08 March 1996 - 10 March 1996

East Asia: Regional Identity, Regional Progress Regional Cooperation

Our special collaboration with the Japan Foundation brought together a gathering of notable weight and breadth, with at least one country making its Ditchley début; and we tackled a region of wide ambit and, as we acknowledged from the outset, extensive diversity in almost every dimension.

The fact of diversity recurred continually in our discussions, for example as we noted the sharp difference as between one country and another in the stage of economic development reached; and regional structures were inevitably much looser than in (say) Europe. But there was nevertheless a significant if gradual advance, across most of the region, in coherence and in sense of regional identity and community; and the prime unifying theme was economic growth, based on concepts of market economies, export-oriented, increasingly open and cooperative. The sense of economic momentum - even sometimes of pride in a perceived status as currently the world’s prime economic locomotive - mostly generated widespread confidence and optimism about the long term, even where (as in Japan) the momentum had temporarily flagged.

There were potential security concerns, including a considerable list of territorial disputes more apt for management than for solution; but for most countries security was not at present a prime worry. Given the region’s geography, the scope for successful military adventure was generally limited, though fears of it might sometimes weigh more heavily than the facts warranted. The two main security issues catching our attention were North Korea and Taiwan, with several though not all participants rating the former as the likelier cause of any serious conflagration. In North Korea a highly opaque regime, heavily armed and perhaps of uncertain rationality, faced grave economic and social problems. The US-led (but, importantly, multi-participant) Korean Economic Development Organisation seemed a useful instrument of engagement for relieving the situation’s stresses; it provided a window or communication channel for the regime towards the wider world, and it might be able progressively to help build within the peninsula the North/South dialogue hitherto impeded by deep prejudice and immobilism on both sides.

As we met, China’s actions in response to its perception of Taiwanese behaviour were sharply raising the political temperature in the Taiwan Strait. The prime Chinese concern, it appeared, was to have the status quo left disturbed, rather than to arrest internal political evolution in Taiwan or to seize some economic dividend. Some participants urged that developing Taiwanese public opinion was nevertheless a legitimate force which could not simply be ignored; an outcome was needed that allowed Taiwan some international “space” on its own account. We were left with a sense of needing to identify some imaginative constitutional framework (not the Hong Kong model, for the situation there was different) that might offer a more stable reconciliation of expectations now in severe tension.

The condition, attitudes and future of China within the region were naturally central themes throughout the conference. China’s fuller emergence into the world scene was a development of huge historic importance, but at least to outside observers wide uncertainties remained about direction and intention. In economic terms China was a unique and awkward combination of less-developed-country and colossus. China saw itself, despite some progress in lowering tariffs, as far from ready yet for full opening-up to world trade, with many industries at the “infant” stage and needing protection, and its agriculture in particular quite unable to withstand unrestrained competition. But China’s economy was even now so big that the world community - not just the United States, which was for the most part spokesman for concerns very widely shared - saw grave difficulty in admitting to the World Trade Organisation a China which would expect, in practice if not formally, massive and long-lasting dispensation from key WTO rules alongside ready access to the markets of others (in order to pay for imports such as oil needed to sustain the internally-generated growth which was the main engine of economic advance). We all recognised, in broad terms, the importance of dealing with China by positive engagement rather than by arm’s-length mistrust; but we found no consensus about what this should mean in respect of the timing (entry first, or bargain first?) of WTO participation.

We remained well aware that in strict economic terms Japan, for all its current pause, remained the region’s real colossus and its unavoidable leader (even if leadership was not deliberately sought) in many economic respects, as the weight of its overseas development assistance illustrated. Concern was briefly expressed about a rhetoric in Japan of “re-Asianisation”; historic scars might still occasionally constrain Japan’s options, but a confident, outward-looking, open-market, internationalist Japan, globally interested, was crucial to the region’s health. We were generally reassured on this score, especially against the background of clear recent reaffirmations, by both partners, of the strength and crucial value of the US/Japan security link; were that to falter, much in the Japanese stance and indeed more widely in the region would face uncomfortable questions.

For the foreseeable future the US was inevitably the third great actor in the region. Most of us were minded to dislike talk about balances of power, but US engagement was plainly seen as an irreplaceable force for regional stability and confidence, whether or not it was interpreted as a counter to particular threats. Successive US governments had shown no disposition to renounce the role, despite domestic political strains such as the tendency (largely unfounded) to scapegoat Japan in particular, and booming East Asia in general, for the discomforts of technology-driven economic change. It was plainly in the interest of the US (though not only of the US, and political burdens ought therefore to be more widely shared than at present) that the region should remain a peaceful and prosperous, and should continue to become a more open, market for trade worldwide. Some comment suggested that US business was still relatively under-involved, and that concern about trade balances was often both too much concerned with bilateral figures and also too little aware of the wide US advantage in “invisibles”, though the US was legitimately concerned about unfair disadvantage in such matters as intellectual property rights in the (very large) entertainment sector of its trade.

Our review of the various overlapping regional organisations for dialogue and cooperation was regularly reminded that the Asian approach should not be expected simply to mirror that of the West in such matters as international market-opening. The Western style typically sought very specific bargains, pinned down tightly in legal terms. The Asian style was readier to accept general direction of movement and the informal effects of peer pressure - and this was especially apt when, as we had noted at the outset, any regional structure had to be loose enough to cope with wide national diversity. Too much should not be expected too concretely too soon of the Asia-Pacific Economic Forum (APEC); its dividends - including notably those from the full admission and involvement of the US - would not be seen solely in events bearing an APEC label. The technique of advancing the spread of common and fair market conditions for trade by “concerted unilateral liberalisation” (for which Japan would have to be in the forefront) was likely, in the East Asian situation, to be a more effective way forward than attempts at highly-formal multilateral bargaining. The sceptics among us nevertheless pointed to the need, amid informality, for more dependable dispute-resolution mechanisms than yet existed; and doubt was voiced about whether the expressed target of a fully-free-trade area by 2010 for developed and by 2020 for all states yet had credible underpinning.

We surveyed other collaborative structures more briefly; indeed, we took the longest-established and most thriving - the Association of South-East Asia Nations (ASEAN) - as virtually a given, though we were aware that its expansion set important new tasks. We noted the new Asian Regional Forum (ARF) as a modest value-adder in the security field by way of better dialogue and transparency, though few of us thought it yet capable of bearing material weight in managing real conflicts of interest. The recent Asia-Europe meeting (ASEM) at summit level had been a useful earnest of and encouragement to the European involvement which many in the region itself keenly welcomed, though follow-through effort would be needed to sustain it. We mostly seemed relieved that the East Asia Economic Caucus (EAEC) concept - not wholly liked even with ASEAN - appeared likely to crystallise more as a mechanism for coordination within other organisations than an important free-standing operational grouping; though inter-regional commerce was growing fast, the region’s prime trade interest lay in free access further afield.

Our focus - matching that of East Asian leaderships themselves - upon economic issues left us little time for extended survey of other aspects such as internal political development. Here too diversity reigned, though economic convergence might gradually bring greater political homogeneity, whether through cross-national infection or as similar factors - like the long-term difficulty of sustaining liberal economic arrangements alongside illiberal political ones - yielded similar effects. To the surprise of a few participants, little concern was expressed about political stability within countries, though it was observed that one or two might before long face awkward problems of leadership succession. And the general optimism was predicated on an assumption that economic growth would suffer no grave checks; without that assumption, we knew, many sanguine political and social bets would be off.

Were there, we wondered, other pressures that might harm stability? In China and at least one or two other countries corruption was still a problem on a scale that might both threaten public confidence and damage economic advance; and the general rule of law - especially dependable commercial law - could not everywhere be counted upon, though improvement was evident and might well be accelerated both by the collective stimulus of deepening cooperation in trade and by the increasing influence of media freer and more outspoken than had been the norm in the past. Most countries however still lacked the weight of vigorous non-governmental institutions which the term “civil society” evoked in the West, and this accompanied (whether as symptom or as contributory cause) continuing problems - not merely in Western perceptions - about individual rights in large parts of the region. We heard that Asian custom typically accorded greater value to social well-being than to individual dignity, and we recognised that over-strident pressure horn outside the region might be neither justified nor productive; but most of us nevertheless believed that developmental diversity or cultural difference should not be allowed permanently to excuse shortcomings against universal core standards.             

We could touch only glancingly upon environmental concerns - mostly accorded at present lower priority in the region than in the developed West, and particularly worrying in China - and upon the impact of demography. We noted very uneven performance in managing the massive rural-to-urban shifts of population that marked several countries; this sort of migration, we understood, was in practice a bigger issue for most than inter-state movement, at least while economies prospered. Age balance within total population was severe concern in Japan, but not generally elsewhere - most of the region’s countries had young populations, and the priority concern was therefore employment rather than welfare support.

The breadth of our canvas inevitably defeated us in some respects; we could give little time to the special relationship (undoubtedly deepening) of Australia and New Zealand with the region, and we registered only briefly - though clearly - the fact that Russia, albeit weakened and distracted for the time being, had both interests and influence in the long run. We touched scarcely at all on the possible impact of religion, or upon what political role the region’s countries might come collectively to play in a global context as their capability and concerns widened beyond the economic sphere. Our discussions almost throughout had been marked by a general optimism about the region’s developing advance; if that optimism proved well-founded, we recognised, the world’s political centre of gravity would inexorably shift accordingly.

This report reflects the Director’s personal impressions of the conference. No participant is in any way committed to its content or expression.

Chairman : Lord Gillmore of Thamesfield, GCMG
Lately Permanent Under-Secretary of State, Foreign and Commonwealth Office (FCO)


Mr Michael Cook AO
Ambassador to the USA (1989-93)
Mr Rawdon Dalrymple AO
Chair, ASEAN Focus Group; Ambassador to Japan (1989-93)

Sir John Boyd KCMG
Ambassador to Japan (1992-96)
Admiral Sir James Eberle GCB
Formerly Director, Royal Institute of International Affairs
Mr Christopher Everett CBE
Director-General and Secretary, Daiwa Anglo-Japanese Foundation
Mr Graham Fry
Assistant Under-Secretary of State, Northern Asia and the Pacific, FCO
Mr Richard Grant
Head, Asia-Pacific Programmes, Royal Institute of International Affairs
Dr Timothy Huxley
Director, Centre for South-East Asian Studies, University of Hull
The Rt Hon Sir Michael Palliser GCMG
Formerly Permanent Under-Secretary of State, FCO
Mr Gideon Rachman
Asia Editor, The Economist
Dr Gerald Segal
Senior Fellow, Asian Security Studies, International Institute for Strategic Studies

Mr Thomas E Armstrong QC
Counsel, McCarthy Tetrault, Toronto

Ambassador Cheng Ruisheng
Deputy Director-General, China Center for International Studies
Dr Lu Jianren
Assistant Director, Institute of Asia-Pacific Studies, Chinese Academy of Social Sciences, Beijing

Dr Nicolas Chapuis
Deputy Director (East Asia), Ministry of Foreign Affairs

HE Hiroaki Fujii
Ambassador of Japan to the Court of St James’s 
Mr Akira Kojima
Deputy Editorial Editor, Nihon Keizai Shimbun (NIKKEI)
Mr Ryn Yamazaki
Deputy Director-General, Foreign Policy Bureau, Ministry of Foreign Affairs
Professor Ippei Yamazawa
Professor, Hitotsabashi University

Ms Anne Blackburn
ING Barings, London
Mr Michael Powles
Deputy Secretary, Ministry of Foreign Affairs and Trade

Mr Yevgeny Afanasiev
Director, First Asia Department, Ministry of Foreign Affairs          

Professor Lee Lai To
Professor of Political Science, National University of Singapore

The Hon Douglas Bereuter
Chairman, Asia and Pacific Subcommittee, House of Representatives International Relations Committee
The Hon Stephen Bosworth
President, United States-Japan Foundation
Professor Lawrence Lau
Professor of Economic Development and Co-Director, Asia/Pacific Research Center, Stanford University
Mr Herbert Levin
Executive Director, America-China Society
The Hon Joseph S Nye, Jr
Dean, John F Kennedy School of Government, Harvard University; Assistant Secretary of Defense for International Security Affairs (1994-95)
Mr Stephen Parker
Chief Economist, The Asia Foundation
Mr Stanley O Roth
Director of Research and Studies, US Institute of Peace
The Hon Helmut Sonnenfeldt
Guest Scholar, Brookings Institution
Dr Alfred D Wilhelm, Jr
Director, Atlantic and Pacific Interrelationships Program, Atlantic Council of the United States

HE Mr Vu Khoan
Deputy  Minister for Foreign Affairs