Pre-eminence of Chinese Economic Concerns

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Economic considerations with respect to regional security might be conveniently divided into two categories:

            1. The relative national priorities assigned to the development of national economic power and to the development of military power.
            2. Economic security and economic interdependence as key factors in security relations with neighboring countries.
With respect to the first category, Beijing’s view of the relative importance assigned to economic development compared to defense modernization. First, there is the obvious fact that China over recent decades has achieved far greater success in its national economic development than in its military modernization. One of the reasons for this is that both Chinese policy pronouncements and practical emphasis have been directed to the pre-eminence of national economic development.

“China unswervingly keeps national defense construction in a position subordinate to and in the service of the nation’s economic construction”


Whether or not such statements are accepted by outside observers. One may argue, for example, that economic success is the most important factor in fueling modernization of the People’s Liberation Army (PLA). On the other hand, it is obvious that the PLA does not get all that it wants and that economic (budget) considerations are a major factor in procurement decisions. A well-connected and well-informed PLAN officer has stated bluntly, “If there were enough money, the PLAN would have a carrier now.”


Although some may quibble about the practical application of this oft-stated priority of economic development over building the military, it is clear that this category of economic consideration is a primary factor in China’s regional security. The PLA has been constrained both by direct budget limitations and by its inability to acquire and assimilate technology rapidlyin significant part a function of inadequate funding for research and development. Consequently, Beijing necessarily views its rise to the status of a regional (and prospective global) power more in terms of economic development than military capabilities.

“The political security situation in the Asia-Pacific region is relatively stable. The development of the trend toward multipolarity in this region is being quickened. Despite the emergence of a financial crisis in Asia, the Asia-Pacific region remains one of the areas with the greatest economic development vitality in the world, and developing the economy is the most important task for each country.”

Although the partially modernized PLA is without question a formidable regional military force, it is not as modern, as large, or as threatening as it might have been had Beijing given high priority to developing a more powerful force. The regional security situation would have been markedly different if China had devoted greater attention and resources to the PLA and if the PLA had been able to absorb the systems and technologies it might have received (a very big “IF”).

The second category of economic consideration encompasses both economic security and economic interdependence. When Beijing views its regional security relations, it sees them more and more through an economic lens. China, in an increasingly sophisticated way that has been further intensified by the Asian economic crisis, looks beyond the stark outlines of military confrontations and threats when it contemplates its neighbors, as illustrated by this excerpt:


“Economic security is becoming daily more important for state security. In international relations, geopolitical, military security and ideological factors still play a role that cannot be ignored, but the role of economic factors is becoming more outstanding, along with growing economic contacts among nations. The competition to excel in overall national strength, focused on economy and science and technology, is being further intensified; globewide struggles centered on markets, natural resources and other economic rights and interests are daily becoming sharper; and the quickening of economic globalization and intensification of the formation of regional blocks render the economic development of a country more vulnerable to outside influences and impacts. Therefore, more and more countries regard economic security as an important aspect of state security. The financial crisis in Asia has made the issue of economic security more prominent, and has set a new task for governments of all countries to strengthen coordination and face challenges together in the course of economic globalization.”

In other words, China’s regional security relationships cannot be framed in traditional military security terms. Economic considerations, even if not seen as replacing military means, are given priority over military development considerations. Moreover, economic factors are seen as more important than conventional threat analysis and force comparisons or balances. Economic security has top priority, and economic interdependence is seen as a primary tool in managing regional security. This is not because China has become benevolent or ignores the utility of military forces in the region, although those forces have been assigned a clearly subordinate, albeit still significant, status. It means at least that the PLA cannot do all that China might wish of it, and that other meanseconomic and politicalmust be relied upon, at least in the short term. This further suggests that these may be seen by Beijing as the preferable means for the long term as well. China cannot compete with Japan or even a weakened Russia, for example, and excel in a specifically military sense, especially with U.S. forces present in the region, but it can lean much more heavily on the economic aspects of overall national power. It can make the most of its economic ties and work to minimize economic tensions with its neighbors, all the while pursuing modernization of the PLA at a pace that places minimal drag on the national economy and is not unduly upsetting to other nations.


Over the longer term, China could eventually become a much more formidable military power, especially regionally. There could be temptation to re-emphasize military means in regional security relations. Further, it is hardly certain that the leadership in Beijing will recognize fully the implications and opportunities of China as an economic giantand the implications of squandering those opportunities and potential in a military adventure. Despite appearances, it may not be understood or appreciated fully in Beijing that greater economic clout concomitantly implies that economic security is the overwhelmingly important consideration in China’s strategic relations with peripheral states and the world at large. Beijing’s rhetoric still emphasizes force; so it is not a foregone conclusion that Beijing will continue indefinitely down its present path. If Beijing were to continue into the next century to rely primarily on economic considerations, it would be because of a fuller appreciation by the Chinese leadership that China’s true national power lies primarily in its national economic development and regional economic relations rather than in its military modernization and defense “construction.” Already Beijing seems to have accepted that the penchant to resort to hostilities is effectively deterred when regional countries appreciate that the increasingly important economic ties with neighboring countries would be severely jeopardized or even severed were military forces to be employed.


For now and for the future, the manner in which Beijing incorporates this sort of thinking into its strategic calculus will reveal the degree to which Chinese leaders truly recognize that China’s interests are better served by avoiding or resolving conflicts through economic power and political maneuver rather than employment of military force. In the final analysis however, China is doubtless seeking to gain what it sees as an appropriate mix of economic, political, and military power. Of interest is whether the relative priorities assigned these three kinds of power will remain as they appear now, with economic considerations having the greatest importance. This would offer a welcome measure of assurance that Beijing means what it says about a strong preference for relations based on peaceful cooperation and friendship and that, as seems to be the case, Chinese strategic thinking is profoundly and permanently influenced in a favorable direction by the economic considerations described.

Taiwan, of course, is a somewhat different matterbut possibly less so than it might appear at first glance. There is no question that Beijing gives full emphasis to its ability to cope with the military forces of Taiwan and to deter, discourage, and intimidate the government and populace. However, even in this seemingly irreconcilable situation, the enormous economic factors at play in cross-strait relations raise at least the faint hope that as economic links continue to gain importance, more traditional military considerations will tend to wane even with respect to Taiwan.

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