- The Washington Times - Sunday, February 6, 2005

China’s growing economic prowess was a focus of the Group of Seven meeting over the weekend. For the time being, that economic ascendancy is seen as the nature and extent of the Chinese threat.

In coming years, however, China’s economic power could translate into military might that could afford Beijing the wherewithal to try to counter U.S. influence in Asia and beyond. Just how economically and militarily powerful China becomes and how it will choose to project that strength remains to be seen. China’s longer-term economic progress still depends on Beijing’s ability to handle banks’ bad-debt portfolios, move towards a free-floating currency and dismantle inefficient state-owned companies.

America’s ability to contain China could depend on the rise of other global counterweights allied with the United States, particularly in Asia. Japan has a relationship with China that is as complicated as U.S.-Sino ties. Tokyo is clearly jockeying, though, to deal with a rising China.

Japan is pushing to finish a trade deal with Thailand and Malaysia to counter China’s growing trade ties with other Asian countries. Tokyo is also angling to negotiate a trade deal with the 10-member Association of South East Asian Nations, with talks scheduled to begin in a couple of months. Japan’s increasing military build-up also appears to be squarely focused on China. Although Japan in and of itself is not expected to have the economic power to act as a counterweight to the Chinese behemoth, it could be an important member of a loose alliance of countries keeping a wary eye on Beijing. Also, if Tokyo feels increasingly cornered by Beijing, it could acquire its own nuclear arsenal in a matter of months — a prospect China will try to avoid. Beijing has responded to Tokyo’s apparent apprehensions by calling for a free-trade deal between the two countries.

It remains to be seen which other Asian countries will form part of a China-wary alliance. China has made sure that other Asian countries have economic interests in maintaining close ties. China has a trade deficit with other Asian countries and developing nations in general, in what is probably part of a government-managed trade policy geared towards maintaining Beijing’s geopolitical clout. Korea, Taiwan, the Philippines, Thailand and Indonesia have all seen their trade with China rise significantly.

India is another critical potential counterweight to China. Although China’s growth has outpaced that of India, the latter country will probably become a challenger to China in economic and geopolitical terms. The two countries have seen their bilateral trade boom, but they are also natural adversaries due to their proximity and competition for energy resources. An Indian challenge to China could serve U.S. interests well, so long as U.S.-Indian relations remain strong in the next couple of decades.

China appears to be effectively using trade and investment as a platform for global influence. In that area, Beijing is a tough negotiator, making commercial ties in some cases contingent on other nations’ public support of China regarding Taiwan. China’s actions highlight the need for America to maintain its global leadership on trade, particularly in the Western Hemisphere, and to maintain close, productive relationships with India, Japan and other Asian nations.

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