A near-9 percent dive in China shares sent world stocks and commodity prices tumbling on Monday amidst deepening concerns about a China-led global economic slowdown and crashing commodities prices. This Policy Alert examines reactions from China, India, Russia, South Korea, Japan, and Russia to the ‘Black Monday’ stock turmoil.
Following a poor week that saw an 11-percent drop in its market value, Chinese stocks nosedived again on Monday with the benchmark Shanghai Composite Index plummeting 8.49 percent to close at 3,209.91 points, the sharpest decline in more than eight years. (more…)Continue Reading →
A series of ASEAN meetings including the 22nd ASEAN Regional Forum (ARF) and the 48th ASEAN Foreign Ministers’ Meeting (AMM) took place from August 1-6 in Kuala Lumpur. Concerns over territorial disputes in the South China Sea came under the spotlight at these meetings, with ASEAN’s foreign ministers struggling until the eleventh hour to issue a joint statement. In this Policy Alert, we examine reactions from China, Russia, India, Japan, and South Korea to last week’s ASEAN meetings.
Chinese media defended accusations by other nations regarding China’s land reclamation activities in the South China Sea. (more…)Continue Reading →
For long, Japan-China relations have largely been acrimonious due to historical and territorial factors. Despite strong economic ‘bonhomie’, the two countries have failed to resolve these disputes amicably. The situation could deteriorate further in coming months following the release of Japan’s latest Defense White Paper expressing strong concern over China’s ‘coercive’ maritime advances in the East and South China Seas. The White Paper expresses strong opposition to the ongoing construction of new gas fields by the Chinese near the median line between China and Japan in the East China Sea region. These constructions have raised strong economic and security concerns within Japan. On the other hand, China has taken few steps to assuage Japanese concerns while maintaining a critical stance on Japan’s White Paper. Such developments could widen the gulf between the two countries further.Continue Reading →
Popular anti-foreign sentiments have been an important part of modern China’s historical interactions with the outside world, from the Boxer Rebellion at the turn of the 20th century to nationwide street protests against Japan in 2012. In recent years, nationalism has been cited as a key factor in the PRC’s more assertive foreign policy behavior. Some commentators have argued that popular nationalism is increasingly intense, and that officials may be increasingly responsive to public pressure. It is true that such sentiments play an increasingly important role, but the reasons have little do with either increasing levels of nationalism amongst the populace or official responsiveness to public opinion. Instead, this influence stems from the contradictions of party propaganda, a narrowing in the sources of Party legitimacy, and the content (or more accurately, vacuity) of modern Chinese nationalism itself. Together, these factors make anti-foreign nationalism in China even more worrisome than previously thought.Continue Reading →
A dominant theme in China’s current diplomacy is the “One Belt, One Road” initiative, aimed to promote economic integration and “connectivity” across Asia, Europe, and Africa. Since its introduction during President Xi Jinping’s visits to Central and Southeast Asia in 2013, Beijing has identified the initiative as its highest foreign policy priority in 2015 and most important new driver of national opening. The National Development and Reform Commission, Foreign Ministry, and Ministry of Commerce released an action plan for the initiative in March, pushing ahead various new bilateral and multilateral deals in support of the plan, most notably the AIIB, whose charter was signed in Beijing last month.
But what is so new about Xi Jinping’s Silk Road diplomacy? To many Chinese, “One Belt, One Road” marks a new, advanced phase in China’s reform and opening since 1978. On the other hand, outside observers have raised alarm over the strategic intentions behind what is perceived as an effort to reconstruct the postwar international order in competition with the United States. Such concerns, however, distract attention from the long-term significance of the Silk Road initiative, which ties together China’s enduring foreign policy goals and domestic development priorities.Continue Reading →
The launch of a UN arbitration tribunal on the China-Philippines maritime dispute has Asian powers watching closely as these debates unfold. From July 7 to 13 at The Hague, the Philippine delegation argued China violated the Philippines’s rights to exploit waters within a 200-nautical mile exclusive economic zone (EEZ) as established by the 1982 U.N. Convention on the Law of the Sea (UNCLOS). The treaty – which set rules on countries’ exercise of maritime activities – counts China, the Philippines, ASEAN countries, and many others as member-states. Sea-lanes through the South China Sea account for $5 trillion in trade every year. Therefore, the case could have a significant impact on many Asian nations, including Indonesia, Japan, Malaysia, Thailand, and Vietnam who attended the hearing as formal observers.
While Beijing refused to formally participate in the UN Permanent Court of Arbitration (PCA) – the chosen UNCLOS dispute resolution mechanism – Chinese officials have taken opportunities to state their case through formal and informal channels, raising legal questions about whether China can dip its toes in the water without getting drowned by the tribunal’s verdict. Before the tribunal can begin to consider the case, the PAC will first decide if it has jurisdiction over the dispute in question before a later possible hearing to determine the legal merits of the Philippine complaint.
This Policy Alert – written by Timothy Westmyer, the program and research assistant at the Sigur Center, is part of our series on Energy and Maritime Security for the Rising Powers Initiative’s new project: The Linkages between Energy Security and Maritime Strategies in the Indo-Pacific. The research effort looks at how energy security debates shape and influence maritime strategies and vice-versa in China, India, Japan, the Philippines, and Vietnam and the implications of these linkages for U.S. policy toward the region. (more…)Continue Reading →
The Iran nuclear agreement is a great victory for US President Barack Obama and Secretary of State John Kerry, neither of whom have had much success in foreign policy. Despite all the compromises, the Iran nuclear agreement – or the Joint Comprehensive Plan of Action (JCPOA) – does have the potential to hold Iran accountable for what it does with its nuclear programme for 15 years. This is assuming the US is willing to confront Iran if necessary, which is not a given especially in the remaining year and a half of the Obama administration. It also gives Iran yet another chance to prove that it is a state that abides by the solemn international commitments it willingly undertakes and that suspicions about it seeking nuclear weapons are unfounded.Continue Reading →
After long, fractious negotiations, world powers and Iran struck a historic deal on Tuesday to curb Iran’s nuclear program in exchange for billions of dollars in relief from international sanctions. This Policy Alert examines reactions from China, India, Russia, South Korea, and Japan to the Iranian nuclear deal.
Chinese media expressed cautious optimism for the nuclear deal and predicted a surge in trade between Iran and China as a result of the deal. (more…)Continue Reading →
Greece slipped deeper into its financial crisis at midnight Tuesday after it became the first developed economy to default on a loan with the International Monetary Fund. Greece will hold a referendum on Sunday, asking citizens to decide whether to accept the austerity demands of its international lenders in return for more cash. In this Policy Alert, we examine reactions from Russia, India, China, Japan, and South Korea to the ongoing Greek financial crisis.
Russian officials expressed concern about Greece’s financial crisis while simultaneously dispelling rumors that Russia might offer Greece a bailout. (more…)Continue Reading →
As the United States and China meet this week for the Strategic and Economic Dialogue, territorial disputes in the South China Sea will be near the top of the agenda. This event follows last month’s Shangri-La Dialogue in Singapore where U.S. Defense Secretary Ashton Carter and several other Asian powers expressed strong concerns over China’s now completed island-building reclamation efforts in disputed waters.
This Policy Alert is the first in a series on Energy and Maritime Security for the Rising Powers Initiative’s new project: The Linkages between Energy Security and Maritime Strategies in the Indo-Pacific. The research effort looks at how energy security debates shape and influence maritime strategies and vice-versa in China, India, Japan, the Philippines, and Vietnam and the implications of these linkages for U.S. policy toward the region.
Secretary Carter’s address to the Shangri-La Dialogue presented his vision for a “regional architecture” to tackle five major challenges: “long-standing rules and norms, strengthening our institutions, modernizing alliances, enhancing capabilities and improving connectivity.”
- He announced a new Southeast Asia Maritime Security initiative and plans to seek $425 million from Congress for these maritime capacity-building efforts.
The tense security environment has driven many U.S. allies and other powers in the Asia-Pacific to increase their purchase of U.S. defense technologies and equipment.
- According to Dr. Lyle Goldstein, an analyst at the U.S. Naval War College, “unquestionably we see countries spending a lot of money on very high-end equipment” and “there’s no question in my mind that it has to do with this South China Sea dispute.”
- However, Goldstein warned “because China’s relationship with Vietnam is very tense,” these now legal U.S. defense transfers to Vietnam might “in a way be waving a red flag in front of a bull.”
While several countries in the past have constructed artificial islands in South China Sea, China’s efforts are on a massive scale with “more new island surface [in the last 18 months] than all other nations have constructed throughout history.” During the Shangri-La Dialogue, however, Chinese Admiral Sun Jianguo pushed back against those who painted a negative picture of China’s maritime deeds:
- The admiral argued “the situation in the South China Sea is on the whole peaceful and stable, and there has never been an issue with the freedom of navigation.”
- China’s first white paper on military strategy released in late-May stated an “active defense” whereby “we will not attack unless we are attacked, but we will surely counterattack if attacked.” This characterization was echoed by Zhao Xiaozhuo, a researcher with the Chinese Army’s Academy of Military Science, who stressed “China’s great restraint” in the face of outside pressure.
While Chinese officials rejected calls to stop its reclamation project at the Singapore summit, Beijing later clarified on June 16 that it would soon end island-building activities in the South China Sea but not development of military and civilian facilities on the existing sites:
- Chinese Foreign Ministry spokesperson, Lu Kang, defended the work as “within the scope of China’s sovereignty.”
In response to outside pressure, several media outlets and China-based scholars turned the focus on the United States and the actions of its allies in the region:
- Wang Hui, senior writer at China Daily, protested U.S. involvement in the disputed waters as “counterproductive” and ultimately risking military confrontation. This view was echoed by China’s ambassador to the United States, Cui Tiankai.
- The Global Times editorialized that Carter’s remarks were “tarnishing China’s image to scare ASEAN” in hopes of driving “a wedge into the cooperation between China and the ASEAN countries.”
When Carter visited Indian leaders in early June, one of the top items on the agenda was the mounting tensions in the South China Sea, a continuation from President Obama’s January trip to the country and an October 2014 India-U.S. joint statement on “rising tensions over maritime territorial disputes” in the South China Sea.
Several local media outlets and commentators noted India’s low level of participation in the Shangri-La Dialogue and questioned New Delhi’s commitment to responding to China:
- In his column to The Indian Express, C. Raja Mohan considered the absence of the Indian defense minister from the Shangri-La Dialogue as a continued reluctance “to raise its regional security profile.”
- Pramit Pal Chaudhuri, foreign editor of the Hindustan Times, placed the China-India border dispute in the context of Beijing’s growing “assertiveness” in the South China Sea. Similarly, Anand Kumar, associate fellow at the Institute for Defense Studies and Analysis, wrote in the Business Standard that President Xi is “trying to make the country a maritime power.” He urged New Delhi to “go slow on its attempts” to improve ties with Beijing before gaining leverage to “put more pressure on the country to behave responsibly.”
- Mayuri Mukherjee, senior assistant editor for The Pioneer, saw the recent growth of defense cooperation between Vietnam and India as crucial to respond to China’s “challenge to India’s dominance in the Indian Ocean.” In addition to India’s recent agreement to develop sea-based oil projects with Vietnam, Sylvia Mishra and Pushan Das, researchers at the Observer Research Foundation, seconded this decision and urged India to extend more financial credit and defense assistance to Vietnam.
Tokyo has closely followed China’s activities in the disputed waters and made efforts at several international fora to keep the issue in the spotlight:
- While at the recent G-7 meeting, Japanese Prime Minister Shinzo Abe sought to raise Asia’s importance on the agenda and achieved a joint statement by leaders calling for a “rules-based maritime order and achieving maritime security.” At the Shangri-La Dialogue, China’s Admiral Sun Jianguo and the Director General of the Japanese Defense Policy Bureau Hideshi Tokuchi expressed interest in a Memorandum of Understanding on a “maritime and aerial crisis liaison mechanism” to diffuse tensions in the region such as the Diayou/Senkaku Islands dispute.
The United States, Japan, and the Philippines held joint maritime exercises this week near the disputed waters. Several commentators provided their thoughts on these regional security efforts:
- The Yomiuri Shimbun encouraged Japanese legislators to “enhance deterrence by expanding the roles of the [Self Defense Force]” against “China’s military buildup and maritime defense.” The Asahi Shimbun editorialized that while Japan needs to adjust its security strategies to “reflect changing global energy landscape,” the “world oil market is not driven by concerns about security threats posed by China.”
- On the other hand, The Mainichi pushed back on calls for the expansion of the Japan’s military mission, warning U.S.-led containment strategies against China may further mistrust between Tokyo and Beijing and harm economic growth. The Asahi Shimbun noted the “worrisome” expansion of Southeast Asian states’ naval power in response to China and how U.S. military operations could “further exacerbate tensions in the area.”
Several commentators and media sources in the Philippines expressed anxiety about China’s actions in the region and the U.S. response:
- Ana Marie Pamintuan, editor-in-chief for The Philippine Star, reported on how Beijing’s “expansive territorial claims” could one day disrupt critical ASEAN trade and supply lines. Elfren S. Cruz, a columnist for The Philippine Star, wrote that if the United States backs down to China’s “core interests of becoming the superpower in Asia,” then America “will lose its superpower position.” He warned some “countries – Japan, Vietnam, Philippines, Australia – will form a defensive alliance to protect themselves.”
- Godofredo Roperos, a columnist for the Sun Star Cebu, hoped the Philippines would receive a “favorable ruling from [the International Tribunal on the Law of the Sea in early 2016]” as it will “be a big victory diplomatically even if China will not recognize the decision.”
In contrast, other commentators warned that the Philippines would suffer in any U.S.-China conflict if Manila continued its own aggressive posture:
- The Tribune lamented that the Philippines were “moving based on which string the U.S. pulls that mostly consists of further incensing China and contributing to the already heated situation.”
- The Manila Times scolded Philippines President Benigno Aquino for issuing an “unnecessary provocation of China” and argued the “disputed territories issue should not define our relations with China” since the country has “more to gain from befriending China than by antagonizing it.”
- The Tribune felt this week’s maritime drills with the United States and Japan as well as Aquino’s effort to “irritate China [are] not producing the desired effect in terms of national welfare.
At the Shangri-La Dialogue, Vietnam’s Deputy Defense Minister attributed the elevated profile of the disputed waters on the agenda to China’s recent flurry of activity, which prompted a range of responses:
- Vietnam’s Rear Admiral Le Ke Lam stressed that his country considers “China’s act of turning the reefs of Vietnam that it illegally occupies into military outposts is very dangerous, seriously affecting security in the region and the world.”
- In an interview with VietNamNet Bridge, Tran Cong Truc, former chief of the Government’s Border Committee, warned the risk of escalation in the region was “pretty high, especially when China is now ignoring all multilateral and bilateral political agreements.”
In an interview with Vietnam’s Youth Online [article in Vietnamese], RPI project scholar Alexander Vuving compared China’s actions to the philosophy behind Sun Tzu’s The Art of War, naming that the supreme art of war is to “subdue the enemy without fighting”:
- He argued Beijing’s island reclamation efforts and legal maneuvering aim to create new conditions in the South China Sea where it can claim an exclusive economic zone and maintain control without resorting to military force.
Before traveling to India, Ashton Carter used his first trip to Vietnam as defense secretary to urge all countries in the region – including his host nation – to halt their land reclamation projects:
- Carter and Vietnam’s General Phung Quang Thanh signed a Joint Vision Statement whereby the United States pledged support for Hanoi’s peacekeeping training and operations.
- Furthermore, Vietnam’s Major General Le Van Cuong, former director of the Strategy Institute, welcomed the “strong” U.S. response, which “makes China more shy when doing brazen actions.”
Be sure to follow the RPI’s Energy Security and Maritime Debates in Asia project as these issues evolve. Stay connected on Twitter at @Westmyer or visit the project website and blog at http://www.risingpowersinitiative.org/projects/energy-maritime.
By Timothy Westmyer, Program and Research Assistant, Rising Powers InitiativeContinue Reading →