‘China can make an offer and you can always say no’

PROF Wang Gungwu talked to Sunday Star the day after his public lecture. Below are excerpts from the 90-minute interview:

> When will we see the shift of economic dominance from the Atlantic to the Indo-Pacific in full swing?

Two things are crucial: China continues to develop economically, and India picks up some more.

If India continues to develop on the same trajectory of the last few years, then there is no question that the shift will continue to be firm. China has a good chance of keeping up. India has tremendous reservoir of talents, but its political system is uncertain. However, I am quite optimistic about India. Therefore, the location of SouthEast Asia just simply must become more important.

Maritime trade will always be dominant because land transport can never compete with maritime transport. If that continues to be true, then everything is going to pass through South-East Asia, which is smack in the middle of the two oceans. This has already begun to happen and will continue to be.

> Why is China pushing so hard for the Belt and Road initiative?

There are so many factors, and most people don’t know exactly what these are.

On the surface, there is surplus capacity in China. They are so efficient now in their manufacturing and technology that they are producing so much that cannot be sold. This is one way of opening up new markets for their products. The other part is, they want to find different alternative routes to the Straits of Malacca. They want to have a more direct and reliable access to the Mediterranean and Europe.

If you look at the economy of China in the last 40 years, its two major markets are North America and Western Europe. North America, no problem, the sea is open and now they have Panama on their side too.

Europe is always a difficult area; it’s entirely dependent on the sea. So if they can at least add another transport access like railways all the way to Hamburg and London, it helps. They are building the link to Myanmar and to Pakistan, the oil pipeline across Central Asia, a port in Greece, railways to France and Germany. They have to maximise their opportunities.

> In Malaysia, there are people who are fearful that China might spread its influence and eventually control Malaysia’s economy. What is your view?

How could China do that? Malaysia is a sovereign state with its own government, leaders and national interests. They don’t have to take anything from China and China cannot force itself on Malaysia.

China can make an offer and you can always say no. You take the investment because you calculate it and think it suits your national interest. As far as China is concerned, they offer to anybody. It’s your own government’s decision.

> How do you see the future of South China Sea? Is there a possibility to resolve the disputes?

There are two insoluble problems.

First, the question of what is the Law of the Sea is never clear because all laws about boundaries are dealt on land. There is freedom of navigation and the 12 nautical miles limit of your coast that people must respect. Parking an aircraft carrier 13 nautical miles away from the Chinese coast is considered a hostile act for China.

Second, a sovereign dispute has nothing to do with the freedom of navigation. We deal with it bilaterally. But of course, the Vietnamese and the Filipinos know that bilaterally they will be at a disadvantage because China is big and they are small. They want the Americans to come in and that complicates the issue.

The American interest is to prevent China from becoming stronger, while the Chinese interest is to prevent the Americans from blocking them.

> Is there anyway South China Sea (SCS) can be calm?

The Code of Conduct (COC, expected to be signed by Asean and China this year) is something I am still optimistic about, not because it will solve all problems, but it can keep the place calm.

The Chinese are suspicious of rules that are already fixed and of people who are applying the rules on them. China says, hang on, is

this beneficial to me?

At the moment, the COC is open and China can negotiate the rules. There is no excuse. It’s been more than 10 years of disagreement, but maybe now that the situation has calmed down everybody can at least agree to a certain set of rules.

To say the Chinese are not rulebased is overstating it. They accept rule of supply and demand, comply with UN rules, and they don’t challenge rules; but they are very suspicious of certain given rules that were made before they had any say in the matter. In fact, the Americans have never ratified the United Nations Convention on the Law of the Sea.

> Why then is China putting up military installations at SCS?

I don’t know what the Chinese are really up to, but if they think it is their sovereign territory and there are hostile forces around, to arm it seems logical.

If the Chinese can persuade others that this is the new norm, why not? They will say, we are not going to take over your islands but you can’t take ours. The thing is, don’t ask the Americans and Indians (by Vietnamese) to come.

> Do you agree with how Malaysia is handling the South China Sea territorial disputes?

Malaysia has always not wanted to be too close to America or China. I think generally, it wants to be in the middle and be flexible on both ways.

Malaysia is probably very wise not to make a fuss because they can see a lot of trickery behind the decision. Malaysia understands it is not entirely straightforward. They do not want to be associated with what the Philippines did (taking the matter to The Hague). They want to deal with China bilaterally. Malaysia thinks this is the wisest policy, and I think that make sense. But it is not easy.