An Even Match

09/01/2012 11:09 GMT | Updated 07/03/2012 10:12 GMT

A November 2011 report by the U.S.-China Economic and Security Review Commission, a US congressional advisory panel, urged the White House and US Congress to scrutinize China's military expansion and pushed for a tougher stance against, what it dubbed as, anticompetitive Chinese trade policies.

While China's military, which benefited from a threefold increase since the 1990s in the military budget to about US$160 billion in 2010, does not pose a threat to the US, it does so to many nations in the region. Apart from building ports (also known as 'pearls') across the Indian ocean that form as its security eyes, China has, over the years, taken measures to boost its control of maritime resources in the East China Sea and the South China Sea.

At the same time, China invested substantial efforts in the last decade in building economic relations with East Asian nations via regional bodies like the Association of Southeast Asian Nations (ASEAN), the ASEAN+3 (ASEAN, plus China, Japan, and South Korea), and the ASEAN Regional Forum (ARF).

With the help of the regional arrangements, China is replacing the United States as the economic engine of Asia. It buys up huge amounts of raw materials, goods and parts, and pours in large amounts of foreign investment into its Asian neighbours.

In that backdrop, the US government, in 2011, decided in favour of a renewed focus on Asia by hastening its decisions to forge relations with multilateral organisations in the continent from both economic and military standpoints.

In November 2011, Obama declared that the US hoped by December 2012 to see the Trans-Pacific Partnership (TPP), now being negotiated, become a high-quality trade and investment platform that will include the major economies of the Asia-Pacific.

The principles of TPP, which does not include China in the initial group of countries, greatly differ from China's approach to trade, and are being structured around values that the US champions in terms of, amid others, transparency and protection of intellectual property.

In the same month, the US formally joined the East Asia Summit (EAS) in Bali, Indonesia. President Obama used his inaugural speech to guide the EAS towards focusing on prickly security issues in the region, especially those involving maritime security. The suggestion was not to Beijing's liking, but was supported by EAS participants that have disputes with China on the issue of dominion over South China Sea waters and regions.

The US continued its activism in the region in 2011 with a very high-profile engagement with the Myanmar regime in December 2011 via a visit by US Secretary of State, Hillary Clinton. The visit, the first in 50 years by a US secretary of state to Myanmar, was significant as it marked US having a dialogue with a regime that it not only does not officially recognize - on account of democracy and human rights violations by the military rulers - but also that has been supported by China during the last two decades of political isolation.

Continuing the surge in the region, the office of the US government spokesperson, in a press release in December 2011, informed that the US hosted Japan and India - both traditional rivals of China - for the first ever trilateral dialogue to "exchange views on a wide range of regional and global issues of mutual interest".

The renewed, and frantic, US interest in the region - from South Asia to the Asia Pacific - and, more importantly, the growing relations between US and other Asian nations has not gone unnoticed in China, naturally.

But even as China has not so far made any comment on the developments, state-run China Daily, reacting to the emerging alliance of Asian nations with the US, reported, "Japan's cooperation has been moving from bilateral to multilateral, trying to include the United States, Australia and India in its Arc of Freedom and Prosperity."

It is difficult to predict the Chinese responses in 2012 to the current US crusading in the region. Much will depend upon China's own economy and the preparedness of the smaller nations in the Asia-Pacific and East Asia to engage further with the US even at the risk of earning China's wrath.

For the moment, the US is on an overdrive and China is observing the situation. The game is on.