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    Greater China
     Jun 9, 2005
The US and that 'other' axis
By Jephraim P Gundzik

Beijing's increasingly close ties with Moscow and Tehran will thwart Washington's foreign policy goal of expanding US security footholds in the Middle East, Central Asia and Asia. However, the primacy of economic stability will most likely prevent a proxy-style military confrontation, in Iran or North Korea, between China and the US.

Threat to 'axis of evil' unwinds in Baghdad
In January 2002 during his State of the Union address to the US congress, President George W Bush outlined his administration's primary foreign policy goal as preventing "regimes that sponsor terror from threatening America or our friends and allies with weapons of mass destruction". Bush went on to specifically name Iraq, Iran and North Korea as state sponsors of terrorism, infamously dubbing this group the "axis of evil". After failing to gather multilateral support in the United Nation, Bush declared war on Iraq.

Since the beginning of the war in Iraq, Beijing has worked feverishly to strengthen its ties with Moscow and Teheran in an apparent effort to prevent US military action against the remaining "axis of evil" members, Iran and North Korea. In addition to recent massive energy deals with Teheran, which place Iran in China's security web, both Beijing and Moscow have accelerated the transfer of missile technology to Teheran, while selling the Islamic republic increasingly sophisticated military equipment.

Armed with a vast array of anti-ship and long-range missiles, Iran can target US troop positions throughout the Middle East and strike US Navy ships. Iran can also use its weapons to blockade the Straits of Hormuz through which one-third of the world's traded oil is shipped. With the help of Beijing and Moscow, Teheran is becoming an increasingly unappealing military target for the US.

As in the Middle East, the China-Iran-Russia axis is challenging US interests in Central Asia. Washington is working feverishly to gain security footholds in Tajikistan and Kazakhstan to complement existing US military bases in Afghanistan, Uzbekistan and Kyrgyzstan. China and Russia are working equally hard to assert their influence in Central Asia. A good portion of this work is being done under the auspices of the Shanghai Cooperation Organization (SCO.)

Composed of China, Russia, Uzbekistan, Tajikistan, Kazakhstan and Kyrgyzstan, the SCO was created in 1996 and reborn in 2001 when it was bolstered to counter the initial eastward expansion of the North Atlantic Treaty Organization. The SCO is becoming an increasingly powerful regional mutual security organization. Joint military maneuvers between SCO member states began in 2003. In 2004, the SCO created a rapid reaction anti-terror strike force. According to Igor Rogachev, Russia's ambassador to China, the new force is designed to combat and respond to terrorist attacks in any SCO member nation.

In 2004, Iran made it clear that it was interested in joining the SCO. Iran's mammoth energy deals with China imply that Tehran is now integral to China's national security. A good way to formalize security relations between China and Iran is through the SCO.

The autocratic governments of Central Asia have much more in common with China, Iran and Russia than with the US. At the same time, China and Russia can invest exponentially larger sums of money in Central Asian countries than the US. Almost all of China's and Russia's foreign investment is conducted by state-owned enterprises. Investment by these enterprises is primarily driven by geopolitical expediency.

Foreign investment in the US is controlled by profit-driven private enterprises. While the US government can dole out aid to Central Asian countries, the size of this aid pales in comparison to the money that can be lavished on Central Asian countries by China's and Russia's state-owned enterprises. In 2004, commercial and security ties between Kazakhstan and China were strengthened when Beijing signed a deal with Astana to build a pipeline from the Caspian Sea to western China.

The pipeline deal with Kazakhstan prompted Beijing to pledge increased military and technical assistance to Kyrgyzstan, through which this pipeline passes. Despite its small size and lack of natural resources, the geostrategic importance of Kyrgyzstan, which hosts military bases for both Russia and the US, is enormous. Recent political instability in Kyrgyzstan especially alarmed Washington.

In early April, US Secretary of Defense Donald Rumsfeld visited Bishkek to ensure that Kyrgyzstan's new government would continue to host US military forces. In addition, Rumsfeld tried to persuade interim President Kurmanbek Bakiyev to allow the US to station AWACS surveillance planes in Kyrgyzstan. At the beginning of 2005, the Kyrgyz Foreign Ministry denied this request by Washington, saying that such equipment was beyond the original humanitarian and peace-keeping mission of US. forces in Kyrgyzstan. Bakiyev made it clear that Washington would not be allowed to deploy the AWACS or to establish any more bases or expand existing facilities in Kyrgyzstan.

Bakiyev also stressed that US forces would not be in the country permanently. Deepening economic and security ties between Central Asian countries and China and Russia could eventually reduce Washington's influence in the region to Afghanistan. However, in addition to three operational military bases already in Afghanistan, Washington plans on building another six military bases, further amplifying the US military threat to China, Russia and Iran.

East Asia is another region where the China-Iran-Russia alliance has common interests diametrically opposed to Washington's. The most obvious country where these interests conflict is North Korea. As with Iran, the Bush administration is determined to force North Korea's government to acquiesce to US security demands. Again, like Iran, North Korea poses a strategic threat to Washington's global hegemonic aspirations. The mutual antagonism by Iran and North Korea of the US has naturally brought these two countries together. North Korea has been an integral supplier to Iran's ballistic missile program over the past 15 years.

The US State Department has sanctioned the Changgwang Sinyong Corporation, North Korea's main missile exporter, four times since 2000 for engaging in proliferation activities with Iran. In 2004, US intelligence reported that North Korea was helping Iran build long-range missiles. While Iran's ties to North Korea are strategic, Russia's and China's ties to the country are security driven. Both Russia and China share common borders with North Korea.

The Soviet Union had strong ties with North Korea between 1950 and 1990 punctuated by a mutual security agreement. After the breakup of the Soviet Union, Russia's relations with North Korea weakened sharply. President Boris Yeltsin chose not to renew the mutual security agreement with North Korea in favor of strengthening relations with South Korea.

President Vladimir Putin reestablished the historically close ties between Russia and North Korea. In 2000, Putin traveled to Pyongyang. North Korea's leader, Kim Jong-il, paid return visits to Russia in 2001 and 2002. In addition to official state visits, Moscow and Pyongyang have exchanged several ministry-level visits in the past two years. Pyongyang also enjoys very close relations with Beijing, with which high-level visits have been exchanged regularly in the past several years.

More importantly, Pyongyang and Beijing are tied together by a mutual security agreement. North Korea is an important security buffer for both China and Russia against US military projection in Asia. With Beijing and Moscow clearly in accord about countering Washington's global hegemonic aspirations, neither country is likely to sell out their relations with North Korea and this security buffer. More likely, Beijing and Moscow would like to bolster the security buffer in the light of expanding US militarism. It is extremely unlikely that the US will convince North Korea to give up its nuclear weapons and uranium enrichment program because both Beijing and Moscow need North Korea and the security buffer it provides.

Playing in Washington's backyard
In 2004, Russia and China launched a counter-offensive to the expansion of US militarism in Asia. Beijing and Moscow began to court Latin America's new leftist governments in an unprecedented slap to the US. Both Russia and China have strengthened relations with Washington's arch foe in Latin America - Venezuela. In November 2004, Moscow agreed to sell Caracas as many as 30 combat helicopters and 100,000 automatic rifles. In addition, Venezuela is considering the purchase of up to 50 MiG-29 fighter jets from Russia to replace aging F-16s.

The Russia-Venezuela arms deal was widely criticized in Washington. Both Secretary of Defense Donald Rumsfeld and Secretary of State Condoleezza Rice have voiced strong opposition to the deal. In late 2004, Venezuela's President Hugo Chavez visited Beijing, where he signed several oil sector investment deals with the China National Petroleum Corporation. Chavez has also stated that he would like to give oil export preference to China rather than the US. China also signed significant energy-related investment deals with Brazil, Ecuador and Argentina in 2004. The willingness of Beijing and Moscow to challenge US security so close to home clearly indicates that a geostrategic battle has begun.

Security threat or strategic competitor?
Beijing's expanding foreign relations both within and outside the China-Iran-Russia alliance and China's growing militarism have begun to repaint Washington's perceptions of US-China relations. These perceptions have been echoed by Washington's closest allies in Asia - Taipei and Tokyo. In mid-2004, reports by both the US-China Economic and Security Review Commission (USCC) and the Pentagon depicted China as a major threat to US national security.

The USCC was created by Congress in 2000 "to monitor, investigate and submit to Congress an annual report on the national security implications of the bilateral trade and economic relationship between the United States and the People's Republic of China, and to provide recommendations, where appropriate, to Congress for legislative and administrative action". In June 2004, the USCC released its annual report on China.

This report noted that China was deliberately using economic warfare against Washington by creating a "competitive advantage over US manufacturers". The report specifically referred to the undervaluation of the yuan against the dollar and Beijing's (alleged) disregard for World Trade Organization rules as weapons in China's economic war with the US. The report described China's expanding relations with Iran as countering multilateral efforts to stabilize international oil supplies and prices.

The USCC report also noted that Russia was supplying increasingly sophisticated weapons to China and that these weapons were part of Beijing's strategy for defeating US forces in the event of war with Taiwan. A congressionally mandated report on China by the Pentagon described China's Russia-assisted military buildup as giving China the ability "to cause significant damage to all of Taiwan's airfields and quickly degrade Taiwan's ground based air-defenses and associated command and control". Most alarming, the Pentagon report warned that Chinese military strategists were considering the use of nuclear weapons against US and Taiwanese forces.

The Bush administration's concern over China's growing military power is also depicted in Washington's reaction to the European Union's proposed lifting of its China arms embargo. Washington's greatest concern about renewed arms trade between the EU and China was that this trade would permanently tip the balance of power away from Taiwan and toward China. Even worse, European arms could be used to kill US troops in Asia. Of course, the possibility of Beijing using European weapons to kill US troops presupposes that a war between China and the US will erupt.

Taiwan's President Chen Shui-bian and his Democratic Progressive Party (DPP) share Washington's concerns about China's military threat. The Chen government's concern stems from its drive for Taiwan's independence from China and Beijing's forceful reminders that Taiwan is part of China. In the lead up to Taiwan's legislative elections in late 2004, Chen campaigned on a platform of Taiwanese independence. Though Chen's DPP suffered significant losses in these elections, Beijing's response was largely entrained in the form of China's anti-secession law.

The law was meant to firmly warn Chen against seeking Taiwan's independence from China in the event that the DPP won a legislative majority. The DPP's losses to the unification-minded opposition takes much of the bite out of the law. In addition, Chen's opposition, the Nationalist Party, has permanently stalled legislation seeking about $18 billion to bolster Taiwan's missile defense system. The opposition has realized that Taiwan has no hope of defending against a military attack from the mainland, prompting renewed ties between Taiwan's Nationalist Party and Beijing.

Along with Washington and Taipei, Tokyo also demonstrated its growing concern over China's increasing military might. In December 2004, the Japanese Defense Agency issued a defense policy guideline that defined China as a potential security threat. The report noted, "China, which has significant influence on the region's security, has been modernizing its nuclear and missile capabilities as well as naval and air forces, and expanding its area of operation at sea."

In a joint US-Japan security statement issued in February, Tokyo went further, agreeing that Japan would "encourage the peaceful resolution of issues concerning the Taiwan Strait through dialogue". Both the defense policy guideline and Tokyo's concern over tension between China and Taiwan are a dramatic departure from Japan's post-war foreign policy. The change in foreign policy focus from military pacifism to military assertion is being driven by Washington's own security concerns.

These same concerns drove Tokyo to encourage oil exploration in an area of the East China Sea that is claimed by China. Japan's military assertion has accelerated China's defense buildup while contributing to the creation of the China-Iran-Russia alliance. The shift in Tokyo's foreign policy has led to a sharp deterioration in China's relations with Japan. Foreign policies in Beijing, Washington and Tokyo are all characterized by two separate components - geopolitical relations and economic relations.

Cold War redux
Beijing's geopolitical relations with Washington and Tokyo are arguably at their lowest ebb since China established formal relations with the US and Japan in the 1970s. The deterioration in China's relations with the US and Japan and the resultant improvement in relations with Iran and Russia are being driven by Washington's outsized global security concerns. These security concerns are becoming a self-fulfilling prophecy for Washington.

In sharp contrast to geopolitical relations, economic relations between Beijing, Washington and Tokyo remain quite strong. The mutual interdependence of these economies argues strongly against the preeminence of security issues in overall relations. China is the largest trading partner of Japan and third largest trading partner of the US. In addition to substantial trade links, American and Japanese companies have invested tens of billions of dollars in China over the past 15 years. Nonetheless, Beijing, Washington and Tokyo have all elevated the importance of security to overall economic well-being.

While a conflict between the US and China over Iran or North Korea cannot be ruled out, economic interdependence suggests Beijing and Washington have entered a period of geopolitical detente. Beijing's increasingly close relations with Moscow and Tehran will contain Washington's further military projection in the Middle East, Central Asia and Asia and foil the Bush administration's plans for subduing uncooperative governments in Iran and North Korea. Finally, Washington's unilateralist foreign policy will increasingly isolate the US to the benefit of China's foreign economic relations, making Beijing all the stronger.

Jephraim P Gundzik is president of Condor Advisers, Inc. Condor Advisers provides emerging markets investment risk analysis to individuals and institutions globally. Please visit for further information.

(Copyright 2005 Asia Times Online Ltd. All rights reserved. Please contact us for information on sales, syndication and republishing.)


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(Jun 7, '05)

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