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AseanAffairs Magazine September - October 2010

Thai Prime Minister
Abhisit Vejjajiva

Four months on in the reconciliation process Asean Affairs examines the progress and shortcomings of Prime Minister Abhisit Vejjajiva’s plan to bridge

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China’s Xiaowan Dam, the world’s tallest, may serverely impact downriver countries.


 Chinese Ambassador to Thailand, Guan Mu was born in Jilin in northeastern China, in 1952. He graduated from Beijing University in 1974 with a bachelor’s degree majoring in the Thai language and joined the foreign service in 1974. At the time he graduated, China’s diplomatic relations with the rest of the world were developing rapidly. As a fluent Thai speaker, he served at the Chinese embassy in Bangkok three times in various capacities from 1977 to 1999. Guan Mu served as the minister counselor at the Chinese embassy in Singapore for three years. Before being appointed ambassador to Thailand in the spring of 2009, he was deputy director-general of Asian Affairs at the Ministry of Foreign Affairs in Beijing.

Q: There is still apprehension in Southeast Asian countries about China’s military modernization. They say that it would be helpful if China were more transparent, without revealing military secrets, about this. Is that possible?

A: China’s strategic intentions and military capacity are transparent all the time. China’s efforts to enhance military transparency are obvious. China has issued defense white papers, established a defense spokesperson system, and opened the National Defense Ministry website. China has also promoted military exchanges and dialogues with other countries, including Southeast Asian countries. In 2007, China precipitated the United Nations Transparency Mechanism and resumed providing requested data for the UN Register of Conventional Arms.

China unswervingly follows the path of peaceful development and pursues a national defense policy which is purely defensive in nature. Now or in the future, no matter how developed it becomes, China will never seek hegemony or engage in military expansion.

Both the total amount and per-serviceperson share of China’s defense expenditure remain lower than those of some major powers. In 2007, China’s defense expenditure equaled 7.51 percent of that of the United States, 62.43 percent of that of the United Kingdom. China’s defense expenses per service person amounted to 4.49 percent of that of the United States, 11.3 percent of that of Japan, 5.31 percent of that of the United Kingdom, 15.76 percent of that of France, and 14.33 percent of that of Germany.

As for the share of defense expenditure in GDP, that of China was merely 1.38 percent, while that of the United States was 4.5 percent, that of the United Kingdom 2.7 percent, and that of France 1.92 percent.

In recent years, China and Southeast Asian countries have advanced remarkably in military exchanges and cooperation. The two sides frequently exchange military visits and carry out joint military exercises and training.


Q: Recently the Philippines called for a Code of Conduct in the South China Sea to reduce tensions between China and the several Asean nations that have claims in the area. What are the chances for settlement along these lines through negotiation?

A: First, I would like to point out that since the end of the eighth century and the beginning of the ninth century, the Nansha Islands have been included in Chinese territory, and jurisdiction has been continuously exercised over these islands. From the beginning of the 20th century, the Chinese Government has taken measures to maintain sovereignty over these islands, which has been widely recognized by the international community. For quite a long period of time after World War II, there had been no such a thing as the so-called issue of the South China Sea. No country in the area surrounding the South China Sea had challenged China’s exercise of sovereignty over the Nansha Islands and their adjacent waters. In the 1960s and 1970s, some countries began the claims of sovereignty over some or all of the Nansha Islands. The above-said facts prove that the disputes in the South China Sea emerged only several decades ago and that China has indisputable sovereignty over the Nansha islands and their adjacent waters, which has sufficient historical and legal basis.

H.E.Guan Mu, Chinese ambassador to Thailand

As is known, China peruses to solve the disputes on territory sovereignty and maritime rights and interests of the South China Sea through negotiation. Before the solution of disputes, China stands ready to conduct dialogues with concerned parties to jointly keep peace and stability in the South China Sea.

There is a consensus that these disputes should be solved peacefully through friendly consultations in the interest of peace and stability in the South China Sea and good-neighborly relations. The function of Declaration on the Conduct of Parties in the South China Sea (DOC) is to enhance mutual trust among the countries concerned and to create favorable conditions and good atmosphere for final solution to the disputes. According to DOC, it is to exercise restraint and not to make it an international issue or multilateral issue. Since DOC was signed, China has kept its commitments and exercised great restraint.

However, some countries continuously take actions against the spirit of DOC, making the issue of the South China Sea more complicated. China will persist in solving the issue through bilateral negotiation and dialogue. There are channels of negotiations and consultations, and they are open and smooth.

Q: With water levels of the Mekong River falling to an all-time low, there is growing concern about China’s plan to continue building three more dams on the river and bringing a fourth online soon. China has assured the other members of the Mekong River Subregion that the lack of water in the drawdown of the Mekong River has nothing to do with China’s hydropower development of Lancang River. However, apprehensions still remain. Your response to this issue?

A: China and the countries along the Mekong River are good neighbors. Rational harnessing the water resources of the Mekong River is in the interests of all countries in the Great Mekong Sub-region. While harnessing the water resources of the Lancang River, China takes seriously into consideration the impact on the environment, ecology and natural resources and takes care of the concerns of the lower-reach countries in an active manner and keeps smooth communication with them. As a responsible upper-reach country, China will never do things that harm the interests of the lower-reach countries.

On utilization of the water resources of the Mekong River, China and the Mekong River Commission (MRC) have established mature and effective dialogue channels through the Dialogue Meeting with MRC and conducted a series of pragmatic cooperation. Since 2002, China has been providing the MRC Secretariat with hydrological data in the flood season. In order to facilitate drought disaster relief of the downstream countries on the Mekong River and demonstrate China’s sincerity in jointly dealing with the severe drought, China has provided the MRC Secretariat with hydrological data from Chinese hydro-meteorological stations in this severe drought season as an emergency response.

China stands ready to strengthen communication and coordination with the parties concerned on the basis of equal consultation and mutual benefit and jointly promotes the social and economic development of this region.

A view of the massive power plant 4 at the Xiowan dam project.

Q: Southeast Asia is an important area for China’s new economic diplomacy and a test case for Beijing’s credibility as a responsible stakeholder as well. Do you agree?

A: China and Southeast Asian countries are friendly neighbors and important strategic partners, which are geographically close, culturally similar and economically complementary. To develop the friendly cooperation between China and Southeast Asian countries, which is one of China’s consistent policies, meets the interests of both sides and is beneficial to regional peace, stability and prosperity.

The economic integration between China and Southeast Asian countries is growing, and bilateral trade is steadily increasing. The completion of China-Asean FTA this year has provided a more free, facilitated and harmonious trade environment and a solid basis for further cooperation.

 Q: How is the Asean-China Free Trade Agreement working out? Do you have the latest figures?

A: The China-Asean Free Trade Area (CAFTA) went into broad effect on January 1 this year. Under CAFTA, a zero-tariff rate is applied to 91.5 percent of goods from Asean member countries, and the average tariff was reduced by China from 9.8 percent to 0.1 percent. Bilateral trade in services will be further expanded. Investment policies and environment will become more stable and transparent thanks to improved legislation by both China and Asean members. Free trade has almost been realized between China and Asean countries, which will improve the efficiency of mobilizing production factors including capital, resources, technology and human resources.

Since the implementation of CAFTA, faster growth in bilateral trade and investment, deeper economic integration, and mutual benefits to enterprises and individuals have been observed. Driven by the free trade pact, trade grew at an annual rate of more than 30 percent from 2003 to 2007, and continued to grow at 3 percent from 2008 to 2009 despite the global financial crisis. In the first half of 2010, bilateral trade reached $136.5 billion, a year-on-year increase of 55 percent, while China’s imports from Asean hit $71.9 billion, a 64 percent increase from the same period last year, and exports to Asean were at $64.6 billion, a 45 percent increase compared with that of last year................


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