U.S.–China Week Issue 2: Abe in U.S., cyber strategy, realism vs. reality, and investment moves (2015.04.27)

Much of the action in U.S.–China relations this week comes in connection to the ongoing U.S. visit by Japanese Prime Minister Shinzo Abe, during which the United States and Japan have already released new defense guidelines (joint statement; full text) and Abe is expected to address a joint session of Congress. From military affairs to trade negotiations and Abe’s stance on history, this is an excellent reminder that no international relationship is exclusively bilateral—least of all the one between China and the United States.

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TRIANGULAR TIES
Pomp and pragmatism as Abe visits U.S.: Nerves over history as alliance retools for China’s rise and global security

If Japanese Prime Minister Shinzo Abe read the U.S. press before arriving Sunday, he might have expected a cool welcome. In a typical statement, a NYT editorialdeclared, “the success of the visit also depends on whether and how honestly Mr. Abe confronts Japan’s wartime history.” FT writes: “Washington should not back him under all circumstances. That is especially true when it comes to relations with China.” Abe met Chinese President Xi Jinping Wednesday, perhaps signaling a fragile “new positivity,” and Chinese reactions to the new U.S.–Japan defense guidelines are yet to emerge. (Adam Liff has written an excellent background brief on the guidelines.)

ANALYSIS: U.S. wariness of Abe is not just about history. Long before the Obama team went to battle with Congress over the Trans-Pacific Partnership, they started a tough negotiation with Japan. Many U.S. policymakers support Abe, though, because he is willing to move Japan toward sharing more of the regional security burden. Both governments need to manage their actions and statements to live up to the ideal of a stability-promoting alliance. Real stability would necessarily involve understanding and cooperation among China, Japan, and the United States.

SOUTH CHINA SEA
ASEAN warns island building ‘may undermine peace’; Japan law may allow it to supply U.S. ships in the region

AFP reports that a statement from an Association of Southeast Asian Nations (ASEAN) summit will avoid mentioning China while declaring: “We share the serious concerns expressed by some leaders on the land reclamation being undertaken in the South China Sea (SCS), which has eroded trust and confidence and may undermine peace, security and stability.” // Meanwhile Reuters reports that a legislative process under way in Japan may lift restrictions on Japan’s military activities, allowing it to resupply U.S. forces anywhere, “should Tokyo judge its national security to be at stake.”

ANALYSIS: The ASEAN statement (under chair Malaysia) is a rare direct jab at specific Chinese actions. Even though China was not named, and other states have engaged in land reclamation in the area, China is behind most or all current efforts and is the clear target here. // As time passes, expect Japan to play a greater role in regional security. Extreme steps such as Japanese patrols in what China describes as its exclusive economic zone (EEZ), however, would be white-hot and would expose the United States to considerable risk. U.S. forces nonetheless clearly intend to remain present in the SCS and are seeking renewed access to Philippine bases.

BILATERAL INVESTMENT
China opens a few more sectors, introduces national security rules in free trade zones

Chinese authorities cut the “negative list” of areas closed to foreign investment from 139 to 122 in the country’s four pilot free trade zones (FTZs). The list, which still restricts investment in numerous major industries, is a potential precursor to a similar list in negotiations for a U.S.–China bilateral investment treaty (BIT). At the same time, authorities introduced a new national security review for inbound investment in the FTZs, prompting comparisons to the U.S. CFIUS system. That system might have been the target of Chinese Finance Minister Lou Jiwei’s reported remark that he was “uncomfortable” with a U.S. negative list. (There is reason to believe that statement was distorted or inaccurately reported.)

ANALYSIS: The current FTZ “negative list” is nowhere near as short as what the United States would want in a BIT, and ambiguities about the process and scope of security reviews may be a hurdle. But in a negative list system, where investment is open unless specifically restricted, it makes sense to build a method to detect unanticipated security risks.

CYBERSECURITY
U.S. publishes new ‘cyber strategy,’ emphasizing deterrence and retaliation potential

U.S. Defense Secretary Ash Carter announced a new U.S. “cyber strategy” with significant implications for China. The strategy names China alongside Russia, Iran, and North Korea under “key cyber threats” and redoubles the U.S. government emphasis on intellectual property theft. It asserts that the U.S. indictment of five Chinese military members was partially meant “to deter China from conducting future cyber espionage.” In all, the document stresses resilience and the potential use of cyberweapons for retaliation while, argues Greg Austin, underplaying the strategic and diplomatic challenge of computer-based weaponry.

ANALYSIS: U.S. and Chinese defense officials each have access to significant tools to disrupt computer systems in ways that pose a threat to military and civilian life. For bilateral strategic stability, these governments need a way to understand and reduce the risks of misattribution and escalation in a cybersecurity emergency. Deterrence would be a part of this, but much more needs to be done and little progress is evident.

REALISM VS. REALITY
Swaine makes pragmatic case for a move away from U.S. predominance in the Asia-Pacific

Responding to Andrew Krepinevich’s case for generally encircling China with allied forces, discussed here in February, Michael Swaine writes in Foreign Affairs: “Chinese leaders today are not trying to carve out an exclusionary sphere of influence, especially in hard-power terms; they are trying to reduce their considerable vulnerability and increase their political, diplomatic, and economic leverage in their own backyard. … [This] does not necessarily threaten vital U.S. or allied interests, and it can and should be met with understanding rather than defensive aggressiveness.” He also writes: “Trying to sustain [U.S.] predominance, therefore, is actually the quickest route to instability.”

ANALYSIS: Swaine outlines the strategic reality implied by China’s growing capabilities and limited U.S. resources. It’s a long essay, but one key point is critical: “It is inconceivable that Beijing will accept U.S. predominance in perpetuity and that it will grant the United States complete freedom of action in the Pacific and recognize its ability to prevail militarily in a potential conflict.”

ABOUT U.S.–CHINA WEEK

U.S.–China Week is a weekly news and analysis brief that covers important developments in U.S.–China relations and features especially insightful or influential new policy analysis.

Graham Webster is a research scholar and senior fellow at Yale Law School’s China Center, where he focuses on U.S.–China diplomatic, security, and economic relations through research and Track II dialogues. A full bio is available here.

Disclaimer: Opinions expressed here are my own (and I reserve the right to change my mind).

Subscription to U.S.–China Week by clicking here or e-mailing me 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.

Contact: Follow me on Twitter at @gwbstr. Send e-mail to [email protected].

2 thoughts on “U.S.–China Week Issue 2: Abe in U.S., cyber strategy, realism vs. reality, and investment moves (2015.04.27)

  1. Pingback: U.S.–China Week Issue 3: Big trade speech, China’s Defense Ministry speaks, bribery and business, South China Sea jockeying (2015.05.04) | Transpacifica

  2. Pingback: U.S.–China Week: Hacking hysteria, reality in the South China Sea, Medeiros moves on, BIT progress in question (Issue 8, 2015.06.08) | Transpacifica

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