China's gradual assumption of Asian central stage?

Interesting article from the New York Times: Any comments?

http://www.nytimes.com/2003/10/18/international/asia/18CHIN.html?th=&pagewanted=all&position=

Asian Leaders Find China a More Cordial Neighbor
By JANE PERLEZ

Published: October 18, 2003


ANGKOK, Oct. 17 ? More than 50 years of American dominance in Asia is subtly but unmistakably eroding as Asian countries look toward China as the increasingly vital regional power, political and business leaders in Asia say.

China's churning economic engine, coupled with trade deals and friendly diplomacy, have transformed it from a country to be feared to one that beckons, these regional leaders say.

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That new, more benign view of China by its neighbors has emerged in the last year as President Bush is perceived in Asia to have pressed America's campaign on terror to the exclusion of almost everything else.

The most recent efforts by the administration to persuade China to revalue its currency are seen, many in the region say, as an unproductive use of American political capital.

Symbolically, perhaps, the Chinese president, Hu Jintao, landed a day ahead of Mr. Bush in Thailand, still basking in the afterglow of China's first space mission. The Chinese leader was welcomed with banner headlines and a sumptuous dinner given by King Bhumibol in his golden-roofed Bangkok palace.

Both leaders are being accorded a state visit to Thailand before the opening on Monday of the 21-member Asia-Pacific Economic Cooperation meeting. Then, almost in tandem, they will move south to Australia, where Mr. Bush will address Parliament on Thursday, followed the next day by Mr. Hu.

The United States' two most important strategic Asian allies, Japan and South Korea, are particularly benefiting from China's growth. Last year for the first time, Japan's imports from China surpassed those from the United States. At the same time, Japanese exports to China surged by 39.3 percent. China has now become South Korea's largest trading partner.

One prominent Singaporean businessman, Ho Kwon Ping, illustrates the shift in Asian attitudes toward China. Compared to a year ago, he said, Asians are viewing China as a "cup half full, not half empty."

Mr. Ho, the executive chairman of the Banyan Tree Resorts hotel chain and a member of the board of Singapore Airlines, gave speeches in Hong Kong and London last year describing China as a juggernaut poised to smother the weak economies and less educated populations of Southeast Asia.

Now, he says, "The perception is that China is trying to do its best to please, assist, accommodate its neighbors while the United States is perceived as a country involved more and more on its own foreign policy agenda, and strong-arming everyone onto that agenda."

China is streaking ahead, developing its technology, advanced education and scientific and other research at extraordinary rates, and Asian countries now see that as an opportunity.

"They are not seeing a China that threatens their economic livelihood," Mr. Ho said.

The United States remains the region's biggest trading partner, but trade between China and the rest of Asia is booming, and China is also offering attractive add-ons: new investment and nonthreatening diplomacy. In a direct challenge to the United States, Prime Minister Wen Jiabao of China urged Southeast Asian nations last week to achieve $100 billion worth of trade with China in two years, nearly double the current $55 billion volume. American trade with the 10 members of the Association of Southeast Asian Nations, or Asean, was $120 billion in 2001.

There, and farther south, in Australia, China is scooping up raw materials that it needs for its rapid modernization: liquid natural gas from Indonesia and Australia, iron ore from Australia, rubber and palm oil from Malaysia.

In Australia, President Hu is planning to sign an agreement that will make China not just a customer but an investor in the North West Shelf gas venture.

China began its formal courtship with the countries of Southeast Asia a year and a half ago when it offered a free trade agreement with the members of Asean by 2015.

The United States countered last October with the Enterprise for Asean Initiative, a plan to offer bilateral free trade agreements with Southeast Asian countries that were already members of the World Trade Organization.

Washington completed the first of those with Singapore this summer. President Bush is expected to announce the start of a similar agreement with Thailand this weekend.

The United States trade representative, Robert B. Zoellick, said Friday in an interview here that China's offer of a free trade accord with Southeast Asia was a "thoughtful move" that "institutionalized what these countries now recognize: that China's growth is a benefit to them."

But Mr. Zoellick said that once trade agreements between individual Asean members and the United States were completed they would be worth more than deals with China.

"Ours are more complex and comprehensive," he said, noting that the United States still represented more than 25 percent of the world's economy.

In Singapore, one of America's staunchest Asian friends, the political leadership has begun to sketch what it sees as the coming redistribution of power in Asia.

The prime minister, Goh Chok Tong, last week outlined a situation in which the relative roles of Japan and South Korea would diminish and that of China would grow.

The United States would remain the most significant power in the region, but the inevitably competitive relationship between Washington and Beijing would have far-reaching consequences, Mr. Goh said.

"All Asian leaders are looking ahead at the relentless economic march of China," he said.

On the diplomatic front, China and the United States are enjoying a friendly phase, one that Secretary of State Colin L. Powell described recently as the best since 1972, when President Nixon visited Beijing. Formal diplomatic relations began in 1979.

For now, this cordiality helps other Asian countries deepen their contacts with China without forcing a choice between Washington and Beijing, diplomats in the region say.

Some of China's specific diplomatic moves in the last few months, particularly its efforts to bring Washington and North Korea together, have been widely praised elsewhere in Asia.

In a less publicized but important step, President Hu met with Prime Minister Junichiro Koizumi of Japan on May 31 in the Russian city of St. Petersburg, a gesture viewed as a way to start improving the icy Chinese-Japanese relationship.

That kind of Chinese diplomacy is contrasted by Asians with some of President Bush's remarks about the region.

Answering a reporter's question before leaving Washington, Mr. Bush said mostly white Australia was not just a deputy sheriff for Asia, as the reporter suggested, but a "sheriff."

This word, particularly associated with a major American military ally, provokes shudders and distaste across Asia. The Australian defense minister, Robert Hill, hurriedly disowned the comparison.

"It remains too soon to pronounce that Asia has become `China-centric,' " said David Shambaugh, professor of international affairs at George Washington University and a specialist on the Chinese military.

"But the trend lines are clearly moving in that direction," he said. "To some extent this means that the United States is being replaced as the main power in Asia, but that perspective is really too simplified. The reality is that the United States and China together are dominating the region."


(Interestingly, Australia, which was very Asia-focussed under the previous Labor government, and turned back very much towards Europe and the United States (helped, of course, by the Asian economic downturn of the time) under the current conservative government, is being warned by some economists that we have let our trade surge with the Chinese lapse - and this needs to change.)