In the past thirty years, China’s ascendancy and the economic growth of India and smaller Asian states have gradually shifted the global political centre from the Atlantic Ocean to the Pacific Ocean. In the Great Game of the Twenty-First Century, the United States and China are playing leading roles. President Barack Obama has declared that U.S. foreign policy will shift focus toward the East Asian-Pacific region now that the United States plans to end its war in Afghanistan in 2014 and to cut its defense budget by USD 400 million annually in the following ten years.
Southeast Asia will be prime turf for competition between China and the United States. China can be expected to expand its clout primarily in that very region. More than half of China’s oil exports are transported through the Strait of Malacca in Southeast Asia. The Strait of Malacca is one of the world’s most important sea-trade corridors through which about forty percent of global trade (including Chinese oil imports) passes every year. Trade volume there is estimated to be USD 5.5 trillion, of which U.S. trade accounts for more than twenty percent.
America is naturally interested in free and safe sea-trade routes in the region. China’s potential threat to that interest motivated the United States last year to deepen its defense cooperation with the Philippines. In 2011, the United States also entered into a bilateral agreement with Australia to deploy 2,500 U.S. Marines and military aircraft there. The United States already has large military bases in Japan, South Korea and Diego Garcia, an island located in the central Indian Ocean.
China realizes that its heavy reliance on the Strait of Malacca for oil exports is a strategic vulnerability. The country is trying to increase its influence in the region by means of a so-called “string of Pearls” strategy to establish naval and other military bases in the Indian Ocean. China also has claimed territorial control of the Spratley Islands in the South China Sea (along with the islands’ natural resources) – a claim disputed by other states in the region and rejected by the United States.
Southeast Asia is the focus of attention by India and Japan as well. Both countries are interested in the region because of its considerable economic possibilities. The two countries are viewed as allies of the United States along with the Southeast Asian countries (including Australia) and South Korea.
China, the world’s largest country by population, counts more than 1.3-billion people. India lags behind with about 120-million fewer people. By contrast, the total population of the Southeast Asian states, Japan, South Korea and Australia combined is only about 800-million people.
In the sphere of defense, China spends about six times less than the United States. But China’s defense budget (around USD 110 billion, according to 2010 data) still exceeds the combined defense expenditures of Japan, India and South Korea.
China’s external rivals, excluding the United States, may be able to counteract China through political alliances and economicintegration. However, they will find it difficult to compete with China in the defense sphere. For them, U.S. military bases in the region provide a balance of powers.
Nationalism will play its own role. That historic narrative is not unfamiliar to foreign policies of Asian countries. The continued strengthening of China can only intensify nationalistic rhetoric. In the mid-Twentieth Century, nationalism succeeded in liberating Southeast Asian countries from European colonial rule as well as from Japanese aggression. In the 1960s and early 1970s, the Vietnam War was unsuccessfully waged by the United States against nationalist forces determined to unify Vietnam under a communist government.
Central Asia is attracting less attention today than it did during the Great Game of the Nineteenth Century. Yet, this energy-rich region today constitutes a potential hotbed of Islamic extremism and a danger zone on the continent. Zbigniew Brzezinski, the U.S. National Security Advisor to President Jimmy Carter from 1977 to 1981, calls the region “the Balkans of Asia.”
Central Asia fell under the influence of Russia in the Nineteenth Century. After the breakup of the Soviet Union, Russia’s position weakened there and Americans decided to step in and try to democratize Central Asia. The 11 September 2001 terrorist attacks convinced the United States to reorder its priorities and to place greater emphasis on establishing military alliances with local authorities. As American journalist James Brooke notes, America and Russia share “a rare point of common ground” in protecting the region from Islamic extremism.
Central Asian oil and natural gas supplies fall, first of all, within the scope of China’s interest. The combined oil reserves of the five Central Asian countries are estimated at up to 47-billion barrels. The Caspian Sea basin cannot replace Central Asia in terms of potential supply, but it can alleviate China’s dependence on oil imports by sea.
Central Asia accounts for five percent of world natural gas production. The largest reserves in the region are in Turkmenistan, though data differ. According to the 2011 estimates of the global consultancy and audit company of Gaffney, Cline & Associates, Turkmen natural gas reserves comprise a minimum 13-trillion cubic meters (fourth largest in the world); the U.S. Central Intelligence Agency World Factbook estimate of the 2011 Turkmen supply is 7.5-trillion cubic meters (sixth largest in the world).
The construction of a pipeline carrying Turkmen gas to China was completed in 2009. The pipeline originates in Turkmenistan and runs through Uzbekistan and Kazakhstan before connecting in China. The pipeline is nearly 2,200 kilometers long and has a throughput capacity of 40-billion cubic meters of natural gas a year. In addition, a 2,200-kilometer-long oil pipeline also runs from Kazakhstan to China.
For years, Russia purchased oil from Turkmenistan at a much cheaper price than the world-market price, reselling it at a higher price. In 2008, Russia sold 170-billion cubic meters of natural gas in Europe, of which twenty-five percent was Turkmen while ten percent was Kazakh and Uzbek gas. The opening of the Turkmenistan-China and Turkmenistan-Iran gas pipelines challenges Russia’s energy monopoly.
Afghanistan and Pakistan
Another problematic spot in Asia is chronically unstable, ethno-conflict-prone Afghanistan. On the one hand, the country is located along the road from Central Asia to the Indian Ocean; on the other hand, it represents a link in the chain connecting South Asian countries with Central Asia. A greater presence in the region would be an interest of India, which has begun establishing closer ties with the current Afghan government. The withdrawal of U.S. combat troops in 2014 may place India in a stronger position of influence. Expansion of India’s clout in Afghanistan is opposed by Pakistan - an ally of China. America is extremely interested in the stability of Pakistan, which is equipped with nuclear weapons and represents yet another hotbed of ethnic and religious conflict. For its part, China is pursuing its aim of reaching the Indian Ocean via Pakistan and is using Pakistan to counterbalance India in Asia.
Myanmar and North Korea
Still-underdeveloped Myanmar may become a stimulus for the development of other underdeveloped countries in Asia. After being ruled by junta for decades, the country now has a civil government which has even undertaken some democratic reforms. In December 2011, U.S. Secretary of State Hillary Clinton visited the country and pledged improved U.S. relations if Myanmar reforms continue. Chinese and Indians lavishly finance infrastructure projects there. Within several years, Delhi and Beijing may have direct motor and rail links via Myanmar.
The threat of a nuclear-armed North Korea will be high on the agenda as well. Prolonging the life of North Korea’s totalitarian regime would provide China with an advantage in its relations with America and Japan. If the North Korean regime were to fall and the country were to reunite with South Korea, the balance of power in East Asia would change to the disadvantage of China.
Old and New Great Game
Parallels can be drawn between the continuing rise of China in the Twenty-First Century and the strengthening of Japan in Asia and Germany in Europe in the Twentieth Century. The rivalry of Germany with the British Empire culminated in World War I. Japan was an ally of Nazi Germany in World War II, which ended in the occupation of a whole set of Asian states, including China. A conflict of similar scale is unlikely in the Twenty-First Century given global economic interdependence. However, given multiple hotbeds in Asia, local conflicts cannot be ruled out.
Similar to the original Great Game in which Britain tried to contain Russia without direct military conflict between the two empires, the United States will refrain from direct confrontation with China. The United States will instead rely on an “offshore” balancing strategy and try to balance China by means of local actors – India, Japan and other countries. In the new Great Game, smaller countries will have greater opportunity to play an active role. By opening energy markets, Central Asian countries will have a chance to maneuver between Russia and China. Southeast Asian countries may be able to strengthen their positions by deepening regional integration through ASEAN (Association of Southeast Asian Nations). At the end of the day, the rivalry of giants may benefit smaller countries the most.
This article first appeared in Tabula Georgian Issue # 87, published 13 February 2012.