China is leaping into the “One Belt One Road” (OBOR) era — a reference to the Silk Road Economic Belt and 21st Century Maritime Silk Road. In 2014, hundreds of meetings related to OBOR strategy were held in China. Entering 2015, provincial governments discussed the implementation of the strategy in local National People’s Congress and local Chinese People’s Political Consultative Conference sessions. In response to these demands, the national OBOR plan will probably be published soon. As China enters the fast lane of OBOR development, it should seriously examine the neighboring diplomatic environment in order to discover any gaps in this strategy. One such gap is the need for a diplomatic strategy targeted at neighboring Asian powers.
Asia is undergoing a major transformation, from the region with the world’s fastest economic growth to one facing the most dramatic changes to the political situation. China is the driving force and reason for this transformation and will face the most serious test from this change. If China can’t respond properly, the OBOR strategy, as well as China’s rise, could suffer a serious setback.
Historically, rising powers used to engage in land battles with opponents in order to control as much land and the surrounding waters as possible and become the strongest land-based empire. But in the maritime age, rising powers instead relied on establishing colonies and building a trade network between these colonies and the mother country. Because of this, building an unrivalled naval fleet was critical. The United States, which became the world’s most powerful country after World War II, was influenced by a century and a half of isolationism and mercantilism. Its way of governing the world was not to expand its territory, but to protect the free trade system. This was a major purpose behind establishing the Bretton Woods institutions, the General Agreement on Tariffs and Trade and the World Trade Organization, and even the United Nations itself. It was also a driving force behind the establishment of U.S. overseas bases.
Under the free trade system, the U.S. could show it comparative advantage in the economic sphere, and come to dominate and control the world market. This also made it easy for the U.S. to export its values. In the 21st century, America’s comparative advantage lies in the service sector, so it strongly pushed for free trade in services (with bilateral investment treaty as the primary model). When it comes to the trade of merchandise, the U.S. emphasizes “fair trade” as it seeks to promote domestic re-industrialization.
Against this backdrop, China has become the world’s second largest economy and is likely to be the largest by 2030. China has laid the economic foundation for developing into the world’s number one overall power. No matter whether China can replaced America’s global role and status, becoming the most powerful country in overall terms will mean China has realized “national rejuvenation.”
Since the 1990s, China’s diplomacy has centered on partner relationships, built on the foundation of a non-alignment policy. China thus maintained good overall relationships with neighboring countries. However, that foreign policy approach fit with the period of “keeping a low profile” (tao guang yang hui). The current situation is different: the U.S. is pursuing a “rebalance to Asia”; Japan accelerating steps toward national normalization; India’s economy is growing rapidly. In the eyes of neighboring Asian countries, China’s rise isn’t entirely positive; their wariness toward China is increasing. In response to the situation, Beijing has put forward its OBOR strategy. The goal is threefold: to deal with the U.S. through “new type major country relations,” to build several routes for the Maritime Silk Road, and to set up an interconnected, interoperable system on the Eurasian continent (particularly in the central and eastern regions).
However, Beijing knows quite well that it cannot be like the U.S., acting as a “neighbor” to nearly 200 countries around the world. To seek the power and influence of a global power., one must first have a good strategy for the regional situation. When it comes to regional diplomacy, China has moved from viewing itself as simply as East Asian country to an identity as part of Central Asia and a main power on the Eurasian continent. This means China is clearly returning to a traditional regional focus: paying attention to all of China’s neighbors rather than some of them.
The issue is that China has a large number of neighboring states. It is bordered by 14 countries, and has more than 30 “neighbors” if we count nearby states that don’t actually border China. Considering the huge differences among these neighbors, China cannot (and should not) use a single principle, standard, or policy in implementing its OBOR strategy. In other words, Beijing must to categorize these countries in order to find a balance between its own diplomatic policies and the demands of its neighbors. Generally speaking, this categorization results in a threefold policy.
For the medium and small countries, it’s best to use the principles agreed on in 2002: building friendship and partnership with neighboring countries; building an amicable, tranquil and prosperous neighborhood; a new security perspective of mutual trust, mutual benefit, equality and cooperation; and jointly building a community of common development and shared interests. For those ASEAN states who are claimant in the South China Sea, these principles can still work. China needs to handle South China Sea issue under the China-ASEAN framework and to “manage differences and strengthen cooperation.” To this end, China must develop a “dual-track approach” and accelerate the formulation of a South China Sea Code of Conduct.
The second group involves neighboring “pivot states.” Here, pivot states must have two characteristics: reliability and a certain amount of strength. Accordingly, countries that hope to become “pivot states” for China are often not the strongest states in their sub-region; they are secondary or even small states. Pakistan in the southwest, Cambodia and Singapore in the southeast as well as Turkmenistan in western Asia all need China both economically strategically and wish to be considered as “reliable” by Beijing. Thus, they are very likely to become pivot states. Uzbekistan is the most populous country in Central Asia; however, it resists regional integration and frequently stalls cooperation in the Eurasian Union and Shanghai Cooperation Organization. As a result, this state could hardly become a pivot state for Beijing. South Korea, Thailand, Myanmar, and Malaysia also need China economically and to some extent strategically. These countries could become pivot states as well.
But because these states have limited power and influence in their respective sub-regions , it will be difficult for them to play a leading role in their neighborhoods. These states are an important object of the OBOR strategy. However, China can only offer financial support (based on strict assessments) for the projects proposed by those countries. China cannot do everything for these countries.
The group that needs special attention are the neighboring great powers, that is, the most powerful countries in their sub-regions. Although Russia is a comprehensive strategic partner to Beijing, it won’t be discussed here as it is not as Asian country. West Asia lacks a true regional power; Iran, Saudi Arabia, and Turkey each only have partial strength in specific areas. But Kazakhstan to China’s west, India to the southwest, Indonesia to the southeast and Japan to the northeast are all classic sub-regional great powers (of course, this doesn’t mean that their status is limited to their respective sub-regions). is all typical sub-regional great power (we don’t mean that their powers are only limited with in this sub-region). Yet when it comes to these countries, China’s current diplomacy lacks a systemic approach.
Great powers are indispensable in global affairs and their role cannot be replaced by medium and small countries. Similarly, the role of regional power in solving regional issue cannot be replaced by other states. Therefore, China must take these states seriously in its OBOR strategy. What should Beijing do?
U.S. experiences in global governance can provide some suggestions to China. Generally, the U.S. supports the second greatest power in each region, setting up alliance with them or providing security to them when necessary, in order to balance out the dominant power in this region. At the same time, Washington maintains frequent interactions and establishes close economic and cultural ties, sometimes even military communication, with the largest powers, both to secure mutual benefits and to ensure the U.S. has ways to influence these regional powers. Setting up institutions and platforms (such as the U.N. Security Council and the G20) that can be used to influence major countries is another prominent characteristic of U.S. global governance.
The four countries listed above are the greatest powers within their sub-regions and have more influence in regional affairs than the other countries. They have close economic ties with China but have kept their distance from Beijing on security issues. At the same time, they have close security relationships with great powers outside of the region.
But these sub-regional great powers have different features. Kazakhstan, undoubtedly the strongest country in Central Asia, has a relatively developed economy and is positive toward the Silk Road Economic Belt. Long-serving President Nursultan Nazarbayev has strategic vision and fresh ideas for regional cooperation. In 1992, he pushed for establishing CICA as Asia’s collective security mechanism. In 1994, he proposed the Eurasian Union.
Meanwhile, Indonesia, the world’s largest Muslim country, has a stable political environment and has kept up a growth rate of more than 5 percent for the last decade. Indonesia is expected to become a powerful leader in ASEAN. In terms of security issues, this country has a louder voice than the other ASEAN member states. Its ambition of becoming a maritime power meshes will with the Maritime Silk Road strategy.
Japan will retain its status as a global economic heavyweight. Its medium-term national policy focuses on promoting national normalization through strengthening Japan-U.S. relations. Recognizing China’s rise (and concerned about a corresponding decline in Japan’s influence on Asian affairs), Tokyo remains cautious about strengthening political and economic ties with China while it makes effort to keep its influence in Asia.
India, with unrivaled cultural confidence and high political ambitions, has always been eager to become an strong state with power an influence, one free of external interference. Recently, India has been strengthening its economic ties with East Asian countries and seeking a greater voice in Asian affairs.
Each of these countries faces obstacles to becoming a comprehensive leader in Asia: a marginalized location; small territory; fairly low GDP (with the exception of Japan); limited political influence. By contrast, China has overcome the above issues and is still rapidly rising.
As a result, in the process of carrying out its OBOR strategy and conducting neighborhood diplomacy, it is both necessary and reasonable for China to carry out Asian great-power diplomacy targeted at these countries. By doing so, China can display a new type of international relations, with win-win cooperation as the core. Considering the economic status of these five countries, it is worthy considering founding an “G5-Asia” to strengthen economic ties among this group, thereby promoting overall Asian economic cooperation.
In the end, OBOR and neighborhood diplomacy are long-term strategies and should not be limited to economics. When it comes to military and security affairs, mechanisms for cooperation among these five countries still aren’t mature enough. However, there’s no reason not to strongly promote cultural cooperation.
Even if the overlaps of different civilizations in Asia used to serve as a main cause of wars and conflicts, we still can view it from an optimistic perspective: this diversity is Asia’s pride. Asia has served as fertile ground for many different cultures, ultimately breeding most of the world’s major civilizations. After hundreds of years’ worth of religious and civilizational strife, it is time to explore the coexistence of different civilizations. In this respect, Asia is the world’s best testing ground and could see a breakthrough in solving religious and historical problems. Therefore, China should push for cultural exchange mechanisms, like an “Asian Civilization Dialogue.”
Dr. Xue Li is Director of Department of International Strategy at the Institute of World Economics and Politics, Chinese Academy of Social Sciences. Xu Yanzhuo received her doctorate from Durham University (UK) in December 2014 and studies international responsibility, South China Sea disputes, and Chinese foreign policy.
A previous, Chinese-language version of this piece appeared on the Chinese website of the Financial Times.