Country Report: China (October 2019)

Danielle F. S. Cohen (assisted by Dong Jiaxin)

In the middle of 2019, Chinese experts evaluated the state of South Korea–Japan relations, which deteriorated sharply during the summer of 2019 with the Japanese imposition of export controls toward South Korea. Continuing their careful attention to Indian foreign policy, Chinese analysts examined expanding India–Vietnam maritime cooperation and its implications for the South China Sea dispute. They also assessed American perceptions of China’s “community of common destiny” concept and offered recommendations for how to promote an understanding of this concept that better aligns with Chinese interests.

South Korea–Japan relations

In Xiandai Guoji Guanxi, No. 8, 2019, Liu Rongrong and Wang Shan evaluate the deteriorating South Korea–Japan relationship. Liu and Wang trace the beginning of worsening bilateral ties to Moon Jae-in’s 2017 election, after which he took steps to review the 2015 “comfort women” agreement. Liu and Wang argue that the December 2017 South Korean report on the process by which the agreement was reached, combined with the November 2018 decision to shut down the Reconciliation and Healing Foundation established by the agreement to disburse funds to former “comfort women,” amount in practice to a total rejection of the 2015 agreement. Bilateral relations were further damaged by decisions by the South Korean Supreme Court and Seoul High Court to uphold lower court rulings requiring Japanese companies to pay damages to former forced laborers and their survivors. A follow up ruling allowed for the seizure of the assets of Japanese companies to pay these damages. Japan strongly opposes these court decisions and argues that the issue was previously settled by the 1965 treaty reestablishing diplomatic relations between the two countries. Liu and Wang argue that Japan’s decision to launch a trade war with South Korea during the summer of 2019 by implementing export controls and removing South Korea from its fast-track trade “white list” constitutes retaliation for South Korea’s management of these historical issues, despite Japan’s claims to the contrary. By limiting the export of three key materials necessary for the production of semiconductors, Japan has put significant restrictions on critical South Korean industries.

Liu and Wang contend that the bilateral tensions are unlikely to be resolved in the short-term and will be hard to control. They view Japan’s decision to use economic measures to achieve political objectives as a shift from its general postwar policy of separating economic and political issues and liken it to what they see as the bullying approach employed by the Trump administration. They also note that while South Korea initially took a more assertive position while Japan was on the defensive, this dynamic has reversed since the 2018 radar lock-on dispute. Liu and Wang further argue that Japan’s meticulously engineered trade war demonstrates its latent power and has been designed to both maximize pressure on the South Korean economy and minimize South Korea’s ability to seek relief from the WTO.

Although the “comfort women” and forced labor disputes are the immediate catalysts for the deterioration in bilateral relations, Liu and Wang identify five key underlying causes. First, they view these recent disputes as new manifestations of old problems that have never been fully resolved. The two sides signed their 1965 agreement in the context of the Cold War, when it made sense to bury historical problems in the interest of shared security concerns. The end of the Cold War and South Korea’s growing strength caused it to question that earlier calculation. The election of Moon, a former human rights attorney, marks the rise of a progressive element in South Korea, which takes a dim view of the compromises previous South Korean administrations took on the rights-related issues of “comfort women” and forced labor. The Abe administration is similarly firm in its position, reflecting the rise of Japanese conservatism and a desire to “move past” the burdens of the war.

Second, overall shifts in the two countries’ diplomatic arrangements have further aggravated the bilateral relationship. When Abe was reelected as leader of the LDP in September 2018, he announced his intention to “sum up” Japan’s post-war diplomacy and enable Japan to move beyond the legacies of the war. However, the continued salience of Japan’s wartime and colonial behavior in South Korea–Japan relations challenges this approach. Japan also faces a difficult set of regional relations, although the improvement in the Sino–Japanese relationship has been a bright spot that has given Abe more diplomatic room to maneuver. The Trump administration’s firm pressure on Japan has, in Liu and Wang’s view, unsettled the Japanese leadership in ways that subconsciously affect its relationship with other countries. Japan has tried to improve relations with Russia, but these efforts have been hampered by continued territorial issues. Japan needs a breakthrough in its regional relations, but it is unlikely to find one anytime soon with South Korea. Meanwhile, the easing of tensions on the Korean Peninsula has made policy coordination with Japan less necessary for South Korea. Instead, Moon has emphasized relations with China, ASEAN, Russia, and the United States. Japan’s efforts to convince South Korea to join it in balancing China have been largely unsuccessful, given South Korea’s economic reliance on China.

Third, nationalist sentiment in both Japan and South Korea has increased, which limits the two sides’ diplomatic options. According to surveys conducted in the summer of 2019, for example, only 20 percent of Japanese hold positive views toward South Korea, while only 12 percent of South Koreans hold positive views toward Japan. Moon’s approval ratings, which initially fell because of dissatisfaction with the South Korean economy, rose after trade tensions with Japan emerged. Moon’s firm position on historical issues is a way for him to gain support. Similarly, Abe has relied on nationalism to shore up his own domestic support.

Fourth, the Trump administration’s de-emphasis of the alliance system in the Asia-Pacific has important implications for South Korea–Japan tensions. Under the Obama administration, the United States switched from a hub-and-spokes model of alliance relations to a network model, in which it saw positive relations between its allies as an important component in responding to China’s rise. By contrast, the Trump administration has pursued unilateral and isolationist policies rather than relying on its alliance relations. Consequently, it has been uninterested in helping to improve the South Korea–Japan relationship, preferring to take a “wait and see” approach. In previous years, US involvement played an important role in keeping the South Korea–Japan relationship from falling apart, but it no longer holds the two countries’ relations in check. In addition, as the United States tries to shift costs to its allies, it has irritated both Japan and South Korea, limiting its influence on both. As Japan and South Korea have come to doubt whether they can rely on the United States, they have begun to seek more autonomous foreign policies. The cracks that are emerging in US alliance relations with both Japan and South Korea are therefore negatively impacting South Korea–Japan relations.

Finally, Japan and South Korea hold increasingly conflicting roles in the regional structure. During the Cold War, the two countries’ shared interests in modernizing South Korea and opposing communism and North Korea provided a strong basis for their cooperation. However, since the Cold War, latent disputes over history and territory have reemerged. Furthermore, as its economic position has strengthened, South Korea has sought a more equal position relative to Japan and greater regional influence. Liu and Wang argue that Japan sees its greatest competition as South Korea, not China.

The escalation of South Korea–Japan tensions will have wide-ranging negative implications. At the bilateral level, the relationship has become far more indeterminate. Both South Korea and Japan are likely to face economic repercussions, and the tensions are likely to spread to other issue areas. Regional integration and cooperation efforts, such as RCEP and the proposed China–Japan–South Korea FTA are continuing for now, but may also suffer as a result of bilateral tensions. Furthermore, in the context of a global backlash against free trade, the trade tensions may further increase global risks and hamper global economic growth.

Looking to the future, however, Liu and Wang identify a number of factors that will determine how the bilateral relationship develops. Neither party is likely to yield on historical issues because of their respective leadership strategies and the role of nationalism in both countries. Nevertheless, the current restrictions are unlikely to develop into a complete trade embargo because doing so would severely damage Japan’s international image, violate its WTO commitments, and weaken its economy. Furthermore, Liu and Wang believe that the United States will intervene if it thinks relations are deteriorating to the point where they could harm the US regional alliance system. Liu and Wang conclude with a call for Japan to abide by its stated commitment to free trade and its obligation to create a constructive regional environment.

Also writing in Xiandai Guoji Guanxi, No. 8, 2019, Li Tingting provides a complementary analysis of the South Korea–Japan trade dispute. Li first offers a detailed explanation of the domestic legal basis for the trade barriers Japan imposed on South Korea during the summer of 2019, when it first announced its intention to remove South Korea from its trade “white list” and then began requiring Japanese exporters of fluorinated polymide, photoresist, and hydrogen fluoride to obtain individual export licenses for each contract (instead of the previous bulk licenses). These trade barriers have drawn international attention because of concerns that they may place added strains on the global economy, given South Korea’s key position in the global semiconductor supply chain, and because they pose yet another test for the global free trade system. Li also argues that Japan’s measures expose a key difference between Japan and South Korea: while South Korea has pursued a two-track policy that emphasizes the pursuit of justice on historical issues while also continuing to develop relations with Japan, Japan has linked historical issues with economic cooperation. Like many observers, Li is highly skeptical of Japanese claims that its new export controls are motivated by security concerns. Instead, she argues that citing security concerns is a loophole that allows Japan to restrict trade through its existing export control system. Nevertheless, she cautions that the trade tensions might nevertheless impact other aspects of the strategic security relationship, including Japan–United States–South Korea trilateral cooperation.

Like Liu and Wang, Li traces the proximate cause of the trade dispute to the court decisions on forced labor (although unlike Liu and Wang, she does not put as much emphasis on South Korea’s retraction of the “comfort women” agreement). Japan has argued that these court decisions amount to violations of international law because of the 1965 treaty, while South Korea’s government has highlighted international legal principles related to women’s and victims’ rights and has refused to intervene, citing the separation of powers. Despite claiming that Japan’s export controls are not related to the forced labor issue, Abe and other officials have cited the court decisions as damaging mutual trust, and have argued that the lack of trust is a reason for imposing these controls. At the domestic level, Japanese sentiment has shifted against South Korea, spurred on in part by conservative media voices. Personal connections between politicians and academics that previously provided an unofficial channel for easing relations have also deteriorated.

Li also agrees with Liu and Wang’s contention that the underlying cause of bilateral tensions is rooted in shifts in the regional order in the post-Cold War context and blames the Trump administration’s unilateral foreign policy approach for both pushing Japan toward a more unyielding position vis-à-vis South Korea and for setting a precedent for using economic measures to achieve political objectives. Li argues that Japan’s decision to adopt firm measures reflects its evaluation of the likely effectiveness, risk, and strategic value of such a policy. Japan perceives the imposition of export controls as highly effective given South Korea’s high degree of economic dependence on Japan for crucial materials. (In the first five months of 2019, South Korea was reliant on Japanese sourcing for 93.7 percent of its fluorinated polymide, 91.9 percent of its photoresist, and 43.9 percent of its hydrogen fluoride, which are essential materials for the manufacturing of organic LEDs used, for example, in Samsung’s smartphone screens and semi-conductors.) Japan also views this policy approach as relatively low-risk. It does not believe the United States is likely to intervene, given the Trump administration’s isolationist posture, while the use of a security rationale to justify export controls allows it to sidestep possible WTO complaints. By asserting Japan’s right to examine export requests, this policy expands the Japanese government’s flexibility over whether or not to allow transactions to occur. Furthermore, Japan sees the policy as highly strategic because of the crucial role of semiconductors in South Korea’s economy, both in their own right and as crucial components for 5G and the Internet of Things.

South Korea has pursued a number of strategies to respond to Japan’s export controls, including seeking talks with Japan, (unsuccessfully) asking Japan to place South Korea back on the white list, removing Japan from its own trade white list, and announcing its decision not to renew the General Security of Military Information Agreement (GSOMIA). (Li anticipated the latter two decisions, which occurred after the article was written.) South Korea has also tried to shore up international support, going to the United States (which has yet to take on a major role), the WTO, and the global investment community. At the same time, South Korea has strengthened its domestic response by diversifying its suppliers, shoring up domestic support, and designating financial resources.

Like Liu and Wang, Li concludes that the divergence in the positions of South Korea and Japan means that the trade dispute is unlikely to improve in the near term. The role of the United States as a potential arbiter remains an open question. South Korea’s response has increased its international support and to some extent mitigated the economic impact of the trade tensions, but it remains vulnerable. Given the importance of semiconductors for many Chinese industries and the potential for South Korea–Japan tensions to impact regional cooperation, policy toward North Korea, and the global economy, Li argues that China should keep a close eye on this bilateral relationship.

India–Vietnam relations

In Guoji Wenti Yanjiu, No. 4, 2019, Shao Jianping examines deepening maritime cooperation between India and Vietnam. Although the two countries have long had friendly relations, their security cooperation did not begin to develop until the Cold War ended. In 1994, for example, the two countries signed a Protocol on Defense Cooperation. Although maritime security cooperation began to develop at the turn of the twenty-first century, it progressed at a steady, but slow rate until 2011, when it became a priority in the bilateral relationship. As China’s relations with countries bordering the Indian Ocean, such as Myanmar, Pakistan, and Sri Lanka, have expanded and the salience of the South China Sea has increased, India and Vietnam have further emphasized their maritime cooperation.

According to Shao, India–Vietnam maritime cooperation has several dimensions. Indian naval visits to Vietnamese ports have increased. Naval cooperation has become more frequent and routinized. Since 2000, India has consistently supported Vietnam’s efforts to enhance its naval strength by providing military equipment and naval personnel training. The two countries have also deepened their cooperation on the exploration and exploitation of underwater oil and gas in the South China Sea, which increasingly touches upon disputed areas of interest to China. South China Sea concerns have become an important part of Modi’s “Act East” policy. Shao charges that India’s lofty rhetoric about protecting freedom of navigation and respect for international law masks its true regional geopolitical objectives.

In Shao’s view, increased India–Vietnam maritime cooperation is driven by three key motivations. First, India wants to limit the expansion of Chinese power and influence in the Indian Ocean. To this end, India has sought close cooperation with ASEAN countries, seeking to play the role of the regional “security provider.” Given Vietnam’s regional political position and its longstanding tensions with China over territorial and maritime claims, Vietnam has gradually become a key target of India’s Act East policy as India seeks to take advantage of a perceived opportunity to expand its maritime power in the South China Sea and develop the so-called “necklace of diamonds.” Furthermore, India has always sought to maintain its exclusive dominance in the Indian Ocean, and seeks closer ties with countries like Vietnam, in addition to the United States, Japan, and Australia, in order to prevent China from dominating the South China Sea, and using this dominance as a springboard for greater influence in the Indian Ocean. Consequently, the desire to balance China is a key motivation in India’s pursuit of stronger maritime cooperation with Vietnam.

Second, Vietnam seeks stronger cooperation with India because it wants India to balance China in the South China Sea. Since the end of the Cold War, Vietnam has developed a foreign policy that centers on balancing among great powers, while seeking diversified, comprehensive relations with various partners. It relies on the strength of great powers to engage in “soft balancing” against China. Since normalization, China–Vietnam relations have maintained an uneasy balance: Vietnam needs Chinese support to ensure its political stability and economic development, but it is always on guard because of the two countries’ historical disputes and conflicting contemporary interests. By contrast, Vietnam and India are not burdened by historical tensions and have obvious shared interests. Vietnam’s desire to deepen its relationship with India is consistent with its general foreign policy approach of diversifying its relations with stronger powers and using these relationships to balance against China. Furthermore, the emergence of the South China Sea issue over the past decade has created a clear set of common interests: Vietnam wants India to help it balance China in the South China Sea, while India hopes that stronger maritime security cooperation with Vietnam will strengthen Indian influence in the western Pacific.

Third, US support for deeper India–Vietnam maritime cooperation and a more significant role for India in the Asia-Pacific has further encouraged these trends. Early in the twenty-first century, the United States encouraged India to increase its sea power and strengthen its coordination with the US navy. During the Obama administration, Hillary Clinton urged India to play a more active role in molding the future regional order in the Asia-Pacific, a step Shao argues India took when it adopted the Act East policy under Modi. The United States also encourages stronger India–Vietnam maritime cooperation because it believes a stronger relationship will strengthen its “Indo-Pacific strategy,” which Shao contends is designed to contain China.

Shao generally believes that India–Vietnam maritime cooperation will continue to develop, while recognizing some important constraints. China’s increasing capacity in the South China Sea and growing influence in the Indian Ocean will continue to push Vietnam and India to enhance their cooperation. India’s great power ambitions provide further impetus for it to seek stronger ties to Vietnam. Furthermore, some analysts argue that Vietnam and India have come to analyze the situation through the prism of their concerns about South China Sea tensions, resulting in more cooperation between the two countries than might otherwise have occurred.

Nevertheless, Shao identifies some important constraints on bilateral cooperation. First, Vietnam seeks to balance among great powers, and is careful not to provoke China. This caution prevents Vietnam from pursuing a naval alliance with India, for example. Vietnam is careful not to give China the impression that it is allying itself with a great power or group of great powers because it fears that doing so would cause China to contain Vietnam. Second, Vietnam’s naval equipment is relatively poor, which limits India–Vietnam joint naval exercises. These exercises generally occur in the waters near Vietnam, but are further limited by the sensitivity of the South China Sea. Naval ship visits are generally unidirectional, from India to Vietnam, because India has the stronger navy. Finally, Shao contends that the inefficiency of the Indian bureaucracy in carrying out policy will hinder progress in India–Vietnam maritime cooperation. Despite ambitious plans, implementation tends to be sluggish, especially when it requires cooperation with foreign countries and interagency coordination.

Shao concludes by considering the implications of India–Vietnam maritime cooperation for the South China Sea dispute, an issue of prominent importance for Chinese analysts. Generally speaking, Shao argues that India and Vietnam seem displeased by China and ASEAN’s recent progress in stabilizing the situation and reiterates that Modi’s Act East policy has increased the salience of the South China Sea in the minds of Indian strategists. India has increasingly highlighted its concerns about the South China Sea in its bilateral relations with countries like the United States, Japan, and Vietnam, and in its discussions with ASEAN. Shao argues that India’s position on the South China Sea is increasingly in line with those of the United States, Australia, and Japan, which share its emphasis on the need for disputants to respect UNCLOS and protect freedom of navigation. Shao contends that India’s frequent visits to Vietnamese ports not far from the Spratly Islands have made the South China Sea more of a sticking point in India–China relations than they previously were, and argues that increased India–Vietnam maritime cooperation in the South China Sea will negatively impact India–China relations and increase the likelihood of friction.

Nevertheless, Shao is not alarmed about the prospects for conflict. Shao argues that despite India’s desire to expand its influence in the western Pacific, its comprehensive power is far less than that of China and that it generally adopts a “soft balancing approach.” India has no desire to begin a direct conflict with China. Furthermore, Shao contends that India’s primary strategic interest lies in the Indian Ocean, not the South China Sea. Consequently, Shao concludes that India has no strategic interest in the eruption of a conflict with China in the South China Sea.

Community of common destiny

In Taipingyang Xuebao, No. 8, 2019, Gao Wanglai evaluates how the “community of a shared future for mankind,” more often translated as the “community of common destiny” (CCD), has been interpreted by American academics, policy practitioners, and think tank researchers. (Although Gao identifies these interpretations as American perceptions, strictly speaking a few of the researchers the article cites are not actually American, even if all are either affiliated with American institutions or have contributed work that is widely read in American academic circles.) This article provides a useful Chinese critique of how American researchers have attempted to understand this Chinese concept since 2013.

Focusing first on the general interpretation of this concept among American China-watchers, Gao identifies four basic understandings: First, researchers identify CCD as a core concept in the current era of Chinese diplomacy. Second, they view this concept as closely related to China’s growing strength, which is causing China to rethink its international position and adjust its foreign policy. Third, they believe that CCD reflects Chinese demands for a new international order, though they differ in whether they see these as helpful calls for beneficial reforms or a challenge to US hegemony. Finally, these researchers view China as implementing the CCD concept in its peripheral diplomacy, in its efforts to create an economic community, and in its measures to improve global governance. Overall, Gao applauds American observers for their nuanced understanding and deep attentiveness to the importance of this concept.

Despite these commonalities, Gao argues that researchers take markedly different views of CCD based on whether they approach relations with China from a perspective that emphasizes realist principles, liberal principles, or the concept of a security community. Those adopting a realist approach, which Gao identifies as the main perspective, emphasize the need to guard against a Chinese threat to US hegemony. They ask how China will translate its growing strength into greater international influence and worry that China’s rise will lead it to challenge the existing US-led international order. They tend to be pessimistic about China–US relations, and some argue that the United States needs to put increased pressure on China to mitigate its challenge to US strategic superiority in Asia. By contrast, those adopting a liberal view do not worry that China’s rise will cause it to challenge the global order. Instead, they argue that the diplomatic practices that embody CCD are beneficial for promoting global governance, and that the United States should welcome China’s constructive role in the international system. Finally, those who start from the concept of a security community typically argue that China is forming a security community through its diplomatic practices. They argue that the diplomatic practices underlying CCD are helping to create a new form of international relations, and that China plays a key role in creating a regional community.

Gao next tries to understand why American researchers hold such different views on CCD. Gao notes that US analysis of China tends to center on the change in the relative power of China and the United States, and the implications for the world order. In particular, researchers tend to be quite concerned with “US decline” and the future of the liberal world order. They also try to understand whether China is trying to replace the United States as the world’s leading state, how China might mold or alter the existing world order, and whether China’s policies are likely to result in upheaval.

In addition, Gao argues that American researchers are starting to recognize more fully the positive implications of CCD because of greater China–US cooperation at the bilateral, regional, and global levels. This recognition, in Gao’s view, has caused many academics to move beyond zero-sum, power politics-based analyses of the bilateral relationship. Reflecting her own position on CCD, Gao asserts that these researchers “objectively” point out that China’s rising power does not mean that it will challenge the current world order and argue that the United States should welcome CCD as evidence of China’s determination to play a constructive, beneficial international role. Reflecting on why other observers hold negative views of CCD, Gao argues that these negative views reflect strategic anxiety about China. Furthermore, intensifying strategic competition between the two countries has caused some US academics to advocate a tougher policy toward China, particularly in light of the ongoing trade war.

Gao concludes with recommendations for a Chinese policy response. Overall, she is pleased with the extent to which the CCD concept has spread among American researchers, but she still urges the Chinese to push Americans to study this concept more fully. Gao argues that China needs to have a strong “discursive foreign policy” strategy to embed CCD and related concepts more fully in the American consciousness. Such a strategy would include public diplomacy efforts targeting elites and the general public through cultural publications, “emotionally evocative” movies, and party histories in order to help them better understand the implications of “political discourse with Chinese characteristics” (one might be more than a bit skeptical about how susceptible seasoned American observers would be to these types of efforts, particularly efforts to frame party history in ways that the government prefers).

Gao also urges China to effectively use Track 2 diplomacy, involving academics, retired officials, and business executives, and other non-official mechanisms that enhance people-to-people connections to deepen communication with the United States. To this end, China should promote dialogues among think tanks, NGOs, and other community-based organizations. She also recommends that China train Chinese academics and overseas Chinese to act as emissaries who can help to build China’s soft power and create a positive environment for Chinese diplomacy.

Gao further advises that China focus on fixing what she sees as three major misunderstandings about CCD. First, Gao is highly critical of Americans observers who use power politics to analyze Chinese diplomacy and who focus on how greater Chinese diplomatic influence might challenge US hegemony. Second, she cautions against viewing CCD as only an economic policy, rather than a multidimensional concept. Finally, she criticizes those who do not recognize China’s constructive global role, arguing that this has already been acknowledged by people in many other countries. Although Gao does not believe that most US academics are biased toward China or harbor malicious intent, she does believe that their lack of a nuanced understanding of China and this concept results in these mistakes. Still, she is optimistic that they may come to revise their negative views.

Finally, Gao urges China to continue to seek new avenues for China–US cooperation. A key aspect of CCD, in her view, is developing a framework that enables great power relations to develop in a stable manner. This will require the two countries to bridge big gaps in their historical and cultural experiences and in their social systems. She is optimistic about the prospects for such cooperation, pointing to ever tighter economic integration, the potential for greater coordination on climate change and energy issues, and joint efforts to enhance international nuclear safety training. She urges the two countries to start with global governance issues that interest them both and use this as a platform to construct bilateral and multilateral dialogue mechanisms and new models for cooperation.

#Act East Policy #comfort women #community of common destiny #GSOMIA #US-China trade war