How Insecure is Pacific Asia

Gerald Segal
(International Affairs, Spring 1997)

part one of two

Thinking about security in East Asia can be a perverse process. Consider the fact that the past three years have been the worst for East Asian security in 15 years, and yet this has been the most peaceful generation in East Asian security for several centuries. What is going on? In 1993-94 we had a major crisis concerning Korea, in 1995 we worried about conflict in the South China Sea, in 1995-96 we had the worst tension in the Taiwan Straits in nearly forty years, and in 1996 Koreans Japanese and Chinese squabbled over disputed islands. But all these crises have helped develop new ways of coping with regional security and give hope to both realists and idealists that serious action is being taken to ensure regional security. Out of crisis comes opportunity.

Just what makes the best international security is seriously contested, and of course this is not the place to fully explore the debate. Suffice it to say that there appears to be four major components of security for any region, none of which on their own is sufficient. By far the most important factor for international security seems to be the emergence of pluralist (democratic) political systems. While it is true that no well entrenched democracy goes to war with another similarly robust pluralist political system, it is true that newer and more fragile democracies are more liable to slip into serious tension. The latest (1996) round of tension between Greece and Turkey is a case in point.

A second component of international security is a close economic and societal interdependence between states and societies. Of course, such interdependence on its own is far from sufficient protection from war. The degree of economic interdependence (measured by trade as a ratio of GDP) in the 1990s is little different than it was in Europe a century before, and we all know the results of the war that began in 1914.

A third factor enhancing security is the creation of international institutions and formal agreements that restrain state behaviour through co-operative behaviour. As the experience of the League of Nations or inter-war arms control agreements in the Pacific suggests, neither institutions nor formal agreements are in-and-of-themselves guarantees of security. But the process of reaching formal agreement by-and-large builds confidence and enhances transparency.

A fourth factor in ensuring security is a stable balance of power. Rapid changes in power balances or major uncertainty about the will to use power to constrain de-stabilising behaviour are clearly damaging to international security. Of course, balances of power can be part of the security problem, especially when they are more rigid than the fast-moving economic and social realities that underlie the military balance.

These four factors that determine the state of regional security will provide the structure for the ensuing analysis of the prospects for regional security in Pacific Asia. But taken together (as they rarely are), they suggest that despite the recent spate of crises, East Asians may be constructing a more robust regional security. There is far more to do, but recent gains should suggest a strategy for the road ahead.

Democracy and the Litening of Pacific Asia

If all of Pacific Asia were rich and had well-established pluralist political systems, there could be much more confidence about regional security. Rich democracies tend to become "Lite powers". These Lite powers tend to have populations with few children and therefore parents are more averse to risking conflict. With fewer young people for the armed forces, there is a tendency to develop professional armed forces rather than conscript armies. Professional armed forces tend to put greater stress on expensive hardware and are therefore very sensitive to the high financial cost of warfare.

Countries with pluralist political systems tend to be more diverse and complex. They tend to be more understanding about differences with others and more sensitive to the need for political compromise. They tend to appreciate the joys of criticism and the healthy role it plays in society. They understand that not all criticism and rhetoric is a cause for tension and conflict. When one pluralist political system confronts another obviously pluralist society, there is a greater willingness to tolerate differences and seek peaceful solutions. When the enemy is seen as a dictator unrepresentative of popular will, it is easier to justify conflict and see one's own behaviour as sensible and rational.

If we adopt a long term view of human history, it seems clear that the "litening" of states is inevitable for those who grow rich. The ability to sustain prosperity seems to require "less perspiration and more inspiration" as the basis of productivity and prosperity. If rapidly developing states are to continue moving into the class of wealthy, mainly service economies, they will need to create an environment where the joys of criticism are unleashed and innovation becomes more likely. Such criticism and inspiration require a plurality of ideas and a social system that encourages such pluralism. The new rich of Pacific Asia are beginning to recognise that their continuing prosperity requires a change of social and political systems and only now are they beginning to experiment with serious pluralism.

Some societies in Pacific Asia have made remarkable progress towards pluralism and Lite power. Of course, all states in Pacific Asia have the trappings of pluralist political systems. Even North Korea has a parliament and China has a formal constitution that would make Thomas Paine proud. But few countries in Pacific Asia have what might be facetiously termed "really existing pluralism". Only a handful of countries in Pacific Asia have ever had free elections leading to a change of government. South Korea, Japan and Taiwan have been admirable recent cases in point. Only a handful of countries have a free news media or a blind judicial system, and the degree of freedom or unbiased law seems to fit very closely with the propensity to have free elections. Perhaps not surprisingly, South Korea, Taiwan and Japan are the three most economically developed countries (as opposed to city states) in the region. It seems that the inevitable trend is a political pluralism that follows from economic prosperity.

Whether this trend makes Japan, South Korea or Taiwan into more Lite powers, depends on a host of other factors. Japan, in Hanns Maull's well-turned phrase, has long been considered a "civilian power" very averse to the use of force. But this was the result of peculiar circumstances surrounding the Second World War. As the importance of the wartime experience fades, Japan may become a bit more of a "normal" power before it becomes Lite like the powers of the Atlantic. South Korea and Taiwan are both likely to remain unusually militarised until their civil wars are resolved. But the resolution of those civil wars may well depend on the other parts of the civil wars (North Korea and China) becoming more democratic.

Thus while it may be clear that the democratisation of some East Asian states is already well underway, it is far from clear that the risk of involvement in conflict for these states has declined. So long as their pluralist systems are still fragile, and their adversaries still authoritarian, the risk of conflict may not decline. The fragility of newly liberalising societies was perhaps part of the explanation for the flare up of the territorial dispute between Japan and South Korea or Japan and China in 1996. Although these squabbles were well known and long standing, they had been reasonably well submerged until Japan placed the UN Law of the Sea Convention before the Japanese Diet. South Korea reacted in such an exaggerated way to what was merely a formalisation of the already well known Japanese position on the disputed islands, in part because its political leadership was weak and seeking re-election. As in the Greek-Turkey dispute at the same time, fragile democracies find that weak leaders, egged on by jingoistic media, can produce more rather than less dangerous policies.

Nascent democratic politics were also a cause of security problems in the Taiwan-China dispute. The 1995-96 dispute had a great deal to do with the fact that President Lee Teng-hui, who faced the first free Presidential election in Chinese history, felt he had to win support from the centre ground of the electorate. He did so by shifting to greater support for an enhanced international role for Taiwan and sought (and received) a visa to visit the United States. China's exaggerated reaction, and the United States initial havering, created a full-blown crisis and the largest deployment of American naval power in the region since the end of the Vietnam war. But the crisis would not have happened if there were no democratic process in Taiwan and no growing sense among Taiwanese that they deserved greater international status and the right to determine their own future. While Taiwan was not acting in a militaristic fashion, it remains true that the democratic process was a destabilising force for regional security.

Elsewhere in Pacific Asia there are no well developed pluralist political systems. In fact, many of those who resist greater pluralism with vigour, notably Malaysia and Singapore, cite the risks of increased conflict that might ensue from democracy. They fear that ethnic divisions in their societies might be exacerbated by demagogic politicians. They suggest that the values of pluralism are not yet well enough entrenched to be trusted to popular good sense. While it is impossible to judge the extent to which this is merely the self-serving argument of current rulers, it is understandable, especially given ethnic tensions only barely below the surface. It is no doubt true that ethnically more coherent states such as South Korea, Japan and Taiwan have less to fear in this regard and therefore may be less constrained in experimenting with popular pluralism. It may be that the complex ethnic make-up of Southeast Asians states means they will move with greater care towards pluralism. The more ethnically well mixed Thais may be evidence that those with less ethnic fears might be able to tolerate more liberal systems.

However, evidence from elsewhere in Asia, and most notably India, suggests that even poor and ethnically divided societies can cope with democracy. As India's economic growth approaches average Southeast Asian levels, perhaps the argument for Southeast Asian stability based on authoritarian rule may begin to lose some of its currency. There is, of course, no "safe" time for states to experiment with pluralism and ruling elites are usually the last to see the need to give way to pluralist forces. Nor is there, almost by definition, a single path to pluralism or a formula that can be followed. The forces for change tend to burst out in a seemingly spontaneous process and they are rooted in deeper social forces. When it happens, as it inevitably will in Southeast Asians states that continue to develop economically, in the short term there is likely to be less rather than more international security. Given the range of disputes among ASEAN states that are currently barely submerged or barely under control, there might be reason for the region to be thankful that they do not have Greek or Turkish level of democracies. The Greek and Turkish cases may also suggest that Southeast Asian states, when they do democratise, will have security problems ahead.

Similar arguments can be made regarding the growing pluralism in China and the tendency to vitriolic nationalism. China has undoubtedly become a more liberal place in the years of reform, even if the government continues to take a firm line restricting human rights. But the liberalism is the result of economic and social reforms derived from the decision to abandon the socialist ideology. The current hybrid is often described as Market Leninism, but in fact it is more easily recognised as national socialism. The attempt to fill the void at the heart of Chinese values with nationalism is seen to be necessary because the regime requires legitimation from some source apart from economic growth. In this sense China's new and more dangerous nationalism can be seen in part as a response to the uncertainties of naturally emerging pluralism. Democratic support is sought, as in the case of Hitler's Germany or Japan in the 1930s, through an appeal to nationalism. China has had nothing like the elections in Japan or Germany in the 1930s, but the essential point remains the same-China would be a more peaceful participant in international society if it were not having to appeal to its public for legitimacy on the basis of nationalism. Authoritarian China under Mao could decide more easily (as in 1958) to step back from a crisis in the Taiwan Straits, than can the current leadership which cannot afford to be seen to weak on nationalist issues.

The general conclusion seems to be that while pluralist democracy is, in the end, a very positive factor contributing to international security, in the short term the opposite may be true. The challenge for the states of Pacific Asia is rooted in the fact that as they develop economically, they are bound to become more pluralist political systems. While they can eventually look forward to the benefits of "the democratic peace", they still have some dangerous periods to go through. Dangers for democrats come not only from living next door to authoritarians, but also from making the transition through the delicate stage of fragile democracy subject to demagogic tendencies. Thus it is both a source of pessimism, but also eventual optimism for regional security to note that the states of Pacific Asia are growing more democratic.

Interdependence: A Force for Stability?

Perhaps the single most widely held view about international relations in Pacific Asia is that as economic interdependence grows, conflict is made less likely. The logic is alluring: states who obtain the benefits of economic inter-action are less likely to be prepared to fight each other. Sadly, historical evidence suggests this logic is flawed. Economic interdependence (at much higher levels in Europe a century ago, than in Pacific Asia today) did not stop European powers from going to war in 1914. High levels of economic interdependence between the United States and Japan in the 1930s actually contributed to the outbreak of war because the United States controlled vital Japanese fuel supplies.

Economic interdependence is about both the benefits of trade and investment, but also the competition for markets and resources: it carries the seeds of both conflict and co-operation. Economic interdependence only makes peace more likely in the sense that it contributes to the growth of economies, thereby making societies more plural and with any luck, eventually Lite and democratic. Mature democracies do not go to war with each other, but interdependent economies often do. While it is useful to note the extent to which economic interdependence in Pacific Asia is growing, it is even more useful to keep in mind that interdependence is only one step down a much longer road to a democratic peace.

The essential features of economic interdependence in Pacific Asia are not always obvious. It is true that in recent years the percentage of trade done among Pacific Asian states has grown. As a corollary, there has been a relative decline in importance of trans-Pacific exports for most countries (but not China). The spread of that intra-Pacific Asia trade has been uneven. The percentage of ASEAN countries' trade within ASEAN has remained stubbornly in the range of 20-25% for twenty years.

The changes in trade patterns are overwhelmingly market-driven reactions at the corporate level based on the changing economic advantages of different countries. Governments have played a relatively unimportant role and have relatively little control over the processes, at least if they want their country and companies to remain competitive. Japanese firms hollowed out because of rising domestic labour costs. The percentage of Hong Kong and Taiwan exports to the United States fell as both sought cheaper labour costs in China. Not surprisingly, China's trade surplus with the developed world has ballooned. The role of ethnic Chinese networks has been crucial to many of these changes concerning China, for some 85% of foreign direct investment in China is from ethnic Chinese.

It is obvious that the nature of the economic interdependence is primarily the result of rational choices by canny companies. The process is fluid and tells us little about patterns of international security. If China should take a tough line on Hong Kong because of human rights, or continue to carry out military exercises threatening Taiwan, investment and trade will flow elsewhere. In short, economic interdependence provides little protection against the much deeper forces of ethnicity and nationalism that lie at the roots of conflict.

What is more, economic interdependence in Pacific Asia has already exacerbated a range of uncertainties and conflicts. Consider the role of the ethnic Chinese in the region. They are a vital part of the business networks, but their power and prosperity is resented. Anti-Chinese rioting in Indonesia perseveres. Malaysia continues to cage the extent of ethnic Chinese control of the local economy. Even Japanese increasingly worry about the closed nature of Chinese networks and the fear adds to their deeper concern about Chinese power.

Economic interdependence is also a source of concern in that Pacific Asian states need a vast amount of new sources of energy and food as their economies grow. There are a range of worries about the implications for world prices as scarcities are managed. An important part of the tension over the South China Sea is stimulated by worries over long term scarcities of energy and food. Is Indonesia, for example, confident that China does not covet the Natuna gas fields? And even if China will not take the fields by force, is Jakarta confident that China will not bully them into selling at "friendship prices"? Will China insist that its companies win contracts?

Related worries concern the implications of the United Nations Law of the Sea. The treaty was in part designed to manage the growing interest in marine resources and conflicts over ownership. The UNCLOS process has led states to formally declare their sovereign claims, thereby provoking tension with neighbours. Consider the tense dynamic of a Japan worried about Chinese territorial claims; but when Japan enacts domestic legislation under UNCLOS it also triggers relatively dormant conflict with South Korea and China. Law of the Sea issues are also part of the worry over continued defence of the principle of freedom of navigation, an element that clearly loomed large in the robust American naval activity in the Taiwan region in 1996.

It might also be noted that even primarily economic disputes derived from economic interdependence have an important impact on the climate of regional security. For example, while many would agree that close United State-Japan security relations are crucial to regional stability, nasty US-Japan trade disputes put the security framework at risk. US-China trade disputes, for example over intellectual property rights, makes it harder to settle other political and military disputes. China's inability to make intellectual property rights agreements stick has a great deal to do with the impact of decentralisation on its economic and political system. Without economic interdependence between parts of China and the outside world, the local leaders would be less able to resist Beijing's desire to implement international accords. To the extent that these problems of regionalism in China are made possible by international economic interdependence, it can be argued that some of the deeper worries about China's future are the result of economic interdependence. How much was China's vitriolic nationalism over Taiwan in 1996 the result of acute concern about the risks of regionalism at home? In short, seemingly strictly economic aspects of economic interdependence contribute to regional security problems.

Of course despite all these difficulties, it is clearly encouraging that Pacific Asia is moving towards greater economic interdependence. There is a far better chance for a long-lasting pattern of regional security if there is extensive and intensive economic inter-connections. To the extent that the process of bringing the economies closer together is a source of worry, it is a worry born out of an essentially positive process. But the point is there is a need to be concerned about how the process is managed. Economic interdependence is a necessary but far from sufficient condition for regional security.

Managing the process can take many forms. The challenge is derived in part from the fact that many of the elements of economic interdependence are driven by forces at the corporate rather that state level. There are also inherent difficulties in the fact that Pacific Asian economies are of very different sizes and vulnerabilities. There will be a natural worry that Japan and now China will exercise enormous power in the region. Worst of all would be rivalry and tension between the two regional giants. What would clearly help a great deal is an open trading system that does not settle for regionalism but sees virtues in taking an active part in an open and global market economy. Pacific Asian states know they have a long way to go in opening their economies, but they have at least made the right sorts of pledges of good intentions. The challenge will be to get tariff levels down and to genuinely open up their economic systems. The challenge will also be to sustain economic growth in the stages when growth slows and comes to depend more on "inspiration that perspiration". Japan seems to have reached that stage and other states in the region are likely to reach that stage in due course. That will be a time when the security implications of economic interdependence are truly tested. If the societies in Pacific Asia have been transformed into pluralist democracies by the power of the global market economy, then the prospects of a democratic peace will be much enhanced.

Building a Regional Society

Until very recently, it was easy to dismiss the notion that there was anything called a Pacific Asian society. It is still easy to be cynical, but it is only fair to admit that there are now a few glimmers of what might turn out to be a regional society.

Pacific Asia still has no formal structure, and it was not until the Pacific Asian states caucused in preparation for the summit with the European Union in 1996 that the states of Pacific Asia met on their own on a regular basis. Of course, in recent years we have seen the creation of APEC and the ARF, both of which are far wider than Pacific Asia. ASEAN has been around for decades, but it remains less than a third of Pacific Asia. There is an increasing web of official and "track two" meetings on both the wider and sub-regional level, but virtually no sign of regional society for something called Pacific Asia (those states on the Asian rim of the Pacific).

Perhaps it is unfair to expect a regional society to emerge at the level of Pacific Asia, although supporters of the EAEC might beg to differ. Perhaps it is more fair to focus on how individual states and their citizens in Pacific Asia are beginning to articulate an identity that goes beyond their village or state. Can we see signs that Pacific Asians are evolving a sense of sovereignty lying beyond the existing state boundaries?

There are certainly aspects of the individual lives of people in Pacific Asia that recognises real changes in sovereignty. Those countries who are members of the WTO recognise the need to play by rules set by the international community. Some states are willing to put their troops under United Nations command in peacekeeping operations. Most countries have provided information under the UN Conventional Arms Register and other arms control agreements. Even though the Pacific Asian states are mostly new, and therefore still very much enamoured with formal state sovereignty, they have recognised that prosperity requires an important degree of loss of effective sovereignty.

Given this pragmatic attitude to sovereignty when authority is transferred to a global level, it is all the more striking that so little has so far been achieved at the regional level. In the security sphere, the main test has been the ARF process, and so far the cynics have had the best of the argument. The ARF is that most uplifting of optical illusions-an optimistic illusion. Even by the admission of the ARF's main supporters, this is not a grouping of states that is likely to tackle conflict management, let alone conflict resolution, for some time. The ARF will remain concerned for a long while yet with building confidence through a habit of dialogue. The record so far bears out this minimalist agenda.

Consider some stark facts. ARF states concerned about the risks of a regional arms race agree to participate in a UN Conventional Arms Register, but they cannot do so on a regional level. ARF states engage in international peacekeeping, but they cannot manage co-operation on peacekeeping among themselves. A major crisis develops in the Taiwan Straits in 1995-96, but the ARF has nothing to say on the matter. In 1995 when China seized a disputed island claimed by the Philippines, the ARF merely managed to get China to agree to discuss the issue multilaterally and to abide by UNCLOS which it had already signed. The ARF is obviously, at least at this stage, less effective than global processes at achieving arms control and limits on national sovereignties. The ARF cannot constrain local conflicts. What it can do is to help build confidence. That is useful, but far from a sufficient feature of regional security.

To be sure, in recent years there has develo