A Conference Report

By Amy E. Gadsden

The 21st century has often been touted as the Asian Century, a time when the world's most populous region would set the global pace. Yet there are several conflicts that may seriously impede this lofty vision. And each of these "hot spots" -- the Taiwan Strait, the Korean Peninsula, and the South China Sea -- hold the potential for direct U.S. military engagement. Each of these cases also offers a dangerous combination of unresolved conflicts, intense nationalism, and competing strategic interests. It was with these factors in mind that the Foreign Policy Research Institute convened a high-level conference on May 12, 2000 to assess the nature and status of trouble spots in East Asia and their potential future trajectories.

Conference panelists included Victor Cha, School of Foreign Service, Georgetown University; Felix Chang, Associate Scholar, FPRI; June Teufel Dreyer, a political scientist at the University of Miami and a Senior Fellow at FPRI; Richard D. Fisher, Senior Fellow, Jamestown Foundation; Avery Goldstein, Director of FPRI's Asia Program and a political scientist at the University of Pennsylvania; Roy U.T. Kim, a political scientist at Drexel University; Samuel S. Kim, a senior scholar at the East Asian Institute, Columbia University; Robert S. Ross, a political scientist at Boston College and Research Associate, Fairbanks Center for East Asian Research, Harvard University; Andrew Scobell, Research Professor of Strategic Studies Institute, U.S. Army War College; Harvey Sicherman, President of FPRI; Alfred D. Wilhelm, Jr., Executive Vice President of the Atlantic Council of the United States; and Larry M. Wortzel, Director of Asian Studies, Heritage Foundation. Dov S. Zakheim, former deputy undersecretary of defense and a trustee of FPRI, keynoted the conference.

The possibility of tension escalating over the Taiwan issue was by far the most contested issue at the conference.Speakers painted pictures of the People's Republic of China (PRC) alternatively as a military threat, an unstable political and ineffectual military regime, and a sophisticated practitioner of a "wait and see" policy toward Taiwan. The participants were divided over whether Beijing would become America's great adversary or a healthy competitor, a strategic partner or a strategic opponent. Finally, there was no consensus about what the next moves in the Taiwan Strait might be and how U.S. policy in the region should proceed.

Panelists disagreed over the nature and direction of the military buildup in the People's Republic. The pessimists stressed that the PRC's emphasis on developing and acquiring new technology points to the probability of future aggression. Ominous developments include: the increased number of missiles aimed at Taiwan, the planned acquisition of AEW (Airborne Early Warning) systems to improve air defenses, the acquisition of Sovremenny destroyers (two already purchased from Russia, two more may still be bought) equipped with M-22 missiles, and plans to purchase three retired Russian aircraft carriers to dismantle and study.

Optimists pointed to political rather than to military developments to understand the nature of PRC policies toward Taiwan. They argued that the March election of the Democratic Progressive Party candidate in Taiwan pushed Beijing to keep up the pressure on the Taiwan situation. Beijing fears that anything but aggressive, uncompromising rhetoric might strengthen pro-independence factions on Taiwan. But the rhetoric is no indication of real action. Despite years of military modernization, China is still not able to invade Taiwan (although the PLA is in a position to inflict major damage). Moreover, the issuance of the February White Paper by the PRC and the ensuing bellicose rhetoric on Taiwan may be signs of a weak and divided leadership and lack of consensus about the direction and nature of Taiwan and does not therefore constitute a foundation for a plan of attack.

The question of the PRC's military buildup naturally led to debate over how to equip Taiwan to defend itself. On this issue, the question centered on whether provision of arms to Taiwan unwittingly precipitates an arms race between Taiwan and China that might leave the island even more insecure. Pessimists about the PRC argued for the importance of supplying Taiwan with Aegis destroyers, developing integrated air defense systems, and including Taiwan in any Theater Missile Defense program. Allowing China's warnings about arms sales to dictate American military sales would only encourage Beijing to assert a veto over U.S. policy.

Optimists responded that Taiwan's military capabilities do not warrant providing sophisticated missile defense systems and cautioned that if an arms race were to break out between Taiwan and China, Taiwan would almost certainly lose. They pointed out that the United States has a responsibility to defend Taiwan, but cannot guarantee the island absolute security. Attention should be focused on "hardening" Taiwan's currently vulnerable infrastructure rather than sending sophisticated new equipment the island's own armed forces cannot handle. Taipei must take its own defense more seriously and not expect an American "blank check" on either equipment or commitment.

The verdict on Clinton Administration policy toward China was among the most contentious issues discussed. Has it done more to boost Taiwan's military capacity and political profile than any other recent administration? Those who answered "yes" pointed out that, since 1992, Taiwan has ranked second, third, or fourth for overall arms sales by the United States. They also argued that President Li Teng- hui's visit to the United States in 1995 and the deployment of two U.S. aircraft carriers in 1996 serve as symbols of the Administration's commitment to Taiwan.

In contrast, critics argued that the Administration is in denial about the seriousness of the situation and has contributed to it. Arms sales to Taiwan have remained at high levels in the 1990s primarily because of promises made during the Bush Administration. The deployment of aircraft carriers during the 1996 Taiwan election was an emergency measure the Administration was compelled to take only after ignoring the escalating tensions in the region. In sending the two carriers near the Strait, American credibility became inextricably linked to its willingness to defend Taiwan. This action convinced China that there will be a high price to pay for an aggressive Taiwan policy, but paradoxically it also prompted the Administration to make the "Three-Nos" concession to Beijing in 1998 (no formal independence for Taiwan, no policy of "one China, one Taiwan," and no membership for Taiwan in international groups for which statehood is required).

The panelists agreed that Administration policy toward China has been "jerky" at best with champagne toasts one year and aircraft carrier deployment the next. In addition, the question came up as to what extent American policy makers had a firm understanding of the importance of reunification to Beijing. To a large extent, the Communist regime's legitimacy has become interwoven with this issue. They cannot afford to back down. At the same time, Beijing may be underestimating America's interests in the region and unwavering commitment to a peaceful resolution of the issue. China is offended by recent American statements and policy decisions on Taiwan, such as the Taiwan Security Enhancement Act, and yet, one of the speakers argued, the United States is only responding to China's refusal to renounce the use of force to resolve the issue. Recent statements and military acquisitions reinforce the idea that China is planning to use force to recapture the island. One speaker suggested that if China wants to silence its U.S. critics, Beijing should reconsider its own statements and actions, which up to this point have only lent credibility to "hawks" in U.S.-China relations.

In the immediate future, panelists did not predict any major clashes. Following Chen Shui-bian's inauguration, China is likely to continue a "wait and see" policy, giving Chen approximately half a year to organize his Administration. Beijing will watch anxiously during this period to assess the messages being sent from Taipei. Panelists indicated one might expect a fortuitous encounter in a third country in the next 6-7 months. The sticking point for talks, however, remains Beijing's insistence on Taipei's acceptance of the one-China principle as a precondition for a meeting. One panelist argued that it would be more fruitful to make the one-China principle the first point for discussion of any meeting rather than a precondition.

For exactly half a century, the Korean peninsula has registered at the top of the list of the world's military hot spots. The end of the Cold War and changes in the Democratic People's Republic of Korea (DPRK) regime in the last few years have fundamentally altered the situation on the peninsula. It is not clear, however, whether these changes have made the region a hotter flashpoint or a cooler one.

Today, if measuring by conventional standards, the North Korean threat in aggregate terms is less than it was during the Cold War. Up until the collapse of the Soviet Bloc, the DPRK had a well-trained army, a relatively strong economy, and most importantly the patronage of the Soviet Union and the PRC. Since the end of the Cold War, famine, food shortages, leadership problems and the loss of powerful Communist patrons have reduced the DPRK's conventional invasion capabilities. However, while the conventional threat has diminished, the regime's capacity to disrupt the peninsula in unconventional ways has increased, arguably raising the possibility of a clash in the future.

In the last decade, the threat to the U.S. and South Korea has changed. North Korea has managed to develop a ballistic missile and a nuclear program. Moreover, the regime's role in selling these arms abroad has put it squarely on America's list of states sponsoring terrorist activities.

In the realm of peninsular security, the issues are not as straightforward. While an invasion of South Korea does not seem the immediate threat that it was during the Cold War, the North's proclivity to use isolated acts of belligerence to perpetuate a crisis and push for favorable changes in the status quo is less predictable and therefore profoundly worrisome. The DPRK has turned to coercive bargaining in international relations, agreeing to the requests of the international community only after the powers have agreed to meet the North's excessive and often changing terms.

Changes in the posture of the DPRK regime and the upcoming North-South summit have given many Korea watchers reasons for optimism but panelists warned against being overly confident. Korea is poor, one panelist reminded, but not as poor as we would like to think. Moreover, continued economic setbacks might increase the North's propensity to lash out, not decrease it as many assume. Another panelist reminded listeners that the collapse of the DPRK might not be peaceful and would certainly provoke major humanitarian crises that would have pronounced effects on South Korea and the PRC.

Have there been any real changes as a result of recent efforts to engage the Communist regime? Changes in North Korea have been superficial, not fundamental. Dangerous brinkmanship has been used to extract maximum concessions while making minimal changes at the core. There are hopes but no guarantees that the same "flies" of pluralism and market capitalism that flew into the PRC when Beijing opened to the world will also fly into North Korea. But there are forces in North Korea pushing for change according to one of the panelists. Moreover, the world cannot refuse to engage North Korea indefinitely.

With the prospect of an historic summit on the horizon, panelists also reflected on the prospects for reunification of the two Koreas. Was this desirable, even if possible? Despite the oft-repeated mantra that the major powers involved would oppose reunification of the peninsula based on the argument that preservation of the status quo best serves security interests, the panelists agreed that the United States would support the Republic of Korea if it decided to reunify with the North. But Beijing and Moscow have moved away from pushing Korean reunification, fearing that valuable South Korean investment dollars would be redirected from northeast China and far east Russia to North Korea At the same time, after observing the difficulties and high price of German reunification, the South has become increasingly ambivalent about the idea. Instead, Seoul has started to talk about peace solutions that are not complete mergers -- a one-country, two-systems formula, for example. Commercial engagement has increased, but the emphasis on political reunification has lessened. Unlike the China-Taiwan situation, reunification has slipped from the top of the list of preconditions for negotiation.

All of the panelists raised concern that forces emerging in South Korea may put new pressure on the US-ROK alliance. Rising nationalism will focus on the 38,000 American troops stationed in the country. In the wake of recent parliamentary elections, voters' concerns with environmental and labor issues are compelling politicians to take a closer look at Alliance activities such as land use agreements and live fire exercises. On the whole, South Koreans remain in favor of the alliance, but, as the North Korean threat becomes less clear-cut, other problems will complicate relations between Seoul and Washington.

The panelists agreed that the United States should continueits policy of containment of North Korea, but precisely what kind of containment was not clear. Should it be containment plus isolation, containment plus coercion or containment plus engagement? North Korean diplomats have been very busy in recent months seeking rapprochement with countries in Asia and Europe. But relaxation of ties between North Korea and Italy or the Philippines does not necessarily set a precedent for the United States or Japan. On the surface, the DPRK is becoming a more rational actor in world affairs, but rationality is a relative concept. What appears irrational to outsiders may be quite rational from Pyongyang's perspective; the U.S. and South Korea have been surprised in the past.

In short, recent changes in the situation in the Korean peninsula are no substitute for a strong commitment to the defense of the ROK. Eventually, the true nature of recent developments in the DPRK will become clear. In the meantime, vigilance in the Korean Peninsula, a healthy skepticism about the results of engagement, and a swift response to North Korean brinkmanship are the best ways to manage this longstanding flashpoint.

Clashes in the South China Sea in 1974, 1988 and 1994 confirm that this East Asian region is not just a potential flashpoint, but an actual one. At least six nations (the PRC, the Philippines, Vietnam, Malaysia, Brunei, and Indonesia) have registered their interest in the outcome of the disputed sovereignty claims in the Paracel and Spratly Island chains. In addition to countries that lie around the rim of the area, outside powers (Japan, South Korea, India and the United States) all have an interest in how the situation is resolved. At this time, lack of consensus about how even to begin a discussion of the competing claims suggests that resolution is a long way off.

The Promises of the South China Sea: Energy Resources and Strategic Stronghold The South China Sea offers two significant advantages that make the area a critical region for all of the participants involved. Untapped and potentially significant energy resources (both natural gas and oil) make the area a "must-have" for many of the developing economies of Asia. Within the energy community, however, there is debate over the real value of the resources underneath the South China Sea's rocky outcroppings. The promise of enormous oil finds that circulated in the 1970s has not yet materialized while natural gas resources remain to be explored. Without a clear sense of the potential, countries will continue to push their claims to ensure that they have a right to any valuable finds.

Competition for energy resources alone does not drive the tensions in this region. Lying in the heart of Southeast Asia and serving as the major sea-lane for ships moving between the Middle East and Asia, the South China Sea also occupies a major strategic and security position. While mostly uninhabitable, the islands can serve as key military launching and refueling points. Each of the claimant countries has a stake in both the energy resources and the security advantages promised by the islands.

As the largest power in Asia, China functions like an 800-pound gorilla in the region. Any action taken in the region is scrutinized and reacted to quickly and strongly. In 1994, the PRC met with considerable criticism from the Association of Southeast Asian Nations (ASEAN) when it constructed permanent structures on the aptly named Mischief Reef. More recently, the conversion of additional small buildings into concrete facilities has raised the ire of some claimants, most notably the Philippines, who sanctioned an attack on Chinese fishing boats the following year. One panelist characterized PRC behavior in the region as a "talk and grab" strategy, defined by a preference to avoid pitched battles, choosing instead to pursue a "creeping invasion" that allows it to move quickly when opportunities to seize additional rock outcroppings present themselves. The Philippines, Malaysia and Vietnam, the other principal claimants to the islands, have voiced their dissatisfaction with Chinese actions, but lack the military muscle to back up their displeasure. The Philippines and Malaysia have responded by quietly strengthening their military relationships with the United States, while Vietnam has started defense dialogues with India and Japan in an effort to bolster its position in the region.

As mentioned earlier, resolution of the South China Sea claims does not appear on the near horizon. Beijing refuses to participate in a multilateral negotiation of the claims, recognizing that its negotiating position is significantly strengthened in a bilateral discussion with any of the claimant nations. Moreover, the historical basis of each nation's claim is less than a decisive determinant. Beijing has put forward a laundry list of archaeological claims that show China's historical ties to the region dating back to early antiquity. Malaysia, Brunei and Vietnam link their claims to claims made by Britain and France during the height of their imperial presence in Asia. It should be noted that China made repeated claims to the South China Sea islands throughout the 1950s, which were for the most part unchallenged. Only renewed interest in the area on the part of the Southeast Asian nations in the 1970s and 1980s focused attention on the islands and ratcheted up the debate over ownership.

Despite the conflicting claims, panelists agreed that the South China Sea is not as "hot" a flashpoint as the Taiwan Strait or the Korean Peninsula. Nevertheless, the fact that there is no bilateral or multilateral framework in place to resolve the claims means that there is potential for increasing trouble. Without a resolution framework, panelists speculated that clashes in the area would continue along the same lines as present. One panelist coined the term "slow intensity conflict" to describe what he thought might happen in the absence of negotiation. Conventional, small-scale clashes between competing countries will continue, he explained, but the overall level of violence would remain low. The only option for U.S. policy on the issue is official neutrality on the issue of ownership, backed up by firm rebuke of any country that attempts to disturb the situation.

As we move into the 21st century, the shifting dynamics in the region and especially the troubling flashpoints that threaten the peace demand attention. In the Taiwan Strait, open communication and understanding the stakes of all involved will remain the keys to increasing the chances for a peaceful solution to the problem. All sides will have to compromise. A recent rumor that Taiwan and the PRC have asked the United States to help with contacts is a sign that both the mainland and the island want to reduce tensions. In Korea, the international community welcomes changes in the DPRK, but must remain firm in the face of demands or outbursts made by the rogue state. In the South China Sea, a recent calm should not be mistaken for resolution of the problems. Tensions in that region run as deep as the proverbial still waters and just as in 1988 and 1994, it may only take one quick move for this flashpoint to resume its place near the top of the list of Asian trouble spots.

Finally, a word must be added about the PRC, which was the focus directly or indirectly of much of the discussion during the one-day conference. All agreed that China's recent unprecedented economic growth and contributions to regional developments are welcome events. In their assessment of China's potential direction, however, panelists reflected the divided opinions of the larger policy community, with some painting China as the future enemy, while others downplayed the military threat and stressed the importance of working together. There is a schizophrenic quality to the debate. As we look to the future, our first task is to find a way to talk about China policy that eschews the extremes of both "strategic partner" and "strategic adversary." Growing military power, a regime in transition, and a strong economy -- China is all of these things. A sound policy should not paint one of these issues more brightly than the others, but must deal with them equally, consistently, and realistically.

Amy Gadsden, a Research Fellow at FPRI, is completing her doctorate in Chinese history and international relations at the University of Pennsylvania.