Taiwan Communiqué No. 88, November 1999

Medium Kingdom China

Gerald Segal: The myth of Chinese power

"Does China matter?" is the question posed by Dr. Gerald Segal, director at the International Institute for Strategic Studies in London in the September / October 1999 issue of Foreign Affairs. He argues that, economically, China is a relatively unimportant small market; militarily, it is less a global rival like the Soviet Union than a regional menace like Iraq; and politically, its influence is puny. The Middle Kingdom is a middle power. China matters far less than it and most of the West think, and it is high time the West began treating it as such.

He says that China has mastered the art of "diplomatic theater", which has us willingly suspending our disbelief in its strength. In fact, China under President Jiang Zemin is better understood as a theatrical power. He argues that after 50 years of Mao's revolution and 20 years of reform, it is time to leave the theater and see China for what it is.

Dr. Segal calculates that in terms of its share of world GNP, per capita GDP or almost any other economic indicator, China is only a medium or even a small performer. He argues that its growth rates are usually inflated to the extent that even Chinese Prime Minister Zhu Rongji distrusts them. Taking all these qualifications into account, China's economy is effectively in recession.

In terms of international trade and investment, the story is much the same: China is a seriously overrated power. China made up a mere 3 percent of total world trade in 1997, about the same as South Korea and less than the Netherlands. China now accounts for only 11 percent of total Asian trade. Despite the hype about the importance of the Chinese market, exports to China are tiny. Only 1.8 percent of U.S. exports go to China (this could, generously, be perhaps 2.4 percent if re-exports through Hong Kong were counted) — about the same level as U.S. exports to Australia or Belgium and about a third less than U.S. exports to Taiwan.

China is also a second-rate military power — not first rate, because it is far from capable of taking on America, but not third rate, as are most of its Asian neighbors. China accounts for only 4.5 percent of global defense spending (the United States makes up 33.9 percent) and 25.8 percent of defense spending in East Asia and Australasia. China poses a formidable threat to the likes of the mighty Philippines. China is in no military shape to take the disputed Senkaku Islands from Japan, which is decently armed. Beijing clearly is a serious menace to Taiwan, but even this most acute security concern on China's front door cannot be resolved by China because the United States stands in its way. Not much of a great power!

Dr. Segal states that because China challenges Western authority, it matters to some extent. But it does not matter so much that it can't be constrained. But the fact that a country can directly threaten the United States is certainly not a reason to pretend that China is a strategic partner — in fact, the United States and China have no important common strategic interests.

Dr. Segal's conclusion: Any way you look at it, China matters far less than people think; and as a result the 50th anniversary was nothing to celebrate. The true time for celebration will come when China has engaged in thorough political reforms and genuinely gives its people the ability to stand up tall in the world.

William Pfaff: Overrating China

In his article "Let's overcome an old American habit of overrating China" in the International Herald Tribune (9 October 1999), political commentator William Pfaff comes to similar conclusions as Gerald Segal. Using new information from an upcoming documentary, titled "Playing the China Card", Mr. Pfaff argues that Messrs. Nixon and Kissinger conducted themselves as "tribute bearers" to the Chinese Imperial Court, and that the U.S. received little in return for their generous gifts to China.

Mr. Pfaff then shows how this "strange pattern of unsolicited U.S. diplomatic gifts" _ pressed upon the Chinese despite their failure to reciprocate _ continued under the Bush and Clinton Administrations. He says that Mr. Clinton's "strategic partnership" with China has weakened American relations with Japan.

He also emphasizes that Taiwan today is not only a democracy but an economic and trading power of greater international importance than China itself, and that Mr. Clinton's proclaimed "one-China policy" seems to endorse China's claim to Taiwan on Beijing's terms. He argues that the US should stop holding the illusion about China that says "size plus population equals power."

Harvey Feldman: US policy counter to US interests

In a well-written essay published in Taiwan Perspective, a publication of the Taiwan Research Institute, former Ambassador Harvey Feldman — who served on the State Department task force that helped draft the Taiwan Relations Act of 1979 _ laid out a critical view of the present US policy towards Taiwan and China.

He states that the "Clintonian engagement policy" of the U.S. Administration, gives far too much weight to China, and is overly attuned to Beijing's sensitivities. He says that this central focus on Beijing is wrong, since it is incorrect to assume that Washington somehow can manage China's emergence on the world stage. He also faults the Administration for its "pre-emptive concessions" to China, and _ in the process _ severely damaging America's long-term interest in promoting democracy and free-market economics in the region.

He writes that this "Clinton-Kissinger construct" ignores that China remains a one-party dictatorship in which the Communist Party has exclusive franchise, and any other grouping is crushed, and that the famous China market remains more myth than reality. He says that American exports to China are about equivalent to what the US exports to tiny Singapore. US exports to Taiwan are much higher, amounting to the highest purchases of American goods per capita than any population other than Canada's.

Ambassador Feldman also emphasizes that China maintains a vast internal empire of subject peoples — Tibetans, Uighurs and other Turkic peoples, and Mongols _ and that the resulting instability creates a need for constant repression. He argues that China's pledges on non-proliferation, human rights, and protection of intellectual property are noteworthy for the ease with which Beijing breaks them and the willingness of the Clinton administration to turn a blind eye.

Mr. Feldman argues that China is neither our ally nor necessarily our enemy, but follows its own view of its interests. As long as it remains a communist dictatorship, those interests, international and domestic, often will be antithetical to our own. He concludes that we should go back to basics, understanding that Japan and South Korea are democracies, and are essential to our security posture.

He emphasizes that Taiwan too is a democracy, and both its government and its people share our values of rule of law, political inclusiveness, human rights and personal freedoms, including free economic institutions. We should understand as well that assisting Taiwan's democracy, preserving the right of its 22 million people to determine their future free of coercion or repression, remains very much in America's long-term interest.

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