Not Since Nixon Has a U.S. President Faced Such a Tough China Challenge

December 18, 2016 Topic: Security Region: Asia Tags: Donald TrumpChinaTradeTrans-Pacific PartnershipDefense

Not Since Nixon Has a U.S. President Faced Such a Tough China Challenge

China now has more tools of economic statecraft and military power than ever before.

A SECOND challenge Trump will face is that even when Beijing and Washington share interests, these are, too often, overly general in nature—“peace,” “stability,” “security,” “nonprovocation” and so on. Often, the two sides fall flat when trying to turn their common interests into complementary policies.

The United States and China actually have a long history of cooperating around the world, including in sensitive regions around China’s periphery.

Consider Afghanistan. Recent strains belie the degree to which Beijing and Washington worked jointly to defeat the Soviet occupation of Afghanistan in the 1980s. The United States encouraged Chinese support for the Afghan mujahideen, and the two countries cooperated in other novel ways during the conflict.

Today, by contrast, the two capitals are often at loggerheads in such places. For instance, before Myanmar’s political transition to Daw Aung San Suu Kyi’s government, U.S. officials argued that Beijing’s policies only helped to bolster the ruling junta. Likewise, Americans argue that Chinese trade and investment policies shield North Korea from the effects of the very international sanctions Beijing voted for.

For their part, Chinese officials view U.S. policies in some of these countries as naïve at best, destabilizing at worst. In Central Asia, for example, while serving as deputy assistant secretary of state for the region in 2006 and 2007, I heard Chinese officials argue ad infinitum that U.S. actions to promote political reform would ultimately “destabilize” these countries.

Does coordination really have to be so hard? The challenge for Trump’s administration is threefold.

First, the two countries need to better align their threat assessments. So for all that Washington may have security tensions with China, what is needed is a more intensive strategic and contingency planning discussion. Beijing, quite simply, does not share American assessments of the scope and urgency of some important threats. And China’s leaders, even when they do sense a challenge to “stability,” are more relaxed about them than Americans.

This is true of Pakistan, where Beijing tends to trust the military’s instincts implicitly. It is true of Iran. And it is true of North Korea. Few Chinese believe Kim Jong-un’s regime will collapse. Beijing will not push Pyongyang over the precipice and retains hope for a managed transition toward Chinese-style reform.

Second, even when Beijing shares Washington’s sense of threat, countervailing interests can obstruct cooperation. In Afghanistan, China has certainly shared America’s core interest in a stable Afghan state that does not harbor, nurture or export terrorism. But Chinese decisionmakers were never comfortable in the 2000s with NATO access arrangements across China’s western border in pursuit of this objective, much less enhanced U.S. strategic coordination with neighbors that have difficult relations with Beijing.

Third, the administration needs to overcome the contradictory U.S. and Chinese ranking of shared objectives. In North Korea, both value stability and denuclearization, but China values stability much more, while the United States has been prepared to risk some stability to achieve denuclearization.

To deal with these obstacles, Washington and Beijing badly need a track record of concrete successes in places where shared strategic interests exist but are often too abstract.

Doing so will not require joint projects and actions, merely complementary ones. Take, for instance, counternarcotics in Afghanistan and Central Asia: China works bilaterally and through the Shanghai Cooperation Organization; the United States works mostly bilaterally through security assistance and capacity building. Washington and Beijing do not need joint efforts to pursue their shared goal, just to coordinate areas of focus, direct their financial assistance at similar drugs-related goals, and build complementary capacity while maintaining separate efforts.

ULTIMATELY, THE global arena, not East Asia, is likely to be more conducive to near-term cooperation. And while global cooperation cannot mitigate security tensions in the Pacific, it will further enlarge the field for action.

To deploy an American baseball metaphor, such cooperation does not always mean the two sides should “swing for the fences.” Often, the United States has sought cooperation with China around the world, but failed. By working on more peripheral issues, the two countries have a chance to work over time toward more significant strategic ones.

In particular, better coordinating some international economic policies will likely prove easier than coordinating security policies. One example would be to encourage even more coordination between the international financial institutions and the new China-backed Asian Infrastructure Investment Bank. Even if the United States does not join the AIIB, it can encourage and promote cofinancing of projects via its voting weight and project support to more established structures. This would provide the United States and China with some multilateral “cover,” and thus prove easier than coordinating bilaterally.

Another example would be to jointly shape investment standards in other countries and regions, like Africa. China’s arrival as a trader, investor, lender and builder has dramatically changed the economic environment around the world because, while Chinese investors are not oblivious to the challenges of doing business in, say, Papua New Guinea or Niger, they have taken on risks where American, Japanese and European firms have not. And China has already displaced other, more traditional partners across an array of sectors.

Chinese strategies are hardly uniform. Nor have they proved to be uniformly successful. Resources for infrastructure deals have benefited Chinese construction, telecommunications and hydropower companies. But Chinese oil and mining companies have failed to dominate Africa’s extractive industries, for example. And significant infrastructure investments in mineral-rich countries have not given Chinese firms a preferential position.

Many American analysts take for granted that Chinese companies can bear more risk, or that Beijing will underwrite the kind of risks that other governments shy away from. But as China’s reach grows, its economic incentive to revisit these practices may expand, not least to protect its own investments. Chinese companies no longer operate alone in many places, and are seeking partnerships—first to acquire technology, second to share risk, and third to connect to new skills and industry practices. The Chinese even surprised their State Department counterparts in a mid-2000s round of policy-planning discussions by asking about the good-governance provisions in President Bush’s Millennium Challenge development fund.

Chinese firms, backed by state loans, face growing constraints in countries that have stringent local content rules. So there are limits to China’s traditional approach: The weaker the state, the more appealing is China’s model of trading loans and infrastructure for resources. But the stronger the state, the more wary countries are likely to be of falling into a debilitating trap of dependence.

And that opens up some potential space for the United States and China (and third parties) to work jointly on standards, investment models and other issues in partnership.

THE BOTTOM line is that President Trump will face a tougher challenge with Beijing than have his eight predecessors since the 1972 Nixon opening. China is now weightier, more influential around the world, better able to resist or retaliate against U.S. pressure, and has more tools of economic statecraft and military power than ever before.

This means that Washington needs to move from reactive to activist in its approach to both China and Asia. After all, for much of the last decade—and with the exception of the now-shelved TPP—the United States has too often found itself acting in response to a Chinese initiative.

The AIIB is just one example. The United States offered no distinctively “American” model of infrastructure finance for Asia, failed to complete governance reforms in the existing international financial institutions, chose to forego the opportunity to shape the bank early on, and then discouraged its allies and others from joining. The result was that Washington was left responding to a Chinese initiative (and ended up isolated from nearly all of its allies) rather than setting the action agenda itself. Likewise in the South China Sea: the United States increasingly seems to conduct freedom-of-navigation operations in response to Chinese island building or other actions, rather than as a function of strategy.

American interests in the Pacific have been consistent for more than a century: open markets; open regionalism; freedom of navigation; no exclusionary blocs or dominant regional hegemons that might exclude the United States; support for political and economic openness; and, in the postwar period, support for allies.

It would be the height of irony if the United States, Asia’s principal champion of openness since the nineteenth century, begins to close itself off from the region. If the new administration pursues tough-minded, productive relations with China, but anchors it very firmly within this larger context of strategy in Asia, then it will be off to a realistic start.

Evan A. Feigenbaum is vice chairman of the Paulson Institute at the University of Chicago. During the George W. Bush administration, he served as deputy assistant secretary of state for South Asia, deputy assistant secretary of state for Central Asia, and on the secretary of state’s policy planning staff with principal responsibility for East Asia and the Pacific.

Image: Forbidden City. Flickr/Creative Commons/Yiannis Theologos Michellis