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WORLD
To Hedge or Not to Hedge
As tensions rise, America and China woo Asia
T
Ie messuges couIdn`L be more dIIIerenL. AL LIe zoLI AsIu PucIIIc EconomIc CooperuLIon (Apec)
summIL In VIudIvosLok on SepLember 8-q, LIe guLIered Ieuders Irom ucross LIe oceun spoke oI
oneness Lo sLrengLIen LIe regIon`s prosperILy und IeudersIIp In LIe worId economy.
The zo1z euders` DecIuruLIon, wILI LIe conIerence
LIeme, nLegruLe Lo Grow, nnovuLe Lo Prosper,
cuIIed Ior Ireer Lrude, greuLer Lrunspurency, more hscuI
responsIbIIILy und dIsusLer prevenLIon, green IndusLrIes
und uccessIbIe educuLIon, und more secure Iood und
supply chains. And not a word about frictions
between countries.
RepresenLIng ubsenL U.S. PresIdenL Buruck Obumu,
SecreLury oI SLuLe HIIIury CIInLon sung u dIerenL Lune
from the summiteers. As reported by Agence France
Presse, sIe LoId LIe Iorum: Now Is LIe LIme Ior everyone
Lo muke eorLs Lo reduce LIe LensIon und sLrengLIen LIe
diplomatic involvement a widely perceived reference
to territorial disputes in the South and East China Seas.
She had much the same message in her meetings with
foreign ministers of the Association of Southeast Asian
Nations In JukurLu, und with Chinese Foreign Minister
Yung JIecII In BeIjIng LIe week beIore Apec.
We beIIeve LIe nuLIons oI LIe regIon sIouId work
collaboratively together to resolve disputes without
coercIon, wILIouL InLImIduLIon, wILIouL LIreuLs, und
cerLuInIy wILIouL LIe use oI Iorce, LIe U.S. SecreLury
of State LoId medIu uILer LIe JukurLu dIscussIons. She
also urged Asean to forge a binding code of conduct
to prevent incidents and reduce tensions among rival
claimants in the South China Sea.
As II LIree repeLILIons dIdn`L muke LIe poInL cIeur
enougI, u IourLI cume Irom CIInLon`s deIense
counLerpurL. As BBC reporLed, SecreLury eon PuneLLu
begun IIs AsIun Lour In Tokyo on Sunduy wILI u wurnIng:
I am concerned that when these countries engage in
Secretary-General Surin Pitsuwan welcomes U.S. Secretary
of State Hillary Clinton at Asean Secretariat Asean
STRATEGY POINTS
As Apec declares unity as key to prosperity and
leadership, America warns that territorial disputes
can hamper growth and spark war
After a decade of Asean-style hedging among
big powers, the Philippines embraces the U.S.
and takes on China. Should Asean change
course, too?
Beijing backed Asean against Hanoi`s aggression,
fnancial contagion and global recession. Is it now
the enemy?
BY RICARDO SALUDO
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:NKcenSEI8KVUXZ September 17-30, 2012
provocuLIons oI one kInd or unoLIer over LIese
vurIous IsIunds ... u mIsjudgmenL on one sIde or LIe
oLIer couId resuIL In vIoIence, und couId resuIL In
conIcL. And LIuL conIcL wouId LIen Iuve LIe
poLenLIuI oI expundIng.
Chinese Foreign Minister Yang downplayed regional
worrIes, wIIIe InsIsLIng LIere wus pIenLIIuI IIsLorIcuI
und jurIsprudenLIuI evIdence Ior ... sovereIgnLy over
IsIunds In LIe SouLI CIInu Seu und udjucenL wuLers.
In his SepL. press conIerence wILI CIInLon In BeIjIng`s
GreuL HuII oI LIe PeopIe, Yung suId CIInu und Aseun
members ugree Lo work Lowurds LIe evenLuuI udopLIon
of a code of conduct. He also added that freedom and
safety of navigation in the South China Sea is assured.
America's Pacic Pivot. So wIo`s goL LIe rIgIL
sLory: wur-worrIed WusIIngLon or becuImIng BeIjIng,
wIose IoreIgn mInIsLer suId IurLIer ubouL LIe regIon`s
wuLers: TIere Is no Issue currenLIy In LIIs ureu, nor
will there ever be issues in that area in the future. In
IucL, LIose Lwo conLrudIcLory perspecLIves ure LIe very
messages America and China are propagating in their
decudes-oId bId Lo buIId spIeres oI Inuence, II noL
ouLrIgIL uIIIunces, umong AsIun nuLIons, especIuIIy
those in Asean.
HuwkIsI eIemenLs In CIInu`s sLuLe und mIIILury-IInked
media have accused the U.S. of using the disputes ...
Lo jusLIIy un enIunced mIIILury presence In SouLIeusL
AsIu, reporLs MIcIueI SwuIne In IIs zo1z essuy,
Chinese Leadership and Elite Responses to the
U.S. PucIhc PIvoL for the Carnegie Endowment for
International Peace, u WusIIngLon-bused LIInk-Lunk.
TIe PIvoL Is LIe Obumu udmInIsLruLIon`s poIIcy sIIIL
to refocus U.S. geopolitical and security strategy on
AsIu, IncIudIng 6o% oI ILs nuvuI usseLs, us ouLIIned In
LIe PenLugon`s Defense Strategic Guidance published
In Junuury.
TIose unocIuI buL BeIjIng-Inuenced urLIcIes uIso
contend that Washington is using Manila to strengthen
its control over the region and to contain China.
WIeLIer LIuL vIew Is vuIId, LIe U.S. Ius cerLuInIy
Increused mIIILury ucLIvILIes In SouLIeusL AsIu, especIuIIy
wILI LIe PIIIIppInes und VIeLnum, us murILIme
conIronLuLIons wILI CIInu InLensIhed In recenL yeurs.
Armed Forces International cited those tensions as
buckdrop Ior U.S.-VIeLnum nuvuI exercIses In AprII.
U.S. Nuvy sIIps now geL repuIred In VIeLnum sIIpyurds,
including the old American base at Cam Ranh Bay. In
June, reported World Politics Review, PuneLLu becume
Photo and range of missiles reportedly being deployed in southern China: To protect its forces and allies, the U.S.
plans anti-missile systems YouTube
To hedge or not to hedge
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LIe hrsL AmerIcun deIense secreLury Lo vIsIL LIe IucIIILy
sInce LIe VIeLnum Wur ended ; yeurs ugo.
The end of hedging. Equally dramatic is the
swing in U.S.-Philippine military cooperation. As
De La Salle University professor Renato Cruz de
CusLro expIuIns In Between the Clawing Eagle and
the Ascendant Dragon: The Demise of the Philippine
Policy of Hedging, LIe AquIno udmInIsLruLIon junked
ILs predecessor`s decude-oId poIIcy oI buIuncIng LIe
mujor powers (UnILed SLuLes, Jupun, und CIInu) In
EusL AsIu uguInsL eucI oLIer Lo enIunce Ie counLry`s
national security goals as Asean has done.
Toduy, U.S. mIIILury engugemenL In LIe PIIIIppInes
Ius gone Iur beyond LIe nurrow conhnes oI
counLerLerrorIsm ussIsLunce In MIndunuo. Mujor nuvuI
vesseIs Iuve docked In SubIc, reporLs LIe Philippine
Star, IncIudIng three nuclear submarines this year,
all with TomuIuwk cruIse mIssIIes capable of carrying
zoo-kIIoLon uLomIc wurIeuds more LIun 1,ooo km -
from Manila to southern China.
A U.S. Navy vessel will also be repaired in the former
AmerIcun nuvuI buse, uccordIng Lo LIe Philippine
Daily Inquirer. And In JuIy, Reuters quoted President
Benigno Aquino III saying that the Philippines might
usk U.S. spy pIunes Lo IeIp puLroI dIspuLed wuLers In
the South China Sea. And if China is worried about
LIe regIon gungIng up on IL, IL won`L IeIp Lo Ieurn
that Jupun Is gIvIng LIe PIIIIppInes 1z urmed puLroI
boats hLLed wILI modern equIpmenL. SouLI Koreu
und AusLruIIu muy uIso IeIp, ondon`s The Guardian
reported last month, und WusIIngLon pIuns Lo gIve
two navy ships on top of the two coast-guard cutters it
turned over to Manila some months ago.
Beijing the 'buIIy.' I AmerIcu Is uIIegedIy expIoILIng
territorial confrontations to escalate its military
depIoymenL In SouLIeusL AsIu, CIInu Ius cerLuInIy
done mucI Lo gIve ILs neIgIbors, especIuIIy LIe
PIIIIppInes, reuson Lo cry UncIe Sum! As II MunIIu
was not intimidated enough in confrontations over a
Philippine-authorized research ship in the Spratlys and
LIe urresL oI CIInese hsIermen In ScurborougI SIouI,
BeIjIng bured In JuIy u pIun Lo buIId u gurrIson In LIe
SpruLIys, according to Agence France Presse.
In the same month came news in Chinese media
about the deployment of a ballistic missile brigade in
Guangdong Province (see picture and map, page 12)
reporLedIy cupubIe oI IILLIng uII oI Aseun, IncIudIng LIe
entire Philippines and northern islands of Indonesia.
If that was supposed to dissuade countries challenging
BeIjIng`s LerrILorIuI cIuIms, IL uIso guve WusIIngLon LIe
openIng Lo oer unLI-mIssIIe sysLems Lo ILs uIIIes.
Last month the Wall Street Journal reported that the
U.S. pIuns u mujor expunsIon oI mIssIIe deIenses In
Asia. While North Korea was the supposed focus on
LIe pIunned unLI-mIssIIe sysLems, LIey cun jusL us weII
be used uguInsL CIInese projecLIIes. TIe InILIuI pIun Is
Vietnamese President Truong Tan Seng meets Chinese leader Hu Jintao at APEC: Isolating the Philippines? CNTV
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:NKcenSEI8KVUXZ September 17-30, 2012
Lo InsLuII u second X-Bund rudur In u souLIern Jupun
IsIund Lo suppIemenL LIe hrsL InsLuIIuLIon, uIso In Jupun.
And the U.S. is scouting for a site for the third X-Band
somewhere in Southeast Asia.
SInce ILs nuvy won`L be u muLcI Ior LIe SevenLI IeeL
Ior uL IeusL u decude, CIInu wouId reIy muInIy on ILs
ballistic missiles to counter the U.S. Navy in any future
conIcL, especIuIIy In LIe SouLI CIInu Seu, wIere Iour-
hILIs oI ILs ImporLed oII pusses. BuL robusL U.S. unLI-
mIssIIe deIenses couId bIunL LIe hrsL suIvo oI CIInese
projecLIIes, uIIowIng uIr sLrIkes uguInsL commund und
conLroI sILes Lo ImmobIIIze or bIInd muny, II noL mosL oI
CIInu`s cousLuI rockeL buLLerIes.
Whither Asean? n LIIs IIgI-sLukes mIIILury
mucIInuLIons, wIere wIII Aseun go? Or wIII IL wIILIer
Irom dIvIsIve superpower poIILIcs? or LIe groupIng`s
Ieuder ndonesIu, LIe ImmedIuLe concern Is resLorIng
its unity after the unprecedented failure to issue a
joInL communIque uL LIe end oI ILs mInIsLerIuI
conIerence In JuIy.
Indonesian Foreign Minister Marty Natalegawa found
Aseun`s Ioss oI common words uLLerIy IrresponsIbIe,
blogged the Voice of America. eL`s keep IL un
excepLIon. Aseun conLInues Lo remuIn unILed, Lo be
coIesIve on uII Issues oI common concern, noL IeusL und
especially on the issue of the South China Sea.
TIuL wIII Luke mucI dIpIomuLIc medIuLIon by MInIsLer
MurLy IImseII, wIo musL smooLI dIerences beLween
MunIIu und HunoI, on one Iund, und PInom PenI, on
the other. Not to mention America and China: they
ure suId Lo be usIng LIe PIIIIppInes und CumbodIu,
respecLIveIy, us proxIes Lo pusI LIeIr ugendu In Aseun.
Both big powers are now trying to get on the good side
of Indonesia. Early last month Chinese Foreign Minister
Yung swung LIrougI KuuIu umpur, JukurLu und BruneI
Darussalam. Minister Marty said in a Jakarta Globe
report on The Irrawaddy site that Yang reported good
progress in discussions with Asean on the Code of
ConducL. SecreLury CIInLon meunwIIIe expressed IuII
U.S. supporL Ior ndonesIu`s medIuLIng roIe, pruIsIng
Marty and President Susilo Bambang Yudhoyono for
LIeIr eorLs Lo Iorge u common Aseun posILIon on LIe
South China Sea.
Odd Manila out? BesIdes ucknowIedgIng ndonesIu`s
sLuLure In Aseun, BeIjIng muy uIso be movIng Lo IsoIuLe
LIe PIIIIppInes. AL Apec, reported Agence France
Presse, CIInese PresIdenL Hu JInLuo wus unubIe Lo
hnd LIme Ior PIIIIppIne PresIdenL AquIno, buL meL
wILI Ieuders oI oLIer rIvuI IsIund cIuImunLs, IncIudIng
Jupun und VIeLnum. Even VIeLnumese PresIdenL
Truong Tun Sung, wIose counLry Ius Iud skIrmIsIes
wILI CIInu over dIspuLed IsIunds, Iud u IuII deIeguLIon
sIL-down wILI Hu, wIen boLI counLrIes urmed LIeIr
commitment to resolve disputes peacefully.
Upon IIs reLurn Irom VIudIvosLok on SepL. q, PresIdenL
AquIno decIured: TIe Ieuders oI SIngupore, MuIuysIu,
und VIeLnum Iuve exLended LIeIr wurm supporL Lo us...
purLIcuIurIy regurdIng LIe LuIks on LIe WesL PIIIIppIne
Seu, according to news site Rappler.com. But the
IoIIowIng duy SIngupore`s oreIgn MInIsLry issued
a denial: we do noL Luke sIdes ... PM ee cuIIed on
uII cIuImunLs Lo exercIse resLruInL und Ior dIspuLes Lo
be resolved peacefully and in accordance with
international law.
I mosL oI Aseun muy be reIucLunL Lo cross CIInu,
IL muy be more LIun jusL Ieur oI LIe mIIILury und
economic pressure it has put on the Philippines
over LIeIr conIronLuLIons on LIe IIgI seus. n IucL,
us severuI dIpIomucy scIoIurs Iuve poInLed ouL, LIe
Chinese have been good neighbors to Asean for more
LIun Lwo decudes. By conLrusL, LIe AmerIcuns Iud
puIIed buck Ior mucI oI LIuL LIme, prompLIng cuIIs Lo re-
enguge In AsIu us IuLe us zoo6.
Making friends and inuencing nations. In her
zoo puper, China and Asean: Renavigating Relations
To hedge or not to hedge
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Ior u z1sL CenLury AsIu, UnIversILy oI DeIuwure
proIessor AIIce Bu recounLed LIe key sLuges oI SIno-
Aseun reIuLIons. SIe noLed LIuL sInce 1q;8, CIInu
Ius been supporLIve oI Aseun In mujor regIonuI
concerns. n 1q;8-8q LIey were de facto allies
uguInsL VIeLnum`s occupuLIon oI CumbodIu. rom
1qqo Lo 1qq;, reIuLIons IurLIer Improved, especIuIIy
uILer ndonesIu normuIIzed LIes wILI CIInu, wIIcI
had been frozen after the crushing by longtime
sLrongmun SuIurLo In 1q6o oI u BeIjIng-bucked
communist coup attempt.
Rapport between China and Asean further
InLensIhed durIng LIe 1qq; AsIun hnuncIuI crIsIs,
wIen BeIjIng supporLed regIonuI recovery und
currency sLubIIILy by noL devuIuIng LIe renmInbI,
despILe LIe Iuge Ioss In exporL compeLILIveness
due to regionwide devaluations. This contrasted
wILI LIe WesL`s sLrIdenL IecLurIng und ImposILIon
of harsh emergency loan conditions. And in the
pusL decude, CIInu IurLIer buLLressed LIes LIrougI
burgeonIng Lrude, InvesLmenL, deveIopmenL uId, und
even mIIILury cooperuLIon, us recounLed by respecLed
CIInu experL WIIIy um In IIs zoo urLIcIe, BeIjIng`s
SLruLegy Lo CounLer U.S. nuence In AsIu.
ndeed, IL wusn`L jusL In AsIu, buL uII over LIe
deveIopIng worId. n IIs musLer`s LIesIs, nuence
The New Weapon in the Battle for Southeast
Asia, U.S. Army Mujor RIcIurd MunnIng noLed
LIuL BeIjIng guve uId wILI no sLrIngs uLLucIed. He
added: It sought to cultivate relationships with
countries that had poor relations with the United
SLuLes. Toduy, LIe PRC sLIII uLIIIzes LIe sume
upproucI, buL Is now LurgeLIng U.S. uIIIes In un
attempt to undermine these relationships.
While America was away. By conLrusL, LIe
UnILed SLuLes Ius, Ior LIe mosL pusL, dImInIsIed In
stature and engagement after the Vietnam War and
even more so following the collapse of the Soviet
UnIon In 1qqo. n IIs zoo; puper, Does China
seek Lo domInuLe AsIu und reduce U.S. Inuence
us u regIonuI power?, GeorgeLown UnIversILy
professor Robert Sutter recounted that America
wenL LIrougI perIods oI IosL conhdence over LIe
Ioss oI SouLI VIeLnum In LIe 1q;os und Jupun`s
economIc rIse In LIe 1q8os.
Then came the decade of disinterest in Asia
us u CoId Wur urenu umId SovIeL decIIne, und
WusIIngLon`s reIucLunce Lo enguge wILI regIonuI
groupings for fear of its prerogatives as the
sole superpower being curbed in international
bodies. The war on terror brought the Americans
buck Lo u degree, muInIy Lo recruIL uIIIes uguInsL
Reuters Sept. 18 video on escalating Chinese protests against Japan over the disputed Diaoyutai/Senkaku islands
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To hedge or not to hedge
News & Strategy Alerts
World
APEC 2012: Issues
and Priorities
Weighing heavily on the prospects of
economic cooperation, are unresolved
territorial disputes involving many of its
member-countries
To counter apparent moves to isolate the
Philippines in the South China Sea issue,
the Philippine government must reach out to
all claimants and push for joint development
of disputed territories
usL SepLember ;-8, worId Ieuders guLIered In
VIudIvosLok, RussIu Lo dIscuss gIobuI und regIonuI
concerns uL LIe zoLI AsIu-PucIhc EconomIc
Cooperation (APEC) Summit. At the end of the
Lwo-duy summIL, Ieuders Irom APEC`s z1-member
economies came out with a zo1z euders` DecIuruLIon
reiterating commitments to trade and investment
IIberuIIzuLIon und regIonuI economIc InLegruLIon,
among others.
TIe summIL`s sIgnIhcunL ucIIevemenL, us cILed by
muny observers, wus on IIberuIIzIng Lrude on eco-
friendly goods. APEC members agreed on a list of
q producLs wIose LurI ruLes wIII be reduced Lo %
or Iess by LIe end oI zo1. AccordIng Lo U.S. Trade
LIe exLremIsLs. And uILer LIe zoo8 U.S. hnuncIuI
debucIe, AmerIcu wus Loo bogged down In economIc
und hscuI burdens Lo compeLe wILI CIInu Ior
regIonuI Inuence. AII LIuL cIunged, oI course, wILI
LIe PucIhc PIvoL, spurred by LIe reuIIzuLIon LIuL LIe
U.S. musL reguIn cIouL In wIuL wIII be LIe worId`s
largest economic region in the coming decades.
So which will Asean side with absentee America
on LIe comebuck Lo reguIn ILs pusL cIouL, or resurgenL
CIInu, wIIcI Ius been IurgeIy supporLIve oI ILs
neIgIbors und Is now poIsed Lo become LIe worId`s
largest economy and an even more formidable
mIIILury power In LIe comIng decude?
n IIs zoo; puper, ProIessor SuLLer urgued
LIuL CIInu wouId noL domInuLe AsIu, gIven some
mujor weuknesses IoIdIng IL buck. PIus: MosL
Asian governments maneuver and hedge against
CIInu`s rIse, und LIey hnd u sLrong U.S. presence In
Asia fundamentally important and reassuring.
n sIorL, CIInu won`L domInuLe becuuse Aseun
will hedge.
Ive yeurs IuLer, uL LIe 6th Berlin Conference on
Asian Security LIIs pusL June, LIe GeorgeLown
professor summed up that the forum found no
reason to drastically change the current U.S.
strategy toward China: a continuation of the wide
ranging positive engagement along with carefully
munuged growIng ureus oI economIc, poIILIcuI und
security competition.
Now if the United States continues to engage China
pretty much along the same lines as it has done for
yeurs, wIuL good reuson Is LIere Ior Aseun Lo muke u
drastic shift in its decades-old big-power balancing
ucL, possIbIy rIskIng ILs uII-ImporLunL consensus und
unILy? ndeed, wIy dId MunIIu cIunge geur Irom LIe
IedgIng Luck, now wunLIng LIe resL oI Aseun Lo do
LIe sume? Go hgure.
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