Viewpoint: China and the world

The central challenge for China and its relations with the wider world will be managing its own inexorable rise, writes former Australian Prime Minister and China expert Kevin Rudd as part of a series of features on challenges for China's new leadership.

Xi Jinping - the man most likely to become China's new president - appears to be a man very comfortable with the mantle of leadership.

He will take the helm at a time when China is emerging as the world's largest economy. This will be the first time since George III that a non-English speaking, non-Western, non-democratic state will dominate the global economic order.

Xi can have confidence in his family background, given the contribution of his father Xi Zhongxun to the Chinese revolution and to subsequent economic development. He has served in the Chinese military. He is confident of his economic credentials - holding senior positions in provincial administrations has given him the experience to manage the demands of economic development.

And over the last five years Xi has spent a lot of time deepening his understanding of international matters, most particularly China's relationship with the United States.

He is the sort of leader the US leadership can do business with as he seeks to continue China's modernisation while maintaining strategic stability in East Asia.

East Asian nationalism

What we know from economic history is that political power invariably flows from economic power and, over time, foreign and security policy power follow suit.

But the core challenge for China and the rest of the world will be managing the rise of China while maintaining and strengthening the current international rules-based order that has underpinned global strategic stability and economic growth since World War II.

The current order has served China well over the last 30 years during its reform and modernisation period.

It is in China's interests that this order continue into the future notwithstanding the fact that it was not an order constructed with Chinese participation but rather by victorious Western powers after the fall of Berlin.

Angry crowds protested in China and Japan over disputed islands

While China's economic power has grown rapidly, its military capabilities are significantly less than those of the US. Militarily, the US will remain the world's only superpower until the middle of the century - that is, a power with truly global strategic reach.

But within the East Asian theatre or within the wider Indo-Pacific region, China's capacity is becoming greater. Chinese strategic capabilities, the force structure of its military together with its emerging military doctrine are aimed at supporting China's "core interests" - in which the Chinese include long-term political unity with Taiwan, and the protection of China's territorial and maritime claims in both the East China Sea and the South China Sea.

These claims are hotly contested by a large number of other regional states. Whereas the United States remains neutral on the merits of each of these claims and counter-claims, the South China Sea as well as the Diaoyu/Senkaku islands represent significant flashpoints for the future.

Political nationalism is alive and well across East Asia. Despite the fact that the economies of the region are increasingly integrated, the fires of political nationalism can easily be stoked. These in turn become increasingly difficult to manage for the governments of the region - be they democratically elected or otherwise.

The key challenge for the region therefore is to build regional security including confidence and security-building measures between the militaries. This is emerging as a crucial task for the East Asia Summit - the pan-regional institution with high-level political participation and an open political and security agenda.

Open global markets

Beyond the eastern hemisphere, there is an open question of how China will exercise its foreign policy influence across the world.

For the period ahead, it should always be remembered that China's paramount national objective is to complete the economic modernisation task for its nation and for its people. The centrality of this task governs much of China's foreign policy behaviour.

China wants global strategic stability to continue for the simple reason that conflict undermines prospects for economic growth.

China also wants to ensure continued access to global markets which have been so fundamental to the success of China's economic development so far. Over time, the Chinese leadership hope that domestic consumption will provide a much stronger driver of its own economic growth than international demand.

China has become concerned about the fragility of the global economy given its experiences with both the global financial crisis and the euro crisis. Nonetheless open trade and investment flows will remain important for China's medium-term economic future.

China also has a deep national political interest in becoming a respected global power. This therefore also goes to the heart of China's contributions to the stability of the global order.

Its position as a permanent member of the UN Security Council is already of pivotal significance, the ongoing Syrian crisis where China has continued its support for Russia's veto of substantive UNSC action on Syria highlights a continuing conflict within China's foreign and security policy establishment.

China deeply values its position on the security council

The foreign policy establishment is highly sensitive to international reaction to China supporting or protecting authoritarian regimes be they in Damascus, Tehran or Pyongyang; the security establishment is driven by one of the deep axioms of Chinese international policy from the inception of the People's Republic namely the principle of mutual non-interference.

China is, however, likely to become a more active participant in a full range of global institutions - social, economic, humanitarian and environmental.

China is already a significant contributor to UN peacekeeping operations around the world. And it has also developed a new international aid policy which, while different from that of developed countries (whose principles are driven by the Development Assistance Committee of the OECD) will nonetheless mean that China will become a more prominent player in aid relationships across the developing world.

China in Africa

This will be particularly evident across Africa where China has profound economy and foreign policy interests. China identifies Africa as an alternative source of energy and raw materials that are essential to the continuation of China's economic modernisation process.

Chinese foreign direct investment flows into the African continent will grow. This in turn will continue to generate domestic political controversies in various countries (most recently evidenced in Zambia) where local tensions have arisen concerning the returns to local communities from large-scale mining development.

Africa also remains significant for China's position within the developing world. In Africa there has been much debate around the so-called "Beijing Development Model" whereby successful economic growth through market reforms can be achieved without yielding to full-scale political liberalisation of the type seen in Western liberal democracies.

China therefore will continue to be a major economic and foreign policy player in each capital across the continent, including the African Union itself in Addis Ababa where China has just funded the construction of the new AU HQ exclusively from its own resources.

So will there be major foreign policy changes on the large questions facing the international community in the decade ahead? In broad terms, Chinese foreign policy will continue to follow the contours outlined above. There is therefore likely to be more continuity than fundamental change.

Nonetheless the core question for China will remain what influence it will seek to bring to bear on the future evolution of the global rules-based order itself.

If there is to be a change to the order, China has yet to articulate the conceptual and policy framework for it. The rest of the international community therefore has an opportunity (both for good and for ill) to help shape Chinese thinking during this most significant time.

Our core argument to our Chinese friends across the world should be to strengthen the existing order rather than allow it to become increasingly dysfunctional, let alone replace it with something else.