China's new grand strategy
- By Dan Steinbock
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E-mail chinausfocus.com, November 15, 2013
In turn, China’s pivot concentrates on trade and development across Asia. In the past, Chinese foreign ministers were U.S. or Russia experts. Now the emphasis is back in Asia, as evidenced by the new key actors. State councilor Yang Jiechi is focusing on China’s grand strategy in the region. Asia expert Wang Yi serves as chief of foreign ministry, while Washington ambassador Cui Tiankai, is also an Asia specialist.
Recently, President Xi Jinping proposed joint efforts with the 10 ASEAN member states to develop a ”Maritime Silk Road.” In Brunei, Premier Li Keqiang outlined China’s 10-point ASEAN initiative for friendship and cooperation, security exchanges, bilateral trade to 1 trillion U.S. dollars by 2020, an Asian infrastructure investment bank, and cooperation in maritime and regional finance.
After the May election victory of Nawaz Sharif and the Pakistan Muslim League (PML), Pakistan is moving toward development. Economic cooperation has accelerated with a free trade agreement and China’s assistance in the development of Pakistan’s infrastructure. Beijing is Islamabad’s third-largest trading partner and its largest supplier of arms. It has helped in building the Khushab reactor and is the largest investor in Pakistan’s deep-water port at Gwadar, located at the mouth of the Strait of Hormuz.
While Sino-Pakistan relations have served to balance India’s power in the region, the Sino-Bangladesh relations serve as a bridge to India. Trade between Dhaka and Beijing exceeded $8 billion in 2012, and it has been coupled with increasing defense procurement. Recently, Bangladesh’s foreign minister Dipu Moni met his Chinese counterpart Wang Yi in Beijing to push forward the Bangladesh-China-India-Myanmar (BCIM) Economic Corridor, which comprises Bangladesh, China, as well as Myanmar and India.
The BCIM reflects China’s rising maritime power, which is encountering its U.S. counterpart along the sea lines that connect China to energy resources in the Middle East and Africa. In the West, critics see the BCIM as a “string of pearls” that could one-day fuel China’s bid for regional primacy. In the East, the BCIM nations see regional integration as potential insurance for stability and prosperity.
The Chinese pivot extends from South and Southeast Asia to Central Asia. During his first trip to the region since assuming the presidency, President Xi Jinping attended the Shanghai Cooperation Organization (SCO) summit in Bishkek, Kyrgyzstan.
Today, the SCO’s six full members account for 60 percent of the landmass of Eurasia and a quarter of world population.
In the West, many observers see the SCO as a counterbalance to NATO, in addition to the United States. In the Xi-Li era, however, the new SCO trend toward economic development is likely to strengthen.
Chinese grand strategy as U.S. opportunity
What emerging Asia needs is broad and deep cooperation through security, trade and investment, and shared prosperity. Indeed, nothing reflects the rivalry for regional integration better than the race toward free trade.
Washington is in a hurry to complete a Trans-Pacific Partnership (TPP), which includes advanced economies in Oceania, all NAFTA partners, advanced ASEAN states, two Pacific nations and East Asia, minus China. The TPP, in turn, has intensified Asian-Pacific cooperation in which China does have a role, particularly through free trade talks among the 10 ASEAN member states, and their FTA partners. These talks aim at a Regional Comprehensive Economic Partnership (RCEP), which excludes the United States. Nonetheless, the Chinese concern remains that the RCEP will be less driven by upgrading and innovation than TPP.
What U.S.-China relations need is deeper cooperation, which, in turn, has the potential to support Chinese reforms and innovation. In the first nine months of 2013, Chinese firms spent a record $12.2 billion in the U.S. However, America is coping with a massive $8 trillion infrastructure investment bill. The debt-burdened U.S. local governments are courting Chinese investors to pay for the massive modernization.
Indeed, China’s new grand strategy – market-driven economic reforms coupled with deeper regional integration – is very much in the U.S. interest.
This commentary is based on Dr. Dan Steinbock’s extensive research as Visiting Fellow at Shanghai Institutes for International Studies, a leading think-tank. For more, see www.differencegroup.net
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