South China Morning Post

By Shen Dingli

China is a rapidly rising power. Its confidence is up after a continuous decade of spectacular economic growth. During the eight years of the Bush administration, its economic output quadrupled. Today, it is the world's No 2 trading country and the world's No 1 exporter. It possesses the largest foreign currency reserves in the world. In the aftermath of the global financial crisis, which saw the US economy fall back, China sees a strategic opportunity to extend its lead.

After three decades of economic development at home, China is shifting its hitherto low-key strategy of expanding its interests and asserting its diplomatic influence abroad. All of this will have profound implications for the region.

As China's interests expand overseas, it will continue to strengthen its military to protect these interests. There is a debate going on now about whether China should develop supply lines for its navy or establish naval bases overseas. Although the government is approaching this issue cautiously, there is no question it's an issue China will have to address at some stage. Such a development would be based on three criteria: to protect China's legitimate interests; to further the interests of the host country; and to enhance regional and international stability.

The idea of an overseas Chinese naval base and the growth of its military strength shouldn't alarm the world. Instead, it should be viewed as a source of regional stability. China's defence spending has been growing in recent decades. The latest defence budget of the People's Liberation Army has reached US$78 billion, only 11 per cent of the United States'.

But the PLA budget has maintained a double-digit percentage increase for nearly two decades. If it can sustain this trend for several more years, it could increase to US$300 billion - on a par with that of the US in 2000. By the late 2010s, with purchasing power parity taken into consideration, China's defence spending could match what the US spent in 2008.

As a result of this spending rise, the PLA is becoming more modern and professional. It can now execute an inter-continental nuclear strike. In addition, China is modernising the sea-launched leg of its nuclear triad.

While conventional missiles constitute China's backbone force (with the capacity for both anti-ship and anti-ballistic missile interception), it is also developing a space programme. Currently, it is deploying the Compass (beidou) navigation and guidance system, and has already demonstrated an anti-satellite warfare capacity. Meanwhile, the world is watching as China develops its blue-water navy and information warfare capabilities.

China's economic and defence spending is complemented by its investment in education, science and technology. Over the past three decades, China has doubled its number of universities and colleges, from 1,000 to over 2,000. At any given time, China has more than 30 million students attending institutions of higher learning. The government has plans to increase higher-education participation to 40 per cent of its young people in 2020 and 80 per cent by 2050. This would make it an education powerhouse.

As China has risen, so has its international standing and influence. China has played a vital role in stabilising the world economy in the aftermath of the global financial crisis of 2008-09. It has hosted all six-party talks on North Korea's nuclear weapons programme. Among the permanent five countries of the United Nations Security Council, China has contributed the most peacekeepers to UN missions.

Within three hours of the recent earthquake in Haiti - a country with which Beijing has no official diplomatic relationship - a Chinese rescue team was airborne on its way to Port-au-Prince.

For better or for worse, China is becoming a crucial actor in world affairs. For example, it was Chinese pressure that succeeded in persuading the Sudanese leadership to allow African Union troops into Darfur to act as a peacekeeping force. In Myanmar, China has continued to advise the military government to keep its doors open to the outside world. At the UN Climate Change Summit in Copenhagen last year, Beijing and Washington's failure to find a mutually acceptable agreement on carbon dioxide emissions led to the disappointing outcome, illustrating how crucial China's role in international affairs has become.

Even as China is playing a greater role in world affairs, the international community is expecting it to shoulder a greater share of responsibility, one that is commensurate with its growing power and clout. China is expected to do more to maintain security and trade in the region and beyond. In the area of nuclear proliferation, China is expected to use its traditional links with Pyongyang and Tehran to help moderate their nuclear ambitions. Even in the pirate-infested Gulf of Aden, Chinese naval fleets are keeping the sea lanes free from piracy.

What the world expects of China is also what the nation expects of itself. It wants to be seen as a responsible actor on the international stage and has initiated and implemented policies to help stabilise regional crises in Northeast Asia, South Asia, Central Asia and the Middle East.

At the same time, China is conscious that it is still a poor country that requires resources to maintain economic development at home. As a result, it has to strike a balance of responsibilities: responsibility for internal development as well as the international order.

Shen Dingli is executive dean of the Institute of International Studies and director of the Centre for American Studies at Fudan University in Shanghai. This is an extract from his essay in the latest edition of American Review, published by the US Studies Centre at the University of Sydney.