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Background Brief Southeast Asia: Chinese Premier Charms ASEAN Carlyle A. Thayer October 10, 2013

[client name deleted] With more having happened here in Brunei, we wanted to follow up and seek your additional assessment on a couple issues. --We requested your assessment mainly on the United States, but China has continued to make the most of its summit appearances, with Premier Li Keqiang taking a stab at charming ASEAN yesterday. Beijing seems to be taking the tack of dangling its trade, possibly to defuse any disquiet over its rise. What’s the end game here? --How effective do you think this strategy will be – especially with Europe/US not always the most stable of economic partners? --It is tempting to read this as some pivotal moment when China really stepped it up in terms of showing its clout (or potential clout). Regardless of whether US decline is oversold, what do you see in the events of this week in terms of China’s rise? ANSWER: Premier Li Keqiang’s remarks on the South China Sea represent something old and something new. What is new is the positive almost conciliatory tone of his remarks. China is now pushing for joint development. This was raised by Foreign Minister Wang Yi during his visit to Vietnam in early August. China has not yet specified where joint development is to take place. One ASEAN ambassador told me that China wants ASEAN countries to recognize China’s sovereignty as a prerequisite. Once that is done China promises to shelve the sovereignty issue in order to engage in joint development. Premier Li missed the opportunity to clarify ambiguity in the Chinese proposal for joint development. Premier Li statement on freedom of navigation does not mention the actions by Chinese civil authorities, and occasionally military authorities, in intimidating fishermen and supply ships from the Philippines and Vietnam operating in waters that they claim or on the high seas inside the South China Sea. On Premier Li’s stress on the importance of the Declaration on Conduct of Parties in the South Chins Sea (DOC), he neglected to note that only four joint working groups have been set up. The DOC also calls for cooperation in safety of navigation and communication at sea. This is a sensitive area for China because of the behaviour of

2 its civilian enforcement vessels. To be consistent China should agree to a fifth working group on safety of navigation and communication at sea. China should not be able to pick and choose which elements of the DOC it will support. Premier Li’s remarks on the Code of Conduct in the South China Sea (COC) merely repeat what has already been said, that the consultations on the COC will be held under the framework of implementing the DOC. ASEAN would like this matter to be dealt with at senior official level. Premier Li made no response to the request by ASEAN leaders at their last summit. Premier Li’s remarks about working to advance the COC “in an active and prudent manner under the principle of consensus building” means that China will use consensus building to slow the consultation process down and to veto any proposal it does not agree with. China is seeking to separate and contain the South China Sea issues from spoiling China-ASEAN relations in general, and economic relations in particular. China hopes to lure ASEAN countries into cooperation on economic issue in the hopes that they will not press the South China Sea COC too hard. China needs to explain its position in more detail. And it needs to raise the consultations on the COC to senior official level.

Suggested citation: Carlyle A. Thayer, “Southeast Asia: Chinese Premier Charms ASEAN,” Thayer Consultancy Background Brief, October 10, 2013. All background briefs are posted on (search for Thayer). To remove yourself from the mailing list type UNSUBSCRIBE in the Subject heading and hit the Reply key. Thayer Consultancy provides political analysis of current regional security issues and other research support to selected clients. Thayer Consultancy was officially registered as a small business in Australia in 2002.

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