Royal Norwegian Ministry of Foreign Affairs - RSIS Asian Security Conference 2013

ROYAL NORWEGIAN MINISTRY OF FOREIGN AFFAIRS - RSIS ASIAN SECURITY CONFERENCE 2013 13-14 March 2013 Park Royal on Pickering Singapore

Royal Norwegian Ministry of foreign Affairs – RSIS Asian Security Conference 2013

A report of a conference organised by S. Rajaratnam School of International Studies (RSIS) And The Royal norwegian Ministry of Foreign Affairs 13­­–14 March 2013 Park Royal on Pickering Singapore

Contents Page

Introduction

3

ay One: Plenary Session D U.S.-China Relations: Power Contest in Asia Ba ck to the Future or Renewed Dynamics?

4

ay One: Plenary Session D U.S.-China Relations: Power Contest in Asia Afternoon Session: Reporting from the Breakout Session

9

ay Two: Plenary Session D Southeast Asia and India’s Role in Changing Strategic Landscape

16

lenary Wrap-up: Where Does All This Leave Us P Back to the Future or Renewed Dynamics?

19

2 Royal Norwegian Ministry of Foreign Affairs – RSIS asian Security Conference 2013

Introduction This conference, jointly organised by the Royal Norwegian Embassy in Singapore and the S. Rajaratnam School of International Studies (RSIS) at the Nanyang Technological University (NTU), was the first in a series of collaborative events under a Memorandum of Understanding signed between RSIS and the Royal Norwegian Ministry of Foreign Affairs in November 2012 to promote the exchange of knowledge on strategic and security issues in Asia between Norway and Singapore.

Joseph Liow On the Norwegian side, senior diplomats and officials attended from Norway and a number of Norwegian regional missions, as well as expert facilitators from Norwegian research institutions. The conference was opened in Norwegian by Director General Mona Juul and Ambassador Tormod C. Endresen. On the RSIS side, opening remarks were delivered in English by Associate Dean Professor Joseph Liow on behalf of Dean Barry Desker. In addition to RSIS expert speakers and facilitators, keynote speakers were specially invited from Beijing, Washington and London to present on the plenary theme of “U.S.China Relations: Power Contest in Asia?”.

3 Royal Norwegian Ministry of Foreign Affairs – RSIS asian Security Conference 2013

DAY ONE: PLENARY SESSION U.S.-China Relations: Power Contest in Asia Back to the Future or Renewed Dynamics?

Regional Security and U.S.-China Relations in Second Obama Administration: An Uncertain Forecast

different from the past and this process of transition may impede the interests of other powers in the region, small or large. This underscores the challenge of building a future-oriented regional order which on one hand accommodates both the U.S. and China, and on the other hand, does not undermine the interests of other countries in the region.

Turning to internal U.S. considerations, despite continuity in the executive there is almost a complete turnover of official leadership responsible for foreign policy in President Obama’s second term. This brings new dynamics to foreign policy of the U.S.. The U.S. “pivot” to Asia is an unhelpful label if interpreted as a signal that U.S. has shifted policy focus away from regions such as Middle East and Africa which are still very important to the U.S..

Jonathan D. Pollack Dr Pollack noted that the onset of President Obama’s second term coincides with ascension of a new leadership in Beijing and renewed pledges from both leaderships of the desire to build a regional order for the 21st century. Although many in China are satisfied about China’s accomplishments over the past several decades, unease and uncertainty remains concerning its larger international role and strategic intentions. There is still significant strategic distrust between the two powers.

Though China calls regularly for a non-adversarial major power relationship, this concept still lacks specificity.

Looking to the future, there is no clear template for U.S.China relations. This is unlikely to develop either as a replay U.S.-Soviet relations during the Cold War, or as a “G2”; nor will there be true multipolarity in Asia. While strategic uncertainty is going to shape the region in the long run, this does not necessarily mean the dynamic will be threatdriven. A “competitive” U.S.-China relationship is not bad per se; only adversarial relations are unhealthy. New leaderships across the region tend to focus on domestic agendas and national development, which suggests a predominantly economics-focused set of international relations in East Asia. However, the economic dimension may not be enough to carry us through. A raft of issues will have to be confronted.

The unspoken assumption is that there is enough room for both powers to share a set of interests in the Pacific.

Yet this tends to obscure the extent to which the capacity of both countries interact and interlock in ways that are

4 Royal Norwegian Ministry of Foreign Affairs – RSIS asian Security Conference 2013

China’s New Leadership and Prospects of Foreign Policy

If China’s strategic requirement prevails, U.S.-China rivalry would be mitigated and well-controlled. But, if domestic/ international restraints prevail, more tense bilateral relations can be expected. The primary challenge faced

by Chinese leadership in foreign policy towards the U.S. and regional countries is how to strike a balance between different strategic requirements, especially how to make national strategic requirements overcome the domestic and international restraints. The challenge is already sharp, yet the response remains under-prepared and far from integrated.

In the long-run, a peaceful “final settlement” can be achieved between the U.S. and China. This will require an understanding of the different balances of strength and influence in various functional and geographical areas and the adoption of the rationale of“selective preponderances”.

On one hand, that the U.S. not only accepts a leading position that China might obtain in terms of GDP, foreign trade volume, and economic/diplomatic influence in Asia, but also accepts the idea of mutual strategic deterrence, both nuclear and conventional, regulated by some arms control and confidence building agreements. On the other hand, the U.S., with China’s acceptance, would have predominance of diplomatic influence in some other regions comparative with that of China. The distribution of formal influence between these two powers in the global financial and security institutional arrangements would be roughly compatible with their respective material strength as well as their contributions in related functional areas, with the implication that China’s contribution has to increase commensurately with its increased strength.

Shi Yinhong Professor Shi’s presentation covered China’s foreign policy, the prospects for China’s new leadership and for U.S.-China relations. China’s new leaders, while inheriting a much strengthened national power base, face an international environment which is less benign and more complicated. There are inner tensions in China’s foreign policy marking and implementation, including the dilemmas presented by contending military/economic objectives and domestic imperatives versus international strategic requirements.

China’s prospects may be essentially unchanged, but somewhat clouded by volatility. In China, there is still no grand strategy to answer the basic questions of how to deal with: 1. d rastically increased national strength, drastically increased popular nationalism and other complex domestic forces;

However, there is another more ominous prospect which, and unfortunately, may be more likely based on present trends. The great power “structural rivalry” between China and the U.S. is becoming more widespread, profound, and pronounced.

2. t he U.S. and Asian neighbours, especially countries with which China has territorial and maritime disputes; and 3. how to contribute to global governance.

5 Royal Norwegian Ministry of Foreign Affairs – RSIS asian Security Conference 2013

How will the Evolving U.S.-China Dynamics affect the European Role in Asia?

European unity and problems with the lengthy consensus building process within the EU which has led China into bilateral discussions over security issues. China would also like to see a better understanding in Europe of China’s values and interests and greater respect for its “core interests.” More appreciation from Europe of the role China has played is also demanded by China. There are continued tensions between China and Europe over values and Beijing’s dislike of being lectured. China hopes for fewer European restrictions on technology and treatment of China as full partner.

The U.S. wants Europe’s support in institution building, more cooperation with Europe over Asia that is not simply mercantile and deeper partnership with Europe in Asia.

The U.S. wants Europe to support it over human rights.

The U.S. also hopes for a more constructive attitude over hard security issues such as arms embargo against China.

The U.S. wants to assure Europe that its pivot to Asia is not abandoning Europe, quite the contrary; it wants to work with Europe on Asian issues.

Rod Wye Both individual European countries and Europe as a whole face similar challenges, as far as U.S.-China relations are concerned. Europe needs to take Asia more seriously and it needs Asia to take Europe more seriously. Europe has become a “squeezed middle” between China and the U.S., which will be the dominating factors in the international relations. Europe has enormous stakes in the outcome of this relationship. Europe is living now in a rapidly changing security environment with China’s growing strength and assertiveness, and the U.S. “pivot” to Asia. The real problem is that as the U.S. is already an Asian power, China aspires to become one. How to balance this intellectually and geographically?

Europe wants stability in Asia and some voice in the discussions over the future of Asia and its institutions, to be treated as an actual strategic partner by both the U.S. and China. European countries do not want to be seen as a useful but often irrelevant pawn. To do that, Europe has to develop an effective strategic policy to manage the implications of China’s rise at both a global and regional level. Europe has a strong stake in the region it has strong economic relationship with both the U.S. and China.

Europe also wants to defend its core values.

In the short to medium term, Europe is facing a rather difficult period in a global order more defined by power politics and economic self-interest. Recent speculation that we are in the threshold of a new Cold War may be wide of the mark. Nonetheless, Europe and others may increasingly face issues on which they are expected to “take sides.” Europe does not even want to be asked the question, since both China and the U.S. are fundamental elements of international system and very important to European interests.

Ultimately, Europe needs to be more involved in Asia’s existing organisations. There is a strong need to find ways to bring the U.S. and China together, to cooperate.

Europe may need to cede some international power and influence to China, engage in closer and more effective dialogue with China both as a regional and a global player. Europe also needs to be prepared to confront difficult issues with the U.S. and China, while showing more respect and understanding of China’s positions.

Furthermore, European countries should support positive developments in China’s behaviour and seek positive involvement in institutions of Asia.

What do the various parties want from each other? In the case of China, there has been a profound sense of disappointment over Europe’s failure to develop as alternative power centre and over perceived change in European policy being led by more assertive politicians since 2005. China is also concerned about the lack of

6 Royal Norwegian Ministry of Foreign Affairs – RSIS asian Security Conference 2013

Question and Answer

No countries in the region would like to be confronted with a choice between the U.S. and China, but some do seek advantages in the political tensions between the U.S. and China. The Philippines is an excellent example, which sees U.S.-China tension in South China Sea as an opportunity. There really ought to be recognition that all states in the region have huge interests in maintaining stable and healthy U.S.-China relations.

Question: There are three “good news” factors within U.S.-China relations. First, it is easy to look at potential conflicts, but there is a widely accepted notion that China has a rightful claim for greater influence within global governance frameworks. Second, we realise that China has the aspiration to become “Number 1” economically, but not politically. Third, interdependence between the U.S. and China is also important. How could these factors contribute to better relations between the U.S. and China?

Question: There is a basic contradiction between the U.S. approach to China and China’s approach to the United States. China’s approach to the U.S. is a quest for respect and equality, which defines core Chinese interests. Under what conditions might China be ready to play down its emphasis on core interests, and become a global “stakeholder”; and under what conditions might the U.S. be willing to withdraw its presence from China’s immediate vicinity and accommodate China’s core interests?

Answer: From the U.S. perspective, the question is how to move to something of concrete and visible. The U.S. is uncertain about China’s strategic intentions. For now, China may accept prevailing arrangement, or norms. But China’s objectives might be different in the long term as its strength grows. If the central domain of competition is economic, we can be optimistic as long as there are reasonable rules underpinning the global economy.

Answer: China has recently shown greater willingness to participate and contribute to global governance.

Sometimes, we should be aware of the distance between language and actions. We should be clear about both sides’ real intentions. Both sides with good intensions have made some efforts, but relations have not significantly improved. Both countries have to rethink the basic questions.

Question: As new leaders focus on national agendas, how this will impact on foreign policies in the region and, how can countries in the region influence U.S.-China relations?

Answer: Across East Asia new leaders are driven more by perceptions of states interests almost as if there is no larger international system. Nationalism may not be a bad thing intrinsically, but it is driven by an intense internal focus, aiming to advance strategic advantages without considering neighbours. In the case of China-Japan tension, neither leaders in Tokyo nor Beijing seek military conflicts. Certainly the U.S. does not want to see a military conflict between China and Japan, but both countries are behaving without heed to the wider consequences of their actions. Unless China and Japan can establish mutually acceptable rules, something will happen, which might then trigger wider conflict. Ironically, although the level of interdependence, economically, culturally, socially and to some extent, intellectually, in East Asia, has never been higher, the tone of the political discussion is worrying.

The question whether or not the U.S. will withdraw from China’s vicinity? To be frank, it is about military capacity.

Regarding the argument of freedom of navigation, what the U.S. military seeks is the freedom to operate when it wants to, where it wants to and how it wants to operate without interference. But with China’s growing strength this is increasingly difficult for the U.S. to do.

The attitude within U.S. defence circles are still influenced

by Pearl Harbor and 9/11. The assumption is that unless you carefully watch every move, or action China makes, something may go wrong. The question is what will the transaction be if the U.S. withdraws? What can China offer to the U.S. in return? This is something deeply embodied in U.S. military thinking. The requirement for

7 Royal Norwegian Ministry of Foreign Affairs – RSIS asian Security Conference 2013

Question: Will Beijing push for political talks with Taiwan and will the U.S. increasingly see Taiwan as a liability?

the U.S. to monitor Chinese programmes or activities so closely is arguably overstated, but has nonetheless become established as a kind of military norm. On the other hand, if China were prepared to disclose more of its activities and capacities that would reduce the needs of the U.S. to continue to monitor China. The militaries in the two countries are configured in different ways. The PLA routinely considers close monitoring as one of the three major obstacles to advance U.S.-China military to military relations. It already has some aspects of Cold War. The military may be the prisoner of its past. There should be a much enhanced set of military to military communication and discussion between the U.S. and China.

Answer: Great progress has been made in cross-straits relations. For mainland China, the final objective is to unite Taiwan. Chinese leaders have never criticised President Ma Ying-jeou. But Chinese scholars and people are dissatisfied with Ma as he appears more willing to receive things from China than to give in return. China understands that although the current cross-straits situation is imperfect, it has greatly improved. What is more, the only assets that the PRC government has in Taiwan are the Kuomintang and Ma Ying-jeou Thus, China needs to be patient, hope for progress, but be realistic. China’s approach to Taiwan will not undergo major change. However, if Taiwan wants to begin political dialogue, China will encourage it.

Question: What about the “pivot” to Asia, and the risk of strategic drift?

Answer: Foreign policy is decided by the White House. It would be a big mistake to for the U.S. to conceive its Asia strategy as an extension of its China strategy. The U.S. role in Asia depends on the capacity to operate at many levels simultaneously, not only to focus on one power. The new Administration line-up is not moving in that direction, but the next U.S. Secretary of State also has to be mindful that their department’s agenda is not driven by interests of other institutions.

For the U.S., Ma is very skilful and careful in his remarks and the opposition forces in Taiwan are more realistic than before. Beijing is worried about the shift of governments.

There seems to be kind of truce between China and Taiwan on diplomatic recognition. Regarding weapons sales, the U.S. is perceiving it very carefully. Overall, tensions between China and Taiwan have diminished significantly.

8 Royal Norwegian Ministry of Foreign Affairs – RSIS asian Security Conference 2013

DAY ONE: PLENARY SESSION U.S.-China Relations: Power Contest in Asia Afternoon Session: Reporting from the Breakout Session Maritime Security

a security and potentially a proliferation issue. At the interstate level, China has been trying to hinder the access of other countries’ military vessels to its EEZs. In the case of freedom of navigation, there are very few restrictions on the navigation of commercial fleets and sea denial strategy towards commercial feel is very unlikely, given the self-inflicted damage that would inevitably occur.

An important finding was that maritime security is perceived differently, according to national and industry perspectives. Legal maritime domains also need to be differentiated between the high seas, Exclusive Economic Zones (EEZs) and transit through international straits: there are many differences between these maritime security regimes and we have to look at individual regions and mechanisms. The shipping industry itself is highly transnationalised, with the partial exception of China. Hence, maritime security should transcend national interests.

South China Sea South China Sea is a manageable hotspot. Basically three disputes exist in South China Sea, including sovereignty of the islands, delimitation of maritime boundaries and freedom of navigation. There are two entry points for national states in formulating policies in South China Sea, either as areas to pass, basically transport, or as an area where countries want to protect their resources.

The U.S. typically views the South China Sea as an access point whereas China has an expansionist view on it.

Other countries such as the Philippines might be more resources oriented.

Piracy is legally a matter for the high seas and there might be a link between piracy and terrorism in the case of hostage situations. Organised crime, smuggling and human trafficking are also non-state in nature. In addition, There are transnational concerns such as fisheries to consider. Illegal fishing operations in some cases are politicised, which is being used by some regional countries as an instrument to justify their claims in disputed waters or territories. Sometimes, it is uncertain whether illegal fishing activities are of a private nature or encouraged by state proxy. Another major issue is environmental, raising tricky questions of liability and responsibility where accidents and spillages occur. Smuggling of arms is very much a trans-state matter as well. The question of Iran and North Korea undertaking arm smuggling is

The situation is still potentially dangerous if states try to push for a solution too quickly. Hampering efforts to resolve the various disputes, domestic problems amongst the various claimants risk being transferred to the conflicts in South China Seas. The Asian tendency towards ambiguity, and not necessarily finding a concrete solution, should be borne in mind.

9 Royal Norwegian Ministry of Foreign Affairs – RSIS asian Security Conference 2013

Discussion

China’s position is clear: its sovereignty disputes can only be solved bilaterally. China is committed eventually to concluding a code of conduct in the South China Sea, but distrusts efforts to push China for a quick completion.

For China’s disputes with the U.S., the Chinese government will never compromise on conducting strategic and military action within its EEZs. At the same time, China is willing to participate in dialogues, bilaterally or multilaterally on issues relating to other maritime rights.

However, Deng Xiaoping’s original formula for shelving disputes and pursuing joint development in the South China Sea, is receiving less and less domestic support. The Chinese government is severely constrained by public opinion and some PLA generals. China wants to build up its military strength and naval presences in seas around China and will increase its sovereignty presence in the South China Sea in a gradualist way. China realises that it is not possible for it to carry the burden of maritime disputes with neighbours forever, and will launch bilateral negotiations with neighbours when conditions mature.

Aspired to by former President, Hu Jintao, China is becoming a maritime power and has the capacity to achieve this goal. China is seen not only participating in this kind of discussion, but also beginning to formulate itself as a new normative power. China is not only talking about various regimes and management of maritime affairs, it is beginning to lay down some ideas of what it would like the future maritime regime to be.

While the focus is on South China Sea, attention should also to be given to East China Sea. There are two sets of South China Sea “disputes”: one is between China and regional claimant states and the other is between the U.S. and China. For the territorial disputes between China and regional claimants, there is limited scope for compromise.

10 Royal Norwegian Ministry of Foreign Affairs – RSIS asian Security Conference 2013

Shifting Strategic Alliances, Military Buildup and Driving Forces

as a nuclear weapons state. For the U.S., denuclearisation is the key but counter-proliferation may have to be emphasised given Pyongyang’s insistence on maintaining a nuclear deterrent.

The discussion began with the definitions of arms races/ dynamics and alliances, which states may handle through “band-wagoning,” balancing or hedging. China’s defence budget is growing at around 10 per cent annually. Military spending can be defined as part of modernisation efforts, but there is a lack of transparency as to why China is improving its military capabilities. Is it simply the needs to project the image of a superpower? There could be two different strategies in China: based either on defensive deterrence, or on offensive realism. Regardless of its strategy, perceptions of China’s aggressive potential have grown in the region.

The real question of the present is that South Korea is more likely to retaliate. There is strong fear of miscalculation and misinterpretation from both sides which might then lead to military conflicts. If the collapse of North Korea occurs, it is likely that China will push for a quick resolution in the UN to stabilise North Korea through international forces, but if that is not possible, South Korean control will be acceptable. With regards to peaceful unification, it still suits China quite well to have this buffer since China opposes the U.S. involvement across the whole peninsula.

Opinions are divided on the question of whether the North Korean regime can continue forever. Some say “no”, as information technology makes this impossible for the regime to maintain an information blockade indefinitely; on the other hand, others believe that the regime will continue for the foreseeable future because it can leverage geography and nuclear weapons for its survival.

On strategic alliances, the starting point is that Asia lacks an alliance framework like NATO. Though the U.S. is driving the bilateral relationships with Japan, South Korea and Australia, there are no effective multilateral frameworks in place to manage conflicts or to lower tensions.

Korean Peninsula Despite initial speculation about positive change in North Korea, post Kim Jong-il, there are no clear signs of reform.

For China, stability remains the top priority but the question remains whether China will accept North Korea

11 Royal Norwegian Ministry of Foreign Affairs – RSIS asian Security Conference 2013

Energy Security

push it to become a more responsible stakeholder both in bilateral and multilateral forums. China’s future need for energy could lead to long term cooperation in extracting resources in the Arctic. Regarding renewable energy, China is surpassing the U.S. in renewable energy development and has an even stronger motive to excel in this field. Lastly, China’s growing interest in energy governance presents an opportunity for Norway.

The energy security breakout groups are uniformly positive about the outlook on this very important issue. There are more opportunities than challenges.

Decreasing competition between China and the U.S., due to the U.S. rapidly improving energy situation, was another “plus” factor.

Europe and NATO

There are several important challenges. The first is the shifting of strategic balance due to China’s increasing energy dependence and the U.S. emerging selfsufficiency, which can be seen as opportunity as well.

Increasing energy demand in Asia will likely lead to rising competition among regional countries, which is also a big challenge, prompting further questions:

Some European countries do not see a security role for Europe or NATO in Asia, at least not in the operational sense; others may see the potential in supporting alliances if the security dynamics in East Asia develop along favourable lines. However, it is difficult to foresee an operational role for NATO in the short term.

• W ill an increasingly energy dependent China operate according to market principles?

Supporting U.S. efforts in Asia Pacific is important to ensure solidarity of the alliance in NATO. The U.S. have frequently criticised Europe for not being up to the task. From Europe and NATO’s perspectives, China is not perceived as a threat, thus it might not be a trigger for Europe and NATO engagement in Asia. However, it is apparent that China is becoming more assertive in Europe, including its efforts in exploring resources in the Arctic and Greenland.

• W ill the U.S. motivation to uphold the freedom of high seas decrease in light of rising energy self-sufficiency?

Energy security could be a key focus for cooperation between China and the U.S., including. For China, increasing dependence on energy supply of unstable countries may

12 Royal Norwegian Ministry of Foreign Affairs – RSIS asian Security Conference 2013

Discussion

expansionist, and desire to establish an overseas strategic presence to secure its energy supply.

In the case of Korean Peninsula, what is troubling in reference to the U.S.-China relationship is the inability of the two countries at this point to influence outcomes in North Korea. Regarding NATO and Europe, there is potential for divergence between Europe interest and American expectations.

We are dealing with a highly dynamic situation framed firstly by the emergence of China’s increased presence in regional and global security, political, economic and other dimensions. Second, is the U.S. “rebalancing” to Asia, clearly with China in mind and also reflecting U.S. fundamental core interests in relations across the Pacific.

This region is fundamentally more important to the U.S. than its relations with Europe. Hence, it is not surprising to see an increased share of U.S. resources devoted to this more dynamic region, though other parties may view this as threatening to their security. It also leads to questions about who else draws comfort from an enhanced U.S. presence in the region, how sustainable the re-invigorated U.S. focus will prove, and how deep the U.S. commitment is. If push comes to shove over territorial disputes, is the U.S. prepared to honour its alliance commitments to Japan or the Philippines at the risk of armed conflict with China? Regional countries have to live with the reality that China is already a regional power and increasingly a global power and a maritime power. In this fluid environment, China does not really know where it is going yet in terms of a clear strategy. This concluded the first day’s discussions.

Until now, China has no strategic alliance. Though China has a good alliance with Pakistan, but the country is unstable. North Korea is also very problematic. In future, however, China may decide to have strategic allies. More and more strategic scholars in China think along these lines. Alternatively, China may opt for a partial alliance linked to a particular security objective or function.

China’s overriding interest in the Korean Peninsula is stability, though it also supports denuclearisation and limiting U.S. influence across the whole of the Peninsula.

China is also gradually grooming North Korea towards a reformist direction. China does not oppose Korean unification, but not by force.

In terms of the energy issue, with the U.S. gradually becoming self-reliant on energy, it might become less interventionist, and more inward-looking in future.

For China, the reverse may apply. As China relies more on energy imports of energies, it could become more

13 Royal Norwegian Ministry of Foreign Affairs – RSIS asian Security Conference 2013

14 Royal Norwegian Ministry of Foreign Affairs – RSIS asian Security Conference 2013

15 Royal Norwegian Ministry of Foreign Affairs – RSIS asian Security Conference 2013

DAY two: PLENARY SESSION Southeast Asia and India’s role in changing strategic landscape Prospects for ASEAN as East Asia’s Institutional Hub

based regional architecture have led to doubts about the effectiveness and relevance of “ASEAN centrality,” not least because of ASEAN’s own dysfunctionality and vulnerabilities. The presentation explored alternative visions for East Asian regionalism centred in Washington, Canberra and Singapore/ASEAN. Dr Tan’s presentation concluded on the note that the regional architecture’s evolving variable geometry of concentric circles, and overlapping memberships make reliance on a single, even overarching, institution questionable.

India’s Role in Asia’s Changing Strategic Landscape

Tan See Seng Dr Tan See Seng presented on ASEAN’s prospects for retaining its current role as the hub for East Asia’s multilateral institutions. Dr Tan began with an overview of the “alphabet soup” of post-Cold War multilateral initiatives in East Asia, taking note of the multiple constraints that stand in the way of “strong” Europeanstyle institutionalism, including entrenched preferences for “self-reliance,” norms of non-interference and lingering distrust. He reviewed the relative performance of these institutions. ASEAN “centrality” has emerged as a linking theme across the various economic and security annexes to the regional architecture. Dr Tan subsequently analysed competing visions of regional architecture that exist within the region and how these relate to different external interests and preferences, including U.S.-China competitive dynamics. Arguably, the implicit aim of ASEAN-led regionalism was to “keep the Americans in, the Chinese in check, and ASEAN in charge.”

However, concerns over an underperforming ASEAN-

Rajesh Basrur Professor Rajesh Basrur framed his presentation in the context of high expectations, particularly in the U.S., that have been placed on India as a rising power and alternative Asian power centre to China. He also acknowledged recent skepticism about India’s capacity to deliver on its own ambitions. According to Goldman Sachs, India will overtake the U.S. in purchasing power parity after 2040. India’s role in Asia will increase significantly as U.S. capacity to meet the China challenge reduces.

16 Royal Norwegian Ministry of Foreign Affairs – RSIS asian Security Conference 2013

Outlook for Myanmar

However, the reality check is that China is continuing to widen the gap with India according to a variety of key indicators, including GDP growth and defence spending.

The real change governing India’s international outlook involves a shift from offensive to defensive realism.

In relations with China, Delhi faces the challenge of overcoming the burden of history, perceptions that China has engaged in its own containment strategy directed at India and lingering military threat perceptions on the contested land border. India is adopting a “countercontainment” strategy with elements of internal as well as external balancing. India does not want to provoke China and seeks economic benefits from the relationship. Nor does India want to form an alliance with the United States.

Currently, both sides’ strategic maritime interaction is limited; India has limited power projection capability east of Malacca, while China faces similar constraints in the Indian Ocean.

Tin Maung Maung Than While painting a “conflicting and contradictory” picture of Myanmar’s economic opening, Dr Than highlighted Myanmar’s poor education system and the dysfunctional real estate market as characteristic of a difficult transition.

The presence of cronies compounded the problem.

Best-case outcomes, including “back to the barracks” for the military, might not work. In Myanmar, the messiness of democracy and market reforms was not adequately grasped outside of the country; the residue from socialism remains despite the emphasis on capitalism.

Civil-military relations were problematic, but the absence of any ruling party posed a political dilemma for the next government. The government was under tremendous pressure to implement policies on Foreign Direct Investment. Communal violence and ethnic war augmented the problems Myanmar faces in the throes of its complex transition.

To conclude, India’s capacity to shape the regional security order will remain limited, as will its scope for alliances and alignments. The possibility of India-China conflict is also limited, though under certain conditions India-China relations could worsen, including escalation from a local conflict on the border, or if a major upheaval in China results in an aggressive form of externalisation.

17 Royal Norwegian Ministry of Foreign Affairs – RSIS asian Security Conference 2013

Questions:

from Myanmar conditioned trade with China, with 40-50 per cent of Yunnan’s trade accounted for by Myanmar.

One speaker emphasised the importance of grassroots networks in forging stronger provincial connections.

• W hat is the “glue” to keep ASEAN together in the context of the recent failure to issue a joint communiqué at the Phnom Penh summit in 2012 and the lack of internal cohesion concerning the South China Sea issue? What is the impact of trade agreements on ASEAN-centred confidence building efforts and integration through the East Asian Summit (EAS), the Trans-Pacific Partnership (TPP) and the Regional Comprehensive Economic partnership (RCEP)?

“Looking East”: Perspectives on India’s role

• H ow can ASEAN deal with the multiple challenges posed by its “messy” architecture; the centrifugal force within ASEAN and how member states look at the ASEAN? Thoralf Stenvold • W hat about the negotiations in Myanmar with Kachin ethnic groups and the likely impact, both internal and external, of a lasting ceasefire? What about the role of China in the crisis in Kachin state in Myanmar?

Thoralf Stenvold, Counsellor and Head of Political Affairs at the Royal Norwegian Embassy in New Delhi, opened his presentation by underscoring an observation from day one; the importance of perceptions. The fact that India was allotted a separate session at the conference, was based on the perception that India could possibly be a power in the region on par with China, and as such a balancing actor. The main thrust of Mr. Stenvold’s presentation was to explain why this is not likely to be the case for the foreseeable future.

Answers: On ASEAN, its much-vaunted centrality was “weak,” resembling “centrality without a centre.” The organisation has yet to learn how to pool sovereignty and would remain a low common denominator driver of multilateralism. The gulf between founder members and more recent ASEAN members on many issues was further acknowledged. Singapore and Indonesia wanted change while sovereignty remained the sticking point for more cautious members. The necessity for deeper integration towards the formation of an ASEAN Community had been intellectually grasped. But it remained politically difficult.

Dissonance between ASEAN’s plans for “connectivity” was a further obstacle to institutional integration. On trade and investment, the various sets of bilateral agreements complemented deeper multilateral economic integration, while TPP and RCEP were dual track processes. Overall, the evolving regional architecture remained far away from many of its self-defined objectives. Moreover, ASEAN did not share the vision of any top-down institutional framework for regional security. Therefore, the EAS had been relegated to “just another forum.”

Besides immediate capacity constraints due to security threats in its own neighbourhood, in particular in the north-west (Pakistan/Kashmir) and internally, the most important reason for India’s relative weakness is to be found in its current economic limitations and weakness in governance. Not only is India’s economy less than one-quarter of China’s, but the central government’s total revenues are only $US192 billion, smaller even than Norway’s. While India invests a mere 1 per cent of GDP in public health, the equivalent for China is more than 2.5 per cent. At the same time, the ten richest individuals in India are worth more than 100 billion dollars combined.

This is 40 per cent more than in China. The elephant in the room? Poor governance: India’s lack of public resources and investment in human and physical infrastructure, despite astronomical private wealth, is a fundamental source of India’s weakness. Weak governance is reflected in security terms.

On China’s role in Myanmar, the current government in Myanmar and China were both recalibrating the bilateral relationship, including the role of “soft power.”“Pull” factors 18

Royal Norwegian Ministry of Foreign Affairs – RSIS asian Security Conference 2013

Plenary Wrap-up: Where does all this leave us Back to the future or renewed dynamics?

For one panelist, the various discussions had opened up discrepancies among regional states, most of which sought enhanced roles for themselves. ASEAN had provided a meeting ground but was currently going through an “identity crisis.” On India, there had been a big gap between Delhi’s ambitions to enmesh more with East Asia and the limitations to its actual levels of influence.

In the long run, however, India would eventually acquire more capability. There was also internal policy incoherence within states, including China, about their future strategic course. Regarding current U.S. perceptions towards India, there exist different schools. Notwithstanding the U.S. desire to see India playing the role of a counter balance to China, India had been emerging as an “autonomous power,” still influenced by the trappings of non-alignment.

The U.S. had learned to be more realistic about the prospects for strategic cooperation with India.

The most likely scenario for U.S.-China dynamics going forward was a variation on “muddling through.” The “return” of U.S. to Asia was not a pre-planned strategy either. Challenges and opportunities would continue to arise in the management of U.S.-China relations. To cope with these vicissitudes, “complex negotiations” were the way forward. India was at an advantage in one respect because of her familiarity with complex negotiations in domestic politics, this would help her internationally. New semi-alliances and new alignments might appear in the course of China’s muddling through as a maritime power while the U.S. would remain a Pacific power. Relations with Japan had the biggest potential to complicate this process. On the comparison between the European Union and ASEAN, a view from the panel was that the EU’s focus had been outcome-led, whereas in ASEAN the theme had been on convergence.

Euan Graham

Tormod C. Endresen

The view from the panel on China’s expansion into the Indian Ocean Region saw this as largely economic in nature although it was being perceived in India in terms of “String of Pearls.” China’s economic expansion and presence around the Indian Ocean rim was driven by economic needs of its Western provinces.

A question was raised concerning China’s provinces and their influence on diplomacy. The view from the panel was that the policy role of the provinces had grown in importance. Hence, this aspect influencing China’s external behaviour deserved attention.

19 Royal Norwegian Ministry of Foreign Affairs – RSIS asian Security Conference 2013

The question was also asked whether China will increasingly emulate American thinking and modes of behaviour as its global role and strategic interests continue to expand. One panelist argued that China still sought to break the limits to its expansion whereas the U.S. outlook was shaped as function of its global military power. Another panelist stated that China had always absorbed ideas and practices throughout its interactive history. China had also learned from contemporary history, including the successes and failures of U.S. strategies, the Soviet intervention in Afghanistan and the unique lessons from its own long civilisation. China’s economic ambition is unlimited whereas its strategic aspirations were limited.

One panelist commented that capitalism had shown its “ugly face” as the cost of China’s adherence to marketbased approaches.

In the concluding remarks, one panelist argued that the bumpy drive towards interdependence reflected the inevitability of conflicting politics and perceptions between the U.S. and China. Interdependence would create complexity and thus a key role would fall to the smaller states, in managing tensions between the great powers. Norway could lead by example on approaches to market-based development and social responsibility.

Norway was also well placed promote concepts of social justice in the region. Finally, Ambassador Endresen remarked in conclusion that several “cakes” were offered on the global governance table, with differing tastes and ingredients. Norway needed to learn how to involve itself further as the region muddles through in the face of continuing uncertainty.

Panelists were asked if regional perceptions of China’s behaviour had departed from the “peaceful rise” narrative.

A question was also asked about China’s disposition towards capitalism and how this shaped Beijing’s approach towards global institutions and governance.

20 Royal Norwegian Ministry of Foreign Affairs – RSIS asian Security Conference 2013