China’s Free Trade Area Strategy: An alternative avenue to China’s “peaceful” rise?

ABSTRACT

China’s Free Trade Area strategy and its global network of free trade areas are providing new impetus to its rise at systemic (global) and sub-systemic (regional) levels. The research objectives of the paper are to explore China’s Free Trade Area strategy and its motivations and methods. It contributes to the scholarly discussion by analyzing China’s Free Trade Area strategy in the greater picture of China’s rise in the global power hierarchy and examining its global network of free trade areas in a comprehensive way. The paper finds that China’s free trade areas provide a convenient path to increasing economic cooperation and trade between China and its partners. China is able to obtain growing benefits from its free trade areas by intensifying economic, and by extension, political relations with its global partners and create an environment conducive to its peaceful rise. The paper concludes that given the enormous benefits, China’s partners gradually accept its concept of “peaceful rise” by viewing its rise as an “opportunity” for their growth. In this sense, China’s Free Trade Area strategy and its network of free trade areas may help China reap not only economic but also geopolitical interest.

KEYWORDS:

• Free Trade Area strategy
• China’s global network of free trade areas
• Economic diplomacy
• Economic and political interests
• Peaceful rise

Notes

¹ Chinese scholars and economists argue that the advanced nations, particularly the United States and EU, have tacitly adopted a strategy to exclude China from their free trade area networks, or in the Chinese phrase, an “ABC” strategy (they may conclude free trade agreements with all but China). In their views, the ABC strategy is designed to perpetuate the predominance of the EU and the United States in the world trade and economics. They tend to validate their argument by pointing to the US-dominated TPP that excludes China whereas incorporating Vietnam whose economy is widely perceived as far less open than China’s. For more details, see Song, Guoyou 2013, ‘quanqiu ziyou maoyi xieding jingzheng yu zhongguo de zhanlue xuanze (Global Free Trade Area competition and China’s strategic choice), Contemporary International Relations, No. 5, pp. 30-35; Liu, Qing 2012, ‘meiyue guanxi xin fazhan ji qianjing (the new development of the US–Vietnam relationship and its prospect)’, International Studies, No. 2, pp. 90–99.

² Between the spring and summer of 1949, Mao Zedong advanced the principle of “leaning to one side”. The official Chinese IR literature believes that this is a major decision made in the light of China’s historical and realistic situation and in accordance with the existing international environment at that time. The strategy of “leaning one side” is to declare that China would lean to the side of socialism as during the Chinese civil war the US stood on the opposite side of the Chinese Communist Party and supported the Kuomintang. After the birth of New China, the US might carry out armed intervention against China. Thus the above-mentioned situation necessitated China’s allying with the socialist countries. For more details, see Ministry of Foreign Affairs of the PRC 2015, Formulation of foreign policy of new China on the eve of its birth, FMPRC, Beijing, viewed 7 May 2015, <http://www.fmprc.gov.cn/mfa_eng/ziliao_665539/3602_665543/3604_665547/t18057.shtml%62.

³ The mainstream perceptions of Chinese academics on China’s involvement in the Korean War are radically different from those of the West. Many Chinese scholars characterize China’s involvement in the war as inevitable. They argue that China’s involvement was not merely a logical outcome of the Communist ideology that Mao Zedong upheld, but was more related to China’s geopolitical interests, territorial security and economic rehabilitation from its long-term wars. In their eyes, after the US-headed UN forces crossed the 38th parallel into North Korea and quickly pushed forward towards the Chinese border, Mao Zedong was left with only one option: to roll back the UN forces to the 38th parallel by sending troops to North Korea. For more details, see Qin, Xiaofan 2010, ‘Mao Zedong yu zhong guo kang mei yuan chao jue ce (Mao Zedong and China’s decision on the war to resist American aggression and aid Korea), Foreign Affairs Review, Vol. 31, No.1, pp.4-10; Sha, Jiansun 2010, ‘Kang mei yuan chao zhan zhen ji qi li shi yi yi (The war of resisting American aggression and aiding Korea and its historic meaning)’, Journal of Ideological & Theoretical Education, Vol. 139, No.7, p.33–37.

⁴ ‘Peaceful evolution’ is a term generally used by Chinese academics to describe an alleged strategy of the United States and its Western allies to either overthrow or Westernize socialist states, including China, through peaceful means if or when they fail to achieve the same goal through economic embargoes, military interference or outright invasions. For an elaboration on this term, see Zhao Fuke 2009, ‘Mao Zedong Deng Xiaoping fangzhi he fandui heping yanbian de lilun yu shijian shuxi’ (On the theories and practices of Mao Zedong and Deng Xiaoping for preventing and combating peaceful evolution), Journal of Jiangxi Normal University, Vol. 42, No. 2, pp. 110–114.

⁵ Since then the term ‘economic diplomacy’ (jingji waijiao) has been part of the Chinese diplomatic vocabulary to describe the employment of both the official (Track 1) and unofficial (Track 2) channels of diplomacy for advancing China’s economic development through various means, such as gaining access to foreign markets as well as the use of trade, investment and finance in support of China’s diplomatic goals. Currently, the three main objectives of this ‘economic diplomacy’ are (1) strengthening China’s economic relationship with the developing countries, as demonstrated by China’s increasing involvement in Africa and South America; (2) attaining China’s diplomatic objectives, i.e. China’s increasingly proactive role in G20; and (3) diversifying China’s export markets and sources of energy and raw materials. More details see Khan, Shamsul and Yu, Lei 2013, “Evolving China–ASEAN Relations and China–ASEAN Free Trade Area: Chinese Perspectives on China’s Initiatives in Relation to ASEAN Plus 1”, European Journal of East Asia Studies, Vol. 12, No. 1, p. 81.