국제코리아재단

Abstract: This paper discusses China’s East Asia strategy and examines an emerging dual leadership structure in the Asia-Pacific. China and the

U.S.

have entered into a new structure with regards to leadership in the region. The rising power (China) plays a leadership role in the economic and financial dimensions, while the existing hegemon (U.S.) plays a leadership role in the military, security, and political dimensions. As China emerges as a regional power of East Asia, co-management with the U.S. of crucial economic, security, and political issues - including such “hot spots” as the Taiwan Strait and the Korea peninsula - will be essential for regional stability and prosperity. In this dual leadership structure, cooperation and bilateral talks have been positive so far. It remains to be seen as to whether the U.S. and China can extend this leadership structure into regional institutions, as well as how well it will be able to work with other key players in the region, such as Japan, Russia, the two

Koreas

, and ASEAN.

When examining China’s strategy toward East Asia, one may have to notice the most recent new power configuration in the Asia-Pacific. Since the beginning of this century, a new pattern of leadership has emerged with regards to Asia-Pacific international relations. In the economic and financial dimensions, China has gradually gained the upper hand and begun to play a leading role in certain dimensions, but, as Robert Sutter argues, in terms of military, security and political influence, the United States continues to be in a hegemonic position—far ahead of the rest of the major powers.[1] This emerging dual leadership structure clearly reflects new configurations related to the rise of

China

for the past three decades. At the same time, it is also a reflection of the continued

U.S.

leadership position in world affairs since the end of World War II.

The dichotomy between economic and military dimensions can be also found in public perceptions. This is exemplified in a recently released PEW Research Report on American perceptions of

China

’s influence. According to this study, “nearly half (47%) of Americans see China as the world's leading economic power, while 31% say the United States holds that position.” It also indicates that, as recently as 2008, the perceptions of these two countries were reversed. At that time, 41% named the U.S. as the world’s leading economy power while only 30% named China.[2] A similar survey by Gallup (see Table 1) revealed same perception changes in this regard.

This perception is due to the fact that China moved through the economic crisis fairly successfully, whereas the U.S., Japan, and the EU all suffered substantially, creating a noticeable gap between public perception and reality. That is to say, in the economic and trade dimensions, many people pay more attention to what China has to say, and as such China has increased its decision-making role in international organizations such as the World Bank and International Monetary Fund (IMF.) In March 2011, the IMF passed a resolution to increase the voting power of China within the IMF, making it the third largest member country.[3] This is even more prevalent in the Asia-Pacific due to the fact that virtually all surrounding economies have increased their dependence on China’s financial and trade markets (See below for a more detailed discussion.)[4]

This new development of leadership is an important step in power transition in contemporary international relations. Power Transition Theory focuses on the relationship between the rising power and the existing dominant power, in particular on how the dominant power deals with the rising power’s assent. One of the key elements to a peaceful transition rather than a drastic confrontation is the degree of satisfaction the rising power has with the existing international system. The probability of conflict is greatest when the relationship can be characterized as a “zone of contention and probable war.”[5] History has shown that when a rising power challenges the dominance of an existing hegemon, it could mean a war, or a peaceful transition.[6] Some examples of peaceful transitions can be found in recent history, including the transition of power from the United Kingdom to the

United States

in the late 1800’s. According to Robert Kagan, “the most successful management of a rising power in a modern era was Britain’s appeasement of the United States in the late nineteenth century, when the British effectively ceded the entire Western hemisphere (except

Canada

) to the expansive Americans.”[7] An example of a situation which escalated into war is Japan’s challenge to

China

’s dominance during the Meiji period through the beginning of World War II. Another rising power of the time was Germany, which challenged the UK’s existing dominance in Europe. [8]

The dual leadership structure has emerged as a means of mediating the process of power transition, as well as facilitating cooperation between the U.S. (the dominant power) and

China

(the rising power.) Both positive cooperation and potential conflicts have increased in recent years. The change in leadership structure in the region is not only conducive to the coordination between the two countries, but also to cooperation with other key players in the region such as Japan, Russia, the two Koreas and ASEAN, so that a disastrous military confrontation will be avoided.

In general, a country in a leadership position in international affairs should possess at least the following five elements:

· it should have ability to deliver and provide public goods in both peace and crisis times;

· it should occupy a leadership position in major international organizations such as the United Nations and the World Bank; and

As will be seen from analyses below, China and the

U.S.

each have their own strengths and weaknesses in different dimensions.

In a dual leadership structure, coordination and cooperation between the two leading powers is the key element for successful leadership. Some international relations experts have also theorized on the subject. According to Robert Keohane, “Cooperation…requires that the actions of separate individuals or organizations…be brought into conformity with one another through a process of policy coordination.” He goes on to say that “this means that when cooperation takes place, each party changes his or her behavior contingent on changes in the other’s behavior….Genuine cooperation improves the rewards of both players.”[9] Cooperation, or both powers putting forth the effort to achieve an agreeable situation, should not be confused with harmony. Keohane’s theoretical framework for cooperation also distinguishes the difference between the cooperation of powers and harmony among powers. According to Keohane, “harmony refers to a situation in which actors’ policies (pursued in their own self-interest without regard for others) automatically facilitate the attainment of others’ goals. …Where harmony reigns, cooperation is unnecessary.”[10] In the case of the U.S. and China, cooperation is necessary and will be key to the ongoing process of power transition.

We have seen in the post-Cold War era the establishment of cooperation among capitalist powers in the form of a security community. This post-Cold War international order demonstrates how cooperation can function among global powers. According to William Olson, “the dominant feature of the post-Cold War era is a security community among the major centers of capitalist power. This means a group of states that do not expect, or prepare for, the use of military force in their relations with each other.” [11] This emergence of a security community facilitates the ease with which these powers can act upon security threats. As Barry Buzan argues, the “relative ease with which the United States was able to construct a military (and financial) coalition to take on Iraq shows both the potential of such a security structure and how it might work to meet other periphery challenges to the stability of the global political economy.”[12]

With regards to the emerging dual leadership structure in the Asia-Pacific, cooperation between the U.S. and China is imperative. According to James Dougherty and Robert Pfaltzgraff, “cooperation may be the result of a relationship between a stronger actor and a weaker party.”[13] In this case, though there is still an enormous gap in development between the U.S. and China, the two countries are moving toward a parity in which cooperation is key.

When talking about the “leader,” we must also discuss the “led,” whether they are led reluctantly or forcibly. In the sense of the dual leadership structure, the leadership position is neither self-appointed nor elected; it is naturally formed. In most cases, these terms apply only in a relative sense. Generally speaking, great powers often have followers (or “free riders”), but from a macro perspective, some countries have more followers in certain dimensions. In this situation, each country may be regarded as a leader in particular dimensions.

More importantly, the emergence of this dual leadership is regional: specific to the Asia-Pacific and not necessarily dominant on the global stage. Therefore, we should not think of this new leadership structure as the same as the G2 proposition--that global governance should be led by the U.S. and China.[14] Additionally, this dual leadership is different from the Cold War era zero-sum game. Rather, it indicates that two great powers continuously coordinate and compromise, and, on many occasions, jointly assume a leadership role. Therefore, this new leadership structure is more related to methods for conflict resolution. It reflects a dichotomy of economic versus military backlash and political influence to reach a win-win solution, rather than a zero-sum game.

It is in the economic dimension that we can see the biggest reflection of a changing world configuration. For the past few decades, the center of world economic activities has gradually shifted from the Atlantic region to the Pacific region. Following Japan’s example from the 1950s to the 1980s, China’s economy has grown at an unprecedented rate. In 2010 China’s Gross Domestic Product (GDP) bypassed Japan’s to become the second largest economy in the world.[15] China’s rising economic position in relation to the rest of the world is illustrated in Table 2 below.

This is a significant change in world affairs, and China’s development momentum continues to be strong despite many speculations that the Chinese economy could collapse within the next three to five years.[16] There are also a variety of predictions, including perceptions of the American public, that China will overtake the United States and become the number one economic powerhouse in the near future (this is unlikely; even the most optimistic estimates say it will take another twenty years for China to catch up with the United States economically).

On the other hand, when comparing the Chinese economy with that of the United States, there are still enormous gaps in terms of economic power. For example, China’s GDP is less than 40% of the United States’ GDP, and its GDP per capita is more than thirteen times smaller than the United States’ (2009 figure). Moreover, nobody would deny that China has daunting domestic problems, such as a potential economic bubble, environmental damage, social unrest, and corruption, to name a few, that may slowdown and even set back its economic development. Also, China has had far less influence in international organizations such as the World Bank, among others. If this is the case, why do we say China plays a leadership role in regional economy in Asia-Pacific?

First, the speed of growth of China’s economy is much higher than the speed of growth in the United States. For the last 30 years - from 1980 to 2009 - the average growth of the United States’ GDP has been 2.7% annually, while China’s average GDP growth has been 10.01% annually.[17] Next, in the process of economic recovery after the financial crisis of 2008, China played a primary role. The world’s GDP is heavily dependent upon China’s GDP growth and investments.[18] China is also the world’s largest creditor: it owns 20.8% of all foreign-owned U.S. Treasury Securities, as shown in Table 3 below.

Source: http://www.treasury.gov/resource-center/data-chart-center/tic/Documents/mfh.txt

When referring to the financial and monetary dimensions, China has the largest share of foreign reserves, bigger than both Japan (number two) and ASEAN (number three) combined (see Table 4).

http://www.safe.gov.cn/model_safe_en/tjsj_en/tjsj_detail_en.jsp?ID=30303000000000000,19&4

http://www.ethailand.com/news/asean-considering-utilising-foreign-reserves-27676.html

Furthermore, China has bypassed the United States and has become the number one trading partner for many countries in the region, including Japan, South Korea, India, ASEAN nations, and Australia (see Table 5).[19] The U.S. is the number one trading partner with only its two neighbor countries, Canada and Mexico. East Asia, Southeast Asia, Oceania, and South Asian countries increasingly rely on China as a trading partner, and it has also become one of the most important trading partners world-wide.

Country	#1	#2	#3	#4	#5	#6	#7
China	USA	Japan	Hong Kong	S. Korea	Taiwan	Germany	Australia
S. Korea	China	Japan	USA	Saudi Arabia	Hong Kong	Australia	Singapore
Japan	China	USA	S. Korea	Taiwan	Australia	Thailand	Germany
Hong Kong	China	USA	Japan	Taiwan	Singapore	S. Korea	Germany
ASEAN	China	EU	Japan	USA	S. Korea	Hong Kong	Australia
USA	Canada	China	Mexico	Japan	Germany	UK	S. Korea
Canada	USA	China	UK	Mexico	Japan	Germany	S. Korea
Mexico	USA	China	Brazil	Japan	Germany	Chile	S. Korea
India	China	USA	UAE	Saudi Arabia	Germany	Singapore	UK
Australia	China	Japan	India	South Korea	USA	UK	New Zealand

S. Korea: http://topforeignstocks.com/2010/11/11/the-top-trade-partners-of-south-korea/ and http://www.state.gov/r/pa/ei/bgn/2800.htm

Mexico: http://www.economywatch.com/economic-statistics/Mexico/Trade_Statistics/

China has also retained its second-place position as a destination for foreign direct investment (FDI), after the United States (see Table 6).

Source: http://www.google.com/publicdata?ds=wbwdi&met=bx_klt_dinv_cd_wd&idim=country:CHN&dl=en&hl=en&q=china+foreign+direct+investment

China’s FDI outflow (Table 7) has noticeably increased in recent years, particularly in developing countries. Although it is still far behind the U.S., the trend indicates that China’s FDI is increasing quickly - especially if Hong Kong’s contribution is included in China’s overall FDI outflow.

For example, China has become a leading investor in Africa, particularly in infrastructure, development, and other projects.[20] According to a Financial Times article, “the China Development Bank and China Export-Import Bank signed loans of at least $110 billion to other developing country governments and companies in 2009 and 2010. The equivalent arms of the World Bank made loan commitments of $100.3 billion from mid-2008 to 2010, itself a record amount of lending in response to the financial crisis.”[21]

One other factor that has facilitated China’s world trade in recent years is growing Asian regionalism. China is establishing a substantial list of bilateral and regional Free Trade Agreements (FTA), including the ASEAN-China Free Trade Area (ACFTA), which was put into effect in 2010; the Mainland and Hong Kong Closer Economic Partnership Arrangement (CEPA), which went into effect in 2003; the China-Pakistan Free Trade Agreement, in effect as of 2007; the New Zealand-China Free Trade Agreement, as of 2008 and the Taiwan Economic Cooperation Framework Agreement (ECFA), a significant step in the bilateral cooperation between China and Taiwan, which went into effect in early 2010.[22]

In sum, China exerts significant regional influence, as other Asian countries depend on China both for investments and as an important trading partner. As Table 8 indicates, China is closing the gap between it and the U.S. China is catching up to the United States economically through its increased importance as a trading partner to other countries, large holdings of U.S. debt and foreign exchange, and levels of FDI outflows.

http://www.safe.gov.cn/model_safe_en/tjsj_en/tjsj_detail_en.jsp?ID=30303000000000000,19&4

http://www.ethailand.com/news/asean-considering-utilising-foreign-reserves-27676.html

Although China’s economic power is still far behind the United States, as it continues to grow economically, the Asia-Pacific region has begun to look to China as a primary economic leader.

U.S. Leadership Role— Military Security Dimension and Political Influence

In the military, security, and political spheres, the United States has undoubtedly maintained an absolute advantage. As we can see from Table 8, U.S. military expenses in 2009 reached $663 billion U.S. dollars, which constituted 46.5% of global military expenditures.[23] Although China is regarded as the second-largest power in terms of military spending, it only spent $99 billion U.S. dollars, constituting 6.6% of the world total.[24]

Furthermore, over the years, U.S. military expenses have been maintained at 4% of its total GDP for the past few decades, whereas China has maintained average military expenditures of 2% of its GDP (see Table 9). This number (2%) has made it virtually impossible for China to close the gap with the United States militarily in the foreseeable future. The United States also contributes the largest percentage of arms transfers worldwide (Table 10).

More importantly, if we look at international organizations and institutions related to military and security in the Asia-Pacific, most of them are under the control of the United States. This includes U.S.-led bilateral security institutions such as the U.S.-Japan security alliance and the U.S.-South Korea military alliance. This also comprises military partnerships between U.S. and Asian countries such as the Philippines, Australia, New Zealand, Thailand, India, Pakistan, and Singapore, as well as Taiwan. Table 11 below shows these relationships in more detail. The United States has also developed close security ties with other regional powers, such as Vietnam and Pakistan.

The most substantial military relationships the United States has in the region are its alliances with Japan and South Korea. The U.S., for example, has participated with South Korea in joint military exercises since the 1970s, including the annual exercise entitled Ulchi Focus Lens, which is a computerized South Korean defense from North Korea.[25] Operation Team Spirit was a periodic exercise between 1976 and 1997.[26] In 2010, four different joint military exercises occurred, including Invincible Spirit, North Korean naval deterrence, anti-submarine exercises, an eleven-day war deterrent exercise and scheduled military drills following the shelling of Yeonpyeong.[27] The U.S. participates with Japan in over 100 joint military exercises annually, as well as leading the “Peace-09” Naval exercise (which also included China)[28], and naval exercises following the shelling of Yeonpyeong in 2010.[29]

Perhaps the only similar initiative on the Chinese side is the Shanghai Cooperative Organization (SCO)[30], in which both China and Russia play leadership roles in Central Asia in the field of regional security. Similarly, in Northeast Asia the only example available is the Six Party Talks designed for the North Korea nuclear crisis, in which the U.S. and China both play a leadership role.

Although the United States remains the dominant military power globally, China has noticeably increased its defense budget and spending in the past few decades. From 1978-1987, China’s military budget increased 3.5% annually; from 1988-1997 it increased 14.5% annually; and from 1998-2007 it increased 15.9% annually.[31] China is now the second-most powerful nation in terms of military expenditures globally. As one can see, China has rapidly expanded its military power and increased its military expenditures.

Overall, it is clear that in the military-security arena, the U.S. not only occupies an absolute leading position in terms of military capability and equipment, but also has many more partners and followers than China. This kind of leading position is not likely to be altered anytime soon, even if the Chinese economy should bypass that of the United States in 2030 (as projected).[32]

The gap in political influence between the United States and China is equally noticeable. This is not only because the U.S. is still the only superpower in world affairs, but also because Washington has always paid close attention to soft power, and most recently “smart power” (a phrase used by U.S. Secretary of State Hillary Clinton).[33] Specifically, the U.S. has the following four advantages in terms of its soft power diplomacy:

1. It always adjusts its foreign policy in order to reflect a high moral stance.

3. It strengthens its international credibility to maintain alliance relationships.

4. There is a constant public debate over domestic and foreign policy, creating a strong ability to self-correct, and therefore avoiding disastrous consequences caused by foreign policy errors.

One may also remark that there is widespread anti-Americanism in the world as well, and each country has its strengths and weaknesses. However, in general, the U.S.’s soft power and political influence is much stronger than China’s, particularly in terms of influencing news media and public opinion and exercising political leadership.

Despite China’s repeated claims of its intentions of a peaceful rise and its pursuit of a harmonious world, both the West and China’s neighbors still have deep suspicions with regards to China’s intentions. China’s rise is sometimes seen as a threat to its East Asian neighbors as well as the global political order. Therefore, the soft power issue has become a sore spot in Chinese foreign policy. Moreover, this also damages China’s core interests. For example, China has repeatedly announced that the areas of Taiwan, Tibet, and Xinjiang are a part of its core interests. However, in the West public opinion still reflects a lack of understanding of China’s basic positions, and sympathies of political forces most often oppose the Chinese government’s position. [34]

China’s rise has been scrutinized globally, with some experts predicting conflict with other great powers such as the U.S. The promotion of China in a “peaceful rise” has been critical to China’s influence and reputation within East Asia as well as the rest of the world.[35] Some of the ways China promotes its soft power are sending doctors and teachers to work abroad, welcoming foreign students to study in China, and setting up Chinese language institutes and language program initiatives abroad. But, this soft power “charm offensive”[36] has produced rather limited influence. A survey on international public opinion (Table 12), for example, indicates that favorable opinion of the U.S. remains much higher than that of China, without any signs of China closing the gap.

We can look to South Korea as an example to demonstrate the U.S.’s reining political influence in the Asia-Pacific. A survey conducted in South Korea in 2009 by the Chinese Academy of Social Sciences indicates that, when asked for a prediction as to who they thought would dominate the international stage in the year 2030, over half predicted that China would dominate while only 28% predicted the U.S. (Table 13).

Age Group	USA	China	EU	Japan	Don't Know	Total
19-29	33.3	41	22.4	3.3	0	100
30-39	23.9	54.1	18.9	2.7	0.5	100
40-49	23.8	58.9	13.4	2.2	1.7	100
50-59	32.5	55.8	9.8	0.6	1.2	100
60+	25.9	58.6	6.3	2.3	6.9	100
Total	27.6	53.5	14.7	2.3	1.9	100

*note- Question posed: Which region/country would you anticipate dominating the international stage in 2030?

However, other answers show that South Koreans generally prefer the U.S.-South Korean military alliance over the economic influence and/or benefits of China. As Table 14 indicates, if one looks at South Koreans’ views on the trustworthiness of other nations, with Japan held at a constant score of 50, then the U.S. received an average score of more than 60, while China received 40. This is quite alarming to China as it is not only much lower than the U.S., but also lower than Japan (which colonized Korea during most of the first half of the 19^th Century).

*note- Question posed: On a scale of 0-100, what number would you assign as to the trustworthiness of the US/China, with Japan's trustworthiness rated at 50?

According to the poll regarding South Korean views on war time alignments (Table 15), hypothetically if there were to be a military confrontation between the U.S. and China, more than two-thirds of Koreans would prefer that their country remain neutral, 31% of those polled would prefer to side with the U.S., and only 2% would prefer to side with China. This data indicates that on the whole, South Koreans clearly follow the U.S. militarily and politically.

*note- Question posed: In the event of a conflict between the US and China, what should South Korea do?

Now when we look at regional institutions and organizations, there are four primary categories of regional institutions in Asia: (1) U.S.-led institutions (i.e. the U.S.-Japan alliance, U.S.-South Korea alliance, and the Trans-Pacific Partnership); (2) China-led institutions, which are mainly economic institutions (i.e. SCO, FTAs); (3) U.S.-China Co-leaders (i.e. the Six Party Talks); and (4) U.S.-China Co-participants (i.e. APEC, ASEAN Regional Forum, East Asian Summit, etc.).

As indicated at the beginning of this paper, the dual leadership position reflects a natural development process. This not only reflects the reality and core national interests of China and the United States, but also the responsibilities of the two great powers. Ultimately, the future development of this newly emerged structure will depend upon whether it serves the interests of China and the United States as well as major players in the region, such as Japan, Russia, the two Koreas, and the ASEAN countries. Therefore, close coordination with those countries is not an issue of willingness, but an issue of necessity.

Dual leadership structure by definition indicates that each power has its strengths and weaknesses. As was stated previously, in the economic dimension China gained momentum, and moved into the upper hand position, whereas in the dimensions of military and political influence, the U.S. is still much stronger than China.[37] The two powers need to constantly adjust to, and support, one another. Each should be prepared to make compromises in their weaker areas, and to be more proactive and willing to assume a clear leadership role in their stronger areas. As it is often said, one cannot totally divide politics from economics, so the two issues should be well-coordinated. Therefore a “3-C” principle will become necessary, namely coordination, cooperation, and compromise between China and the United States.

That 3-C spirit is reflected in a notion that I raised in a previous paper, “co-management of great powers.” This concept argues, “the two countries need to find accommodating ways, such as mutual acknowledgment of each other’s core interests, that allow the two countries to exist as ‘stakeholders’.” [38] In another article entitled “Managed Great Power Relations,” I discussed two “Hot Spots for Conflict”: the Korean Peninsula, in which Beijing and Washington followed a policy of “explicit co-management” and pursued Six Party Talks, and the Taiwan Strait, where the two powers followed a policy of “implicit co-management.”[39] In this article, I am talking about co-management of the overall Asia-Pacific regional structure, not just the co-management of the two “hot spots.” As discussed at the beginning of the paper, according to the power transition theory, the most dangerous period is when the dominant power and the rising power reach a point of parity, which may lead to confrontation. In that sense, the most important task for Washington and Beijing is to further enhance communication and coordination between the two countries.

Different perspectives of international relations can help us examine whether China’s rise will result in a zero-sum game or a ‘win-win’ situation. According to an offensive realist perspective, the strategic environment facing China and the United States is a zero-sum game. According to this perspective, there is little room for shared power - especially militaristic - and China’s rise is a threat to the United States. As John Mearsheimer argues, “The most dangerous scenario the United States might face in the early twenty-first century is one in which China becomes a potential hegemon in Northeast Asia. China and the United States are destined to be adversaries as China’s power continues to grow.”[40] Indeed, there are some significant points of contention between China and the United States in which the two powers may come into conflict even military confrontation, such as U.S. arm sales to Taiwan, and issues related to South China Sea, East China Sea, among others.

In comparing broader common and overlapping interests, namely regional stability and prosperity, the two powers should be able to handle their differences through peaceful means. To this end, they need to avoid conflict and further develop crisis prevention and crisis management mechanisms and institutions. According to the win-win perspective, China’s rise could be good for both the United States and for China. Interdependency theory explains that as long as relations between major powers can be managed, conflict is not inevitable. Additionally, growing globalization and regional integration may result in greater economic interdependence. We can see many examples of instances in which China and the U.S. currently cooperate. For example, the China- U.S. Strategic Economic Dialogue began in 2006 and currently occurs bi-annually, in Beijing and Washington.[41] Additionally, we see frequent summits and state visits, such as President Obama’s visit to China in November 2009, Hu Jintao’s visit to Washington in January 2011. Moreover, the co-management concept also refers to inclusion rather than exclusion. Namely, China and the United States should work together with all related powers, such as Japan, Russia, and Korea.

The Dual Leadership Structure has proven positive so far, with benefits for both the United States and China. However, it remains to be seen whether the two powers can coordinate well with other powers of the region, such as Japan and Russia. One possibility is that some regional mechanisms, such as the Six Party Talks, might be institutionalized so that all major players can be included.[42] Additionally, China and the U.S. may expand existing institutions and alliances to officially or unofficially include each other. Each side should be prepared for compromise to accommodate the other side’s “core national interest.” For example, China may assist the United States to facilitate its economic recovery by accepting America’s request in economic and financial dimensions. At the same time, the United States may allow the “2+2” talks between two foreign ministers and two defense ministers (currently the U.S. + Japan) to become the “2+2+2” talks (U.S. + Japan+ China). This way, a stable dual leadership structure can be better developed.

This dual leadership structure can also be analyzed from the following two perspectives. One way to examine the issue is that in terms of perceptions, we do see that the gap between the U.S. and China in many dimensions is narrowing, such as in overall GDP, with many projecting that the latter will surpass the former in about 20 years. In sum, as China’s global influence and soft power continues to rise, as well as its overall GDP, the perception could be that China is moving up while the U.S. is moving down. Another angle from which to see the development is that China may become a world superpower in certain dimensions, such as economic, but it is unlikely for China to become a dominant power in other dimensions, such as military and political.

The reason we emphasize the emergence of this new leadership is because it is likely it will last for a rather long period, well into the rest of this century. China’s economic power may continue to grow and U.S. military power may continue to be dominant, therefore one cannot replace the other in certain fields. The two countries and other players have many incentives to expect a complementary relationship between China and the United States. Not only will each play a leading role in a certain field, but the dual-structure leadership may also ensure regional stability and prosperity for the years to come.

[1] Robert Sutter, “Assessing China’s Rise and US Leadership in Asia – Growing Maturity and Balance.” Journal of Contemporary China. April 28, 2010, pp. 39-77.

[2] “Strengthen Ties with China, but Get Tough on Trade,” PEW Research Center for the People and the Press. January 12, 2011. http://pewresearch.org/pubs/1855/china-poll-americans-want-closer-ties-but-tougher-trade-policy.

[3] International Monetary Fund, March 3, 2011. http://www.imf.org/external/np/exr/facts/quotas.htm. Accessed March 21, 2011

[4] Hiro Ito, “U.S. Current Account Debate with Japan then, with China Now.” Prepared for Conference Asian Economic Integration in a Global Context. February 6, 2009. p. 5.

[5] Ronald Tammen, et al., Power Transitions: Strategies for the 21^st Century. New York: Chatham House Publishers, 2000, p. 31.

[6] Christopher Lane, “China’s Challenge to US Hegemony.” Current History. January 2008. p. 16.

[7] Robert Kagan, “The Illusion of Managing China,” The Washington Post. May 15, 2005. http://www.carnegieendowment.org/publications/index.cfm?fa=view&id=16939

[8] Robert J. Art, “The United States and the Rise of China: Implications for the Long Haul.” Political Science Quarterly. 2010.Vol. 125, No. 3. p. 366.

[9] Robert Keohane, International Institutions and State Power. Boulder, CO: Westview Press,1989, pp. 159.

[10] Robert Koehane, After Hegemony: Cooperation and Discord in the World Political Economy. Princeton, NJ: Princeton

University Press, 1984, p. 51.

[11]William C. Olson, Theory and Practice of International Relations, 9^th Edition. Englewood Cliffs, NJ: Prentice-Hall, Inc. 1994, pp. 210-211.

[12] Barry Buzan, “New patterns of Global Security in the twenty-first century.” International Affairs (Royal Institute of International Affairs 1944-) Vol. 67, No. 3 July 1991. pp. 431-451

[13] James Dougherty and Robert Pfaltzgraff, (2007) Contending Theories of International Relations. Addison Wesley Educational

Publishers, Inc. 2007, p. 419.

[14] Edward Wong, “Former Carter adviser calls for a ‘G-2’ between U.S. and China.” The New York Times. January 2, 2009. http://www.nytimes.com/2009/01/12/world/asia/12iht-beijing.3.19283773.html?_r=1

[15] R.A., “China: Second in Line.” The Economist. August 16, 2010. http://www.economist.com/blogs/freeexchange/2010/08/china_0 Accessed February 19, 2011.

[16] Gordon Chang, The Coming Collapse of China. New York: Random House, 2001.

[17] See World Bank data: http://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG

[18] He Liu and Wang Jingzhong, “China Takes Leading Role in Global Recovery: Asia Pacific Business Leaders.” People’s Daily. November 15, 2009. http://english.peopledaily.com.cn/90001/90776/90883/6813259.html

[19] Dick Nanto and Emma Chanlett-Avery, “The Rise of China and its Effects on Taiwan, Japan and South Korea: U.S. Policy Choices,” Congressional Research Service. January 13, 2006. p. 1.

[20] Yuan-kang Wang, “China’s Response to the Unipolar World: The Strategic Logic of Peaceful Development.” Journal of Asian and African Studies. 2010. Vol. 45, No. 554. p. 563

[21] Geoff Dyer, Jamil Anderlini and Henny Sender, “China’s Lending Hits New Heights,” Financial Times. January 17, 2011. http://www.ft.com/cms/s/0/488c60f4-2281-11e0-b6a2-00144feab49a.html#axzz1FUcJlnYW

*note- the actual numbers may be debatable, which was brought to my attention by my colleague at American

University, Deborah Brautigam.

[22] China FTA Network, Ministry of Commerce, PRC.. http://fta.mofcom.gov.cn/english/index.shtml. Accessed March 18, 2011.

[23] Center for Arms Control and Non-Proliferation, May 2010.

[24] Stockholm International Peace Research Institute Yearbook, 2010.

[25] John Pike, “Military: Ulchi Focus Lens.” GlobalSecurity.org. 2000-2011. http://www.globalsecurity.org/military/ops/ulchi-focus-lens.htm. Accessed February 19, 2011

[26] John Pike, “Military: Team Spirit.” GlobalSecurity.org. 2000-2011.. http://www.globalsecurity.org/military/ops/team-spirit.htm. Accessed February 19, 2011

[27] Luis Martinez. “U.S. to Join South Korean Military Exercise off North Korean Coast.” ABCNews.com. June 2, 2010. http://abcnews.go.com/Politics/Media/us-join-south-korea-military-exercise-north-korea/story?id=10807101 Accessed February 19, 2011.

[28] “Pakistan to Conduct “Aman (Peace) 09″, Multinational Maritime Military Exercise.” February 27, 2009. MarineBuzz.com. http://www.marinebuzz.com/2009/02/27/pakistan-to-conduct-aman-peace-09-multinational-maritime-military-exercise/ Accessed March 4, 2011.

[29] “South Korea-US military exercises stoke tensions, ” November 28 2010. BBC News. Accessed February 19, 2011. http://www.bbc.co.uk/news/world-asia-pacific-11855162

[30] Shanghai Cooperation Organization. 2011. http://www.sectsco.org/EN/ Accessed March 18, 2011.

[31] Andrew S. Erickson, “Chinese Defense Expenditures: Implication for Naval Modernization,” China Brief. April 16, 2010. Vol.10, No.8. pp. 11-15.

[32] “GDP Could be 2.5 Times that of the US by 2030.” China Daily. May 3, 2008. http://www.chinadaily.com.cn/china 2008-05/03/content_6657813.htm

[33] “Clinton: Use “Smart Power” in Diplomacy.” CBS News. January 13, 2009. http://www.cbsnews.com/stories/ 2009/01/13/ politics/main4718044.shtml

[34] Stapleton Roy, “Foreign Service Challenge: Dealing with a Rising China,” Annual Adair Lecture on the Foreign Service. September 2010, p. 4. Transcript.

[35] Robert Sutter, “China Reassures Neighbors, Wary of US Intentions.” Comparative Connections. January 2011. p. 1.

[36] For more on the “charm offensive,” see Joshua Kurlantzick, The Charm Offensive: How China’s Soft Power is Transforming the World. Yale University Press, 2007.

[37] Robert Sutter, “Assessing China’s Rise and US Leadership in Asia – Growing Maturity and Balance.” Journal of Contemporary China. April 28, 2010, pp. 39-77.

[38] Quansheng Zhao, “Managed Great Power Relations,” Journal of Strategic Studies. Vol. 30, No. 4-5, August-October 2007, pp. 609-637.

[39]Quansheng Zhao, “Moving toward a Co-management Approach: China’s Policy toward North Korea and Taiwan,” Asian Perspective, vol. 30, no. 1 April 2006, pp. 39-78.

[40] John Mearsheimer, The Tragedy of Great Power Politics. New York: W.W. Norton, 2001, pg. 4, 401.

[41] Patrick deGategno and Damien Tomkins, “U.S.-China Strategic & Economic Dialogue.” Atlantic Council of the United States. August 7, 2009. http://www.acus.org/new_atlanticist/us-china-strategic-economic-dialogue. Accessed March 18, 2011.

[42] Robert J. Art, “The United States and the Rise of China: Implications for the Long Haul.” Political Science Quarterly. 2010.Vol. 125, No. 3 p. 389