New Chinese Approach to South East Asia In the past China did not trust the multilateral dia-

logue on security and prefer to deal with this issue bilaterally. However, China seemed to have more confi- dence and saw benefits from multilateralism, probably from the good experience with ASEAN. China’s new approach to South East Asia included the following.

(1) New Concept on Security After the end of the Cold War in the early 1990s, China saw the change in strategic landscape as a result of the demise of Commu- nism and the rise of the US as hegemonic power. Global- ization and the rapid change in technology affected international environment and security. China began to develop and articulate a new concept of security which expanded the old narrow definition of security to include defense, diplomatic, political as well as economic consideration. Hu Jintao, then Vice President visiting Indonesia in July 2000, advocated a new concept of security a Indonesia Council on World Affairs:

“…A new security concept that embraces the prin- ciples of equality, dialogue, trust and cooperation, and a new security order should be established to ensure genuine mutual respect, mutual cooperation, consensus through consultation and peaceful settlement of disputes, rather than bullying, confrontation and imposition of one’s own will upon others. Only in that way cab coun- tries coexist in amity and secure their development...” ⁽⁶⁾

This was echoed again by Chi Haotian, then China’s Defense Minister in September 2000 at the 4th ARF meeting of the Heads of Defense College in Beijing:

“ …we advocate that all countries adopt the new security concept built upon equality, dialogue, mutual confidence and cooperation” ⁽⁷⁾

From the new Chinese perspective, Security was not just a matter of military capability. In fact national security was inseparable from political stability, eco- nomic success and social harmony. Yang Yanyi, Deputy Director General of Policy Planning Department of Ministry of Foreign Affairs of China elaborated further that the new security concept “is characterized by mutual trust, mutual benefit, equality and coordination.” ⁽⁸⁾

China believed that the frequent dialogue and mutual briefings on each other’s security and defense policies could contribute to bring up the comfort level and degree of confidence and fostering goodwill and trust. Besides trust, mutual benefits should also be advocated through multilateral mechanism. “China sees to it while ensuring its own security interests, other countries security interests are also respected.” Equality was also important in the sense that countries, big or small, strong or weak must subscribe the same “universally recognized norms and principles especially the principles of sovereign equality, non-interference in each other internal affairs and peaceful settlement of international disputes.” China also placed a premium on dialogue and consultation in place of coercion and confrontation in addressing security issues.

The objective of China’ security policy on the Asia Pacific is composed of three parts: China’s own stability and prosperity, peace and stability in the surrounding region; and dialogue and cooperation with other coun- tries in the Asia-Pacific region.

(2) Strengthen bilateral relations with ASEAN neighbours China pursued a good neighbourly partnership with her southern neighbours in South East Asia. To enhance further cooperation with ASEAN, China during 1999-2001 negotiated and signed bilateral documents and statements with ASEAN countries on the long-term cooperative frameworks. Thailand was the first ASEAN member to sign a Joint Statement on a Plan of Action for the 21^st century in February 1999, laying out the plan for cooperation in various fields including political, economic cultural and security.

Later on China signed with nine other members of ASEAN on similar statements, indicating her commit- ment in promoting regional stability, peace and prosper- ity. It was significant that all the statements affirmed that the bilateral relations would be based on the basic norms found in the UN Charter, the Five Principles of Peaceful Coexistence, ASEAN Treaty of Amity and Cooperation (TAC), and recognized principles found in the interna- tional law. Bilateral political dialogues including policy dialogue on strategic and security issues between China and each members of ASEAN would contribute to mutual understanding and trust.

(3) Promoting multilateral cooperation The mul- tilateral relations between China and ASEAN have

contributed significantly to a closer relation and coopera- tion. Since July 1994 China and ASEAN agreed to open consultation on political and security issues at the senior official level. By February 1997, ASEAN and China formalized their cooperation by establishing the ASEAN- China Joint Cooperation Committee (ACJCC) to act as the coordinator for all ASEAN-China mechanism at the working level.

China became ASEAN dialogue partner and partici- pated in the annual ASEAN Post Ministerial Conference (PMC) consultation process, with other dialogue partners (ASEAN 10+10) as well as the meeting between ten ASEAN members and each dialogue partner (ASEAN 10+1). China also participated in another ASEAN multilateral mechanism, the ASEAN Regional Forum, reluctantly at first. Later China had taken an active role in the ARF process especially the intersessional work program related to confidence building measures.

Besides the above, the ASEAN-China multilateral relations was expanded and transformed into ASEAN plus Three (APT) which include China, Japan and South Korea and evolved into annual summit meetings at head of state level. At the APT summit in Cambodia in November 2002, ASEAN and China signed a “Frame- work Agreement on Comprehensive Economic Coopera- tion Between ASEAN Nations and the People’s Republic of China. This agreement aims to establish a Free Trade Area between China and ASEAN, which will be dis- cussed later.

Also in Cambodia, at the 6^th ASEAN-China summit, the leaders of ASEAN and China signed a Joint Declara- tion of ASEAN and China on Cooperation in the Field of Non-Traditional Security Issues, agreeing to cooperate in combating trafficking in illegal drugs, people-smuggling including trafficking in women and children, sea piracy, terrorism, arms smuggling, money laundering, interna- tional rime and cyber crime. Moreover, China also signed here with ASEAN a Declaration on the Conduct of Parties in the South China Sea. At the November ASEAN2003 Summit in Bali, Indonesia, China also acceded the ASEAN Treaty of Amity and Cooperation, becoming the first non ASEAN member to do so.

(4) Deepening economic relationships with ASEAN through Free Trade Agreement The economic rela- tions between China and ASEAN had becoming increas- ingly close The trade volume had increased from less than 9 billion US$ in 1993 to about 55 billion US$ in

2001, making ASEAN China’s fifth largest trading partner and China ASEAN’s sixth. China exported in 2001 to ASEAN around 23.8 billion US$ and imported from ASEAN at 31.5 billion US$. Among ASEAN, Singapore was China’s largest trading partner, followed by Malaysia, Indonesia and Thailand. Trade with ASEAN increased by 30% over last year and could soar to more than 65 billion US$ in 2003.

Direct Investment between China and ASEAN also increased. Before the financial crisis in Asia in 1997, most of capital would flow to invest in China. However, since 1997, one saw a reverse trend as Chinese enterprise, state owned as well as private, started to invest in cheaper ASEAN more and more.

China found out that the financial crisis had weak- ened ASEAN considerably and also heightened their fear about ASEAN’s ability to compete with China economi- cally. This concern plus the worry about China’s entrance into the WTO brought an image that China could become an economic threat to ASEAN. Realizing the importance of expanding economic relations with ASEAN and alleviating their fear, China proposed to conclude a Free Trade Agreement with ASEAN. The ASEAN-China Free Trade Area (ACFTA) would offer ASEAN members an advance opportunity to enter Chinese market under reduced tariffs before lower rates are extended to all WTO members.

At an ASEAN Summit in November 2001, China and ASEAN agreed to conclude an FTA in the next ten years.

At a China-ASEAN Summit in Pnom Penh in November 2002, China and ASEAN signed an Agreement outlining the general FTA framework, under which trade in meat, fishery products and vegetables would be liberalized in 2004. Tariffs on other products would be cut and abol- ished in stages and the FTA could be realized as early as 2015.

China viewed a FTA with ASEAN as an important driver for its economic development in the coming decades, arguing that the western region of China, less

developed than the coastal area, could benefit by tapping the market and capital of ASEAN. Moreover, China was also involved in the Greater Mekong Subregion (GMS) economic cooperation with Laos, Myanmar, Thailand, Cambodia and Vietnam.

Chinese Direct Investment in ASEAN

Number of approved outward direct investment projects in ASEAN

1999 2000 2001 2002 Cumulative value

million$

Thailand 3 13 6 15 431.0

Cambodia 1 3 7 3 214.7

Vietnam 2 17 12 20 85.0

Singapore 6 6 3 6 71.1

Burma 1 7 3 5 66.1

Indonesia 0 1 2 6 65.0

Source: Ministry of Commerce, Beijing Dec. 2003

Conclusion

It can be argued that Chinese influence in South East Asia has been increasing as a result of many factors, especially the shift in her policy and approach toward South East Asia. Although some issues still lingered on such as Chinese territorial disputes with several ASEAN members over territories in the South China Sea or that China was a major competitor with South East Asia for global investment and export markets, they seemed to be well contained. Sino-ASEAN relations are destined toward closer cooperation for mutual benefits.

China in fact sought closer economic and political ties with South East Asia after the demise of Commu- nism in East Europe, the Tian An Men incident and the fragmentation of the Soviet Union in the early 1990s, but the relationships got complicated by the South Chin Sea conflict, especially the Mischief Reef incident in 1995.

By the end of the decade the new Chinese leaders both the third and fourth generation, including Hu Jintao advocated a new security concept emphasizing multilat- eral cooperation among states, resolving differences through dialogue and peaceful settlement of conflict.

Moreover, the Chinese leasers were quite attentive to the interests and concern of ASEAN countries in seeking to develop common ground with them. Bilaterally, China pursued a good neighbour policy and signed numerous framework agreements governing relations with individ- ual South East Asian States. China was first reluctant to join the multilateral forum to discuss security issues but later actively participated and came to some understand- ing with ASEAN on several issues.

China also tried to calm regional fears over an ex- panding China-the rise of China and potential Chinese threat, through multilateral dialogue and Joint statements.

The free trade agreement was also a way to alleviate fear and to promote mutual benefits. To sum up, the main objective China in South East Asia is to preserve and enhance a regional security and economic environment conducive to domestic development and regime stability.

This aim is also shared by South East Asian nations.

References

1. See Jay Taylor, China and Southeast Asia: Peking’s relations with Revolutionary Movements, (New York: Praeger, 1974).

2. Michael Leifer, “China in South East Asia: Interde-

pendence and Accommodation,” in China Rising ed.

By David SG Goodman and Gerald Segal, (London:

Routledge, 1997), p. 156.

3. Rajeswary Ampalavanar Brown, “Oversea Chinese Investment in China: The Case of CharoenPok- phand,” China Quarterly, Sept., 1998.

4. Denny Roy, China’s Foreign Relations, (London:

McMillan press, 1998, pp. 185-191.

5. Michael Leifer, The ASEAN Regional Forum, (London, IISS, 1996).

6. Carlyle A. Thayer, “China’s New Security Concept and South East Asia,” in David W. Lowell, (ed.) Asia Pacific Security, (Canberra: Asia Pacific Press, 2003). P. 91

7. Ibid., p. 93.

8. Yang Yanyi, “ A New Approach: China’s Perception and Policy on Security Dialogue and Cooperation,”

Foreign Affairs Journal, June 2003, pp. 17-26.