hedging Sinophobia

[Autoplectic <autoplectic@xxxxxxxxx>]

<http://www.state.gov/s/d/rem/53682.htm>

Whither China: From Membership to Responsibility?

Robert B. Zoellick, Deputy Secretary of State
Remarks to National Committee on U.S.-China Relations
New York City
September 21, 2005

As Prepared for Delivery

Earlier this year, I had the pleasure of making the acquaintance of
Mr. Zheng Bijian, Chair of the China Reform Forum, who over some
decades has been a counselor to China's leaders. We have spent many
hours in Beijing and Washington discussing China's course of
development and Sino-American relations. It has been my good fortune
to get to know such a thoughtful man who has helped influence, through
the Central Party School, the outlook of many officials during a time
of tremendous change for China.

This month, in anticipation of President Hu's visit to the United
States, Mr. Zheng published the lead article in Foreign Affairs,
"China's 'Peaceful Rise' to Great Power Status." This evening, I would
like to give you a sense of the current dialogue between the United
States and China by sharing my perspective.

Some 27 years ago, Chinese leaders took a hard look at their country
and didn't like what they saw. China was just emerging from the
Cultural Revolution. It was desperately poor, deliberately isolated
from the world economy, and opposed to nearly every international
institution. Under Deng Xiaoping, as Mr. Zheng explains, China's
leaders reversed course and decided "to embrace globalization rather
than detach themselves from it."

Seven U.S. presidents of both parties recognized this strategic shift
and worked to integrate China as a full member of the international
system. Since 1978, the United States has also encouraged China's
economic development through market reforms.

Our policy has succeeded remarkably well: the dragon emerged and
joined the world. Today, from the United Nations to the World Trade
Organization, from agreements on ozone depletion to pacts on nuclear
weapons, China is a player at the table.

And China has experienced exceptional economic growth. Whether in
commodities, clothing, computers, or capital markets, China's presence
is felt every day.

China is big, it is growing, and it will influence the world in the years ahead.

For the United States and the world, the essential question is – how
will China use its influence?

To answer that question, it is time to take our policy beyond opening
doors to China's membership into the international system: We need to
urge China to become a responsible stakeholder in that system.

China has a responsibility to strengthen the international system that
has enabled its success. In doing so, China could achieve the
objective identified by Mr. Zheng: "to transcend the traditional ways
for great powers to emerge."

As Secretary Rice has stated, the United States welcomes a confident,
peaceful, and prosperous China, one that appreciates that its growth
and development depends on constructive connections with the rest of
the world. Indeed, we hope to intensify work with a China that not
only adjusts to the international rules developed over the last
century, but also joins us and others to address the challenges of the
new century.

From China's perspective, it would seem that its national interest
would be much better served by working with us to shape the future
international system.

If it isn't clear why the United States should suggest a cooperative
relationship with China, consider the alternatives. Picture the wide
range of global challenges we face in the years ahead – terrorism and
extremists exploiting Islam, the proliferation of weapons of mass
destruction, poverty, disease – and ask whether it would be easier or
harder to handle those problems if the United States and China were
cooperating or at odds.

For fifty years, our policy was to fence in the Soviet Union while its
own internal contradictions undermined it. For thirty years, our
policy has been to draw out the People's Republic of China. As a
result, the China of today is simply not the Soviet Union of the late
1940s:

# It does not seek to spread radical, anti-American ideologies.
# While not yet democratic, it does not see itself in a twilight
conflict against democracy around the globe.
# While at times mercantilist, it does not see itself in a death
struggle with capitalism.
# And most importantly, China does not believe that its future depends
on overturning the fundamental order of the international system. In
fact, quite the reverse: Chinese leaders have decided that their
success depends on being networked with the modern world.

If the Cold War analogy does not apply, neither does the distant
balance-of-power politics of 19th Century Europe. The global economy
of the 21st Century is a tightly woven fabric. We are too
interconnected to try to hold China at arm's length, hoping to promote
other powers in Asia at its expense. Nor would the other powers hold
China at bay, initiating and terminating ties based on an old model of
drawing-room diplomacy. The United States seeks constructive relations
with all countries that do not threaten peace and security.

So if the templates of the past do not fit, how should we view China
at the dawn of the 21st Century?

On both sides, there is a gulf in perceptions. The overwhelming
priority of China's senior officials is to develop and modernize a
China that still faces enormous internal challenges. While proud of
their accomplishments, China's leaders recognize their country's
perceived weaknesses, its rural poverty, and the challenges of
political and social change. Two-thirds of China's population – nearly
900 million people – are in poor rural areas, living mostly as
subsistence farmers, and 200 million Chinese live on less than a
dollar a day. In China, economic growth is seen as an internal
imperative, not as a challenge to the United States.

Therefore, China clearly needs a benign international environment for
its work at home. Of course, the Chinese expect to be treated with
respect and will want to have their views and interests recognized.
But China does not want a conflict with the United States.

Nevertheless, many Americans worry that the Chinese dragon will prove
to be a fire-breather. There is a cauldron of anxiety about China.

The U.S. business community, which in the 1990s saw China as a land of
opportunity, now has a more mixed assessment. Smaller companies worry
about Chinese competition, rampant piracy, counterfeiting, and
currency manipulation. Even larger U.S. businesses – once the backbone
of support for economic engagement – are concerned that mercantilist
Chinese policies will try to direct controlled markets instead of
opening competitive markets. American workers wonder if they can
compete.

China needs to recognize how its actions are perceived by others.
China's involvement with troublesome states indicates at best a
blindness to consequences and at worst something more ominous. China's
actions – combined with a lack of transparency – can create risks.
Uncertainties about how China will use its power will lead the United
States – and others as well – to hedge relations with China. Many
countries hope China will pursue a "Peaceful Rise," but none will bet
their future on it.

For example, China's rapid military modernization and increases in
capabilities raise questions about the purposes of this buildup and
China's lack of transparency. The recent report by the U.S. Department
of Defense on China's military posture was not confrontational,
although China's reaction to it was. The U.S. report described facts,
including what we know about China's military, and discussed
alternative scenarios. If China wants to lessen anxieties, it should
openly explain its defense spending, intentions, doctrine, and
military exercises.

Views about China are also shaped by its growing economic footprint.
China has gained much from its membership in an open, rules-based
international economic system, and the U.S. market is particularly
important for China's development strategy. Many gain from this trade,
including millions of U.S. farmers and workers who produce the
commodities, components, and capital goods that China is so
voraciously consuming.

But no other country – certainly not those of the European Union or
Japan – would accept a $162 billion bilateral trade deficit,
contributing to a $665 billion global current account deficit. China –
and others that sell to China – cannot take its access to the U.S.
market for granted. Protectionist pressures are growing.

China has been more open than many developing countries, but there are
increasing signs of mercantilism, with policies that seek to direct
markets rather than opening them. The United States will not be able
to sustain an open international economic system – or domestic U.S.
support for such a system – without greater cooperation from China, as
a stakeholder that shares responsibility on international economic
issues.

For example, a responsible major global player shouldn't tolerate
rampant theft of intellectual property and counterfeiting, both of
which strike at the heart of America's knowledge economy. China's
pledges – including a statement just last week by President Hu in New
York – to crack down on the criminals who ply this trade are welcome,
but the results are not yet evident. China needs to fully live up to
its commitments to markets where America has a strong competitive
advantage, such as in services, agriculture, and certain manufactured
goods. And while China's exchange rate policy offered stability in the
past, times have changed. China may have a global current account
surplus this year of nearly $150 billion, among the highest in the
world. This suggests that China's recent policy adjustments are an
initial step, but much more remains to be done to permit markets to
adjust to imbalances. China also shares a strong interest with the
United States in negotiating a successful WTO Doha agreement that
opens markets and expands global growth.

China's economic growth is driving its thirst for energy. In response,
China is acting as if it can somehow "lock up" energy supplies around
the world. This is not a sensible path to achieving energy security.
Moreover, a mercantilist strategy leads to partnerships with regimes
that hurt China's reputation and lead others to question its
intentions. In contrast, market strategies can lessen volatility,
instability, and hoarding. China should work with the United States
and others to develop diverse sources of energy, including through
clean coal technology, nuclear, renewables, hydrogen, and biofuels.
Our new Asia Pacific Partnership on Clean Development and Climate – as
well as the bilateral dialogue conducted by the U.S. Department of
Energy and China's National Development and Reform Commission – offer
practical mechanisms for this cooperation. We should also encourage
the opening of oil and gas production in more places around the world.
We can work on energy conservation and efficiency, including through
standards for the many appliances made in China. Through the IEA we
can strengthen the building and management of strategic reserves. We
also have a common interest in secure transport routes and security in
producing countries.

All nations conduct diplomacy to promote their national interests.
Responsible stakeholders go further: They recognize that the
international system sustains their peaceful prosperity, so they work
to sustain that system. In its foreign policy, China has many
opportunities to be a responsible stakeholder.

The most pressing opportunity is North Korea. Since hosting the
Six-Party Talks at their inception in 2003, China has played a
constructive role. This week we achieved a Joint Statement of
Principles, with an agreement on the goal of "verifiable
denuclearization of the Korean peninsula in a peaceful manner." But
the hard work of implementation lies ahead, and China should share our
interest in effective and comprehensive compliance.

Moreover, the North Korea problem is about more than just the spread
of dangerous weapons. Without broad economic and political reform,
North Korea poses a threat to itself and others. It is time to move
beyond the half century-old armistice on the Korean peninsula to a
true peace, with regional security and development. A Korean peninsula
without nuclear weapons opens the door to this future. Some 30 years
ago America ended its war in Viet Nam. Today Viet Nam looks to the
United States to help integrate it into the world market economic
system so Viet Nam can improve the lives of its people. By contrast,
North Korea, with a 50 year-old cold armistice, just falls further
behind.

Beijing also has a strong interest in working with us to halt the
proliferation of weapons of mass destruction and missiles that can
deliver them. The proliferation of danger will undermine the benign
security environment and healthy international economy that China
needs for its development.

China's actions on Iran's nuclear program will reveal the seriousness
of China's commitment to non-proliferation. And while we welcome
China's efforts to police its own behavior through new export controls
on sensitive technology, we still need to see tough legal punishments
for violators.

China and the United States can do more together in the global fight
against terrorism. Chinese citizens have been victims of terror
attacks in Pakistan and Afghanistan. China can help destroy the supply
lines of global terrorism. We have made a good start by working
together at the UN and searching for terrorist money in Chinese banks,
but can expand our cooperation further.

China pledged $150 million in assistance to Afghanistan, and $25
million to Iraq. These pledges were welcome, and we look forward to
their full implementation. China would build stronger ties with both
through follow-on pledges. Other countries are assisting the new Iraqi
government with major debt forgiveness, focusing attention on the $7
billion in Iraqi debt still held by Chinese state companies.

On my early morning runs in Khartoum, I saw Chinese doing tai chi
exercises. I suspect they were in Sudan for the oil business. But
China should take more than oil from Sudan – it should take some
responsibility for resolving Sudan's human crisis. It could work with
the United States, the UN, and others to support the African Union's
peacekeeping mission, to provide humanitarian relief to Darfur, and to
promote a solution to Sudan's conflicts.

In Asia, China is already playing a larger role. The United States
respects China's interests in the region, and recognizes the useful
role of multilateral diplomacy in Asia. But concerns will grow if
China seeks to maneuver toward a predominance of power. Instead, we
should work together with ASEAN, Japan, Australia, and others for
regional security and prosperity through the ASEAN Regional Forum and
the Asia Pacific Economic Cooperation forum.

China's choices about Taiwan will send an important message, too. We
have made clear that our "one China" policy remains based on the three
communiqués and the Taiwan Relations Act. It is important for China to
resolve its differences with Taiwan peacefully.

The United States, Japan, and China will need to cooperate effectively
together on both regional and global challenges. Given China's
terrible losses in World War II, I appreciate the sensitivity of
historical issues with Japan. But as I have told my Chinese
colleagues, I have observed some sizeable gaps in China's telling of
history, too. When I visited the "918" museum at the site of the 1931
"Manchurian Incident," I noted that the chronological account jumped
from 1941 to the Soviet offensive against Japan in August 1945,
overlooking the United States involvement in the Pacific from 1941 to
1945! Perhaps we could start to ease some misapprehensions by opening
a three-way dialogue among historians.

Clearly, there are many common interests and opportunities for
cooperation. But some say America's commitment to democracy will
preclude long-term cooperation with China. Let me suggest why this
need not be so.

Freedom lies at the heart of what America is… as a nation, we stand
for what President Bush calls the non-negotiable demands of human
dignity. As I have seen over the 25 years since I lived in Hong Kong,
Asians have also pressed for more freedom and built many more
democracies. Indeed, President Hu and Premier Wen are talking about
the importance of China strengthening the rule of law and developing
democratic institutions.

We do not urge the cause of freedom to weaken China. To the contrary,
President Bush has stressed that the terrible experience of 9/11 has
driven home that in the absence of freedom, unhealthy societies will
breed deadly cancers. In his Second Inaugural, President Bush
recognized that democratic institutions must reflect the values and
culture of diverse societies. As he said, "Our goal… is to help others
find their own voice, attain their own freedom, and make their own
way."

Being born ethnically Chinese does not predispose people against
democracy – just look at Taiwan's vibrant politics. Japan and South
Korea have successfully blended a Confucian heritage with modern
democratic principles.

Closed politics cannot be a permanent feature of Chinese society. It
is simply not sustainable – as economic growth continues, better-off
Chinese will want a greater say in their future, and pressure builds
for political reform:
# China has one umbrella labor union, but waves of strikes.
# A party that came to power as a movement of peasants now confronts
violent rural protests, especially against corruption.
# A government with massive police powers cannot control spreading crime.

Some in China believe they can secure the Communist Party's monopoly
on power through emphasizing economic growth and heightened
nationalism. This is risky and mistaken.

China needs a peaceful political transition to make its government
responsible and accountable to its people. Village and grassroots
elections are a start. They might be expanded – perhaps to counties
and provinces – as a next step. China needs to reform its judiciary.
It should open government processes to the involvement of civil
society and stop harassing journalists who point out problems. China
should also expand religious freedom and make real the guarantees of
rights that exist on paper – but not in practice.

Ladies and Gentlemen: How we deal with China's rising power is a
central question in American foreign policy.

In China and the United States, Mr. Zheng's idea of a "peaceful rise"
will spur vibrant debate. The world will look to the evidence of
actions.

Tonight I have suggested that the U.S. response should be to help
foster constructive action by transforming our thirty-year policy of
integration: We now need to encourage China to become a responsible
stakeholder in the international system. As a responsible stakeholder,
China would be more than just a member – it would work with us to
sustain the international system that has enabled its success.

Cooperation as stakeholders will not mean the absence of differences –
we will have disputes that we need to manage. But that management can
take place within a larger framework where the parties recognize a
shared interest in sustaining political, economic, and security
systems that provide common benefits.

To achieve this transformation of the Sino-American relationship, this
Administration – and those that follow it – will need to build the
foundation of support at home. That's particularly why I wanted to
join you tonight. You hear the voices that perceive China solely
through the lens of fear. But America succeeds when we look to the
future as an opportunity, not when we fear what the future might
bring. To succeed now, we will need all of you to press both the
Chinese and your fellow citizens.

When President Nixon visited Beijing in 1972, our relationship with
China was defined by what we were both against. Now we have the
opportunity to define our relationship by what are both for.

We have many common interests with China. But relationships built only
on a coincidence of interests have shallow roots. Relationships built
on shared interests and shared values are deep and lasting. We can
cooperate with the emerging China of today, even as we work for the
democratic China of tomorrow.


Released on September 21, 2005