China’s achilles’ heels

By
Vikas Kumar, Guest Contributor
– 14 August 2011Posted in: China

China’s rapidly growing defence budget and aggressive posturing in recent maritime disputes with Japan, the Philippines, and Vietnam have caused widespread concern. Policy-makers across Asia-Pacific are panicking at the possibility of China’s premature rise as the regional, and possibly the global, hegemon. A reality check is in order because China’s hegemonic ambitions are more likely than not going to be constrained by a constellation of geographical, political, historical, technological, and domestic factors.

The Chinese economy is already possibly the largest (on a purchasing power parity basis) in the world and its share in global output and trade will continue to rise in the near future. But there is no necessary relationship between the economic and geo-political ascendance of a country. Moreover, even the most optimistic estimates suggest that China, with an ageing and an increasingly restive population, needs at least two decades to catch up with the United States’ economy in real terms, assuming the latter continues to decline irreversibly. But two decades is a long time.

In the meantime, the most significant obstacle to China’s political ascendance is its inability to manage its own neighbourhood, let alone legitimately lead it. A number of structural factors limit its capacity to overcome this obstacle. First, China is much larger than all its neighbours put together, accounting for as much as half of its neighbourhood’s area, population, economic output, foreign exchange and gold reserves, and armed forces. The consequent power differentials translate into a sense of insecurity in its neighbourhood.

Second, given its central location within its neighbourhood and enormous geographical expanse, it shares land and maritime borders with most of the countries in the region of immediate interest to it. Conventional conflicts are not decreasing in shared border areas, particularly when borders are not settled beyond dispute and multilateral fora like ASEAN that could arbitrate territorial disputes are weak. The possibility of such conflicts accentuates the aforesaid sense of insecurity in China’s neighbourhood.

Third, the next largest countries (Japan and Indonesia) and economies (Japan and South Korea) in China’s neighbourhood are not that small either, which fosters regional polarization and limits China’s capacity to achieve regional hegemony. In addition, a number of countries in the wider neighbourhood of China have nuclear capacity (North Korea, Japan, Russia, India, and Pakistan), which further limits China’s hegemonic ambitions.

The disunity and conflict engendered by geographical factors are further aggravated by differences in political systems and divisive historical memories. The sense of insecurity of smaller countries in China’s neighbourhood is, in fact, persistent in nature and engenders a steady demand for external intervention in regional conflicts involving China. So, it is not difficult for outsiders to interfere and thwart consensus in China’s neighbourhood. The existence of a global superpower and regional powers based in other parts of the world with trans-regional, and at times global reach, ensures an adequate supply of such intervention. The ease with which the United States rejuvenated its military ties with Japan and the Philippines and improved its relationship with Vietnam after the recent maritime disputes in East Asia is a case in point. Even an economically weakened United States is difficult to ouster from East Asia because it has already incurred the sunk cost of entrenching itself across the region and it can share the burden of recurring expenses with China’s wealthier neighbours, who in the foreseeable future will continue to depend on the United States even for routine self-defence. This ensures that there will be sufficient support for status quo favourable to the United States in China’s neighbourhood, which in turn severely limits China’s capacity to build consensus for an alternative international system. So, it would be inappropriate to confuse China’s ability to secure, say, greater voting rights in international institutions with an imminent potential to alter their basic structure.

Developing countries, including some in China’s neighbourhood, support greater Chinese claims within the current international system. But their support does not arise from a fundamental revision of their threat assessment. Rather these countries believe that there are positive externalities from Chinese-led weakening of the West’s control over existing international institutions. The principles on which China’s claims – share of world’s population, economic output, trade, etc – are accepted also legitimize a similar demand of other rising powers. But these same countries will oppose China if the latter tries to remake the world order in its own image. On other hand, to balance a rising China the West is prepared to supply better shares to other rising powers. So, China faces international collective action problem that limits its geo-political ascendance.

In any case, even without binding regional constraints and collective action problem, China is a few decades away from acquiring technological capacity to project power across the world. And even if technological constraints are surmountable in the foreseeable future, China is unlikely to receive an invite from any Western country to mediate in intra-Western conflicts. However, the United States will continue to be sought after by China’s dissidents and neighbours while technological limitations continue to constrain China’s capacity to respond in kind in the United States’ backyard. Interestingly, China cannot become world’s technology leader as long it is a closed society. Lack of freedom invites Western “interference” via dissidents that cannot be countered adequately among other things due to technological limitations. This closes the circle that can be broken only through political liberalization, which will weaken the Communist Party of China.

To conclude, the capacity of China to challenge the United States as the provider of global public goods like international security, international political institutions, and new technologies will continue to be constrained in the near future. This in turn will check its geo-political ascendance. Here three additional observations are in order that reinforce the above conclusion. First, the effective gap between the United States and China is greater than the perceived gap because of the former’s relatively greater capacity to self-doubt. Second, the purportedly declining United States has an enormous capacity to revitalize itself. Obama’s election is just one manifestation of that capacity. Third, the present disunity within the West is not irreversible, particularly if China asserts itself too soon. A unified West would be practically invincible in the foreseeable future.

And, in any case, unrest in the Han majority regions (particularly in the countryside) due to growing economic inequality, chronic unrest in the ethnic minority regions (that constitute more than 60% of China’s area), and the potentially impending political transition will limit China’s capacity to sustain aggression abroad. So, in the foreseeable future, international posturing notwithstanding China will continue to be an inward-looking, defensive power.

Vikas Kumar is an Assistant Professor of Economics at Azim Premji University, Bangalore.