When giants fight, even the wisest Southeast Asian leaders are left helpless

Hawaii-based academic Denny Roy notes the growing tension between North and South Korea, as well as US relations with China and the rest of the world, and explores how these might affect the situation in Southeast Asia.
A South Korean soldier stands at a checkpoint on the Tongil bridge, the road leading to North Korea's Kaesong joint industrial complex, in the border city of Paju on 24 June 2020. (Jung Yeon-je/AFP)
A South Korean soldier stands at a checkpoint on the Tongil bridge, the road leading to North Korea's Kaesong joint industrial complex, in the border city of Paju on 24 June 2020. (Jung Yeon-je/AFP)

Southeast Asia can scarcely escape the consequences of major strategic changes in Northeast Asia, a global epicentre of military and economic power, as well as friction among a collection of strong states. At least three sources of tension have recently emerged there.

First, North Korea has declared an end to its nascent detente with South Korea. Second, the US is behaving as if it no longer values its alliances with Japan and South Korea. And third, US-China relations have reached a new nadir. These three dynamics pose differing levels of threat to Southeast Asia: one is long-term but minor; one is serious but likely short-term; and one is both serious and long-term.

The Koreas

In 2018, the North and South Korean governments took steps that suggested that a lasting rapprochement between the long-time enemies might be achievable. After two consecutive conservative presidents, South Korea was under the leadership of President Moon Jae-in, who was relatively accommodating towards Pyongyang. Moon met with North Korean paramount leader Kim Jong-un three times, and they agreed to increase the size of the demilitarised zones on either side of both their land and sea borders, plus other confidence-building measures. Pyongyang allowed Seoul to build the Inter-Korea Liaison Office — a quasi-embassy — in Kaesong.

Apparent progress is quickly swept away, however, when Pyongyang inevitably decides being nice to Seoul is no longer useful. 

liaison office
A view of an explosion of a joint liaison office with South Korea in border town Kaesong, North Korea in this picture supplied by North Korea's Korean Central News Agency (KCNA) on 16 June 2020. (KCNA via REUTERS)

With this apparent progress in mind, the rapid unravelling of inter-Korean relations in 2020, culminating with televised images of the North Koreans symbolically blowing up the Liaison Office on 16 June 2020, might appear tragic and deeply disturbing.

In fact, however, this marked the return to a familiar pattern. Pyongyang generally treats Seoul contemptuously, attempting to extort concessions through military threats. Occasionally the North Koreans briefly interrupt this posture with a peace offensive. Apparent progress is quickly swept away, however, when Pyongyang inevitably decides that being nice to Seoul is no longer useful. Raising hopes and then dramatically dashing them is Pyongyang’s modus operandi.

The North Korea case supports the adage that there is a security benefit in possessing nuclear weapons, but not in using them.

There are at least four possible factors involved in the latest downturn in North-South relations. Pyongyang’s stated reason is its outrage over anti-government propaganda balloons sent over the border by South Korean civic groups, including defectors from North Korea. A deeper issue is Pyongyang’s disappointment that the Moon government has not delivered enough of the economic benefits that he has promised. Third, Pyongyang may be rushing to establish Kim’s sister Kim Yo-jong as a respectable successor in case of the current leader’s untimely death. Although still in his thirties, Kim Jong-un has obvious health problems and has recently disappeared from public view for long periods. North Korean media made Kim Yo-jong the featured critic and threatener of South Korea prior to the destruction of the Liaison Office. Finally, Pyongyang may be trying to force a distracted US to re-engage in talks about lifting the economic sanctions against North Korea. The important point is that the thaw of 2018 was destined to break down for one reason or another because Pyongyang was never committed to it.

The return of tensions on the Korean Peninsula is the least consequential of the three major developments in Northeast Asia. Despite appearances, the strategic situation there is stable. North Korea’s deployment of nuclear missiles — the efficacy of which is still unproven has changed the standoff remarkably little. The North Korea case supports the adage that there is a security benefit in possessing nuclear weapons, but not in using them. Pyongyang
might carry out a nuclear attack on an adversary in response to an extreme scenario, such as a US-South Korean invasion intent on extinguishing the regime. Yet Washington and Seoul would not invade except in response to a major military attack, such as a nuclear strike, by North Korea. Thus deterrence holds.

Pyongyang also seems to be deterred from small-scale lethal attacks since Seoul announced in 2010 that thereafter it would respond to these with military force. Indeed, after threatening “military action” in retaliation for South Korea’s balloon launches, Pyongyang announced in late June that it was suspending those plans.

Trump has criticised allies Japan and South Korea as wealthy free-riders offering little or no strategic benefit to the US.

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A South Korean soldier guards the entrance to the camp Kumgang Mountain military base near the border area of Goseong on South Korea's northeast coast on 17 June 2020. (Ed Jones/AFP)

US alliances

A second source of strategic tension recently emerging in Northeast Asia threatens the survival of the US’s key alliances with Japan and South Korea. Disdain for alliances and insistence that allies pay for US protection are two consistent principles in US President Donald Trump’s discussions of foreign policy. Trump has criticised allies Japan and South Korea as wealthy free-riders offering little or no strategic benefit to the US. He makes this criticism in connection with his complaints about America’s trade deficits with Japan and South Korea (US$69 billion and US$23 billion annually, respectively).

Although Japan currently pays 70% of the costs of the US military bases it hosts, Trump has said Tokyo should pay 100%. He reportedly feels similarly about South Korea. Trump has called US military exercises with South Korea “very provocative” (the same criticism North Korea makes) and “very expensive.”

During its first three years, the Trump administration avoided taking steps that might seriously damage these alliances. But now, in the final year of Trump’s term, Washington is putting its relationships with Tokyo and Seoul under stress.

Bilateral agreements for host nation support of US bases are regularly renewed, creating opportunities for revision of terms. The most recent US-South Korea agreement, under which Seoul paid the US government nearly US$1 billion annually, expired at the end of 2019. The Trump administration now demands that Seoul raise its payment to US$5 billion per year, a five-fold increase. 96% of the South Korean public opposes acceding to this demand, making it politically impossible for Moon’s government to accept.

Tokyo is equally unlikely to accept the Trump administration’s demand that Japan increase its host nation support from US$2 billion to US$8 billion annually after the current agreement expires in March 2021. Earlier in June, Japan abruptly suspended its planned installation of Aegis Ashore, a US-made anti-missile defense system, in what might be an indication that Prime Minister Shinzō Abe’s willingness to accommodate Trump has limits.

The collection of rules and institutions that make up the US-led liberal regional order, which facilitates prosperity and security for many Southeast Asian countries, would give way to a Chinese sphere of influence.

The huge increases demanded by Washington could be dismissed as opening positions in a bargaining process likely to result in a mutually-acceptable compromise. But this overlooks well-grounded suspicions that Trump actually wants to quit the alliances and is pursuing his wish through means that bypass the US Congress.

Abe and Trump
Japan's Prime Minister Shinzō Abe speaks as U.S. President Donald Trump listens during a bilateral meeting on the sidelines of the 74th session of the United Nations General Assembly (UNGA) in New York, 25 September 2019. (Jonathan Ernst/REUTERS)

The end of these alliances would signal China’s replacement of the US as the preeminent strategic power in Northeast Asia. Japan and South Korea would come under increased pressure to accommodate China; Japan would almost certainly develop nuclear weapons. The US might retain its partnerships with Australia and some of the Pacific island states, but its ability to exercise influence in maritime Southeast Asia would be fatally compromised. The collection of rules and institutions that make up the US-led liberal regional order, which facilitates prosperity and security for many Southeast Asian countries, would give way to a Chinese sphere of influence.

The sudden instability of American alliances in the region is a more serious threat to Southeast Asia than resurgent inter-Korean tensions, but possibly a short-lived one. Previous US presidential administrations led by both major American political parties pressed Tokyo and Seoul to pay a little more toward the cost of hosting US bases, but they
never questioned the value of these alliances to America’s vital interests. The issue could disappear as quickly as in November 2020 if Trump fails to win re-election. Trump’s opponent Joe Biden, who at this writing leads Trump by a wide margin, would likely return to the posture of the recent past. Biden promises he would “strengthen our alliances with Japan, South Korea, Australia and other Asian democracies”.

US-China relations

Unfortunately, the third form of rising tension in Northeast Asia will persist far beyond 2020 and represents a serious danger to Southeast Asia. US-China relations may be shifting in a way that is both fundamental and dangerous. The shift is propelled by strategic recalculations within both countries.

... why didn’t the US implement a serious containment policy starting in the 1990s, when China’s hegemonic potential became clear?

Under the Trump administration, US declarative policy towards China has noticeably hardened. Previous presidents from both major US political parties characterised US-China relations as a mixture of cooperation and competition. But recent authoritative US government documents such as the 2017 National Security Strategy and the 2018 National Defense Strategy have described the US-China relationship in mainly adversarial terms, with China “attempting to erode American security and prosperity,” and seeking to “displace” the US to achieve Chinese “hegemony” in the Asia-Pacific region, requiring “both increased and sustained [US military] investment". 

Senior National Security Council official Matt Pottinger said in 2018, “We at the administration have updated our China policy to bring the concept of competition to the forefront.” The shift is not simply rhetorical. US Navy “freedom of navigation” patrols intended to challenge China’s excessive maritime claims in the South China Sea increased from zero in 2014 to nine in 2019.The US government has also made new if modest gestures of support for Taiwan, as if Washington is less concerned about infuriating Beijing.

America’s new posture jeopardises the continuation of US economic and educational cooperation that has been an immense boon to Chinese development. Despite long-running Chinese complaints about alleged attempts to “contain” China, Chinese officials and analysts recognise the value to Chinese economic development of China’s trade surplus with the US, which was still a staggering US$300 billion in 2019 despite the bilateral “trade war” and the transfer of US scientific, technological and managerial expertise to China. 

Chinese diplomacy toward the US incessantly calls for solving the trade dispute, “developing a stronger and more stable relationship” etc., precisely because the post-Cold War status quo has been so beneficial to China. Indeed, the question arises: why didn’t the US implement a serious containment policy starting in the 1990s, when China’s hegemonic potential became clear?

It is important to note that the basis of this shift in US policy is not increased Chinese capabilities alone, but rather the combination of increased Chinese capabilities and a perceived change in China’s intentions.

flags
U.S. President Donald Trump delivers his speech as he and China's President Xi Jinping meet business leaders at the Great Hall of the People in Beijing, 9 November 2017. (Damir Sagolj/REUTERS)

A common American explanation is that for decades, US policy-makers hoped a combination of enmeshing China within international institutions and helping China grow wealthy through robust trade and investment would channel the Chinese government towards convergence with the US-sponsored liberal regional order. The pronounced
change in US policy towards China after the Obama administration left office reflected American disillusionment with Xi Jinping-led China, which became more illiberal in both its domestic and foreign policies despite being wealthier and more cosmopolitan than ever before. 

US national security adviser Robert C. O’Brien said the American belief that “the Chinese Communist Party would liberalise to meet the rising democratic aspirations of its people” was a “miscalculation” and “the greatest failure of American foreign policy since the 1930s”.

It is important to note that the basis of this shift in US policy is not increased Chinese capabilities alone, but rather the combination of increased Chinese capabilities and a perceived change in China’s intentions. American observers see in recent Chinese military improvements a focus on preparing to fight US intervention to assist friendly governments in the region. They also see increased Chinese bullying, economic coercion and other forms of Chinese intervention in the domestic politics of other states to promote Chinese self-interests, stronger Chinese attempts to unilaterally solve territorial disputes on China’s terms, and a ruthless form of mercantilism that includes routine use of corruption, industrial espionage and cyber theft on a massive scale, and systematic violation of World Trade Organization norms and rules.

If China continued to close its power gap with the US, Washington’s fears about China becoming a strategic competitor would increase and eventually cause a shift in US policy towards treating China as an outright enemy...

The Chinese, however, have an alternative explanation for the hardening of US policy towards China. In the Chinese Communist Party worldview, the US has never been anything but an imperialist, “hegemonic,” “selfish” great power. But the US business community wants to make money from China, which requires economic engagement facilitated by a peaceful strategic environment. Until recently, the power gap between the US and China was wide enough for the economic imperative to overwhelm American worries about a stronger China being a future threat to the US strategic position in the Asia-Pacific region. This helped create what recent Chinese leaders have called a “period of strategic opportunity” for China. This period was always implicitly temporary.

If China continued to close its power gap with the US, Washington’s fears about China becoming a strategic competitor would increase and eventually cause a shift in US policy towards treating China as an outright enemy, including cutting off economic and other forms of cooperation that might contribute to China’s “rise". This explanation is consistent with what International Relations scholars call power transition theory. Notably, this Chinese view rests solely on relative capabilities, taking Chinese intentions out of the picture. It thus implicitly absolves Beijing of responsibility for policies other governments might consider aggressive and expansionist.

5g
A man and a child wearing face masks following the coronavirus disease (COVID-19) outbreak walk past a 5G sign inside a Huawei store at a shopping mall in Beijing, 14 July 2020. (Tingshu Wang/REUTERS)

Chinese scholars such as Yuan Peng and Yan Xuetong were arguing a decade ago that US resistance to China’s development will increase as China becomes relatively more powerful. This view is now increasingly common among Chinese analysts. Zhao Minghao recently noted: “Most Chinese analysts acknowledge the inevitability of US-China strategic competition. In their opinion, the narrowing power gap is its most decisive driver.” Accordingly, Chinese analysts accept that a tougher US policy towards China is bipartisan and will persist even if Trump does not win a second term. As Zhou Xiaoming, a former senior PRC diplomat, puts it, “The deep feeling in the US is that the US should contain China. Whether Trump wins, or Joe goes to Washington, things will get worse.”

In Chinese eyes, US policies look more than ever like outright attempts to suppress China’s continued economic development. Chinese analysts see the “Indo-Pacific strategy” not only as anti-China alliance building, but also as Washington discouraging other governments from participating in Beijing’s Belt and Road Initiative. Similarly, they see calls by Americans for economic “decoupling” from China through the lens of Cold War-style containment.

Not only the US, but also Japan, Western Europe and Australia are seeking to reduce their reliance on China.

Thus, both US and Chinese elites seem to believe the era in which cooperation outweighs strategic competition is ending. There are two major consequences for the Asia-Pacific region.

The first is less US-China cooperation. While total decoupling is impossible, partial decoupling is already underway. Americans henceforth will be more attuned to the possibility that particular kinds of technical or economic cooperation are assisting China’s opposition to America’s strategic agenda.

Parts of Southeast Asia will enjoy new business opportunities as a consequence of the reorganisation of supply chains to reduce US dependence on China. The downsides, however, are large. Not only the US, but also Japan, Western Europe and Australia are seeking to reduce their reliance on China. To the extent that the major industrialised democracies partially decouple, China will have less incentive to conform with liberal international norms as the price of participation in international regimes. Reduced US-China economic cooperation makes military conflict more likely by weakening one of the main disincentives to war. Mutual suspicions will also impede Sino-US collaboration in important areas of common concern, such as climate change and epidemiology, of which other regions such as Southeast Asia are potential beneficiaries.

The second major consequence of ascendant US-China hostility is that their competition for strategic influence will become permanently more intense and zero-sum. This situation will persist until at least one of the contestants abandons the competition or there is a military conflict that re-establishes a stable hierarchy. The other Asia-Pacific governments will come under increased and more open pressure from both big powers to support one against the other. The strategic points of friction in the region, including the South China Sea, will become more tense, threatening to impede the free flow of commerce. The region will see elevated risk of an unintended war breaking out.

Unfortunately, even the wisest statesmanship by the Southeast Asian governments — both individually and as a group — will not insulate the sub-region from being singed by the fires of dangerous rivalries among the powerful states to the north.

This article was first published as ISEAS Perspective 2020/78 “Tensions in Northeast Asia Pose Varying Threats to Southeast Asia” by Denny Roy.

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