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1 Copyright USF Center for the Pacific Rim The Occasional Paper Series of the USF Center for the Pacific Rim :: Pacific Rim Report No. 14, April 2000 Asia: No Longer a Monolith A discussion with Michael Oksenberg This Pacific Rim Report presents the second in a series of Pacific Rim 2000 Briefings entitled "Asia: No Longer a Monolith" held on March 15th this year. Cosponsored by the USF Center for the Pacific Rim and the Commonwealth Club of California, the briefing featured China expert Michel Oksenberg, Ph.D., in conversation with journalist Marsha Vande Berg, Ph.D. The evening program, held at the Commonwealth Club's downtown San Francisco headquarters, was introduced by University of San Francisco president and Commonwealth Club of California Executive Committee chair, Rev. John P. Schlegel, S.J. Michel Oksenberg is a senior fellow at the Institute for International Studies at Stanford University, where he is also professor of political science. He writes and lectures on contemporary China, Asia Pacific affairs, and on American foreign policy in the region. His research specialties include Chinese domestic affairs, China s foreign policy, Sino- American relations, and East Asian political development. Earlier in his career he taught at Columbia ( ) and the University of Michigan ( ), where he was also director of the Center for Chinese Studies. From 1977 to 1980, while on leave from the University, he served as senior staff member of the National Security Council in Washington, D.C., with special responsibility for China and Indochina. From January 1992 to February 1995, he served as president of the East West Center, a federally funded research and training institute in Honolulu. Oksenberg is the author of numerous books and articles including China: The Convulsive Society (1971); Policy Making in China: Leaders, Structure, and Process (1988); and China s Participation in the IMF, the World Bank, and GATT: Toward a Global Economic Order (1990); A United States Policy for the Changing Realities of East Asia: Toward a New Consensus (1996); Living with China (1997); Shaping U.S. China Relations: A Long-Term Strategy (1997); The Chinese Future (1997); and co-editor of China Joins the World: Progress and Prospects (1999). Oksenberg s B.A. is from Swarthmore College (1960), and his M.A. (1963) and Ph.D. (1969) in political science are from Columbia University. IIn discussion with Dr. Oksenberg,erg, Marsha Vande Berg has worked for major U.S. dailies, in television, and as an editorial consultant. She has taught at the University of California, Berkeley, and she is a member of the German Quandt Foundation s Transatlantic Forum. She was also a 1997 Salzburg Media Seminar fellow. Vande Berg s education includes a Ph.D. from Vanderbilt University and an M.A. from Duke University. We gratefully acknowledge the Kiriyama Chair for Pacific Rim Studies at the USF Center for the Pacific Rim for funding this issue of Pacific Rim Report. Marsha Vande Berg (Vande Berg): Michel, please describe the China of today for us. Michel Oksenberg (Oksenberg): China is in the midst of enormous change, yet also forever China. As to the enormous change, consider that this vast land of 1.3 billion people is in the midst of transformations that took 200 or more years in the West. I m speaking of the transformation from an overwhelmingly rural society to an urban one, and from a predominantly peasant society to one of great diversity in occupations, including (I am not sure whether I am pleased in saying this or not) lawyers, with all that implies for the guarantee of legal rights. China is also in the midst of industrialization, with an increasing percentage of its GNP generated by the heavy industrial sphere and the service sector. It is a society being transformed by the telecommunications and transportation revolutions that, of course, have also affected us. But even with rapid changes in the society, in the economy, and also to a certain extent in the culture, there are also continuities evident in

2 China. These continuities entail a certain persistence of traditional values and a political system that is changing more slowly than the economic and social domains, and, to some extent, perhaps, is beginning to constrain the rate of change in the economy and the society. Above all, one must think of China as a very diverse land, and not at all a monolithic society, a point perhaps best exemplified by the 8% of China s population nearly 90 million people made up of minorities and occupying the peripheral, border regions. China s diversity can also be captured in another way: I believe there are five great cuisines in the world. The first is Sichuanese, the second is Pekinese or Shandong style, the third Shanghainese, the fourth Cantonese, and the fifth would be debatable French or Italian. And we know that both of those derived all their sauces from China! Vande Berg: Well, that begs any number of questions about whether you are a cook or not, Michel, but let me stick to the topic of China. Do you think that there might be a Chinese Gorbachev waiting in the wings? Oksenberg: No, I don t think that a Chinese Gorbachev is on the horizon, and certainly the Chinese hope that there isn t one because most of them believe that Gorbachev s policies led to the dissolution of the Soviet Union, and, from a Chinese perspective, to disaster. And that is not just a governmental view, in my opinion. It is beyond question that the years since the reforms began in China in 1978 are the best 22 years and more in over 150 years for China and the Chinese, and both the leadership and the populace have one overriding concern among their many, many concerns: not to lose the progress that has been made in the past 22 years as they continue to try and develop. So, if you suggested to the premier of China, Zhu Rongji, that he is a Gorbachev, he would hasten to say, Thanks a lot, but don t apply that name to me. In any case, I would say that there is not going to be a Chinese Gorbachev because the Chinese path will certainly grow out of its own history, its own culture, and will be a response to its own problems, which are not the same as those confronted by the Soviet Union at the time when Gorbachev came along. One of the main points that I would make (and one of the reasons why I answered the first question the way I did) is that China still retains its distinctiveness. It is all too easy to suggest that what s going to happen to China is just like in the case of Japan, or Germany, or the Soviet Union; i.e., that all great powers rise alike. But I think that in any forecast of the Chinese future one has to begin by first looking at the Chinese condition itself, at where their own internal forces are propelling them, and then not making too easy comparisons. Vande Berg: So, what are those internal forces? Obviously the government, the military, and the people play important roles. Oksenberg: If you look at the present time, it seems to me that the leaders of China are grappling with five issues over the next two to four years, which is a relatively short time horizon. In other words, what is the agenda of issues currently confronting the Politburo, the Standing Committee, of the Chinese Communist Party? First, Taiwan. This is not an issue which the leaders of China would necessarily have wished to put at the head of their agenda, but it is there partly because Hong Kong has returned to Chinese sovereignty, as has Macao, and now Taiwan, from their perspective the last of the areas of China (with perhaps the exception of Mongolia) taken away from China during its protracted period of humiliation at the hands of the outside world from mid-19th century on. So, the leaders are increasingly focusing on Taiwan and they see Taiwan, perhaps incorrectly, drifting away from the Mainland. Now, I have to say that there s a reason that Taiwan is drifting away from the Mainland; the Mainland is not that attractive. The Mainland s approach to Taiwan, as Tom Friedman has pictured it in the New York Times, is a little bit like someone courting a potential mate and saying, Marry me or I ll kill you. This is not necessarily a line that wins great affection. It s a complicated picture and the leaders of China are nervous because none of them wishes to go down in history as the person who lost Taiwan. I ll quickly tag the other four (you see, I have a 40-minute lecture on this subject; professors can t really speak in three-minute segments!), and these are: the succession [after Jiang Zemin], maintenance of social stability and order, how to deal with the military in the reform process, and finally, how to keep the economy going while reforming it to make it even more congruent with a market economy. Vande Berg: I think as Americans we all struggle with how to understand this vast and complex country with so many, many people. Your catalog of issues on the Politburo s agenda is very helpful. Could you flesh it out with some insight about who China s leaders are, especially Jiang Zemin and Zhu Rongji? Also, inside the Politburo and the Standing Committee, what are the tugs and is power shifting from one person to another? Oksenberg: It s a very, very difficult question, Marsha. First of all, let me emphasize a certain amount of modesty. Not only about understanding China as a whole; it is so large and so complex, with so many diverse traditions, that to be a student of China, as I am, is an exercise in total humiliation. But one learns in this field not to allow ignorance to prevent one from speaking! That would be a disaster! I have met with many of China s leaders in a variety of groups and settings, and yet I must recognize that our knowledge, particularly of politics at the highest levels, is limited. But, to focus on Jiang Zemin, let me say that to be an effective leader of a country such as I have described necessitates four qualities, which I will evaluate Jiang against when I am done. First is a certain lust for power a dash, if you will, of megalomania, to think that one could lead this significant a portion of humanity.

3 Second is a ruthlessness, a demonstrated capacity to deal with adversaries if you will, to be a bit of a thug. This is a political system that has an element, and ever more so, of Mayor [Richard J.] Daley s (not the current Mayor [Richard M.] Daley, but his father s) Chicago. Third, any effective leader of China requires a network of personal ties linking the leader to both bureaucracies and networks of individuals who are embedded in the key institutions of the country the Party, the army, the government, and the major regional administrations, particularly the eastern coastal regions and Sichuan province in the southwest. Fourth is a vision for the Chinese future that is somewhat compelling, that galvanizes, captures the imagination of the populace and particularly of intellectuals and younger people. Now, let s measure Jiang against these criteria. He does give evidence of desiring the position that he has. Indeed, he may be giving evidence that he desires it so much that it will be hard for him to leave it as he ages, thereby raising questions about the succession and whether Jiang intends to remain into his late 70s as the leader of China. Vande Berg: How old is he now? Oksenberg: He was born in 1926, so he is 73 or 74. His current term of office expires in 2002, and the question is whether he will abide by the two-term limit to which he and all of his associates agreed at the 14th Party Congress in So, there s that quality. It is also interesting to see that the top members of the Standing Committee of the Politburo, all in their late 60s and early 70s, do not have a single strand of gray hair among them that is visible. I find this to be a little bit interesting. I don t think that this is natural. I don t think that it s a result of a lack of worry. But it indicates something about their personalities and their inter-personal relations that they now feel the need to project themselves as younger than they really are. Mao and Deng let their hair go gray, and as you can see, I am following suit! As for being ruthless, Jiang Zemin, I think, is not as ruthless as Deng Xiaoping, and certainly not as ruthless as Mao was. But an interesting question about Jiang is whether or not he has the total strength to dominate the system. I would say the answer is no, and this is not a bad thing, by the way. This means that decision-making under him is more consensual, more consultative, and Jiang tries to put diverse points of view together. But it also means that there is a lack of decisiveness and clarity, I think, in how he rules. The third quality that I mentioned is a network of ties. Jiang has fairly solid links into the technocratic class, certainly into east China, and to Shanghai, where he spent time. But (putting Sun Yat-sen aside) Jiang is also the first leader of China throughout the 20th century, from Yuan Shikai [the first president of the Republic of China; d.1916] onwards, who s not a military man. Deng Xiaoping was a military man; he could have become a marshal [the top rank in the People s Liberation Army]. So, there is a question of whether Jiang s ties with the military are as strong as they ought to be. Finally, we come to vision. Jiang has a wide-ranging intellect. He does speak foreign languages, an ability in which takes some pride. But, if I may be blunt, he has not yet articulated a sense of the broad direction in which he wishes China to move I don t mean economically, since he has made his ideas known in that sphere, but socially and politically, and in a sense, culturally. Therefore, there is a big question about what he desires his legacy to be. Perhaps he is an enigma unto himself on this matter. Vande Berg: If Jiang faced the Hobson s choice of risking war with the United States and its western allies over Taiwan or forward momentum with economic reform, which way do you think he would take his country? Oksenberg: He would desperately try to avoid the choice. Vande Berg: Someone has said everyone has a boss, somewhere. Who, or what, controls Jiang Zemin? Oksenberg: I think he is trying to sustain rapid economic growth, keep the country together, preserve stability, and not lose the hope that China will one day be unified. I do detect on his part an increasing sense of frustration and impatience over the Taiwan issue, and I believe that if he felt that the dignity of the People s Republic of China was affronted by actions that Taiwan took, he would be both sufficiently pressed and sufficiently committed that he would use force. Vande Berg: Turning then to Taiwan, what of the elections coming up there on March 18? What could the outcome mean for U.S. policy and the next U.S. president? Oksenberg: The polls that were taken on the eve of the moratorium placed by the Taiwan government on the public release of polling, showed the three candidates in a virtual dead heat. Those three candidates being Lian Zhan, the current vice-president and candidate of the ruling Nationalist Party; Chen Shuibian, the candidate of the Democratic Progressive Party, more widely supported by native Taiwanese and perhaps more assertive when it comes to issues of autonomy and independence; and last, a breakaway candidate from the Nationalists, James Soong, a Berkeley graduate (but we at Stanford do not hold that against him!), the former governor of Taiwan, and a very capable man with a certain amount of appeal but with some heavy criticism aimed at him during the campaign. I don t know which of these three is going to be elected. I would say that some developments in the last couple of days may suggest a current move toward Chen Shuibian, who is most certainly not the preferred candidate of the Mainland. Chen Shuibian has in his public rhetoric during the campaign sought to moderate his stand, and has sought to disassociate himself from the stand of Taiwan independence, but based both on private conversations and public statements, most of the top leaders in China think that at

4 heart he is a Taiwan independence person. To give you a sense of the currents on Taiwan, his vice-presidential running mate, Annette Lu [Lyu Xiulian], attended a conference in Japan in 1995 convened by right-wing politicians to recall the 100th anniversary of the Treaty of Shimonoseki, which marked the Japanese defeat of China in the Sino-Japanese War [of ], a moment of great humiliation to most patriotic Chinese. She gave a speech which the Chinese on the Mainland well know in which she said the 1896 defeat was not necessarily a tragedy because it was during this war that Taiwan began to have its own modern history. This is not a position which endears her to the people on the Mainland. So, I frankly do wonder how the Mainland would react to a victory by Chen Shuibian. I would think from his public statements that he would be very careful during the interim period from the time of his election to the time of his taking office. He has stated during the campaign that he would not change the constitution, that he in fact thinks that Taiwan is already independent so it doesn t need to declare it. That said, I would anticipate that a Chen Shuibian election would possibly lead to some heightened tension in the Strait. Vande Berg: What will be the outcomes for U.S. policy toward Taiwan and the Mainland? Could U.S. policy change? Oksenberg: No I think American policy is, despite some of the occasionally vague formulations of it, rather clear. Our policy toward Taiwan is governed by the Taiwan Relations Act and by a deeply felt sense of obligation on the part of the American people toward the people on Taiwan, enhanced by their becoming increasingly democratic and, of course, prosperous. The United States would support Taiwan militarily in case of an attack from the Mainland that was not provoked by actions on the part of Taiwan, and this is the message that the Clinton administration and other administrations before it have attempted to deliver to both sides. The question is whether the seriousness of that message is well understood by both sides. From this point of view, the United States remains enmeshed in the legacy of the Chinese civil war. Vande Berg: A member of our audience has submitted a question asking whether U.S. involvement and interest in Taiwan is necessary or does it amount to interference? Oksenberg: I believe that over the past 20 years U.S. involvement has contributed greatly to a better relationship between Taiwan and the Mainland. I have to step back however to ask; what is the broader strategic configuration in East Asia? To me, the United States has become tragically involved in three wars in Asia in the last century World War II, the Korean War, and the Vietnam War in no small measure because of the underlying tensions between Japan and China. We cannot forget Japan in any discussion of what the United States ought to do in the region. Beginning in the early 1970s American foreign policy finally brought an end to Sino-Japanese animosity so that the United States could have good relations with both simultaneously. During the prior century, the United States could either have a good relationship with Japan and hence a bad relationship with China, or a good relationship with China and hence a bad relationship with Japan. But it is simultaneous constructive relations among all three that is fundamental in any American foreign policy in the region. Taiwan has prospered under these constructive trilateral relations, so the American interest in Taiwan is serious, but derivative of the broader relations among the major powers. I am a realist when it comes to international affairs, and I believe you have to get the major power relationships set right first and a lot else will follow from that. Therefore, U.S. interest in Taiwan is obviously very positive, but we pursue that interest most effectively by having a good relationship with China and a good relationship with Japan. Within this context China has for had over the past 28 years every incentive to improve relations with Taiwan, and Taiwan similarly with the Mainland. So, you can t just ask what is America s interest with respect to Taiwan; you have to ask what is America s interest with respect to the region as a whole, and how can the U.S. pursue a regional strategy. Then you can move towards the subsidiary parts of the relationships. Vande Berg: Bringing Japan into the question suggests a very different triangle from that constructed by the late Richard Nixon to effect the thaw in U.S.-China relations in Nixon s triangle, if you will, was Washington, Beijing, and Moscow. Oksenberg: The U.S.-Japan-China triangle is a very constructive triangle. In the case of the Sino-Soviet-American triangle, there were rivalries which the U.S. sought to manipulate. With the present configuration U.S. strategy has been, and I think should continue to be, to nurture constructive relations among all three major powers. Now, let us understand Taiwan. Taiwan s position is Thanks a lot; but you are the big guys, and we are afraid that you may sacrifice our interest to the larger context. What will become of us? We are not simply a disposable tissue here. Vande Berg: This is certainly not an unfounded concern on the part of Taiwan, considering the precedent of 1978 [when the U.S. derecognized Taiwan in favor of the People s Republic]. Oksenberg: Indeed not. One has to be sensitive to the past with Taiwan, just as we are with Korea. But from the strategic picture that I was trying to articulate, one has to recognize that Taiwan, Korea, Indochina, the Straits of Molucca, etc., are places where the interests of the major powers intersect and frequently come into conflict. What one has to do is make sure that conflicts of interests among the major powers over these places are managed well, and that you pursue American interests with respect to the key places in the region.

5 Vande Berg: Michel, you were the number two person in Washington to Zbigniew Brzezinski when Brzezinski was President Carter s national security advisor. You found yourself front and center to a whole range of activities, including a bit of internecine White House warfare, but succeeded in winning an important entrée with the Chinese for your boss at a critical juncture in the Sino-American normalization process. This year being a presidential election year where the outcome could make a major difference in U.S. foreign policy objectives, how would you advise a President Gore or a President Bush? Oksenberg: Three points. First of all, be clear. When Vice-President Gore debated Senator Bradley he was asked a question about China, and he said he supported a policy of deliberate ambiguity. I would say to Vice-President Gore, even if you are pursuing a policy of deliberate ambiguity, never say so! It simply invites both sides to explore the area of mushiness to their advantage. I would emphasize the need to be very clear and very strong on what American interests are with respect to security as I have outlined, and with respect to our economic interests, with respect to human rights, with respect to environmental concerns, and so on. Second, be consistent. I don t want to inadvertently give you the sense that I fall into what I feel very strongly is a serious American problem now of excessive arrogance in our conduct around the world. but the reality is that temporarily we are the polar star of the East Asian security architecture. Others orient themselves to us because of our economic might, their reliance on access to our markets, and because of our military preponderance in the region and our relative technological superiority. Yet, I have to say the Clinton administration has not pursued a consistent policy toward China, so that no one knows how to align themselves. This lack of consistency by the president and the executive branch opens up the issue for everyone to fill the resulting vacuum, including congress and various interest groups. So, be clear, be consistent, and finally, be coherent. And by coherent I mean the United States cannot pursue a policy toward China and Taiwan alone. We have to pursue a policy that will generate the absolutely essential support of Japan, as I have indicated earlier, and of Korea, and of course, of our Southeast Asian friends and partners. Vande Berg: It seems we might very well have the same dilemma in the United States as the Chinese do whether our economic interests or our security interests come first. Then, we have to factor in the human rights issues that matter a great deal to us and our concerns about Tibet, and so forth. I applaud your advice to be clear, consistent, and coherent because you seem also to be suggesting that Washington has to be clear, consistent and coherent vis-à-vis the American people as well when it comes to this vast and complex country. Oksenberg: That s right, and I would add one other remark because the basic posture that I have supported for my entire career is one of welcoming China s entry into the international community, economically and culturally. So, I support a policy of being forthcoming. At the same time one has to be realistic. It is possible that this major effort by the international community to welcome China s emergence on to the world stage, which has now largely happened, could turn out to be harmful to our interests. It could be that China may in the years ahead embark on an expansionist path. I think that s unlikely, but realism dictates the recognition that it s a possibility. Therefore, even as we are forthcoming toward China, we have to have an insurance policy in case things go wrong. The insurance policy shouldn t be at the level that it will prevent what we are trying to accomplish, and it shouldn t be an insurance policy that will bankrupt us in the process. But, we do need an insurance policy, and that implies particularly the continued robust American military presence in the western Pacific, maintenance of our alliances with Japan and with Korea, and forward deployment of our forces, even as on the economic side we promote, for example, Chinese membership in the World Trade Organization, or seek to involve China as much as it wishes in various international fora that deal with security issues. Vande Berg: Your position on being forthcoming certainly comes out loud and clear in the book you have co-edited with Elizabeth Economy, China Joins The World: Progress and Prospects. Could we take a little closer look at China s economy? What are the factors that could alter the present situation for better or worse? Oksenberg: Over the longer term, the underlying dynamics of China are certainly affected by ecological and environmental issues on the one hand, and demographic issues on the other. Although these issues don t make it into the newspaper, one has to realize the enormous pressures that this increasingly industrializing society is placing upon the natural environment. There is a serious question as to what constraints on growth will come out of these areas. There is also, of course, the issue of China s increasing population. Its rate of growth has slowed through a vigorous, some would say draconian, family planning program, but still the burden of the Chinese population is very great. Turning to some of the underlying issues of the economy, it seems to me that the leaders face four major problems now, all well reported in the press. The first is the reform of state-owned enterprises that are highly inefficient and a drain on the government budget. Second is a banking system that is not governed by commercial principles, but rather is one in which banks are primarily development banks subject to political pressure so that the percentage of non-performing loans that these banks have made is rather high and worrisome. Third is the Chinese government s revenue collection system, which is not very effective. This comes as a kind of a contradiction, but then China abounds in contradictions. Indeed, one of the problems with studying China is that everything you say about it is true and the opposite is also true. You think of China as having very effective control, to wit, the ability to penetrate the bedrooms of a significant portion of the

6 population for family planning purposes, but at the same time China s total central government and local government fixed revenue through regular taxation, as a percentage of GNP, is 14-15%, one of the lowest of any economically significant country in the world. Everyone recognizes that China has to develop a more effective internal revenue system; they can t deal with their banking system unless they have an effective internal revenue system to take its place. One of the reasons there is such a perception of corruption in China is that local units must raise their own revenue through fines, fees, and extra-legal means in order to fulfill their mandates. China is run, even more than our own country, on un-funded mandates, a term that we understand very well. Fourth is an adequate social security net, because the state-owned enterprises at the present time are in effect the providers of social security to the unemployed and to retired workers. So these four are totally inter-related problems. The Chinese have made some progress in dealing with these four problems, but they have by no means solved them and this set of problems continues to be a real weight on the economy. Vande Berg: Here s a question submitted by a member of the audience that I cannot resist. What impact is the Internet having in China? Do you think it is speeding things up? Oksenberg: It s coming, and it s enormous. We all know in the end that this phenomenon cannot be controlled. I have seen the transformation of the telecommunication systems in China through some research that I ve been doing, and clearly there is much more dissemination of information now, and it s easier to communicate. The Falungong, this sect that has at least for a while spread in China, was using modern means of communication to disseminate its beliefs and even to organize its people. So, the internet is eventually going to transform China, but, just as in our own society, I think it s far too early to come to any firm conclusion about what all this really means for humanity, or even for local communities. What I would say is that the telecommunications transformation and new information technologies will simply intensify all the pre-existing trends that were occurring in China, but those pre-existing trends were bewildering in their diversity. We have increasing nationalism, regionalism, communitarianism, individualism, provincialism, all simultaneously. I suspect that all such trends will be reinforced. Vande Berg: But could it be that reform is irreversible and that something like the Internet forces the pace of change to accelerate? Oksenberg: I agree with that, but I also do not think there is some predestined outcome of the reform, Marsha. Let me give you two vastly over-simplified and contradictory trends. One is a move toward an unregulated market economy; raw capitalism, if you will, something like some of the Southeast Asian countries experienced, with a great deal of crime, high levels of corrupt, no legal enforcement of contracts, etc. Another path might be toward a more well-regulated market economy, while a third possibility is such an erosion of authority that the rate of growth would eventually be affected. Now, all three of those you can say would encompass significant changed in the system. What your very insightful question points to is that it is unlikely that the present system can indefinitely persist because there are tremendous strains on the role of the Party, the role of the leaders and how authoritative they can be, and the way in which the country is unified. So, China is going to change politically, but exactly how, I really dare not say. It is unknown. There is also another possibility; that the leaders will try to pull things together through virulent nationalism. Vande Berg: You mentioned environmental concerns about China. Here s a population that is growing very fast as is their need for oil and gas. In our closing moments, how do you see China approaching its growing need for natural resources? Oksenberg: As we all know, the process of industrialization requires the increased use of inanimate energy, whether consumed in the form of coal, petroleum, or natural gas, or from electricity generated in some fashion. The Chinese situation is that its vast natural resource is coal, abundant coal, but the use of coal has deleterious environment consequences. So, there is a pressure to move toward natural gas which requires pipelines, etc., and conversion, or petroleum, and Chinese development and production of petroleum has not kept pace with demand. As a result, China has become a significant importer of petroleum and that is likely to continue. Now, much of that petroleum comes from the Middle East and this makes China increasingly an actor in the Middle East, and a potential actor in the development of Caspian Sea oil. One can detect now that aspects of Chinese foreign policy are related to a longer-term vision of its energy sources, but there are people in our audience who know much, much more about this than I do. Vande Berg: Do you see this growing dependence on imported oil acting as a force to bring China more into the world community? Oksenberg: Yes, and it already has done so. But again, the question is, how will it bring China into the world community? Will it emerge as an assertive force, or one bound by the international market and by its sources of supply? Vande Berg: There is some concern voiced that China might turn expansionist in its interest in acquiring sufficient oil and gas fields. What about that? Oksenberg: There are two ways of expanding. I wouldn t say that the United States has been exactly a wall flower in the pursuit of its energy needs abroad, but the question is will China resort to military might or will it behave in a commercial sense? The Chinese National Petroleum Corporation as well as the China National Offshore Oil Company both announced that they re seeking funding on international money markets, and already they both have made oil field purchases, in Venezuela, in the Middle East, and even in Indonesia. If you are a person who sees evil in every action the Chinese undertake, this is a terrible development; here they come! But, if you say, no, this

7 is a positive development because they are acquiring a stake in a more stable and orderly marketing system for energy, then this is a good development. And down deep, as we come to the hour, every person who looks at China is making some very basic assumptions about what is the core nature of China s rise in the world. On balance, as I indicated, I have my concerns that require an insurance policy, but I think that China s rise in world affairs will prove to be one of the major beneficial developments of the last part of the last century and first part of the present one, and for two major reasons. Moving away from the strategic considerations I mentioned earlier, China can be a locomotive for worldwide economic development, for example. But even more important in my view, over the long run, the greatest source of tension in the world is between the rich and the poor, within countries and among countries. And here we have a country that is developing, and with its development, in one fell swoop, we are beginning to eliminate one of the largest sources of world poverty with all the vulnerabilities and sources of tension it produces. So, my basic view is that you have to look at this from a long term historical viewpoint. It means that we have to gird ourselves for a lot of complexities in this process because it isn t going to be easy. China is not going to become just like us at the snap of our fingers, overnight. Their development will take a very long time, and cause us enormous headaches. John Fairbank once said that China joining the world is a little like a camel sticking its nose under the tent, but it is better to have him inside than outside. The University of San Francisco - Educating minds and hearts to change the world - since 1855

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