign Minister, Syed
Hamid Albar,
its architects are aiming for regional economic integration.[181]
3.81
Mr Peter
Jennings, Director of the Australian Strategic
Policy Institute (ASPI), was optimistic about EAS' potential. He told the
committee that it provides one of the best opportunities 'for the major players
of the region to get together in ways which will make it possible to start
opening up points of transparency about military thinking'.[182] On the other hand, Professor
Dibb was sceptical. He questioned whether
the EAS was a device through which China
could exclude the United States
from the region. He noted that this was the first time that Australia
had joined a regional security organisation without the United
States and concluded: 'We will see whether China
manipulates EAS or whether it is a good multilateral security partner'.[183] Despite these reservations he was of
the view that Australia
must participate in the EAS.[184]
Committee
view
3.82
Australia's
acceptance into the EAS marks a general recognition by East Asian countries,
including China,
that Australia
has an important and constructive place in the region. The exclusion of the United
States from this summit has, however, raised
concerns and ignited debate about the role of the United
States in the region. This matter is
discussed in the following chapter.
EAS and APEC
3.83
As noted earlier, the newly formed EAS has broad
support across the countries of East Asia. Australia,
however, is strongly advocating the importance of APEC. On 12 September 2005,
the Australian Prime Minister told an audience in New York City that 'APEC has
served us well as the pre-eminent regional institution and Australia remains strongly
committed to ensuring that it remains responsive to emerging regional
challenges.'[185] Mr
Jennings of ASPI told the committee that in
his view:
...the Prime Minister was doing a bit of hedging or bandwagoning
himself because he, I think for the first time, started to create a hierarchy
for these things. He described APEC as being ‘the pre-eminent regional
institution’ and he described the East Asian summit as ‘an important
gathering’.[186]
3.84
He believed this statement was intended to send a clear
signal to the United States,
urging them to assume an active role in APEC:
...what the Prime Minister is actually delivering in that speech
is a message to the Americans saying: ‘It’s about time you woke up and put a
bit of substance into the APEC processes if you wish to stay engaged in this
part of the world. And if you’re not, then the East Asian summit will start to
step in and take some of that heavy lifting as far as the security game is
concerned.
3.85
At the time of the EAS Summit, the Prime Minister, Mr
Howard, again stated his belief that APEC
should be the key body:
The premier body in this part of the world should remain APEC
because it crucially brings in countries of South and Central America and of
course the United States...I certainly don't see it [EAS] replacing the premier
role of APEC. I am very pleased that Australia
is part of it but I don't think we should get exaggerated views about its
relevance at this point.[187]
Committee
view
3.86
The committee recognises the significant role that APEC
has in the region not only in facilitating trade but in promoting regional
cooperation, good will and security. It is important for both Australia
and the U.S. to
ensure that APEC remains relevant to members and active in pursuing regional
goals. That said, the committee supports equally the work being done in other
regional fora such as ASEAN, the ARF and the EAS. It believes that they also
have an important place in developing a sense of regional community and warrant
the strongest support from Australia.
Australia and the growing integration of East Asia
3.87
There is a web of economic interdependence developing
in the region in which China
will eventually occupy a central position. With its strong trading links with Japan,
Korea and China,
Australia has a
vested interest in ensuring that the network continues to thrive. The
Australian government has indicated that China's
spreading influence has been constructive and cooperative in its nature. In
evidence to the committee, DFAT stated that:
... as China
develops its linkages within East Asia, it would seek to play a more active role
within East Asian regional architecture. Clearly that is happening, and it
is a constructive development. There is no sense that we have that China’s
engagement in regional institutions that have been created has been as anything
other than a full participant and as a participant that is prepared to discuss
issues constructively and to look at ways in which greater cooperation between
members of the region can be fostered.[188]
3.88
Even so, a more closely integrated economic community
in East and South East Asia means that Australia,
many of whose economic and commercial interests are concentrated in this
region, will have to monitor these developments carefully. Reg Little and James
Flowers observed:
Given current trends, it is becoming imperative to base an
important portion of Australia's
strategic planning on the contingency that China
in particular, and East Asia in general, will re-emerge
at the centre of global trading, first rivalling and later overshadowing
Anglo-American power. In such circumstances, it is apparent that Australian
policy cannot afford to be ill-informed about powerful, deep-rooted cultural
qualities, largely suppressed and disguised over much of the past century, that
direct behaviour among its most powerful neighbours.[189]
3.89
This imperative will increase in importance if there is
further movement towards an Asian trade and financial grouping to match
European and American regional groupings. Australia will not only need to be
closely in tune with developments in China, but also with other key members of
any such grouping so as to ensure it can negotiate from a position of strength.[190]
Recommendation 1
3.90
The committee recommends that the Australian government
demonstrate to East Asian countries a genuine interest in and support for ASEAN
and the ARF, redouble its efforts to reinvigorate APEC and remain fully engaged
with the East Asia Summit.
The committee believes that the Australian government should look upon these
fora as complementary.
3.91
The committee notes that China's
smile strategy or soft power diplomacy is working in the East Asia
region. Together with its growing economic presence in the region, China
is exerting greater influence. However, some view the rise of China
as a threat to the interests of the United
States in the region. The next chapter
examines the bilateral relationship between China
and the United States,
while Chapter 5 considers the repercussions of this relationship for other
countries in the region.
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