Journal of International Affairs

Regional Security Issues

By June Teufel Dreyer

The early 1990s saw the dismantling of Cold War power relationships in Asia while providing no clear guidelines as to what arrangements might take their place. The disintegration of the Soviet Union meant that the Chinese, who had been skilled practitioners of triangular politics, could no longer play the United States off the USSR as effectively to their own benefit. The demise of the Soviet Union also removed the original raison d'Ltre  for rapprochement between the People's Republic of China (PRC) and the United States just at a point of maximum friction between the two. Chinese resentment over American reaction to the PRC's decision to forcibly suppress demonstrations at Tiananmen Square was heightened by a long list of complaints from the United States on such issues as Chinese failure to protect U.S. intellectual property rights; the huge and growing trade deficit the United States was running with the PRC; sales of Chinese missiles to the Middle East; and China's continued nuclear testing. The fact that the United States took the lead in forming an international coalition to force Iraq out of Kuwait reinforced the PRC leadership's view that America, the only remaining superpower, intended to remake the world in its own image. This stimulated a policy of Chinese resistance to perceived U.S. attempts to contain the PRC, and a vigorous assertion of its international prerogatives.

Chinese suspicions notwithstanding, the United States was drastically cutting its defense budget. The consequences of downsizing its arsenal included withdrawing from its bases in the

Philippines, reducing the number of American troops in South Korea, and renegotiating its Status of Forces Agreements so that its newly-wealthy Asian allies would assume more of the burdens of, and responsibilities for, their own defense. Initially, Asian commentators welcomed these changes. Relieved of the tensions of the Cold War, Asians, with what some saw as a distinctly Asian identity, would fend for themselves. 1 Others held forth the vision of a militarily peaceful and economically dynamic Pacific community with a unique "corporate culture" on regional security that combined the best on East and West: Western concepts of national sovereignty and organization plus Eastern attitudes on managing differences. 2

While some continued to remain optimistic, others became concerned that the disintegration of the Soviet Union and potential withdrawal of the United States had created a power vacuum which would be filled by China, either as a new emerging superpower or as hegemon in the Asian region. The first of these contentions can be dismissed: Apart from trade, China has minimal global interests to protect, and minimal global reach by which to protect them. Regionally, it is otherwise. Unresolved disputes in which China has major stake include, in order of importance:


Taiwan, known to its inhabitants as the Republic of China (ROC), is regarded by Beijing as a breakaway province. The issue of sovereignty is complicated. Taiwan was a province of the Qing 3 Empire from 1885 to 1895, when Japan annexed it under the terms of the Treaty of Shimonoseki. In 1945, the Allied Powers, victors in the Second World War, assigned Taiwan to China, which was then governed by Chiang Kai-shek's Kuomintang (KMT). Taiwan has remained under KMT jurisdiction ever since, though the mainland has been under the control of the Chinese Communist Party (CCP) since 1949. In 1991, ending four decades during which the CCP and KMT each claimed to be the only legitimate government of all China, the Kuomintang formally renounced control over the mainland. It did not, however, declare the island's independence since the CCP has stated that a declaration of independence will be met with armed resistance. The Taiwan government's official position is that it is part of China, but not a province of the PRC. 4

Taiwan's spectacular economic growth was followed by equally spectacular political development. The direct election of the president in March 1996 will be another milestone in the island's impressive democratization. Its Taiwanization, though less heralded, is taking place as well. Notwithstanding the fact that virtually every inhabitant of the Republic of China is able to speak Mandarin, increasing numbers of people prefer not to do so. Even political candidates who were born on the mainland now find it expedient to campaign in Taiwanese, 5 while literature, art and architecture show subtle, though noticeable trends away from mainland forms. It is hardly surprising that the development of this separate linguistic and cultural identity should be coupled with a desire for international recognition of the separate political identity which exists in fact. The government can, and frequently does, warn that strident assertions of independence may cause the mainland to invade. But its ability to stifle such assertions has been circumscribed by the rise of a civil society whose members are strong adherents of the right to free speech. The Kuomintang is also aware that failure to heed voters' wishes on the matter of an international persona may mean that the opposition Democratic Progressive Party will succeed it in power.

Approximately five years ago, the Republic of China began a policy known as flexible diplomacy, wherein it sought to return to international organizations that it had left when those organizations admitted the PRC. Taipei also announced that it was willing to establish formal diplomatic relations with countries even though they had formal diplomatic relations with Beijing. China's media fulminated against what it termed a bald-faced attempt to institutionalize the concept of two Chinas and suspended diplomatic relations with several small countries that recognized Taiwan.

China did no more than this, however. New policies in the Republic of China facilitated indirect trade with the mainland, and billions of dollars from Taiwan were soon invested in mainland factories, the majority in Fujian -- which is the ancestral home of most Taiwanese -- and Guangdong. There were, to be sure, frictions in the relationship. A group of Taiwanese tourists were shot and burned to death by thieves who attacked their excursion boat. And a number of illegal immigrants heading for Taiwan suffocated when roc officials, frustrated by the illegals' repeated attempts at re-entry, forced them below deck, nailed the hatches closed and pointed the boat back toward the mainland. But in general, relations between the two sides had never been better.

This changed during the earlier part of 1995. The year opened peacefully. On January 30th, Chinese president and CCP general secretary Jiang Zemin delivered a major speech calling for a cross-strait summit on reunification 6 that was generally regarded as conciliatory. A major sticking point, however, lay in China's insistence on party-to-party negotiations while Taiwan insisted on government-to-government relations. The Kuomintang government cannot agree to party-to-party negotiations because Taiwan is a multi-party state and its highly vocal rival parties would object strenuously. The CCP government cannot agree to government-to-government negotiations, since this might imply tacit recognition of Taiwan's sovereign status. The Taiwan authorities were additionally constrained in their ability to hold even informal negotiations by opposition parties' suspicions that the Kuomintang intended to make political capital out of the negotiations to enhance its chances in upcoming elections. 7

By springtime, the mainland's line had hardened. Unconfirmed rumors said that hardliners, never happy with Jiang's conciliatory gesture, were using the overture's lack of results to attack Jiang. The general secretary, a weak leader who owed his appointment to Deng Xiaoping, was becoming increasingly vulnerable as his mentor's health failed. This forced Jiang to take a tougher stance. Not only had his initiative produced no noticeable progress toward reunification, but Taiwan authorities appeared to be stepping up activities that would establish the principle of two Chinas. High-ranking roc diplomats including Foreign Minister Frederick Chien and Government Information Office Director-General Jason Hu circled the globe in support of the roc's efforts to join the United Nations. China was not mollified by the pointing out that the presence of both East Germany and West Germany in the United Nations was merely a transition stage toward reunification, and that the presence of both Koreas in the United Nations might be said to have facilitated rather than prevented reunification discussions between the two.

Furthermore, China reacted sharply to the Clinton administration's May 1995 announcement that it had reversed its past policy and agreed to grant roc president Lee Teng-hui a visa so that he could receive an honorary degree from Cornell University, his alma mater. The U.S. decision to reverse past policy was made for domestic political reasons, as an angry Congress threatened to force the issue on the already beleaguered American president. But Chinese leaders protested loudly that they had been lied to by U.S. Secretary of State Warren Christopher, and accused the United States of complicity in a sinister plot to create two Chinas.

The mainland announced, and subsequently carried out, missile testing exercises in the Taiwan Strait in July and August. Shortly thereafter, war games were held which looked suspiciously as if they might be the prelude to an actual invasion. The Taipei Stock Market dropped sharply, though it recovered within a few days. And Taiwan announced its own war games, held just before the anniversary of the 10 October 1911 revolution against the Manchus, since celebrated as the Republic of China's national day.

At this point, tensions began to diminish. The reasons are unclear; perhaps each side felt it had made its point and that it was time to retreat from the brink. The matter of U.N. membership remained in abeyance as, for the third year in a row, China amassed enough support to delete consideration of Taiwan's petition for membership from the General Assembly's agenda. No new military exercises were announced by either side and cross-strait economic exchanges continued to develop, albeit on a somewhat reduced scale. Taiwan's investment on the mainland is thought to exceed $5 billion, and is important to both sides. China welcomes the infusion of capital and managerial expertise and local workers appreciate the added employment opportunities. Also, roc business people benefit from the PRC's lower wage scale, since labor shortages on Taiwan bid up salaries to the point where many businesses were on the verge of losing their competitive edge.

The Spratly Islands  

The Spratly (Nansha) Islands comprise no fewer than 104 islands, reefs, cays, and banks covering an area nearly 900 kilometers on both their north-south and east-west axes. Although the islands themselves are in general uninhabitable, they lie astride important sea lanes and are believed to have important offshore oil deposits. Five states in addition to China claim all or part of the Spratlys: Taiwan, Vietnam, the Philippines, Malaysia and Brunei. There are other contested islands in the area too: Vietnam and China have competing claims to the Paracels (Xisha), and China, Taiwan, Japan and South Korea dispute ownership of the Senkaku (Diaoyu) islands. But it is the Spratlys that are most likely to provoke open confrontation.

In March 1988, Chinese and Vietnamese forces engaged in an inconclusive encounter in the Spratlys which each side accused the other of having initiated. The clash probably occurred when Vietnamese ships attempted to observe Chinese construction activities on two reefs claimed by both sides. Since the reefs are submerged for part of the year, structures would be needed for China to be able to assert a claim of continuous occupation under international law; although Vietnam actually did have troops stationed year-round on 10 small islands, China had never established a permanent garrison. China and Vietnam strongly reiterated their respective intentions to protect territory they believed they were entitled to, however, there were no follow-on clashes. In February 1992, the PRC's National People's Congress passed a law asserting China's ownership of not only the Spratlys but a large number of other islands including the Paracels, the Senkakus and Taiwan. It also claimed the right to "adopt all necessary measures to prevent and stop the harmful passage of vessels through its territorial waters" and for "PRC warships or military aircraft to expel the intruders." 8

These unilateral actions on issues which most claimants believed should have been settled through international negotiations disquieted a number of countries. When it appeared that a long-awaited visit by the Japanese emperor might be jeopardized, 9 the Chinese foreign ministry attempted to soften the impact of the law, explaining that it was part of a normal domestic legislative process, did not represent a change in Chinese policy, and would not affect the joint development of the islands with countries involved in the dispute. 10 This, of course, begged the question of why it had seemed necessary to pass the law in the first place. The foreign ministry's explanation did not totally assuage regional anxieties, especially when, in May, China granted oil exploration rights in a disputed area to the United States-based Crestone Energy Corporation. Nonetheless, the issue gradually faded from public debate.

In spring 1995, however, concerns arose anew when the Philippines announced that China had built concrete structures, including radar installations, in a contested area aptly named Mischief Reef. When the PRC asserted that these were merely for the convenience of its fishermen and had no military significance, Filipino president Fidel Ramos arranged a media tour that revealed facilities far more elaborate than fishermen would normally need or expect. He also ordered Chinese boundary markers, presumably meant to demarcate China's territorial waters but located only fifty miles from the Philippines' Palawan province, blasted away. The PRC warned against any repetition of these actions, saying that even another media tour might be met with Chinese military action, accused the Philippines of bullying China, told its government not to involve the Association of Southeast Asian Nations (ASEAN) or the United States in the issue, and stated that the restraint showed by the Chinese side over the Spratlys could not be permanent. 11 At the same time, while reiterating China's "principled stance," it suggested a fishing cooperation agreement that would prevent Chinese fishermen from being arrested near Philippine territorial waters. The PRC's Mischief Reef dJmarche  could be construed in terms of a traditional Chinese admonition "to kill the chicken in order to warn the monkey"in this case, to deliberately create a minor incident with a weak adversary in order to send a message to a larger, and at least collectively, more powerful, group to withdraw. The greater power of the collectivity was also presumably the reason why China insisted on bilateral negotiations to settle boundary disputes and adamantly resisted multilateral efforts to resolve questions which concerned several countries.

A few weeks later, Indonesia announced that it had come into possession of a Chinese map showing the Natuna Islands as part of China's exclusive economic zone. Since the Natunas, which contain rich gas deposits, have been under Indonesian jurisdiction, the mood in Jakarta was decidedly unhappy. Foreign Minister Ali Alatas was immediately despatched on a three-day visit to Beijing, announcing on his return that his Chinese counterpart "Qian Qichen stated clearly that the Natuna Islands belong to Indonesia and the Chinese government has never claimed the islands." 12 As with the law passed in 1992, there was no explanation of how the map came to exist in the first place.

The Korean Peninsula  

The revelations from 1991 to 1992 that the Democratic People's Republic of Korea (DPRK) either possessed or could imminently possess nuclear weapons could hardly have come as a surprise to China. The two countries had collaborated in nuclear research for decades, and a number of North Korea's nuclear scientists had studied in the PRC. When North Korea's intransigence with regard to International Atomic Energy Agency inspections of its reactors prompted calls for the United Nations to impose sanctions, the PRC announced its "principled stance" against participating in such sanctions. Because of China's direct proximity and multitude of connections to the DPRK, for example, there are no less than seven rail lines connecting the two, as well as other air and land routes there was a consensus that any sanctions imposed without the PRC's participation would be ineffective. China argued its principled stance against sanctions on grounds of state sovereignty, a position that its critics see as situational rather than normative: The PRC feels that it must consistently defend sovereign rights, regardless of the gravity of the issue involved, lest it weaken its claim that China has the right to do whatever it wishes within its own borders. With regard to the contention that there are some issues, such as nuclear non-proliferation, so important that they transcend the importance of sovereign rights and that, as a permanent member of the United Nations Security Council, the PRC has a higher duty to the collective security, one analyst summarizes China's view as:

...The Security Council is an important arena  for demonstrating its status as a global power and pursuing its maxi/mini realpolitik, but not a world-order actor  in the promotion of collective security. There is, deep down in Chinese world-order thinking, little concern or commitment to revitalizing the United Nations Security Council as the principal instrument for abating, or even managing, world conflict. 13

China, of course, has interests in the Korean peninsula other than the protection of its views on sovereignty. North Korea's economy was close to collapse after a decade-long decline, and many analysts felt that the North was using its nuclear capabilities in order to gain assistance and diplomatic recognition from certain countries, including the United States, which had continued to withhold it. China cannot truly desire a nuclearized North Korea. On the one hand, PRC officials have hinted to foreign counterparts that they are concerned with the instability of the DPRK's leadership. Moreover, North Korea's accession to the nuclear club would deprive China of the cachet of being the only East Asian state to possess nuclear weapons, and could set off a dangerous round of proliferation. It could also rekindle Japanese interest in constructing a missile defense shield that would degrade the deterrent effect of the PRC's nuclear capability. More worrisome still for the Chinese leadership, with its vivid memories of the Second World War, Japan might be moved to remilitarize.

On the other hand, neither would China welcome the collapse of the DPRK. The trade and business ties the PRC has built up with South Korea in recent years are important to China's economic development. But a Korea unified under the South could be difficult to deal with, and the demise of North Korea would further reduce the already dwindling number of socialist states. In short, China has played a delicate game on the Korean peninsula in such a way as to maximize its own best interests.

Other Issues  

China has a major interest in two other matters of regional controversy in which no issues of territorial jurisdiction are involved. First is the matter of nuclear testing. Although the PRC has stated its willingness to participate in the nuclear non-proliferation treaty (NPT), it conducted three weapons tests in 1994 and two more in 1995. The May 1995 test occurred only four days after 178 countries had agreed on an indefinite extension of the NPT and a week after Japanese prime minister Murayama's state visit to Beijing, during which he requested that China not conduct such tests.

Responding to numerous protests, PRC spokespersons said that, while China welcomed the NPT renewal, this renewal should be viewed as a step toward denuclearization rather than as an end in itself. There had been no change in China's principled stance on the eventual complete destruction of all nuclear weapons. Meanwhile, however, China would continue to conduct tests until the Comprehensive Test Ban Treaty (CTBT) is concluded. 14 Assuming that the CTBT is completed on schedule in 1996, there would be a minimum of three years before China is legally required to stop testing. Experts estimate that this would be sufficient time for six to nine more tests at the present pace, and one to two more warhead designs. 15 China has also continued to advocate that the CTBT make provision for peaceful nuclear explosions, although there is little support for this position elsewhere. Arms control experts argue that peaceful nuclear explosions are unsafe as well as uneconomical for the resource extraction purposes for which the PRC purports to want them. They also argue that the determination of whether a test is conducted for peaceful or military purposes is more difficult to determine than the Chinese have alleged.

Less than two weeks after it announced that it intended to continue its nuclear tests, China again raised regional anxieties by testing the East Wind 31, a solid-fuel ballistic missile fired from a mobile launcher. The East Wind 31 is capable of carrying a 700 kg (1,540 lb) nuclear warhead and has a range of 8000 km (4,960 miles), although the actual test missile had a 2000 km (1,240 mile) trajectory. It is believed to be much more accurate than previous Chinese intercontinental ballistic missiles. 16

China has been a mainstay of Burma's State Law and Order Council (SLORC) since that body became an international outcast by refusing to allow Aung San Suu Kyi to assume the leadership post she was elected to in 1988. The international notoriety that accrued to China after its brutal suppression of unarmed demonstrators in June 1989 prompted observers to see the China-Burma friendship as an alliance of outcasts. China has delivered arms at an estimated cost of $1.5 billion to the SLORC. These include tanks, armored personnel carriers, fighter planes, multiple rocket launchers and small arms. The sum total of these weapons will make it still harder for democratic forces to oppose the ruling junta. Chinese engineers have helped to construct three highways from the border of the PRC's Yunnan province into Burma which anti-government Burmese point out could be the springboard for a Chinese takeover of their country. China has also assisted in expanding and upgrading several naval bases. Also, PRC-manufactured radar installations at the Cocos Islands base enable Chinese intelligence personnel to monitor the area which has invited speculation that China was cooperating with SLORC as a means to obtain an outlet to the Bay of Bengal and the Andaman Sea. This would give the Chinese navy a presence in an area heretofore dominated by India.

The growth of a military relationship with Laos paralleled that with Burma. China and Laos signed a military cooperation agreement in November 1993; less than a year later, three signals intelligence stations had been installed in the Southern Laotian province of Champasak, bordering both Cambodia and Thailand. The installation's ability to monitor communications within a 120 km radius bespeaks concern with activities along the frontier. 17 In October 1995, the PRC, Laos and Burma announced a joint border agreement that was officially described as "strengthening the ties of relationship, cooperation and understanding" among the three countries. 18 That China should feel it necessary to enhance its capabilities in the area added to regional anxieties about the PRC's intentions there.

The Chinese Military  

Also contributing to regional fears of China has been the perception that the People's Liberation Army (PLA) is rapidly modernizing as well as becoming more assertive in support of the country's irredentist claims. Defense budgets have nearly tripled over the last seven years, from 21.53 billion yuan ($5.83 billion) in 1988 to 63.1 billion yuan ($7.48 billion) 19 in 1995. China has purchased Sukhoi-27 fighter planes and Kilo-class submarines from Russia and has been negotiating a co-production agreement to manufacture Su-27s in the PRC to develop the country's indigenous production capability. The PLA also has three million active duty members, making it the largest military in the world. Since China is also by far the largest country in the world, it can call up more recruits than any other country should the need arise. Moreover, it is feared the PLA leadership is becoming more assertive in support of irredentist causes. On several occasions, civilian leaders have reportedly received letters signed by groups of high-ranking military figures demanding a stronger stand on such issues as assertions of independence emanating from Taiwan, moves toward democratically-elected governments in Hong Kong and perceived bullying by the United States.

The PRC has been at pains to counter the image of an emerging military juggernaut. As explained by State Council Minister Hu Ping, most of what looks like a rapidly escalating budget can be accounted for by an inflation rate which is also high. Part of the rest was used to offset debts the PLA had accumulated because of unduly low military expenditures in the past. 20 Military spending is in fact declining in proportion to China's total gross national product (GNP), accounting for 1.7 percent of GNP in 1991; 1.5 percent in 1992; and 1.3 percent in 1993. The PRC's per capita military spending was equivalent to $5 in 1994, compared with $1,000 for the United States, $360 for Japan and $8 for India. The PLA was poorly equipped, and in any case China wished to concentrate on domestic construction and development. Hu stated emphatically that the PRC sought neither expansion nor hegemony. 21

Hu makes several valid points, although some clarification is in order. While the published defense budget has indeed barely kept up with inflation, it is also the case that the published defense budget is believed to represent approximately one-third to one-fourth of China's actual defense expenditures. 22 Its neighbors' calls for more transparency on defense spending have been ignored. Moreover, unlike Japan, Taiwan and South Korea, China has never published a defense White Paper. 23

Hu's contention that the PLA is poorly equipped is correct. So far, the PRC has purchased just 26 Su-27s. These are hardly sufficient to give China a margin of victory in time of war, even if the PLA's woeful record on aircraft maintenance could be improved to the level that all 26 planes were combat-ready. In-flight refuelling is more of a theoretical than an actual capability and the navy and ground forces have similar deficiencies in equipment and training. 24 In the summation of a Western military officer, the Chinese military's power "dissipates exponentially as the distance from the homeland increases." 25 While this is true, many of its potential Asian adversaries -- for example, the Philippines -- are even weaker. And China's inventory of weapons, despite being outmoded, is several times as large as those of potential adversaries. Even technologically sophisticated militaries can be overwhelmed by sheer force of numbers. A nightmare scenario for roc planners is an attack on Taiwan by thousands of fishing junks. The Taiwan military's own simulations show the roc's Indigenous Defense Fighters and F-16s succumbing in a war of attrition with large numbers of less capable mainland F-7s flown by less well-trained pilots. 26

Western intelligence analysts are uniformly skeptical of letters allegedly sent to China's civilian leadership by groups of generals urging a harder line on international issues. All of these letters, they note, have appeared only in the Hong Kong press and very few can be confirmed on the basis of other sources. However, they add, there are other, more effective, private channels through which military leaders can make their views known. With regard to statements by Hu and others that China wishes to concentrate on domestic development, these will not reassure countries who find that all (in the case of Taiwan) or part (Spratly Islands claimants) of the territory they believe is theirs is believed by the PRC to be part of its domestic jurisdiction. Nevertheless, the PLA's poor power projection capabilities and China's many internal problems 27 place very real constraints on its ability to assert itself regionally.

Regional Responses  

Asian states have a variety of options, both singly and collectively, in response to the PRC's apparent attempt to move into a hegemonic position in the region. The path of least resistance, that of accommodation to China's wishes, seems to be unacceptable to most states therein. Another proposed remedy, that of using the United States to counter the PRC, is unfeasible. 28 America has refused to take a position on the ownership of the disputed Spratly Islands. Although the United States is congressionally mandated through the Taiwan Relations Act of 1979 to maintain a balance of power in the Taiwan Strait, American intervention in a Chinese attack on Taiwan cannot necessarily be assumed. The official U.S. position has been to express its desire that both sides come to an agreement on the sovereignty of Taiwan through peaceful means. Despite pressure from both sides of the Taiwan Strait however, the United States has not said what it would do if the process turned belligerent. Several countries have expressed the need for a continued American military presence in the area. 29 American statements on its intentions to remain actively engaged in Asia 30 should not be allowed to obscure the fact that the United States may not be as active as some states would prefer.

Individual state responses have ranged from the legal to the militaristic. Several claimants to the Spratlys amassed historical and legal documents to bolster their respective cases for sovereignty. Vietnam, its lack of diplomatic relations with the United States at the time notwithstanding, hired the prestigious Washington law firm Covington & Burling to assess how the International Court of Justice would settle boundaries in the Blue Dragon and Vanguard Bank areas whose ownership it contests with China. 31

Japan seeks to constrain the PRC from behavior it considers unacceptable through using China's awareness of the importance of Japanese capital, technology and managerial expertise to its continued economic development. Only rarely are these pressures publicly seen. In one recent instance, the Murayama government announced that it was suspending its 1995 grant aid to the PRC in light of China's continued nuclear testing. China responded publicly, calling the Japanese move "unwise", "totally unreasonable" and "harmful to Sino-Japanese relations." 32 Tokyo replied that it would not resume the aid until Beijing agreed to end its testing. 33 At the same time, the Japanese government announced that it would loan approximately $50 million to Burma; a desire to reduce the slorc's dependence on China was one of several motives behind the generosity. 34

Malaysian foreign minister Badawi observed pointedly that if the conflicting Spratlys claims were not brought under control, they would have a negative effect on the area's security and that, despite China's reluctance to refer the dispute to a third party, it would be necessary to do so to avoid tension in the region. 35 An editorial in the Bangkok Post  noted that Beijing's decision to resort to harsh rhetoric rather than explanations for its missile tests off Taiwan and escalating arms exports was worrisome. 36 And an Indonesian newspaper covering the "Defense Asia 95" arms exhibition attributed the interest in arms purchases to Southeast Asian states' concerns with the PRC's growing military assertiveness, even as the United States was withdrawing from the region. 37 While some of these purchases might be construed as aimed at generalized domestic security for example, coastal patrol boats as a deterrent to smugglers and pirates there could be little doubt that fear of China was the major reason for the escalation in arms acquisitions.

In the Philippines, there was a marked change in the hitherto prevailing view that China was both far away and benign. President Ramos, a West Point graduate and former military commander, quickly drew up plans that would enable the country to police its 7,100 islands and to deter intrusions into its exclusive economic zone. The generally frugal Filipino Senate approved with minimal debate a bill that would dramatically increase military spending. Appropriately, the main recipient of these funds will be the navy. Forty percent of the funds are earmarked for combatant vessels, including missile-equipped frigates and corvettes. Ship-borne rotary wing aircraft and anti-submarine warfare capabilities are also to be increased. More army bases as well as naval and air stations will be established, and the air force is authorized to purchase sophisticated fighter planes such as the F-16 or Mirage 2000. 38 Other countries increased their arms acquisitions as well. Malaysia has purchased Hawk aircraft from Britain, MiG-29 fighters from Russia and F/A-18D multi-role aircraft from the United States. Its navy has ordered frigates from Britain. 39 Singapore has improved its air defenses by adding an additional battalion equipped with Mistral surface-to-air missiles purchased from France; it has also bought F-16 fighter planes from the United States and is taking part in a submarine-training program offered by Sweden. Mine countermeasures and anti-submarine capabilities are also being strengthened. 40 Thailand has made major purchases of tanks and planes from the United States and continues to debate the wisdom of acquiring submarines versus minesweepers. 41

Taiwan, due to its proximity to the Chinese mainland, is perhaps most concerned with the need to build up its defenses. The roc was already the world's eleventh largest arms purchaser in 1994, 42 when tensions in the Taiwan Strait were much lower. Now, the military plans a 20 percent increase in spending for fiscal year 1996. 43 Despite its huge cash reserves, the roc has found it difficult to acquire all that it feels it needs, since many countries are unwilling to incur the wrath of China by selling arms to the island. But, the United States and France have been less easily intimidated than other countries. Taiwan has acquired four E-2T planes as part of its "Strong Net" program to upgrade airborne reconnaissance and combat capabilities; these are said to have extended Taiwan's early warning time from 5 to 25 minutes. 44 In addition, it has expressed interest in purchasing U-2 spy planes. 45 The air force has also acquired Mirage 2000-5 and F-16 fighter planes from France and the United States, respectively. Taiwan also produces its own Indigenous Defense Fighter. Naval upgrades include locally manufactured guided missile frigates based on the U.S. Perry-class, Knox-class frigates leased from the United States and Lafayette-class frigates purchased from France. Taiwan has in addition contracted for Patriot air defense systems, 46 Mistral surface-to-air missiles 47 and Milan anti-tank missiles. 48 Opposition from China, however, has for the past decade prevented it from acquiring submarines.

Even Japan signalled that it was concerned that its economic power would not be enough to constrain China from actions that Tokyo considered hostile. A Defense White Paper published in mid-1995 contains a substantial section on China's military buildup as well as that of North Korea. Japanese commentators interpreted the White Paper as calling for the continued modernization of the Self Defense Forces. 49 In September, the Defense Agency, noting that China had deployed Su-27s, announced plans to reinforce the country's air alert system and to replace its F-4EF fighters in Okinawa with F-15s "so that Japan can respond to neighboring countries' modernization of their military forces and possible outbreaks of regional conflicts." 50 Also, the first of a planned 141 FSX fighters, the most expensive fighter-bomber in the world, successfully completed its initial test flight in October. 51 A week later, Tokyo announced that Japan and the United States had been discussing joint research on theater missile defense. 52

There were also bilateral responses to China's perceived expansionism. Several countries, such as Singapore and Malaysia, have conducted joint exercises for many years, and these continued along established patterns. Malaysia also sought out new partners, setting up a joint defense industry cooperation committee with South Korea, 53 and indicating that it was interested in ties with the South African military. 54 Moreover, India and Indonesia initiated joint naval exercises.

Both external analysts and concerned parties in the states who are apprehensive about China's intentions agree that multilateral responses would be far preferable to a situation in which individual countries fear that the PRC intends to pick them off one by one. 55 There is, however, no obvious way to engage China collectively. Asia, with its wide range of different cultures, religions, and threat perceptions, has historically been weak in such institutions. ASEAN has eschewed a military role. Moreover, it works by consensus rather than majority vote. On the matter of the Spratlys, three of its members, Indonesia, Singapore and Thailand, are nonclaimant states. The organization was nonetheless happy to welcome Vietnam into membership in July 1995. Several member states also expressed approval when the United States and Vietnam established diplomatic relations at the same time, hypothesizing that the combination of these two events would counterbalance Chinese assertiveness. 56

The Asia-Pacific Economic Cooperation Organization has, like ASEAN, avoided discussions on security issues. The Asian Regional Forum (ARF) was established in July 1994 to provide a high-level consultative framework. Although China is a member, it insists that it will consult only bilaterally on security issues. In light of the fact that China's claims in such areas as the Spratly Islands are quite strong, 57 some scholars seem puzzled by the PRC's reluctance to discuss the issue in multilateral fora. An analyst of nuclear arms negotiations provides the probable answer:

...what China's bargaining behavior shows is that it is reluctant to engage in formal multilateral arms control processes precisely because it knows these are likely to be the most effective in constraining its military capabilities. This is because the image costs from backing out of these kinds of processes are extremely high. 58

The principle holds for China's attitude toward other regional issues as well. If the image costs of no obvious way to engage withdrawing from a collective bargaining process will be high, then it is best to avoid allowing oneself to become engaged collectively. Not surprisingly, therefore, the first two meetings of ARF have been inconclusive, long on pious pronouncements and short on results. The organization has created no conflict resolution mechanisms and seems hesitant to address the issue of doing so. While it is difficult to disagree with pompous cliches on the need to draw the PRC into a constructive dialogue, it should also be pointed out that all that has taken place so far has been dialogue, and that not all dialogues will be constructive. The United States and Japan for example, were exchanging views somewhat amicable until the day of the attack on Pearl Harbor. Nor does that other hoary anodyne, that economic growth will lead to an abatement in security concerns, necessarily follow. As has been pointed out, economic and security issues frequently unfold at different times and at different speeds. While economic trends are often self-correcting, security trends are generally not. Moreover, economic boycotts decided upon by collective security organizations typically hurt the producer who complies far more than the consumer who is the target. And, while national leaders are frequently able to determine their
respective countries' strategic direction, they have much less control over their states' economic affairs. 59 Economic growth may sharpen rather than blunt security rivalries and may also facilitate the growth of defense budgets.


In Robert Gilpin's formulation, a state dissatisfied with the status quo will seek to change it through territorial, political, and economic expansion until the marginal costs of further change are equal to or greater than the marginal benefits. 60 China is such a state. Clearly, it is also in possession of most of the attributes that would allow it to play the role of regional hegemon. Thus far, states who feel threatened by China's territorial, political and economic expansion have been unwilling or unable to raise these marginal costs to anything approaching the level of marginal benefits to China. For example, if it is true that China does not wish to engage in collective negotiations because the image costs of backing out of these negotiations are high, then it would be in the best interests of states who perceive themselves to be threatened by Chinese hegemony to heighten the image costs to the PRC of its refusal  to participate in collective negotiations.

Should the benefits to China continue to outweigh the costs of expansion, the chief constraints on China's rise to hegemony will not be international but domestic: the PLA's limited power projection capabilities and the country's many internal problems. Until such time as the other states of Asia can reach a consensus on how to counter the PRC's assertiveness, there will be no significant cost to China of that assertiveness.

Note 1: See, e.g., Yoichi Funabashi, "The Asianization of Asia," Foreign Affairs, 72, no. 5 (November to December 1993) pp. 75-85. Back.

Note 2: Kishore Mahbubani, "The Pacific Impulse," Survival, 37, no. 1 (Spring 1995) p. 116. Back.

Note 3: The Qing were not Han Chinese but rather Manchus. Back.

Note 4: As stated by Government Information Office Director-General Jason Hu on Firing Line, 14 October 1995. Back.

Note 5: The mother tongue of Taiwanese is minnan, spoken in Fujian; min is the classical Chinese name for Fujian. Back.

Note 6: See "President Urges Cross-Strait Summit," Beijing Review (6-19 February 1995) p. 5. Back.

Note 7: In a poll taken by the KMT's Policy Research Committee in October 1995, only 10 percent of respondents approved of a cross-strait summit before the roc's presidential election. See Sofia Wu, "Taiwan People Favor Cross-Strait Summit, But Not Now," Central News Agency (cna, Taipei), 13 October 1995. Back.

Note 8: The text of this law may be found in Xinhua (Beijing), 25 February 1992, in United States Technical Information Service, Foreign Broadcast Information Service: Volume 1: China(FBIS-chi), 28 February 1992, pp. 2-3. Back.

Note 9: More than the imperial visit was at stake. Since Japanese right-wing political forces were particularly vociferous about the affront to their country's sovereignty, some Chinese leaders worried that the law would give ammunition to those who wished to remilitarize Japan. Back.

Note 10: See Ma Baolin, "Legislation Doesn't Mean Policy Change," Beijing Review (30 March to 5 April 1992) pp. 10-11. Back.

Note 11: Merlinda Manolo, "prc Warns, Offers Cooperation Pact in Spratlys," Manila Standard(Manila), 23 July 1995, p. 4. Back.

Note 12: Antara (Jakarta), 21 July 1995, in Foreign Broadcast Information Service: Volume IV: East Asia and the Pacific (FBIS-EAS), 24 July 1995, p.75. Back.

Note 13: Samuel S. Kim, "China and the Third World," in China and the World: Chinese Foreign Relations in the Post-Cold War Era, ed. Samuel S. Kim, 3rd edition, (Boulder CO: 1994) p. 143. Back.

Note 14: Xinhua (Beijing), 15 May 1995. Back.

Note 15: Alastair Iain Johnston, "Prospects for Chinese Nuclear Force Modernization: Limited Deterrence Versus Multilateral Arms Control," China Quarterly (forthcoming, June 1996). Back.

Note 16: Nigel Holloway, "A Chill Wind: Stealthier Nuclear Missile Raises U.S. Fears," Far Eastern Economic Review (Hong Kong), 15 June 1995, pp. 15-16. Back.

Note 17: Robert Karniol, "China Sets Up Border SIGNIT Bases in Laos," Jane's Defense Weekly(19 November 1994) p. 5. Back.

Note 18: KPL (expansion unknown; Vientiane), 12 October 1995, translated in FBIS-EAS, 13 October 1995, p. 58. Back.

Note 19: The apparent discrepancy in the conversion factor between yuan and dollars reflects several currency devaluations which occurred in the interim period. Back.

Note 20: There was a sharp, one-time increment in the PLA's budget in 1979 to cover the costs of the war with Vietnam, followed by nearly a decade of very modest budgets which in several years did not even keep up with the inflation rate. There were complaints of poor barracks maintenance, poor food and poor morale, as well as rising corruption that was driven by the need to deal with budgetary shortfalls. Back.

Note 21: Hu Ping, "China Constitutes No Military Threat," Beijing Review (21-27 November 1994) p. 22. A large number of other Chinese sources make similar points. Back.

Note 22: International Institute for Strategic Studies, The Military Balance 1995-1996(London: Brassey's 1995) pp. 270-275, details the ways in which Chinese statistics underestimate the actual defense budget. The compilers believe the real figure to be four times that of the official figures. Back.

Note 23: The PRC published its first White Paper shortly after this article was written. It does not, however, provide the transparency that external observers had hoped for. Back.

Note 24: See Dreyer, "The PLA's New Officer Corps: Implications For the Future," China Quarterly (June 1996) (forthcoming) for a more detailed discussion of these points. Back.

Note 25: Karl W. Eikenberry, "Does China Threaten Asia-Pacific Regional Stability?" Parameters(Spring 1995) pp. 90-91. Back.

Note 26: For a cogent summary of likely scenarios of a PRC-ROC confrontation, see Hsheh Erh-men, "Taiwan's Trans-century Crisis and Survival: a Great Debate on T-Day," Chien-tuan k'e-chi (Cutting Edge Technology; Taipei), 1 April 1995, pp. 102-111. Back.

Note 27: These include environmental degradation, uneven economic development, growing numbers of citizens who do not automatically comply with their leaders' orders and a succession crisis. See the articles by Dali Yang and Peter Ferdinand elsewhere in this issue. Back.

Note 28: A professor at the United States Naval Academy on a speaking tour of Southeast Asia found himself asked repeatedly, even by military officers whom he thought should know better, why the United States did not immediately bomb or shell the Chinese installations on Mischief Reef. Those who did not demand immediate violence asked why Washington did not send a message to Beijing announcing that such structures would not be tolerated and demanding that they be removed. See Stephen Wrage, "Mature Response to Chinese Moves Is Needed in Asia" Asian Wall Street Journal Weekly, 8 May 1995, p. 16. Back.

Note 29: See, e.g, "The United States Military Presence is Still Necessary in Southeast Asia," Kompas (Jakarta), 5 August 1995, p. 4, translated in FBIS-EAS, 9 August 1995, p. 60; "New Security Policy Sould Include U.S.," Bangkok Post, 2 October 1995, p. 4. Immediately after the Philippine senate asked the United States to vacate its military bases in that country, Singapore and Malaysia separately offered the use of facilities in their respective countries. Back.

Note 30: See, for example, Assistant Secretary of Defense for International Security Joseph Nye's "The Case for Deep Engagement," Foreign Affairs, 74, no. 4 (July to August 1995) pp. 90-102, which is more appropriate to a Fourth of July speech than to publication in a scholarly journal. Back.

Note 31: Covington & Burling's opinion was that Blue Dragon lies on Vietnam's continental shelf, and that Vanguard Bank, which the PRC has already leased to the Crestone Energy Corporation, is also in Vietnamese waters. See Barry Wain, "International Law Firm Hired By Hanoi Asserts Vietnam Is Entitled to Disputed Areas' Deposits," Asian Wall Street Journal Weekly, 19 June 1995, p. 5. Back.

Note 32: Gu Ping, "An Unwise Move," Renmin ribao (People's Daily; Beijing), 9 September 1995, p. Back.

Note 33: Kyodo (Tokyo), 13 October 1995. Back.

Note 34: Other motivations included, first, a desire to reward the slorc for having released Aung San Suu Kyi from house arrest and, second, the desire to counter loans already extended by its economic rival South Korea. See Sankei shimbun (Tokyo), 5 October 1995, p. 1, translated in FBIS-EAS, 17 October 1995, p. 15. Back.

Note 35: Utusan Malaysia (Kuala Lumpur), 15 July 1995, p. 33, translated in FBIS-EAS, 18 July 1995, p. 43. Back.

Note 36: "China Must Explain Its Outbursts To Neighbors," Bangkok Post(Bangkok), 27 July 1995, p. 4. Back.

Note 37: "Southeast Asia's Arms Market is the Focus of Attention at the 'Defense Asia 95' Arms Exhibition," Kompas (Jakarta), 19 September 1995, p. 4, translated in FBIS-EAS, 21 September 1995, pp. 55-56. Back.

Note 38: Kyodo (Tokyo), 13 August 1995, in FBIS-EAS, 14 August 1995, p. 79. Back.

Note 39: iiss, The Military Balance 1994-1995, 1994, p. 166. Back.

Note 40: Raoul Le Blond, "Navy To Buy Used Submarine From Sweden," The Sunday Times(Singapore), 24 September 1995, p. 3, in FBIS-EAS, 26 September 1995, pp. 60-61. Back.

Note 41: See, for example, "Defense Minister Views Purchase of U.S. Tanks," Bangkok Post, 22 September 1995, p. 1, for a brief discussion on how best to upgrade Thai defenses. Back.

Note 42: Benjamin Yeh, "Taiwan 11th Largest Arms Importer," CNA, 4 October 1995. 1996. Back.

Note 43: Benjamin Yeh, "Anti-Missile Research Underway, Chiang Says," CNA, 11 October 1995. Back.

Note 44: Lilian Wu, "Final 2 E-2T AWACS Arrive From U.S. 23 Sep," CNA, 25 September 1995. Back.

Note 45: Bill Wang and Sofia Wu, "Magazine Says Taiwan Interested in Buying U-2s," CNA, 19 September 1995. Back.

Note 46: Benjamin Yeh, "Anti-Missile Research Underway, Chiang Says," CNA, 11 October 1995. Back.

Note 47: Sofia Wu, "roc Army Brass Leaves For France For Mistral Deal," CNA, 13 October 1995. Back.

Note 48: "Taiwan Planning To Purchase Milan Missile," Chung-shih wan-pao(Taipei), 3 October 1995, in FBIS-CHI, 12 October 1995, p. 46. Back.

Note 49: "Editorial Critiques 1995 Defense White Paper," Tokyo shimbun (Tokyo), 3 July 1995, p. 5, translated in FBIS-EAS, 12 July 1995, pp. 29-30. Back.

Note 50: "DA To Reinforce Air Raid Alert System," Nihon keizai shimbun (Tokyo), 20 September 1995, p. 2 translated in FBIS-EAS, 21 September 1995, p. 6. Back.

Note 51: Kyodo, 7 October 1995. Back.

Note 52: "Tokyo, U.S. Study Missile Technology Research," Nihon keizai shimbun, 13 October 1995, p. 1, translated in FBIS-EAS, 17 October 1995, pp. 10-11. Back.

Note 53: "Defense Industry Panel With Malaysia Forming," The Korea Herald (Seoul), 8 July 1995, p. 3, in FBIS-EAS, 11 July 1995, p. 54. Back.

Note 54: TV 1 Network (Johannesburg), 9 August 1995, in FBIS-EAS, 9 August 1995, p. 56. Back.

Note 55: See, e.g., Barry Wain, "China's Nibbling Stokes Security Concerns," Asian Wall Street Journal Weekly, 20 March 1995, p. 14. Back.

Note 56: See, e.g., Ellen Tordesillas, "Balancing Power in Asia," Malaya (Quezon City), 1 July 1995, p.6, in FBIS-EAS, 18 July 1995, p. 48. Back.

Note 57: See, e.g., Greg Austin, "China's Ocean Limits Time To Settle," paper presented to the United States Institute of Peace, 4 September 1995. Back.

Note 58: Johnston, China Quarterly (forthcoming, June 1996). Back.

Note 59: So argues Peter Ackerman in, " 'The Economic Aspects of Pacific Security': A Reply," in Asia's International Role in the Post-Cold War Era: Part I, Adelphi Paper 275, IISS (March 1993) pp. 31-32. Back.

Note 60: Robert Gilpin, War and Change in World Politics (Cambridge: Cambridge University Press, 1981) p. 106. Back.