The creation of an Asian regional economic entity is the subject of much discussion in Asian capitals. Ideas include the Asian Monetary Union; a full-fledged Asian Union, modeled after the European Union with its multiple pillars of cooperation; or something less comprehensive, like a greater Asian free trade area.
ASEAN is at the center of these talks. The association has long sought to use its collective structure to give member states more power in economic and political negotiations with outside parties than any state could achieve alone. But ASEAN has taken a non-interference pledge and as a group has few political or military ambitions. The association lacks the economic, political or military heft of Asia's two likelier centers — China and Japan.
The United States remains an influential power in Asia. Washington's perceived effort to use regional alliances to contain China does affect Beijing's behavior. However, the region has become more dynamic, especially as the regional center of gravity has shifted from Tokyo to Beijing over the past two decades. The upcoming trilateral summit, with its affiliated economic, political and security components, allows Asia's two major powers to discuss areas of competition and cooperation while avoiding some of the more contentious issues that would come up in a bilateral setting.
Japan wanes as China rises
Japan's two-decade stagnation may have had a limited impact on the average Japanese citizen and thus falls short of sparking a national crisis. Nevertheless, it has weakened Tokyo's regional standing. Tokyo has lost or abandoned many of the economic levers that allowed Japan to ensure its economic, political and security interests in Southeast Asia. The rise of China and South Korea puts additional pressure on Japan's overall economic and strategic position. We see a strengthening trend toward normalization in Japan as Tokyo recognizes the rising challenges to its regional and global strategic imperatives.
The trilateral engagement helps Tokyo gain from or at least temper China's economic rise, allows it to emphasize Tokyo's continued significance and perhaps helps mollify regional concerns of a return to Japanese imperialism as Tokyo attempts to recover its interests. While it once took the lead in regional mechanisms, Japan eventually turned its focus inward during its period of stagnation. Tokyo is now moving somewhat away from that inward focus, but it has yet to successfully reclaim regional leadership.
China, as Asia's rising regional power, is naturally seeing its area of interest expand. Asia, as one of the few economically large and growing regions of the world, is of critical importance to China's future economic plans.
China also sees regional relations as another ring in its buffer strategy. The Han regions of eastern China form the core of the middle kingdom and of modern China. The outlying regions of Tibet, Xinjiang, Inner Mongolia, Manchuria and at one time, Taiwan, constitute the first ring of China's buffer. Beijing is using economic connections to shape a second outer ring in Mongolia, Central Asia, Myanmar and the Mekong region — as well as in North Korea.
China historically has used this ring strategy to deal with its neighbors and to keep threats at bay. Beijing does not need to dominate other countries in the region; it relies more on maintaining good terms and forging enough economic (and potentially military) ties to reduce active opposition to China's evolving power.
South Korea, while not an economic, political or military match for either, works to stake out a position between its two larger neighbors. Seoul is a minor partner in this relationship, though it currently is making better progress than Japan in establishing trade negotiations with China. South Korea can exploit the gaps between Japan's and China's interests and perhaps gain Chinese assistance in managing North Korea. However, Seoul is as always caught in the unenviable position of being a minor player affected by two larger powers. When Japan and China both move, South Korea finds its room to maneuver greatly diminished.
Obstacles to Integration
Though some may envision an Asian Union along EU lines, Asian integration is less formalized for the most part. The long-standing rivalries between China, Japan and Korea have their parallel in Europe. However, unlike Europe during the Cold War, Asia lacks a global construct that would make integration more necessary than the independent pursuit of national interests. The global economic slowdown has helped realize such a construct — drawing Japan to the negotiating table, providing China with opportunities to exploit and re-emphasizing the need for regional pre-emptive financial crisis measures — but not to an extent great enough to overcome the differences between the key players.
As a maritime power interested in land facing a land power projecting into the sea, Japan and China are more likely to move toward increased regional competition than integration. Though the differences in both powers' interests are enough to make cooperation advantageous, the nature of the maritime-land power dynamic and the impossibility of mutual domination ensure that there will always be reasons to compete. The trilateral meetings and other similar dialogues and agreements provide ways for these countries and other regional players to try to manage that complex dynamic.