U.S.-China 2020: A Year of Living Dangerously

well good morning everybody thank you forget thank you for getting out of bed the I'm always impressed serious Protestant work ethic down here in Washington the Calvinist Confucian whatever wherever else you want to describe work ethic but it's be good good to be among you and Thank You Wendy for the introduction and and John Negroponte who is co-chair of the Asia Society Policy Institute Advisory Council I was speaking with John this morning just before I came down here and you are privileged to have with you a man who represents extraordinary historical continuity and John reminded me that his worst first visit to China was in 1972 with Henry Kissinger and he had one throwaway line which was you know Joe and my work wasn't a bad guy wish I could say that I never met Joe and I but John know it's really valuable to have you with us because one thing those of us who have long been fascinated with the Middle Kingdom value is a level of continuing historical knowledge so we thank you for your service and public office here in the United States but also your knowledge which for us is important I also noticed that Wendy acknowledged young China watches how many of you are young China watches okay good on you this is an arduous path that you have chosen and guess what when you were our age you will look back and said what you look back and say what on earth was I thinking because China will never get out of your veins and nor should it it's both the the antiquity and continuity of the civilization the complexity the modern Chinese nation-state its rise and all of that which commands serious and focused intellectual attention and so for those of you who have embarked upon this path I would say the first principle is um we're gong and we his language comes first and the second is understanding history understanding historical context I addressed a group of young China watches a couple of months ago in London and mmm it was a packed room a hundred young China watchers in London and so I thought this is for me gives me encouragement for the future so well done those of you who have engaged afield it's difficult to begin talking about either China of the us-china relationship today of all days when we see this unfolding tragedy a human tragedy in China itself the coronavirus and so whatever else is going on in Chinese politics our perceptions of it us-china relations our perceptions of it let's just reflect for a moment with some genuine humans solidarity on what is an unfolding human tragedy in China itself not just for the good people of walk on a city where I've spent a lot of time over the years it's a great Chinese city in history and a vibrant city in the modern Chinese economy a vast city but also the fear and anxiety right across China itself in so many centers a death toll of a hundred plus two or 3,000 people known to be infected and many thousands more suspected to be infected and the genuine anxiety about the future and so for all of us whatever our views I think this is an important time to reflect our solidarity with the good people of China as they deal with this deep human anxiety and we wish Godspeed to those working on the corona virus vaccine and their important work being undertaken in laboratories across China and across the world as we speak we're here today to launch the thoughts of Kevin this thing here it's not as intellectual as other thoughts that have been published the avoidable war the subtitle the case for managed strategic competition many people have asked me why do you use the term Kirby me and John John the avoidable war well we're fairly direct people in Australia would rather you avoided war but it's also a partial response to the book produced by my friend and colleague from the Belfer Center at Harvard Graham Allison whose book destined for war was published only two or three years ago and the publishers of Graham's book wanting to sell a book gave it that title if you actually read the book it's more complex case than that it examines 16 historical case studies of great powers existing and rising in the last 500 years of history and points to certain probabilities not inevitabilities probabilities so the poetic license taken in a title destined for war over States Graham's proposition considerably but it's a proposition which has gained in my view some currency here in Washington and a lot of currency in Beijing and therefore it warrants in my view a considered sets of analytical and shall I say policy responses to that proposition of inevitability and hence my argument about avoid ability and I mean avoid ability in terms of Cold War's warm Wars and hot Wars and so that in part is why we have begun this series not each of the essays contained within it deals with the absolute machinery of the relationship it deals with other aspects of Chinese domestic politics China's economics as well as the physicality of the us-china relationship but the overall proposition both in the volume we released 12 months ago and in this volume and a book I'm working on at the moment by the same title is at these two great countries and civilizations put their minds to it through the ancient craft of diplomacy and then there's a way through this but it takes serious intellectual effort and serious conceptual frameworks agreed to on both parts when we look at the concept of what is driving the thesis that these two countries are inevitably destined for one form of conflict or another of course and those supporting the arguments say this is structurally inevitable the United States the established great power the established superpower uncontested since the collapse of the Soviet Union in 1991 as now for the first time challenged by a country of comparable critical mass in terms of its sheer economic heft and weight as well as the dimensions of its unfolding global and regional in particular military capabilities both conventional and nuclear and that is the logic that as China's critical mass in both those articulations of national power becomes greater relative to the United States then it create creates the circumstances described in a historical case studies which Graham Allison alludes to in his book that's the structural factor at work writ large or rich writ small I however come from a different school of international relations theory and practice which is one which believes in agency and that is the agency of diplomacy and that actually believes that decisions by women and men in leadership around the world actually matters and changes the course of history and can change it in either post profoundly positive or profoundly negative directions and therefore our responsibility for those who are diplomatic actors today is to argue conceptual frameworks which recognize the unfolding strategic reality which understand the dynamics of the balance of power which don't create what I describe as castles in the air' of a utopian universe dreamt of by Immanuel Kant a couple of hundred years ago and articulated through the fourteen points of President Wilson's charter for the League of Nations No anchored deeply in the balance of power and those realities but more reflective of the strategic realism which characterized the then us Soviet relationship apply some of the principles of the period of day taunt in that relationship to our current strategic realities and that is very much the set of arguments unpacked in this particular set of essays and for those of you who are interested in digging down as to what I actually mean by that I draw your attention in particular to the record of the dialogue between myself and Graham Allison at the Harvard Kennedy Forum in December last year in Cambridge which is Graham and I politely friendly but in a firm way exchanging ideas on what might constitute an effective intellectual and policy framework for diplomatic actors seeking to manage the long-term stability of the us-china relationship without simply conceding to the structural determinism that because of the competing sizes of these two giant elephants in the global living room that we're therefore somehow destined to the inevitability of human conflict let me just speak for a bit on the organizing principles of what I described as managed strategic competition and again I draw your attention to Chapter seven of this seven part small volume five years ago at Harvard when I was first invited there by Graham as a political exile from Australian politics and seeking sanctuary and protection from the Australian authorities who are in search of me having fled high office I worked here for one year on a piece of analysis entitled constructive realism an intellectual framework for us-china relations under Xi Jinping then the assumptions were we were dealing with a continuing Xi Jinping Obama and likely to be Xi Jinping and Hillary Clinton set of analytical assumptions of course things have changed there's now someone else in Pennsylvania Avenue I'm reliably advised he maintains a quiet and low profile and and occasionally chooses to communicate with the outside world using some of the devices of social media I'm reliably informed but the organizational framework contained in the original piece of research which you can see also online from the Asian Society it's pretty simple constructive realism what's by realism and I'm drawing on a body of analytical work going back to Vaughn class of 'its and the modern pioneers of realist thinking in this country Morgenthau as well as Walt's and others but the practitioners for whom the organizing principle is the balance of power is you can't wish that away when China looks at strategic reality its strategic reality is to deploy the old Soviet term what is the current correlation of forces between China in the United States measured against all the indices of power what is China's aggregate economic power what are the sub drivers of that in terms the availability of human capital physical population energy resources as well as technology in the other drivers of economic size capability and sophistication China analyzes all these things and therefore when you look at the military equivalent of that which is conventional capabilities nuclear capabilities those within theater those beyond theater those applied to Taiwan those not applied to Taiwan this is all part of a wider calculus and I'm here to say to you is this is not just a preoccupation that PLA it's also the preoccupation the Pentagon and what is now called Indo Pacific Command in Hawaii so for those of us who who want to as a work preserve the strategic piece this cannot be divorced that idea and ambition cannot be divorced from that underlying strategic reality the balance of power it's there and there's a rolling calculus of what it is both in the economic and security domains and of course these are then given further articulation in the realm of let's call it political and foreign policy influence as third parties third countries begin to look at the change in the calculus of the balance of power on the region then third parties according to the international relations theorists and I think there's a lot of empirical evidence to back this up either balance that is join with one side and balancing against the other they bandwagon that is once they conclude that the game might be over they bandwagon with the likely winner or they hedge that is we're not quite sure who's going to win and if we were actually to look at the strategic and foreign policy behaviors of many regional states at the moment they tend to follow one or other of those categorizations but that is let's call it the realist dimension of what I described before is constructive realism what's the constructive side well I go back to by dichotomy before that I articulated before between structure and agency if realism and the balance of power is a structure underpinning structure of the realities we see unfolding in the dynamics of the us-china relationship and how third countries perceive it the agency the constructive agency lies in the diplomacy of leaders and therefore what diplomatic actors seek to do managing and guiding and shaping that underlying strategic competition defined through the concepts the balance of power and these diplomatic actors these constructive diplomatic eight actors are not simply passive observers waving their hands haplessly and helplessly on the side saying goodbye to peace welcome crisis conflict and war no they're not and the diplomat history of diplomacy in diplomatic histories of this relationship will indicate on multiple occasions including when John Negroponte has been in office in one capacity or another when active diplomacy intervene not just to defuse a particular crisis but to articulate a framework within which crises could be managed longer-term we don't have time this morning to go into the sub detail of all of the above but my overall point is that diplomacy matters diplomatic actors matter but they doubly matter when they are operating within a wider framework my second point to this morning is what is the wider framework the wider framework I'd point to is America's deep learnings from the crisis in us-soviet relations the 1960s those are a few who are old enough to remember the Cuban Missile Crisis in 1963 we'll understand that things got very close without rehearsing the history of the crisis and the great historian of the crisis by the way is Graham Allison and his seminal text essence of decision on the decision-making processes on both sides as it related to the Cuban Missile Crisis the long institutional learning by the United States and the Soviets during the 1960's and certainly following the removal of Khrushchev was to auguring a period of date to welcome in owe period of date aunt and when we look back at what date aunt was it looks far simpler in the retrospective than it was in the active articulation of it at the time when people were legitimately pushing into the dark but its organizing principle was these two highly competitive great powers the Soviet Union United States could at the highest levels of political leadership agree on a framework which was not going to push the relationship and the world across a brink that was its organizing principle and within it at the highest levels of political exchange between Brezhnev and a series of American political leaders from that time on was that there were certain red lines not to be crossed that's my second point my third and I conclude with this is therefore what are the organizing principles of what I called managed strategic competition today I would simply argue the following this administration the Trump administration in the national security strategy released at the end of 2017 formally repudiated the age of strategic engagement between the United States and China as a thing of the past and as a framework for analysis which did not achieve its desired results I'll leave that debate for another day as to whether it did or whether it didn't or whether it partly achieved its objectives or not but it said we have now entered into a new period of strategic competition it leaves undefined what actually that means it leaves undefined what the precise articulation of that concept means in the operational strategy the United States across all agencies state the Pentagon the military the economy but we see some of the resonances of it through the execution of the trade war we see some of the resonances of it through shall we say changing American postures on the Taiwan question we see other resonances of it as well interestingly China itself at the highest levels of national strategy have not declared in parallel terms that we are therefore in a period of strategic petitioner in the United States that has been left to one side as the Chinese internal processes are now underway to formally review their own global strategic settings most particularly in relation to this relationship but if you accept the proposition at least from the American side and de facto perhaps from the Chinese side that this is now a demonstrably and self-defined competitive strategic relationship I conclude by saying this what are his organizing principles you can either just sail into the sunset and say well we're now competitors this could end very badly or it could be okay it could be peaceful competition it could be difficult competition it could be in your face competition it could be adversarial competition it could be military confrontation competition containment crisis and conflict and we all know from diplomatic history how easy these things are to see escalate so my argument about the five principles for managed strategic competition as opposed to unmanaged a strategic competition is as follows one it must be anchored in the reality of the balance of power and therefore if you simply try to create an idealist diplomatic castle in the air detached from the underpinnings of the balance of power both objectively and is perceived in both capitals it won't work China respects power I'm a student of China I have been since the last days of the Cultural Revolution China when it sees other countries it is deeply respectful of national power it's not that it's not respectful of other factors as well but it's deeply respective and fundamentally respective of power it's also our product of China's own communist tradition you look at the history of the Chinese Communist Party the fact that fought a civil war between 1921 as well really 1927 through until 49 in two large stretches with the war against Japan in the middle the bottom line is our Chinese friends when they look at this relationship do see it through the lens of power so this must be principle number one but principle number two is drawing on the traditions they taunt the two leaders of the two countries must similarly agree on their own internal red lines for managing the relationship lines which cannot be crossed three red lines having been clearly communicated privately but not publicly in my view then the next step in this five-part set of concepts is to define those areas in the relationship the strategic relationship which are difficult but doable the usual example I give presentations like this is the question of Korean denuclearization important for both sides in different ways but if it was to be achieved an enormous addition to let's call it the bilateral political and diplomatic capital between Washington and Beijing for those parts the relationship which should be normal as far as continuing global engagement cooperation and producing global public goods obviously depending on your political point of view in this country I would argue however that must have as front and center climate change collaboration button given the remarks I've already just made on the question of global pandemics now this also is a demonstrable global public good where the two countries the two administrations must as a matter of natural expression of their own national interests construct effective global agreements which benefit not just themselves but the rest of the human family as well principle number four and principle number five is if there is an ideational debate between the two countries not as sharp as the Cold War between Soviet Communism and Western capitalism but if there is one which is about China's understanding of what constitutes the China model the China development model or what we in the West would describe as its own form of authoritarian capitalism or state capitalism and if Xi Jinping and others believe this is now a credible alternative development model for the rest of the world and the United States and others actually have a different view liberal democracy and the book capitalism remained valid concepts then let a hundred flowers bloom and a hundred schools of thought contend and classical Chinese expression which is let us see which of these two sides prevails around the world and if we have confidence in our body of ideas those of us who come from the Western tradition the liberal democracy and liberal capitalism with rolling refinements over time particularly given the challenges of global development where many of the models have been less successful if we have confidence that's going to can succeed than a will if our Chinese friends have confidence that their alternative models succeed then it will or it will be a messy combination of the above so my argument to conclude is this looking at those five principles balance of power difficult and dangerous areas where the two countries should identify red lines difficult and dangerous areas however where they can collaborate and cooperate obvious areas for engagement in cooperation plus may the best man or woman win in the global battle for ideas these I believe are the organizing principles for managed strategic competition and it's around that concept that this set of essays is launched today thank you for your attention well thanks Kevin and now I have the pleasure of introducing ambassador John Negroponte as Kevin mentioned in his remarks diplomacy matters and I can't think of a more effective and a more distinguished diplomat than John Negroponte II he's had a very long and distinguished career serving as ambassadors to a number of countries including Mexico the Philippines Honduras the United Nations in Iraq he has worked on the National Security Council was the first director of the National Intelligence and was deputy secretary of State he now serves as vice chairman of McLarty associates he is an Asia Society trustee and the co-chair of the Asia Society Policy Institute Advisory Council and just an incredibly close friend and strong supporter of the work that we do here in ass be both in New York and Washington so without further ado let me introduce John to the stage he will lead a moderated discussion with Kevin Rudd and then we'll be opening it up to questions so use the time to think about some of the questions you might want to ask this distinguished group of people thank you very much [Applause] Thank You Wendy and thank you for the tremendous work that you do on behalf of ass be down here in Washington I think I've been a trustee of the edge of society since the inception of Ashby and I I really think it was an inspired decision on their part we're so fortunate to have been able to recruit kevin rudd to lead that effort and I think you've really made a tremendous mark on the think tank world here in the United States among the many other things that you are engaged in Kevin mentioned the fact that I had first went to China in 1972 with Henry Kissinger actually I was a vice consul in Hong Kong which we didn't call China then it was a British Crown Colony but I was a vice consul in Hong Kong back in 1961 so I had a bit of a window on China to the extent that you could see through the border at that time what was the Ching dynasty like we either we therefore the Ching dynasty this sorry disrespect ministry I never thought when I started my career in Hong Kong that that that experience too would be relevant looking back on yeah on it's not the events that have occurred since that time but I'd say since in those almost 5060 years that have ensued ever since 1972 I think up until about a decade ago Americans thought of the us-china relationship as a positive sum game a win-win as the Chinese hmm like to call and you always when you have a dialogue with the Chinese are always saying well let's make this a win-win situation but then the question is how do you do that and is it really and are there some areas where at the moment we're not exactly in a win-win posture and if so what are we going to do about it I was thinking of your five categories there Kevin about how our approach what our approach to China must be anchored in and of course buried in there somewhere is what about the really intractable problems and how do we how do we manage those the South China Sea some of the difficult economic issues that we confront and which are going to no doubt come up in the face to economic negotiations in which we're not really dealt with in the first round intellectual property cybersecurity and so forth so we've got tremendous challenges but what I would like to ask Kevin in the first instance is to maybe talk if you could talk to us a little bit more about China's world view I remember attending a CSIS meeting at which the foreign minister of China outlined five principles of Chinese foreign policy and the fifth one somewhat to my surprise was to uphold the global order that was established after World War two and so how could you interpret that point for me and I mean do they still make that argument is that they do accept I would say just one word in Chinese Yaser dog orgy doodle which is a world order with Chinese characteristics and and there is an emerging literature on this I think the key text for us to look at here John and China is a country of texts is the central party work conference on Foreign Affairs in November of 2014 which has never been Xi Jinping's address - it has never been released in full but there you see a really interesting phrase which in my judgment had been used for the first time in the modern period that is the post 78 period and that is we in China are now engaged in a struggle for the future of the global order bill Jung and I remember reading this at the time the People's Daily and said whoa struggles back those of us who read the history of the Cultural Revolution understand the centrality the concept of struggle if you've read your your your Marxist text you understand the centrality of struggle as a as a core concept of that ideational worldview so I then began looking at what I actually mean by this so my best articulation of its along these lines John and practical diplomatic terms the existing institutions of global governance the other nations the Bretton Woods institutions and the rest China's posture since 2014 pushing Dunn's axiom of hide and Bide to one side has been - through financial investment the deployment of personnel and changing the culture of these pre-existing institutions of global governance all in a direction more a comedy of Chinese national interests and values and you see this across the UN institutions there are I think five UN related institutions now which are headed by PRC Chinese for since the purge of the head of the Interpol who was convicted for corruption just the other day in China but prior to that conviction there were five that's unprecedented and so you see this also emerging in China's funding for bigger global institutions for example Wendy will soon convene here a meeting on the future WTO I was speaking to WTO officials not long ago about now the fact that their overwhelming funding source for the research activities the WTO Secretariat and Geneva comes from China and as you go across the UN agencies and the Bretton Woods institutions you see previous Chinese as it were passive engagement with those institutions rolling with the consensus whatever the consensus happen to be except when Taiwan questions came to the fore to now an unprecedented Chinese a activism across these institutions and for the first time in recent diplomatic history Chinese multilateral initiatives whether it's on Afghanistan or other questions that form central parts of the global political agenda that's part a of what I see as being the struggle for the global order Part B is China in parallel to that creating a new set of institutions beyond the UN Bretton Woods institutions of the 4445 settlement whether that's the belton Road initiative which now has 70 plus participating states depending on your definition whether it's obviously the classical debate around the Asian infrastructure investment bank the BRICS Bank or others or the parallel foreign policy and security institutions whether it's the ongoing evolution of the Shanghai Cooperation Organization SCO seeker the that's called the Eurasian security organization plus China's own plus one Arrangements around the world sixteen plus one and Eastern Europe now seventeen plus one with the Greeks as the M plus one the Latin American arrangements now where you have C Lac plus China now meeting separately so what you see is the emergence of a parallel set of institution so what's the final Chinese roadmap not sure but what I know about our Chinese friends is they're proceeding on both fronts simultaneously not ultimately see what shakes down mm-hmm so the Chinese what it this does also raise the question about whether at certain points in the recent past if we had had a little bit more inclusive attitude towards China hmm but some of these initiatives that you described may not have taken place I'm thinking for example of the capital expansion of the IMF for greater greater opportunities for China to participate in those very existing institutions that they say they want and and that order that they wanted to defend and I think we've tended to be quite protective of our relatively exclusive role in these answers you where we've we've we've been literally the predominant influence and the subtext in Beijing is not just protective but racist okay no no I'm I'm just yeah reflecting an uncomfortable reality that this was a personally for 45 settlement by a bunch of white guys look at the San Francisco conference look at Bretton Woods and they say well now there's a whole new world which is 50 nation-states that's become out of 93 we Chinese have some status with the rest of let's call it the non-white old colonial world I don't say that to defend Chinese position but to describe it and when you get beyond polite diplomatic parlance they say yeah we just cents or a whole lot of doors shutting right but my my my point would also be that we have protected the status quo for such a long time that I think some of these developments that you described became inevitable look at the debate and it's a very logical one but it doesn't mean it's going to change about the composition of the permanent membership of the Security Council of the United Nations everybody absolutely agrees that the the reality of today is not the reality of 70 years ago and yet it's proven impossible to figure out a way how to reform the Security Council of the United Nations and countries that ought to have maybe a more prominent place in that institution don't and the existing members of the Security Council just sort of protect the status quo so I mean you you do have that debate but this also goes to the issue of China's global aspirations I mean they it's frequently China's attitude is frequently described as wanting to push us out of Asia so to speak or certainly out of the East Asia Pacific region they don't I don't think they appreciate the ascendant position we've had in in that part of the world and very often in the dialogue that we have with our Chinese counterparts it's it manifests itself in terms of well you know what are these alliances that you have that were created so long ago ie Japan and Korea really you know we need some kind of a new order in the East Asia Pacific region I think the South China Sea is a manifestation of that but my question and I think I can understand roughly China's aspirations in the East Asia Pacific region I think they're going to meet with our resistance and they're probably not going to be able to significantly alter our position but what is what are their pretensions beyond the asia-pacific region do they have do they aspire to be a global a global geopolitical power notwithstanding their protestations to the contrary or do they still protest to the contrary I think the honest answers to that is while that's not a phrase that China uses to self described mm-hmm when the proposition is put by others around the world China doesn't necessarily protest mm-hmm in the way perhaps it once would of would have I should say to back up briefly on your I think correct analysis about East Asia I think that's true China's actually made no bones about this has been quite plain they see the alliance structure at the United States in East Asia as quote a cold war mechanism they think they should stop clear part of Chinese declaratory policy they don't you know be around the bush with all of that and you might say well why or what's driving China on this I think its own sense of as it were integrity of its nation-state given the proximity of US surveillance flights etc to the Chinese coast secondly particular military contingencies around Taiwan which therefore mean that you need to push from a Chinese perspective the Americans back to the second island chain in order to create the political and military circumstances or the military and political circumstances to regain Taiwan and then drawing on more ancient precedence from Ming and Qing times a view that East Asia forms part of the wider cynic world that is China will sigh no world or China's natural area of info whether it's John Fairbanks and notion of system of tributary states or wider concepts when you roll in for example the inner North Asian neighbors and China's organizing principle and all of that has been one of its own internal security given that in Chinese history multiple occassions externals invaded the country successfully and actually then took control of the country anyway that's China's primary preoccupation as you know on the taiwan question from their perspective this work is ongoing and is not complete therefore the level of geopolitical and geostrategic attention to the world beyond East Asia is much less the caveat is what in this town is now called the Indo Pacific where China through a combination of the land-based Silk Road initiative but the maritime Silk Road is now unfolding a new set of relationships which have not just an economic component but increasingly a security component as well if you look at port developments whether it's in Cambodia whether it's in Myanmar where it's in Bangladesh whether it's industry Lanka whether it's in Pakistan or whether it's the new Chinese naval and military base in Djibouti okay except for the Djibouti one the other ones are arguably in their near abroad wouldn't you say I mean it well I don't know if you could argue that Pakistan is an ear abroad and guide all that sri lanka is the near abroad or for that matter that even bangladesh is necessarily alright the near abroad and as you know bangladesh doesn't fall within the strategic remit of East Asia even in Chinese classical historiography so that's actually a new terrain and we you know how these things are in Chinese rationalizations justified well we're there because we're protecting sea lines of communication all of our energy comes out of the Gulf is not a little bit but a large slice of it rely upon Uncle Sam to defend our slocks we can't therefore we got to do it ourselves then there's piracy and therefore this requires a more advanced Chinese naval presence and if you look at the numbers on a on a continuing basis they're about four or five units that is ships of the PLA Navy plan on continuing active deployment I think that's called at the Indian Ocean this is something of a shift big ship flows of a decade ago does it equal however US naval resources anchored in Bahrain know before you roll in Pacific Command so I think that deserves its consideration in terms of a future geopolitical role and the the wider thing I would just add to this part of the conversation is we need to look carefully at what China is now contemplating in its widest in its general strategic relationship with the Russian Federation long debate in its own right but let's ask ourselves this question why on earth is the People's Liberation Navy plan conducting naval exercises with the risky's in the Mediterranean the Baltic now these don't happen often what's all that about so I've often said to PLA leaders in Beijing what the hell are you guys doing I mean I understand I mean the the normalization of Russia China relations a whole history of 400 years I understand what you're doing in East Asia with our Russian friends but in the Atlantic and so why is it therefore that the most recent NATO communique for the first time names China is both a challenge and an opportunity now I extend to be corrected on this but in previous NATO communicators I have not seen China named as being a relevant factor to the North Atlantic Treaty area this is new so I think there's an incomplete answer to your question but there's an Indian Ocean bit there's a Gulf bit on energy security there's a Russia bit and and finally there's a cyber bit and space bit which as you know transcends meet geographical spheres of influence and interest because it becomes global but meanwhile would it not be safe to say that their predominant strategic priority is in their own neighborhood yeah which is why in answer to your question I said here's their set of rationales for East Asia which remains dominant yeah it's at least three quarters of the game and three quarters of these strategic energies of the country that's an interesting don't forget Bri don't forget the Indian Ocean don't forget the Gulf and whatever is unfolding with the Russians and what's happening in cyber in space create new more global realities but it's at best one quarter of the game and interestingly some of these developments in recent times the more concerned that the rest of the region becomes because of their behavior and the more concern we might become the greater expressions of support we make to countries like Japan on the one hand and the Alliance's I'd say gotten stronger in the last several years and even tie in the case of Taiwan I think we've done a number of things to bolster our relationship with that countries it's kind of interesting it is an action and a reaction involved in that situation I just take you before we open it up to questions two one economic question we've gotten through phase one of the economic negotiations and where we don't know when phase two will start perhaps it'll be after the next elections I don't know what will happen between now and November but what do you visualize in that and and I'm have in mind particularly some of these intractable issues that were somewhat finessed in in the first round but where do you see the economic relationship heading and and I guess related to that isn't this a critical element in introducing a little bit of stability into the relationship if you've got some of these other we have some of these other concerns strategically politically or otherwise if we can get the economic relationship on some kind of normalized footing it would seem to me that that would be an extremely important accomplishment I think the best way to look at the phase one deal is to see it as a ceasefire but it's team Jack but I wouldn't go beyond that to be quite honest and it's a ceasefire within a narrow in within one part of the wider economic relationship phase two in the trade bit has yet to be done and the core unresolved business of phase two is the future of Chinese state subsidy for Chinese firms operating in the global market and I don't believe that that is has any probability of achieving agreement because you go to the absolute core of the Chinese state model the core of the Chinese state capitalist models obviously can describe it before I therefore see if I could be blunt about it not based on information but just purely on analysis I don't think it's in either sides interest political interest to see if the phase to deal conclude and or fail this side of a presidential election in this country so we're going to have a very protracted set of negotiations I think possibly about negotiations about the parameters of phase two so but what is that bias that buys us a ceasefire in the trade war and I'm always of a view that ceasefires are better than no cease fires just an old-fashioned view but I'm a basically a peace guy at heart I prefer not people not shooting but that's just you know maybe it's just an Australian view of the world but it's also bad for the global economy as you know from your own deep experience job but so therefore what do I see as that this ceasefire stabilizes financial markets this year it materiality of the actual phase one deal I'm not sure will alter the intrinsic dynamics of the us-china trade the huge open question is given the magnitude of the proposed of purchasing orders by China of United States goods to the tune of 200 billion additional dollars worth of of Chinese imports from this country over two years my god you talk about the 13th five-year plan the Americans have now devised you know the 14th it's purely that I mean it's a state determined purchasing policy something which Stalin would have dreamt of and never been able to execute now how you're going to implement that I've got no idea because you only get big numbers by doing massive long-term deals on LNG well goodbye dear Australian allies gone because so that's our principal export of the Chinese these days huge deals in agriculture in areas like beef and wheat well goodbye Australia again because we become the sacrificial offering up the middle of this economic relationship but we've given you exile Kevin thank you yeah I was thinking of my my country my personal circumcised deliverability and do ability at the actual purchase which would give most Chinese corporations food for thought so one thing is ceasefire yes 12 months don't expect a Phase two deal this side of a presidential election it's my core analysis I think for respective political interests on both sides neither with what we'd would wish to either concede or concede defeat this side of us presidential election and the Chinese want to see who wins the presidential election before they see how serious then administration is on the prosecution of what is left to do but finally on the rest of the economic relationship the technology decoupling continues to unwind the intensity of the Huawei 5g debate in Europe is huge Boris Johnson apparently is due to make a decision today or in days already did what is it okay okay we'll let a lead to it Sonia's epistemological debate about what the core part is then it sounds like a great British fudge to me but but but not that I've ever accused the British of fudging before but the German debate is fascinating the Chinese have said if you don't if you rule out why way then the German car industry will suffer in terms of its markets in China so the so the technology decoupling on that I think is the is the it's simply the appetizer what becomes a wider binary technological debate between the two countries for which I think the next piece of meat on the table could well be semiconductors and then the wider remit of let's call it artificial intelligence so we may have a temporary ceasefire on trade where it goes to in terms the other categories of economic engagement or decoupling between the two countries there's a much more complex question what I see however on the technology drivers is the binary is becoming sharper not narrower and isn't that another area where diplomatic effort that could well be concentrated if we wanted to think about in what's the long-term impact of the eventual decoupling of our two economies I'm not gonna I'm not saying it's gonna happen across the board but if it happens in the technological area it could lead to decoupling in other ways and then I guess that comes down to your judgment as to well how bad would it be for both the global economy and for our own respective economies if there was this decoupling be several percentage points off global growth perhaps to say the least and and therefore this calculus needs to be carefully contemplated both in Beijing in Washington against the other calculus which has already clearly underway in both capitals about what a decoupled technological world would mean for them nationally against what they've separately concluded is he who takes the commanding heights on artificial intelligence for the 21st century is he who wins the 21st century in other words a binary national debate about that against what you and I know to be the awesome phenomenal economic impact of this wrenching of the deep wrenching of the two economies apart so what do you do about it through the agency of the plena see I'm just a simple Australian guy looking at this stuff and so but being an active little think-tank we've been thinking about this because that's what think tanks do we think and and and then we tank knows the big if you think too much we should do a Groucho Marx routine as well but when I look at the iai world as its unfolding and the high-tech world is unfolding i think through this we've focused hugely on what happens in information technology world telecommunications world and prospectively the AI world but what about biomedical research we're actually the potential beneficiaries the human families of both countries what about the ability to use Chinese big data in the rapid testing of cancer treatment drugs which can be thrown onto the American and global markets much more much earlier much more effectively wrapped more rapidly than current testing timelines now I actually thank you cancer treatment drugs I mean as a case study and we are chairing an engagement between msk in New York sloan-kettering and Chinese counterparts most recently held in Guangzhou on what we can do and already you see through emerging protocols between the two sides and drugs already gone to market in the United States one of which I can recall which have been exclusively tested in China and done in a narrow period of time because of the size of Chinese data human data availability in less than a year what would take this country normally 7 years so therefore you have a very human story about the benefit of deep collaboration I'm not blind to all the other difficulties which exist in terms of Chinese biomedical research and the other protocol issues which arise in terms of data privacy data availability as well as let's call it broader questions of medical ethics I'm aware of all that but you ask what can be creatively done to make real and concrete yeah I'm with you and I and I think I'm with the thrust of your remarks and and as a former Director of National Intelligence I'm more than aware of some of the complications that would it be involved in negotiating about the theft of intellectual property and so forth but what you're suggesting and it's obviously for another day but is is this broader issue of whether the two countries or to engage in a much bigger scientific dialogue between them where is science going if you and I are on Weibo this morning talking to 100 million Chinese 15 million of which are in Wuhan and said do you think Australia Australia you think United States and China should have an immediate concentrated scientific research collaboration on on the development of vaccines the treatment of viruses like the corona virus or on this I think you'd get a majority of fourteen point nine million to one that of course this is just self-evident have we had an outbreak of a communicable disease here which was exotic which is always possible you know these things transcend geopolitics like climate and so therefore on the question of agency in diplomacy when I look at Mike agree four of my five part hierarchy push out in these areas of climate collaboration and frankly global communicable diseases because these are common challenges for the human family right well we need to go to questions from another yes go ahead if we could get a microphone if you would please identify yourself and ask a question good morning my name is Sun Jinsheng on partners mr. prime minister ambassador thank you very much but lucid and succinct insightful and fact-based remarks so my questions samples John by the way and my question to you in economic issues in 2019 Chinese GDP close were the slowest one and a six point one percent peppermint I guess the lowest and put it has 29 years and also Chinese confronting with a low birth rate so my question to you our prime minister a what Adam the short term and challenging issues put up she's in pain and second and you are president to Commissioner who's Robin Deloitte and says she will create a geopolitical commission who's over your views thank you very much let me just answer the point about a couple of xi jinping challenges because there's a vast topic but to immediate once and you've hardly touched on them is those of us who assume the permanent linear nature of China's economic development need to always bear two things in mind demography is a destiny China's national workforce began shrinking in size three years ago the population will peak sometime in the 2020s with an aging population the ultimate contest in Chinese domestic politics were between the budgetary allocations for China's health and aged care and Social Security system on the one hand versus the PLA on the other so think through that as a as welcome to the club welcome to the club and this one is actually what I say to my Chinese interlocutors one younger woman that should yell which is these things challenges result and the second is that China's economic success I want so now is depended on a unique form of Chinese political economy and the political economy model has been won the post dong period which basically said this with the Chinese Communist Party will maintain control over ideology will maintain central political control and we're going to create more and more space for the Chinese private sector so you guys to go out there and create wealth and if you've seen that great formulation by Chinese Vice Premier Li all her in recent times starting in late 2018 which is called the wooly old chief agile the five six seven eight nine formula which is we the private sector in China generate more than 50% of the tax sixty percent of the employment seventy percent of the of the innovation eighty percent of something else I can't remember what the rest of the sequence was he was saying to the whole Chinese body politic including to see Dada uncle she guess what we don't have a vibrant private sector in this country we can't assume that this is going to continue so here's the second challenge don't stop at this if as Xi Jinping further centralized his political control and seeks to create further constraints around the free operation the private sector which there's been some manifestation in the period of 16 17 and 18 in a number of policy domains most important of which is credit policy then suddenly you have a whole new set of weights in the saddlebag for China's historical growths assumptions even against the natural slowing of economic growth in any country's economic evolution changing in midstream the political economy of the country and not correcting course is the second big I think fundamental challenge for China's leadership yes in the back there I Marilee international trade today two questions one on Y way the Defense Department's slowing of the Commerce Department's dictates on export controls because of their concerns about what it would do to American chip makers if y'all have a thought on that on what that bodes and then on the cease fire of course the vast majority of tariffs are still in place do you all have any thoughts on if there's a different president next year Biden warned or Sanders what what they might do on those terms these are both profoundly American questions what do you think John well I mean on the first point I think it just I think it's the Department of Defense's way of why it's finally somebody calling to our attention that this issue is more complicated than it may seem on the surface and that there are actually some beneficial transactions that are taking place between Huawei and different elements of our economy and if I remember correctly there's been some kind of license exception put in for every several months and the Commerce Department repeatedly has been renewing them so I mean this technological war is going to be complicated if that's what we enter into on your on your second point I I dare not speculate other than to say that there is the issue of whether there will even be a serious Phase two negotiation or whether we might go back to the drawing boards in in some way shape or form I I just don't know no I think we will have a ceasefire under current terms on trade for 2020 and beyond that fasten your seatbelts anybody could go anywhere and I think that's both from the Beijing and the Washington perspective although I guess we should add that I've been concerns about China's behavior both political geopolitical and economic it's not a partisan issue I think in this country I think this is a fairly strong bipartisan it may be amorphous somewhat amorphous but there is a consensus of sorts I mean to go all the way back to Chuck Schumer and the currency manipulation and so forth they've been people on both sides of the aisle who have had apprehensions about China's rising economy well not neither of us know that and you know President Trump is captained tariffs he loves this stuff I think it's economic madness missile because I have a very old fashioned for a center-left progressive like me I just have very old fashioned view that free trade is good for everybody I know that's unfashionable these days and pickly coming from the set of left where I come from but it does it has in our national experience and across the Hickam economic history of modern East Asia being the central driver of rapid economic growth and if you close your economies guess what you tend to engender the reverse Miami footnote by the way on chips and semiconductors and even supercomputers you spend a bit of time with the semiconductor industry in this country as I have the and you speak to those girls and guys about their industry their ability to reinvest to make this country so dominant in the semiconductor industry of the world hangs in large part on their ability to continue to export to China so if we're going to shut that door leaving aside whether the Chinese can become nationally self-reliant across the whole realm of chips and semiconductors or not if America US government thinks that it is doing an enormous national service to shut that door to that industry's future growth then will the United States government then step in as a massive additional step of industry policy to supplement in the order of tens of billions of dollars each year the current private R&D effort by that industry to remain global leaders so this is a really complex equation for what is an enormous lead dynamic industry of which this country should be proud and your national capacity and chips and semiconductors is formidable between yourselves Intel and other companies at in tsmc and Taiwan and throw in Samsung your writ for the world and you know it's a great tribute to you so just be very careful I think about where that all goes gentlemen we're in the back there yeah we got to get you a microphone Thanks Jacob Gruber from the Australian Financial Review thanks for taking my question it's just a quick first order just a quick follow-up on the huawei comment that you made and it links to the broader industry policy thing I think you were just alluding to what do you think of Britain's decision in the last few hours to basically take a softer line on highway then Australia in the United States have what does that mean for that five eyes relationship and what does it mean then for countries like Australia in the United States on this particular issue of 5g if we are pulling down the shutters do we how do we get the alternative access to this technology I will duck and weave on the latter because I don't wish to provide a generalized answer which isn't reflective of the realities which the industry faces in Australia so I just want to Park that one to one side you asked me specifically however about the British decision implication for five eyes as in evidence by my earlier answer here I haven't read the full text the British decision I didn't read the news reports when I worked in here this morning so I'm always careful about commenting on stuff that I don't know I've been very mindful of the fact that you had recent statements attribute the US administration that unless Britain went America's Way on highway and 5g not only would the five eyes relationship potentially suffer but so too would the speed with which the United States transacted a bilateral free trade agreement with United Kingdom as well I've seen that as well so but I also know you don't have to be a Rhodes Scholar in politics to work this out that Boris and the trumps Joe get on pretty well and it sounds like a movie doesn't Boris on the Trump stacks the the and so I know enough about politics to know that there will have been some dialog up the middle of all this so all I'd suggest is rather than provide some you know dramatic or less traumatic minor headline from me in your paper tomorrow about good bad evil good blown up five eyes or not I'd rather a read the text BB get a handle on the internal political level conversations which would have happened between number ten and the White House on this I would think it inconceivable given the advantage which the British provide to the five eyes relationship that the Americans will just draw a line somehow and say that's it it's just not a lot of the nature of these relationships which have evolved since 1945 for God's sake and before and secondly when I said before it sounds like a British fudge well the Brits would say fudges are good because they can find your way through a welter of complexity so what's the answer the question it hang if I get the dish decision correctly it'll defend on the British decision or definition of the core what core the system will be as it were Huawei exempt or Huawei free and I would rather see the detail that unfold before providing any definitive statement over here right Thank You Mikey Anderson retired foreign service officer you haven't said anything about the state of people-to-people ties would you comment on how things stand on that area in light of several of these points one Peace Corps I understand is pulling out of China the status of the Confucian Institute's has become much more controversial and the u.s. is placed controls on Chinese diplomats when they interact with government offices in the US any comment on on any of those yeah and none of them are particularly happy developments but I would make a broader point about the question which none of us can actually quantify how do the two people's feel about each other these days you know it's an old-fashioned view but I think hmm two peoples of these two countries they'll like each other and have actually a deep respect for each other let me just speak for the Chinese side of the equation first in the midst of all this the fact that you still have most Chinese families wanting to send their kids to university in this country and if they can't get in for one reason or another heading to Australia United Kingdom Canada I mean that to me continue to speak volumes of where people who think first of their kids particularly in Chinese traditional culture entrust their kids for the future now I'm not being pollyannaish about this the extent to which there is now new realities universities are being warned by the United States security authorities and intelligence authorities to screen more carefully around the intake of Chinese students particularly and given research programs I'm not naive about the fact that China will continue to exercise scrutiny and greater scrutiny about foreign students in China the similar fears of you know espionage but you know something these in the history of this roots these relationship have always existed and have been managed within the fabric of still a growing people-to-people relationship so I think the key to this question lies in this the ability of the universities of both countries to continue to manage their university university links and for students to continue to be welcomed in the overwhelming majority of cases in both countries if that gets stopped we're in to a hell of we're in to hell Franklin go this has been so much the fabric underpinning fabric of sino-us relations for a century if you go back to the late Qing I look at the first batch of Chinese students who arrived here if you'll go back to quote the the the box of scholarships coming out of 1919 hundred and one which educated generations of Chinese in this country I mean there are millions of six seven million Chinese now have been through American universities in seventy eight think about how this informs a-league views in China of this country it's huge its indirect but it's palpable you cut that off I think at each country's peril and I really worry about and I've given speeches on this before is that whatever concerns the US intelligence security authorities have that should be prosecuted technically specifically pointedly and without triggering any form of new McCarthyism that would really worry me yeah I mean there's sort of an incipient scare if you will China scare going on and I think it's influenced some of these things but I noticed that the student numbers are still pretty high I think they're upwards of three hundred thousand a year coming from China here's one the question was asked earlier on trade and if there's a different party in power in the white house the Chicago Council on Foreign Relations on global affairs did its annual study what was thought to be a very interesting one on what Americans think about foreign policy and there's a graph in there on which party or adherents of which party are more concerned about the us-china relationship and more worried about the quote unquote Chinese threat and it is a clear discrepancy between Republicans and Democrats so if Democrat were to occupy 1600 yes with the Republicans being more worried and so I think if there were a change in the occupancy of the White House that might affect this specific issue that you just raised now you know these things that was a snapshot back in last September I don't know whether things have evolved since that time I guess we have time for one last question yes ma'am and we just get you a microphone hi my name is Elizabeth Gelb I work with Deloitte but my question comes from I used to live in Xin Jiang so I was wondering what role if any you thought human rights will play in this strategic competition so I know the Senate has made some like isolated efforts to address this but it hasn't been a continued part of the negotiations and so I'd be interested to hear your thoughts about Xin Jiang what role it can play in in this strategic calculus and if there's any role for the global community to play the question of human rights it has been a constant in the us-china relationship since diplomatic normalization in 79 and that's not going to change secondly China's approach as you know is that whether it's US national protestations on human rights or actions such as those you've seen recently United States Congress and shinjang or Hong Kong none of America's goddamn business because these are internal affairs we all know that that's the the pattern of the the exchange but thirdly it's also true that because policies in Xinjiang have changed under siege in ping that the both in the reaction the United States and by other countries around the world is going to get sharper and sharper you saw that most recently it's true the UN resolutions on Shin Jang but what's fascinating about the UN resolutions on Xinjiang is this look at the numbers those who took a position against China's policies in Xinjiang where frankly the Western Club by and large with only one is one Muslim state Albania of the 50-plus members of the organization in Islamic Conference our Chinese friends managed to get all of them to either vote with China or to abstain and so therefore the activism of Chinese defensive diplomacy around this question right around the world including in the Muslim world has been a phenomenon to behold and I think the Western community of nations around that particular resolution are still in some level of shock about how thin the overall vote was in fact from memory there are about 23 votes in favor of the British sponsored resolution and I can't remember the number against and how many abstentions but the actual reflection of the the rest of the Muslim world was what I think stunned most international observers so the final point is my own engagement with our Chinese friends on human rights which has been direct privately direct publicly over many many decades has simply been this we recognize the improvement in the Chinese economy we recognized the improvement in living standards right across China and frankly including in the most difficult parts of the country including Xinjiang Tibet and elsewhere however we and China are both signatories and ratification states the Universal Declaration of Human Rights in 1948 China has signed but not ratified the International Covenant Civil and Political Rights China has signed and ratified the International Covenant and social economic rights and so my council would be for those engaging China on these questions as anchor your positions in international law anchor your anchor your position in the Covenant arrangements would govern us all rather than as it were selectively episodic positions which we pull out of the air on a particular issue on a particular day I find that is a much more systematic way in which to engage our Chinese interlocutors well ladies and gentlemen please join me in thanking Kevin Rudd for thanks and thank you John for being part of the conversation for answering all the hard American questions there's a good division of labor thank you ladies knew it coming today thanks very much

Channel: Asia Society

Views: 35,086

Keywords: policy, asia society washington dc, program, aspi, kevin rudd, john negroponte, wendy cutler, china, u.s.-china, relationship, the avoidable war, speech

Id: dUdk1m-GTgA

Length: 83min 48sec (5028 seconds)

Published: Wed Jan 29 2020