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The G-2: no good for China and for world governance

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In Brief

Since the onset of the financial crisis, there have been suggestions to form a G-2 consisting of the United States and China.

This proposal is based on the facts that China is the largest creditor of the U.S., the U.S. is China’s biggest export destination, and the strong interdependence of their two economies provides a foundation for joint action that can shape the global economy.

This thinking is tempting when the G8 is seen to reflect an outdated balance of power and the G20 is considered too diluted to respond to global challenges.

Yet a G-2 would give a false assumption about stronger global governance and China would probably not deliver in such a format. Let me explain why.

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China’s main focus is still its own economic development. Reread Premier Wen Jiabao’s statement at Davos on Jan. 29: he said, ‘steady and fast growth of China’s economy is in itself an important contribution to global financial stability.’ Or look at the closing statement of the National People’s Congress: ‘We have prepared enough backup firepower to deal with potential greater difficulties, and new stimulus packages, if necessary, will be launched.’

The main priority is, very naturally, on getting the Chinese economy going. That continues to be the source of the Communist Party’s legitimacy. If that link is broken, it could spell trouble. At the same time, 2009 is a sensitive year, full of anniversaries that involve such issues as Tibet and the 1989 Tiananmen demonstrations. Social disturbances because of the financial crisis could be on the rise. China will in many ways be inward-looking.

The responsibility gap. Some Chinese are flattered by the suggestion of a G-2. It shows China is a global power. It isn’t yet, and the Chinese realize that. None of the Chinese experts in government, think tanks, and scholars that I have talked to are enthusiastic about the concept. They all underlined the potential responsibility gap on China’s part as part of a G-2. Some even saw it as a potential trap for China that could expose it on the world stage. China is active in international reform now because its focus on internal growth converges with a more active foreign policy in financial and monetary matters. China is on the center court of international decision-making to protect a system of economic globalization that has provided China with many benefits.

That is reflected in diplomatic efforts undertaken with regard to financial reform and the IMF as well as floating suggestions regarding a new reserve currency. China is worried about the future value of its assets in dollars. Japan, South Korea, and Taiwan have similar concerns about foreign currency assets.

China’s new activism should be encouraged as part of its transformation into a responsible stakeholder. Nevertheless, China might not maintain its current profile – much depends on the duration and severity of the financial crisis – and could return to its more traditional ‘stay low’ diplomacy if external conditions for continued internal growth are again secured.

Don’t put all your American eggs in one basket. Former NSC director Dennis Wilder has argued that the U.S. ‘will, however, pay a heavy price with our long-term friends and allies in Asia by referring to increased economic cooperation with China as a new G-2.’ A G-2 would antagonize allies and friends – both of China and the U.S. – without providing extra value. If it’s only size that counts, then why not form a G-2 consisting of the EU (the world’s largest economy) and Japan (number three) instead of between number two (U.S.) and four (China)?

Furthermore, economic cooperation between the U.S. and China is much needed but world governance is still about more than economics. Will China really help in securing Pakistan or in Afghanistan? European soldiers are serving alongside Americans in Helmand, not Chinese. Will China really secure a nuclear-free Korean Peninsula or does it still prefer stability and crisis avoidance to crisis resolution?

Here U.S. cooperation with allies in South Korea and Japan is essential. And if there was a comprehensive settlement with North Korea, Europeans would be asked to contribute as they did with KEDO in the 1990s. China’s foreign policy is still deeply rooted in non-interference and at its best conflict-avoidance, although Beijing is moving toward a more responsible stakeholder-approach in multilateral settings.

China might also introduce its parochial concerns into global governance if given a G-2 role. Look at China’s recent snuff at India’s loan from the Asia Development Bank, presumably because of the unresolved border dispute. Should IMF loans in the future be conditioned on a given country’s view of Taiwan or the situation in Tibet?

The U.S.-China relationship is one of the most important bilateral relationships. There is need for tight coordination between the U.S. and China and perhaps some version of a Plaza Accord would benefit both countries. Yet, to turn that into a G-2 will create an illusion of global governance that will not deliver on its promise.

Jonas Parello-Plesner works as Senior Advisor with the Danish Government on Asian affairs. He is on the board of editors of the Danish magazine Raeson. He is currently on research leave studying East Asian political integration meeting with think tanks, experts and commentators in East Asia’s major cities. The views expressed are entirely his own.

3 responses to “The G-2: no good for China and for world governance”

  1. History is not necessarily rational and can be full of surprises.

    I personally don’t like power politics much, as a personal preference for world governance, to start with. In this sense, I have some sympathy to Jonas Parello-Plesner’s arguments in this article.

    But one has to be reminded, even though counter to my personal preference, that during the cold war era that stretching a few decades in the not so long past, it was the two world superpowers that dominated so many world affairs. The whole world had lived in the shadow of the display of the two superpowers.

    However, there were two good things that came out of that long agony. One was that there were two superpowers, not just one, so they sort or balanced each other out and did not lead the world into another world war. Another was that the collapse of the former USSR proved an important point to all nations and human beings that any system has to produce good both economically and politically, otherwise it will not last in the long term.

    The two cold war world superpowers gave way to the sole superpower of the US. What we got from that? Certainly the world had collectively sighed a great relief that the constant threat of a global nuclear destruction had gone. But what else have we got? We got heightened terrorist attacks, culminating by the 9/11 attack on the US and the subsequent invasions of Afghanistan and Iraq by the US and some of its allies and friends. The invasion of the former was internationally justified that Al Qaeda was harboured there.

    The invasion of the latter was not necessarily so, and in fact many have argued that was the act of the sole remaining world superpower and that there was little international justification for its so called pre-empty actions. The matter of fact is that the main excuse for the war in Iraq, that it had weapons of mass destruction, has been irrefutably proven to be false. But that war has had huge costs, in terms of both human and economically. Even the US has paid dearly for that adventure with rising military tolls and military and other spending related to that war. No one has been responsible for those huge costs.

    That was a legacy of an unconstrained or unrestricted sole world superpower. It can do what it wants and sometimes what it does can be very bad to others and to itself in the long run.

    Even now the UN Security Council is still governed by the vested veto power to each of the five largest victors of World War II. That is an uncomfortable reality. Although there have been calls for reforms to the UN governing structure, there have been also difficulties to change that outdated structure, one has to admit.

    Why and how the two superpowers did came into existence? It was probably anyone’s wishful thinking or doing. It was the natural evolution in the aftermath of World War Two. The US, a traditional power, emerged as the leader of the west, while the USSR, a new and emerging power with a different system became the leader of a number of aspirant but relatively poor nations that were struggling to seek to change their countries’ destiny.

    The two different systems competed and fighted with each other. They hated each with. They each wanted to destroy the other. So they built up their camps militarily with each having nuclear arsenals to destroy the whole world a few times over. On that point, the leaders of each camp had some sanity with them over that period, so they resorted to the principle of mutual deterrence that worked and saved the world from destruction. But eventually, one collapsed and disintegrated suddenly perhaps to the surprises of many including the very sophisticated intelligence of the other opposing camp. That was the outcome of anyone’s well thought design. History has been full of surprises in that regard.

    What about the G-2 concept? I don’t have an opinion at this stage, meaning I personally don’t have any idea. It may or may not work. Again history may present its surprises to us, irrespective whether we like it or not.

    Nevertheless, I hope that any development along that line will not follow the competing and opposing two superpowers of the cold war ear, even though they do represent two different systems and also one traditional power and the other emerging power. I hope if they do emerge as G-2, they will work co-operately rather than competitively with each other. The experience of the superpower politics in the cold war era should serve as a useful reminder to any superpowers in the years/decades/centuries to come, perhaps for all sides, both positively and negatively.

  2. It looks the author misunderstand some basic concepts: ‘global responsibility’ and ‘non interference’ policy. if you think these ideas contradicts with each other, you must support that a global responsibility’ entitles some countries to interference other countries. From this point of view, invasion to Iraq sounds really fascinate. possibly, as a academic, more works should be focused on how to understand responsibility in a global society. otherwise, what we can see is a rebirth of trusteeship or we call it neo-trusteeship which has long been proved unpopular.

  3. John,

    Countries certainly do have the responsibility to interfere with other countries’ under certain conditions. This responsibility was agreed to four years ago at the United Nations, and is called the “Responsibility to Protect” (or R2P).

    A simple google search will help you find the official website of the concept. Gareth Evans recently released a book on how the responsibility came to be agreed upon and what it means. The crux of the issue can be summed up thus (from http://www.responsibilitytoprotect.org):

    The Responsibility to Protect populations from genocide, ethnic cleansing, war crimes and crimes against humanity is an international commitment by governments to prevent and react to grave crises, wherever they may occur. In 2005, world leaders agreed, for the first time, that states have a primary responsibility to protect their own populations and that the international community has a responsibility to act when these governments fail to protect the most vulnerable among us.

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