FRIDAY, April 26, 2024
nationthailand

To benefit from China, we must first understand why we matter to Beijing

To benefit from China, we must first understand why we matter to Beijing

China’s increased investment in Southeast Asia has triggered concern over whether Beijing can behave responsibly, or whether regional hegemony is its true aim. 

But less has been said about one question: Why does Southeast Asia matter to China? What drives China to pump billions of dollars into Indonesia and its neighbours? Last year China became the second largest investor in Thailand after Japan, and the third largest in Indonesia after Japan and Singapore.
China is now Indonesia’s largest trading partner. 
So, what does it mean to be a strategic partner for China?
Since the early 2000s, China has signed strategic partnership agreements with 47 countries and three international organisations – including the Association of Southeast Asian Nations. This boom in China’s partnerships signals Beijing’s embrace of globalisation and use of diplomacy to secure core interests and a peaceful rise as a global power.
Chinese Premier Wen Jiabao, in 2004, unveiled a foreign policy of all-embracing partnerships that would transcend differences in ideologies and social systems. It seeks to expand converging interests and seek common ground on the major issues while shelving differences on the minor ones – including south China Sea disputes. The seven Asean members that have inked strategic partnerships with China are Thailand, Indonesia, Vietnam, Cambodia, Laos, Myanmar and Malaysia.
China uses the partnership as a diplomatic tool to protect its core interests of state sovereignty, national security, territorial integrity and national reunification – all of which are enshrined within partnership documents.  
But the key reason for China’s partnering up with Asean members is national security. More specifically, Beijing is looking towards its neighbours in order to secure its huge energy demands. Energy security for China means the acquisition of sufficient supplies to protect Beijing’s core objectives.
In recent years China has emerged as a global player in the energy sector due to soaring annual economic growth of between 9 and 10 per cent after 1980. Since 2012 China has maintained an impressive growth of 7 to 8 per cent despite the global downturn. The result is a massive demand for energy that necessitates the acquisition of  sources worldwide. Domestic sources are scarce except for low-quality Chinese coal.
China became a net importer of oil in 1993, of gas in 2007, of coal in 2008 and the top global oil importer in 2014. In 2014, China sucked up 30 per cent of global oil and 45 per cent of global coal. 
Here lies the reason for Asean’s strategic significance for China. About 60 per cent of Chinese oil imports are shipped through the Strait of Malacca. Strategic partnership with Asean helps mitigate the risks of disruption to this energy lifeline from piracy, congested traffic, terrorist attacks and especially the naval forces of other major powers like the United States and Japan.
One way of mitigating the risk in the Strait of Malacca has been the construction of an oil and gas pipeline from Maday Island in Myanmar to Yunan in China, which has been operating since 2015. It has cut oil-transport time by 30 per cent the time and reduced the risk of piracy and other dangers. 
Meanwhile in November last year, China and Malaysia signed deals on defence and agreed to resolve their South China Sea dispute on a bilateral basis rather than through Asean. This further secures China’s energy interest in the Strait of Malacca and South China Sea.
Asean countries are on all of China’s energy shipping routes from the Middle East, Africa and Latin America. Therefore, it is in China’s core interest to maintain peace and stability in the region and seek closer economic cooperation with Southeast Asian states.
When he came to power in 2014, President Joko Widodo projected Indonesia as a maritime power and this has become central in jakarta’s relations with Beijing, sitting well with China’s ambition for a Maritime Silk Road.
For Asean member countries to maximise the benefits of their relations –trade and otherwise – with Beijing, it is crucial that they understand precisely why Southeast Asia matters to China.

Emanuel Bria is Asia Pacific senior officer and Indonesia country manager at the Natural Resource Governance Institute.

RELATED
nationthailand