Fellows Program on Peace, Governance, and Development in East Asia   Author  Gerald Chan is Professor of Politics and International Relations in the University of Auckland, New Zealand. He obtained his Ph.D in Chinese politics and history at Griffith University in Australia and his MA in International Relations at the University of Kent, U.K. Gerald has taught international relations and Asian politics for 15 years at Victoria University of Wellington. He has held visiting or short-term positions at many universities, including the Chinese University of Hong Kong, Cambridge University, the National University of Singapore, Nanyang Technologcal Universty, Singapore, and Kobe-Gakuin University in Japan. He is a Life Member of Clare Hall, Cambridge. He has been an external examiner to the politics programme at the University of Hong Kong. He also holds the position of an external Ph.D examiner in the area of Chinese international relations at the University of Malaya. He sits on the international editorial / advisory board of ten academic journals, including Global Society, Cambridge Review of International Affairs, the Journal of Human Security, and the International Journal of China Studies. Before he joined The University of Auckland in 2009, he was Professor of East Asian Politics and Director of the Centre for Contemporary Chinese Studies at Durham University, UK.   Professor Chan’s key research area is Chinese international relations. He has published a number of books and many articles in this area. He is currently working on several projects relating to China’s ability to create norms and rules that change the behaviour of other states; China’s role in global financial governace; and China’s aid policy.   Two of his co-authored articles won the Best Essay of the Year award: one entitled “Rethinking global governance: a China model in the making?”, in Contemporary Politics (2008); and the other entitled “Japan, the West and the whaling issue”, in Japan Forum (2005).         Abstract   China as a high-speed rail power has just begun to capture the attention of the world. The country now has the biggest high-speed rail network in the world, and it has started to export its rail products overseas. Yet there is little in-depth study of this curious phenomenon in the academic literature. This paper tries to fill this void. China’s global high-speed rail development is part and parcel of the country’s infrastructure diplomacy which, in turn, is a core part of its initiative to develop the New Silk Roads on land and at sea. The paper argues that the impact of such a mammoth enterprise on global development would be huge, in terms of geopolitics, geoeconomics, and social relations. It assesses Asian responses to this new diplomacy, especially those of Japan, South Korea, and Taiwan. Keywords: China, East Asia, high-speed rail, infrastructure development, ‘one belt, one road’     Introduction   *This paper is a working paper (draft as of 31 January 2016). Comments and criticisms are most welcomed.   The central thesis of this paper argues that the development of China’s high-speed rail diplomacy (高铁外交) and the way in which China helps to finance this and other infrastructure projects will lead to the making of a ‘new’ world order. This thesis is new in several respects. First, China’s rise to become a high-speed rail power has occurred just in the last decade or so; the speed of development has been phenomenal. The country started to develop its high-speed rail system in 2004 by buying trains and rail technology from foreign companies such as Japan’s Kawasaki, Germany’s Siemens, France’s Alstom, and Canada’s Bombardier. Based on foreign technology and its experience in the train industry in the past, China began in 2007 to develop its own technology. On 1 August 2008 China’s first high-speed rail started to run between Beijing and Tianjin, a week before the official opening of the Beijing Olympic Games. In 2009 China decided to ‘go out’ to spread its high-speed rail investment, thus beginning a process of industrial transition from ‘made in China’ as a goods manufacturer to ‘created in China’ as a technology innovator and promotor. Three major lines are in plan to connect Asia and Europe, Central Asia, and Indo-China.   Second, China’s high-speed rail diplomacy has become the core of its infrastructure diplomacy which, in turn, has formed the core of China’s foreign policy, all happening within the last few years. Chinese Premier Li Keqiang has acquired the nickname of ‘China’s high-speed rail salesman’ as a result of his energetic promotion while on his many official visits around the world.   Third, to finance infrastructure projects under the New Silk Road initiative, China has taken the lead to set up the New (BRICS) Development Bank (in 2013), the Asian Infrastructure Investment Bank (2014), the Silk Road Fund (2015), and other funding mechanisms, both multilateral and bilateral. (See Appendix 1 for a chronology of the development of the ‘one belt, one road’ initiative). The initiative was proposed by Chinese President Xi Jinping in late 2013. It is known officially in full as the ‘Silk Road Economic Belt’ and the ‘21st Century Maritime Silk Road’ or in short the ‘one belt, one road’ or in Chinese yidai yilu (一带一路).   Fourth, according to the 21st Century Business Herald, a well-respected business newspaper in China, the global investment market in the time period 2014-2030 for high-speed rail industry is estimated to amount to 17,414 billion yuan, and China is going to take up the lion’s share of this market (see Table 1). At present, China is negotiating high-speed rail construction with some twenty to thirty countries. In 2014 China received orders for its train industry worth over US$100 billion.   Table 1. China’s share of the global market of high-speed rail industry, 2014-2030 (estimates)   Source: 21st Century Business Herald, 27 January 2015, p. 14. Note: US$1 = 6.58 yuan (approx., as of 31 January 2016)     Theoretical Challenges   China’s ‘belt and road’ initiative has sowed the seeds for an emerging global order, one that is likely to challenge our understanding of international relations in four related areas: international development, international finance, international organisations, and ultimately peace and governance. In terms of international development, China, alone or with other emerging economies like those in the BRICS group (Brazil, Russia, India, China, and South Africa), have forged a South-South cooperation programme that supplements the traditional type of aid extended by developed countries. This kind of South-South cooperation, in contrast to the traditional model, is based on mutual benefits among the parties involved, with infrastructure development as a main driver of economic growth. It does not set the kind of ‘good governance’ conditions, as do the World Bank and the IMF, which require aid-receiving countries to make major political and economic changes to their governance system. In this way, South-South cooperation can be seen to be competing with OECD countries for the hearts and minds of the people in the Global South.   Figure 1. A model of China’s multilateral financial engagements      Direction of China’s desired flow of its influence   * These are new institutions initiated by China since 2013: AIIB: Asian Infrastructure Investment Bank CMIM: Chiang Mai Initiative Multilateralisation CRA: Contingency Reserve Arrangement SCO (Shanghai Cooperation Organisation) Development Bank   Source: Author Note: G20 holds 65.8% of the quotas of the IMF and 64.7% of its votes   In terms of international finance, China has played a leading role in launching the New Development Bank (or the BRICS bank, with an authorised capital of US$50 billion rising to $100 billion) with an affiliated Contingency Reserve Arrangement ($100 billion), the Asian Infrastructure Investment Bank ($100 billion), the Silk Road Fund ($40 billion), and Shanghai Cooperation Organisation Development Bank (under construction), the Chiang Mai Initiative Multilateralisation ($240 billion). China has also set up other funding mechanisms, multilateral, bilateral, or commercial, as well as making contributions through its state-owned banks. (See Figure 1). These financial institutions supplement as well as challenge the work undertaken by the Bretton-Woods institutions, consisting of the World Bank, the International Monetary Fund, and the World Trade Organisation, and by extension, the Asian Development Bank, the European Bank for Development and Reconstruction, and others.   In terms of international organisations, apart from the financial institutions mentioned above, China has played a major role in setting up the Shanghai Cooperation Organisation, the Bo’ao Forum (China’s answer to the World Economic Forum or the Davos Forum), the Conference on Interaction and Confidence Building Measures in Asia, the Xiangshan Forum (China’s answer to the Shangri-La Dialogue), and others. These organisations play a tune quite different from the traditional organisations set up and controlled by the West in managing global politics, finance and development. Also, there is an increasing number of Chinese nationals taking up senior executive and management positions in international organisations, although the number is relatively small and the increase very slow...(Continued)         ※ This paper is a working paper (draft as of 31 January 2016). Comments and criticisms are most welcomed.

Fellows Program on Peace, Governance, and Development in East Asia     AbstractWhy are some governments adaptable but not others? Why has China’s government, in par-ticular, displayed remarkable flexibility and adaptive capacity? While many observers acknowledge that China’s bureaucracy is adaptive, few have tried to explain the sources of its unusual adaptability. To adapt means to select strategies or to make changes that improves performance according to some measure of success. Central to adaptive capacity, hence, is the definition of success itself. Effective adaptation requires a clear definition of and attractive rewards for achieving success. The main instrument for defining success in China’s bureaucracy is the system of cadre evaluation targets. I document the evolution of evaluation targets over time, highlighting the problem of mission creep and the challenges that such a change poses to China’s governance..       Quotes from the Paper“China’s bureaucracy, on the other hand, is widely described by China experts as “entrepreneurial,” “developmental,” “nimble,” and “adaptive.” China’s national government makes ample use of policy experiments, encourages and incorporates social feedback into policy-making, coopts private entrepreneurs and new influential groups, studies and learns from the experiences of other coun-tries, while local officials pursue creative—even if problematic—ways of fostering growth and generating revenue.”     “My research aims precisely to fill this theoretical gap. I do so by drawing on an established interdisciplinary field that has yet been introduced to China studies and political science more broadly: complex adaptive systems (also known as “complexity” for short)”   “In China’s bureaucracy, the key instrument for defining success is the system of “cadre evaluation targets.” This institution comprises a list of targets assigned by higher-level governments to lower-level governments, according to which local officials throughout the country are scored and ranked annually.”   “.....by studying the evolution of cadre evaluation targets, we gain concrete insights into the ability of China’s central authorities to effectively signal policy priorities and guide local bureaucratic behavior...... But again, if we look concretely at the targets assigned, it will be clear that adding more targets to an already exhaustive list of mandates is unlikely to modify bureaucratic incentives. These institutional changes in turn have deep economic consequences because China’s economy remains heavily dependent on local state actions. Whether and how central authorities may continue to guide local bureaucratic behavior through targets is one of the toughest political challenges in years to come.”           AuthorDr. Yuen Yuen Ang is an Associate Professor at the Department of Political Science, University of Michigan. She studies development, complexity, and Chinese political economy. Her research seeks to deepen our understanding of development as a complex process, by developing new theories and tools that capture its dynamic, non-linear, and multi-dimensional reality. Focusing on developing countries and emerging markets, particularly China, she explores three interconnected themes: (1) how markets emerge in the absence of good governance and state capacity, (2) the underlying conditions that enable effective adaptation within governments, and (3) the interactive relationship between corruption and economic prosperity. She is the author of How China Escaped the Poverty Trap (Cornell University Press, Cornell Studies in Political Economy, 2016). The book examines all three themes within a unified framework and lays the foundation for her research agenda. It won the 2017 Peter Katzenstein Book Prize for “outstanding first book in international relations, comparative politics, or political economy.” It has been reviewed at the World Bank, Straits Times, Foreign Affairs, Harvard’s Building State Capability Blog, and other outlets.      

.a_wrap {font-size:14px; font-family:Nanum Gothic, Sans-serif, Arial; line-height:20px;} Editor's Note In this paper, Sangbae Kim analyzes a new trend in the competition between the US and China in cyberspace by using a framework comprising three-dimensional competition of technology, standards, and charm. Kim's paper is based on the notion that cyberspace is an emerging sphere for US-China power competition as China rises as a global leader in the digital realm with remarkable growth in science and technology. In this new arena, a power game is underway to secure capabilities and resources in technology and data, dominate standards in related sectors, and establish universal norms.     Quotes from the paper   Introduction In exploring the current US-China competition, this paper highlights the new issues of information technology—in a broader sense, knowledge, culture, and communication. These issues are recognized as the new sources of power in the information age, or so-called Fourth Industrial Revolution, and are now opening a new horizon of world politics beyond the traditional power politics based on military and economic resources (Schwab 2016). More specifically, these issues belong to a leading sector which is both growing faster than any other part of the world economy and driving the growth of other sectors. This new sector has enjoyed recent rapid expansion through the medium of cyberspace. Cyberspace has been understood intrinsically as the space of technologies and industries, but has been recently transformed into a complex space that includes online and offline activities with socio-political implications. Understanding this, this paper pays attention to US-China competition in cyberspace as an emerging leading sector. This paper comprises two main parts. In the first part, adopting network theories, it outlines a theoretical framework for platform competition and emerging power politics between two great powers, and interprets the competition as “inter-network politics” between two network states—the United States and China. In the second part, applying the framework of three-dimensional platform competition, this paper analyzes U.S-China competition in cyberspace in coping with the “inter-network politics” of cyberspace. This paper concludes with a brief summary of the main argument, and presents further research concerns.   US-China Technological Competition in Cyberspace The key issue in emerging power politics is the technological competition between the United States and China in the wave of the Fourth Industrial Revolution. The success or failure of each country in the sectors of semiconductors, smartphones, supercomputers, artificial intelligence, cloud computing, the Internet of Things (IoT), big data, e-commerce and FinTech will determine the future of global hegemony. In these sectors, product productivity and technology innovation are the keys to competition at the first threshold. Technological innovation in such sectors as network equipment, servers, and sensors, which are composed of infrastructure environments interconnecting individual devices, are also critical to this competition. In addition to wired and wireless internet, recent innovations in technologies related to IoT are drawing attention. In this regard, the future of the United States and China might be dominated by the CEOs of the digital economy and industry rather than by political leaders.   US-China Standard Competition in Cyberspace Recent competition in IT has been different from past competition to produce cheap and high-quality semiconductors, high performance software and computers, and fast, accessible Internet. In other words, it goes beyond competition in which a company or country acquires resources and builds manufacturing capability and innovations. Of course, there is no denying the importance of having enough capital and advanced technology in winning this competition. However, as the environment of complex networks and media converge in cyberspace competition, it is very important to dominate standards in related sectors. From this point of view, standard competition is “platform competition” to create a new stage and play a new game, rather than a game to win on the established stage. Recently, based on the enormous power of Chinese consumers, Chinese companies have been challenging US companies in this field of platform competition.   US-China Charm Competition in Cyberspace In the most comprehensive sense, US-China competition in cyberspace is a competition of charm, which could also be called a competition over “soft power” (Nye 2004). This charm competition goes beyond taking control of markets and policies to establish persuasive and agreed-upon universal norms. For example, unlike hardware-based manufacturing sectors, the success or failure of the cultural industry and Internet businesses depends on who can produce more emotionally compelling content and desirable services. Producing attractive content and services is only half the battle- diffusion and communication are also important. The extent to which the policies, institutions and culture of a certain country are able to embrace the content and services provided also plays a critical role. In this regard, the charm competition means establishing norms that include universal values and an accessible world view. As in the case of technical standards and institutional models, the United States has thus far dominated the realm of charm diffusion and norm setting, and China’s challenge in the future will be reaching this domain.   Conclusion Indeed, the recent competition between the United States and China in cyberspace has developed into a multi-dimensional competition over industry, trade, security, military, privacy, law and institutions, and international norms. Faced with such complexity generated by the rise of the emerging power game, South Korea must take systematic measures to implement necessary policies and rearrange existing institutions. South Korea must also seek out strategic roles in the US-China competition. In searching for such strategic roles, as this paper recommends, South Korea should consider its structural position and take actions for security and prosperity as a middle power. Indeed, this situation is likely to provide South Korea with a golden opportunity to engage in middle power diplomacy, especially in cyberspace. However, we also have to keep in mind that the structural conditions produced by US-China competition may pose a threatening challenge to South Korea, whose geopolitical fate is to be located between two super powers.     Author's Biography Sangbae Kim is a professor in the Department of Political Science and International Relations at Seoul National University. His major research interests are in the areas of information, communication, and networks in international relations. His publications include Virtual Spears and Network Shields: World Politics of Cyber Security and South Korea (Hanulmplus 2018, in Korean), International Relations of Arachne: Challenge of the Network Theory of World Politics (Hanul Academy 2014, in Korean), and Information Revolution and Power Transformation: A Perspective of Network Politics (Hanul Academy, 2010, in Korean). Kim has a Ph.D. in political science from Indiana University, Bloomington.    

.a_wrap {font-size:14px; font-family:Nanum Gothic, Sans-serif, Arial; line-height:20px;} Editor's Note In an effort to understand China's national and regional security strategy, Dong Ryul Lee reviews trends in China's military buildup with a focus on defense spending and strategy in response to economic growth. The paper shows that China's defense spending has consistently increased in line with its economic growth and fiscal spending, and that the country has sufficient economic and financial capacity to increase military spending if necessary. However, domestic factors, such as the growing domestic demand for social welfare and population changes, may act as a constraint on this spending in the future.     Quotes from the paper   China's Military Spending The growth in Chinese military spending is tied to its rising GDP. China’s estimated defense budget was $50 billion (USD) in 2001 and $228 billion (USD) in 2017 (2016 base year USD). Although this number represents over a 356 percent increase, these figures run generally parallel with Chinese economic growth. Over the same period, the Chinese economy grew by approximately 950 percent, resulting in a rate of Chinese military expenditure as a percentage of GDP that remained steady at around 2 percent as shown in figure 2.   Figure 2 Military Spending as Percent of GDP         Source: CSIS China Power Project (Data from: SIPIRI Milex Database)   China’s defense spending has certainly increased in absolute terms, but in the long term, the growth rate is tending towards decline. From 1990 to 2013, the average annual defense budget growth rate for the 24-year period was 15.1 percent. Throughout Xi Jinping’s administration (2013-2016), the average growth rate declined to 10.15 percent. In fact, China's defense spending has been rising sharply in recent years, but it still appears to be managed within acceptable limits of the country’s economic capacity.   Variables in Forecasting China's Defense Spending In general, defense spending is mainly affected by three variables: policy wills, capacity, and the presence of  external threats. Therefore, predictions of Chinese defense spending consider the following variables which have the potential to affect China’s future defense spending. First, in terms of policy will, there is the question of how highly the Xi Jinping administration will prioritize “building a strong military (强軍夢)” in order to realize the so-called Chinese dream (中國夢). Second, in terms of capacity, it is necessary to examine the economic and social variables of China that will affect the country’s future defense budget, because the Chinese government has increased its military spending in line with the economic growth rate thus far. Finally, as China has quickly emerged as a powerful country since it launched its reform and opening, it has significantly weakened its perception of direct military threats from outside. Therefore, the manner in which the Xi Jinping administration will recognize and respond to any checks posed by the US against China will become an important factor in determining defense spending.   Policy Will and Military Strategy Building a strong national defense and powerful armed forces is a strategic task of China’s modernization drive and a security guarantee for China’s peaceful development. The building of a strong military pursued by the Xi Jinping administration encompasses modernizing the military and focusing on the qualitative growth of military power. The key to China’s military buildup is its ability to acquire advanced defense technology. As long as China continues to actively pursue its military modernization, especially if it pursues the development of civil-military integration, the actual defense spending that the government does not include in its official figures will continue to grow in the future.   Capacity: GDP Growth Rate China's defense spending has consistently increased within a certain range of China’s economic growth and fiscal spending. In other words, the Chinese government has stably maintained and controlled the defense budget. Should a situation that demands an increase in actual military strength arise, the country has sufficient economic and financial capacity to mobilize greater defense spending than the current level, depending on the will of policy makers. However, as social diversity expands due to income growth, there is the potential for increased challenges to the legitimacy and stability of the Communist Party system. Even if China can sustain a medium level of growth, it will face financial limits on the development of its military power if it is to meet the growing needs and expectations of its people. Military spending may be constrained by a growing demand for domestic welfare, an aging population, and a decrease in the working population.   Threat: The United States Variable China is trying to avoid entering into geopolitical conflicts with the US, and gradually seeks a path to a geoeconomic rise (Lee 2017, 329-364). Currently, China seeks to focus on economic development, such as the “Belt and Road Initiative (BRI),” while avoiding direct military conflicts with the United States to the greatest extent possible. China is not currently capable of directly challenging the US militarily, so the situation is likely to be one of long-term competition, not war. As China continues its unexpectedly rapid rise and the United States further implements Indo-Pacific strategy in Asia, many countries in the Asia-Pacific region will face a harsh dilemma between US and China. The United States will push strongly to contain China’s expansion in the South China Sea, the East China Sea, and the Korean Peninsula, where China’s influence can prevail. Competition for influence between the US and China will gradually increase in the region. If the Trump government pressures China on territorial and sovereignty issues that the Xi Jinping government sees as its “core interests,” such as Taiwan or South China Sea, then the Xi government may encounter difficulties in that its active use of nationalism to secure the legitimacy of the communist regime leave it too rigid to address the issue adequately.     Author's Biography Dong Ryul Lee is a professor in the Department of Chinese Studies at Dongduk Women’s University since 1997. He is now President of The Korean Association for Contemporary Chinese Studies and serves as a policy advisor to the Republic of Korea Ministry of Foreign Affairs. His research area includes Chinese foreign policy, international relations in East Asia, Chinese nationalism and minority. He was a visiting scholar at the Weatherhead East Asian Institute at Columbia University from 2005 to 2006. He received his Ph.D. in international politics from Peking University.    

.a_wrap {font-size:14px; font-family:Nanum Gothic, Sans-serif, Arial; line-height:20px;} Editor's Note In this paper, Seong-ho Sheen assesses China’s overall military power by analyzing its current military posture and reform endeavors in terms of conventional military capability, strategic nuclear capability, and power projection capability. Based on this analysis, he develops a scenario of China’s three-stage future defense reform in line with its economic growth. China’s military power, according to him, is still far below that of the US in all aspects but China’s ongoing efforts to bolster its military strength may eventually lead to a competition with the US as it will pursue increased influence and prestige based on its growing military and economic power.     Quotes from the paper  Introduction In assessing China’s military power trajectory, this paper will focus on three areas; conventional military capability, strategic nuclear capability, and power projection capability. Traditional Chinese military strategy has been based on the concept of mainland defense and preparation for a Taiwan contingency. This strategy has been based on a defensive use of military force. Throughout the Cold War and up until the 2000s, China’s military planning has been built upon large ground forces to defend its mainland from enemy invasion and missile forces to launch an attack on independent Taiwan and foreign interventionists, most possibly the US military in the region. As of 2015, official Chinese military strategy stated “China will unswervingly follow the path of peaceful development, pursue an independent foreign policy of peace and a national defense policy that is defensive in nature, oppose hegemonism and power politics in all forms, and will never seek hegemony or expansion” (China’s Military Strategy 2015). Yet at the same time, Chinese officials increasingly feel the pressure of neighboring countries working to contain China’s growing power and influence in the region, especially the efforts led by the United States in the 21st century. There have been growing Chinese efforts to push back against American encirclement and secure China’s sphere of influence. This strategy has evolved into what is known as Anti-Access Area Denial (A2/AD). China’s A2/AD uses “a series of interrelated missile, sensor, guidance, and other technologies designed to deny freedom of movement” to keep any potential adversaries, including the United States, from intervening in a conflict off of China’s coast or from attacking the Chinese mainland (Biddle and Oelrich 2016). Some see the new Chinese strategy as more aggressive in nature and posing a grave threat to US power projection capabilities in the region. Still, from the Chinese perspective, A2/AD is an effort to defend its core interests close to its mainland, and are not an attempt to engage in any kind of expansionist ventures in and beyond its regional boundaries.   US vs Chinese Nuclear Force China’s strategic nuclear capability appears even weaker compared to that of the US when you look at the composition, quality, technology, and operational capability of its nuclear forces. As shown in the table below, China does not have a nuclear triad, and its nuclear deterrence mostly depends on a small arsenal of outdated ICBMs against the powerful US triad system of land-based ICBMs, strategic nuclear submarines, and nuclear bombers.                 Table 1. US-China Nuclear Forces                Source: Sheen (2017, 16)   China's Power Projection Capability China does not have meaningful power projection capability due to the focus of its military goals on mainland defense. China has just finished refurbishing a Cold War era Soviet aircraft carrier and is in the process of building its first indigenous aircraft carrier, while the United States has ten active carrier strike groups. In 2017, the PLAN’s first aircraft carrier, the Liaoning, concluded its second training deployment to the South China Sea, its first with an embarked J-15 fighter aircraft, and conducted its first port visit to Hong Kong. China’s first domestic aircraft carrier was launched in 2017 and will likely join the fleet by 2019. The new carrier is a modified version of the Liaoning, but is similarly limited in its capabilities due to its lack of a catapult and the smaller size of its flight deck compared to US carriers. China is expected to begin construction on its first catapult-capable carrier in 2018, which will enable additional fighter aircraft, fixed-wing early-warning aircraft, and more rapid flight operations. However, China’s new aircraft carriers are substantially less capable than US Navy carriers. It will take long time and a significant degree of investment before China can match US forces in any meaningful way (US Department of Defense 2018).   China's Defense Reform and Future Military Power  Based on the discussion of China’s current military posture and its reform efforts in terms of its conventional military capability, strategic nuclear capability, and power projection capability, this paper projects the following developments in China’s military power in sync with its GDP per capita growth. First, China will try to finish its first stage of military modernization with the current organizational restructuring focusing on the centralization of command and control, enhanced joint military operation capability with the elevation of navy and air force combat readiness, and a downsize of the army together with the creation of independent nuclear strategic forces. This will be pursued through 2025, when China is projected to achieve the level of 15k GDP per capita. For the second phase of military reform by 2035, China will try to achieve meaningful strategic nuclear deterrence capability against the United States with a focus on enhancing the survivability of its ICBMs with mobile and MIRV capability. It will also try to build its operational SLBMs capability within the first defensive layer in the East Pacific. It may also try to build strategic bomber capability to have a basic level of triad capability. This will be in line with the country’s achievement of a 20k GDP per capita. For the final phase of military reform by 2049, China will try to achieve a world class military power on par with that of the United States. This will include state-of-the-art military technology in terms of conventional military capability, a powerful strategic nuclear capability with a full triad, and a global power projection capability. Within this period, China is projected to achieve economic development to the level of 30k GDP per capita.     Author’s Biography Seong-ho Sheen is Professor of International Security and Director of Institute of International Affairs (IIA) at Graduate School of International Studies (GSIS), Seoul National University. He was a visiting fellow at the East-West Center DC, a CNAPS fellow at the Brookings Institution, an assistant research professor at Asia-Pacific Center for Security Studies (APCSS), Honolulu, Hawaii and a research fellow at Institute for Foreign Policy Analysis (IFPA), Cambridge, Mass, the U.S. He has taught at University of Massachusetts Boston. In addition, he advised various government organizations including ROK National Assembly. His area of interest includes International Security, US Foreign Policy, Northeast Asian Politics and the Korean Peninsula. Sheen received a Ph.D. and M.A. from the Fletcher School of Law and Diplomacy, Tufts University and B.A. from Seoul National University.    

.a_wrap {font-size:14px; font-family:Nanum Gothic, Sans-serif, Arial; line-height:20px;} li {margin:8px 0;} Editor's Note In this paper, Tai Ming Cheung examines the vision and paths put forward by China under Xi Jinping to build a militarily powerful and technologically advanced country, which is also called a "techno-security state." Xi’s military reinforcement strategy is composed of the three following components―reform, modernization, and innovation; Xi has put particular emphasis on innovation and expanded its application to military arena far more compared to his predecessors. Cheung expects the Chinese techno-security state to make smooth progress under Xi’s leadership based on sufficient financial capacity and good access to foreign technology, despite hurdles such as bureaucratic fragmentation, corruption, and political interference.     Quotes from the paper  Introduction At the 19th Chinese Communist Party Congress in October 2017 that solidified Chinese Communist Party General Secretary and Commander-in Chief Xi Jinping’s hold on power for the foreseeable future, he offered a confident, even strident, vision of China’s growing long-term influence and might in the international system. Xi talked about “socialism with Chinese characteristics entering a new era” in which he described China as “moving closer to the global center stage,” that China’s brand of socialism offered a new option for countries who want to speed up their development while preserving their independence, and a China that was becoming a great power (Xi 2017). To realize these grand ambitions, Xi stressed that China needs to become a militarily powerful and technologically advanced country, and he offered a timeline. First, the country should reach the first tier of the world’s most innovative countries by 2035, and at the same time, the military would realize its objectives of becoming a fully modern force. By 2050, China would challenge for global leadership with a world-class military a centerpiece of the country’s “comprehensive national strength.” This paper examines whether these goals are realistic and achievable within the timeline put forward by Xi? How will China undertake this grand transformation? What is Xi’s vision for marrying military power with innovation? What are the geostrategic and geo-economic implications for the United States and Asia if China is successful?   The Emergence of the Chinese Techno-Security State under Xi Jinping China under Xi Jinping is a security-maximizing state that is building its power and prestige on an increasingly capable and expansive economic and technological foundation. The country fits the profile of what can be defined as a techno-security state in which the development efforts of the state are prioritized to meeting expansive national security requirements, of which the cultivation of strategic technological and industrial capabilities are prime goals. […] Xi’s vision of the Chinese techno-security state is heavily influenced by the ideological and organizational principles laid down during the Maoist era in the 1950s to 1970s and updated by his predecessors Jiang Zemin and Hu Jintao in the 1990s and 2000s. These principles are emphatically statist in nature: Technological development is strategic and fundamental for determining China’s place in the global strategic and economic balance –it is a vital ingredient in grand strategic thinking. The state must invest in critical technological sectors because of high risks and long and costly research and development cycles. The state must nurture indigenous innovation capacity, although this should allow for absorption of foreign technologies to help catch up. Technology diffusion through spin-off or spin-on should be a central long-term goal Military and security considerations should be paramount. Emphasis should be on ‘big science’ mega-projects. The grand strategy of Xi’s techno-security state has several core components: Building a strong national security state, especially prioritizing the development of military, internal security, and information control capabilities across a wide array of domains, of which cyber is of central importance. Building an advanced defense science, technological and industrial base. Forging a dual-use civil-military economy.   The Rise of the Chinese National Security State under Xi  In the making of the national security state, Xi has put forward a concept that he describes as a ‘national security path with Chinese characteristics’ that is a mixture of assertive principles coupled with deep concerns of vulnerabilities (Xinhua News Agency April 16, 2014). A number of key notions are behind the shaping of this concept: National security is comprehensive: Xi sees the domestic and external components of national security as overlapping and tightly connected, which is very different from the compartmentalized approach that his predecessors pursued. This is an important reason why Xi decided to establish a new organization, the National Security Commission, to manage this integrated approach (Lampton 2016; Wuthnow 2017). National security is expansive: Closely connected with the perspective that national security is comprehensive is the notion that it is expansive and covers many different domains. In a new national security law that is being finalized, national security is identified as covering 11 categories: political, territorial, military, economic, cultural, social, ecological, science and technology, information, nuclear, and natural resources. Ensuring national security has to be done pro-actively, pre-emptively, and strategically: It is important to identify and address national security challenges and opportunities early, strategically, and decisively rather than being reactive and tactical. This requires extensive and high-level leadership engagement, close coordination across the national security apparatus, and the development of a capable and substantial intelligence system to keep abreast of internal and international developments. Strongly asserting China’s interests: Xi is stressing the need to engage in struggle (斗争) in the pursuit of national interests, especially in the military and diplomatic arenas. In describing China’s approach in dealing with the United States, Admiral Sun pointed out that “facts have shown that without struggle it will be impossible for the United States to respect our core interests, without struggle it will be impossible to realize cooperation and win-win on the basis of equality, and without struggle it will be impossible to have an excellent situation today.” In other words, China needs to take a resilient stance and push hard against the United States in order to win its respect, although the Chinese leadership is also careful not to go too far and spark armed conflict, as it remains much weaker.   The Cult of Innovation and the Transformation of Chinese Military Power Xi Jinping’s grand goal of transforming the Chinese defense establishment from being big to being strong rests on a three-pronged strategy of reform, innovation, and modernization. Reform refers to undertaking a concerted roots and branch restructuring of the existing defense establishment to improve its readiness and ability to fight and win future wars as well as to ensure its political reliability to the Communist Party. Innovation concerns the development of new, especially novel, ways and means of strengthening China’s military power and influence through hard (such as material, technological, and industrial) and soft (such as normative, strategy and tactics, processes) factors. Modernization is the result of the implementation of the reforms and innovation on the development of defense capabilities. While these three components of Xi’s military strengthening strategy are being pursued on parallel but separate tracks, there is considerable overlapping and coordination of their activities. Moreover, although these endeavors are occurring concurrently, there are different timeframes set for them. Accomplishing the bulk of structural reforms is targeted for the beginning of the 2020s, while Xi declared at the 19th Party Congress that defense modernization would basically be completed by 2035 and China would become a world class defense innovation power on a par with the United States by 2050. Reform and modernization have been at the top of the defense establishment’s policy agenda going back to the 1970s, but innovation has only come to the fore since the beginning of the twenty-first century. Both Jiang Zemin and Hu Jintao emphasized the importance of innovation, especially related to research and development, during their tenures. Xi though has elevated innovation to a core priority and broadened its application to far more military areas than his predecessors did.   Global Implications: Intensifying U.S.-China Technological Competition The Chinese techno-security state is flourishing and looks set to grow faster, bigger, and better under Xi Jinping’s long-term leadership. While weaknesses such as bureaucratic fragmentation, corruption, political interference, and entrenched corporate interests will complicate progress, there are numerous strengths that will allow the techno-security state to mitigate or overcome these obstacles. They include ample funding and good access to foreign technology and know-how. The rise of the Chinese techno-security state has triggered deepening concern in the United States that its military technological superiority with China is under mounting threat. This has led to intensifying Sino-US defense technological competition that is likely to become more acute. The U.S. Defense Department has been pursuing a number of initiatives since the early 2010s in an effort to maintain its technological advantages, such as the Third Offset Strategy and the Defense Innovation Initiative that was pursued by the Obama Administration (see Cheung and Mahnken 2018). While the Trump Administration no longer uses the Third Offset label, it has made clear that it embraces the view that the United States and China are now great power rivals. This is spelled out in the US national defense strategy issued in January 2018 that points out, “as China continues its economic and military ascendance, asserting power through an all-of-nation long-term strategy, it will continue to pursue a military modernization program that seeks Indo-Pacific regional hegemony in the near-term and displacement of the United States to achieve global pre-eminence in the future” (U.S. Defense Department 2018). This competition in the defense domain has also spilled over into the broader U.S.-China technology relationship, especially in areas such as high and strategic technology, communications technology, U.S. and allied curbs on Chinese investment in sensitive technological areas, and restrictions on research and development exchanges. The two countries appear to be spiraling into a technological cold war that has far-reaching negative consequences for not only their techno-security establishments but also for the development of their national innovation capabilities and for the global technological order.       Author’s Biography Tai Ming Cheung is the director of IGCC and a professor at the School of Global Policy and Strategy at UC San Diego, where he teaches courses on Asian security and Chinese security and technology. He is a long-time analyst of Chinese and East Asian defense and national security affairs and was based in Asia from the mid-1980s to 2002 covering political, economic, and strategic developments in greater China. He was also a journalist and political and business risk consultant in Northeast Asia. Cheung received his Ph.D. from the War Studies Department at King’s College, London University. Recent publications include The Gathering Pacific Storm: Emerging US-China Strategic Competition in Defense Technological and Industrial Development (ed., with Thomas Mahnken, Cambria, 2018) and China and Cybersecurity (ed., with Jon Lindsay and Derek Reveron, Oxford, 2015).  

<style type="text/css">.a_wrap {font-size:14px; font-family:Nanum Gothic, Sans-serif, Arial; line-height:20px;} </style> <div class="a_wrap"> <p font-size:="" nanum="" style="font-family: " text-align:=""><span style="font-size: 16px;"><strong><span style="color: rgb(218, 165, 32);"><u>Editor&#39;s Note</u></span></strong></span></p> <p font-size:="" nanum="" style="text-align: justify;" text-align:="">US economic policy toward China has centered on the integration of the country into the US-led global rule-based system since its opening up in 1978. However, this approach has been shaken since the Trump administration abandoned many of the pillars of liberal institutionalism. The clash between such shifts and China&rsquo;s increasingly statist developmental approach under Xi jinping has led to tensions between the US and China. In the lead paper in this collection, Stephan Haggard and Barry Naughton examine policy changes of the two countries and the implications as well as the resulting conflicts which have risen. The authors also offer a careful analysis and map out three possible scenarios of the prospects for US-China relations in the short- and intermedium term.</p> <p font-size:="" nanum="" style="font-family: " text-align:="">&nbsp;</p> <hr font-size:="" nanum="" style="font-family: " /> <p>&nbsp;</p> <p style="text-align: justify;"><span style="font-size:16px;"><strong><span style="color:#000080;">Quotes from the paper</span>&nbsp;</strong></span></p> <p style="text-align: justify;"><span style="color:#0000CD;"><strong>Introduction</strong></span></p> <p style="text-align: justify;">Since the opening to China in the 1970s, US foreign economic policy toward the country was an integral part of the US&rsquo;s broader defense of a liberal, rule-based global economic system. The core to this strategy was the integration of China through the negotiation of binding rules, with China&rsquo;s entry into the WTO as the crowning moment of the approach. Despite disagreements at the margin, this strategy not only united the US&rsquo;s two political parties; it also enjoyed support among US allies.</p> <p style="text-align: justify;">Since 2016, however, this approach has virtually collapsed under the weight of developments on both sides of the Pacific. In the US, the Trump administration unambiguously rejected basic premises of the liberal institutionalist approach. In China under the leadership of Xi Jinping, there has been a return to a more statist, developmentalist posture toward economic policy, with new industrial policies, greater emphasis on state-owned enterprises, and a strengthened Communist Party role.</p> <p style="text-align: justify;">This paper begins with a brief consideration of possible growth trends going forward and their implications. We will then examine the US-China conflict in more detail and consider a number of possible scenarios for both the short- and intermediate run.</p> <p style="text-align: justify;">&nbsp;</p> <p style="text-align: justify;"><span style="color:#0000CD;"><strong>China&rsquo;s Growth History: Policy and Prospects</strong></span></p> <p style="text-align: justify;">Since the onset of &ldquo;reform and opening&rdquo; in 1978, China has undergone dramatic economic and political changes, but with a noticeable policy turning point in 2006-2007. China&rsquo;s export ratio (exports/GDP) increased steadily up this point, with an especially rapid increase in 2002-2005 following its entry into the WTO. Since 2006-2007, China&rsquo;s export ratio has declined just as inexorably, although it may now (2019) be stabilizing.</p> <p style="text-align: justify;">This shift in the role of trade was related to broader changes in China&rsquo;s development trajectory, which were in turn related to the country&rsquo;s secular slowdown. From 1978 through 2010, annual GDP growth averaged 10%. After 2010, the growth rate began to decline, falling below 8% in mid-2014, and now approaching 6% (from above). Even if China does not experience a sharp &ldquo;hard landing&rdquo; associated with the unraveling of excess indebtedness (discussed later), growth will likely continue to slow. This slowdown arises from challenges in raising productivity as China nears the technological frontier&mdash;at least in some areas&mdash;as well as labor market dynamics. Most long-run forecasts predict a significant &ldquo;kink&rdquo; in growth around 2028. At that point, China&rsquo;s labor force will begin to decline much more significantly than today, just as the burden of an aging population begins to kick in.</p> <p style="text-align: justify;">&nbsp;</p> <p style="text-align: justify;"><span style="color:#0000CD;"><strong>A Closer Look: The Political Economy of Chinese Growth in the Medium-Run</strong></span></p> <p style="text-align: justify;">Through 2006, promotion of export-led growth was a key motive of policy-makers; interest groups formed that were created by export-led growth; and these interest groups tended to support policies favorable to the country&rsquo;s post-reform development strategy.</p> <p style="text-align: justify;">Since 2007, this picture has changed dramatically as growth strategy has shifted. The structure of interest groups seems to have shifted. As China has changed from an important recipient of incoming foreign direct investment (FDI) to an important source of outgoing foreign direct investment (OFDI), new opportunities for lobbying and new interest groups have sprung up, for example among China&rsquo;s state-owned banks and corporations which have themselves gone global. Yet policy shifted dramatically at the end of 2016 from welcoming aggressive corporations expanding abroad to reigning them in sharply (for example Hainan Airlines, Wanda Corporation, and Anbang Insurance). The government now seeks to channel resources into state-controlled initiatives, both in the Belt and Road Initiative (BRI) and in international extensions of government-led technology initiatives. These steps were leading to heightened international conflict even before China&rsquo;s foreign economic environment was disrupted by the Trump shock.</p> <p style="text-align: justify;">Finally, we should make mention of politics. It has long been held not only as a statistical regularity but as a virtual law that when countries reached a certain threshold&mdash;around $6,000 in 1990 dollars or about $10,000 today&mdash;they were highly likely to democratize; the exceptions were largely oil states. China to date has not only proved an exception to this rule, but seems to be moving in the opposite direction under Xi Jinping. China is becoming more rather than less authoritarian.</p> <p style="text-align: justify;">&nbsp;</p> <p style="text-align: justify;"><span style="color:#0000CD;"><strong>U.S. Strategy: Integrating China into a Rules-Based Order</strong></span></p> <p style="text-align: justify;">The traditional U.S. approach to China involved emphasizing China&rsquo;s role as a &ldquo;responsible stakeholder&rdquo; in a global system of which it had been an enormous beneficiary. The approach was by no means static; as China&rsquo;s comparative advantage shifted, the U.S. sought concessions in areas that reflected changing U.S. comparative advantage, particularly as regards the investment and regulatory climate for American firms. Efforts to encourage China to sign up to international institutions with binding rules or to negotiate transparent bilateral commitments, however, were a key component. These were coupled with dispute settlement mechanisms for enforcement. In addition, foreign actors&mdash;including but not limited to the U.S.―presumed that an evolving legal and administrative system in China itself would provide the basis for foreign parties and their allies to check executive discretion and backsliding, thus keeping the reform process moving forward.</p> <p style="text-align: justify;">[&hellip;]</p> <p style="text-align: justify;">To be sure, the U.S. and China were clearly co-dependent. In the U.S., a coalition of powerful American firms had strong vested interests in the relationship because of their investments in China. These investments produced low-cost sourcing networks for a vast range of goods and also provided goods and services for the Chinese domestic market. The U.S. also benefitted from inflows of official Chinese capital to keep government borrowing costs low. Yet China was ultimately portrayed as the more vulnerable partner, needing access to the U.S. market and investment not only for economic reasons, but to deliver robust growth for domestic political reasons.</p> <p style="text-align: justify;">&nbsp;</p> <p font-size:="" nanum="" style="font-family: " text-align:=""><span style="color:#0000CD;"><strong>Challenges to the Liberal Approach: The U.S. Home Front</strong></span></p> <div style="text-align: justify;">A number of developments are clearly challenging this rule-based approach, starting with the radical departure from elite consensus reflected in the election of Donald Trump. There is ongoing debate about whether Trump&rsquo;s approach is personal and idiosyncratic. If so, then trade policy will simply &ldquo;snap back&rdquo; to the post-Trump consensus under a new president, whether Democrat or Republican. Although such a reversion to the historical mean is possible, there is a growing consensus that a genuine partisan realignment has occurred around trade issues, with the Republican base now more skeptical of globalization than its Democratic counterparts. Pressure to &ldquo;do something&rdquo; on trade vis-&agrave;-vis China is likely to persist regardless of who is in the White House or in control of Congress, in part because of rising concerns about Chinese grand strategy.</div> <div style="text-align: justify;">&nbsp;</div> <div style="text-align: justify;">&nbsp;</div> <div> <p style="text-align: justify;"><span style="color:#0000CD;"><strong>Challenges to the US Approach: China Reimagined</strong></span></p> <p style="text-align: justify;">First, while China continues to be a relatively open economy for its size&mdash;measured by trade as a share of GDP―there is growing evidence that its hybrid model is by no means trending in a more liberal direction. Although industrial policy never completely went away, the commitment of resources to industrial policy accelerated steadily since the shift noted above that occurred around 2006. In addition to the ongoing focus on exports, new attention was paid to achieving competitiveness in a range of cutting-edge industries. The roll-out of a series of policy tools mobilized to support these programs was emblematic of the new state-led push to foster indigenous innovation and upgrade manufacturing. Moreover, these developments were taking place in sectors that not only had relevance for China&rsquo;s economic position but for its military modernization as well (see Cheung 2019).</p> <p style="text-align: justify;">[&hellip;]</p> <p style="text-align: justify;">Second, the liberal presumption that the existing institutions constitute the only meaningful game in town is also being challenged. While the United States and Western Europe re-evaluate the efficacy of a rule-based approach, China is building its own international institutional alternatives. These include its tacit alliance with ASEAN on the Regional Comprehensive Economic Partnership (RCEP), a more-or-less explicit alternative to the TPP. Progress in RCEP has been slow in part because of the greater heterogeneity of the parties, most notably in India&rsquo;s foot-dragging. However, RCEP has potential strategic influence because it is an intra-Asian not trans-Pacific entity. Moreover, its consensus-driven approach to trade policy has a profound political logic: &ldquo;low-lying fruit&rdquo; and &ldquo;early harvests&rdquo; yield gains to the parties while difficult issues are pushed off. Although technically in violation of Article XXIV of the WTO, which calls for FTAs to liberalize &ldquo;substantially all trade,&rdquo; the RCEP may be rewriting rules around a looser, more iterative approach to trade policymaking that yields somewhat less but locks parties into an alternative to TPP-style negotiations.</p> <p style="text-align: justify;">&nbsp;</p> <p style="text-align: justify;"><span style="color:#0000CD;"><strong>Future Prospects and Medium-Run Scenarios</strong></span></p> <p style="text-align: justify;">What can we say about the prospects for U.S.-China relations going forward, looking not only at the short-run but the intermediate term? Three possible scenarios present themselves. The first possibility is that the &ldquo;reverse course&rdquo; visible in the two countries will prove to be an aberration. In this scenario, Trump&rsquo;s legacy is not enduring. In 2020, the U.S. turns back toward the well-worn divisions over trade policy, but with adequate bipartisan support for liberal rules of the road. This would not mean the end of pressure on China, but it would occur within established bilateral dialogues and through use of WTO and other bilateral mechanisms.</p> <p style="text-align: justify;">[&hellip;]</p> <p style="text-align: justify;">A second possibility, one we think more likely, is that skepticism about China in the U.S. will continue to rise and that Xi&rsquo;s legacy of a more statist political economy will endure in China. Yet even with the new directions staked out by Trump and Xi, the two countries might manage to negotiate a modus vivendi, however brittle, that would persist across administrations. Both sides would make compromises. Xi would need to make some concessions, most notably with respect to IPR issues, and Trump would not only have to roll back sanctions but promise&mdash;perhaps privately&mdash;to forego their use going forward. This path would not necessarily reflect a fundamental departure in worldviews; rather it would be driven by pragmatic concerns and rising uncertainties on both sides about the sustainability of trade conflict as costs mount.</p> <p style="text-align: justify;">[&hellip;]</p> <p style="text-align: justify;">The third possibility is for a period of sustained conflict in the U.S.-China relationship and even the possibility of what is now called &ldquo;decoupling.&rdquo; Unfortunately, there are already elements of this possibility in the National Security Strategy and other documents dealing with U.S. defense posture. The implications of chronic system conflict for the world economy are potentially grave and we can at least imagine the conflict generating a worldwide downturn. Yet we can also imagine this conflict taking very different forms, such as a gradual disengagement of the Chinese and American economies as both seek to diversify and build coalitions of support through their favored policy approaches</p> </div> <div style="text-align: justify;">&nbsp;</div> <hr /> <p style="text-align: justify;">&nbsp;</p> <p style="text-align: justify;"><span style="color:#DAA520;"><strong>Author&rsquo;s Biography</strong></span></p> <p style="text-align: justify;">&nbsp;</p> <p style="text-align: justify;"><strong>Stephan Haggard</strong> is Professor at the School of Global Policy and Strategy, University of California, San Diego. Haggard has written extensively on the East Asian developmental state; on comparative transitions to democracy and welfare states worldwide (with Robert Kauffman), and on North Korea. His most recent book is Developmental States (2018), in the Cambridge Elements series. Haggard has a Ph.D. in political science from U.C. Berkeley (1983).</p> <p style="text-align: justify;"><strong>Barry Naughton</strong> is Professor at the School of Global Policy and Strategy, University of California, San Diego. Barry Naughton has written extensively on the Chinese economy, with an emphasis on market transition, technology and trade, and political economy. His most recent book is the revised and updated edition of his textbook, The Chinese Economy: Adaptation and Growth (2018 from MIT Press). Naughton has a Ph.D. in economics from Yale University (1986).</p> <p>&nbsp;</p> </div>

.a_wrap {font-size:14px; font-family:Nanum Gothic, Sans-serif, Arial; line-height:20px;} Editor's Note Feiteng Zhong attempts to understand the rise of China by applying key concepts from international relations theory, such as the “balance of power” and “hegemony.” Zhong, however, points out that some concepts can be interpreted differently according to local contexts and thus it is necessary to look at a phenomenon from various perspectives to reach comprehensive understanding. As part of this effort, the author introduces a new concept, called “developmental security” as an alternative way to view China’s rise in the Chinese context. This concept is originated from China’s development-oriented grand strategy in which growth in GDP per capita forms the basis for national strategic goals, the interests of security and development are unified, and a peaceful environment around the region is fostered to promote domestic development.     Quotes from the paper  In the field of international relations, there are two main issues attracted great concerns related to the rising of China. First, will China return to traditional China, that is, to build a regional order in the surrounding areas similar to the Tributary System (Friedberg 2011; Pan and Lo 2017) Second, will China replace the U.S. and become a hegemonic power equivalent to the U.S. (Mearsheimer 2010; Kurth 2012)? For most Chinese scholars, both of them are not the best options (Zhong 2015; Qi 2015). According to the White Paper of China’s Policies on Asia-Pacific Security Cooperation issued by the China’s State Council Information Office on January 11th, 2017, the security framework in the Asia-Pacific region which was promoted by China “does not mean starting all over again, but improving and upgrading the existing mechanisms,” and “should be adopted as a common caused by all the countries in the region” (China’s State Council Information Office 2017). However, the challenge is what reasonable and feasible scenarios would be if those two options are not the case. This article concludes that China will neither become another U.S. nor return to the past, considering the fact that China is still the largest economy with far lower income levels than the U.S. by 2050. GDP per capita is closely related to a country's technical capability, the global vision of its domestic audiences, and its interdependence of the global economy. With the improvement of China’s GDP per capita, especially the gap between the eastern coastal areas of China and high income countries was greatly reduced, China is going to embrace globalization, but in a Chinese way. It is clear that China will face increasingly complex international security challenges to safeguard its growing interests abroad, but its main challenges remain at the domestic level, particularly in addressing the gap between the rich and the poor, regional imbalances and the sustainability of development.     China’s Development Path towards 2050 According to data released by the USDA in December 2017, China's per capita GDP was close to $7,400 in 2017, compared to that U.S. GDP per capita was $53,000, that of Japan was $48,000 and that of South Korea was $26,000. Even by 2030, China's GDP per capita is expected to be less than $15,000, which is equivalent to only 22.4 percent of that of the U.S. (USDA 2017). In October 2017, during the 19th National Congress of the CPC, Japan’s Institute of Energy Economics, released a forecast report on the future of energy development in 2050, which provides the economic development prospects of major economies in the world, especially the East Asia economies (The Institute of Energy Economics 2017). According to this forecast, as shown in Table 1, China's GDP per capita is expected to reach 14,000 US dollars by 2030, 22,000 US dollars by 2040 and 30,000 US dollars by 2050. However, in terms of economic size, China will account for 17.7 percent of the world's economy by 2030, according to the USDA. By then, the U.S. will account for 19.8 percent, while Japan and South Korea will account for only 6 percent and 1.6 percent respectively. According to projections from the Institute of Energy Economics in Japan, a size of China's economy will reach 89.8 percent of the U.S. economy in 2030 and 111.1 percent of the U.S. economy in 2040, making it the largest economy in the world. By then, the third-largest economy will be India, not Japan. Therefore, the world is entering a major stage of economic restructuring.   Table 1 Growth Prospects of China and Other Global Major Economies until 2050   GDP per capita GDP   2030 2040 2050 2030 2040 2050 China 14.4 22.1 30.1 20311 30759 40328 India 4.0 6.4 9.5 6133 10236 15857 Japan 57.6 67.4 77.2 6948 7705 8329 Korea 35.6 43.6 52.2 1877 2284 2633 United States 63.5 74.6 84.1 22629 27677 32902 China/U.S. 22.7% 30.0% 35.8% 89.8% 111.1% 122.6%                      Source: The Institute of Energy Economics (2017).       Understanding the Traditional Paradigm of Power Transition between China and the U.S. [T]he relationship between hegemony and international order has long been a subject of discussion in the field of international relations. Robert Gilpin, the late professor at Princeton University who wrote about this in the early 1980s, argues that war is the main driver of systemic change. Robert Keohane, on the other hand, believes that the decline of hegemony does not necessarily lead to the collapse of the international order, because other countries benefit from it, and several countries can join together to maintain the international system. At present, the debate is still continuing. John Ikenberry, a liberal scholar at Princeton University, argues that China also benefits from the American order and will not overturn it (Ikenberry 2018). Other realists, such as John Mearsheimer, argue that China's rise is likely to lead to a war between China and the U.S. (Mearsheimer and Walt 2016). […] China and the West have different views on Great Power. The core lies in that the western concept of great power is based on military power, while the popular concept of great power in China mainly refers to the size of population and land, without economic and military implications. With the rise of China's economy, new meanings with economic power were added to the concept of China’s great power. However, the Chinese government still considers itself as the biggest developing country in the world, a concept broadly used since the mid-1980s (Zhong 2019).   Developmental Security: A New Perspective Understanding China’s Rise If we recognize the importance of per capita GDP in understanding international security issues, we will have a new perspective to examine the state of peace between China and its neighbors since the reform and opening up. At present, many scholars in Asia are talking about getting rid of the "middle-income trap." From a global perspective, it is more important to summarize how Asian countries get rid of the "low income trap." According to Robert Barro, a macroeconomist at Harvard University, the average annual growth rate in the west over the 200 years since the industrial revolution has been two percent. If developing countries are to catch up, especially if they are to get rid of two income traps, it will take a 25-year average of 2.9 percent growth in each income stage (Barro 2016, 14). Barro also believes that getting out of the "low income trap" is far more difficult than getting out of the "middle income trap." In 1998, China graduated from low-income countries and became a lower middle-income country. In 2010, China became a high middle-income country. From 1990 to 2011, China reduced the number of poor people by 439 million, making a huge contribution to global poverty reduction. Some scholars have pointed out that China's poverty reduction policy experience is of great significance to many low-income developing countries (Pan and Chen 2016, 135-143). At the same time, China's national security policy and its ideas of foreign relations should be given equal attention. China's national security philosophy is quite different from that of the U.S. The basic international political concept of the American elite is based on the history of European international politics. The most prominent one is the concept of balance of power. The Chinese government has highlighted the correlation between domestic security and international security and its ability to highlight the state of sustainable security in the definition of national security. In this regard, it is similar to the concept of "comprehensive security" proposed by Japan in the early 1980s. China's grand strategy is a strategy of internal and external balance (Zhong 2018). More fundamentally, since the reform and opening up, China has implemented a grand strategy based on development, which can also be called "developmental security." It has three basic characteristics: first, it takes the development of per capita GDP as the basis for constructing national strategic goals; second, security interests and development interests are unified, and there is a coordinated relationship between military expenditure and domestic socio-economic development. Third, we should foster a peaceful environment around the region that is conducive to development (Zhong 2017). It is hard to imagine how peace in East Asia could have lasted so long since the late 1970s, if a rising China had not adopted such a strategy.   A Complex and Networked Asia Pacific Order Conceptually, Robert Keohane and Josephy Nye demonstrated in the late 1970s that the overall power distribution does not correspond to the issue-area power distribution. A country with a small economy can also become one of the world's top countries in individual issue areas. When Keohane and Nye proposed the concept of complex interdependence, the empirical facts on which it was based came mainly from the relations between the U.S. and Canada, Australia and the European countries, when the average per capita GDP of Western developed countries was close to $10,000. By this measure, as China's per capita GDP increases further, many countries in China's neighbors can reach this level. According to the current calculation, if the initial results of the BRI are achieved, the GDP per capita of countries involved in the BRI can also be doubled in the next 15 years, which will deepen the complexity of China's neighbor relations. If complex interdependence can be applied to developed countries in the 1970s, the concept can also generalize China's future relations with regional countries. […] [I]n the conception of the Asia-Pacific regional order in 2030 and 2050, one should not look for clues only from the Western theories of international relations. In various Western theories of international relations, scholars generally believe that the core mark of a great power is military capability (Zhong 2017b). Although China attaches equal importance to military capabilities, the development of military capabilities should match the needs of the domestic economy and society under the development security strategy. Moreover, since the founding of a new China, China's military expenditure has never reached the corresponding level of the U.S. in terms of the proportion of its economy size. While neighboring countries often accuse China of the increase in military spending at an average annual rate of 10 percent, they have never simultaneously considered that China's economy has grown at a similar rate over the past four decades. Some scholars have pointed out that, if measured by military spending as percentage of total governmental expenditure, China's military growth rate is even lower than domestic expenditure. In this regard, international observers need to have a better understanding of China's domestic affairs and the affairs of the Asian region, which means frequent visits to China and its neighbors, frequent comparisons of regional differences, and efforts to seize the interests and development trends of all parties from various complex regional and trans-regional phenomena.     Author’s Biography   Feiteng Zhong is Professor and Head of Department of Great Power Relations Studies, National Institute of International Strategy, Chinese Academy of Social Sciences. He received his Ph.D. (2009) in international relations from the Waseda University as well as the Peking University. He is also the author of "Developmental Security: China Rise and Regional Order Reconstruction" (China Social Sciences Press 2017). His main research interests include International Political Economy, The Political Economy of the Belt and Road Initiative, China's Foreign Policy, East Asia and the United States.