C3S Paper No. 0032/2016
On solving territorial issues like the one concerning sovereignty over islands in South China Sea (SCS), the People’s Republic of China (PRC) opposes giving any role to a multilateral framework and instead stands for direct talks between it and other contesting nations. Firmly reflecting this stand is the PRC’s position that the ASEAN Foreign Ministers meetings cannot be the platform to discuss SCS issues and that the arbitral tribunal at the Hague, set up at the behest of the Philippines, has no jurisdiction over such issues. Of equal importance is the declared “dual track approach” of the PRC towards the SCS disputes – one providing “for addressing them by countries directly concerned through friendly consultations and negotiations and in a peaceful way”, and the other stipulating “joint maintenance of peace and stability in the SCS by China and ASEAN countries”. The latter aspect, as China visualizes, would specifically entail making joint efforts by the PRC and ASEAN powers to implement the already signed “Declaration on the Conduct of Parties in the South China Sea”, accelerate the negotiations on the “codes of conduct” in the South China Sea and achieve these codes as soon as possible based on a “consensus” ( Chinese Premier Li Keqiang, China-ASEAN summit, Kuala Lumpur, November 21,2015). Significantly, the “dual track approach” is suggestive of China’s new willingness to allow playing of some role by the ASEAN in the matter of finding a way to solve the SCS issues, in other words, China’s acceptance of application of a sort of “necessary multilateralism” to find remedies to the issues.
On the other hand, with regard to pursuing its perceived strategic interests on matters not involving territorial sovereignty, China is actively seeking to promote multilateralism; the stated purpose is to conduct a multilateral diplomacy so as to lead regional economic development, but the PRC seems to also eye on the likely gain in its strategic influence in the neighborhood and beyond. In this regard, its motives could be three fold –removing the existing “China Threat” apprehensions, countering the US influence and establishing a new China-led regional security order. Examples of China’s multilateral initiatives include its sponsoring of the Asian Infrastructure Investment Bank (AIIB), cooperation programme under BRICS framework, participation in the mechanisms of G-20, APEC and ASEAN foreign ministers , taking part in the SCO and China-Africa Cooperation fora and last but not least, the launch of a “belt and road” initiative . For their own strategic reasons, the US and Japan have kept themselves outside AIIB and India is having reservations on joining the PRC’s “belt and road” initiative.
In the paper which follows, an attempt has been made to thoroughly examine all aspects governing Beijing’s evolving policy on multilateralism; focus has been given on explaining the compulsions being felt by China to apply different yardsticks – rejecting multilateralism in settling the geo-political territorial issues and accepting multilateralism as part of drive to play a lead role in the geo-economic regional development process.
The conclusion drawn in the paper is that , China’s opposition to a multilateral approach on sovereignty related issues could be because of its fears that any involvement of a multiplicity of actors may lead to internationalization of such issues and that if that happens, potentials for the country to come under pressure to make compromises with regard to the sacrosanct core national interests, may increase. No doubt, understanding the philosophy behind China’s selective approach on multilateralism is a must for the global nations, especially the regional neighbors, as they engage the PRC in various international forums.
Given that in international relations, the term ‘’multilateralism’’ means working in concert of multiple countries on a given issue, it looks beyond doubt that acceptance of the term in the conduct of its foreign policy by the People’s Republic of China (PRC) is selective. On one hand, the PRC rejects a multilateral approach in settling the geo-political territorial issues; on the other, it is willing to embrace the same with respect to fulfillment of its geo-economic goals. Through launching several regional multilateral initiatives, it seeks to integrate the country’s economy with those of the concerned countries and thereby gain strategic influence in the region.
A typical example of China’s opposition to a multilateral approach towards settling territorial issues is its stand on the disputed South China Sea (SCS) islands. In August 2014, the PRC Foreign Minister Wang Yi introduced his country’s “dual track approach” on the issues by saying that they need to be “addressed by countries directly concerned through friendly consultations and negotiations and in a peaceful way, and that peace and stability in the SCS are to be jointly maintained by China and ASEAN countries”. Wang Yi expounded on the rationale behind the approach; he said, “first of all, consultations and negotiations by countries directly concerned are the most effective and viable way to resolve disputes, which also conform to international law and common practices and constitute one of the most important provisions in the Declaration on the Conduct of Parties in the South China Sea. Second, peace and stability in the South China Sea concerns the real interests of all littoral countries of the South China Sea, including China and ASEAN countries. It is the responsibility and obligation of both sides to work together to uphold peace and stability in the South China Sea. Past experience over the years proves that as long as parties concerned remain committed to the dual-track approach and encourage positive interactions between efforts along the two tracks, China and ASEAN countries are well capable of effectively managing and properly handling specific disputes and maintaining overall peace, stability and cooperation in the region”.
On November 13, 2014 in Naypyidaw (Myanmar), the PRC Premier Li Keqiang gave a speech clarifying China’s “dual track approach” to handle the SCS disputes. Li said “China and ASEAN members have identified the dual-track approach for dealing with the South China Sea issue, according to which specific disputes are to be solved through negotiations and consultations by countries directly concerned and peace and stability in the region be jointly upheld by China and ASEAN countries working together”.
On December 7, 2014, China’s Foreign Ministry released a “Position Paper on the Matter of Jurisdiction in the South China Sea Arbitration Initiated by the Republic of the Philippines” which made three points: the South China Sea disputes must be solved though political dialogue; China will not accept any ruling from international arbitration; and China’s action in this regard have a strong legal basis. The position paper asserted that “China has indisputable sovereignty over the South China Sea Islands (the Dongsha Islands otherwise known as Pratas , the Xisha Islands known as Paracels, the Zhongsha Islands known as the Macclesfield Bank, and the Nansha Islands known as Spratlys) and the adjacent waters. The issue of the South China Sea involves a number of States, and is compounded by complex historical background and sensitive political factors. Its final resolution demands patience and political wisdom from all parties concerned. China always maintains that the parties concerned shall seek proper ways and means of settlement through consultation and negotiation on the basis of respect for history and international law. Pending its final settlement, all parties concerned should engage in dialogue and cooperation to preserve peace and stability of the South China Sea, enhance mutual trust, clear up doubts, and create conditions for the eventual resolution of the issue. The unilateral initiation of the present arbitration by the Philippines will not change the history and fact of China’s sovereignty over the South China Sea Islands and the adjacent waters; nor will it shake China’s resolve and determination to safeguard its sovereignty and relevant maritime rights and interests; nor will it affect China’s policy and position of resolving the disputes in the South China Sea by direct negotiation and working together with other States in the region to maintain peace and stability in the South China Sea”.
Lastly, what Wang Yi, the PRC foreign minister, said at ASEAN foreign ministers meeting, held at Kuala Lumpur on August 3, 2015 looks important. He observed, “The ASEAN Foreign Ministers’ Meeting is not a proper platform for discussing the South China Sea issues, specifically the territorial disputes. It has been proved many times that attempts to raise such disputes at a multilateral forum do not help resolve the underlying issues. On the contrary, more serious confrontations and clashes may emerge afterwards”.
China’s statements above, particularly that coming from Foreign Minister Wang Yi, appear to reveal at the same time the country’s willingness to show some diplomatic flexibility on the SCS issue, but without diluting its basic stand favoring “direct talks” with littoral contestants. They seem to convey a message that the ASEAN can play a role in finding solution to the SCS disputes, provided there is no interference from countries outside the region, which is being seen as signs of China somewhat allowing “necessary multilateralism” and “appropriate regionalization” to play a role in SCS issue. Flexibility signs may also have to be seen in the context of China’s “One Belt, One Road “initiative which is designed to defuse the SCS disputes, a major irritant in the country’s ties with ASEAN. Another point is that China’s positions so far expressed do not clarify the “nine-dash line”, as against demands to do so coming from other littoral contestants.
It is being alleged that China, in its own interests, has been able to exploit divisions among ASEAN powers and applied economic pressure, both positive and negative, to keep them from reaching a consensus on regional maritime security. Whether this is true or not, the fact is that the ASEAN remains unable so far to arrive at a united approach on responding to China’s assertiveness in the SCS. In fact, a split in the ASEAN on the SCS issue has been visible at the August 2015 ASEAN Foreign Ministers meeting held in Kuala Lumpur. There was no unanimity among ASEAN powers on that occasion regarding China’s island construction in disputed areas. Understandably , the Philippines and Vietnam opposed the PRC’s building of artificial islands in the SCS, while Thailand and Cambodia were lukewarm in criticizing China. Such a situation resulted in watering down of the final statement issued after the meeting.
Another example of China’s opposition to “multilateralism” as a mean to solve sovereignty-related issues is its position on settling the border issue with India. Beijing seems to be uneasy with any attempts to internationalize that issue. It may be interesting to note in this connection that signs have appeared suggesting that China may be becoming suspicious of the US support to India on the border issue. Influential Chinese writers (Professor Zhang Li, South Asia Research Center, Sichuan University) have said that the support of Washington “led to a hardening of India’s position on disputed border with China like that in Aksai Chin, Sikkim and Arunachal Pradesh”. They (Prof Wang Dehua) have remarked that the Indian army’s intrusions into the Chinese side were encouraged by the US so as to make some noise to distract China from the South China Sea, where it is in a spat with its sea neighbors such as the Philippines and Vietnam over the disputed islands. But India is neither on the US side nor on China’s side, but has its own agenda.” Scholars ( like Zhang Mi of the Independent Dujia Network based in Beijing, April 9, 2015, www.dooo.cc) have alleged that the US is provoking India in the latter’s relation with China, by offering the bait of support to India’s permanent membership in the UN Security Council, adding that India remains unmoved.
Chinese suspicions on US as above need to be understood in another context. For the first time, Japan has sided with India on Arunachal issue (Foreign Minister Kishida, New Delhi, January 2015, while offering Japan’s support to India’s development projects in the Eastern Sector). Also, for the first time in recent years, a foreign power seems to have come in open support of India on the issue. With apparent concern over any internationalization of Arunachal issue, the Chinese foreign ministry promptly conveyed its ‘serious concern’ to Japan on this count. A PRC scholar affirmed that Kishida’s words had “unveiled Japan’s intent of ‘uniting’ the countries that have territorial disputes with China, in an attempt to create a strong impression that Japan, along with China’s other neighboring countries, is bullied by a rising China.”
A third example of China’s opposition to “multilateralism” as a mean to solve sovereignty-related issues is its stand on the dispute with Japan over Senkakus islands (called Diaoyu by China). Beijing rejects a multilateral approach in this case and stands for “settling the relevant issue through dialogue and consultations”.  In 2014, China and Japan agreed to gradually resume political, diplomatic and security dialogue while acknowledging different positions on the Diaoyu Islands. The November 2014 summit meeting between the PRC President Xi Jinping and Japanese Prime Minister Shinzo Abe which resulted in an agreement to set up a maritime crisis mechanism indicate the desire of both the sides to hold direct talks on maritime issues concerning East China Sea including the Senkakus question. Beijing opposes any outside intervention on that question particularly from the US; it finds problems with Washington’s view that defense of the Senkakus fall under Article 5 of the US-Japan Security Treaty.
Why China avoids a multilateral approach and instead prefers direct talks to settle sovereignty-related issues, is a question which deserves deep attention. The PRC Foreign Minister Wang Yi’s explanation (see previous paragraph) that multilateral fora do not help resolve the underlying issues and on the contrary, more serious confrontations and clashes may emerge afterwards, gives out China’s perceptions. Though not said by China, the roots of such perceptions seem to lie with the core-interests based foreign policy which is prevailing in China since middle of 2009. Identifying China’s “core interests”, Dai Bingguo, who played a major role in foreign policy making, said in end July 2009 that “the PRC’s first core interest is maintaining its fundamental system and state security, second is state sovereignty and territorial integrity and the third is the continued stable development of the economy and society.” In specific terms, Tibet, Xinjiang, Taiwan and South China Sea Islands as well as strategic resources and trade routes stand officially listed under the ‘core interests’ category; the PRC at various levels has averred that it will make no compromises on them and never waive its right to protect them with military means.
Why the focus in China’s foreign policy turned to protecting “core national interests”? In the words of Chinese experts, the PRC is ‘going global and its international influence are becoming more visible and assertive and the nation’s diplomatic strategies accordingly need to comply with the changes in the international environment and domestic conditions’. Evolving ‘multi polarity’ and ‘multilateralism’ as well as global challenges including climate change and energy security, mark the changes in the external conditions, according to the then Chinese foreign minister Yang Jiechi.
The core-interests based foreign policy is giving rise to China’s more and more assertiveness in international relations. Neighbors involved in territorial disputes with China are particularly worried about this trend. A variety of factors seem to be contributing to such assertiveness – (i) Beijing’s growing confidence internationally due to the country’s ability to maintain high growth rates , (ii) China’s feeling that an opportunity has arisen for itself to increase its influence globally as the world balance of power shifts from the West to East and a multi-polar world gradually emerges, (iii) the PRC’s growing need to protect land and sea trade routes in the interest of the much needed import of resources from abroad and (iv) deepening Chinese fears concerning sovereignty over Tibet and Xinjiang as well as continuing suspicions on US strategy towards Taiwan.
In the background given above, it becomes clear that China is very much hesitant to take up issues which it considers vital for protecting the country’s territorial sovereignty, into multilateral fora, fearing that any involvement of a multiplicity of actors may lead to internationalization of such issues; it may feel that if that happens, potentials for the country to come under pressure to make compromises with regard to the sacrosanct core national interests, may increase.
On the other hand, “multilateralism” has become the mean for the PRC under President Xi Jinping, with regard to its pursuing the country’s perceived strategic interests in fields other than those relating to territorial sovereignty. The declared foreign policy now of China aims to take “major multilateral diplomatic actions at a time when the global political and economic situations are faced with new challenges, new adjustments and new developments.” Examples of such actions include the PRC’s readiness to sponsor the Asian Infrastructure Investment Bank (AIIB), cooperation under Brazil-Russia-India-China-South Africa (BRICS) grouping, participation in the mechanisms of South Asia Association for Regional Cooperation (SAARC), G-20, East Asia Summit, APEC and ASEAN foreign ministers , playing lead role in the SCO, holding China-Africa Cooperation Forum meetings, and last but not least, the launch of a “belt and road” initiative. As China sees, such multilateral moves, being accelerated by it under the changing conditions, are meant to provide assistance to the global and regional economic development. Looking impartially however, there seem to be some other motivating factors which look strategic in nature. These factors include the need being felt by Beijing to remove through its participation in the multilateral institutions, the existing doubts in the region about the so-called China threat, to neutralize the U.S influence in the region, and to build new regional security architecture with China at its centre. It looks justifiable under the circumstances for other regional nations to fear about the PRC’s real aim to spread its strategic influence in the neighborhood and beyond through its multilateral actions. For this reason, the US has kept itself outside AIIB and India is having reservations on joining the China’s “belt and road” initiative.
Whether China’s multilateral moves are producing desired results for China is open to question. Some can be deemed successful and some otherwise. Taking the case of Xi Jinping’s “Belt and Road” initiative, it can be said that it has certain flaws – it is loose and non-binding internationally and is ‘unilateralist’ as the PRC is its sole originator and promoter; this is despite Xi’s description of the initiative as an open and inclusive platform. Unless the initiative gets linked with other global institutions like the United Nations, the World Bank etc, in order to make it a new multilateral trade and investment mechanism for its participants, it may remain ineffective.
China is an active player in the multilateral East Asia Summit (EAS) mechanism. It wants the EAS to function as “a leaders-led strategic forum, focusing on major issues of overarching importance, finding ways to increase consensus and properly managing differences”. At the same time, there are constraints for China in the EAS . While China is against the EAS discussing regional territorial issues, other members strongly stand for such discussions, for e.g they raised the SCS issue prominently in the 10th EAS Summit (Kuala Lumpur, November 2015). Five of the 31 paragraphs in the entire EAS Chairman’s statement issued during the summit were devoted to the SCS issue. With respect to that issue, they noted the importance of peace, stability and freedom of navigation and over flight, serious concerns about ongoing developments, and the urgent need to conclude a binding code of conduct. As a second inhibiting factor, conceptually, China has a view on EAS different from that of other members. It wants ASEAN plus 3 (10 ASEAN nations, China, South Korea and Japan) to play a leading role in the EAS; it considers India, Australia and New Zealand as ‘secondary’ group in the EAS. On the other hand, countries like India favor ASEAN plus 6 (10 ASEAN members plus Australia, China, India, Japan, New Zealand, and South Korea) to play a lead role. Such differing Chinese perceptions are certain to affect the PRC’s role in the EAS.
On the other hand, China seems to be succeeding in the case of AIIB. The latter has earned international legitimacy. While the US and Japan have not joined the AIIB which has 57 member nations so far, US allies like Germany, Britain and France are among the organisation’s members. India is in the AIIB. With estimated capacity to lend US$ $10-15 billion a year during the first five or six years of its functioning , the AIIB has potentials to steadily revamp the global financial architecture. Also, it seeks incorporation of the New Development Bank of the BRICS grouping. It is expected to support China’s Belt and Road initiative seeking to connect China with Europe. It is being foreseen that the AIIB can open a new channel of funding for the developing nations which have so far been dependent on the western dominated International Monetary Fund (IMF), the World Bank and the Asian Development Bank (ADB), in which Japan plays a pre-eminent role. 
Special note needs to be taken about the success achieved by China in its multilateralist approach to cooperation with ASEAN nations. The PRC is actively pursuing a ten-point proposal for China-ASEAN cooperation which include formulation of a Plan of Action to Implement the Joint Declaration on the ASEAN-China Strategic Partnership for Peace and Prosperity (2016-2020), formation of a working group to discuss the signing of a China-ASEAN treaty on good-neighborliness, friendship and cooperation, speeding up of China-ASEAN maritime cooperation, preparations to make joint efforts to promote sub-regional development, taking of active steps towards concluding soon a Protocol to the Treaty on the Southeast Asia Nuclear Weapon-Free Zone , strengthening of defense and security cooperation with ASEAN nations, and upholding of peace and stability in the SCS jointly with ASEAN countries. China and the ASEAN members have set a goal to conclude the negotiations on upgrading the China-ASEAN Free Trade Area by the end of 2015, providing for a larger foothold in each other’s markets with more access to foreign goods and investment.
China’s multilateral diplomacy seems to be effective in the case of the Shanghai Cooperation Organisation (SCO) .Established in 2001 as a regional body to deal with non-traditional security cooperation between China, Russia and four Central Asian states: Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan, the SCO’s focus is on fighting regional terrorism , ethnic separatism and religious extremism which benefits China in tackling Uighur separatism in its restive Xinjiang province. Also, Beijing through the SCO has been able to get some economic and political foothold in Central Asia; however the persisting fighting in Afghanistan continues to be a negative factor for China for in this regard.
The purpose of the PRC’s multilatralist approach towards South Asian Association for Regional Cooperation (SAARC) is not only to lead regional economic development in South Asia, but also to influence the geo-politics in the region in commensuration with its growing global power. China’s trade with and investment in SAARC nations are growing. It is India’s largest trading partner and has the goal of signing a China-SAARC free trade agreement. As China speeds up its involvement with SAARC nations, it is natural that it finds in India, the dominant regional power, both a partner and competitor. The PRC visualizes that both the nations can work together as ‘dual engines’ for regional stability and development. At the same time, it , an observer SAARC nation now, is showing keenness to join that organization as a full member with an eye on expanding its presence in South Asia which has won the support of regional nations like Pakistan and Nepal ; such a situation suggests a China-India competition in the region for influence, which may grow in future particularly as the latter suspects China’s intentions behind its incorporation of Pakistan occupied Kashmir in its economic corridor project with Pakistan under the framework of its “belt and road” initiative. Under such circumstances, the question as to how far India will allow China’s foray into the SAARC becomes important.
In conclusion, it can be said that China’s opposition to a multilateral approach on sovereignty related issues could be because of its fears that any involvement of a multiplicity of actors may lead to internationalization of such issues and that if that happens, potentials for the country to come under pressure to make compromises with regard to the sacrosanct core national interests, may increase. No doubt, understanding the philosophy behind China’s selective approach on multilateralism is a must for the global nations, especially the regional neighbors, as they engage the PRC in various international forums.
On China’s part, it should recognize the merits of the “multilateralism” concept and apply it to solving all cases of contentious disputes, whether they are sovereignty-related or not; that would be in the interest of regional stability and prosperity. Steps taken by the PRC like its creation of artificial islands and construction of airfields in the disputed South China Sea, setting up of its own administrative structure to govern the Senkakus which is now under possession of Japan and increasing of naval patrols close to contested territories, strongly suggest the country’s choice at this juncture to resort to unilateral actions on the territorial issues. However, as pointed out above, China seems to have begun to show some inclination towards allowing “necessary multilateralism” and “appropriate regionalization” in dealing with SCS islands issue, which appears to be a positive sign.
 Wang Yi: Handle the South China Sea issue through the “dual-track” approach, August 9, 2014; http://www.fmprc.gov.cn/mfa_eng/zxxx_662805/t1181523.shtml
 This aspect, as China visualizes, would specifically entail making joint efforts by the PRC and ASEAN powers to implement the already signed “Declaration on the Conduct of Parties in the South China Sea”, accelerate the negotiations on the “codes of conduct” in the South China Sea and achieve these codes as soon as possible based on a “consensus” ( Chinese Premier Li Keqiang, China-ASEAN summit, Kuala Lumpur, November 21,2015).
 China, ASEAN identify dual-track approach to S China Sea issue , Xinhua, November 13,2014, http://english.gov.cn/premier/news/2014/11/13/content_281475009489708.htm
 China’s position paper on South China Sea, Xinhua, December 7, 2014, http://www.chinadaily.com.cn/china/2014-12/07/content_19037946.htm
 Multilateral forums not the right place for discussing sea disputes, China Daily, August 6,2015, http://www.chinadaily.com.cn/opinion/2015-08/06/content_21513580.htm
 “China reacts cautiously to over 500 transgressions remark”, PTI, May 18, 2012, http://articles.economictimes.indiatimes.com/2012-05-18/news/31765593_1_boundary-sino-india-border-actual-control
 Geng Xin, Renmin University, Beijing, “New Delhi won’t fall for Tokyo’s attempts to stir up trouble with Beijing” , Global Times, 23.1.2015
 Foreign Ministry Spokesperson Hong Lei’s Regular Press Conference, January 12, 2016, http://www.fmprc.gov.cn/mfa_eng/xwfw_665399/s2510_665401/t1331109.shtml
 China, Japan reach four-point agreement on ties, Xinhua, November 7, 2014 http://news.xinhuanet.com/english/china/2014-11/07/c_133772952.htm
 China Daily, July 13, 2010, Global Times Editorial, July 26, 2010
 “ China’s core Interests diplomacy gains ground”, People’s Daily online, 20 November 2009.
 Chinese Foreign minister Wang Yi, November 19, 2015; http://www.fmprc.gov.cn/mfa_eng/zxxx_662805/t1317348.shtml
 Premier Li Keqiang, 10th EAS Summit, Kuala Lumpur, November 2015
 Multilateralism holds key to success of ‘Belt and Road’,
Pang Zhongying addresses the 2015 Corporate Finance Summit in Shenzhen hosted by the Bank of Communications Hong Kong Branch, China daily-Asia, November 4, 2015, http://www.chinadailyasia.com/special/2015-11/04/content_15339463.html
 Opening of AIIB part of global financial revamp BEIJING, January 16, 2016 http://www.thehindu.com/news/international/xi-officially-launches-aiib/article8113811.ece
 Wang Yi Brought Forth a Ten-point Proposal on China-ASEAN Cooperation, August 6, 2015, http://www.fmprc.gov.cn/mfa_eng/zxxx_662805/t1286715.shtml
(The writer is D.S.Rajan, Distinguished Fellow, Chennai Centre for China Studies, Chennai, India. This formed the basis of his talk on the subject at the international conference on “Multilateral Cooperation: Emerging Global Scenario”, organized by the UGC Centre for Southeast Asian and Pacific Studies, Sri Venkateswara University, Tirupati, India, on February 22-24 ,2016. Email: email@example.com)