THE RISE OF CHINA AND SECURITY IMPLICATION IN THE CONTEMPORARY ASIA PACIFIC

THE RISE OF CHINA AND SECURITY
IMPLICATION IN THE CONTEMPORARY ASIA
PACIFIC

COVER

AN UNDERGRADUATE THESIS

Arranged by:
M. Rilo Mildi Pambudi
20120510425

INTERNATIONAL PROGRAM OF INTERNATIONAL RELATIONS

FACULTY OF SOCIAL AND POLITICAL SCIENCES
UNIVERSITAS MUHAMMADIYAH YOGYAKARTA
2016

TABLE OF CONTENT

COVER ...........................................................................................................

i

AN UNDERGRADUATE THESIS ................................................................

ii

ENDORSEMENT PAGE ...............................................................................

iii

STATEMENT OF ORIGINALITY ................................................................

iv

QUOTATION .................................................................................................

v

ACKNOWLEDGEMENT .............................................................................

vi

THANKS TO ..................................................................................................

vii

ABSTRACT ....................................................................................................

viii

TABLE OF CONTENT ..................................................................................

ix

TABLE OF FIGURE ......................................................................................

xi

CHAPTER I. INTRODUCTION

1.1 Background ...............................................................................................

1

1.2 Research Question ......................................................................................

5

1.3 Theoretical Framework .............................................................................
1.3.1 The Concept of Foreign Policy .........................................................

6
7

1.3.2 The Concept of National Interest .....................................................

9

1.4 Hypothesis .................................................................................................

11

1.5 Purposes of writing ...................................................................................

12

1.6 Method of Writing .....................................................................................

12

1.7 Research Area ...........................................................................................

13

1.8 Organization of Writing ............................................................................

13

CHAPTER II. THE RISE OF CHINA: THE HISTORY AND SERIES OF
HIGHLIGHTED EVENTS

2.1. China Massive Development: From Mao’s Military
Modernization to Deng’s Reform in the Twentieth-Century ..................

16

2.2. Four Modernization: China’s New Form of Military Modernization ......

22

ix

CHAPTER III. THE GROWING IMPORTANCE OF CHINA IN ASIAPACIFIC AND THE SHIFTING REGIONAL ORDER AMIDST THE RISE
OF CHINA
3.1. Alliances and Partnership: The United States Commitment
in Asia-Pacific ..........................................................................................

30

3.2. China’s Offensive Military Development and
The Changing Regional Order ..................................................................

38

CHAPTER IV. THE NATIONAL INTEREST BEHIND CHINA’S ACTIVE
ENGAGEMENT IN CONTEMPORARY ASIA-PACIFIC
4.1. China Balance of Power and Strategic Partnership in Asia-Pacific .........

47

4.2. China’s Participation in Territorial Disputes of the South China Sea
And the East China Sea .............................................................................

51

CHAPTER V.
CONCLUSION ................................................................................................

57

REFERENCES ................................................................................................

60

x

TABLE OF FIGURE
Picture 3.1 : The Map of Asia Pacific Region ................................................

28

Picture 3.2 : The PLARF Missile Range .........................................................

44

xi

ABSTRACT
The rise of China has been predicted by the scholars and policymakers since a
long time ago, that the tensions in the world of politics will shift, and there is no longer
rivalry among the major power centralized in the West. A significant force, which is

growing and developing in Asia-Pacific, has a huge potential towards political and
military rivalry. Not only that, the pattern of dependency between the West and Asian
states also changed- the support and assistance of the United States is no longer be the
most coveted, on the contrary the United States depends on the continuation of
cooperation with the Asia-Pacific states to ensure its influence in the region. China has
proven to possess an unusual growth pattern and survivability outperforming other states
that suffer the same underdevelopment as a result of the foregone Westernization. The
following dramatic changes in economic system in 1980s, has offered greater
opportunities to foreign investments on a large scale Furthermore, in the twenty-first
century, China eventually overtook the role of the United States and European countries
as the major trading partner for Asia, Africa, and Latin America.
The initial idea in choosing this topic of research is derived from author’s high
interest in the highly debated discourse of the ‘Rise of China' or massive development of
China in twentieth-century, where China holds a significant role in both regional and
global contemporary politics nowadays. The rising debate of perspectives and speculation
are varying in nature about China’s political, economic and military activities in regional
level, while there is only limited and often bias in-depth study regarding so, encouraged
the author to conduct a more comprehensive research to wrap the phenomenon and
analyse its implication to regional and global stage.
Keywords: The rise of China, Asia-Pacific, economic reform, military modernization,

national interest, South China Sea, East Asia Sea, ripe for rivalry.

viii

CHAPTER I
INTRODUCTION

1.1. Background
Post-Cold War there was an inevitable creation of world’s situations in
which the world at that time was centralized mainly toward certain countries
involved in the war, such as the United States (US) and the Soviet Union. Not
merely in the political and economic issue, the civilization in a significant level
was also centralized in the European state system. In the midst of massive
domination of both rivalry countries in the early 1990s, the collapse of Soviet
Union eventually led the United States to become the sole hegemony throughout
the world followed by the rise of the liberal victory as the only concept applied in
the global affairs.1 As the United States in almost 20 years has defined the feature
of world affairs, the world has become more and more dependent toward the
supply, donors and political support from the United States, especially the
developing and third world countries.

Asia as a region that is growing by maintaining the form of alliances and
cooperation with the United States, in a few decades, has undergone profound
changes in its international affairs. The influence of the United States in the region
began to fade due to several important events that occurred gradually, such as the
rapid growth of regional multinational institutions, the influence of the
Association of Southeast Asian Nation (ASEAN), increased economic
interdependence throughout the region, outstanding growth of Asian countries
includes the economic miracle that China performed after the successful reforms

1

Francis Fukuyama, The End of History and the Last Man (1st edn, Free Press 1992).

1

in 1978.2These have also contributed to the alteration of structure of power and
the nature of regional system including the security issue throughout the AsiaPacific.
This setting of international affairs has long been predicted by the scholars
and policymakers, that the tensions in the world of politics will shift and there is
no longer rivalry among the major power centralized in the West. A significant

force, which is growing and developing in Asia-Pacific, has a huge potential
towards political and military rivalry. Not only that, the pattern of dependency
between the West and Asian states is also changing—the support and assistance of
the United States is no longer be the most coveted one. On the contrary, the
United States increasingly dependent on the continuation of partnership with the
many countries in Asia-Pacific to ensure its influence in the region. Meanwhile,
China has been proven to pose an unusual growth pattern and survivability
outperforming other states that suffer similar underdevelopment as a result of the
foregone Westernization. Therefore, an assumption began emerge that Americans
continuous engagement in the region is no other than to lessen the excessive
power of China, which according to American policy makers is challenging the
United States security commitment in the region.
The world could be ruled out of the Eastern world for a while. However,
from the successful economic reform and trade liberalization in 1978, China
gradually emplaces itself on the right catch-up growth trajectory of an economic
superpower and become more integrated into the world politics and economics.
Following the event, a dramatic change in the economic system in the 1980s,
continued to offer a greater opportunity to foreign investments on a large scale. In
2

David Shambaugh, 'China Engages Asia: Reshaping The Regional Order' (2005) 29 International
Security.

2

the twenty-first century, China eventually overtook the role of the United States
and European countries as the major trading partner for Asia, Africa, and Latin
America- The data from World Development Indicators-World Bank (2013)
shows that China’s manufactured goods account for over 90 percent of all
exported goods of the country.3This has a considerable impact on China's GDP in
a bigger picture. According to another data from World Development IndicatorsWorld Bank (2013), China managed to maintain the good trajectory of its GDP
growth since 1978 faster than any other nation in the world. In 1984 the growth
rate of the world economy is around 4.5 percent, of which less than 0.25 percent
due to China, while China's growth rate jumped up 15 percent as the highest in the
period 1978 to 2011.4 This accomplishment indicates that contribution of China to
the world GDP growth remains positive and increasingly important since the
1990s.5 As confirmed by the economist, inefficiencies and incoherence remain in
the annals of China's development to date. China has stumbled upon its priority,
the state-owned enterprises (SOEs) that the regime resisted to privatize, is proven
corrupt and inefficient.6In 2013, the economic growth has slowed to 7.5 percent
from its earlier double-digit pace.7Nevertheless, there is more substance than
water in China’s miraculous economic development. Until now China remains the
highlight of economic prosperity in both regional and global levels.

The World Bank, ‘World Development Indicators-China’s Export Structure’ (The World Bank,
2013), cited in Li Yang, ‘China’s Growth Miracle: Past, Present, and Future’ (Professor, Chinese
Academy of Social Sciences, p. 8.
4
The World Bank, ‘World Development Indicators - China’s contribution to world GDP growth
(%)’ (The World Bank, 2013), cited in Li Yang, ‘China’s Growth Miracle: Past, Present, and
Future’ (Professor, Chinese Academy of Social Sciences, p. 3.
5
Li Yang, ‘China’s Growth Miracle,’ p. 3 (footnote 4).
6
The Economist, 'A Bubble in Pessimism' (The Economist, 2013)
accessed 21 December 2016.
7
ibid.
3

3

The rapid economy development flames the military modernization to
appear as an appendage of such extraordinary growth. Earlier in 1990s China
began to adopted technological measures to modernize the PLA contributed to
defense budgetary increase from approximately $9 billion double up to $17 billion
in 2000 and reaching $35.6 billion in 2005.8 Later China’s defense spending rose
to 8.3 percent between 2011 and 2012 contributed to Asia total increase of 4.94
percent in the same years.9 China rise from modernizing military to the second
largest defense spender in the world, which also means the more advanced
military sector.10Furthermore, China’s aggressive military activities in South
China Sea and East China Sea indicate that China is steadily expanding its
geopolitical role in the Pacific, which later give rise to intensifying military sector
of other emerging power in Asia,11 one example to best depicting this situation,
when China’s assertive confrontation in South China Sea aggravate the tension
between China and other claimant states and the United States. In 2013 China
began the land reclamation at it outpost in South China Sea, turned the submerged
reefs into islands and equipped them with military system. As the responses
Philippines and Japan take a more serious action by joining the United States in
maritime air patrol over the sea.12Furthermore, a security agreement between the

Bhartendu K. Singh, ‘The Political Economy of China’s Defense Modernization’ (2005) 29
Strategic Analysis, p. 688, available at
accessed 5 November 2016.
9
Myra MacDonald, 'Asia's Defense Spending Overtakes Europe's: IISS' (Reuters, 2013)
accessed 5
November 2016.
10
ibid.
11
Anthony H. Cordesman, 'Chinese Strategy and Military Modernization: A Comparative Analysis'
(Centre for Strategic and International Studies 2015) accessed 8 November 2016.
12
David Alexander, 'U.S. Hopes Chinese Island-Building Will Spur Asian Response' (Reuters,
2015)
accessed 26 December 2016.
8

4

United States and the treaty allies, Philippines and Japan, has been updated in
regard with the occurrence –The United States seeking the placement of navy
ships within 12 miles (19 kms) of the Chinese-built islands, while in the future the
allies target to have 60 percent of Navy ship oriented toward the Pacific by
2020.13
Many scholars perceived this phenomenon as a meaningful occurrence – as
the challenges the phenomenon has offered for granted hold an image of
ambiguity to the contemporary regional order. There will always be a high
probability for the more intensified military competition in the future following
the extensive military modernization and how states afterwards interpreted the
phenomenon differently while they started to engage in defensive agenda to
address the possibility that could arise in the future.14There will always be
supposition and speculation about the true motives behind China's active
engagement in the region. Therefore, this paper seeks to analyze the phenomena
in regional Asia-Pacific amidst the rise of China. Further elaboration on the
factors that may leads to China becoming more and more active in the region—
since not only has the phenomenon exacerbated the uncertainties in contemporary
global politics, but the rise of China in both economic and military development
also succeeds to increase the instability, political friction, and mistrust within the
regional level of Asia-Pacific.

1.2. Research Questions
What factors lead to China becoming more active in the contemporary AsiaPacific?
13

ibid.
ibid.

14

5

1.3. Theoretical Framework
In this paper, two different sets of theoretical concepts are to be discussed,
to understand certain phenomena that occur in regional Asia-Pacific following the
rise of China, the phenomena then being analyzed from the lenses of the foreign
policy concept and the concept of national interest from realism perspective. The
two concepts are rather different but are not necessarily challenging each other, in
fact, the two concepts assisting each other where the existence of one concept
serves as the basis for the other concepts, vice versa, and one concept into a final
form of the other concepts. Therefore, the two theories will be combined as a
foundation in analyzing the phenomena arises from the rise of China.
To begin with, it is important to remember that all perspective in
international relations contain statement about foreign policy.15This has been the
case, just as how the Realist takes, almost all approaches put state as the central
actor. In realist world, states are the utmost actor above all- hence, the fulfillment
of state interest is primary, despite the rationale behind the intention. Hans J.
Morgenthau described the activities and political action of a state, is seen as
directed to keeping, increasing and demonstrating.16 In other words, the three
behavioral patterns could be translated into policies of status quo, imperialism and
prestige – to maintain the balance of power, to acquire more power and to show
off strength in order to keep expand power.17 In the end, the struggle for power is
the ultimate goal that is rooted in the existence of the state, indefinite and
timeless. Morgenthau conceived of interest and power as individuals’ nature, to
15

Theories of foreign policy: an historical overview
J. Peter Pham, 'What is in The National Interest? Hans Morgenthau's Realist Vision and
American Foreign Policy' (2008) 30 American Foreign Policy Interests, p. 258.
17
ibid.
16

6

live, to propagate and to dominate, and an incessant struggle over power among
states, arising from the desire for power or animus-dominandi that deliver the idea
that it natural human urge to dominate other.18 For the sake of national interest,
individual has to possess more than just rationalities and resoluteness in
determining the best policy for the country. However, the end does not necessarily
has to be security, in developing foreign policy states could pursue two things,
change and maintenance—to change the condition of status quo in international
politics and to maintain condition that are preferable to their interest.19From this
point, both national interest and foreign policy can be used as a conceptual
framework for analysis and decision making of a state. In sum, to maintain and
achieve the national interest that later reflected in its foreign policy, is at the heart
of all politics. Hence in the international stage, it behooved state to pursue its
international interest as the embodiment of strength they have.20

1.3.1 The Concept of Foreign Policy
Foreign policy as a concept often interpreted differently by scholars and
philosophers. Yet, from how the concept is being analyzed in its dimension and
kinds to the process of foreign policy, all findings lead to a perception that
country formulate their foreign policy to secure their interest. 21 Foreign policy is a
behavioral pattern, adopted by states to conduct foreign and diplomatic relations

18

Hans J Morgenthau, Politics Among Nations (7th edn, McGraw-Hill 2005), pp. 36-37, cited in
Michal Parizek, 'Evil Human Nature as a Necessary Assumption of the Neorealist View on
International Politics' (E-International Relations, 2008), available at http://www.eir.info/2008/03/03/evil-human-nature-as-a-necessary-assumption-of-neorealist-view-oninternational-politics/ accessed on 7 October 2016.
19
Glenn Palmer and T. Clifton Morgan, A Theory of Foreign Policy (1st edn, Princeton University
Press 2006), p. 7.
20
Pham, 'What Is in The National Interest? p. 258
21
Sadia Mushtaq and Ishtiaq Ahmad Choudhry, 'Conceptualization of Foreign Policy an Analytical
Analysis' (2013) 3 Berkeley Journal of Social Science, p. 1.

7

with other states –and is formulated according to state best interest.22 William
Wallace (1971) perceived the foreign policy as
a stable set of attitude towards the international environment, an implicit
or explicit plan about a country’s relationship with outside world”.23
In the world of anarchy, states establish its foreign policies conform with the
international environment, including the aim to influence the behavior of other
states to act as his will. The basic and most vital interest of states are always
static, like defense and security concern, yet the methodologies and strategies to
achieve the interest is dynamic as they developed to focus and refocused in a
changed environment.24 States may compromise the secondary interest but the
most vital interest cannot be bargained out, or else the in-charge policymakers
may betray the national sovereignty.25Therefore, to consider the internal and
external environmental factors in the formulation of policy is important for
policymakers. As matter of fact, the external factors may change the nature of
foreign policy, either states has to act in a positive of negative manner, hence, it is
suggested that a foreign policy should be a synthesis of national interest and state
interest.26
Accordingly, the use of foreign policy in this research paper is understood
as a concept that would very-well explain the reasons behind China’s active
engagement in the contemporary Asia-Pacific. One could argue, China through its
active foreign policy intended to counter-balancing the existing influence and
domination of the United States in the region. But behind the foreign policy

22

ibid., p. 2.
William Wallace, Foreign Policy and The Political Process (1st edn, Macmillan 1971). p. 11.
24
Sadia Mushtaq and Ishtiaq Ahmad Choudhry, 'Conceptualization of Foreign Policy,’ p. 5
(footnote 21).
25
ibid., p. 6
26
ibid.

23

8

outlined in the establishment of new form of independent regional partnerships,
without including the United States, lay an intention of more than just counterbalancing but to replace the United States in the region. Therefore, China aims to
confiscate the position as the region's supreme power, allows China to launch
certain-controversial national interest, including those interests in regard to
territorial claims in the South China Sea and East China Sea. The intention is
often correlated with China's efforts to restore the past glory.

1.3.2 The Concept of National Interest (Raison d’état)
The concept of national interest is the realist foundation in the explanation
of the politics in international relations. The concept also is the main foundation
of foreign policy concept. National interest was first applied and introduced to the
public by an Italian historian renaissance, Niccolò Machiavellian in his
controversial treatise, the prince, in the Sixteenth century. The approach of
national interest justifying the state's goal and ambitions pursued through any
political and diplomatic action, which otherwise could be disgraceful. Afterward,
the term was progressively being found utilized by the statesmen and scholars to
describe the aspirations and goals of sovereign entities in an international arena.27
The concept later, explicitly stated in many of unofficial publications and official
doctrines to describe the position of the country and, therefore, important for the
interest to be more predictable to the world.
According to Morgenthau (1949), the contest between national interest and
moral principles has been attempted for domination over minds and action of men
– these doctrines has profoundly influenced the conduct of foreign affairs since
27

Donald E. Nuechterlein, 'National Interests and Foreign Policy: A Conceptual Framework for
Analysis and Decision-Making' (1976) 2 British Journal of International Studies, p. 246.

9

the beginning.28 Accordingly, the very realist ground of national interest perceives
that the idealistic vision of moral principles embodied in the idea of common
security as it ought to deter the use of excessive violence is, therefore, weak and
ineffective. This belief serves to explain how then the League of Nations with
similar idealistic vision failed in preventing the outbreak of World War II. The
Americans apparently did not find, to deter others from the use of force, is in its
national interest.
Remember always that it is not only a political necessity but also a moral
duty for a nation to always follow in its dealings with other nations but one
guiding star, one standard for thought, one rule for action: The National
Interest."29
The concept has been extensively employed by the Americans statesman since the
establishment of the constitution, yet the American emphasized the national
interest only to the extent that can provide immediate economic gains to the
country or directly affect its security.30
Although the approach has been criticized for the absence of moral dignity
in its overall concept or the accusation that the pursuit of the national interest is
based merely on material considerations of power, it remains popular applied in
the European politics during the nineteenth century. In the face of the criticism,
Morgenthau refuses by confirms that there is a certain degree of restraint which
morally imposes upon the action of states, sometimes stricter, it simply interdicts

28

Ken Kiyono, 'A Study on The Concept Of The National Interest Of Hans J. Morgenthau: As The
Standard Of American Foreign Policy' (1969) 49 経営と経済 accessed 23 December 2016, p.
6.
29
J. Peter Pham, 'What is in the National Interest? Hans Morgenthau's Realist Vision and American
Foreign Policy' (2008) 30 American Foreign Policy Interests, p. 8.
30
Beard, Charles A. 1934 The Idea of National Interest: An Analytical Study in American Foreign
Policy. New York: Macmillan, p. 26.

10

an action or policies to be taken – even if it means another cost for a country to
bear.
There is a 'misconception, usually associated with the general depreciation
and moral condemnation of power politics…Yet, if we ask ourselves what
statesmen and diplomats are capable of doing to further the power
objectives of their respective nations and what they actually do, we realize
that they do less than they probably could and less than they actually did in
other periods of history. They refuse to consider certain ends and to use
certain means… not because in the light of expediency they appear
impractical or unwise,· but because certain moral rules interpose an absolute
barrier.31
After decades elapsed, the concept has grown its importance as a tool to assess
and describe the policies of the nation. One of them is to analyze the popular
contemporary phenomenon of the twentieth century, the rise of China and the
growing importance of China in the Asia-Pacific following the power shift from
West to East.

1.4. Hypothesis
Applying the concept of foreign policy and the national interest or raison
d’état as the basic approaches in analyzing the discourse of China rising power,
the authors forming multiple frames of the discussion as an initial hypothesis in
answering the problem formulation what factors lead to China becoming more
active in the contemporary Asia-Pacific?
1.

China aims to counter-balance the power of the United States in Asia-

Pacific to further becoming a great power in the region;
2.

China aims to strengthen and secure its position in territorial disputes in the

South China Sea and the East China Sea.

Ken Kiyono, 'A Study on The Concept of the National Interest,’ p. 16 (footnote 28).

31

11

1.5. Purposes of Writing
This research paper aims to analyze numbers of phenomena that occur
following the rise of China. Upon the accomplishment of this research, the author
expects to have both academic and practical contributions:
1. Academically, it can be used as an alternative resource to help the
researchers in analyzing the certain phenomena that occur from the
contemporary rise of China;
2. Practically, it can be used as a resource to increase student’s knowledge
about the impact of the rise of China in contemporary regional level;
3. It can be used as a guide to study the application of national interest
concept and the theory of foreign policy behind the political conduct of
states;
4. To qualify for graduation degree in International Relations Department of
Universitas Muhammadiyah Yogyakarta.

1.6. Method of Writing
The paper is structured by using the explanatory types of research, which is
based on the descriptive qualitative research method using case study, text and
literature analysis. This paper is mainly a form of secondary research that involves
the examination of studies of other researchers.
In order to obtain the best result, the author seeks to look deeper into the
works of literature, articles, and journal about the history of China economic
development and military modernization, the role and involvement of China in
Asia-Pacific regional affairs and the nature of regional system, international
affairs in Asia Pacific before and after the rise of China. The author seeks to look
12

also into the literature of regional dispute, the history, and legal articles in that
regard, as well as any supportive literature on applied concept.

1.7. Research Area
In this research, the author attempts to focus the analysis on certain
phenomena that arises following the rise of China in the context of contemporary
politics and how these phenomena further affect the discourse of security and
regional stability. The regional level in the paper is focused on the area of AsiaPacific specifically among China, Japan, and Southeast Asian countries, with
particular regard to territorial disputes in the South China Sea and East Asia Sea.
As for the timeframe, the author defines that the regional implication given by the
rise of China was increasingly visible in the contemporary Asia-Pacific regional
affairs. Contemporary Asia-Pacific refers to and emphasizes on the twentiethcentury regional activities which include the political and economic affairs in
these past decades.

1.8. Organization of Writings
Chapter One: Presents the introduction of the topic. It contains the background
of the issues; Research Question; Theoretical Framework; Hypothesis; Methods
of Writing; Research Area; and Organization of Writing;
Chapter Two: Presents the brief presentation of the history of China's
development, represented by series of highlighted events from Mao’s era;
Chapter Three: Presents the examination on Asia pacific contemporary regional
affairs before and after the rise of China;

13

Chapter Four: Presents the discussion of analysis between the finding and the
applicability of the theory/concept of foreign policy and national interest as well
as the criticism opposing the applicability of the theory;
Chapter Five: Conclusion.

14

CHAPTER II
THE RISE OF CHINA:
THE HISTORY AND SERIES OF HIGHLIGHTED EVENTS

China, the world's third-largest country with a population reaching 1.3
billion people, was recorded as the most populous country in the world. China
accounted for a fifth of the world's population, is a country that has long and
remarkable economic development stories in modern times. Successes and failure
followed, China’s peaceful rise as an official policy under Hu Jintao leadership
drove the country to the moment of eternal triumph, despite the controversy as an
emerging giant’s international influence. The rise of China later became a notion
that marks the country's prowess in suppressing the national economy growth to
become one dominant force in Asia-Pacific even capable of being a highlight in
the global world.
Notably, the rise of China is not a new occurrence in the history of China,
rapid growth and highlighting achievements in the eighteenth century made the
rise of China as the phenomenon of revival. Despite claimed to be a peaceful
development, the event is interpreted differently by other states, the development
that followed was expanded, not only focus on one aspect of development; it
covers the fields of politics, economy, and military at once. The rise of China, by
the scholars are often used in referring to the events of China's miraculous
development following the economic reforms pursued by the Chinese
government, initiated in the Third Plenary Session of the Eleventh Central
Committee of the Communist Party of China (CPC) held in December 1978, in
which the grand plan of the policy reforms and the more open up market was
13

ensured.1 Cao (2005) argue, the ideology of the reform came directly from the
work conference and the conference also decided the general of reform in
principle, so it is correct to say that the Third Plenary Session of the Eleventh
Central Committee of the Party marked the beginning of the Chinese economic
reform, which asserted the need of major refurbishment in the production
field.2The achievement of the economic reform and opening-up policy have
ushered China’s economy into a rapid phase of development and because of this,
China being rated as one of the highest economic growth state ever achieved in
regional and global level, amidst the booming Asian economy thereof.3 Later
during the Fourteenth National Congress of the CPC in 1992, China announced
that the goal of the economic reform is primarily to replace the soviet economic
model adopted in Mao’s era, to the more open social-market economy system,
described as socialism with Chinese characteristic, which marks the beginning of
a new phase of China's economic reform thereafter.4The following discussion will
elaborate the history of economic and military development from time to time
within the context of highlighted events.

2.1. China’s Massive Development: From Mao’s Military Modernization to
Deng’s Economic Reform in the Twentieth-Century
Reform for the seeks of fundamental changes in political and economic
institutions, is his excessive belief in the supremacy of "men over material",

Liu Guoguang, ‘China’s economic reform: Successes, challenges, and prospects for the twentyfirst century,’ p. 80, in Fumio Itoh (Ed.), China in the twenty-first century: Politics, economy, and
society (Tokyo, United Nations University Press 1997), p. 80.
2
Tian Yu Cao, The Chinese Model of Modern Development (1st edn, Routledge 2005), p. 28.
3
Guoguang, ‘China’s economic reform,’ p. 81 (footnote 32).
4
ibid., p. 82.
1

14

which depressingly led to the more politicized PLA. In the 1960s the political
situation is getting tense, following the split with the Soviet when Mao faced
increasing resistance to his authority within the party and in the higher echelons of
the PLA. In the end, it led to the emphasis of people's war by Mao's close
associates.5 Eventually, the ambitious Great Leap Forward project, the AntiRightist Campaign (1957-1959) followed by the eruption of Cultural Revolution
(1966), ends in over million excess deaths on the Great Chinese Famine and other
immense consequences that changed the traditional system and China as a state
significantly.
One of the most challenging tasks in any political system, 6 unlike the
revolutionary process, the reform process aims to achieve changes through
peaceful means, rather than force, and by working through existing political
institutions, rather than overthrowing them.7 China, in this regard, after decades of
maintaining the overly poor economic system, centrally-controlled and stagnant,
in the late 1970s under Mao Zedong, finally find a way to deliver major changes
in the political and economic system of the state. Under Mao’s administration,
China’s economic growth is gradual but susceptible. It shows a reasonable
phenomenon of revival and success to break the attention from the highlights of
Western economic advancement. In addition to Mao's restoration project in the
economic sector, the other thing that deserves to be underlined was the efforts to
build-up and modernizing China's defense sector.
Even before the deterioration of Sino-Soviet relations by the early 1960s,
which ended in the dismissal of assistance in the form of men, material and

5

ibid.
Harry Harding, China's Second Revolution (1st edn, Brookings Institution 1987), p. 271.
7
ibid.

6

15

technology from the Soviets against China, the nation has indeed absorbed the
best from the Soviet.8By using the Soviet expertise and technology, to start a
military-industrial complex (MIC) for modernizing its defense services, Soviet
has indeed helped modernize the Chinese People’s Liberation Army (PLA) in a
significant matter.9Thus, by late 1950s, China had somewhat professionalized and
modern military included the progress of having 4000 combat aircraft for the air
forces division.10
Nonetheless, apart from the good record of Mao’s revolutionary act, the
history recorded that it was not last until the year later- it turned into a great
catastrophe. Turns out the economic and military development under Mao’s were
transient, it was susceptible, yet getting stagnated in the middle of its
implementation and led to the substantial decline in the numbers. Some methods
proved unsuccessful and disappointing, such as the poor agricultural techniques
which turned into salinization and severe deforestation. In 1971 China had
achieved grain self-sufficiency through the aggressive rural policy measures, but
the new policy, with its emphasis on local decision-making was burdened by other
political baggage that eroded its effectiveness.11
As highlighted in the history, one issue that becomes a turning point of
Mao's fall is his belief in the supremacy of "men over material" which in fact led
to the more politicized PLA. In the 1960s the political situation is getting tense,
following the split with the Soviet when Mao faced increasing resistance to his
authority within the party and in the higher echelons of the PLA. In the end, it led

Singh, 'The Political Economy of China’s Defence Modernisation', p. 688 (footnote 8).
ibid.
10
Ellis Joffe, The Chinese Army After Mao (1st edn, George Widenfeld and Nicolson 1987).
11
Gautam Jaggi and others, 'China's Economic Reform: Chronology and Statistics' (Institute for
International Economics 2016), p. 3.
8

9

16

to the emphasis of people's war by Mao's close associates.12 Eventually, the
ambitious Great Leap Forward project, the Anti-Rightist Campaign (1957-1959)
followed by the eruption of Cultural Revolution (1966), ends in over million
excess deaths concluded in the Great Chinese Famine and other immense
consequences that changed the traditional system, and China as a state
significantly. The death of Mao Zedong and the arrest of major counterrevolutionary forces in the 1976 Cultural Violence, known as the gang of four,
ended the ten-year of Cultural Revolution, gave rise to a popular demand for a
faster economic progress and a better-living standard in the People’s Republic of
China.13
In 1978 the economic reform took place under the leadership of Deng
Xiaoping. It was gradual, but the effects hold the fort and they have been
remarkably successful. The post-Mao reforms have reserved the decline in
economic growth rates with an average annual rate of increase of rural output
since 1979 has been 10.5 percent, well above the rates of 4.0 percent to 5.0
percent achieved in the 1950s, 1960s, and early 1970s.14 Broadly, the sector of
rural economy enjoyed the most rapid rates of growth. The emphasis was
principally placed in the idea to change the market system. Remodelling the
system, Deng transformed the existing private and state-owned market system
into the most liberal one that is open to more opportunities and possibilities of
foreign investment and a wider network of economic partners to boost China's
economy and improve the vastly inefficient and relatively isolated economic

Singh, 'The Political Economy of China’s Defence Modernisation,’ p. 683 (footnote 8).
Lin Wei and Arnold Chao, China's Economic Reforms (1st edn, University of Pennsylvania
Press 1982).

12

13

14

Harding, China's Second Revolution, p. 274 (footnote 37).

17

system, to improve the welfare of farmers, the central government initiated price
and ownership incentives for farmers, which enabled them to sell a portion of
their crops on the free market.15Whereas in order to increase the economic
productivity reforms were also implemented in the urban industry which allowed
the state-owned industry to sell any production in both plan and market prices, the
consideration was to avoid the strict and centrally-oriented former market, which
were too closed and only relying on the results of the housing and agricultural
production. The acceleration of the rates of growth industry and agriculture's has
allowed a large increase in nominal rural and later urban income.16
Through the intense monitoring system and strong principles, the open
market system under the framework of China's economic reform is able to
increase potential opportunities for the society to start their own business, as the
government undertaking the measures to support great value export to increase the
per capita income of the citizen. China's policy in this regard heavily relies on
commercial traffic, improving the quality and quantity of production take
precedence to break the export number and increase the interest of investor to
make investments in large numbers from the smallest to largest sectors. In this
economic modernization, China insisted on the formation of credible and
competence government structure for the sake of stability and positive reputation,
this measures This step ensured by the electoral system organized and lead by
Deng Xiaoping. In the bigger picture, Deng's recovery attempt was focused on
eight main indications:

Wayne Morrison, 'China’s Economic Rise: History, Trends, Challenges, And Implications for the
United States' (Congressional Research Service 2015), p. 4.
16
ibid., loc. cit.
15

18

The rise in industrial and agricultural production; Faster rises in the output
of some major products; The bigger volume of transport; Rises in domestic
and foreign trade volumes; A rising national income; Wider employment; A
general rise in people’s monetary income; and advances in education,
science, culture and public health.17
There are two factors that make China could increase their economic growth so
quickly; the large-scale capital investment (financed by large foreign domestics
saving and investment) and rapid productivity growth.18Both of these factors has
successfully led China to its golden era through the improve in economic growth
efficiency and increase in economy stability. China has also achieved dramatic
gains in foreign economy relations, as in 1986, China's foreign trade at more than
$70 billion, was more than three times what it had been in 1978.19
In addition, China exports to its national output rose from 5.6 percent in
1978 to 13.9 percent in 1986, while the states succeed to absorbed $28df
billion in the foreign capital between 1979 and 1986.20
With such rapidly rising economic sector China started raising its GDP share of
the world total from 5.2 percent in 1980 to 17.5 percent later in 2008. 21Gradually,
China regains the global trust and prestige as the economic superpower, the one
state with the largest trade partner and the ability to surpass the Western economic
grandeur.
The economic rise of China is indeed a complex unity. Many of the political
analysts perceive this as a strategy to gain world domination. On the other hand,
when China recognizes this as a peaceful rise, one may acknowledge that this
remarkable development has given a great advantage for China to run the state's
interest; it can be observed from how the rise of China managed to change the

17

Wei and Cao, China's Economic Reforms, pp. 3-7 (footnote 44).
Morrison, 'China’s Economic Rise,’ p. 7 (footnote 46).
19
Harding, China's Second Revolution, p. 275 (footnote: 37).
20
ibid.
21
Li Yang, ‘China’s Growth Miracle,’ p. 2 (footnote 4).

18

19

regional order, at least in the form of alliance-based cooperation and increase the
importance of their role in regional politics. Indeed, China's re-emergence as the
world economic and the global power rises state is an important question about
what we can learn from its previous rise and fall and about the external and
internal threats confronting this emerging economic superpower for the immediate
future.

2.2.

Four Modernization: China’s New Form of Military Modernization
Should be underlined, the excessive attention to the military sector is one

reason for the failure of Mao Zedong in maintaining the stability of China's
growth. While high military expenditure does mean better prospects for a
modernization in the defense sector, opinions differ over the cost and impact on
the economy.22According to Amartya Sen (1995) and what was then believed by
most of the economist, the benefits of military expenditures are uncertain, limited
and economically unproductive, while for the developing countries the long term
effects is mostly negative, in the sense that it will cause the growth reduction in
socio-economic sector or welfare losses by ‘crowding out’ other uses such as
private investment and social spending.23 Similar assessment considered by Deng
Xiaoping to start China's reform era. His view on Mao’s development strategy
was pessimistic. For him to a policy that prioritizes military forces as the main
aspect, the state of the PLA is wretched and Mao's concept of People's war is
outdated. Far from being a modern army, it was a laggard in almost every

Singh, 'The Political Economy of China’s,’ p. 680 (footnote: 8).
Amartya Sen, 'Rediff On the Net Business Interview/ Amartya Sen' (Rediff) 1995, available at
accessed 10 October 2016, cited in Singh,
'The Political Economy of China's, p. 684 (footnote: 8).
22

23

20

aspect.24In contrast to Mao's strategy, Deng implements economic development
vis-à-vis defense that favoured a grand strategy where strategic resources were to
be used in a manner that will ensure the survival and development of the Chinese
nation.25
According to Deng, the ‘four modernisations' program that emerged in 1979
was, nothing, but one of the many tools of the Chinese grand strategy. It put
defense modernization as the last priority and instead gave preference to
agriculture, industry and science and technology at the first, second and
third place.26
Accordingly, post-Mao reform, the role of PLA and its political influence
eroded. As a result of Deng's policies to reduce the priority in the defence sector
through his four modernization program, China’s official defence expenditures
went down from an all-time peak which amounted to 13 percent fall from 1979 to
1989, which kept on falling to the subsequent years’ to be distributed to other
priority sectors such as agriculture on the first top priority; trade and industry; as
well as the investment.
By 1989, China’s official defense budget was around 9 percent of the
central government’s expenditure and less than 2 percent of the GDP. This
was a sharp decline from the 1979 official figure of 17.7 per cent and 3.5
per cent respectively.27
One may believe that economic growth is the root of the massive growth in
various sectors of the country. According to Perkin (2005);
If China does manage to sustain high economic growth rates, not only will
such growth strengthen political stability, but Beijing would also find it
easier to expand China’s military expenditures. Over the long term, China
will likely strive to become a world military power commensurate with the
country’s size, population, and role in world history.28
Singh, 'The Political Economy of China’s,’ p. 684 (footnote 8).
ibid. p. 685
26
ibid.
27
Singh, 'The Political Economy of China’s,’ pp. 686-689 (footnote 8).
28
Perkin D, 'Special Studies: China’S Economic Growth: Implications for The Defense Budget'
(The National Bureau of Asian Research 2006), p. 364.
24

25

21

This, in fact, is quite evident in the future. After successfully implementing
economic reforms and gaining the countries confident, Deng then sees the interest
in the improvement of the defense sector. After decades of declining budget,
Funds for the PLA started increasing after 1989 and kept on increasing more
rapidly than inflation and indeed than the GDP rate.29 This policy change was
based on several highlighted issues, including the crucial role of the PLA in
suppressing the 1989 Tiananmen Square incident and the fact a decline in defense
budget has aggravated the condition and combat's capability of the PLA.30Since
then, the PLA’s modernization has been developed in four directions:
A significant increase in military spending; reforming the defense industry,
bringing new technologies and approaches in its military-industrial complex
which is the largest in Asia; remarkable and extensive military build-up
exceeding the usual modernization; and military modernization that foresaw
an increase in the salaries of PLA personnel and an improvement in their
living conditions.31
This resurrection was basically felt globally and throughout the region, Asia
Pacific. The international community realizes, by means of rapid economic
growth, the Chinese government intended to entirely sophisticate its technology,
including also a military modernization. The past failure has indeed encouraged
China's optimism to improve military strength and capacity as a form of
anticipation and catch up for almost 20 years. China is also aware that economic
and military power is the prime key for them to acquire an important role in the

Singh, 'The Political Economy of China’s,’ p. 688 (footnote 8).
ibid.
31
Richard A. Bitzinger, 'M