U.S.–China Week: AIIB, missile defense, SCS, Wang Qishan (2015.03.23)

U.S.–China Week returns today after week off, and there was no shortage of news while I was away, so let’s get to it.

As always: Your comments or quibbles are very much appreciated. Encourage your friends to subscribe to the list. And follow me on Twitter at @gwbstr.

AIIB
U.S. attempt to undermine China-backed infrastructure bank crumbles spectacularly

First off, CFR has the best simple explanation of what’s going on. A recap: An unnamed U.S. official called out the UK government for “constant accommodation” of China after it decided to join the China-backed Asian Infrastructure Investment Bank (AIIB), despite strong U.S. advocacy against advanced economies joining up. Germany, France, and Italy soon followed; and Australia and Japan may be next. A Xinhua writer took to mocking a “petulant and cynical” Washington. Xinhua runs plenty of mockery, but former U.S. official and World Bank President Robert Zoellick seemed to partially agree, calling the Obama administration approach“mistaken both on policy and on execution.”

ANALYSIS: Expert consensus has been unusually strong that the U.S. effort to prevent G7 economies from joining AIIB was wrongheaded. It is intuitively clear that the United States couldn’t join, since Congress would have to allocate funds, but the Obama administration chose to exert real pressure on others to follow suit. In reality, this is an example of a strategically unwise instinct in Washington to oppose every aspect of Chinese influence, expending resources and diplomatic capital on losing battles or potentially minor issues. U.S. government objections reportedly boiled down to fears of low environmental or corruption standards if China writes the rules, a justification that has been unconvincing domestically and abroad.

NORTH KOREA
China opposes U.S. anti-missile technnology in South Korea

A possible plan by the U.S. and South Korean governments to deploy an advanced missile defense capability in South Korea has produced opposition from China andconsiderable friction between the East Asian neighbors. NYT reports: “Although Washington has insisted that such a deployment would be aimed solely at dealing with threats from North Korea, China worries that the system would help the United States military extend its radar sensor capabilities deeper into its territory and compromise its own strategic deterrent.” U.S. Assistant Secretary of State Danny Russel chose to poke fun at China’s objection: “I find it curious that a third country would presume to make strong representations about a security system that has not been put in place and that is still a matter of theory.”

ANALYSIS: This represents an apparent break from the past, in which China’s government broadly accepted the U.S. claim that its missile defenses in the region were targeted at North Korean capabilities. China’s own nuclear deterrent was not affected, so nuclear strategists did not see cause for alarm. It seems unlikely that one new deployment would change that equation, but resistance to U.S. monitoring is strong, as we have seen in the ongoing dispute over what Chinese representatives call “close-in surveillance” in the South China Sea.

SOUTH CHINA SEA
Admiral: U.S. Navy would support a joint ASEAN maritime patrol

“During a meeting this week with naval leaders from Association of South East Asian Nations (ASEAN) U.S. 7th Fleet commander Vice Adm. Robert Thomas said the U.S. would back a combined ASEAN maritime patrol in the hotly contested region. …’If Asean members were to take the lead in organizing something along those lines, trust me, the U.S. 7th Fleet would be ready to support.'” [source] Chinese reaction was predictably negative, just as it was in January, when the same admiral welcomed Japanese air patrols in the area.

ANALYSIS: This comment, which was better hedged than media headlines would have us believe, comes at a time when the U.S. security and political community are increasingly engaged in the South China Sea issue. The chairs and ranking members of the Senate Armed Services and Foreign Affairs committees sent a letter to Defense Secretary Ash Carter and Secretary of State John Kerry pushing for a “comprehensive strategy for addressing the PRC’s broader policy and conduct” in the area. The U.S. position that it does not take sides is increasingly untenable, not least because the Chinese government declined to freeze land reclamation, putting the governments explicitly at odds.

CORRUPTION
Report: Anti-graft chief Wang Qishan to visit U.S., chase Chinese fugitives

“The people familiar with Mr Wang’s trip said preparations had not yet been finalised. It would be his first overseas visit in his capacity as [CCP Central Commission for Discipline Inspection] chief, according to a chronology of leadership trips compiled by the official Xinhua news agency,” FT reports. “Mr Wang no longer has a government title, raising awkward protocol questions about which US government official would formally host him.”

ANALYSIS: The Chinese government has firmly asked for U.S. assistance in tracking down and turning over people, especially officials, it claims have fled to the United States with illegally obtained wealth. These requests are a challenge for the U.S. government, which must balance due process and human rights concerns against substantial evidence of criminality. It may be an opportunity for leverage as well: The U.S. government seeks enforcement of its cyber theft laws in China, and China wants enforcement of its own laws in the United States. Such cooperation could even be linked to issues like the possible delay of a Chinese law that U.S. tech firms fear would hurt business.

SOCIAL TRENDS
Interest in Chinese language, study abroad, and jobs down among U.S. students

Reuters reports on several indications that U.S. students are less drawn to China for study abroad, language study, or work after graduation: “The Institute of International Education says the number of U.S. students studying in China fell 3.2 percent in 2012-13 to 14,413, even as overall study abroad numbers rose modestly. … As multinationals in China hire mostly local Chinese, a growing percentage of whom have studied abroad, they have less need for foreigners who speak Chinese.”

ANALYSIS: A true decline in interest in China, while the domestic commentary on China bends toward caricature, would be extremely worrisome. But comparisons in the statistics to 2007, the year before the Beijing Olympics, probably capture an unusual spike in interest—and the cohort who started Chinese in high school at that time are finishing college now. The United States needs more people with serious China experience, but the barriers to getting that experience have, in my unscientific impression, risen. This also means the young U.S. expats in China are generally better prepared than earlier groups, not an altogether bad outcome.

ABOUT U.S.–CHINA WEEK

U.S.–China Week is a weekly news and analysis brief covering the most important news developments and their implications in U.S.–China relations and highlighting especially insightful or influential new policy analysis. It is produced by me, Graham Webster, a senior fellow for U.S.–China relations at Yale Law School’s China Center. Opinions expressed here are my own (and I reserve the right to change my mind). Subscription to U.S.–China Week is free and open to all, and an archive of past editions appears at my long-running website on U.S.–East Asia politics, Transpacifica.

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