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Tierney Walls

4 May 2015

IR 364

Multilateralism in China

In the current world of growing economic interdependence and

globalization many countries have come to see the benefits of

multilateral agreements and institutions and have decided to

partake in them. China is a relative newcomer when it comes to

multilateralism. “Multilateralism is defined as the tendency and

preference of a country to use multilateral diplomacy as a means

to attain its foreign policy ends.”1 Prior to working with the

Association of South East Asian Nations, China had insisted on

maintaining their bilateral relationships while avoiding

multilateral ones. China felt that bilateral relationships and

meetings were the only acceptable ways of achieving their foreign

policy goals and that they were more effective in binding their

partners. China also thought that multilateral organizations were

being used as instruments of imperialistic nations to enhance

their agendas at the expense of other’s sovereignty. Chinese

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leaders were under the impression that multilateral institutions

were too constraining and could not compete with the

effectiveness of bilateral relations and one-on-one agreements.

China could have easily continued down this path of

rejection of multilateralism by maintain and increasing the

number of bilateral arrangements it had. Instead it chose the

option that led them to eventually join multilateral institutions

and agreements. In the 1970s under the

1Kuik Cheng-Chwee,” Multilateralism in China's ASEAN Policy: Its Evolution, Characteristics, and Aspiration,” Contemporary Southeast Asia: A Journal of International and Strategic Affairs, 27:1 (2005): pp. 104

enforcement of Mao Zedong, China participated in selective

engagement with international institutions and wanted to join the

United Nations. The United Nations was a helpful tool in

increasing China’s interest in multilateral institutions because

it proved to the Chinese that they could have a real say in what

was going on in the world. The veto power that China contains in

the United Nations was also useful because it gave them a sense

of power.

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China drifted further towards multilateralism in the 1980s

when they developed and began the practice of their “Open Door

Policy.” By opening itself to the international community China

was able to increase trade and was able to begin to their repair

relationships with other nations. The liberalization of Chinese

trade and the internal economic reforms were just the beginning

of what we see today, an economically globalized China.

Since the late 1980s, China’s foreign policy has “shifted to

one founded on strategic nonalignment and active participation in

the international economy.”2 Many international institutions and

nations have been pushing for China to join multilateral

institutions and they welcome China’s multilateralism or their

“New Diplomacy,” with open arms.

So far China has seen the many perks of joining both

governmental and nongovernmental multilateral institutions.

Guoguang Wu describes, “China has developed an expanding

involvement in regional and global interstate politics and

various international, multilateral organizations, and has

benefited much from such participation in terms of technology

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transfer, trade development, foreign-investment inflow, and

cultural and educational exchanges.”3

Multilateralism diplomacy has allowed China to attract foreign

investment inflow and has helped

2Hongying Wang, “Multilateralism in Chinese Foreign Policy: The Limits of Socialization,” Asian Survey, 40:3 (2000): pp. 478.3Samuel S. Kim, “China’s International Organizational Behaviour,” in Thomas W. Robinson and David Shambaugh (eds) Chinese Foreign Policy: Theory and Practice, Oxford: Clarendon Press, 1994, pp. 401–34.China to get better terms for trade. China’s current goal is to

maintain consistent growth and to try to benefit as much as they

can by joining multilateral institutions.

Since the ASEAN Regional Forum (ARF) was founded in 1993,

China has begun to work with the Association of South East Asian

Nations, a multilateral group in their region that focuses on

easing relations and facilitating talks between the different

member nations. ASEAN also works to try and resolve any regional

problems and protect each of its members with the ASEAN Regional

Forum. Although China has joined multilateral institutions, it is

clear that its multilateralism can be seen more on a regional

level rather than a global level. China has a lot more influence

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in their region then they do in other parts of the word and that

is why their multilateralization is much stronger and more

visible in China’s geographical region. Since China wants to

promote its own foreign policy and economic agenda it makes the

most sense for them to try and do so first and foremost in places

where it possesses the most economic and strategic influence,

which is in eastern Asia.

It is also clear that China does not like to be bound to

agreements in which they have little say, as is true with all

nations in the international system. Instead, China appears to be

more focused on increasing their material power. The easiest way

for China to increase their wealth and material power is by

establishing and promoting policies that benefit them. Many

countries in the world, such as the United States or the United

Kingdom, would not be able to be persuaded or coerced into

multilateral agreements that favor China. The same cannot be said

for its regional neighbors. China has much more influence and

persuasive power over its smaller neighbors and that’s why

multilateralization works so well for them in the region. The

reason the countries in the region are willing to participate in

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Chinese-dominated militarism is because they have a lot to gain

from it. Chinese-dominated multilateralism can be described as

any multilateral arrangement where China takes the lead and has a

large, or even the largest presence and receives the greatest

payoffs. The smaller regional countries that work with do not

just gain economic power. From working with China in multilateral

institutions, they can also get spillover of technological

knowledge and skillful diplomacy.

Different international relations and political science

scholars will provide various reasons why they think China has

decided to join multilateral institutions. The main argument for

the multilateralization of China is that it, “has been driven by

its underlying aspiration to shape the "rules of the game" for

regional institutions, for the ultimate ends of fulfilling the

needs of a range of foreign policy concerns.”4 I believe that the

main reason is an international relations liberal or an economic

reason. It is evident that China can be an active participant in

multilateral institutions but the question we have to ask is why

have they decided to? The three main theoretical approaches to

explaining Chinese multilateralism from 1980s to the present day

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are a realist approach, a socialist or constructivist approach,

and a liberal economic approach. Each have explanatory power in

some situations but there are holes in the realist and the

socialization/constructivist explanations for the

multilateralization of China. China has derived many benefits

from its participation in multilateral institutions but there are

limits to the extent of their multilateralization. In other

words, although there are explanations to why China can engage in

multilateral diplomacy, but there are also explanations to why

China might find it difficult to participate or maintain its

presence in a multilateral institution.

4Cheng-Chwee, 115

The puzzle that I have been looking to answer is: Why has

China officially decided to engage in multilateral diplomacy? In

which way have they done so and what are the implications for the

future of Chinese multilateralism? I will test three theories of

Chinese multilateralism, a realist one, a constructivist and a

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liberal explanation. In doing so I will show how realism and

constructivist are limited in explaining Chinese multilateralism

and I will explain why the liberal economic motives are better

for explaining Chinese engagement in multilateral arrangements. I

will also provide examples of Chinese regional multilateralism to

support the liberal economic explanation. By understanding

Chinese foreign policy and national goals and by looking at the

proposed and negotiated regional free trade agreements they are a

part of, I come to the conclusion that as long as China continues

to further its material wealth and reap great economic reward, it

will continue engage in multilateral diplomacy and promote

policies that benefit them the most.

Realism as an explanation

To begin with, the realist paradigm of international

relations has an explanation to the increased internationalism

and multilateral participation of China. Realists such as Kenneth

Waltz, believe that balance of power is the underlying cause of

all issues in the international arena. They argue that China’s

growth, economically and militarily, has inevitably caused fear

from other leading nations in terms of security. It is true that

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when a nation rises, it can threaten to rearrange or disrupt the

international system. If realism is a powerful explanation for

Chinese multilateralism we should see China modernizing their

military with aim to counterbalance the United States. Some

pessimistic realists also believe that China will become a threat

to regional neighbors and to international security, similar to

that of Germany, Japan and Russia during the early 20th century.

Balancing

John Mearsheimer, in The Tragedy of Great Power Politics,5 argues

that China will try to further its dominance in the region by

widening the economic and military gaps between China and the

surrounding nations. The problem with this realist explanation is

that it does not account for the fact that some nations can rise

peacefully and do not intend to pose a threat to the

international system. Chinese leaders say that China wishes to

rise peacefully and it actually appears to be doing so. In

contrast to realism which claims that states desire to be on top

and rising powers seek to alter the current international power

system, China appears to have no real intention to do so.

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The balance of power theory of realism also argues that

weaker states will join together with the second strongest power

in the system to balance against the strongest. If this theory of

realism is a valid explanation it is understandable why other

countries in the region would try to work with them to balance

against the United States. But in reality it is hard to imagine

that these nations would try to actively try to produce an

alliance to balance against the United States. It appears that

that ASEAN nations are working with the Chinese to constrain

China rather than to bandwagon with them. China is also working

with nations in the region to reap economic rewards rather than

to form a coalition against the United States. Also, as C.R.

Hughes describes on his discourse on nationalism and

multilateralism in China, “even though some may consider the

ASEAN or the ASEAN+3 to be making an attempt at balancing against

the United States, Such balancing of US power remains light so

long as China is unable to explicitly treat ASEAN or the ASEAN+3

as a ‘pole’ of global power.”6 Instead it is suggested that if

China is truly

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5John J. Mearsheimer, The Tragedy of Great Power Politics, (New York: Norton, 2001).6Christopher R. Hughes, Nationalism and Multilateralism in Chinese Foreign Policy: Implications for South East Asia, The Pacific Review (London, United Kingdom.: Routledge, 2005),pp. 130

concerned about protecting and projecting its relative economic

power it cannot scare its partners in the region by trying to

widen its influence too quickly. Since the United States plays an

important role in the region and is considered by some nations a

“protector” for their external security, China must be cautious

in its efforts to thwart US influence. It has to maintain

relatively friendly relations with the United States in order to

retain friendly relations with some of its neighbors. Therefore,

balance of power theory of realism is a weak explanation for the

multilateralism of China.

Peaceful Rise

It was made clear that China is trying to peacefully rise in

the Chinese White Paper of December 2005. This paper titled,

“China’s Peaceful Development Road,” says that:

“Peace, opening-up, cooperation, harmony and win-win are our policy, our idea, our principle and our pursuit. To

take the road of peaceful development is to unify domestic development with opening to the outside world, linking

the development of China with that of the rest of the world, and combining the fundamental interests of the Chinese

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people with the common interests of all peoples throughout the world. China persists in its pursuit of harmony and

development internally while pursuing peace and development externally; the two aspects, closely linked and

organically united, are an integrated whole, and will help to build a harmonious world of sustained peace and

common prosperity.”7

China explicitly describes its intent to develop peacefully which

contradicts the realist explanation for multilateralization.

Chinese Military Modernization

Studies actually show that China is not modernizing their

military at the same rate as Japan and

Germany did and even though they’re doing so, there is no proof

that they are enhancing their

7The State Council Information Office, “China's Peaceful Development Road” White Paper English.People.CN December 22, 200

military capabilities to counter the United States. China is

indeed concerned about increasing their economic strength and

modernizing their military but it claims that these are acts of

an internal goal to raise the Chinese standard of living rather

than to become a regional or global hegemon.

Restrained/Benevolent China

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China is well aware that competing nations in the

international system wish to restrain them and that integrating

it into the international system through multilateralism is one

way to do this. If China wishes to be seen as a benevolent power

they must join institutions and constrain themselves. Perhaps

this is one of the reasons why China has moved towards

associating with ASEAN and has cooperation in the United Nations.

Also, in order for China to appear restrained, it has made itself

available to multilateral dialogues on security issues through a

number of other regional forums, such as the Conference on

Interaction and Confidence-Building Measures in Asia (CICA), the

Council on Security Cooperation in Asia and Pacific Region

(CSCAP), Northeast Asia Cooperation Dialogue (NEACD) and the

ASEAN Regional Forum (ARF).

Limits to these Arguments

Although China has increased its international participation

in multilateral organizations, its security commitments to these

conferences and councils are limited. One reason being that, the

Chinese government does not want to increase transparency in

their military. Without China’s military being transparent, it is

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hard for other nations to understand what is going on in China

and it is hard for them to figure out what China really wishes to

gain from these security arrangements.

Another reason that limits China in its multilateral

security alliances rests on one of China’s main foreign policy

stances, which declares that China does not want to delegitimize

the sovereignty of other nations. China will hesitate to agree to

multilateral arrangements that appear to jeopardize the

sovereignty of other nations. Sovereignty has been one reason for

Chinese leaders to argue in favor of handling their disputes in

the region via bilateral negotiations rather than multinational

mechanisms. China overall still prefers to all security

agreements to be flexible and optional so as long as they have

the option to not participate in events that threaten the

sovereignty of other nations, it may likely still participate in

various multilateral arrangements. The notion of sovereignty also

has to do with the realist value of security. The realist theory

also tends to claim that the question of security is the main

concern of every state. China’s participation is relatively weak

in regards to its response to regional security issues so it

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appears that security is not the driving issue behind Chinese

multilateralism.

Constructivism/Socialization as an Explanation

The constructivist or socialization theorists argue that

China is becoming or will need to become “socialized” and for

this reason it has converted to multilateralism. Multilateralism

is a key part of socialization because it is central in making

agreements that affect many nations, rather than just two. Since

so many nations are involved, they tend to have a greater impact

on one another. Being part of a multilateral institution means

that you are being exposed to international norms and rules. In

fact, “Some scholars argue that states are embedded in dense

networks of transnational and international social relations that

shape their perceptions of the world and their role in the world.

States are socialized to want certain things by the international

society in which they and the people in them live.”8

Multilateralism allows states to come

8Martha Finnemore, National Interest and International Society (Ithaca, N.Y.: Cornell

University Press, 1996), pp. 2

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together and follow a general code of conduct when joining

multilateral institutions or agreeing to large multinational

treaties.

The problem with this theory is that there are many norms in

the international system and some of them are contradictory to

each other such as respect for sovereignty vs intervention. In

addition to contradicting norms, some norms are promoted but not

actually exercised by the promoting nations so China does not

really have a good example to follow in terms of socializing

norms. For example, generally speaking there is a worldwide

agreement over the use and proliferation of nuclear and chemical

weapons. Regardless, of this norm, countries such as North Korea

and Iran are actively trying to acquire nuclear weapons.

If socialization is an acceptable explanation for Chinese

multilateral behavior, China should respect the sovereignty of

its regional neighbors and adhere to ASEAN norms. Chinese leaders

should talk less about their embarrassing history and China would

be seen as more worldly.

China and ASEAN norms

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In ASEAN there is a norm of mutual respect of sovereignty

which claims to recognize the autonomy of each nation within the

multilateral body. If China adhered by this norm they would not

be trying to regain Taiwan or territories in the eastern China

seas. Instead China is heavily involved in regional conflicts

that threaten the sovereignty of its neighbors.

Although there are other ASEAN norms such as the “ASEAN way”

which a form of diplomacy that is more personal and emphasizes

compromise and collective decision making or the norm of self-

restraint, the only actual ASEAN norm to which China seems to

adhere is the non-interference norm. All of the ASEAN nations

plus China believe heavily in this principle and this norm was

only broken two times since the creation of ASEAN (1986 in the

Philippines and 1997 in Cambodia).9 China is specifically very

avid about following this norm but is more flexible in its

adherence to other regional and international norms.

Emphasis on International Image

If China was truly socializing its government couldn’t just

claim to accept international norms and practices, but

international sentiment and acceptance of these norms would be

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generated and promoted by the citizens and leaders of the nation.

China may agree to multilateral treaties and join institutions

that contain aspects of international norms but this happens

because China wishes to be conveyed as a generally responsible

member of the currently integrated international society and it

wants to protect its international image. China, by joining

international institutions and constraining itself, is showing

the world that it is capable of abiding by the rules of a

globalized international society. The protection of its

international image is of great importance because is one of the

driving factors that leads to attraction of foreign business and

investments. A positive international image is therefore not only

helpful in improving the image of the current leadership and the

country as a whole, but it also serves a greater economic

purpose. This means that China “following” these norms is

important in maintaining a positive international image and

appearing to be “socialized” can be used as a mechanism to

achieve and materialize a nation’s foreign policy goals. States

that respect China and believe in its ability to rise peacefully

are more willing to work with it and will give it more

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flexibility and control economically. This is why even though

there are constructivist reasons that lead China to

multilateralization, these constructivist factors are almost

always backed by economic attributes.

The fact that we cannot deny is that even though China wants

this international image

9Michael Leifer, 'The ASEAN Peace Process: A Category Mistake', Pacific Review

12:1 (1999), 35-36.

and may appear to be socialized, many current Chinese leaders

reject socialization and do not agree to the some of the norms.

Xi Jinping, the current leader of China is still very anti-

western and almost xenophobic still. He openly supports bloggers

and politicians that use a lot of anti-Western rhetoric. Edward

Wong, explains, that there is still a lot of hostility in China

and “state-run newspapers have taken to blaming ‘hostile foreign

forces’ for any major disturbance, whether it is ethnic violence

in western China or student-led pro-democracy demonstrations in

Hong Kong.”10 A lot of ‘unsocialized’ anti-western leaders are

the decision makers for the entire country and have considerable

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influence on the media and the perception of these norms and

foreign influences. The Chinese people that do work in

multilateral institutions and who are becoming socialized are

relatively weak in comparison to the Politburo and Chinese

government. They have very little relative influence.

History and National Myths

If socialization is valid then you should see

leaders in China absorbing the common values and becoming more

“worldly” and socialization should take away many of the effects

of national myths but these myths are still very prevalent.

Instead, China maintains its own identity and does not try to be

part of a globally socialized identity. In fact, Xi Jinping often

uses rhetoric that has roots from the era of Mao Zedong. If China

was socializing or intends to socialize then we would see the

dissolution of China’s anti-western sentiment. It is true that

some Chinese scholars have westernized but political leaders in

China still appear to fear the West

because of its imperialistic history. For example, Cheng Xinping,

a propaganda deputy head in the Hunan province describes

constitutional democracy as “an attempt to negate the party’s

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10Edward Wong, “In New China, ‘Hostile’ West Is Still Derided,” New York Times, Nov. 11, 2014, http://www.nytimes.com/2014/11/12/world/asia/china-turns-up-the-rhetoric-against-the-west.html?_r=0

leadership” and says that human rights advocates want,

“ultimately to form a force for political confrontation.”11 This

is just one propaganda leader’s words but many other Chinese

leaders express similar sentiments. Because of this continued

fear and the fact that China is socializing with economic

intentions, socialization is a weakest of the explanations for

the multilateralism of China.

Liberal Economic Theory as an Explanation

The third and strongest explanation is a liberal

economic theory. China has grown remarkably in the past few

decades in terms of economics. “Since the beginning of the

economic reform in the late 1970s through the decades after,

China has constantly sought material and technological benefits

through its participation in international organizations,

attaining asymmetric gains whenever possible”12 Globalization and

its introduction into multilateral agreements has been extremely

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instrumental in its economic rise. This strategy has indeed

worked. China since the 1990s has generally seen double digit

growth in their yearly calculations of GDP. They have become one

of the leading nations in the international market. Projections

for the future are even better. Some scholars even suggest that

China will surpass the United States and become the world’s

greatest economic power in the near future. China, along with

many other nations in the international system, see membership in

international institutions and participation in multilateral

agreements as a great opportunity to free ride. China, as a

passive member in international instructions, can reap the

benefits without actually contributing much.

If this theory is accurate in explaining the multilateralization

of China we will see economic

11Chris Buckley, “China Takes Aim at Western Ideas,” New York Times, Aug. 19, 2013, 12Guoguang Wu and Helen Lansdowne. China Turns to Multilateralism (New York, New York: Routledge, 2008) pp. 9growth as a main motive behind multilateral diplomacy. We should

also see China joining and constructing agreements and

institutions that enhance its material wealth. China will only

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join those multilateral institutions in which there is a high net

benefit.

Liberal Economic Theory Applied to ASEAN

China has a dozen trade agreements in the region, of which

only one is multilateral. That regional trade agreement is the

China-ASEAN FTA. In order for China to protect its assets and to

gain more benefits from trade, it must maintain relatively good

relationships with its trading partners which includes members of

regional groups such as, Association of Southeast Asian Nations.

The Ministry of Foreign Affairs of the People’s Republic of China

explains that, “in the political field, the two sides maintain

frequent high level dialogues and exchange of visits at all

levels.”13 For the most part these visits and dialogues have

functioned smoothly.

Although China-ASEAN cooperation began as a political

partnership to promote trust and good regional behavior, it has

expanded to include economic aspects. China originally began to

work with ASEAN because of a policy that called for “mulin

zhengce” or “good-neighborliness.” Since then, bilateral trade in

the region has grown steadily. In fact, “ASEAN is now an

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important market for labor services and project contracting by

China.” 14 The Ministry of Commerce of the PRC reported in May

2010 that China’s trade with the 26 countries in its region

reached 458.347 billion USD or approximately 32.5% of Chinese

trade.15 In 2013, the Chinese Vice Minister of Commerce announced

at a press conference, a prediction that Chinese-ASEAN trade in

2015 will rise to 500 billion dollars.16

13Ministry of Foreign Affairs, the People’s Republic of China “China and ASEAN: partnership of good neighborliness and mutual trust (Chaoyangmen Nandajie, Chaoyang District, Beijing) pp.114 Ministry of Foreign Affairs, the People’s Republic of China pp.115 Ministry of Commerce “Trade with Countries and Regions in Asia (2010/01-04)”, the People’s Republic of China 16 Xu Rui, “China-ASEAN Trade to Hit 500 Bln USD”, Xinhua (July 24 2013) pp.1

The most surprising part about this is that China put in a

lot of effort to make it happen. It was China, not ASEAN who

pushed for the adaption of the free trade agreement. China was

content with creating a regional trade agreement in this case

because it wanted to create a friendlier environment in the

region and it had finally found something that it had in common

with its regional neighbors: economic advancement.

China-ASEAN Conflicts

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There have been many positives in the past for China and

ASEAN but recently the road has been a little bit rocky and some

people are even worried or the future of these relations. Because

there are six different nations that claim to won oil-rich areas

in the South China Sea, it makes it extremely difficult to settle

political disputes. In May 2011 Chinese patrol ships not only,

cut a Vietnamese research cable but they also crashed into a

Vietnamese energy exploration vessel.17 These incidents furthered

hostility between the two nations and led to protests on both

sides but neither nation allowed the situation to escalate to a

military conflict. China also was accused of, “firing on a

Filipino vessel, attacking a number of fishing trawlers, and

violating the country’s nautical exclusion zone.”18 For ASEAN

nations, these two incidents are examples of Chinese

assertiveness in the region and similar incidents will be harder

to de-escalate.

It is crucial to regional stability and economic

enhancement, for the region to maintain a positive relationship.

The multitude of maritime conflicts in the South China Sea are

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proof that there are still some serious issues but China tends to

downplay these issues and tries to focus

17Stephanie Kleine-Ahlbrandt, “Rocky Times Ahead in South China Sea” for International Crisis Group (July 5, 2011) pp. 118Ahlbrandt pp. 1more on the economic aspects of the China-Southeast Asian

relations, and specifically tries to maintain a high level of

friendliness with ASEAN. This proves that China is working with

them for mostly economic reasons and will ignore issues that do

not affect their economy and wealth.

Liberal Economic Theory Applied to China-Japan-Korea FTA

The Center for Economic Policy Research (CEPR) also tells us

that China has started negotiations for other multilateral RTAs.

One Multilateral regional trade agreement started in August 2013

between China, Japan and South Korea. These nations also hope to

create a free trade agreement between them. Historical legacies

have caused political tensions between the three nations and it

seems that they have reached a low point in public opinion about

each other but it seems that the economic incentives that are

offered in a free trade agreement are more important to them than

political tensions over war history. On March 05, 2014 China,

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Japan and South Korea started their fourth round of talks

regarding the trilateral FTA. According to Xinhua, that round of

FTA negotiations mainly focused on “modalities of tariff

reduction, the way of opening service trade, investment and

certain range and fields of the agreement.”18 The fact that China

is willing to ignore the political differences and historical

embarrassment shows that China sees engaging in multilateral

diplomacy a key part in improving their economy. Even if the

circumstances worsen between these nations, the progress that we

have seen so far for this FTA is evidence that supports the

liberal economic theory of multilateralism.

Liberal Economic Theory Applied to RCEP FTA

A third regional trade agreement that is currently under

consideration, was incepted in November 2011. The Regional

Comprehensive Economic Partnership or RCEP is a proposal to

18 Shannon Tiezzi, “China-Japan-South Korea Hold FTA Talks Despite Political Tension,” The Diplomat, March 05, 2014 pp. 1create a free trade agreement that includes a total of 16 nations

in the region, making it one of the largest proposed free-trade

bloc in the world. RCEP is supposed to be comprised of all ten

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nations in ASEAN as well as China, Japan, South Korea, New

Zealand, Australia and India. According to Murray Hiebert, a

writer for the Center for Strategic and International Studies,

The RCEP, “includes more than 3 billion people, has a combined

GDP of about $17 trillion, and accounts for about 40 percent of

world trade.”19 This free trade agreement could do wonders for

stability and cooperation within the region. Although, this

agreement is designed to enhance the economies of all nations it

is not extremely constraining. This FTA is expected to obtain

only the bare minimum of cooperation and trade liberalization.

Hiebert describes that, for the members of the RCEP FTA this,

“numerous flexibility caveats ensure that no member has to adopt

trade policies with which it disagrees, and it protects sensitive

industries from exposure to enhanced competition.”20 Again, China

has agreed to engage in talks about this multilateral agreement

because it only requires limited engagement and does not

completely bind China. It is safe to say that if RPEC demanded

complete engagement and compliance from China would most likely

not be a part of the free trade agreement.

Liberal Economic Theory Applied to TPP FTA

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Although, China has not begun any negotiations on this next

free trade agreement, it has taken it into consideration. China

has yet to start a joint feasibility study on a China-Trans-

Pacific Partnership Free Trade Agreement. The United States has

intentions to start negotiations on a possible TPP FTA but China

has yet to be a part of these negotiations. Ryan Burkhart, a

contributor to the diplomatic courier, tells us that, “Both the

U.S. and China have goals and

19, 20 Murray Hiebert, “ASEAN and Partners Launch Regional Comprehensive Economic Partnership,”Center for Strategic & International Studies Dec 07, 2014 pp. 1objectives that will prevent China from joining the TPP in the

short term, but both countries should strive for further trade

liberalization and economic integration.” 21 China’s struggle with

joining these negotiations focus on the fact that this FTA would

be largely influenced by the United States and would contain

aspects that benefit American companies and the American

government. It is also noted that Chinese officials originally

rejected this proposal because of impressions that the United

States will try and use the Trans-Pacific Partnership FTA to try

and contain China, slow down their rise and influence policy

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regarding their territories. China no longer rejects the TPP and

many scholars still believe that China should be involved in the

next round of talks involving this FTA and should ultimately

prepare itself to be a part of the TPP or a similar agreement

that involves the United States. If economics are the main focus

of China’s foreign policy, I expect to see China being involved

in future talks regarding this FTA.

Future of Chinese Regional Free Trade Agreements

According to John Whalley and Chunding Li, the writers for

The Center for Economic Policy Research, “By including all of

China’s major trading partners in regional trade agreements and

with an average current tariff of 10% to be reduced to zero, the

medium term impact of the RTA strategy could be substantial as a

one off increment to trade growth.”22 Therefore, it is clearly in

China’s best economical interest to pursue each and all of these

negotiated or considered regional free trade agreements.

These regional trade agreements also help to show the good

will of China and shows that it wants to cooperate with other

powers in the system. According to Xi Jinping’s address at the

Walls 31

Central Foreign Affairs Work Conference of the Chinese Communist

Party in 2014, it appears

21Ryan Burkhart, “The U.S., China, and the Trans Pacific Partnership,” The Diplomatic Courier, Nov 01, 201322 John Whalley, Chunding Li, “China’s Regional and Bilateral Trade Agreements,” Center for Economic Policy Research, March 05, 2014 pp. 1

“China will continue to follow the path of “peaceful

development,” or the notion that Beijing’s neighbors and other

major partners may rest easy that China’s rise can only be

accomplished by peaceful means and will only be pursued with an

eye toward achieving “win-win” outcomes for all concerned.”23

Also, Xi Jinping’s open confirmation of the continuation of the

“period of strategic opportunity” or in other word, its

commitment to being a benign regional power, has shown that it

does not have any disruptive goals in terms of foreign policy and

its extreme focus on regional trade and other economic agreements

show that it is more focused on its internal economic level.

Liberal Economic Theory Applied to AIIB

The AIIB, or Asian Infrastructure Investment Bank, is

described by the organization as, multilateral development bank

Walls 32

(MDB). This multilateral institution was initiated in October

2013 by Xi Jinping and Le Keqiang and is attempting to “promote

interconnectivity and economic integration in the region’ and

‘cooperate with existing multilateral development banks.”24 In

2014 a memorandum was signed to establish the AIIB and is

projected to be fully established by the end of this year. The

organization states that “the Bank’s openness and inclusiveness

reflect its multilateral nature” and the “AIIB welcomes all

regional and non-regional countries, developing and developed

countries, that seek to contribute to Asian infrastructure

development and regional connectivity.”25 China has been looking

to erect an institution such as the AIIB, instead of joining a

pre-established one, like it did with the WTO. Being a founder of

the institution, it has been able to shape the rules of agreement

and the regulations. This bank is

23 Christopher K. Johnson, “Thoughts from the Chairman: Xi Jinping Unveils hisForeign Policy Vision,” Center for Strategic & International Studies, Dec 09, 2014 pp.124,25The Asian Infrastructure Investment Bank, “About Us” (Accessed April 30, 2015); available from http://www.aiibank.org/html/aboutus/AIIB/

Walls 33

important to China because it will help improve infrastructure

and production in the region, which ultimately leads to economic

benefits to China.

It is evident that China does better in multilateral

organizations that focus on the economy rather they those that

focus on security. For example, China has been very compliant and

cooperative within the World Trade Organization. The reason for

this is that the WTO has given China better access to foreign

markets and has enhanced their trade to the point of surplus.

China will perhaps show even greater cooperation within the AIIB.

Summary of Limits to Multilateralism

Limits to Economic Commitments

There are some limits to China’s economic commitments. For

instance, China seeks first and foremost to enhance their

economic gains. I predict that if China is mainly interested in

advancing their economy and retaining economic power it will

avoid generating or enhancing conflicts with nations that are

substantial to Chinese economic success such as trade wars or

even actual wars. Although their financial gains are important,

China would not agree to something economical enhancing if it

Walls 34

also threatened their territorial claims or their security. China

will work with ASEAN to produce policy that is beneficial to them

but anything that is less than beneficial will not have their

approval.

Also, China’s commitments to the multilateral arrangements

it has made in the East-Asia Pacific region are not highly

institutionalized or formal. Hongying Wang26, a professor of

political science at the University of Waterloo, uses a

comparison between the organizations of

26 Wang pp. 480-81

the European Union and the Asian-Pacific Economic Cooperation

forum. The European Union is

focused on achieving common goals and integrating its members

into binding system and they even have to make a commitment to

the Euro. Current China would never participate in such a system.

APEC is a little different. The forum only lightly binds its

members and sets its hopes for limited cooperation instead of

full scale compliance. This is why China is able to be a part of

Walls 35

such a multilateral organization and partakes in multilateral

arrangements with similar flexible

qualities.

External Limitations of Multilateralism

yeconomic foreign policy goals, countries in the region are

actually beginning to resort to other nations. Phuong Nguyen

describes that in Laos, “Shifts in geopolitical and regional

economic trends in recent years have led the Lao government,

which traditionally turned to Beijing or Hanoi for support, to

explore opportunities to engage new partners and tap into the

United States’ renewed attention to the region.” 27 If the United

States decides to help support Laos, which it is in their best

interest to do, this will cause conflict with China because China

has been trying to establish dominance in Laos and was hoping to

use them to gain economically. China as of 2013 was considered

Laos’ largest foreign investor which led to growth in both

nations. Laos’ turn to the United States is less about the

Chinese motivations and more about renewed American attention in

the region and a large push from the United States. This can

affect the Chinese view of multilateralism because this action

Walls 36

could be interpreted as an attempt to dilute Chinese influence in

the region or to constrain China. The United States and China

struggle for

27 Phuong Nguyen “In Laos, s Strategic Opening the United States Cannot Miss,”Center for Strategic & International Studies Vo. 6, Issue 7 (2015) pp. 1

influence in Laos is just one example of the limits to Chinese

multilateralism. This time the limit is not an internal one but

an external one. In general, foreign nations can work as a

limitation to China in achieving its international economic goals

by influencing nations in the region to work with them instead or

simply suggesting that they do not work with China but for the

most part, as we see with the FTAs and the AIIB, most neighboring

nations are still very willing and excited to work economically

with China.

Regional Disputes as a Limitation of Multilateralism

Large disputes in the South China Sea have important

implications for the future of China and ASEAN relations as well

as all of China’s regional economic agreements. The concern of an

escalated conflict is present in the region and nations are

concerned about the intent of China to use force to resolve the

Walls 37

issue. Although, Chinese leaders often use aggressive rhetoric,

is doubtful that China will use force because this will cause

hostility which will then strain their economic ties. Even though

the organization sometimes disagrees on dispute resolution

regarding the South China Sea, they are able to recognize that

China has serious security concerns. The issue of the South China

Sea is the main reason for the numerical increase in disputes in

ASEAN. If the liberal economic theory proves to be true, as I

expect, China will hesitate to initiate or escalate military

conflict in the region. Instead, they will try to find other

means to resolving the issues regarding the South China Sea and

other important territorial problems in Southeast Asia. In my

view, China has indeed hesitated in escalating into military

conflict. China is quickly increasing its military power and

sometimes uses military power as a threat to its neighbors but it

is unlikely that they will use force, because of (1) the fact

that its agreements with ASEAN prohibits it and (2) military

conflict in the region can escalate and drag other nations with

security commitments, i.e. the United States, into it.

Walls 38

When ASEAN failed to generate a joint-communiqué in 2012 it

was evident that there were issues in the region and this has

since deteriorated the image of ASEAN as a means of resolving

regional problems. Still, China will continue to rise and work

with ASEAN. In Perspectives on the South China Sea the authors explain

that, “China seems not likely to change its long-term policy of

having good relations with Southeast Asian countries, or at least

with most of them. China will continue to develop its economic,

diplomatic, and social-cultural relations with Southeast

Asia...The region is of most symbolic economic and diplomatic

importance to China.”28 This is evidence that China's overall

goal in the region is to influence economic and diplomatic

relations, rather than a strategic goal of regional power or

cultural influence.

China’s Image as a Limit to Multilateralism

As stated in the socialization theory, China wants to have a

positive image so that it can create economically beneficial

relations with other nations. In reality it is struggling to

create or maintain a positive international image. One of the

reasons for this is because China is a huge nation, of many

Walls 39

people with many different people and different ideas of how they

want China to be portrayed in the world. David Shambaugh, in

Coping with a Conflicted China, explains that, “China remains a deeply

conflicted rising power with a series of competing international

identities. Many new voices and actors are now part of an

unprecedentedly complex foreign-policymaking process.

Consequently, China’s foreign policy often exhibits diverse and

contradictory emphases.”29 The different faces that China shows

in foreign policy talks makes it difficult for other nations to

understand and work with China and can present a serious

challenge

28Chu Shulong in Perspectives on the South China Sea for the CSIS Edited by Murray Hiebert Phuong, Nguyen Gregory, B.Poling (Lanham, MD: Rowman & Littlefield) Sept 201429David Shambaugh, “Coping With a Conflicted China,” The Washington Quarterly, Vo. 34, Issue No. 1 (London, UK: Routledge) 2011to the multilateralization of China.

Structural Constraints as Limitations of Multilateralism

Another limit to the multilateralism of China, especially in

its region is the structural constraints of China itself. China

is a communist nation that does not do very well when it comes to

transparency. This extreme lack of transparency can cause fear to

Walls 40

neighboring nations as it does too many other countries in the

worlds. Not knowing the full extent to China’s capabilities

and intent is offsetting to the international community. It can

arouse great suspicion. Although this a limit to the amount of

trust between the nations in the region, multilateralism may be

able to help with this. As long as the multilateral institutions

demand transparency from China, it will help them feel secure.

So, if China wants to protect its economic interests it will use

regional multilateral arrangements to reduce suspicions and to

convince its neighbors that it is not malicious.

In conclusion, China has come transitioned from a period of

multilateral contention and persistence on maintaining only

bilateral relations, to a situation in which they were hesitant

and did not prefer multilateral institutions, and finally to the

current period where China is an active member in the

international community and in multilateral arrangements. It is

one hundred percent true and evident that China has engaged in

multilateral diplomacy and there is evidence that proves that

China will continue to do so. China’s participation in

multilateral institutions has been accompanied by and empowered

Walls 41

by a dramatic change in their world view. For many years China

was resistant to joining the international community due to a

fear that they were solely being used by westerners as a means to

constrain China. This pessimistic view later changed to a

cautious view when it first begun to participate in multilateral

arrangements. Finally, as we see today, China has adopted an

optimistic view towards multilateralism.

Although, China has many foreign policy goals and perhaps

has many different reasons for wanting to join multilateral

institutions, economic motives are by far the most obvious and

understood. Multilateral institutions can be used strategically

by China to push economic policies that benefit them the most.

China is aware that by being a member of these multilateral

institutions gives them a voice in the important regional

matters. It is also a benefit to China to try and erect new

multilateral institutions so they can choose the framework and

rules and regulations. Historically, China was a prime advocator

of bilateral trade but as times have changed and the world is

becoming ever more interconnected and globalized, China

understands that multilateralism works and will most likely

Walls 42

continue to work for them in the future as long as they are

committed and try to maintain friendly relations between their

neighbors and themselves. The present may be a little bit rocky

in regards to the number of current disputes in the area, but it

appears that China will not allow these problems to expand into

the economic arena. Instead it appears that China is actually

willing to push these problems aside in order to maintain

positive economic relations and develop further. China appears to

be enthusiastic about the present and future material gains of

multilateral agreements and is currently in negotiations to

expand its influence in the region by forming new regional trade

agreements. As long as China wishes to financially improve and

increase its soft power, which I’m sure it will always, we can

predict that China will continue to be involved in multilateral

agreements. The means by which China will do this can change but

as of now China is taking part of multilateral diplomacy by

creating more regional trade agreements and will continue talks

in order to create more free trade agreements.

Walls 43

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