Restless Empire

by Odd Westad

  Leaders in Beijing used the break from the attention of an aggressive and nationalistic new US administration to further build their economy and their military power. While the United States pursued its wars in Afghanistan and Iraq, China’s GDP almost tripled. In 2010 it became the world’s second largest economy, after the United States, but ahead of all others, including Japan and Germany. It is the largest exporter and the second largest importer of goods in the world, and will soon become the largest trading partner of the United States and the European Union. It is already the main trading partner of many leading countries, from Japan and Australia to India and Brazil. As could be expected, China’s trade surplus is massive, and Chinese investment is starting to flow outwards. During the 2008–2009 economic crisis, Chinese companies bought car manufacturers (Sweden’s Volvo and Britain’s Rover, for instance), financial companies, and technology firms abroad. Chinese institutions are the largest buyers of US government securities, holding an estimated twenty percent of the total.26

  But not all is well with the Chinese economy. As we will see in the final chapter, China’s economic outlook is in no way certain, and the extensive links with the world economy bring risks as well as opportunities. Other countries, most importantly the United States, are complaining about Chinese currency manipulations and state interventions in the domestic economy, and want to see the Chinese trade surplus reduced. Inside China many people are concerned about rising inequality, atrocious labor conditions in some industries, and the need to create new jobs for the millions who enter the industrial job market every year. In terms of GDP per capita, China is still number 101 of all the countries in the world. Its $7,400 is right behind Albania, Ecuador, and Algeria. The US figure is $47,500.

  China’s military modernization started, as we have seen, from a very low level. When the reform period began in 1980, China had a large conscript army of 4.5 million men and little combat effectiveness, as its war against Vietnam had shown. The PLA’s technological level was atrocious compared to armies elsewhere; its mechanized divisions were in disarray; its air defenses were mostly unserviceable; its air force and navy near nonexistent for purposes of modern warfare. It has taken China a generation to catch up, and its military capabilities today are still far behind those of the United States or even Japan. It does, however, now for the first time since the fifteenth century have a blue-water navy, with fifty submarines (ten nuclear) and seventy major warships. In 2011 the Chinese air force tested a new stealth fighter, similar to the American F-117. While the PLA is extraordinarily proud of this achievement, it must jar a bit that its testing came two years after the US air force began retiring their F-117s, first tested in 1981. The chances for China to catch up with the United States in military terms for another generation are slim as long as the present pattern in military investment continues. US defense spending was at least one trillion dollars in 2010. The Chinese was one-tenth that, from a much lower starting point in terms of training or military hardware. China’s military power today is therefore much more comparable with that of Japan or Britain than that of the United States.27 What will happen to China’s emphasis on its military development will primarily be shaped by events in its own region, East Asia, which we will look at in the next chapter. But there is no doubt that China’s complicated relationship with the United States in the past will cast its shadow over all Chinese thinking about national security in the future.

  THROUGHOUT THE LATE twentieth century, China viewed the United States eagerly. It did so simply because America was the dominant force on most matters from medicine to music to military power. Many foreigners who visit China for the first time are astonished by the significance young Chinese give to the United States, for good or bad, and by the contradictory view of the world that this imagining of US positions creates: US global predominance is certainly visible all over the world, but people in Berlin or Buenos Aires pay less attention to it than do people in Beijing. Maybe this is because some Chinese think that the United States is occupying a global position that rightly belongs to China. Or is it because so many young Chinese want to become more like Americans as they see them—modern, independent, goal-driven, and wealthy, with a fair amount of ruthlessness (soap opera style) thrown in for good measure? Whatever the reason for China’s current US obsession, it is influenced and shaped by the history the two countries share, not only in diplomatic and military terms, but in terms of how people think and behave. It is probable that in the future China will become more similar to what the United States looks like now. But political relations and the two people’s perceptions of each other will likely be strained.

  CHAPTER 11

  CHINA’S ASIA

  THE MOST REMARKABLE ASPECT of China’s international development over the past thirty years has been its reengagement with the rest of Asia. Until three decades ago China suffered a self-imposed exile from the continent of which it is a part. Its only close relationship was with North Korea, and even in Pyongyang, the dirt-poor capital of the northern Korean state, Beijing had to compete for position with Moscow. As if the diplomatic isolation were not enough, China had territorial issues with all of its neighbors, including North Korea. Along the northern border, Chinese and Soviet troops were facing each other along 3,000 miles of closed frontiers. In the south, China had just fought a war with Vietnam, in which it lost at least 20,000 soldiers, and the other Southeast Asian states understandably viewed China with suspicion. India, along China’s southwestern frontier, was politically close to the Soviet Union and, since the 1962 war regarded China as a diehard enemy. It was an Asian world that seemed to have expurgated China from its midst. The central kingdom was no longer central, but distinctly peripheral to the rest of the continent.

  The main cause of China’s marginality was its own contrary politics, but another key reason was economic. While other Asian economies were making strong gains, China’s stagnated. Japan had of course been the pioneer of development in the region, with substantial growth rates even in the early twentieth century. But from 1950 to 1973, the Japanese economy grew by an average of ten percent a year, as did Taiwan’s. Singapore, South Korea, and Hong Kong grew by eight percent annually. In the PRC, GDP per capita in 1973 was around $800. In Japan it was $11,500, in Hong Kong $7,000, in Singapore $6,000, and in Taiwan $4,000. China was falling further and further behind the leading economies in Asia, and even though most Asians would have liked to see China open up to their exports, they did not actually believe that it was going to happen anytime soon.1

  Then look at the situation today. China’s own economic growth since 1980 has been spectacular, averaging near ten percent a year, and it has rejoined an integrated East Asian system of trade, finance, and investment. What is more, this growth has taken place in a country of 1.3 billion people, more than double the population of the rest of East and Southeast Asia put together. The journey that China has been on over the past generation has been intimately linked with its relationship to its neighbors, first those next door and then into the southern and western parts of the continent. Indeed, China’s rise would have been impossible without it revitalizing these links. China is now an economic powerhouse that all of the rest of Asia orients itself toward, and its policies on all matters are of crucial importance for the whole region.

  In order to understand China’s interplay with its neighbors today we need to look at its immediate history. More has changed over the past thirty years than during any other generation in this region’s development, and it is an ongoing process. In 1991 the Soviet Union suddenly collapsed. New Russia in the north and the other post-Soviet states bordering China in the west are no security threats, except as far as terrorism is concerned. In the south, instead of being a Soviet ally, Vietnam is now a part of an increasingly integrated community of states in Southeast Asia, ASEAN (Association of Southeast Asian Nations). In the east, Japan has become more independent in its foreign policy, although it is still a close US ally. As far as Korea goes, China
is now South Korea’s most important export market, and Koreans invest more in China than they do anywhere else. The whole region’s relationship with China has changed profoundly, but so has the relationship the other countries have with each other. As Eastern Asia has become the center of world economic development, the region itself—and China’s place in it—has been in constant flux.

  THE MOST STRIKING CHANGE in China’s foreign relations has taken place in the south. China’s most recent border war was with Vietnam, a country Maoist China had supported in its struggles for reunification against France and the United States. The 1979 war left deep scars in China. To most Chinese, its course demonstrated Vietnamese ingratitude, Soviet perfidy, and Chinese military weakness all in one. I visited the border areas not long after the war ended, and the shock was palatable. It was no secret to local people that China had lost the war, or at least not won it. In Beijing Deng Xiaoping must have thought about the wars in Vietnam two hundred years earlier, and how the Qianlong emperor’s inability to win had eroded his legacy. He may also have given some thought to the Americans’ unhappy experience of fighting the Vietnamese. Deng’s response, as we have seen, was to end the war, sideline the military politically, while streamlining and improving the country’s fighting capacity, which, it was hoped, would prevent similar disasters from occurring in the future.

  It was Chinese diplomatic ineptitude that brought about the brief but disastrous Sino-Vietnamese war of 1979. Throughout the late 1960s and 1970s, the Maoists had supported the radical Cambodian faction, the Khmer Rouge, especially after it took power in 1975 and introduced a Maoist-type state. When the Khmer Rouge leader Pol Pot repeatedly attacked Vietnamese territory, Beijing stuck by him because of its concerns over Hanoi’s increasingly close relationship with the Soviets. Throughout the 1980s China and Vietnam carried out a war by proxy in Cambodia, with Vietnamese troops keeping a new government in place in Phnom Pen. China supported the Khmer Rouge, the former regime whose claim to lasting infamy is that it carried the only known genocide against its own population. Although China was not the only country that supported directly or indirectly the Khmer Rouge remnants fighting from the jungles of western Cambodia after the Vietnamese forces had thrown them out of the capital in 1979, it was the only one that kept a close political relationship with Pol Pot’s group. Kaing Khek Eav, or Duch, who went on trial in 2009 for torturing and murdering 14,000 people in Tuol Sleng prison during Khmer Rouge rule, spent a year in China in the mid-1980s. Pol Pot himself spent two years there, ostensibly for medical treatment. China supplied considerable amounts of weapons and funds to the Khmer Rouge both before and after 1979. Vietnam withdrew from Cambodia in 1989, as the Cold War was coming to a close, but the terror of the Khmer Rouge continued up to the movement’s self-destruction in 1997, when Pol Pot killed his second-in-command and then either died or was killed himself. In the meantime, Cambodia could begin its slow journey back from the nightmare it had experienced.

  The end of the Cold War had a deep impact on the Sino-Vietnamese relationship. With the Soviet collapse and with the war in Cambodia won by the Vietnamese (although at a terrible cost), both Hanoi and Beijing were eager to find a modus vivendi. As China’s economy expanded, the Vietnamese Communist leaders became convinced that Vietnam had to reform its own economic sector. By the early 2000s, much inspired by the Chinese example, Hanoi had transformed its sluggish planned economy into a market-led expansion that in relative terms in Asia was second only to that of its northern neighbor. But the worries the Vietnamese leaders had over what they saw as Chinese attempts at controlling their country did not abate, and they were wary of Chinese investment, including that by returning Sino-Vietnamese who had fled during the war. Even so, China has become Vietnam’s largest trading partner, and all forms of economic exchanges are increasing rapidly.

  Despite good economic links and decent overall bilateral relations, some of the Sino-Vietnamese tension that we have seen through history continues today. Hanoi is particularly concerned over China’s territorial claims in the South China Sea. As we shall see later, this is a conflict that is threatening to overshadow much of China’s relations with its neighbors to the south. But for Vietnam, having fought a recent war with China, these claims have a direct security relevance as well as economic implications. If Vietnam accepted the Chinese position, even in part, then almost all of its coast would be alongside waters controlled by the Chinese navy. It would also, many in Hanoi believe, be left out of the exploration of rich natural resources under the seabed and rich fisheries in the sea above. Having joined ASEAN in 1995 and dramatically improved its relations with the United States, Australia, and Japan, Vietnam is trying to multilateralize the issue, in order to balance China’s growing power. China, on its side, is worried that Vietnam is spurning its offers of friendship and cooperation and that the country might become a cornerstone in a US-led containment policy toward China.

  China has come a long way in normalizing its relations with what is probably, in the long term, its most important neighbor in the region. But issues from history stand in the way of a full partnership. Still led by two Communist parties, the two countries go through frequent spats over historical issues. Both set of leaders insist that the other should censor nationalist sentiments on Internet sites or blogs. At the heart of the matter is the view, never completely forgotten or lost in Beijing or Hanoi, that China is the central state in the region, and therefore expecting, or demanding, subservience by others. The Sino-Vietnamese agreement on the exact land borders between the two countries, signed in 1999, took ten years to implement, amid accusations that both sides were moving century-old border markers in the dead of the night to gain advantage.2 It will not be easy for the two to achieve a balanced relationship.

  THE MOST COMPLICATED of China’s relationships in the region is with Korea. Even more than Vietnam, Korea was linked to the Qing-centered system of states in eastern Asia up to the late nineteenth century, and Chinese culture and political ideals have had a lasting impact on the country. Since 1947, Korea has been divided in two separate and inimical states as a result of the Cold War and the ideological dissensions among Koreans. Communist China fought its bloodiest war to save the Communist North Korean state, the Democratic People’s Republic of Korea, from its southern enemies and their American allies in the early 1950s. To many Chinese it is still a point of pride that China fought the most powerful country on earth to a standstill in that war. What China got in return, though, was an unreliable North Korean ally, led by the dictatorial Kim Il-sung and his offspring, over which it for a long time had to compete with the Soviet Union for influence. When the Soviet state collapsed in the early 1990s, the DPRK’s economy went into freefall, creating a man-made hunger disaster during which at least a million people died. Only Chinese aid kept it from being much worse. Today leaders in Beijing privately call the DPRK an albatross around China’s neck rather than a strategic asset. But, like Coleridge’s bird, it has proven exceptionally hard to get rid of without unleashing a curse that will send the region toward conflict and potentially war.

  Meanwhile, the Republic of Korea, South Korea, has transformed itself into one of the world’s leading economies and one of the region’s most advanced industrial states. China was slow to recognize South Korea’s increasing importance in its own right—partly for ideological reasons and partly because the CCP viewed it as being under US control. Even after reform began in China it took fifteen years for Beijing to recognize the government in Seoul and begin to deal with it directly. After mutual recognition in 1992, the relationship developed very slowly at first, because of intense resistance from China’s ally North Korea and Beijing’s worries about Seoul’s close alliance with Washington. But by the late 1990s both economic exchange and political contacts flourished, especially when South Korean president Kim Dae-jung and his successor, Roh Moo-hyun, tried to carry out a policy of détente toward the North between 1998 and 2007. Not only is China South Korea’s most i
mportant trading partner, but more than half a million South Koreans live in the PRC, more people than from any other country. This South Korean presence is a result of significant Korean investment in China’s industrialization process. Koreans feel a cultural and historical closeness with China. In opinion polls in South Korea in 2005, China was ranked equally with the United States—South Korea’s long-term ally—as a country South Koreans viewed favorably. Among those under forty, China had a clear lead in terms of being seen as friendly.3

  Over the past twenty years, China’s big headache in its relationship with Korea has been North Korea. Financially insolvent, internally oppressive, and aggressive toward its neighbors, North Korea symbolizes those flaws with which China does not want to be associated as it attempts to expand its regional reach. Ruled until December 2011 by the dictator Kim Jong-il, who inherited the position from his father in 1994, the secretive North Korean regime has, over China’s protests, developed nuclear weapons and is threatening to use them if its leaders feel under pressure. So why, may one ask, does China not simply disassociate itself from the Kim regime, now led by Kim Jong-il’s son Kim Jong-un, and build on its good relations with the prosperous South? The answer is complicated, but may be worth dwelling on if one is to understand China’s biggest foreign relations dilemma.