European Union

Institute for Security Studies

Analysis
Nicola Casarini*
September 2012

EU forEign Policy in thE ASiA PAcific: Striking thE right bAlAncE bEtwEEn thE US, chinA And ASEAn
EU foreign policy in the Asia Pacific is stepping up a gear. The visit of Catherine Ashton to Asia in July 2012, which included her meeting with Chinese leaders, her subsequent participation for the first time in the ASEAN Regional Forum (ARF) in Phnom Penh and the issuing of the joint EU-US statement on the Asia Pacific, clearly indicate the interest, and the readiness, of the EU to be more involved in the region. With the Asia Pacific now firmly on the EUs agenda and transatlantic cooperation on the region moving ahead, it is time for the EU to devise a clear strategic vision of its role and priorities in the area, including the development of its own autonomous position on the most important security flashpoints, with particular attention paid to the territorial and maritime disputes in the South China Sea. Only by doing so will the EU be better positioned to raise its profile and promote more effectively its interests and values in this distant but increasingly important part of the world.
Ng Han Guan/AP/SIPA

EU foreign policy chief Catherine Ashton (left) shakes hand with Chinese State Councilor Dai Bingguo after a press briefing at the Diaoyutai State Guest House in Beijing, Tuesday, July 10, 2012

EU-US Pacific partnership

The most publicised outcome of Ashtons recent visit to Asia was the issuing of the joint EU-US statement on the Asia-Pacific region. This statement is the culmination of diplomatic efforts and consultations that have occurred between the transatlantic allies since autumn 2011, when the final declaration of the US-EU summit mentioned for the first time the Asia Pacific as a region where dialogue and cooperation can be furthered between Washington and Brussels. In preparation for the joint EU-US statement, the European External Action Service (EEAS) released on 15 June 2012 an updated and revised version of the Guidelines on the EUs Foreign and Security Policy in East Asia first published in 2007.1 The elaboration of the 2007 Guidelines began in summer
1. General Secretariat of the EU, Guidelines on the EUs Foreign and Security Policy in East Asia (11492/12), Brussels, 15 June 2012. This is the revised version of the Guidelines on the EUs Foreign and Security Policy in East Asia, adopted by the Council of the EU during the 2842nd Council Meeting (16183/07), Brussels, 20 December 2007.

2005 in the aftermath of the official shelving of the proposal to lift the EU arms embargo on China and was adopted at the European Council in Brussels on 20 December 2007. The Guidelines were designed to send a reassuring message to the US about EU intentions in a region where security and public goods are guaranteed by Washington but where the Union is politically absent. The publication of the Guidelines in 2007 marked the end of those elements of the EU-China relationship perceived to be detrimental to US role and responsibilities in East Asia, in particular the proposal by some EU member states to offer China greater political recognition by opening discussions on the lifting of the EU arms embargo imposed on Beijing after the crackdown in Tiananmen Square in June 1989. With the publication of the revised Guidelines in June 2012 which now mention issues absent in the previous version such as the South China Sea disputes Brussels once again aligned its position on the Asia Pacific with that of Washington, thereby

* Nicola Casarini is a Research Fellow at the EUISS. He deals with EU-China and EU-East Asia relations and Chinese foreign policy.
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preparing the ground for the joint EU-US declaration at the ARF meeting in July. The joint EU-US statement on the Asia-Pacific region focuses on three areas of concern for the transatlantic allies: security, sustainable development, and trade.2 Clear wording is used with regard to territorial and maritime disputes in the South China Sea which have the potential to affect the security of the sea lanes on which US and EU trade with the region depend. In this context, the EU-US joint declaration contains an expression of encouragement for ASEAN and China to advance a Code of Conduct and to resolve territorial and maritime disputes through peaceful, diplomatic and cooperative solutions. The EU and the US also pledge their commitment to work with Asian partners on increasing maritime security based on international law as reflected in the UN Convention on the Law of the Sea. These are important passages that show the commitment of the transatlantic allies to the promotion of a stable and peaceful environment in a region which nowadays seems to have been put at risk by conflicting territorial and maritime claims between a rising and more assertive China and its smaller and weaker neighbours of South East Asia. The joint EU-US statement is undoubtedly a starting point for closer transatlantic cooperation in the Asia Pacific, and as highlighted by Patryk Pawlak and Eleni Ekmektsioglou in a recent article3 includes an opportunity for the Western allies to promote a set of principles and values dear to their domestic public opinions which range from human rights to open markets and from the protection of intellectual property rights to the rule of law. In this vein, the joint statement can also be read as a political message addressed to China, indirectly criticising its socio-economic and political system which is still tightly controlled by the Communist Party. The question of values and its foreign policy implications had been brought into the spotlight during the visit of US Secretary of State to Ulan Bator in early July. In a vigorous speech, Mrs Clinton praised the pluralistic, democratic system of Mongolia the country on Chinas doorstep resurrecting the idea of a community of democracies, a concept similar to that of the concert of democracies in vogue some years ago and used by the John McCain campaign during the 2008 US presidential election.4 At that time, the suggestion was made by the Republican camp that the political system of the Peoples Republic of China should not be treated as a neutral element but should, instead, have a bearing on the foreign policy of the liberal-democratic nations. The EU alluded to this issue in the Guidelines on the EUs Foreign and Security Policy in East Asia (both versions) when referring to Japan and South Korea as
2. Joint EU-US statement on the Asia Pacific region, Phnom Penh, 12 July 2012. 3. Patryk Pawlak and Eleni Ekmektsioglou, Americas and Europes Pacific Partnership, The Diplomat, 23 July 2012. See also by the same authors: Transatlantic strategies in the Asia Pacific, EUISS Analysis, June 2012. 4. Secretary Clintons Remarks to the Launch of Leaders Engaged in New Democracies Network, Ulan Bator, 9 July 2012.

like-minded and natural political partners of the EU in the Asia Pacific.5 It is a major tenet of the liberal school of international relations that the internal political system has important effects on a states foreign policy and that democracies rarely fight each other. During the administration of George W. Bush, US neoconservatives (amongst others) brought back to centre stage the view that a democratic China poses less security challenges to America. As a result, the US sponsored security accords among its Asian allies in order to contain a perceived challenge to Americas national interest stemming from autarchic countries mainly China but without openly targeting Beijing for fear of alienating the indispensable Chinese market and jeopardising the US system of alliances in the region, given that most of the US Asian allies are increasingly dependent on the Chinese economy. The Obama administration has followed a similar approach towards the Asia Pacific, in a sign of continuity (and bipartisanship) of US foreign policy on these issues. The Ashton-Clinton statement released at the end of the ARF meeting in July 2012 can thus be seen as part of a broader US-led strategy aimed at keeping China in check and displaying the unity of the Western liberal-democratic family in advancing a set of fundamental values and principles to the Chinese Communist Party leadership. But while the West appears united over sending a message to Beijing, during the last ARF meeting a division emerged among South East Asian countries precisely on the same subject, i.e. what kind of approach to adopt vis--vis a rising and economically important but also increasingly assertive China?

US-china tussle and the emergence of competing camps

For the first time in ASEANs 45-year history, the foreign ministers of the 10-member bloc did not issue the traditional final communiqu which was expected this year to endorse the groupings position on a range of regional issues, most of all on the hotly debated topic of conflicting territorial and maritime claims between China and some members of ASEAN. As the South China Sea becomes Asias biggest potential military flashpoint, opposing positions seem to be hardening, with China and the US each playing their proxies off against one another in their struggle for regional supremacy. This time it was Cambodia that refused to allow the Philippines, supported by Vietnam (and unofficially by the US), to include a reference in a communiqu to a recent stand-off between Manilas naval vessels and Beijings ships over a reef claimed by both countries. It should be noted that Cambodia, the chair holder of the last ASEAN summit held in July 2012, depends largely on Chinese investments which are 10 times higher than US investments in
5. Guidelines on the EUs Foreign and Security Policy in East Asia (2012), point 20, p. 14.

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the country. Cambodia supported by other ASEAN members turned down the request by the Philippines on the ground that the question is a bilateral one which is Chinas policy line and that as such the 10-member bloc should not involve themselves. This episode is a glaring demonstration of the increasing divisions within ASEAN, as the blocs member states are increasingly torn between China and the US.6 Chinas rise is unsettling established power relations in the Asia Pacific, leading the US and its Asian allies to reassess their threat perceptions as well as overhaul their defence strategies and capabilities. Since 2010, Beijing has adopted a more assertive posture over territorial and maritime disputes with its maritime neighbours, including statements from representatives of the Peoples Liberation Army (PLA) that the South China Sea is now a core issue, giving the impression that the Sea is being elevated to the same strategic significance as Taiwan or Tibet.7 The US has responded with a policy of re-engagement to Asia, encapsulated in the notion of the US pivot pronounced by Barack Obama during his visit to the region in November 2011. This stance has been subsequently backed by the issuing of the US new Defense Strategic Guidance in January 2012 which includes plans to realign US forces and set up a new US Marine Corps base in Darwin, Australia, responsible for the South China Sea and the Indian Ocean. By increasing military bases near the ocean around China, Washington aims to boost deterrence against the Chinese armed forces which are currently strengthening their maritime presence. The tussle between the two powers for regional leadership has firmly set in and it is likely to intensify in the near future. Neither China nor the US are neutral actors in the South China Sea disputes.8 At the beginning of August, the US State Department issued a statement on the South China Sea which was strongly condemned by China afterwards.9 While Washington claims to take no side over disputes in the South China Sea, recent US initiatives give a different impression. A few days before the ARF meeting, Hillary Clinton, on a state visit to Cambodia, declared that Chinas approach to solving territorial disputes was a recipe for confrontation. The US Secretary of State was referring, among other things, to the decision by Beijing to create the new prefecture town of Sansha on the small island of Yongxing in the Paracels archipelago which is also claimed by Vietnam and the Philippines. The declaration by the US Secretary of State emboldened the government of the Philippines in its demands to include in the ASEANs final
6. On current US-China relations and growing misperceptions between the two see: Andrew J. Nathan and Andrew Scobell, How China Sees America: The Sum of Beijings Fears, Foreign Affairs, September/October 2012. 7. On this point see Michael Yahuda, Chinas Recent Relations with Maritime Neighbours, The International Spectator, Vol. 47, No. 2, June 2012, pp. 30-44. 8. Sam Bateman, Increasing competition in the South China Sea Need for a new game plan, RSIS Commentaries, n. 157/2012, 21 August 2012. See also Christopher Freise, By Invitation Mostly: The International Politics of the US Security Presence, China, and the South China Sea, RSIS Working Paper, 28 August 2012. 9. US State Department, South China Sea, press statement by Patrick Ventrell, Acting Deputy Spokesperson, Office of Press Relations, Washington D.C., 3 August 2012. For a Chinese reply see: China strongly opposes US State Departments statement on South China Sea, Global Times, 5 August 2012.

communiqu precise wording critical of China a move that was resisted by Cambodia, and as mentioned above, split the South East Asian bloc. The US pivot to Asia has been largely welcomed by Washingtons allies and partners in the region. At the same time, South East Asian countries in particular are increasingly worried about the growing geopolitical tussle between Washington and Beijing, including the risk for the region to see two competing camps emerge with potentially disruptive effects on economic growth and prosperity. This apprehension is not limited to South East Asia but extends also to the north east of the region. Japan and South Korea, the main US allies in the area, would also prefer not to have to choose between Washington and Beijing. While their security depends on the US, Tokyos and Seouls socio-economic development increasingly depends on the Chinese market (much like Europe in both regards). In this geopolitical situation, where economic and security interests do not necessarily overlap as they did, for example, during the Cold War and where the responsibility for diplomatic skirmishes and emerging tensions in the East and South China Sea lies in both camps, EU policy makers need to tackle the following question: does it remain in the longterm interest of the EU to be perceived as being closely aligned with the US in the Asia Pacific and renouncing the chance for its distinctive and more neutral voice to be heard?

in praise of closer EU-ASEAn relations

For many in Europe, the EU-27 lacks the capabilities and necessary cohesion to enforce its own vision in the Asia Pacific. As a result, for the EU-sceptics it would be wiser for the Union to either not play a role at all in the region a position recently put forward, for instance, by Jonathan Holslag 10 or if the EU were to decide to be more politically active in the Far East, it should do so in close coordination with its US ally. According to this view, the US pivot to Asia and as a corollary an EU alignment on US policy would provide the Union with the opportunity to raise its profile in the region without having to commit additional resources at a time of austerity and budget cuts across Europe. This is an understandable position. It needs to be kept in mind, however, that close alignment with the US in the Asia Pacific also entails the risk for the EU of becoming irrelevant in the region as well as forsaking the window of opportunity opened by the changing regional dynamics, in particular among the countries of South East Asia which are eager to welcome outside actors in order to balance off China and the US. There are mounting expectations from South East Asian leaders of more Europe, i.e. of an alternative voice coming from the West to diversify an otherwise emergent US-China duopoly that risks squeezing the smaller and weaker Asian countries
10. Jonathan Holslag, Europes convenient marginalisation, European Voice, 5 July 2012.

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between the two great powers and split the ASEAN grouping. Closer EU-ASEAN links would be a natural step for the EU. In fact, if Brussels were to have something like a natural political partner in the Asia Pacific, the ASEAN grouping would most probably be it. Both the EU and ASEAN share a commitment to regional integration as a means of fostering stability and prosperity and to multilateralism as a way to constrain unilateralism and hegemonic attitudes. Consequently, would it not be better for the EU to engage the ASEAN bloc more closely and support the smaller countries of South East Asia in their efforts to forge a unitary stance and raise their voice vis--vis a growing US-China tussle for regional leadership? Would such an approach not be more in tune with EU mission and foreign policy objectives of advancing effective multilateralism and opposing hegemonic attitudes, no matter where they come from? In order to be perceived as a neutral actor on Asian security affairs, including the disputes in the South China Sea, the EU needs not to take either the side of the US or China. The longterm strategic value of issuing another transatlantic statement similar to the one of July 2012 should therefore be questioned. Given that such an initiative by the US and the EU, while positive in its intention, could also be used by Washington in its diplomatic tussle with Beijing and be interpreted by the Asian countries as a sign of EU clear alignment on one side. Greater independence from its American ally would raise the EUs profile in the region and be in the long-term interest of the Union. This should be accompanied, however, by a firm position including autonomous declarations when necessary against Chinas assertive behaviour towards its smaller and weaker maritime neighbours, in order not to give the impression to South East Asian countries that greater political autonomy from Washington translates into pandering to the Chinese regime. A non-aligned position on the South China Sea disputes (where, it is important to recall, neither China nor the US are neutral actors) would be instrumental for furthering EU-ASEAN political links. Non-alignment could also create the conditions for the EU to initiate a dialogue with Beijing on Asian security and the South China Sea, providing the Union with an additional opportunity to advance a multilateral approach to finding a solution to the outstanding territorial and maritime disputes. An autonomous and balanced EU foreign policy in the Asia Pacific is even more necessary at this historical juncture, characterised by the existence of diverging interests, and views, between the EU and the US vis--vis China.

rising China can, however, be accommodated into Europes post-Cold War worldview. The EU has, in fact, indicated in the European Security Strategy its preference for a benign and cooperative multipolar international system whose modus operandi is multilateralism, with the United Nations playing a central role.11 Furthermore, for the EU and in particular the continental member states of Central and Western Europe that have been more active in promoting enhanced cooperation in monetary affairs and other fields the rise of China has been largely a boon. The Chinese government has supported the EUs integration process over the last decades including aspirations by the EU to play a bigger role in world affairs unwaveringly, and like no other international actor. Take for instance the case of the euro. While US policy makers had mixed feelings about the European common currency, worrying that its creation would weaken the global status of the dollar, the Chinese government supported it from the beginning, starting a process of diversification of its reserves that continues until today. Since 2011, China has begun disinvesting away in earnest from dollar-denominated assets and increasing its holdings of the euro.12 According to data from the US Treasury, while overall foreign demand for dollar securities has remained strong, the percentage of dollar holdings in Chinas foreign reserves (the worlds largest) has fallen to a decade-low of 54 percent in 2011 from 65 percent in 2010, with the trend for 2012 set to continue along this way.13 The main beneficiary of this diversification strategy has been the euro, which now accounts for around one-third of Chinas foreign reserves.14 Chinese support for the eurozone runs parallel with growing speculation from Wall Street-based international banks and hedge funds against the peripheral countries of the euro area. Speculative moves find suitable ground in the spiralling debt, domestic imbalances, and declining competitiveness in these countries. But the speculation is also directed against countries which are implementing important reform packages and with sound macro-economic fundamentals. The aim seems more and more to be the break-up of the eurozone in order to gain from a return of individual national currencies. These speculative moves have been accompanied by a repatriation of $250-300 billion from Europe back to America according to the specialised press15 A similar amount of money has, instead, been pouring into the euro area from the East, in particular from Chinese financial institutions. These flows partially explain why the value of the euro against the dollar has decreased but not plummeted.

the EU-china connection

For many in Washington, a rising China is the most ominous strategic challenge to Americas global primacy. This is a concern which is shared by many US allies in the region, most notably Japan which has traditionally vied with Beijing for regional leadership. For the EU, however, China is neither a potential enemy, nor a military threat though the non-democratic nature of the Chinese regime continues to be viewed with suspicion by EU policy makers and public opinions. A
11. European Council, A Secure Europe in a Better World: European Security Strategy, Brussels, 12 December 2003 (updated and revised in 2008). 12. Lan Shen, Stephen Green and Thomas Costerg, China: Less America, more Europe, Standard Chartered Global Research, 20 June 2011. See also: Jamil Anderlini and Tracy Alloway, Trades reveal China shift from dollar, Financial Times, Tuesday 21 June 2011, p. 1. 13. The Wall Street Journal, China looses appetite for dollar, 27 March 2012, p. 1. 14. Nicola Casarini, Chinas Approach to US Debt and the Eurozone Crisis, Chinas Geoeconomic Strategy, London: LSE IDEAS (Special report), June 2012, pp. 43-47. 15. See for instance: Patrick Jenkins, Tom Braithwaite, Dan McCrum and Tracy Alloway, US banks haunted by spectre of eurozone, Financial Times, 5 August 2012, See also Mary Watkins, US money market funds shun eurozone banks, Financial Times, 23 May 2012.

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Chinese support for the EU is not confined to monetary and financial issues. China has also backed Europes space ambitions, lending both political and financial support to Galileo, the EU-led global navigation satellite system alternative to the American GPS. When the European satellite system was launched, the US firmly opposed it for fear of a challenge to its space primacy and leadership in key strategic and hightech industrial sectors. China, however, actively supported the European project committing tens of millions of euro and becoming Galileos most important non-EU partner. For the EU and in particular the core members of Central and Western Europe more active in promoting integration China has been more of a strategic opportunity than a threat. In the last years a discourse of a Chinese economic challenge has, however, emerged in some EU member states based on the perception that China has been invading European markets with cheap products and taking away jobs in the manufacturing sectors. This view is strengthened by Beijings active industrial policy which is turning the country into a low-cost competitor in high-skill industries.16 The rapid growth of skillintensive imports from China represents a serious challenge for certain European industrial sectors that are considered sensitive. Moreover, it is widely felt in Europe that many Chinese sectors most notably the public procurement market are close to outside competitors, leading some EU policy makers such as Karel De Gucht the EU Commissioner for Trade to increase calls for greater reciprocity in EU-China relations. Nevertheless, the domestic politicisation of China, and the consequent linkage between commercial and security issues, has remained significantly less marked in the EU than in the US. Overall and besides the existence of an economic and trade challenge affecting some industrial sectors the majority of EU policy makers and public opinions have not bought into the China threat discourse coming from the more conservative quarters of the US and some of its Asian allies. This situation allows the EU to be better positioned than the US for further dialogue with China on security and defence-related matters, including discussion of regional (Asian) and global security issues. The recent visit by Ashton to China served precisely this goal, e.g. to foster ties between the EU and the Chinese military. On 10 July 2012, Catherine Ashton met with Dai Bingguo, State Councillor of the PRC, and General Liang Guanglie, the Chinese Defence Minister, in the framework of the third EU-China High-level Strategic Dialogue. The two sides discussed practical ways to enhance cooperation on international issues of mutual concern, including bolstering contacts between their special representative and special envoys. Moreover, the two sides agreed to hold a regular EU-China dialogue on defence and security policy.

China has made it clear several times and even inscribed it in the Chinas EU policy paper its commitment to engage with the EU on defence and military affairs, alongside similar dialogues that the Chinese government entertains with the most powerful EU member states.17 Catherine Ashton first met with the Chinese Defence Minister in October 2011. On that occasion, the Chinese side tested the EUs capacity to adopt a coherent position and speak on behalf of the 27 member states on issues which still remain a national prerogative. There was no guarantee at that time that Beijing would continue such a dialogue on a regular basis. The second meeting between Ashton and Liang stood thus as an additional recognition of the EUs post-Lisbon institutional arrangement, including expectations that the EU level will play a bigger role on security and defence policy in the future. It also signals a rather pragmatic take by the Chinese side on the question of the EU arms embargo currently shelved and with no solution in sight. The existence of an EU arms embargo on China has traditionally been viewed by leaders in Beijing as plain discrimination towards their country and one of the major obstacles for the full development of Sino-European political and military relations. The commitment by the two sides to continue their dialogue on defence and security policy can therefore be seen as a strategic achievement by those EU officials committed to avoiding that the arms ban stands in the way of closer EU-China political relations. Effective dialogue between the EU and the Chinese Defence Ministry is even more necessary at this historical moment. Since most of the more hawkish positions over territorial and maritime disputes in the East and South China Sea come from the Peoples Liberation Army, by engaging with the Chinese military the EU can use its weight to contribute to furthering a peaceful and multilateral solution to the ongoing disputes between Beijing and its neighbours. China has clearly indicated its preference for bilateral talks on the South China Sea disputes but has not ruled out the possibility of pursuing those negotiations in a multilateral setting, as preferred by the ASEAN members. Beijing has also declared that it would not accept outside actors such as the US, Japan, or India to play a role in the negotiations over territorial and maritime disputes, since these countries are considered by China to have too many vested interests in the region. The EU, instead, can present itself as a more neutral actor on the South China Sea disputes, in particular if it is able to show more autonomy from Washington. The experience of the EU in brokering peace negotiations and settling disputes could be used to find a compromise between ASEANs and Chinas positions on the South China Sea. A regular dialogue with Beijing on defence and security policy, including discussions on Asias main flashpoints, could well parallel EU-US dialogue and cooperation on the Asia Pacific region. In this way, the EU would have more opportunities and leverage to play a constructive diplomatic role in building initiatives for reducing emerging tensions in the region.

16. See on this point Jonathan Holslag, Unravelling Harmony: How Distorted Trade Imperils the Sino-European Partnership, Journal of World Trade, Vol. 46, No. 2, April 2012, pp. 221-238. 17. Chinese Ministry of Foreign Affairs, Chinas EU Policy Paper, Beijing, October 2003.

conclusion: striking the right balance

EU foreign policy in the Asia Pacific is set to face both opportunities and challenges over the next years, in particular in relation to the US, China and ASEAN. They include: (a) The opportunity coming from closer EU-US cooperation on the Asia Pacific region to advance joint interests as well as a set of principles and rules dear to Western public opinions. At the same time, the EU needs to increase its autonomy from Washington in order to avoid giving the impression to be too closely aligned with the US and risk becoming irrelevant. EU autonomy from Washington is also necessary to enforce a position that acknowledges the existence of diverging interests (and views) between the transatlantic allies vis--vis a rising China; (b) The opportunity for further dialogue with the Chinese military on defence and security policy, accompanied by the challenge for the EU to maintain a critical attitude towards the Chinese regime and the more nationalistic postures of the PLA; (c) The opportunity to exploit the demand for more Europe coming from South East Asian nations eager to welcome outside actors to balance off China and the US. With this comes the challenge for the EU to devise an autonomous position on the South China Sea disputes and to try to remain equidistant from the US and China, resisting in particular pressures coming from Washington to take its side. In light of these opportunities and challenges, it is clear there is a need for the EU to devise a strategic vision for the region based on a balanced approach between the US, China and ASEAN. Such an approach would better contribute to the promotion of the Unions interests and values as well as advance the EUs mission of promoting multilateralism and opposing hegemonic attitudes. -

be the most likely issue of contention between the transatlantic allies, the establishment of an EU-US high-level strategic dialogue on China could help the two sides increase mutual understanding and avoid misperceptions, as well as help the EU explain to their American counterparts its own and eventually distinctive position; Foster relations with China on defence and security policy and consider establishing an EU-China dialogue on Asian security. The EU should use its soft power and nonthreatening image to engage Beijing on security issues, including in defence and military-related policy fields. EU dialogue with the Chinese military should be used to identify areas for cooperation on international security issues of mutual concern as well as further a peaceful and multilateral solution to territorial and maritime disputes in the East and South China Sea. Engagement with the PLA presents an additional opportunity for the EU to play a constructive diplomatic role in building initiatives for reducing tensions in the region. Yet, building links with the Chinese military also necessitates the setting up of an independent EU capability to assess and monitor military developments within the Peoples Republic of China (and in the region) in order to be able to effectively entertain a dialogue with Beijing on hard security matters; Boost political links with ASEAN and consider establishing an EU-ASEAN dialogue on the South China Sea. Recent events have contributed to changing the image of the EU in the region in a favourable direction. The attendance of Catherine Asthon at the last ARF meeting, for instance, put an end to two years of the Unions glaring absence from the foremost intergovernmental dialogue forum for the promotion of cooperative security in the Asia Pacific. There is now demand for an increased EU role to help the ASEAN grouping to find a balance between China and the US. The EU could seize on this opportunity window by considering the establishment of a regular EU-ASEAN dialogue on the South China Sea. This could allow the Union to promote further its model of peaceful regional integration and accompany it with backing for the weaker countries of South East Asia, promoting a multilateral perspective and trying to limit the growing US-China jostling for regional supremacy that risks creating competing camps.

The EU could, in particular:

Continue close consultation with the US on the Asia Pacific and consider establishing a EU-US high-level strategic dialogue on China. The EU needs to acknowledge the unique role of the US in guaranteeing the security of the Asia Pacific region, but it also needs to recognise that Washington has its own agenda which is not necessarily always in the best interest of the EU. There is need for Brussels to develop its own independent assessment of dynamics in the Asia Pacific and adopt in particular situations and when needed an autonomous position. This position may often be in line with that of the US, but at other times not. The ability by the EU to show independence from Washington will be the litmus test for EU foreign policy in the Asia Pacific. Since China might

Were the EU able to find the necessary internal strength to devise a more autonomous, and neutral, course of action in the Asia Pacific, full membership of the East Asian Summit (the main institutional forum for discussion of Asian affairs) may become a serious possibility. With an increased EU political presence in the Asia Pacific, there is also a greater prospect for the EU model of interstate relations to take root more vigorously in a region still beset by competing nationalisms and balance-of-power logic.