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China-ASEAN Relations: Perspectives, Prospects, and Implications for U.S. Interests

Authored by Dr. Jing-dong Yuan. | October 2006

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Since the mid-1990s, China and the Association of Southeast Asian Nations (ASEAN) have developed a growing partnership in security cooperation, economic/ trade interdependence, and the development and sharing of ?Asian values.? Compared to the late 1980s and early 1990s when Beijing had yet to establish or normalize diplomatic relations with key ASEAN member states and when the concerns over the ?China threat? both drove Southeast Asia?s armament and military buildup and were the major rationale for initiating a regional security arrangement to keep the United States engaged, the current state of China-ASEAN relationship is truly remarkable. While a China and Southeast Asia living in harmony contributes to regional peace, stability, and prosperity and minimizes the potential for conflicts over unresolved territorial disputes, the future direction of this relationship nevertheless could have major implications for longterm U.S. interests in the region, especially if it evolves into a competitive and even exclusive regional trading bloc and a geo-strategic arrangement under the shadow of a growing and more assertive China.

This monograph describes the evolving China-ASEAN relationship over the past 15 years and examines the key elements of this relationship in the areas of economic/trade interdependence, security dialogue and cooperation, Chinese diplomacy in expanding influence in the region, China-ASEAN efforts in managing the unresolved territorial disputes, and the ASEAN member states? continuing concerns about and the hedging strategy against an ever growing China. Three underlying themes are interwoven with the discussions of both chronological developments and major issues in this study. The first describes Beijing?s post-Tiananmen diplomatic offensive: a good neighborly policy of establishing and restoring diplomatic ties with key ASEAN member states. It assesses how the changing environments at both the international and regional levels drove Chinese foreign and security policy during the initial post-Cold War period where the disintegration of the former Soviet Union effectively had reduced the utility of the ?China Card? and hence its strategic importance in the strategic triangle. A more focused Asia policy of necessity led to greater attention to Southeast Asia.

The second theme relates to how ASEAN, alarmed by Beijing?s growing military buildup and the assertive irredentism regarding the territorial disputes in the South China Sea, sought to both keep the United States engaged in the region?s security arrangements and socialize a China that remained suspicious of multilateralism and the concepts of cooperative security, dialogue processes, and Track-II initiatives. Through the ASEAN Post-Ministerial Meetings and the establishment of the ASEAN Regional Forum (ARF), the Southeast Asian nations were able to socialize, assure, and obtain assurance from China that the ASEAN Way could be the model for developing regional security institutions. At the same time, from the mid-1990s onward was also the period that saw increasing economic ties between the two and, in the wake of the 1997 Asian financial crisis, China?s position as a major market and source of low-cost production became more important to the recovery and sustainability of the Southeast Asian economy.

The third highlights the major developments over the past 5 years where the political, economic, and strategic elements of China-ASEAN have become even more pronounced in the forms of the China-ASEAN Free Trade Area, the ASEAN +3 process, and China?s accession to the ASEAN Treaty of Amity and Cooperation and the signing of the 2002 Declaration on the Conduct of Parties in the South China Sea. It examines the key factors driving these developments and speculates on their long-term impact on the transformation of the region?s geo-strategic and geoeconomic landscapes and the implications for U.S. interests in the region. In particular, the monograph discusses the ASEAN states? lingering unease over China?s growing power and their hedging strategies, including continued and even intensified security ties with the United States.


Relations between China and the Association of Southeast Asian Nations (ASEAN) and its member states have undergone significant changes over the past 15 years. When Beijing first established official contacts with the original ASEAN-6 in 1991, it barely had restored diplomatic relations with Indonesia, had begun to normalize relations with Vietnam, and just had established diplomatic ties with Singapore. There were strong suspicions, as well as concerns, among ASEAN member states over China?s growing power and intentions toward Southeast Asia. History aside, Beijing?s assertiveness in its claims to sovereignty over the Spratly Islands in the South China Sea, its ongoing military buildup, and the occasional uses of force in asserting its territorial claims (with South Vietnam in 1974, and with Vietnam in 1988), cast a shadow over the Southeast Asian states at a time of uncertain U.S. commitment and military drawdown in the region (e.g., the closing of the Subic and Clark military bases in the Philippines in 1991). It was no accident that the ?China threat? thesis found a receptive audience in the region?s capitals. Indeed, ASEAN?s internal and external balancing strategy in the early 1990s was very much driven by such grim assessments.

What differences a decade and half have made. Today, China and ASEAN have formed a strategic partnership for peace and prosperity, signed a framework agreement on a China-ASEAN Free Trade Area (CAFTA), and are cooperating on a range of issues of mutual interest from maritime security to nontraditional security challenges. Washington should welcome a stable relationship between China and Southeast Asia that in general contributes to regional peace, stability, and prosperity, and minimizes the potential for conflicts over disputed territories that could endanger key sea lines of communication (SLOCs). At the same time, it also is important to assess the long-term implications of growing China-ASEAN ties, and if and to what extent the emerging East Asian regionalism and greater regional integration could undermine U.S. interests in the region.

This monograph takes stock of the evolving China-ASEAN relationship over the past 15 years, examines some of the key elements of this relationship, and analyzes the implications for U.S. interests in the region. These include growing China-ASEAN economic/trade interdependence; bilateral and multilateral security dialogue and cooperation and efforts in managing unresolved territorial disputes; Chinese diplomacy in expanding its influence in the region in competition with Japan and, to a lesser extent, the United States; and the ASEAN member states? continuing concerns about and the hedging strategy against China that both offers opportunities and poses security challenges.

The monograph seeks to address the following issues. First, it tests the International Relations theory on rising powers and the challenges to the international system, and the possible reactions from other actors in the forms of either balancing or band-wagoning. Second, it looks at the question of whether China would and actually is asserting a form of benign hegemony and sinocization of the region as its influences grow. Given the extensive Chinese communities in the region, what could be the implications of a Greater China in political, cultural, and economic terms? Finally, whether, how, and to what extent continued expansion and consolidation of China-ASEAN relations reconcile with U.S. regional strategic goals of retaining primacy and sustaining economic ties. Would Washington allow Beijing to develop a Monroe Doctrine of its own in Southeast Asia, or is such an alarmist perspective unfounded? Can a modus vivendi be developed between China and the United States so that the deepening China-ASEAN relations would not amount necessarily to an assertion of Beijing?s sphere of influence, or that long-term U.S. interests demand that Washington foil any efforts to exclude American presence and participation in this part of the world that is key to major international SLOCs, in addition to being a critical part of U.S. global as well as regional strategy?


China-ASEAN relations have undergone significant changes over the past 15 years. Moving away from enmity and suspicion, bilateral ties have grown and strengthened in political, economic, and security areas. While ASEAN may still be apprehensive about China?s growing power and how it will use that power in the future relationship that ranges from the economic to the territorial, at least for the time being, China is recognized in the region as an economic opportunity, a political heavy weight, but not necessarily a military bully, even as Beijing continues to modernize its armed forces.

But ASEAN states, given their place in the international pecking order and their strong sense of protecting national sovereignty and independence and recognizing the geo-strategic realities, have resorted to various stratagems of power balancing and hedging, as well as engagement of major powers. The United States remains a key power that is welcomed to continue playing a stabilizing and reassuring role in the region, but that may not be taken for granted, especially given the large Muslim communities and ASEAN?s political sensitivity to external interference in internal affairs, coercion and/or use of force, and unilateralism and blatant display of arrogance and domineering.

The United States retains strong political influence, economic clout, and military prowess in the region. Southeast Asia remains a key battleground for the global war on terrorism and U.S. efforts to prevent WMD proliferation. While China may have gained influence in Southeast Asia over the last decade, it may not be at America?s expense. On a number of fronts, closer China-ASEAN relations actually could advance American interests in the region. China?s agreement to be bound by restraint on the territorial issue lowers the risk of military conflicts and hence major disruption of key SLOCs vital to the economic security of both the United States and its important allies in the region, such as Japan, which depend on secure and stable supplies of raw materials and energy resources. Multilateralism and cooperative security also have led to gradual improvement in Chinese military transparency which, in turn, can address anxieties in the region?s capitals, as well as in Washington and Tokyo, about the scope and intensity of the PRC?s defense modernization programs.

What may constitute the biggest threat to long-term U.S. interests lies in the economic field as China replaces America as ASEAN?s number one trading partner and as the CAFTA fully launches in the coming years and expands to the East Asian region to form the largest trading bloc in the world. But even here, the United States still holds some important cards?technology, market, and investment. But Washington?s approach must be strategic, comprehensive, and proactive rather than piecemeal, passive, and reactive. It is important to maintain solid bilateral relationships with its key allies and friends in the region, but the United States should also begin to recognize the value of the growing role and importance of ASEAN and treat the regional grouping as such.