Special Analysis: February 17, 2010

© 2010: ISSA Indo-Pacific Pty. Ltd.

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The US-PRC Strategic Divide Begins

Analysis. Staff Report. The simmering difficulties in the US strategic relationship with the People’s Republic of China (PRC) were, by the beginning of 2010, ready to emerge despite the attempts of the US Administration of Pres. Barack Obama to show a pattern of deference to Beijing. But the internal US economic policies, leading to the de facto devaluation of the US dollar, seemed, if anything, a deliberate move to devalue the worth of the PRC’s massive investments in US dollar instruments.

All that was needed to cause Beijing to vent its frustrations with the US — quite apart from major differences over the demand for Beijing to make economic and social investments in redressing alleged “climate change” — were additional seeming insults to the PRC’s sovereignty and pride. US allegations that the PRC Government was censoring the Google online search engine in China — which evidence indicates was the case — highlighted the sensitivity of Beijing which collectively recognizes (a) the potential of the electronic media to cause social unrest, and (b) the delicacy of the PRC to any social and economic unrest occurring in the near future.

The most significant pretext, however, was the US decision to move ahead with its $6.4-billion defense equipment sales package to the Republic of China (ROC: Taiwan), which was announced by the US Defense Department on January 29, 2010. Given historical precedent, Beijing had no option but to react negatively to the sale, and hoped its early threats of damage to US-PRC relations would sway the now left-leaning US Congress to refuse sanction for the sale, an unlikely occurrence, but one which had a 30-day window of opportunity, the time during which Congress can veto an Administration foreign military sale after it has been proposed.

Perhaps most importantly, however, the incident gave Beijing the long-awaited opportunity to break completely with the US-led packages of measures on trade, economic approaches, and “climate change” accords, which were perceived as being highly detrimental to the PRC’s need to control its domestic agenda and the foreign resources acquisitions needed to support it. Thus, competition between the PRC and the West in Africa, the Middle East, and Central Asia (not to mention East Asia) will intensify with less regard for niceties.

This will, Defense & Foreign Affairs analysts believe, lead to the more rapid coalescing of new strategic blocs, some of which will be expedient and temporary, including the Russo-Chinese alliance using the Shanghai Cooperation Organization (SCO) as a basis. Within this framework, the PRC will pursue its fundamental and long-term alliance relationships with Pakistan and Myanmar, and in both these countries the development of communications infrastructure linking the PRC with the Indian Ocean can be expected to take precedence. Indeed, the PRC will need to move quickly to ensure that it continues to exert strong influence over the Myanmar Government after the late-2010 elections which could see the military leadership out of the national leadership.

The PRC will attempt to further demonstrate that its strategic relationship with the Iranian Government is separate and equal to the Russo-Iranian relationship, but more friendly to Tehran than Moscow. But there is no escaping Beijing’s need to remain close with Moscow in order to access all of the pipelines linking it through Central Asia to Iran, and then on through Turkey to Europe.

US media speculation that the PRC would support, or not interfere with, a new US-led sanctions regime against Iran — over Iran’s continued pursuit of an indigenous nuclear weapons program — are, according to Defense & Foreign Affairs analysts, naďve. Firstly, the PRC is, with Russia, the major facilitator of trade access to and from Iran and neither will jeopardize its influence with Tehran and the benefits derived therefrom. That would be akin to suggesting that the Great Game for control of Central Asia and Persia had not just been won by Russia and its allies (in this case, the PRC).

This leads inevitably to the reality that Iran will — with US sensibilities now less of an issue in Beijing or Moscow — be invited to become a full member of the SCO, with the implied military protection of Iran from external attack (“an attack on one is an attack on all”), either formally or de facto.

Most significantly, the changing trends mean that the PRC will no longer have to mask its growing interest in the Indian Ocean and its intention to compete there with the US as well as India. The PRC in January 2010 made it clear that it needed what could be called “temporary home porting” in Gwadar, the Pakistani port being developed by the PRC, of its PLA Navy vessels in the Indian Ocean so that crews could get their necessary shore-time and ships could be revictualed.

The ROC, meanwhile, has a brief respite to build relations with Washington, now that the strenuously leftist Administration of Barack Obama has been rebuffed by the state it felt was a natural ally, the PRC. But within this taut web of competition and dependencies, the US and the PRC will remain careful not to push each other too far.