china & us the new geopolitical equation · china & us the new geopolitical equation •last 30 yrs...
TRANSCRIPT
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China & USThe New Geopolitical Equation
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The Chinese World Order
• 15 yrs ago journalist James Mann published The China Fantasy.
• Criticized US policymakers using “Soothing Scenario” regarding China. In this view, China’s exposure to benefits of globalization would lead it to embrace democratic institutions & support US-led world order.
• Instead Mann predicted, China would remain authoritarian, & its success would encourage other authoritarian regimes to resist pressures to change.
• Mann was right.
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China & USThe New Geopolitical Equation
• Last 30 yrs China implemented a wide-ranging modernization strategy of economic, military and diplomatic expansion/outreach to the world.
• China’s pursuit of a larger role in the world coincides with America’s pursuit of a smaller one.
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China & US GeopoliticsPart 1• Geography• History
• Background Issues: Taiwan, Japan, India, Russia• Association of South East Asian Nations (ASEAN)• South China Sea
• Emerging China• China’s National Strategy
• Economic Modernization: Trade, “OBOR”• Military Modernization “Off Shore Defense”
• US-China Relations Chronology
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China & US GeopoliticsPart 2• Great Decisions Video• US-China Relations
Chronology (cont)• Trump era• Misc Viewpoints
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YELLOWSEA
EAST CHINASEA
SOUTH CHINASEA
Korea Japan
Taiwan
PRC
India
Russia
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TAJ
MYANMAR
AFGTibet
Plateau
RUSSIA
Yellow
Yangtze
Pearl
Population:China 1.4 BUS 326 M
US 3.8 m sq miCh 3.7 m sq mi
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Economic, IndustrialCenters
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Chinese Autonomous Regions
• Like a province, an Autonomous Region has own local government, but has more legislative rights.
• A minority entity which has a higher population of a particular minority ethnic group.
XinjiangUighur45/40%
TibetTibetan93/6%
Mongol17/79%
NingxiaHui34/65%
Guangxi Zhuang32/62%
Inner Mongolia
Han91%
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• Up to 1 million people, or 7% of Muslim population in Xinjiang, are incarcerated in expanding network of “political re-education” camps, per US & UN
Sep 3, 2018East Turkestan
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Hundred Years of National Humiliation• Intervention: West powers & Japan 1839-1949• Opium Wars UK (1839-42, 1856-60); Taiping
Rebellion (1850-64); Sino-French War (1884–1885); Sino-Japanese Wars (1894–95, 1937-45); Boxer uprising (1899–1901); British invasion Tibet (1903–1904); 21 Demands (1915) by Japan
• Loss of sovereignty to foreign “Spheres of Influence" after military defeats & Unequal Treaties
• Reparations, open trade ports, lease or cede territory (Manchuria & NW China to Russia, Jiaozhou Bay to Germany, Hong Kong to UK, Zhanjiang to France, Taiwan & Liaodong Peninsula to Japan)
• US “Open Door” Policy• Anti-West Sentiment, China Xenophobia
https://en.wikipedia.org/wiki/Century_of_humiliation
https://en.wikipedia.org/wiki/Western_worldhttps://en.wikipedia.org/wiki/Imperial_Japanhttps://en.wikipedia.org/wiki/Sphere_of_influencehttps://en.wikipedia.org/wiki/Outer_Manchuriahttps://en.wikipedia.org/wiki/Outer_Northwest_Chinahttps://en.wikipedia.org/wiki/British_Hong_Konghttps://en.wikipedia.org/wiki/Guangzhouwanhttps://en.wikipedia.org/wiki/Taiwan_under_Japanese_rulehttps://en.wikipedia.org/wiki/Kwantung_Leased_Territory
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REPUBLIC OF CHINA (ROC) TAIWAN
• 1955 Sino-American Mutual Defense Treaty• 1960s Taiwan rapid economic growth. “4 Asian Tigers”
Japan, S Korea & Singapore.• 1966-76 PRC Cultural Rev -1.5M• 1971 ROC lost UN seat to PRC• PRC claims sovereignty over
Taiwan & refuses diplomatic relations with any country that recognizes ROC
• Taiwan-multi-party democracy.
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TAIWAN
• 1979 US established diplomatic relations with PRC.• Carter terminated Sino-American Mutual Defense Treaty• Supreme Court declined to rule Goldwater v. Carter (Right of
President to unilaterally terminate treaty.)• US: One China Policy
• 1979 Taiwan Relations Act • Unofficial relations thru nonprofit corp - American Institute in
Taiwan• No “ROC,” use “Taiwan authorities” = de facto diplomatic
relations• "US make available..defense articles & services..to Taiwan..self-
defense" • Nature of defense services TBD by President & Congress.
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TAIWAN
•“Strategic Ambiguity” • US official position: PRC & Taiwan refrain from
actions or statements "that would unilaterally alter Taiwan's status.”
•No Forced Annexation or Declared Independence
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Apr 27, 2018
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• Economic leverage to achieve foreign-policy goals.• Demands airlines remove any reference to Taiwan, Hong
Kong, & Macau as countries independent from China.• Websites cannot list Taiwan only as “Taiwan,” without
reference to China. • “Separatist” material in China - such as map w Taiwan in a
different color - results in legal, political & criminal consequences.
• Closed Marriott’s website for week after included Taiwan & Tibet in pull-down country list in online consumer survey.
• Marriott apologized, ended survey, & fired a US-based Marriott employee, who used company social media to “like” a Twitter post of a Tibetan separatist group.
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• LA branch Taiwanese-owned 85CBakery Cafe gave a gift bag & welcome, to Taiwan President Tsai Ing-wen.
• Chinese customers in mainland China furious & called for boycott. • Food delivery services dropped chain from apps & shares in parent
company fell 7.5%. Company lost $120M.• Company (½ its revenue in China), reiterated "firm support" for 1992
Consensus - loose agreement tween Taiwan & China that there’s only one China, without defining what that means.
17 Aug 2018
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• 2010 Economic Cooperation Framework Agreement (ECFA)
• Preferential trade agreement to reduce tariffs & commercial barriers
• PRC’s 7th largest trade partner and 6th largest source of imports.
• Taiwan 22nd-largest economy
Taiwan Trades Mostly w China
$128b 2016
$46b 2016
Exports
Imports
40%
16.4%
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CHINA - JAPANSENKAKU/DIAPYU ISLANDS DISPUTE
Okinawa
• WW2 Japan Apology• Controlled by Japan
since 1895. • PRC & Taiwan both
claim ownership prior to 1895.
• China acquiesced to Japan until 1970s• 1969 potential
gas fields identified
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CHINA - JAPANSENKAKU DISPUTE
• Overlap EXCLUSIVE ECONOMIC ZONES (EEZ).
• 2006 PRC drilling.• 2008 PRC & Japan agree Japan
invest in drilling & receive $ from obtained oil.
• Not address Senkaku ownrship• US: no position on sovereignty
but islands in Treaty of Mutual Cooperation & Security tween US/Japan.
• 2010 Japan seize Chinese ship = Chinese REE “ban”
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https://atlas.media.mit.edu/en/profile/country/jpn/#Destinations
Japan 4th largest export economy 2016 export $688B import $575B positive trade balance $113B. GDP of Japan $4.95T GDP per capita $42.3k.
OEC Observatory of Economic Complexity
$120B
$148B
Imports
https://atlas.media.mit.edu/en/profile/country/jpn/#Destinations
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YELLOWSEA
EAST CHINASEA
SOUTH CHINASEA
INDIA CHINA• 1962 Sino-Indian
War• PRC seized Aksai
Chin but not Arunachi Pradesh
• 1996 “ Line of Actual Control”.
• 2013 India joint oil explorations with Vietnam in S China Sea & advised by PRC to stay out.
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YELLOWSEA
EAST CHINASEA
SOUTH CHINASEA
INDIA CHINA• India seen as competing
potential world power astride their oil routes.
• Sri Lanka sea-port building
• China “One Belt One Road”
• China lead in exploring Indian Ocean for minerals.• 2011 Intern’l Seabed
Authority (ISA) Exclusive right to exploreSri Lanka
India
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7th largest export economy 2016 export $261B
import $339Bnegative trade balance $78BGDP $2.26T GDP per capita $6.57k.
$10.7B4.1%
$58.9B
$45.5B
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RUSSIA
• Common Border • World’s 2 leading authoritarian nations. UN Security
Council• Sino-Russian partnership is counterweight to US on global &
regional issues. • Seek a multipolar global power configuration more suitable
to their interests (BRICS Brazil, Russia, India, China, S Africa)
• “Strategic partnership,” but they are not “allies.”• Vostok 2018 War Games 300k (largest in 4 decades)
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16th largest export economy2016 export $269B
import $180Bpositive trade balance $88.6BGDP $1.28T GDP per capita $24.8k
$30B
$35.58B
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Association of Southeast Asian Nations(ASEAN)
• 1967 Regional organization of 10 Southeast Asian states • Promotes intergovernmental cooperation & economic integration
amongst its members. Indonesia, Malaysia, Philippines, Singapore, Thailand, Brunei, Cambodia, Laos, Myamar (Burma) & Vietnam
• Seeks an Asian Common Market.• Annual East Asia Summit (EAS) since 2005:
• "ASEAN Plus” - Additional attending countries (Not members): US, PRC, Japan, Russia, Australia, New Zealand & India.
• Potential multi-state venue for South China Sea Resolution vs Bi-lateral negotiations. Thus far unsuccessful.
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YELLOWSEA
EAST CHINASEA
SOUTH CHINA
SEA
KoreaJapan
Taiwan
PRC
India
Russia
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SOUTH CHINA SEA - VITAL SEA LANE• Second most used sea lane in world. 5X Panama. 3X Suez.• 50% of world annual merchant fleet tonnage. • Over 11 million barrels crude oil a day.
https://en.wikipedia.org/wiki/Sea_lanehttps://en.wikipedia.org/wiki/Crude_oil
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SOUTH CHINA SEA RESOURCES •OIL: Estimated reserves of 4.5 km³ (28 billion barrels).•NATURAL GAS: Estimated reserves around 7,500 km³
(266 trillion cubic feet).
•FISH: One third of the entire world’s marine biodiversity • 12% of 2016 global catch• Stocks are depleting
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Spratly Islands
ParacelIslands Scarborough
Shoal
Gulf of Thailand
NatunaIslands
Straight ofMalacca
Singapore
Gulf of Tonkin
PratasIslands
MacclesfieldBanks
AnambasIslands
1400 nm north to south700 nm east to west
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China’s“9 dash line”
Claim• Historical - based
on Chinese fishing & trading
• Resolve issue by bi-lateral negotiation w each party
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United Nations Convention on the Law of the Sea(UNCLOS)
• In force 1994. US not a signatory. • Nations’ rights/responsibilities on use of oceans/maritime
zones. • International Tribunal for the Law of the Sea (ITLOS).• No enforcement mechanism.• International Seabed Authority (ISA) to authorize seabed
exploration and mining outside EEZ and collect and distribute the seabed mining royalty.
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• Territorial: 12NM, Coastal state rules & use any resource.
International waters(Outside Territorial waters)
Maritime Zones
• International: Waters / Airspace
• EEZ: 200 NM, Coastal nation sole exploitation rights over resources. -Foreign freedom of navigation and overflight.
Continental Shelf
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•UNCLOS does not determine sovereignty of a given land mass•Assumes a state has undisputed title over land from which maritime zone is claimed.
•Once sovereignty of land is determined it stipulates jurisdiction over surrounding waters.
• Sovereignty Claims1. Historic: PRC, Taiwan & Viet 2. Discovery & occupation: Viet, Philippines,
Malaysia, PRC, & Taiwan 3. UNCLOS: A feature “Rock or Island” lies within
state’s jurisdictional area - Brunei, Indonesia, Malaysia & all
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EVERYBODY SOUTH CHINA SEA
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SPRATLY ISLANDS• Portions Claimed by China (PRC & Taiwan), Brunei, Indonesia,
Malaysia, Philippines, Vietnam• > 400 land features. Mariners call it Dangerous Ground• No indigenous population• Features Currently Occupied:
• Vietnam 29 Brunei 2
• China 8 Taiwan 1
• Philippines 8 Indonesia 0
• Malaysia 5
https://en.wikipedia.org/wiki/Dangerous_Ground_(South_China_Sea)
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CHINA’S LAND RECLAMATION PROJECTSGreat Wall of Sand
Hughes Reef
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CHINASUBI REEF 976 ACRES RECLAIMED
July 24, 2016August 8. 2012
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2016 RULING International Tribunal for the Law of the Sea (ITLOS)
• 2013 Philippine arbitration against China "nine-dash line"• 2016 Tribunal backed Philippines• No evidence China historically exercised exclusive control over
waters or resources, hence "no legal basis for China to claim historic rights" over nine-dash line
• “Historic Rights do not supersede another nation’s EEZ”• Criticized China's artificial islands - severe harm to coral reefs• Features of Spratly are "rocks" under UNCLOS, & not entitled to
a 200 nautical mile EEZ • China rejected the ruling, calling it "ill-founded"
https://en.wikipedia.org/wiki/Nine-dash_line
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CURRENT UNITED STATES POSITIONSouth China Sea
• Non signatory of UNCLOS.• No use of force or coercion by any claimants.• Freedom of Navigation (private, commercial, military vessels & air).• Maritime entitlements based on UNCLOS or land mass. China’s 9-
dash line does not meet these criteria.• US takes no position on merits of competing sovereignty claims.• An effective Code of Conduct is essential for preventing incidents.• US supports international dispute resolution mechanisms (ITLOS).• US will respond to allies who want to improve their ability to patrol.
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EMERGING CHINA• China’s Economy: 2nd nominal GDP; 72nd per-capita GDP• Largest Population.
• Since 1990 800 M people raised out of extreme poverty• Largest by Purchasing Power - GDP (PPP).• Largest Trading Nation.• Major creditor & 2nd largest foreign holder of US public debt.
40% of China’s 1.2 Trillion Reserve is invested in US.• Fastest Growing Economy – 10% growth avg over 30 years.
• 1978-2004 grew 10 fold. But slowing down to 6%.• Hong Kong & Macau “One Country, Two Systems”
• Maintain “Capitalist” system for 50 years (Hong Kong 2047, Macau 2049).
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• > 450 US-based multinationals have projects in China.
• > 20,000 equity joint ventures• US investment in China: $256B• 2016 US trade deficit w China
exceeded $347 billion & was US’s largest bilateral trade deficit.
• “Attributing commercial value to last country of origin perverts true economic of bilateral trade imbalances. This affects political debate & leads to misguided perceptions. Estimates based on true domestic content can cut US China deficit by half, if not more."
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Interwoven China-US Economic Ties• 2017 trade increased 15.2% year-on-year.
• China's exports to US grew 14.5%• US exports grew 17.3%
• China & US are each others largest trade partners.• 1979=$2.5B, 2017=$583.7B; 1971=$5M/year. 2016= $5M/hour
• China: 26% of US-exported Boeing aircraft, 56% of soy beans, 16% of autos, 15% of farm produce, 15% of integrated circuits.
• Trade structure improving. Past decade, US exports to China increased 11% annually & China's exports only rose 6.6%.
• Although China has trade surplus with US, does not mean China benefits & US loses. 40% of trade surplus generated by US companies in China. 2017, US exports to China created 1 M US jobs
http://www.chinadaily.com.cn/a/201807/05/WS5b3de608a3103349141e0f4d.html
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Interwoven China-US Economic Ties• US trade with China saved avg American household up to $850/yr or
1.5% of median household income of $56,500, in 2015.• US firm sales in China $372 B in 2015, ($223 B by their subsidiaries
in China and $150 B in exports from US to China).• US: service trade surplus with China, surged 30-fold 2006 to 2016.
2017 US service trade surplus $54.1 B.• Tourism exports are 61% of US service exports. 2.97 M Chinese
traveled to US in 2016, spent $33 B.• Chinese students are highest % of foreign students in US
universities for 8 yrs since 2010.• 350,755 Chinese students in US Higher Ed 2018, up 6.8% for year.
http://www.chinadaily.com.cn/a/201807/05/WS5b3de608a3103349141e0f4d.html
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2nd largest export economy2016 export $1.32T
import $2.12Tnegative trade balance $791BGDP $18.6T GDP per capita $57.6k.
$122B
$436B
$207B
$179B
$289B $268B
Exports
Imports
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China largest export economy 2016 export $2.27T
import $1.23Tpositive trade balance $1.04TGDP $11.2TGDP per capita $15.5k.
$463B
$122B
Exports
Imports
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The $80 Trillion World Economy
• Rank Country GDP % Global GDP• #1 US $19.4 T 24.4%• #2 China $12.2 T 15.4%• #3 Japan $4.87 T 6.1%• #4 Ger $3.68 T 4.6%• #5 UK $2.62 T 3.3%• #6 India $2.60 T 3.3%• #7 France $2.58 T 3.3%• #8 Brazil $2.06 T 2.6%• #9 Italy $1.93 T 2.4%• #10 Can $1.65 T 2.1%
http://www.visualcapitalist.com/80-trillion-world-economy-one-chart/
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CHINA’S claimed growth numbers under increased scrutiny
• Chinese officials & non-Chinese financial/econ observers claim govern has been inflating economic output.
• Liaoning Provincial govern admitted it overstated GDP by 20% from 2011 to 2014.
• 2015 China's official GDP growth figures might be double actual rate.
• Tianjin’s 2016 trillion yuan GDP claim was in fact a third lower.• Wall Street Journal survey of economists found 96% think China's
GDP estimates do not "accurately reflect Chinese economy.”• China's premier said GDP #s are "man-made" & unreliable & should
be used "for reference only"
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EMERGING CHINA• Unfair Trade Practices
Artificial Currency DevaluationIntellectual Property theftProtectionismFavoritism, One Party Oligopoly, • Corruption• Pollution Hacking
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HONG KONG (Reuters) — If the People's Liberation Army went to war tomorrow, it would field an arsenal bristling with hardware from some of America's closest allies: Germany, France and Britain.
Dual Use TechnologyNuclear, Chemical, BioMed, Elect, Mech
Reverse Engineering
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CHINA’S ECONOMIC TRANSFORMATION
https://en.wikipedia.org/wiki/Economy_of_China
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CHINA’S ECONOMIC TRANSFORMATION
• Prior 2000 China preoccupied with internal development• 1979 4 coastal special economic zones where foreign investment
received special treatment. 3 zones located close to Hong Kong. 4th directly across strait from Taiwan.
• 1980s Shifted allocation of goods & services from govern plan to the market. Private entrepreneurship & free market activities legalized & encouraged.
• Agriculture: Commune structure dismantled Free markets for produce • Heavy Industry: increased autonomy of enterprise managers, less
emphasis on planned quotas, enterprises produce goods outside gov plan for sale on market, bonuses for productivity.
https://en.wikipedia.org/wiki/Economy_of_China
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CHINA’S ECONOMIC TRANSFORMATION
• Light Industry: Indiv enterprise & collectively owned enterprises to soak up unemployment & supply light industrial products.
• Indiv enterprises & admin depts outside Ministry of Foreign Trade could negotiate w foreign firms. Co-op, trade & credit arrangements w foreign firms legalized.
• 1984 Expansion of economic development zones in 14 largest coastal cities as major commercial & industrial centers.
• 1985 State Council of China established a SNA (System of National Accounting) to use the GDP to measure the national economy.
https://en.wikipedia.org/wiki/Economy_of_China
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1979 4 coastal special economic zones
1984 Economic development zones in 14 largest coastal cities as major commercial & industrial centers.
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Special Economic Zones (SEZ) allowed government to experiment w market based economic policies, some of which they later adopted across entire country. SEZ were a form of state capitalism
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CHINA’S ECONOMIC TRANSFORMATION
• Public sector is bigger share of national economy than burgeoning private sector
• Coastal regions more industrialized while hinterland less developed • World's fastest-growing consumer market & 2nd largest importer of
goods. Net importer of services products & food • To avoid pollution, economy must shift to more advanced industrial
development w high-tech, low carbon emissions w better allocation of resources to innovation & R&D to reduce impact of heavy industry.
• Economic development of Shenzhen is dubbed as next Silicon Valley
https://en.wikipedia.org/wiki/Economy_of_China
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CHINA’S NATIONAL STRATEGY
• Focus on economic modernization.• Ocean food & energy resources are of increasing importance to
future development. • Economic center of gravity shift from interior to eastern seaboard.• Need greater strategic depth for maritime defense of China's
coastline. • Increasing reach of modern naval
weapons. • Requirements for navy that could …………. ………
defend China by operating credibly further out at sea.
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CHINA’S MILITARY STRATEGY
• Prior 1985 strategy was "Coastal Defense" • Focused on close-in defense of China's coast in
support of a major land war (against Soviets).• Peoples Liberation Army Navy (PLAN) was landward-focused &
expected to play a supporting role. (Brown Water Navy).
• 1985 "Active Offshore Defense"• New PLAN strategic orientation was redirected-out to sea
(against US) (Blue Water Navy).
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PLAN’S OFFSHORE DEFENSE
Two Components1. East Coast Protection
in Off Shores Waters• Anti-Access, Area
Denial Zone First Island Chain
• Interdiction Zone Second Island Chain
80 Anti-shipBallistic Missiles
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PLAN’S OFFSHORE DEFENSE
2. Shipping Lanes Protection
“String of Pearls”• Submarines• Bases• Contain India
Maritime Silk Road
Djibouti
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CHINA’SMILITARY BUILD-UP
• Last 15 years People’s Liberation Army Navy (PLAN) transformed toward “Blue Water” force
• Identified US Achilles Heels: • Reliance on aircraft carriers
• PLAN: 1 of world’s largest submarine fleets. Deployed near Guam & India• 80 DF21D Anti-ship ballistic missiles on coast
• Electronics/satellite communications. GPS• 2006 destroyed satellite w missile.• Electronic Warfare Hacking (EMP)
• 2016 deployed 1st aircraft carrier • Military Defenses on disputed islands• Create an “Anti-Access Area Denial Zone”
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U.S.- CHINA RELATIONS
• 1989 Tiananmen Square - US economic sanctions• Restricted Internat’l Monetary Fund development bank lending
• 1997-98 Exchange of presidential visits Jian Zemin & Clinton • 1999 NATO bombed PRC Belgrade embassy during Kosovo • 2001 9/11 PRC supported UN Resolution condemning attack.
Supported Coalition against Taliban. $150 M reconstruction aid to Afghanistan. Joint Counterterrorism discussions.
• 2001 World Trade Organization. Free trade agreements w ASEAN, Australia, New Zealand, Pakistan, South Korea & Switzerland.
• Looking Outward. Increasing exports.
https://en.wikipedia.org/wiki/Jiang_Zemin
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Shanghai CooperationOrganization SCO
• 2001 China created as alternative to NATO.
• Eurasian political, economic, & military organization.
• Member: China, Kazakhstan, Kyrgyzstan, Russia, Tajikistan, Uzbekistan, Pakistan* India* (*2017)
• Observer: Afghanistan, Belarus, Iran & Mongolia• Dialogue: Armenia,Azerbaijan,Cambodia,Nepal,SriLanka,Turkey• Guest: Turkmenistan, CIS, ASEAN, UN
• Largest geographical regional organization in world (3/5 of Eurasian continent and ½ of human population.
https://en.wikipedia.org/wiki/Shanghai_Cooperation_Organisation
https://en.wikipedia.org/wiki/NATOhttps://en.wikipedia.org/wiki/Eurasiahttps://en.wikipedia.org/wiki/Eurasia
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China & USThe New Geopolitical Equation
China & US�The New Geopolitical Equation��The Chinese World Order ���China & US�The New Geopolitical EquationChina & US GeopoliticsChina & US GeopoliticsSlide Number 6Slide Number 7Slide Number 8Chinese Autonomous RegionsSlide Number 14Hundred Years of National HumiliationREPUBLIC OF CHINA (ROC) TAIWAN TAIWANTAIWANSlide Number 20Slide Number 21Slide Number 22Slide Number 24Slide Number 25 CHINA - JAPAN� SENKAKU DISPUTESlide Number 27Slide Number 28Slide Number 29Slide Number 30RUSSIA Slide Number 32 Association of Southeast Asian Nations (ASEAN)Slide Number 34SOUTH CHINA SEA - VITAL SEA LANESOUTH CHINA SEA RESOURCES Slide Number 37Slide Number 38 United Nations Convention on the Law of the Sea�(UNCLOS)Slide Number 40Slide Number 41Slide Number 42SPRATLY ISLANDS CHINA’S LAND RECLAMATION PROJECTS� Great Wall of Sand CHINA� SUBI REEF 976 ACRES RECLAIMED�2016 RULING �International Tribunal for the Law of the Sea (ITLOS) CURRENT UNITED STATES POSITION�South China SeaSlide Number 49EMERGING CHINASlide Number 51Interwoven China-US Economic TiesInterwoven China-US Economic TiesSlide Number 55Slide Number 56The $80 Trillion World EconomySlide Number 58CHINA’S claimed growth numbers � under increased scrutinyEMERGING CHINASlide Number 64CHINA’S ECONOMIC TRANSFORMATIONCHINA’S ECONOMIC TRANSFORMATIONCHINA’S ECONOMIC TRANSFORMATIONSlide Number 68Slide Number 69CHINA’S ECONOMIC TRANSFORMATIONCHINA’S NATIONAL STRATEGYCHINA’S �MILITARY STRATEGY PLAN’S � OFFSHORE DEFENSE � � PLAN’S OFFSHORE DEFENSE � CHINA’S� MILITARY BUILD-UPSlide Number 78U.S.- CHINA RELATIONS Shanghai � Cooperation� Organization SCO China & US�The New Geopolitical Equation