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[Dehai-WN] Stratfor.com: The State of the World: Assessing China's Strategy

From: Berhane Habtemariam <Berhane.Habtemariam_at_gmx.de_at_dehai.org>
Date: Tue, 6 Mar 2012 18:17:15 +0100

The State of the World: Assessing China's Strategy

March 6, 2012 | 0016 GMT

By George Friedman

Simply put, China has three core strategic interests.

Paramount among them is the maintenance of domestic security. Historically,
when China involves itself in global trade, as it did in the 19th and early
20th centuries, the coastal region prospers, while the interior of China --
which begins about 160 kilometers (100 miles) from the coast and runs about
1,600 kilometers to the west -- languishes. Roughly 80 percent of all
Chinese citizens currently have household incomes lower than the average
household income in Bolivia. Most of China's poor are located west of the
richer coastal region. This disparity of wealth time and again has exposed
tensions between the interests of the coast and those of the interior. After
a failed rising in Shanghai in 1927, Mao Zedong exploited these tensions by
undertaking the Long March into the interior, raising a peasant army and
ultimately conquering the coastal region. He shut China off from the
international trading system, leaving China more united and equal, but
extremely poor.

The current government has sought a more wealth-friendly means of achieving
stability: buying popular loyalty with mass employment. Plans for industrial
expansion are implemented with little thought to markets or margins;
instead, maximum employment is the driving goal. Private savings are
harnessed to finance the industrial effort, leaving little domestic capital
to purchase the output. China must export accordingly.

China's second strategic concern derives from the first. China's industrial
base by design produces more than its domestic economy can consume, so China
must export goods to the rest of the world while importing raw materials.
The Chinese therefore must do everything possible to ensure international
demand for their exports. This includes a range of activities, from
investing money in the economies of consumer countries to establishing
unfettered access to global sea-lanes.

The third strategic interest is in maintaining control over buffer states.
The population of the historical Han Chinese heartland is clustered in the
eastern third of the country, where ample precipitation distinguishes it
from the much more dry and arid central and western thirds. China's physical
security therefore depends on controlling the four non-Han Chinese buffer
states that surround it: Manchuria, Inner Mongolia, Xinjiang and Tibet.
Securing these regions means China can insulate itself from Russia to the
north, any attack from the western steppes, and any attack from India or
Southeast Asia.

Controlling the buffer states provides China geographical barriers --
jungles, mountains, steppes and the Siberian wasteland -- that are difficult
to surmount and creates a defense in depth that puts any attacker at a grave

Challenged Interests

Today, China faces challenges to all three of these interests.

The economic downturn in Europe and the United States, China's two main
customers, has exposed Chinese exports to increased competition and
decreased appetite. Meanwhile, China has been unable to appropriately
increase domestic demand and guarantee access to global sea-lanes
independent of what the U.S. Navy is willing to allow.

Those same economic stresses also challenge China domestically. The
wealthier coast depends on trade that is now faltering, and the impoverished
interior requires subsidies that are difficult to provide when economic
growth is slowing substantially.

In addition, two of China's buffer regions are in flux. Elements within
Tibet and Xinjiang adamantly resist Han Chinese occupation. China
understands that the loss of these regions could pose severe threats to
China's security, particularly if such losses would draw India north of the
Himalayas or create a radical Islamic regime in Xinjiang.

The situation in Tibet is potentially the most troubling. Outright war
between India and China -- anything beyond minor skirmishes -- is impossible
so long as both are separated by the Himalayas. Neither side could
logistically sustain large-scale multi-divisional warfare in that terrain.
But China and India could threaten one another if they were to cross the
Himalayas and establish a military presence on the either side of the
mountain chain. For India, the threat would emerge if Chinese forces entered
Pakistan in large numbers. For China, the threat would occur if large
numbers of Indian troops entered Tibet.

China therefore constantly postures as if it were going to send large
numbers of forces into Pakistan, but in the end, the Pakistanis have no
interest in de facto Chinese occupation -- even if the occupation were
directed against India. Likewise, the Chinese are not interested in
undertaking security operations in Pakistan. The Indians have little
interest in sending forces into Tibet in the event of a Tibetan revolution.
For India, an independent Tibet without Chinese forces would be interesting,
but a Tibet where the Indians would have to commit significant forces would
not be. As much as the Tibetans represent a problem for China, the problem
is manageable. Tibetan insurgents might receive some minimal encouragement
and support from India, but not to a degree that would threaten Chinese

So long as the internal problems in Han China are manageable, so is Chinese
domination of the buffer states, albeit with some effort and some damage to
China's reputation abroad.

The key for China is maintaining interior stability. If this portion of Han
China destabilizes, control of the buffers becomes impossible. Maintaining
interior stability requires the transfer of resources, which in turn
requires the continued robust growth of the Chinese coastal economy to
generate the capital to transfer inland. Should exports stop flowing out and
raw materials in, incomes in the interior would quickly fall to politically
explosive levels. (China today is far from revolution, but social tensions
are increasing, and China must use its security apparatus and the People's
Liberation Army to control these tensions.)

Maintaining those flows is a considerable challenge. The very model of
employment and market share over profitability misallocates scores of
resources and breaks the normally self-regulating link between supply and
demand. One of the more disruptive results is inflation, which alternatively
raises the costs of subsidizing the interior while eroding China's
competitiveness with other low-cost global exporters.

For the Chinese, this represents a strategic challenge, a challenge that can
only be countered by increasing the profitability on Chinese economic
activity. This is nearly impossible for low value-added producers. The
solution is to begin manufacturing higher value-added products (fewer shoes,
more cars), but this necessitates a different sort of work force, one with
years more education and training than the average Chinese coastal
inhabitant, much less someone from the interior. It also requires direct
competition with the well-established economies of Japan, Germany and the
United States. This is the strategic battleground that China must attack if
it is to maintain its stability.

A Military Component

Besides the issues with its economic model, China also faces a primarily
military problem. China depends on the high seas to survive. The
configuration of the South China Sea and the East China Sea render China
relatively easy to blockade. The East China Sea is enclosed on a line from
Korea to Japan to Taiwan, with a string of islands between Japan and Taiwan.
The South China Sea is even more enclosed on a line from Taiwan to the
Philippines, and from Indonesia to Singapore. Beijing's single greatest
strategic concern is that the United States would impose a blockade on
China, not by positioning its 7th Fleet inside the two island barriers but
outside them. From there, the United States could compel China to send its
naval forces far away from the mainland to force an opening -- and encounter
U.S. warships -- and still be able to close off China's exits.

That China does not have a navy capable of challenging the United States
compounds the problem. China is still in the process of completing its first
aircraft carrier; indeed, its navy is insufficient in size and quality to
challenge the United States. But naval hardware is not China's greatest
challenge. The United States commissioned its first aircraft carrier in 1922
and has been refining both carrier aviation and battle group tactics ever
since. Developing admirals and staffs capable of commanding carrier battle
groups takes generations. Since the Chinese have never had a carrier battle
group in the first place, they have never had an admiral commanding a
carrier battle group.

China understands this problem and has chosen a different strategy to deter
a U.S. naval blockade: anti-ship missiles capable of engaging and perhaps
penetrating U.S. carrier defensive systems, along with a substantial
submarine presence. The United States has no desire to engage the Chinese at
all, but were this to change, the Chinese response would be fraught with

While China has a robust land-based missile system, a land-based missile
system is inherently vulnerable to strikes by cruise missiles, aircraft,
unmanned aerial vehicles currently in development and other types of attack.
China's ability to fight a sustained battle is limited. Moreover, a missile
strategy works only with an effective reconnaissance capability. You cannot
destroy a ship if you do not know where it is. This in turn necessitates
space-based systems able to identify U.S. ships and a tightly integrated
fire-control system. That raises the question of whether the United States
has an anti-satellite capability. We would assume that it does, and if the
United States used it, it would leave China blind.

China is therefore supplementing this strategy by acquiring port access in
countries in the Indian Ocean and outside the South China Sea box. Beijing
has plans to build ports in Myanmar, which is flirting with ending its
international isolation, and Pakistan. Beijing already has financed and
developed port access to Gwadar in Pakistan, Colombo and Hambantota in Sri
Lanka, Chittagong in Bangladesh, and it has hopes for a deepwater port at
Sittwe, Myanmar. In order for this strategy to work, China needs
transportation infrastructure linking China to the ports. This means
extensive rail and road systems. The difficulty of building this in Myanmar,
for example, should not be underestimated.

But more important, China needs to maintain political relationships that
will allow it to access the ports. Pakistan and Myanmar, for example, have a
degree of instability, and China cannot assume that cooperative governments
will always be in place in such countries. In Myanmar's case, recent
political openings could result in Naypyidaw's falling out of China's sphere
of influence. Building a port and roads and finding that a coup or an
election has created an anti-Chinese government is a possibility. Given that
this is one of China's fundamental strategic interests, Beijing cannot
simply assume that building a port will give it unrestricted access to the
port. Add to this that roads and rail lines are easily sabotaged by
guerrilla forces or destroyed by air or missile attacks.

In order for the ports on the Indian Ocean to prove useful, Beijing must be
confident in its ability to control the political situation in the host
country for a long time. That sort of extended control can only be
guaranteed by having overwhelming power available to force access to the
ports and the transportation system. It is important to bear in mind that
since the Communists took power, China has undertaken offensive military
operations infrequently -- and to undesirable results. Its invasion of Tibet
was successful, but it was met with minimal effective resistance. Its
intervention in Korea did achieve a stalemate but at horrendous cost to the
Chinese, who endured the losses but became very cautious in the future. In
1979, China attacked Vietnam but suffered a significant defeat. China has
managed to project an image of itself as a competent military force, but in
reality it has had little experience in force projection, and that
experience has not been pleasant.

Internal Security vs. Power Projection

The reason for this inexperience stems from internal security. The People's
Liberation Army (PLA) is primarily configured as a domestic security force
-- a necessity because of China's history of internal tensions. It is not a
question of whether China is currently experiencing such tensions; it is a
question of possibility. Prudent strategic planning requires building forces
to deal with worst-case situations. Having been designed for internal
security, the PLA is doctrinally and logistically disinclined toward
offensive operations. Using a force trained for security as a force for
offensive operations leads either to defeat or very painful stalemates. And
given the size of China's potential internal issues and the challenge of
occupying a country like Myanmar, let alone Pakistan, building a secondary
force of sufficient capability might not outstrip China's available manpower
but would certainly outstrip its command and logistical capabilities. The
PLA was built to control China, not to project power outward, and strategies
built around the potential need for power projection are risky at best.

It should be noted that since the 1980s the Chinese have been attempting to
transfer internal security responsibilities to the People's Armed Police,
the border forces and other internal security forces that have been expanded
and trained to deal with social instability. But despite this restructuring,
there remain enormous limitations on China's ability to project military
power on a scale sufficient to challenge the United States directly.

There is a disjuncture between the perception of China as a regional power
and the reality. China can control its interior, but its ability to control
its neighbors through military force is limited. Indeed, the fear of a
Chinese invasion of Taiwan is unfounded. It cannot mount an amphibious
assault at that distance, let alone sustain extended combat logistically.
One option China does have is surrogate guerrilla warfare in places like the
Philippines or Indonesia. The problem with such warfare is that China needs
to open sea-lanes, and guerrillas -- even guerrillas armed with anti-ship
missiles or mines -- can at best close them.

Political Solution

China therefore faces a significant strategic problem. China must base its
national security strategy on what the United States is capable of doing,
not on what Beijing seems to want at the moment. China cannot counter the
United States at sea, and its strategy of building ports in the Indian Ocean
suffers from the fact that its costs are huge and the political conditions
for access uncertain. The demands of creating a force capable of
guaranteeing access runs counter to the security requirements inside China

As long as the United States is the world's dominant naval power, China's
strategy must be the political neutralization of the United States. But
Beijing must make certain that Washington does not feel so pressured that it
chooses blockade as an option. Therefore, China must present itself as an
essential part of U.S. economic life. But the United States does not
necessarily see China's economic activity as beneficial, and it is unclear
whether China can maintain its unique position with the United States
indefinitely. Other, cheaper alternatives are available. China's official
rhetoric and hard-line stances, designed to generate nationalist support
inside the country, might be useful politically, but they strain relations
with the United States. They do not strain relations to the point of risking
military conflict, but given China's weakness, any strain is dangerous. The
Chinese feel they know how to walk the line between rhetoric and real danger
with the United States. It is still a delicate balance.

There is a perception that China is a rising regional and even global power.
It may be rising, but it is still far from solving its fundamental strategic
problems and further yet from challenging the United States. The tensions
within China's strategy are certainly debilitating, if not fatal. All of its
options have serious weaknesses. China's real strategy must be to avoid
having to make risky strategic choices. China has been fortunate for the
past 30 years being able to avoid such decisions, but Beijing utterly lacks
the tools required to reshape that environment. Considering how much of
China's world is in play right now -- Sudanese energy disputes and Myanmar's
political experimentation leap to mind -- this is essentially a policy of
blind hope.


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Received on Tue Mar 06 2012 - 12:17:42 EST
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