For China, it's damned if you do, damned if you don't

Professor Wang Gungwu referred to the Chinese imperial eunuch Zheng He's famous voyages in the 15th century as an example to suggest that the Chinese civilisation has historically been focused on accumulating "economic wealth and technological brilliance". These objectives could also be what a rapidly growing China is after today.

Prof Wang's essay, published in The Straits Times on Monday as part of the SG+50: Future Trends 2065 Essay Series, came a day after the Shangri-La Dialogue, a high-level security summit which brought together top defence officials from around the world.

Like in previous years, this year's Shangri-La Dialogue saw discussions on the South China Sea disputes take centre stage. Many policymakers, scholars and journalists took the opportunity to pepper the Chinese representative, the People's Liberation Army deputy chief of general staff Admiral Sun Jianguo, with questions on China's reclamation activities and actions in the South China Sea. There was also a strong strategic focus on China's recent ambitious economic initiatives, namely the Asian Infrastructure Investment Bank (AIIB), as well as the Silk Road Economic Belt and 21st Century Maritime Silk Road ("One Belt One Road").

To Beijing, the uneasiness and reluctance of regional countries to jump onto the Chinese economic bandwagon is mystifying. As China sees it, the geopolitical structure in the region necessarily has to be realigned with the new economic order. In addition, China views their recent economic initiatives as heeding international calls for China to stop being a "free rider" in global trade, and to positively contribute to Asia's infrastructure and economic development.

And yet these very initiatives are being perceived by the United States and its allies as China's attempts to gain political and strategic influence at their expense. Most notably, the US has explicitly voiced concerns that China's

AIIB would not meet governance standards of other international institutions, and has lobbied its allies - albeit unsuccessfully - to not join the new bank. In China's eyes, this is truly a case of "damned if you do, damned if you don't".

Why are there such conflicting expectations from all parties? The US, as well as countries in the region that are accustomed to the model and international order as defined by the US, expect that rising powers would seek to increasingly maximise their global dominance. If China attempts to do so in the Asia-Pacific region, it would only be a matter of time that the Pacific Ocean will be, in Prime Minister Lee Hsien Loong's words, "carved up into two spheres of influence". Countries in the region will then be forced to choose sides - a situation that they have been trying to avoid.

This scenario, however, appears to be a common expectation among mainstream international relations scholars. As the renowned American scholar John Mearsheimer asserted: "If China continues to grow economically, it will attempt to dominate Asia the way the United States dominates the Western Hemisphere... China will seek to grow its economy and become so powerful that it can dictate the boundaries of acceptable behaviour to neighbouring countries, and make it clear they will pay a substantial price if they do not follow the rules."

Such assumptions, taken together with China's assertiveness in the South and East China seas, necessarily lead to immense suspicion among both the US and regional countries concerning China's intentions and initiatives.

However, will China necessarily increasingly wield its economic power to coerce other states in the region? There are two reasons why this may not be the case.

First, while all countries are expected to pursue their national interests, the idea of "national interests" is not a "one size fits all" concept. As Prof Wang suggested in his essay, China may prioritise being perceived and recognised by other countries as a great modern civilisation through its economic and cultural achievements. To sustain political legitimacy, China cannot appear to be ceding territory. However, there is also no reason to expect China to turn aggressive both militarily and economically.

Second, the Chinese leaders and elite have for a very long time portrayed Western use of economic tools, such as sanctions, as imperialist and interventionist. Professor Harry Harding took the opportunity of the Shangri-La Dialogue to question Adm Sun on whether China has moved on from its "Century of Humiliation" narrative.

However, there may also be a normative element surrounding China's narrative of national humiliation. Chinese leaders will be seen as disingenuous if they wield economic tools in a similar fashion to a Western model that they have been criticising for decades. China may therefore be keen to pursue an alternative model of economic statecraft - one that focuses on providing incentives and inducements - which the AIIB and One Belt One Road initiatives are key parts of.

China faces two challenges if this is indeed the case.

First, Beijing should rapidly come to terms with why regional countries are so suspicious of its economic initiatives. After all, as PM Lee once said, "In Asia, trade is strategy."

Second, China needs to better communicate its intent to all relevant countries. The fact that many of these initiatives fall under the purview of China's National Development and Reform Commission (an agency focusing on economic policymaking) has made implementation details elusive to Chinese foreign and defence diplomats. Their inability to directly address concerns regarding these initiatives may well be a result of unfamiliarity and uncertainty, but this will for sure be perceived by a foreign audience as being evasive at best.

At the same time, countries in the region should avoid the temptation to link all of China's diplomatic efforts and initiatives to its assertiveness over maritime disputes, and recognise instead that win-win co-operation can genuinely be achieved.

A greater appreciation of Chinese history and culture could allow one to better understand why China is behaving in a seemingly contradictory manner - by dispensing economic carrots on the one hand and behaving assertively over maritime disputes on the other hand. As the American scholar Joseph Nye famously proclaimed: "War is never inevitable, though the belief that it is can become one of its causes."

Regional countries' willingness to join the AIIB is a positive sign, as attempts to limit China's ambitions will only lead to further mistrust. It is in the region's best interest that the US and Japan recognise this as well in the near future.

The writer is a PhD candidate at the S. Rajaratnam School of International Studies, Nanyang Technological University.

This article was first published on June 4, 2015.
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