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Chinese Power at a Crossroads

News & Features | September 28, 2015

The summer of 2015 was a particularly meaningful time for Asia: it marked the 70th anniversary of the end of World War II. In the years leading up to the war and during the conflict itself, the Empire of Japan colonized and invaded most of what we know today as East and Southeast Asia. In the decades following, conflicts and regime change became emblematic of Asian politics in countries such as China, Korea, Cambodia, and Vietnam. Japan, for its part, has set aside its imperialist past, and is seen by many Western countries, including the United States, as a peaceful, democratic ally.

Today, China is undisputedly the regional hegemon in Asia, with a significantly larger economic and military force than its surrounding countries. Continuing expansion into the South China Sea has drawn wide criticism from members of the Association of Southeast Asian Nations (ASEAN) and the US, but China shows no sign of backing down. However, China’s hold on Asia may be slipping. The collapse of the Chinese stock market means Beijing may no longer be able to sustain its meteoric economic rise. The question for Western politicians and policy makers is this: is a rising China in 2015 as dangerous and formidable as a rising Japan was in 1941?

During July and August, I had the chance to live and work in Shanghai and Beijing, where I gained a unique perspective on the emergence of China as a major world power. Before entering China, I traveled to Vietnam, the victim of occupation by both Japanese and French Vichy forces during World War II. The more recent military history of Vietnam includes its decades-long conflict with the US, the Vietnam War, in which the communist North and Western-backed South fought for supremacy. North Vietnam, supported by China, eventually triumphed and absorbed the south. I traveled to the former capital of the south, Ho Chi Minh City (called Saigon by its residents), and the current capital, Hanoi, in the north. June 2015 marked an important date for the Vietnamese: it was the 20th anniversary of the normalization of diplomatic relations between the US and the Socialist Republic of Vietnam, an event commemorated with a visit from President Clinton. It was the former president who initiated talks to reopen channels between the two former enemies. Despite this anniversary, a guide told me the Vietnam War is not the conflict on the mind of most Vietnamese.

“China is the enemy,” my guide claimed in Saigon. “We fought one war with them already, and it seems like they are never satisfied with peace.” He was referring to the 1979 conflict in which Chinese soldiers invaded from the north, almost reaching Hanoi. The Chinese attack, as my guide noted, came as the result of Vietnam’s intent to topple the genocidal Khmer Rouge regime in neighboring Cambodia, an action that garnered the approval of the US and Western powers. The war demonstrated China’s military superiority, though the conflict ended in a stalemate. Referring to this stalemate, a worker at Halong Bay, near Hanoi in northern Vietnam, was less pessimistic about Vietnam’s chances. “If anyone is going to stand up to China, it is going to be Vietnam,” he said, less worried than his southern counterpart about China’s continuing expansion into the South China Sea.

With the significant geopolitical differences between North and South Vietnam—the South is heavily influenced by Western values and benefits from a more open economic policy—it is no surprise that several members of the tourism industry with whom I talked in Saigon were wary of conflict with nearby China. The situation continued to escalate this summer, when the New York Times reported that since the summer of 2014, China has been converting small reefs into fully-fledged islands in an attempt to build and settle on these lands. The territorial waters China are exploring and developing in fact belong to Vietnam, the Philippines, Malaysia, and Taiwan. “It is our waters they are expanding into,” said one restaurateur in Saigon; “They have no right to be in the Eastern Sea,” he said, referring to the Vietnamese name for the South China Sea.

The Guardian reported in July that the Shanghai composite stock index had plummeted and trading was suspended. This reflected the larger collapse of the Chinese stock market. In conversations with my employers, the educators at Global Leader Education Corporation, and Chinese co-workers, the consequences of this economic dip emerged.

“The trouble is,” a 20-year-old college student from Hong Kong said, “the Chinese stock market is not like that in the US.” He went on to explain that, whereas in the US the biggest investors in the market are wealthier individuals who almost always operate through stockbrokers, in China the majority of stock trading is done by middle class families. “We are encouraged to buy or sell this stock or this stock in Xinhua [the Communist Party’s official media] and on TV,” he said. The collapse of the stock market, he remarked, showed that the Party was not omniscient. Another Chinese teacher currently attending university in the US concurred, “If people lose their trust in the government’s ability to run the economy, people will stop trusting the government to do anything.” In all, the people I spoke with, largely students between the ages of 18 and 25, felt that events such as the Shanghai index collapse reflected the possibility that the Chinese economy could be faltering.

From a geopolitical standpoint, this suspension of trading raised serious questions about the viability of China’s until-now meteoric economic progress. After the implementation of economic reforms under Deng Xiaoping started in 1978, China experienced seemingly unstoppable growth. While I was in Shanghai, the trend of seemingly unstoppable growth was called into question.

An even younger group of Chinese students, high school students between 14 and 16, provided additional viewpoints regarding national attitudes about hegemony and regional competition. China’s expansion might be perceived as a dangerous warning sign of budding imperial ambitions by some observers in the region. But none of the students I talked to seemed to think so. After my conversations in Vietnam, I brought up the issue of the South China Sea with the students, citing a number of articles about the building of islands and offshore drilling. One student questioned, “How can it be illegal for China to be expanding in the South China Sea? It is called the South China Sea, so it belongs to China.” The other students in the ten-person class concurred. It was a simple way to express a controversial point: the territorial waters of the South China Sea are in constant dispute, and its name does not do much to help the case of other countries.

Towards the end of this summer, Chinese hegemony, which had taken a serious hit after the fall of the stock market, leaped forward again. August 15 marked the 70th anniversary of Japan’s announcement of formal surrender, marking an Allied victory in the Pacific. For most, despite the continuing apologetic attitude of the Japanese government, the statement on August 15 was too little, too late. Statements are traditionally made by Japanese Prime Ministers every 10 years on the anniversary of surrender, and this one, issued by Prime Minister Shinzo Abe, was criticized heavily in China. AP reported that high-ranking officials from both South Korea and China were dissatisfied, with Beijing criticizing the speech as “evasive.”

China, in many ways, has historically seen itself as a victim of Japanese aggression. It is true that Japan was responsible for significant atrocities during the war, and that millions of Chinese civilians were killed. However, the fact that Chinese commentators dwell on Japan’s aggression 70 years later signals two fundamental problems: first, the government of China during World War II was not the Chinese Communist Party, but rather the Kuomintang Nationalists; second, that Japan today has no military force, and it is China that represents the growing threat for most countries in the region.

For citizens of Cambodia, Vietnam, and the Philippines, countries who suffered at the hands of Japan seventy years ago, China may be looming on the horizon with imperialist tendencies. But all the evidence thus far suggests a different intention: the projection of soft power throughout the region, without actual risk of military engagement. While teachers and students I talked to in China expressed varied opinions, they could all agree on one point; China is no Imperial Japan. Not one person I talked to in China believes that the country is capable of invading and subjugating its neighbors. China, as a rising power, will never stop projecting its influence and reminding its neighbors of its growing influence. But events like the stock market collapse help remind us that China is not invincible.