The Kindleberger Trap


January 16, 2017

The Kindleberger Trap

by Joseph S.Nye @www.project-syndicate.org

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CAMBRIDGE – As US President-elect Donald Trump prepares his administration’s policy toward China, he should be wary of two major traps that history has set for him. The “Thucydides Trap,” cited by Chinese President Xi Jinping, refers to the warning by the ancient Greek historian that cataclysmic war can erupt if an established power (like the United States) becomes too fearful of a rising power (like China). But Trump also has to worry about the “Kindleberger Trap”: a China that seems too weak rather than too strong.

Charles Kindleberger, an intellectual architect of the Marshall Plan who later taught at MIT, argued that the disastrous decade of the 1930s was caused when the US replaced Britain as the largest global power but failed to take on Britain’s role in providing global public goods. The result was the collapse of the global system into depression, genocide, and world war. Today, as China’s power grows, will it help provide global public goods?

In domestic politics, governments produce public goods such as policing or a clean environment, from which all citizens can benefit and none are excluded. At the global level, public goods – such as a stable climate, financial stability, or freedom of the seas – are provided by coalitions led by the largest powers.

Small countries have little incentive to pay for such global public goods. Because their small contributions make little difference to whether they benefit or not, it is rational for them to ride for free. But the largest powers can see the effect and feel the benefit of their contributions. So it is rational for the largest countries to lead. When they do not, global public goods are under-produced. When Britain became too weak to play that role after World War I, an isolationist US continued to be a free rider, with disastrous results.

Some observers worry that as China’s power grows, it will free ride rather than contribute to an international order that it did not create. So far, the record is mixed. China benefits from the United Nations system, where it has a veto in the Security Council. It is now the second-largest funder of UN peacekeeping forces, and it participated in UN programs related to Ebola and climate change.

China has also benefited greatly from multilateral economic institutions like the World Trade Organization, the World Bank, and the International Monetary Fund. In 2015, China launched the Asian Infrastructure Investment Bank, which some saw as an alternative to the World Bank; but the new institution adheres to international rules and cooperates with the World Bank.

Image result for thucydides trapSparta Vs Athens–America Vs China

On the other hand, China’s rejection of a Permanent Court of Arbitration judgment last year against its territorial claims in the South China Sea raises troublesome questions. Thus far, however, Chinese behavior has sought not to overthrow the liberal world order from which it benefits, but to increase its influence within it. If pressed and isolated by Trump’s policy, however, will China become a disruptive free rider that pushes the world into a Kindleberger Trap?

Trump must also worry about the better-known Thucydides Trap: a China that seems too strong rather than too weak. There is nothing inevitable about this trap, and its effects are often exaggerated. For example, the political scientist Graham Allison has argued that in 12 of 16 cases since 1500 when an established power has confronted a rising power, the result has been a major war.

But these numbers are not accurate, because it is not clear what constitutes a “case.” For example, Britain was the dominant world power in the mid-nineteenth century, but it let Prussia create a powerful new German empire in the heart of the European continent. Of course, Britain did fight Germany a half-century later, in 1914, but should that be counted as one case or two?

World War I was not simply a case of an established Britain responding to a rising Germany. In addition to the rise of Germany, WWI was caused by the fear in Germany of Russia’s growing power, the fear of rising Slavic nationalism in a declining Austria-Hungary, as well as myriad other factors that differed from ancient Greece.

As for current analogies, today’s power gap between the US and China is much greater than that between Germany and Britain in 1914. Metaphors can be useful as general precautions, but they become dangerous when they convey a sense of historical inexorableness.

Even the classical Greek case is not as straightforward as Thucydides made it seem. He claimed that the cause of the second Peloponnesian War was the growth of the power of Athens and the fear it caused in Sparta. But the Yale historian Donald Kagan has shown that Athenian power was in fact not growing. Before the war broke out in 431 BC, the balance of power had begun to stabilize. Athenian policy mistakes made the Spartans think that war might be worth the risk.

Athens’ growth caused the first Peloponnesian War earlier in the century, but then a Thirty-Year Truce doused the fire. Kagan argues that to start the second, disastrous war, a spark needed to land on one of the rare bits of kindling that had not been thoroughly drenched and then continually and vigorously fanned by poor policy choices. In other words, the war was caused not by impersonal forces, but by bad decisions in difficult circumstances.

That is the danger that Trump confronts with China today. He must worry about a China that is simultaneously too weak and too strong. To achieve his objectives, he must avoid the Kindleberger trap as well as the Thucydides trap. But, above all, he must avoid the miscalculations, misperceptions, and rash judgments that plague human history.

https://www.project-syndicate.org/commentary/trump-china-kindleberger-trap-by-joseph-s–nye-2017-01

China’s Advice–Pursue the path of mutually beneficial cooperation for regional peace and stability


January 12, 2017

China issues urges small and medium-sized countries to pursue the path of  mutually beneficial cooperation for regional peace and stability

Image result for China the SuperpowerChina–Exercising Soft Power in Asia

by Channel News Asia

SINGAPORE: China on Wednesday (Jan 11) issued its first white paper on issues related to Asia-Pacific security cooperation.

In the six-point proposal, reproduced in full by Xinhua, Beijing stated that “small- and medium-sized countries need not and should not take sides among big countries”.

“All countries should make joint efforts to pursue a new path of dialogue instead of confrontation and pursue partnerships rather than alliances, and build an Asia-Pacific partnership featuring mutual trust, inclusiveness and mutually beneficial cooperation,” the white paper read.

It added that China would step up its role in regional and global security to take on greater responsibilities. “China is ready to pursue security through dialogue and cooperation in the spirit of working together for mutually beneficial results, and safeguard peace and stability jointly with other countries in the region.”

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“The realities of geography, military and vast economic power yield China essentially permanent advantages over its near neighbors. They are always going to live in the shadow of China, and their economies will continue to be become more closely integrated with China’s. China’s neighbors will always need Beijing more that it needs them. This leverage means that over the long term, whether control is centralized or not, China’s strategic approach to maritime issues will leave little room for compromise.”http://nationalinterest.org/blog/the-buzz/the-real-south-china-sea-problem-the-shadow-china-12015–

China remains committed to “upholding peace and stability in the South China Sea” and will continue to maintain dialogue on the issue with the Association of Southeast Asian Nations (ASEAN), it said.

However, Beijing also warned that it could be forced to issue “necessary responses to the provocative actions which infringe on China’s territorial sovereignty and maritime rights and interests, and undermine peace and stability in the South China Sea”.

It added that no effort “to internationalise and judicialise” the South China Sea issue “will be of avail”.

The paper concluded that China’s development would add to “the momentum for world peace”.In a news conference to explain the white paper, Vice Foreign Minister Liu Zhenmin said it proposes to strengthen cooperation by promoting common development, perfecting existing regional multilateral mechanisms, promoting rule setting, intensifying military exchanges and cooperation, and properly resolving divergences and disputes.

“We hope that all countries in the region will work along with China to uphold win-win cooperation and make joint efforts in achieving long-lasting peace and stability in the Asia-Pacific region,” he said.

 

 

http://www.channelnewsasia.com/news/asiapacific/china-issues-white-paper-warns-small-and-medium-sized-countries/3430786.html

Putting the Pacific on China’s Radar


January 6, 2017

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Number 366 | January 5, 2017

ANALYSIS

Putting the Pacific on China’s Radar

by Tristan Kenderdine

As China’s foreign direct investment strategy is increasingly formalized into international capacity cooperation funds, Pacific Island economies are struggling to engage China’s broader Belt and Road policies. While Beijing’s investment and trade strategy continues to transform the ocean corridor west from Southern China to Southeast India, the South Pacific looks to be orphaned through yet another period of history. However, the Pacific Islands Forum economies have a huge opportunity to align with China’s global geo-strategy through the new capacity cooperation financing mechanisms.

In 2016, China embarked on a massive capacity cooperation funding campaign to develop a parallel trading system which bypasses international capital infrastructure and allows China to invest abroad while maintaining a closed capital account. This campaign forms the vanguard of a state trade strategy with a transformative power over the macro Asian region. Targeted economies include Central Asia, West Asia, Southeast Asia, Africa, Latin America and most recently Central and Eastern Europe.

Both the People’s Republic and the Republic of China have long engaged in aid-for-diplomacy strategies in Pacific Island states. However Beijing now sees a crossroads emerging between South America and China through the Pacific, and has a new strategic interest which goes beyond the Taiwan issue.

China’s slowing industrial economy has also seen a growing desperation from Beijing to offshore industrial growth. Foreign direct investment from Chinese state-driven infrastructure projects has increasingly found its way to states recognizing the People’s Republic: Papua New Guinea, Fiji, Tonga, Samoa, Vanuatu, and the Federated States of Micronesia. Despite this, no specific capacity cooperation funds – the finance mechanism for Belt and Road offshoring industrial capacity – have yet been earmarked for Pacific Island states.

China’s wider ocean strategy includes industrial and agribusiness offshore investment. Its Pacific Island trade and investment strategy is run through Guangdong Province and provincial level cities there which coordinate investment in Pacific Island fisheries, agriculture, and infrastructure.

The more specific Belt and Road strategy links China’s eastern and southern port cities with Europe via the Indian Ocean port system. Designated trading routes pass through the South China Sea and the Malacca Straits, then through Myanmar and Sri Lanka on the way past India, and the Middle East toward European sea terminals in Greece, Turkey and Italy.

Pacific Island countries sit at a different crossroads, between South America and China’s East Coast. The development of China’s rail and canal projects is opening logistics infrastructure hubs in South and Central America. This means that a new South Pacific shipping corridor is likely to open up.

A deep-water container port at a half-way point could replicate Dubai’s air strategy on the sea. Fiji becoming a maritime Dubai would bring investment to the region and facilitate trans-Pacific trade logistics. As Papua New Guinea has benefited from liquefied natural gas exports to Taiwan, China and Japan, so too can other Polynesian, Melanesian, and Micronesian island economies find new trade avenues into the Asian mainland.

Containerized intermodal shipping logistics and refrigerated shipping will see huge demand as China’s domestic cold-chain logistics system develops. Chinese demand for a variety of commodities from South and Central America will see increased demand for both soft and hard commodities shipping. A global downturn in shipping paired with an oversupply of ships creates opportunity for Pacific Island countries to develop trade routes while infrastructure is affordable.

South Pacific fisheries and food industrialization present an opportunity to feed China’s huge and growing demand for fish protein that neither global wild catch nor industrial aquaculture can currently service. Mariculture, landing stations and harbor infrastructure, fish processing facilities, and aquaculture development all hold potential for Pacific Island economies. Fish processing facilities could leverage Chinese investment in infrastructure, build aquaculture employment bases and export clean fish products to the Chinese mainland. China’s distant water fleets already exploit wild-catch in both the Pacific and Southern Oceans and China has a huge demand for high-quality, safe, standardized food.

Gene industrialization and gene research is a key strategic industry for China. Legal and organizational developments in seed and animal genetics are laying the groundwork for China to become a world leader in genetics. Interest in biodiversity in the Pacific and the seabed are clear. Negotiations on Biological Diversity Beyond Areas of National Jurisdiction demonstrate China’s interest in marine biodiversity.

“Commerce with China [could] build the Pacific Islands into a genuine trade bloc.”

China is also at the forefront of international seabed mining, taking a leading role in the International Seabed Authority. Chinese state owned enterprise, China Ocean Mineral Resource Research and Development Association currently has 15-year exploratory rights over areas in the Clarion-Clipperton fracture zone, searching for ferromanganese, cobalt and polymetallic nodules. As more industrialized nations engage in the 21st century submarine land-grab, the Pacific Island economies are sitting on more land than most continental countries that, if leveraged well, could bring huge benefit to their populations.

Aerospace technologies, satellite communications and space policy are also rapidly being developed by China, which has signaled a desire to create a network of floating satellite ground stations. Given an increasing constellation of satellites and more sophisticated use, China needs reliable communications surface stations in the South Pacific.

China also faces a dependency on US controlled submarine internet communications lines. The global internet infrastructure is dependent on cables lying across the ocean floor such as Blue Sky – the proposed line from New Zealand to the US. China has already laid its own cables between South America and Africa, and faces bottlenecks to both service and security in the Hawaiian dominated north Pacific. A South Pacific communications route to South America would be invaluable to China, and access to this cable infrastructure would be equally valuable to Pacific Island economies.

In 2016, China embarked on a massive capacity cooperation funding campaign to develop a parallel trading system which bypasses international capital infrastructure and allows China to invest abroad while maintaining a closed capital account. This campaign forms the vanguard of a state trade strategy with a transformative power over the macro Asian region. Targeted economies include Central Asia, West Asia, Southeast Asia, Africa, Latin America and most recently Central and Eastern Europe.

Both the People’s Republic and the Republic of China have long engaged in aid-for-diplomacy strategies in Pacific Island states. However Beijing now sees a crossroads emerging between South America and China through the Pacific, and has a new strategic interest which goes beyond the Taiwan issue.

Thinking of China as a net exporter of capital goods, and importer of consumer goods, means small economies plugged into China need pay attention to consumer sentiment and behavior in the country. China’s wider geopolitical and marine strategies will bring investment and infrastructure to Pacific Island economies. This capital of course comes with state mercantilist strategies attached. However, access to these consumer markets will allow Pacific Island exports to feed China’s demand for fish protein, hydrocarbons, minerals, biopharmaceuticals and marine energy.

Outside analysis of economic development in the Pacific has too long focused on tourism, remittance and aid, ignoring the export potential of the island economies. As the Pacific Island economies increasingly engage with global trade, capital investment from China can help to develop industrial infrastructure for further regional economic integration. While both Chinese capital and construction projects present sustainability and quality problems, an impending wave of investment should be harnessed by the Pacific Islands Forum as an opportunity for capital, infrastructure and economic development for the region as a contiguous whole. Let commerce with China build the Pacific Islands into a genuine trade bloc and let us banish dependency economics once and for all.

About the Author

Tristan Kenderdine is Research Director at Future Risk and Assistant Professor at Dalian Maritime University. He can be contacted at Tristan.Kenderdine@anu.edu.au.

The East-West Center promotes better relations and understanding among the people and nations of the United States, Asia, and the Pacific through cooperative study, research, and dialogue.

Established by the US Congress in 1960, the Center serves as a resource for information and analysis on critical issues of common concern, bringing people together to exchange views, build expertise, and develop policy options.

The Asia Pacific Bulletin (APB) series is produced by the East-West Center in Washington D.C

APB Series Editor: Dr. Satu Limaye, Director, East-West Center in Washington D.C.
APB Series Coordinator: Peter Valente, Project Assistant, East-West Center in Washington D.C.

The views expressed in this publication are those of the authors and do not necessarily reflect the policy or position of the East-West Center or any organization with which the author is affiliated.

For comments/responses on APB issues or article submissions, please contact East-West Center | 1601 East-West Road | Honolulu, HI | 808.944.7111

East-West Center in Washington D.C | 1819 L Street, NW, Suite 600 | Washington, DC | 202.293.3995

Bilateral and Regional Implications of the U.S.-Philippine Enhanced Defense Cooperation Agreement


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Number 365 | December 21, 2016

ANALYSIS

Bilateral and Regional Implications of the U.S.-Philippine Enhanced Defense Cooperation Agreement

By Renato De Castro

On April 28, 2014, then Philippine Secretary of National Defense Voltaire Gazmin and U.S. Ambassador to the Philippines Philip Goldberg signed the Enhanced Defense Cooperation Agreement (EDCA) a few hours before President Barack Obama’s arrival in the Philippines. The signing of the EDCA sent a strong diplomatic signal to Beijing that it would have to take account of an American military presence in the Philippines if it chose to unilaterally change the status quo in the South China Sea. More significantly, a rotational U.S. military presence was expected to strengthen the Philippines’ determination to uphold its territorial claims vis-à-vis China in the South China Sea dispute backed by American resolve and credibility to honor its defense commitment to the Philippines.

 The 21st Century Philippine-U.S. Enhanced Defense Cooperation Agreement (EDCA)

This is not a new security treaty; it is merely an updated version of the 1951 Mutual Defense Treaty. This executive agreement serves as a framework by which the Philippines and the U.S. can develop their individual and collective defense capabilities. This goal is accomplished through the rotational deployment of American forces in Philippine bases. Although the EDCA allows American forces to utilize facilities owned and controlled by the Armed Forces of the Philippines (AFP), the Philippine base commander has unrestricted access to these locations. Likewise, American-built or American-improved infrastructure inside these installations can be used by the AFP. Furthermore, any construction and other activities within the Philippine bases require the consent of the host country through the Mutual Defense Board (MDB) and Security Engagement Board (SEB). More importantly, the EDCA is designed to minimize domestic opposition to U.S. military presence in the country by explicitly affirming Philippine sovereignty and providing a legal framework for increased American rotational presence rather than the re-establishment of permanent bases, which remains a sensitive issue among Filipinos.

The EDCA also proved advantageous to the AFP. With its small and obsolete naval force and an almost non-existent air force, the Philippine military benefits from the regular and short-term visits of U.S. forces that conduct military training as well as humanitarian and disaster response operations. Logistically, the U.S. construction of vital military facilities, infrastructure upgrades (such as hangers, air defense surveillance radar systems, ground based air defense systems, and naval operating bases), and the storage and prepositioning of defense equipment in agreed locations can lower the cost of the force and training modernization programs since the buildings and equipment can be shared and utilized jointly by American and Philippine Armed Forces.

The implementation of EDCA augurs well for the Philippine military. Philippines Air Force (PAF) fighter pilots can train with their American counter-parts at the five airbases that are part of the agreement. The PAF can also use facilities that American forces will improve or build inside its facilities. In addition, the Obama Administration has requested US$50 million from the U.S. Congress to fund the Maritime Security Initiative in Southeast Asia. The lion’s share of the funds in the first year will go to the AFP’s capability building program. It is expected that there will be allocations for the purchase of equipment to monitor activities and movements in the South China Sea.

Regional Security Implications

During the Sixth Annual Bilateral Security Dialogue (BSD) between the U.S. and the Philippines in Washington D.C. on March 18, 2016, it was announced that American forces will be allowed access to the following AFP bases: Antonio Bautista Air Base in Palawan; Basa Air Base and Fort Magsaysay in Luzon; Lumbia Air Base in northern Mindanao; and Mactan-Benito Ebuen Air Base in Cebu.

With EDCA’s implementation, the United States enhances the rotational presence of its forward-deployed forces, improves existing facilities, and pre-positions supplies and equipment in five agreed-upon locations. In the long-term, the effects of EDCA will go beyond the modernization of the Philippines’ military and increased inter-operability between the armed forces of the two allies. The EDCA will have two far-reaching strategic/diplomatic implications. First, a rotational U.S. military presence will strengthen the Philippines’ resolve to uphold its territorial claims in the South China Sea and test American credibility in honoring its defense commitment to the country. Second, the use of air and naval infrastructure in the Philippines will facilitate a rapid and massive deployment of American forces in case armed clashes erupt in potential flash points such as the South China Sea, the East China Sea, and in the Taiwan Strait.

Since the 1996 Taiwan Strait Crisis, the USAF has sought arrangements for the rotational deployments of its aircraft and personnel in the Philippines. This arrangement entails infrastructural improvements to keep facilities “warm,” enabling the rapid start of operations in the event of a crisis. American access to the aforementioned five operationally flexible Philippine bases addresses this need. It also thwarts China’s plan of preventing U.S. forces from operating in the disputed South China Sea.

Conclusion

Currently, there is small unit of USAF aircraft and personnel deployed in the Philippines.  Only time will tell whether this small USAF formation will become an effective forward-deployed force that can deter China’s expansion in the South China Sea. This will depend largely on how President Rodrigo Duterte would tolerate China’s expansion into the Philippines’ maritime domain, and the importance of his country’s long-standing alliance with the U.S. Recently, however, President Duterte has expressed critical comments toward the alliance. He announced that he wants the withdrawal of 107 American troops from Mindanao, saying that he was only maintaining them against possible attacks by Muslim militants. He declared that the Philippines would stop patrolling the country’s Exclusive Economic Zone (EEZ) in the South China Sea with the U.S. Navy to avoid provoking China. In early October, he also announced that the U.S.-Philippine Philbex joint amphibious exercise would be the last during his four-year term.

On November 7, 2016, despite his earlier rhetoric against the U.S. and the alliance, President Duterte suddenly gave his consent for the conduct of a joint U.S.-Philippine military exercise and for the implementation of the EDCA. His decision to continue joint U.S.-Philippine military exercises and to implement the EDCA will be conveyed to the MDB later this month. However, it is still too early to guess President Duterte’s future executive decisions toward the implementation of the EDCA in particular, and the alliance in general. The AFP’s recommendations to conduct joint exercises between U.S. and Philippine forces and the implementation of EDCA will not only affect Philippine national security interests but also the regional balance of power.

About the Author

Dr. Renato Cruz De Castro is a professor (on sabbatical leave) in the International Studies Department, De La Salle University, Manila, and holds the Charles Lui Chi Keung Professorial Chair in China Studies.  He is currently the U.S.-ASEAN Fulbright Initiative Researcher from the Philippines based in the East-West Center in Washington, D.C. He can be contacted at renato.dccastro@dlsu.edu.p

The East-West Center promotes better relations and understanding among the people and nations of the United States, Asia, and the Pacific through cooperative study, research, and dialogue.

Established by the US Congress in 1960, the Center serves as a resource for information and analysis on critical issues of common concern, bringing people together to exchange views, build expertise, and develop policy options.

The Asia Pacific Bulletin (APB) series is produced by the East-West Center in Washington.

APB Series Editor: Dr. Satu Limaye, Director, East-West Center in Washington
APB Series Coordinator: Peter Valente, Project Assistant, East-West Center in Washington

The views expressed in this publication are those of the authors and do not necessarily reflect the policy or position of the East-West Center or any organization with which the author is affiliated.

For comments/responses on APB issues or article submissions, please contact washington@eastwestcenter.org.

East-West Center | 1601 East-West Road | Honolulu, HI | 808.944.7111

East-West Center in Washington | 1819 L Street, NW, Suite 600 | Washington, DC | 202.293.3995

East-West Center in Washington, 1819 L Street, NW, Suite 600, Washington, DC 20036

Under Trump,US Allies in Asia May Look to Themselves for Security


November 13, 2o16

For years, American allies in East and Southeast Asia have been quietly preparing to rely less on the United States for regional stability and security. That shift came despite President Barack Obama’s strategic “pivot” to Asia, which was a centerpiece of his administration’s foreign policy and was likely to continue if Democrat Hillary Clinton had won Tuesday’s U.S. presidential vote — notwithstanding her election-year renouncement of the Trans-Pacific Partnership.

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President-elect Donald Trump’s upset in the election, however, could mean a very different future for U.S. foreign policy in the region, and could hasten the drive toward the self-reliance among Asian allies that is already underway.

“Asians have quietly been hedging their bets for many years that America’s distraction with the Middle East and lingering budget woes would eventually lead to a retrenchment of American leadership,” said Lindsey Ford, who advised senior Defense Department officials on Asia policies for more than four years under the Obama administration, until 2015.

“Unless a new Trump administration moves quickly to assuage these fears, this trend will only increase,” Ford, now director of Asian security at the Asia Society Policy Institute, said in a statement just after Tuesday’s election.

On the campaign trail, Trump said he would call on Japan and South Korea to pay more of a share in the expenses of security cooperation with the United States, and expressed openness to the idea of nuclear proliferation among U.S. allies. Obama is set to leave office at a time of rising tensions over disputes in the East and South China Seas and North Korea’s continued development of nuclear weapons. Foreign Policy asked Ford to outline a sense of what U.S. allies in East and Southeast Asia should expect.

Under Trump, U.S. Allies in Asia May Look to Themselves for Security

This interview, conducted by email, has been condensed and edited.

FP: What is the most telling example of Asian allies hedging in preparation for a diminished U.S. presence in the region?

LF: One of the most telling examples of Asian hedging is the careful balancing act we’ve seen Association of Southeast Asian Nations nations engaging in for quite some time. This has included diversifying both their economic ties as well as their military investments between the U.S. and China. Witness this past month’s visits by [Philippine President Rodrigo] Duterte and [Malaysian] Prime Minister Najib [Razak] to China as a great example. We’ve also seen this balancing act play out time and again in the South China Sea, where ASEAN nations have wrestled with how to avoid hewing too closely to either the United States or China.

FP: What specifically might Trump do to assuage these fears?

LF: President-elect Trump could begin by publicly reaffirming that America’s extended deterrence commitments — its nuclear umbrella — remains rock solid. His earlier suggestion that countries like Japan and the Republic of Korea should perhaps seek out their own nuclear capabilities seriously spooked Asian partners. While he may not wish to explicitly walk back these statements, he needs to make clear that nuclear proliferation is in no one’s best interests and that the United States remains firmly invested in protecting its allies from nuclear attack or provocation.

FP: U.S. partners like Japan and the Philippines are already looking to further boost their own military capabilities — what might an acceleration in those efforts look like?

LF: Under President [Shinzo] Abe, Japan has slowly dipped its toes in the waters of becoming a more “normal” military power for the first time since World War II. Thus far, Japan has proceeded relatively cautiously in reinterpreting its definition of “self-defense” and the appropriate role for its military forces. However, this change could be accelerated should Japan feel more convinced it could not rely on the U.S. security umbrella. We could potentially see Japan moving to increase military spending above its traditionally limited levels of one percent of gross domestic product. We could see an Abe government push to more fundamentally revisit or overturn Article 9 of the Constitution, allowing Japan to build a more traditional “offensive” capability for its forces. Either of these developments would worry neighbors such as the Republic of Korea and China, potentially setting off ripple effects in terms of their own military spending and posture.

FP: Does the imminent breakdown of the Trans-Pacific Partnership have security implications?

LF: From a security perspective, the biggest implication of our failure to secure the TPP would be the loss of American credibility in Asia. If our allies and partners view our failed follow through on issues such as TPP and Syria as evidence that America will not make good on its word, it will greatly diminish their trust in our security commitments and leadership. This could, in turn, make it harder for the U.S. to build coalitions of support on any number of thorny international security problems, such as countering the Islamic State and deterring North Korean provocations.

FP: A line of presidents have failed to make substantial diplomatic headway with North Korea. What might a Trump approach look like — are there any clues?

LF: Dealing with the North Korea situation is perhaps the biggest looming issue in Asian security affairs at the moment, and one that the incoming president will need to move quickly to address. There is very little indication that Donald Trump has already developed these plans, or that he fully appreciates the long graveyard of failed North Korea policies that have preceded him. In brief statements on the issue thus far, he has suggested he would merely tell China “this is your problem.” This approach will almost certainly fail. One can only hope that in the coming months he will reach out, as he has suggested, to solicit creative thinking on this and other issues.

FP: Does Taiwan face increased risks under Trump?

LF: It’s simply too soon to speculate what a Trump presidency could mean for Taiwan. Taiwan has typically enjoyed strong bipartisan support within the U.S. Congress, but like the rest of Asia, they will need to spend some time sounding out the new team and taking the temperature to see where things stand.

The East Asia Summit: a platform for confidence building


November 12, 2016

The East Asia Summit: a platform for confidence building

by John Pang, The Rajaratnam School of International Studies, NTU

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The East Asia Summit (EAS) started with a vision of community building. With US participation and rising strategic tensions, it has instead become a regional confidence building and conflict prevention mechanism — a role that ASEAN should embrace and sharpen. The long-term task of community building could be left to sub-regional groupings like the ASEAN+3 forum and its offshoot, the Northeast Asian forum.

 ASEAN should streamline the EAS agenda and actively frame the region’s most important security discussions. It should strengthen its public communications with the ASEAN public and the international community to better convey the role of the EAS.

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This may mean having multiple-track discussions to formulate important issues ahead of time. It may also mean some level of integration with the ASEAN Regional Forum so that it more directly supports the EAS on security issues. ASEAN can do more to shape the conversation while ensuring that the meeting remains open enough to allow for personal interaction among the leaders. The EAS can play a crucial role if ASEAN retains the coherence and clout to push forward with regional discussions in a positive way.

The EAS originated as a project of the East Asian Economic Caucus. When Malaysia’s former Prime Minister Mahathir Mohamad first proposed an East Asian Economic Grouping in the 1990s, the North American Free Trade Area and the European Union were being formed and it seemed important for East Asia to form a grouping of its own.

The shared trauma of the 1997 Asian Financial Crisis gave the project impetus. IMF assistance was conditional on the governments of stricken economies adopting austerity measures that aggravated the suffering of ordinary citizens. A Japanese proposal to render assistance was vetoed by the United States. So ASEAN, China, Japan and South Korea came together to form a swap fund called the Chiang Mai Initiative as a contingency against such crises.

But by 2005 — when the EAS conducted its first meeting in Kuala Lumpur — the idea of an East Asian Economic Caucus had taken a backseat. No longer the obvious leader, Japan’s priority shifted to ‘balancing’ China’s growing might. Japan lobbied successfully for the enlargement of the EAS membership to include Australia, New Zealand and India with a path carved out for US and Russian participation. The Summit had become a forum for security issues, while the idea of a regional community receded to the background.

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By 2011, the United States and Russia had become full participants. In recent history, the single biggest influence on the direction of the EAS has been the consistent presence of Washington’s ‘Pacific President’. Obama has attended every summit since the US inclusion, except once when he was prevented by a budget crisis in Washington. US participation has shifted the EAS agenda towards geostrategic concerns. This coincided with China taking a more confrontational stance in the South China Sea.

The EAS is by design a flexible forum for strategic dialogue and cooperation on the key issues facing the region. The leaders can shape the agenda with their personal interventions. The role of the United States is all the more prominent because the president attends, while China and Russia only send their premiers.

Its ASEAN-style menu of non-contentious and constructive discussion areas feature cooperation on environment and energy, education, finance, global health issues and pandemic diseases, natural disaster management and ASEAN connectivity. Post-2010, the EAS, whatever the official agenda, focused on contemporary and pressing ‘strategic issues’ such as the South China Sea and North Korea’s nuclear program. Heightened US–China rivalry has strained ASEAN unity. Each ASEAN Summit since then has been a test of ASEAN unity.

Expectations going into this year’s ASEAN meetings and the EAS Summit in Vientiane were low. It was easy to dismiss Laos as being firmly in China’s camp. Over the course of the year, a narrative had built up about the danger of ASEAN being split between a China-leaning Indochina and a more pro status quo, pro-Western maritime ASEAN. The Hague Tribunal’s ruling in favour of the Philippines’ territorial claims in the South China Sea raised the temperature of the discussions.

There were fears ASEAN might be so disunited that it might again fail to issue a joint statement, as happened in Phnom Penh in 2012. The Laos chairmanship confounded those expectations with an agreement to take the South China Sea issue forward in a manner long advocated by ASEAN.

Despite increased tensions, this year’s EAS Chairman’s Statement once again expressed concerns about ‘developments in the South China Sea’ without a veto by China. The statement affirmed a joint commitment to resolving disputes in accordance with the principles of international law. Most importantly it emphasised the need for ASEAN member states and China to ensure ‘the full and effective implementation of the Declaration on the Conduct of Parties in the South China Sea’. They also signalled their intention to work towards the early conclusion of a code of conduct in the South China Sea.

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There are good signs that despite the international media and pundits’ alarm over the peril of the South China Sea issue, the United States and China retain the ability to deal with one another through ASEAN in constructive ways. ASEAN continues to draw the major parties to the table and appears resourceful enough to manage regional tensions and avert open conflict.

John Pang is a Senior Fellow at the S. Rajaratnam School of International Studies (RSIS), Nanyang Technological University, Singapore.

A version of this article was first published here, by RSIS.

The East Asia Summit: a platform for confidence building