3. CHINA-ASEAN TIES IN POLITICAL PERSPECTIVE
3.2. Security Cooperation
3.2.2. China’s New Security Concept (NSC) and Southeast Asia
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cooperation in non-traditional security sectors. In accordance with the spirit of the ADMM-Plus, the People’s Liberation Army personnel sent by China to assist at the first ADMM-Plus Humanitarian Assistance and Disaster Relief and
Military Medicine Exercise in Brunei. Lastly, the cooperative mechanism is a positive force in regional security cooperation, focusing on practical cooperation through joint defense and security exercises. This type of security cooperative pattern supports countries in the region to cooperate in non-traditional sectors and share common interests.
3.2.2. China’s New Security Concept (NSC) and Southeast Asia With the emphasis on its peaceful development, China should realize its role in stability of East Asia and avoid its hegemonic acts. Also, China has been actively wiping out the suspicion from its neighboring countries in the pursuit of their understanding and trust. When China publicized NSC at the ASEAN Regional Forum (ARF) conference in 1997, Southeast Asia was a main follower. The concept of NSC elaborates China’s blueprint for developing its international relations in the post-Cold War period, highlighting regional cooperative security, multilateral security dialogue mechanism on confidence-building and peaceful resolution of territorial disputes. However, China’s NSC expects to remove voice of resistance to its intentions and supposes its pursuit of values and norms to be consistent with those of ASEAN. (Roy, 2005) In 2000, China further set out NSC to Southeast Asia when the then-Chinese vice president, Hu Jintao paid a visit to Indonesia. China claims that NSC represents a separation from the bipolar system, and embraces a multipolar international system in which China will become a more influential force. Although China first opposed the idea of a multilateral security model, it soon realized the participation in multilateral
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activities could be a counterbalance against the U.S. Consequently, China put multilateralism as the main element to its NSC to obtain an alternative to forge an alliance with the U.S. while it considers U.S.-Philippines treaty and the U.S.-Thailand defense commitment as weak bonds. (Thayer, 2003) 3.3. The Potential Security Threats in Southeast Asia
3.3.1. Non-Traditional Security in Southeast Asia: Trends and Issues With the expansion of globalization, China and ASEAN members have encountered the non-traditional security problems. (Collins, 2003) These emerging non-traditional security threats arising out of non-military sources in both China and Southeast Asia would be challenges to the well-being of states, such as terrorism, contagious diseases, irregular migration, food security, human smuggling, drug trafficking and other forms of transnational crime. Owing to globalization and the information revolution, most of them arise at a very fast pace. (Caballero-Anthony, 2010) The following are common non-traditional security threats.
Terrorism
Terrorism is the main threat among ASEAN states, Indonesia, the Philippines, Malaysia and Thailand in particular. After 911 incident, terrorism became the key issue of non-traditional security threatening the world and emerged as the main security challenge to ASEAN states. Southeast Asia has thus been considered by the U.S. to be the second battlefield to combat against terrorism. China and ASEAN states released Joint Declaration of ASEAN and China on Cooperation in the Field of Non-traditional Security Issues in 2002 and signed Memorandum of Understanding Between The Governments of the Member Countries of the Association of Southeast Asian Nations (ASEAN) And The Government of the
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People’s Republic of China On Cooperation in the Field of Non-traditional Security Issues in 2004, aiming to fight against drug trafficking, illegal immigrant, privacy, terrorism, weapons smuggling, money laundry and cybercrime.
Epidemic
When severe acute respiratory syndrome (SARS) broke out in East Asia in 2003, some Southeast Asian countries like Vietnam and Singapore were identified by WHO as the areas with recent local transmission of SARS. The economy of Southeast Asia was thus severely damaged.
Maritime Security
The Southeast Asian Waters, including Strait of Malacca, are the places where piracy is the most rampant. According to International Maritime Bureau, approximately 800 pirate attacks, half of them happened at the ports and waters of Southeast Asia from 2003 to 2004. Moreover, the level of violence in attacks continues to rise.
Environmental Security
Take the example of forest fire in Indonesia in 1997; it resulted in smog, which the pollutants had heavily influenced Indonesia and its neighboring states, especially Malaysia and Singapore. The total loss reached 9.3 billion dollars.
Consequently, Malaysia, Brunei, Singapore, Thailand and the Philippines urged Indonesia to correspondingly apply strategies for the pollution through ASEAN regional cooperative mechanism.
Energy Security
With the rising economic growth among ASEAN members, the consumption of oil has also been rapidly increasing. As a result, the issue of energy security
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regarding high and growing dependence on oil imports becomes crucial to the countries like the Philippines, Thailand and Singapore. Moreover, the price of crude oil has greatly increased, severely damaging the economy of
mentioned-above countries.
Transnational Crimes
Transnational crimes in Southeast Asia are rampant, like drugs production and smuggling at the Golden Triangle at the Thai-Myanmar border, the smuggling of small arms and light weapons in the Philippines and Cambodia, trafficking in women and children in the Philippines, Thailand and India, human trafficking between India and Malaysia as well as between Thailand and Cambodia, and armed pillage in the Strait of Malacca and Indonesia waters. And the
consequences have a bad influence on political stability, economic development, and social unrest in ASEAN states, which thus becomes one of the important issues among ASEAN nations.
Non-traditional security issues have shown that insecurity among Southeast Asian people could potentially undermine the ASEAN region. With the emergence of non-traditional security threats, the call for multilateralism
becomes urgent to foster cooperation between China and Southeast Asia through ASEAN-based multilateral institutions such as ARF, APT and EAS.
As the representative in non-traditional security, terrorism gradually threatens the world after 911 incident. Compared with China, ASEAN countries have been threatened by terrorism for many years because of the large Muslim population.
Southeast Asia is thus considered the second battlefield on terrorism by the U.S.
In 2002, China and ASEAN countries also issued “Joint Declaration of ASEAN and China on Cooperation in the Field of Non-traditional Security Issues”, and
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signed “ASEAN-China Memorandum of Understanding on Cooperation in the field of Non-Traditional Security Issues” in 2004. Under the declaration and the MOU, China and ASEAN aim to combat terrorism, drug smuggling, illegal immigration, privacy, money laundry and cybercrime. In the meanwhile, China and ASEAN also seek bilateral, multilateral and international cooperation. The U.S. global anti-terror strategy enhances China-ASEAN anti-terror relations.
Plus, China’s stabilizing economic development intensifies China-ASEAN anti-terror relations in the field of non-traditional security. The cooperation in non-traditional security between China and ASEAN will be long-lasting.
3.3.2. China’s Land Boundary Issues with Vietnam and Myanmar In the late 1980s, Sino-Vietnam relations gradually got improved, so both sides reopened the negotiation on the border issue. China and Vietnam first tried to deal with was the land border dispute. Sino-Vietnamese border is approximately 1,350 kilometers in length, which the two parties had a disagreement for about 450 kilometer. In 1992, China and Vietnam held the first talk on the territorial dispute, but the negotiation wasn’t very successful due to the disagreement between both sides at the beginning. After several negotiations, both parties finally signed a Land Border Treaty in 1999. To solve the dispute as soon as possible, both governments established the China-Vietnam joint committee for land border demarcation in 2001, where two sides drafted a protocol on border demarcation and marker planting. China and Vietnam successfully resolved the disputes over their land border in 2000, and also marked out a process of peaceful resolution and guarantees against through a joint agreement between China and ASEAN in 2002. In 2009, two sides even signed several official documents regarding China-Vietnam land border demarcation in Beijing,
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including The China-Vietnam Land Border Demarcation Protocol, The China-Vietnam Land Border Management System Agreement, and The China-Vietnam Land Border Port and Management System Agreement.
Another notable border dispute between China and Vietnam is the first for maritime right in Gulf of Tonkin. The Gulf of Tonkin is located in the northern part of South China Sea, to the south of China and the north of Vietnam. The maritime disputes between both sides are mostly centered on the Spratly islands and the Paracel Islands. In 2004, China and Vietnam signed Sino-Vietnamese Fisheries Agreement to demarcate a common fishery zone in the Tonkin Gulf.
Although Vietnam asserts its sovereignty over the Spratly islands, the country is unable to claim rights to the Paracel islands on the basis of the international law and historical background. What’s more, the Spratly islands are still under China’s control.
The Chinese-Myanmar border disputes dated back to Qing dynasty. The then-local chieftains were subordinate to Myanmar and the Qing court. In addition to complicate mapping and geographical exploration, the disagreement on sovereignty between the Qing government and British negotiators also made it difficult to draw a clear line of demarcation. In the nineteenth century, British colonial ruler in Myanmar and Chinese government signed a series of
border-related treaties or agreements, like the Burmah Convention in 1886, Supplementary Terms to the Sino-Burmese Borderline and Business in 1894 and 1941 frontier line. These treaties generally draw the outline of China-Myanmar border. However, both sides still owned different views on the border
demarcation. In the twentieth century, Chinese government didn’t recognize McMahon Line during the negotiation of China-India and China-Myanmar
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border. To date, China still maintains an intransigent position on this issue. But to feed Myanmar’s receptivity, China also takes it into consideration when the country solves the border issue. Therefore, China and Myanmar are
well-coordinated the issue by not recognizing the legitimacy of McMahon Line and meanwhile demarcating the border through traditional customary boundary line.
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4. CHINA-ASEAN ECONOMIC OUTLOOK 4.1. Trade Facilitation
4.1.1. A Look at “ASEAN Plus Three” Framework
The ASEAN states have been impaired by the 1997 Asian Financial Crisis while China played a role as a positive force in this crucial period. The 1997 Asian Financial Crisis was succeeded by the ASEAN+3 Framework, which was formed by China, Japan and the Republic of Korea (ROK) with ASEAN to cooperate on some regional issues. Within the framework, China and ASEAN held a series of efforts on monetary and economic cooperation. Obviously, China is filled with ambition to look for regional economic cooperation to be a pivotal role in this region. As a consequence, China proactively took part in all aspects of regional integration and international cooperation events to raise its profile. Indeed, China has embarked a new phrase of economic relations with ASEAN. Both sides have seen tremendous achievements in commerce and trade with each other. On the sector of financial and monetary cooperation, the Chiang Mai Initiative
Multilateralization (CMIM) and the Asian Bond Market Initiative (ABMI) have been the focus to keep the progress of economic cooperation steady. The
foundation of CMI aims to expand currency swaps of ASEAN, but the
organization didn’t work as expected during 2008 Financial Crisis. As a result, the crisis gave a birth to the CMIM in 2008 with the support of APT
Macroeconomic Research Office (AMRO) to multilateralize the initiative. The most remarkable achievement of CMIM was to direct regional liquidity to meet the needs by increasing the proportion of CMIM Fund from US$120 billion to US$240 billion.
The leaders from ASEAN+3 states decided to hold a ASEAN+3 summit annually
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in 1998 to expand cooperation in the fields of economy, politics and culture exchange. However, the economic issue is always a priority among the regional issue due to the Asian Crisis. As a consequence, finance, trade, environment, labor, agricultural and tourism have been the focus of discussion within APT framework since 2000. (Suzuki, 2004) Besides, to ensure free flow of goods among APT nations, tariffs and non-tariffs barriers were gradually removed on the basis of the agreement of WTO resolutions and preferential tariff treatment to products of least developed countries. Without tariffs and non-tariffs barriers on China-ASEAN trade, the trade volume of bilateral trade has been increasing in an uncertain global economy. In 2013, total trade between ASEAN and the Plus Three countries grew by 1.8%, making USD$ 726.4 billion with occupation of 28.9% of ASEAN’s total trade, in which ASEAN goods imported from the Plus Three countries recorded an increase by 2.1% while ASEAN goods exported to the Plus Three countries rose by 1.5%. (InterAksyon.com, 2014)
4.1.2. CAFTA Initiative Gave China a Diplomatic Advantage
Looking back on China-ASEAN relations during post-Cold War era, there are four features in the bilateral ties. First, the absence of ideological rivalry between China and Southeast Asian countries was gradually restored to amity, which gave China-ASEAN ties an opportunity to establish diplomatic relations with each other by 1991. Secondly, the vital role of economic interdependence created several multi-level cooperative mechanisms in China-ASEAN relations, which makes economic diplomacy a central aspect of China’s foreign policy. China’s involvement in a range of multi-level and multi-sector cooperation with ASEAN since the 1990s was part of China’s “Good Neighbor Diplomacy”. Bilateralism was actually the leading idea of China’s diplomacy in ASEAN. In the view of
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ARF’s creation in 1994, however, several multi-level and multi-field cooperation are greatly developed. Among regional cooperative mechanisms, CAFTA is undoubtedly a landmark in China-ASEAN economic cooperation. Thirdly, the Spratly territorial disputes and the ASEAN-China interactions are inextricably linked. Lastly, emerging multilateralism in China-ASEAN diplomacy is
considered an indicator on diplomatic interaction between China and the ASEAN nations. (Chwee, 2005)
Multilateral diplomacy actually existed in the Asia-Pacific region, which its distinguishing characteristics are increasing interaction, reaching a consensus and clearing disagreement with other regional countries. ASEAN is exactly a multilateral organization, but it was widely criticized after the 1997 Asian
Financial Crisis broke out since the organization wasn’t expected to play a role to provide stability and resource and to solve the financial problem in this region.
When the financial crisis ended, regional free trade area became a hit subject. In fact, ASEAN proposed the concept of free trade area in the early 1990s and took active measures to enhance regional economic cooperation. Nowadays, major achievement in China-ASEAN relations is the growing economic cooperation between the two sides. When the ASEAN+1 framework launched after the 1997 Asian Financial Crisis, the bilateral economic partnership also moved to a new level. In truth, the bilateral trade volume was 36 times as much as that in the early 1990s, which is even expected to reach 500 billion U.S. dollars in 2015.
ASEAN member states have benefited a lot from China’s rapid and marvelous economic growth. At the ASEAN Summit held in 2000, both China and ASEAN reached a agreement on the improvement of strengthening economic cooperation and integration between the two parties. The cooperative mechanism was
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advanced to China-ASEAN FTA to reinforce complementarities with each other.
(Chirathivat, 2002) Since the launch of CAFTA in January 2010, the average tariff rate of Chinese goods to ASEAN nations has reduced to 0.1% from 9.8%.
So far, CAFTA has a population of 1.9 billion, its GDP is approximately USD$ 6 trillion. The trade value of this area is also close to USD$ 4.5 trillion, making it the most populous free trade area on the globe with the world’s third largest trade volume after European Union (EU) and North American Free Trade Area
(NAFTA). China and ASEAN launched the CAFTA with the intention to harvest tangible economic benefits from the collaboration among eleven nations by 2010.
In the context of China’s rise in Southeast Asia with its giant economy, it’s not hard to find that in three ASEAN countries, Singapore, Malaysia and Thailand, per capita GDP is actually higher than China while in two ASEAN states, Indonesia and the Philippines, per capita GDP is below China, have developed industrial and modern service sectors for forty years. Even though Cambodia, Laos, and Vietnam were heavily hit by domestic insurgencies or internal and external strife, these countries contrived to lift growth in GDP at a remarkable pace since the early 1990s. (Booth, 2011) Consequently, in the past decade, bilateral trade volume between China and ASEAN had quintupled reaching USD$ 213 billion in 2009 up from 41 billion U.S. dollars in 2001. (Wang and Tong, 2013) (See Table 4-1 and Table 4-2)
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CHINA-ASEAN TRADE, 2001-2013 (USD billion)
China’s Exports to ASEAN China’s Imports from
ASEAN China’s Trade
with
Table 4-1. CHINA-ASEAN Trade, 2001-2013
Source: Wang and Tong (2013); The Ministry of Commerce, PRC (2015)
China recorded trade deficits with ASEAN members until 2012. The trade deficit has turned into trade surplus since 2012, when China’s trade surplus with
ASEAN came to USD$8.5 billion by2 percent of the trade value, reflecting an almost balanced trade. Over the past decade, it’s obvious to see China-ASEAN trade volume has increased from USD$54.8 billion in 2002 to USD$ 400.1 billion in 2012.
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Country Exports Value
Table 4-2. CHINA-ASEAN Trade by Country, 2013
Source: Journal of Economics and Sustainable Development (2014); The Ministry of Commerce, PRC (2015)
The ASEAN thus has become China’s third biggest trading partner, and China also evolves to be the largest trading nation for ASEAN, which reflects China’s emerging economic clout in this region.
4.1.3. Taking ASEAN+1 FTAs towards the RCEP
In recent years, the most noticeable cooperative platform between China and ASEAN is undoubtedly Regional Comprehensive Economic Partnership (RCEP), which is the ASEAN-centered regional FTA, comprising the ten ASEAN
members and six other countries, namely Australia, China, India, Japan, South Korea and New Zealand. The RCEP pattern is advocated by China on the basis of large regionalism initiatives. RCEP intended to be a counterbalance to the U.S., but it will be likely to evolve into distinct institutional mechanism that pushes China and the other Asian states to cooperate on the threshold of
problems. Moreover, the RCEP negotiation framework provides more additional
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bargaining power and more substantial commitments to ASEAN. (Fukunaga and Isono, 2013)
Time Incident
November, 2004
The leaders from ASEAN+3 states advocated establishing East Asia Summit.
December, 2005
The first East Asia Summit was held. The participants include ASEAN states, China, Japan, South Korea, New Zealand, Australia and India (ASEAN+6).
August, 2006
Japan proposed to establish Comprehensive Economic Partnership in East Asia (CEPEA). The members include ASEAN states, China, Japan, South Korea, New Zealand, Australia and India (ASEAN+6).
January, 2007 – August, 2009
Discussion on feasibility of CEPEA
October, 2010
East Asia Summit declared to integrate the resources through ASEAN+1.
August, 2011
The 43th ASEAN Economic Official Meeting (AEM) first proposed a FTA that would be developed among 16 countries and quickly got the support from 6 countries.
November, 2011
The 19th ASEAN Summit officially proposed the FTA that aims to bring together the 16 countries into a big economic
partnership, which is called Regional Comprehensive Economic Partnership (RCEP) on the basis of Framework for Regional Comprehensive Economic Partnership.
November, 2012
The 21st ASEAN Summit declared that RCEP negotiations are scheduled for 23-27 September 2013.
Table 4-3. Timeline of Development of RCEP
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Source: Itakura (2013)
Note: Five ASEAN+1 FTAs refer to AANZFTA, ACFTA, AIFTA, AJCEP and
Note: Five ASEAN+1 FTAs refer to AANZFTA, ACFTA, AIFTA, AJCEP and