The Asia-Pacific continued over the past year to squander its most precious asset: the confident expectation that the region could preserve order and stability while managing a strategic transformation of historic proportions. The states of the region are still spending a lot of time in dialogue but along critical channels the degree of engagement, communication, and understanding appears to have encountered sharply diminishing returns.

This trend in attitudes is not confined to the media but extends to political circles in most states of the region. For the first time in 10 years, the 2015 risk assessment prepared for the World Economic Forum listed ‘interstate war’ as the most likely of the risks that could have a significant negative impact on the global economic outlook. Further, some of the world’s most respected academics are expressing concern, most recently Graham Allison, director of the Belfer Center for Science and International Affairs at Harvard.  Writing in The Atlantic (September 2015) Allison suggested that war between the U.S. and China is “more likely than is recognized at the moment.” The sense one has is not of imminent war but of a wearing down of the margin of safety, the room for error and the capacity to absorb shocks that we could regret in the future.

The United States and China are at the core of this adverse trend and the U.S., in particular, appears to have become more resigned to the likelihood that achieving a stable co-existence with a powerful China will involve a prolonged period of geopolitical contestation.  Fortunately, President Xi Jinping’s first state visit to the U.S. in September 2015 went reasonably well. They sustained their strong posture on climate change, reached an important agreement on managing air-to-air encounters, and strengthened their commitment on state-sponsored economic cybertheft to an undertaking that neither government would ‘conduct or condone’ such activities. On the other hand, Xi’s proposal to work toward a new model of major country relations remained at the level of abstract, motherhood assertions well removed from the attitudes and perceptions driving the actual conduct of the two parties.

Beijing was managing the launch of its popular Asian Infrastructure Investment Bank, had proposals in play for enhanced land and maritime trade routes that it wanted to call new  ‘silk roads’ and was assigning major prominence to an amalgamation of these proposals in  the ‘One Belt, One Road’ concept. Beijing also quietly launched a carefully pre-planned program to develop seven submerged features in the Spratly Group in the South China Sea into artificial islands, some large enough to dock ships and/or with 3,000-meter runways for medium-sized fixed wing aircraft. This program surged rapidly into a frantic, large-scale operation that, in the age of satellite photography, gradually pushed the rest of Beijing’s foreign and security policy agenda off center stage. By mid-2015, the political climate in the Asia-Pacific had become noticeably colder and more complicated.

The U.S. pointedly flew maritime surveillance aircraft close to the new islands and several naval exercises were conducted in the area (Japan – Philippines; US-Philippines; and China). ASEAN leaders (in April 2015) and foreign ministers (in August 2015) issued statements that described this lightning transformation of the Spratly Island group as having “…eroded trust and confidence and may undermine peace, security and stability in the South China Sea.” Beijing’s public diplomacy on the episode was something of a tangle, ranging from pugnacious statements that it could do whatever it wanted with its possessions in the South China Sea, through claiming that it was doing no more than other claimants had already done, to the assertion that the new islands would enable China to be a better neighbor in the area. Beijing has discreetly but carefully protected the option of using the new islands to introduce new military capabilities to the South China Sea. This will further ensure that this issue will become imbedded as a source of controversy and instability.

In 2014, one of the more prominent concerns fueling pessimism about the regional security outlook was the enduring rift between China and Japan, especially the fact that years were slipping by without a face-to face leaders meeting. That standoff seemed to end at the APEC summit in Beijing in November 2014. Early in the new year, the foreign ministers of China, Japan, and South Korea conducted a positive meeting that seemed to promise further engagement at the leaders level. These hopes faded amid further signals that the region would continue to look back rather than start to build a reliably different future.

The reconstruction of the China-Japan relationship is therefore a critical piece of business that remains on the regional agenda. These two countries, in particular, need to think carefully not only about whether Japan’s security policy reforms can credibly be seen as a revival of militarism but also about why the Abe government has been prepared to incur severe, possibly even fatal, political injury to secure these qualified amendments to the role of the Japan Self-Defense Forces. Opinions vary rather widely on where the balance of responsibility for the current impasse should be located but there can be no doubt that both sides have work to do to jettison the baggage of the past and define the options for the future. Despite these ongoing stresses, there were indications that a trilateral summit (China, Japan, and South Korea) might still be agreed for late October or November 2015.

Further evidence of a perceived deficit in the region’s capacity to cope peacefully with current and expected future stresses has been the continued attractiveness of hedging against the current order. A political appetite for new or the further qualitative enhancement of recently established security ties remained evident across the region.

If it is accepted that a special effort should be made to arrest the ongoing erosion of the security order in the Asia-Pacific and shift the trend of events onto a more positive trajectory, who might take the lead and what could they seek to accomplish? On the whole, it is hard to argue that a basic deficiency is a lack of opportunities for key decision makers to meet and address the big issues confronting the region. The problem, particularly in the case of the U.S. and China, seems to be an inability or unwillingness to engage substantively in the processes available to them. If circumstances are considered to be sufficiently worrying or are deemed to have the potential to reach such depths, interrupting an adverse trajectory and inviting consideration of more positive alternatives is a challenge that may fall to the region’s so-called ‘middle powers.’  This is not a challenge to be lightly proposed or accepted. Canvassing regional concerns and remedies, and reflecting them with integrity as the inspiration behind a novel approach or process that would attract the earnest engagement of the U.S. and China is no trivial undertaking. The scope to appear as some combination of biased, naive, unimaginative and incompetent is considerable. But it may be prudent for states like South Korea and Australia to discreetly engage in preparatory discussions on such an initiative.

Ron Huisken is an adjunct associate professor, Strategic & Defence Studies Centre, Australian National University. This is an extract from the introduction to the forthcoming Regional Security Outlook 2016, prepared for the Council on Security Cooperation in the Asia Pacific and edited by the author. It will be available next week at www.cscap.org. This first appeared in Pacforum CSIS Newsletter here.

Image: Flickr/Official U.S. Air Force