On June 13, 2006, the Carnegie Endowment for International Peace hosted a talk by China Program Visiting Scholar Joshua Kurlantzick entitled “China’s Soft Power in Southeast Asia: What Does It Mean for the Region, and for the US?” The event was held in conjunction with the release of a Policy Brief by Mr. Kurlantzick called “China’s Charm: Implications of Chinese Soft Power.” Carnegie’s Minxin Pei moderated the discussion. A summary of the event follows.

In his remarks, Mr. Kurlantzick analyzed China’s increasing use of soft power in Southeast Asia. He argued that during the 1990s, China’s economic growth and its recognition of the failure of aggressive policies toward Southeast Asia contributed to the growth of a more proactive foreign policy. China’s enthusiasm for bilateral agreements and regional multilateral organizations has improved its image as a benign power. In addition, China has portrayed its system as a model of economic development by which countries can decrease poverty and increase economic growth, even as the leadership maintains its power.

China has exhibited these soft power tendencies through its use of Official Development Assistance (ODA), successful public and formal diplomacy, and the use of economic and political tools such as investment and regional trade agreements. The rise of China’s soft power has also benefited from the decline of U.S. soft power in the region, due in large part to America’s perceived over-emphasis on the war on terror and the accompanying changes in its foreign policy.

By engaging in this soft power strategy, China hopes to promote its image as a benign power, while reducing Taiwanese and American regional influence. By these criteria, China’s strategy has proven successful. Regional trade is skyrocketing, without the criticism leveled at China in the West. The popularity of Chinese language and cultural studies has grown immensely and visiting Chinese elites receive a warm welcome in the region. The status of ethnic Chinese citizens in many Southeast Asian countries has markedly improved.

China’s willingness to mediate disputes in the region and to accept a role as a regional leader on drug and human trafficking has proven to be a benefit of China’s new policies. Its regional trade efforts have prompted Southeast Asia to think of itself as a regional bloc, a development the United States has been trying to encourage for years. But China’s increasing presence in Southeast Asia also means the spread of businesses with poor environmental and labor regulations and little accountability. The availability of Chinese aid and diplomatic attention limits the ability of other donor countries to encourage democratization and good governance in exchange for their aid. Furthermore, in the long-term, China may be able to create a China-centered regional order that weakens the influence of the United States.

In order to protect its position in Southeast Asia, the United States needs to improve its public diplomacy by encouraging its diplomats to specialize in the region and build long-term regional contacts, as the Chinese have proven adept at doing. The values of democracy and human rights regime are still appealing to Southeast Asians, but the United States must live up to these ideals. Nevertheless, the United States still enjoys unchallenged hard power in the region and an attractive popular culture.

Question and Answer Session

Q: In which Southeast Asian countries are there natural limits to the extent of China’s influence, and in which will China’s influence be greater? In which countries is the process described just a final step in the normalization process?

A: There are three categories of countries in Southeast Asia. The first is those countries that border China, with the exception of Vietnam. These countries must deal with China because they share a border, because they have a significant business or political elite that is engaged in a relationship with China, or because they lack leverage against China. These countries are Burma (Myanmar), Thai, Laos, and Cambodia.

The second group of countries is those that have long-standing relations with China, and so cannot be said to be finishing the normalization process. These countries do not border China, still have domestic issues between ethnic Chinese and other groups, or have a historical relationship with the United States.

Finally, there are two countries that are outliers. Singapore could also be listed in the second group, but is distinguished by its masterful diplomacy, which means that it is unlikely to be taken in by any country. Vietnam is an exception because of the continuing impact of its 1979 border war with China and its complex relationship with the United States. Nevertheless, Vietnamese leaders are still trying to learn from the Chinese model of economic development.

Q: How did Japan lose so much influence in the region?

A: The immediate impact of China’s increasing influence in Southeast Asia is on Taiwan and Japan. It is felt only secondarily by the United States. Japan is harmed by the perception that its Ministry of Foreign Affairs is lacking in comparison with Chinese efforts. Additionally, there is a perception that Japan is moving in a direction that will lead to poor relations in Northeast Asia.

In order to understand Japan’s behavior, Southeast Asians should recognize that the Japanese Ministry of Foreign Affairs moves slowly. Japan does not publicize some of the substantial aid to the region that it provides. Furthermore, the United States has pushed Japan to leverage itself in the region as a democracy. This connection with the United States sometimes has negative effects, and Japan is not entirely comfortable in this role.

Q: Some people argue that China is actually using traditional trade-craft and diplomacy in a very soft manner, rather than engaging in Joseph Nye-style soft power. Do you agree?

A: While it is true that China’s trade-craft is sophisticated, there are also signs of some of Joseph Nye’s soft power. Since the Asian financial crisis, most Southeast Asian countries have wanted to balance economic reforms with a culture and society that feels right to them. This has increased the allure of China’s model of economic development. China is perceived as an alternative to the West, and especially to Japan.

Q: Why does China consciously prefer the use of soft power over hard power in Southeast Asia?

A: Chinese foreign-policy elites recognize that the United States holds unparalleled hard power in the region and in the world, and that it is fruitless to engage on that front for now. They also acknowledge the failure of their efforts in Mischief Reef, for example. More recently, the Chinese saw how quickly the United States was able to move into Afghanistan and Iraq.

Q: In what situations are the diplomats China dispatches to regional meetings more senior than the American diplomats in attendance, and in what situations are the Chinese diplomats dispatched less senior?

A: In contexts such as the Shangri-La Dialogue, which is focused on military and defense issues, the United States still wields major influence and the U.S. officials who attend are more senior to the Chinese in attendance. But China capitalizes on other events, such as the meeting in Thailand on the development of an early warning system for tsunamis, in which the United States has less interest.

Q: What are the implications of these trends for relationships between ethnic Chinese and non-Chinese in countries like Thailand, Malaysia, and Burma (Myanmar) where there has been historical tension between ethnic groups?

A: It’s a double-edged sword. On the one hand, restrictions have been lifted in countries like Thailand, where ethnic Chinese were formerly hindered from entering government. Relations between ethnic Chinese and other groups are as good as they have been in a long time. But in the long-term, if the Chinese companies that have a presence in Southeast Asia cause labor or environmental problems there may be a backlash – not against the ethnic Chinese citizens, but against the Chinese migrants.

Q: Will the recession of U.S. influence in Southeast Asia harm the interests of Western multinationals?

A: Yes. For example, in terms of the oil and gas industries, Western technology is still more advanced than that of Chinese companies. But Chinese companies have cheaper labor costs and have less security concerns than Western countries. Moreover, the Chinese government can offer aid and soft loans to Chinese companies that would be illegal in, for example, the United States. Once Chinese companies catch up technologically, the position of Chinese multinationals relative to Western multinationals will improve greatly.