Strategic Perspectives 26 1

STRATEGIC PERSPECTIVES 26
Asia and the Trump Administration:

Challenges, Opportunities, and a Road Ahead
by James J. Przystup and Phillip C. Saunders
Center for Strategic Research

Institute for National Strategic Studies
National Defense University
National Defense University
The Institute for National Strategic Studies (INSS) is National

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The mission of INSS is to conduct strategic studies for the
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Cover: Clockwise from left, Narendra Modi, Prime Minister of India, Shinzo
Abe, Prime Minister of Japan, Malcolm Turnbull, Prime Minister of
Australia, Xi Jinping, President of the People’s Republic of China, and
President Donald J. Trump
(Cover by DOD/Jack J. Church)
Asia and the Trump Administration
Asia and the Trump Administration:
Challenges, Opportunities, and a Road Ahead
By James J. Przystup and Phillip C. Saunders

Strategic Perspectives, No. 26
Series Editor: Denise Natali
National Defense University Press

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June 2017
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624
Contents
Executive Summary............................................................................................ 1
Introduction......................................................................................................... 5
U.S. National Interests in the Asia-Pacific Region.......................................... 6
Defining Trends in the Asia-Pacific Region..................................................... 7
Asia-Pacific Security Challenges..................................................................... 12
Sustaining U.S. Presence................................................................................... 20
Conclusion......................................................................................................... 30
Notes................................................................................................................... 32
About the Authors............................................................................................. 35

Executive Summary
The Asia-Pacific region is of exponentially increasing importance to the United States.

Developments there affect vital U.S. economic, security, and political interests. Unfettered ac-
cess to the region is a strategic imperative to allow the United States to protect and advance its
wide-ranging national interests.
The Donald Trump administration, in the face of a rapidly evolving strategic environment,
will need to develop policies to sustain the U.S. presence and safeguard American interests in
the Asia-Pacific region.
Defining trends in the Asia-Pacific region include:
■■ Rapid economic growth that has increased the region’s weight in world affairs and im-
portance to U.S. interests. Asia-Pacific economies make up more than one-quarter of the
global economy and account for about one-third of all U.S. trade.
■■ Rising Chinese economic and military power that has reshaped global and regional
trade and investment patterns and challenged U.S. regional dominance. Countries in the
region value their economic ties with China and do not want to be forced to make a stra-
tegic choice between Washington and Beijing.
■■ Increasing U.S. economic, military, and diplomatic engagement with the region since
the end of the Cold War.
Although countries in the Asia-Pacific region are primarily focused on economic develop-
ment, a number of security challenges could threaten regional stability and damage U.S. inter-
ests. These include:
■■ Sino-Japanese rivalry and conflicting claims over maritime boundaries in the East Chi-
na Sea and over the Diaoyu/Senkaku Islands
■■ North Korea’s increasing nuclear and missile capabilities, which challenge nonprolif-
eration norms, threaten U.S. regional allies, and will eventually include the ability to strike
the U.S. homeland with a nuclear-armed intercontinental ballistic missile (ICBM)
1
■■ China’s desire to resolve the Chinese civil war by achieving unification with Taiwan,
and Beijing’s increasing efforts to develop the military capabilities and economic leverage
necessary to coerce Taipei into accepting a political relationship with the mainland.
■■ Increasing tensions over conflicting maritime territorial claims in the South China Sea,
with all claimants engaging in a range of tactics to strengthen their positions and China
making greater use of its military and paramilitary forces to try to expand its effective
control of disputed waters.
We advocate a regional strategy focused on working with U.S. allies, partners, and mul-
tilateral organizations to build a rules-based regional order that includes China and advances
U.S. economic, security, and political interests.
■■ A rules-based regional order will help the United States to maintain economic, secu-
rity, and political access to the Asia-Pacific region and advance its interests in the face of
regional trends and security challenges.
■■ This approach requires sustaining the U.S. presence in the Asia-Pacific region and in-
tensifying cooperation with other regional allies and partners to shape China’s choices
and make it pay a price for aggressive actions that violate international rules and norms.
■■ If the United States is not actively engaged in shaping the regional economic order, that
order is likely to evolve in ways that do not reflect U.S. interests.
The starting point for a strategic approach to the Asia-Pacific region is to reinforce exist-
ing bilateral alliances with Japan, the Republic of Korea (ROK), Australia, the Philippines, and
Thailand to deal with specific security threats. The alliances also provide a good foundation for
expanding regional security cooperation. The United States should:
■■ encourage increased cooperation among U.S. allies
■■ develop strategic partnerships with key states in the region such as Indonesia, Malaysia,
Singapore, and Vietnam
2
■■ support trilateral and quadrilateral cooperation mechanisms with Australia, Japan, In-
dia, and South Korea
■■ shape the evolution of regional norms through active U.S. participation in regional or-
ganizations and dialogue mechanisms.
If the United States emphasizes its alliances, expands security cooperation with other part-
ners, and actively engages in regional multilateral institutions and dialogues, it will be able to
deal with China from a position of strength.
The mixture of cooperation and competition in the U.S.-China relationship will present
the new administration with a defining challenge given China’s increasing ability to affect the
broad range of U.S. global, regional, and domestic interests. The policy challenge will be to
maximize cooperation while competing successfully in areas where U.S. and Chinese interests
are opposed.
■■ President Trump will need to engage directly with his Chinese counterpart to keep both
governments focused on a cooperative agenda and to manage the more competitive as-
pects of the relationship. Domestic economic and political problems are likely to produce
more restrained Chinese external behavior and give U.S. policymakers more leverage.
■■ China does not aspire to challenge the United States for global leadership. In most re-
gions, its focus on maintaining stability and securing access to resources and markets is
relatively compatible with U.S. interests.
■■ U.S. and Chinese interests are less aligned in the Asia-Pacific, where China seeks in-
creased influence and increasingly views the United States as a constraint. Heightened
U.S.-China strategic competition and the potential for military incidents or crises makes
it imperative to improve bilateral communications and crisis management mechanisms.
■■ U.S. policymakers should resist Beijing’s efforts to create a U.S.-China condominium

or “G-2”-like arrangement, which would require accepting Chinese territorial claims (in-
cluding to Taiwan) at the expense of U.S. allies and partners.
The United States will have to deal with the rapidly evolving nuclear and missile threat
posed by North Korea, the most destabilizing element in the Asia-Pacific security environment.
3
■■ Military options are unattractive given the vulnerability of U.S. allies to attack by North
Korean long-range artillery and missiles armed with nuclear warheads.
■■ North Korea has no interest in trading its nuclear program for economic assistance; it
seeks recognition as a nuclear weapons state.
■■ Given North Korea’s history of cheating, a negotiated freeze on nuclear and missile test-
ing that does not include intrusive verification measures is unlikely to permanently con-
strain the North Korean ICBM program and would likely require concessions that would
reduce U.S. ability to deter and defend its allies against a North Korean attack.
■■ Given the bad options, the most effective policy may be to strengthen deterrence and
defense of the ROK and Japan, maintain the external pressure of economic sanctions, and
keep the door open to dialogue and diplomacy, aimed at the denuclearization of North
Korea as agreed to by Pyongyang in the September 2005 Six Party statement.
■■ To deal with the possibility of instability or regime collapse, the Trump administra-
tion should work to closely coordinate U.S. and ROK objectives, endstates, and policy
responses and try to engage China in discussions of responses to various contingencies.
Over the next 4 years, the United States will be challenged to maintain its leadership of a
rules-based order in the Asia-Pacific region. Sustained U.S. involvement and close coordination
with regional allies and partners will allow the Trump administration not only to meet the chal-
lenges in the Asia-Pacific region, but also to grasp the opportunities.
■■ U.S. diplomacy must play a leading role in strengthening our alliances, partnerships,
and regional institutions that widely share the U.S. commitment to a rules-based order as
the foundation of regional peace and stability.
■■ Consistent engagement with the region by the highest levels of U.S. leadership will be
critical for success.
■■ Allies, partners, and potential challengers will judge the regular presence of the Presi-
dent, Secretary of State, and Secretary of Defense in the region as a key indicator of U.S.
commitment.
4
Introduction
America’s engagement with Asia began before the United States existed. In February 1784,
the ship Empress of China departed New York harbor, arriving in Macau in August of that year.
The ship returned the following year with a cargo of Chinese goods that netted a $30,000 profit.
In Federalist Paper No. 4, John Jay referred to American commerce with China and India.
In 1835, before the United States touched the shores of the Pacific Ocean, the U.S. Navy
East India Squadron was established. In 1844, China, in the Treaty of Wanghia, granted trading
rights to the United States. Two years later, the United States attempted to negotiate a com-
mercial treaty with Japan. The talks ended in failure, but a decade later Commodore Matthew
C. Perry concluded the Treaty of Kanagawa, opening Japan to American goods and providing
protection for shipwrecked American Sailors engaged in the China trade.
In the last half of the 19th century, U.S. commercial interests expanded rapidly. At the end
of the century, U.S. interests expanded beyond trade. In the Treaty of Paris ending the Spanish-
American War, Spain ceded the Philippines and Guam to the United States. Expansion across
the Pacific brought the United States into contact with the geopolitics of Asia, focused then on
China and the efforts of the imperial powers (France, Germany, Great Britain, Italy, Japan, and
Russia) to carve out spheres of influence and commercial privileges in the weakening Qing
empire.
Over the past century, the United States has adopted multiple policy frameworks to protect
and advance its national interests in the Asia-Pacific region. The Open Door policy toward Chi-
na represented a unilateral U.S. initiative aimed at rejecting imperial spheres of influence and
special privilege and advancing the principle of equality of commercial opportunity. The Open
Door evolved into a multilateral framework for managing commercial competition in China.
A second Open Door note, issued at the time of the Boxer Rebellion, appealed to the imperial
powers to preserve China’s territorial and administrative integrity.
President Theodore Roosevelt, playing balance-of-power politics, aligned the United
States with Japan to check Russia’s efforts to develop an exclusive sphere of influence in North-
ern China and Korea. Roosevelt’s diplomatic intervention in the Treaty of Portsmouth brought
the Russo-Japanese war to a close.
In 1920, at the Washington Conference, the United States worked to fashion a multilateral
cooperative framework to preserve China’s territorial integrity and the postwar status quo in the
Asia-Pacific region. Lacking any enforcement mechanism, the Washington Conference system
5
failed to meet the challenges of rising Chinese nationalism, the great depression, and Japanese
unilateralism.
From 1945 through the end of the Cold War and the Barack Obama administration’s re-
balance to the Asia-Pacific, the United States has relied primarily on bilateral security treaties
with Japan, the Republic of Korea (ROK), Australia, the Philippines, and Thailand to protect
and advance its security interests.1 This bilateral “hub and spokes” framework has served as the
region’s informal security structure, underpinning its remarkable postwar reconstruction and
present-day prosperity. Today, the hub-and-spokes framework is evolving to encompass trilat-
eral cooperation among alliance partners and multilateral cooperation involving U.S. allies and
strategic partners.
The common principle underlying these various policy approaches is the concept of “ac-
cess”: economic access to the markets of the region to pursue U.S. commercial interests; stra-
tegic and physical access to our allies to ensure confidence in U.S. security commitments; and
political access to allow for the promotion of democracy and human rights.
At the same time, the United States has championed the evolution of a postwar liberal,
open, rules-based international order allowing for the free flow of commerce and capital sup-
ported by the Bretton Woods institutions of the World Bank, International Monetary Fund,
General Agreement on Tariffs and Trade, and its successor the World Trade Organization. The
United States has also promoted efforts to support international stability and the peaceful reso-
lution of disputes. This principled U.S. commitment has contributed significantly to the stability
and prosperity of the Asia-Pacific region today.
U.S. National Interests in the Asia-Pacific Region

The United States has a range of important national interests either located in the Asia-
Pacific region or strongly influenced by developments there. These interests include:
■■ defense of the homeland, U.S. territories, and U.S. citizens
■■ maintenance of an open, rules-based international order that enables U.S. access to re-
gional markets and encourages resolution of disputes through peaceful means rather than
coercion or the use of force
■■ access to the region and freedom of navigation in the maritime and air domains
6
■■ maintenance of a stable balance of power that supports regional stability and economic
prosperity joined with opposition to any power or group of powers that would deny U.S.
access to the region or threaten U.S. interests
■■ strengthening U.S. alliance relationships and reinforcing U.S. commitment to security

of its allies
■■ prevention of the proliferation of weapons of mass destruction and missile delivery

systems
■■ promotion of global norms and values, such as human rights, democracy, and good
governance.
Defining Trends in the Asia-Pacific Region
The Asia-Pacific region is marked by important opportunities and challenges that require
high-level attention. Economic dynamism is increasing the region’s weight in world affairs and
its importance to U.S. interests. China’s rise is part of this positive story, but Beijing is also con-
verting its astonishing economic growth into military power and diplomatic influence that are
challenging the regional balance of power and threatening the stability of the existing order. The
Obama administration responded to regional opportunities and challenges via its rebalance to
the Asia-Pacific, which sought to increase U.S. diplomatic, military, and economic engagement
there. U.S. interests merit increased strategic attention and resources, but the Donald Trump
administration will need to decide how to sustain the U.S. presence in Asia and what adjust-
ments are necessary given the changing global and regional strategic environment and the U.S.
domestic political context.
Asia’s Economic Dynamism

In 2013, the Asia-Pacific region generated close to $21 trillion in economic activity, over
a quarter of the global economy. China and Japan stand as the world’s second and third largest
economies, while the 10 countries in the Association of Southeast Asian Nations (ASEAN) have
a combined economic output of over $2.3 trillion.2 East Asia remains one of the fastest growing
regions in the world, with an annual growth rate of 6.8 percent in 2014, accounting for about 40
percent of global growth.3 This economic dynamism is increasing the region’s overall strategic
weight and importance to the U.S. economy.
7
In 2015, U.S. trade with Asia totaled more than $1.5 trillion, growing from $397 billion
at the end of the Cold War and $503 billion at the turn of the century.4 In 2014, U.S. exports to
the Asia-Pacific region represented 27.8 percent of total exports, while imports accounted for
37 percent of total imports. Capital goods, excluding automotive, led U.S. exports to the region,
amounting to 26.3 percent, while consumer goods, excluding food and automotive, accounted
for 32.2 percent of U.S. imports from the region. Meanwhile the U.S. direct investment posi-
tion in the region amounted to $738.8 billion, an increase of 6.1 percent over 2013.5 The United
States remains the single largest investor in the Asia-Pacific region.
In 2012, 32 percent of export-related jobs in the United States were tied to the Asia-Pacific
region, representing 1.2 million American jobs, an increase of more than 52 percent over 2002.
In 2011, 68 percent of all congressional districts exported more than $500 million to the region,
with 39 states sending approximately 25 percent of their exports to the Asia-Pacific region.6
Governor-led trade missions target the region’s booming economies. Top U.S. trading partners
include China (the second largest), Japan (fourth), and South Korea (sixth); if taken as a whole,
ASEAN would be the fourth largest U.S. trading partner.7
The Rise of China

China’s rise is altering the strategic landscape of the region and challenging the existing
regional order. In 1980, as Deng Xiaoping began to open China to the market, China had a $200
billion economy; by 2014, its economy topped $10 trillion. This remarkable transformation
was achieved by adopting market-oriented economic reforms and opening China to foreign
trade, investment, technology, and ideas. The result is a China that is firmly integrated into the
regional and global economy. China is now more exposed to external economic developments;
the 1998 Asian Financial Crisis and 2008 Great Recession both caused significant slowdowns
in Chinese growth.8 Conversely, China’s economy is now big enough and integrated enough
into the global economy that its economic problems can move global trade and investment pat-
terns, exchange rates, and U.S. stock markets. As China’s economy has become larger, its annual
growth rate has declined substantially (currently 6 to 7 percent) and is unlikely to return to the
previous rapid growth rates.
Like other Asian countries, China’s economic rise was enabled by an open international
trading order and stability in the Asia-Pacific region underpinned by U.S. military power and
the U.S. alliance system. A reasonably good working relationship with the United States remains
critical for Chinese goals such as sustaining economic growth and maintaining regional stabil-
ity, but the relationship has become more competitive and many Chinese elites believe that the
8
United States seeks to subvert the Chinese political system and contain China’s economic and
military potential. As China has become more powerful, and has converted some of its econom-
ic gains into military power, it has become less comfortable with the U.S. alliance system and
has begun to seek more influence within the region and in the international system as a whole.
China’s economic growth has reshaped regional trade and investment patterns and greatly
increased Beijing’s influence. China is now the number one export market for almost all coun-
tries within the region and has dramatically expanded its foreign investment across Asia. China
has a free-trade agreement (FTA) with ASEAN and is currently pursuing both a China–Ja-
pan–South Korea FTA and a broader Regional Comprehensive Economic Partnership (RCEP)
agreement. Chinese foreign aid and infrastructure projects within Asia, some of which are now
under the umbrella of Xi Jinping’s “One Belt, One Road” initiative, are another source of influ-
ence. Beijing has mostly used its economic power as assurance measures and inducements to
cooperate with China, but in recent years has become more willing to use more coercive eco-
nomic measures to punish countries that displease it.9
Rapid economic growth has also supported modernization and expansion of the Chinese
military, which has enjoyed double-digit budget increases for most of the last 20 years and now
has the largest defense budget in the Asia-Pacific region ($154 billion for 2016).10 The People’s
Liberation Army has been modernizing its forces and developing the joint doctrine, training,
and capabilities necessary to win “local wars under conditions of informationization.”11 This
modernization effort gives priority to naval, air, and missile forces capable of projecting power
beyond China’s borders and places increasing emphasis on the maritime, space, and cyber do-
mains. As part of its efforts to deter potential U.S. intervention in a Taiwan contingency, the
People’s Liberation Army has emphasized the development of antiaccess/area-denial capabili-
ties that would raise the costs and risks for U.S. forces operating near China.12 These capabilities
threaten to put at risk the U.S. ability to access its allies, extend deterrence, and meet its regional
security commitments. Expanded naval and coast guard capabilities have also supported more
assertive Chinese efforts with respect to maritime territorial disputes in the East and South
China seas.
Countries in Asia have been carefully monitoring China’s rise and the potential for a strong
China to dominate the region. Aggressive Chinese behavior toward Taiwan and in the South
China Sea from 1994 to 1996 created regional alarm about a “China threat,” but more restrained
Chinese behavior and assurance measures adopted from 1997 to 2008 helped ease regional
concerns. During this period, Asian views largely shifted from regarding China as a potential
threat to regarding China as an opportunity; this shift was widely interpreted as an indicator of
9
the success of China’s Asia policy.13 Beginning in 2009, however, more assertive Chinese behav-
ior on maritime territorial disputes and other issues dissipated much of the goodwill built by
China’s charm offensive and revived regional concerns about how a strong China might behave
in the future.14 These concerns are most acute for countries with maritime or land territorial
disputes with China, such as India, Japan, Malaysia, the Philippines, and Vietnam. Chinese
policymakers talk about the need to maintain the proper balance between the competing goals
of defending Chinese sovereignty (weiquan) and maintaining regional stability (weiwen); under
President Xi Jinping there has been more emphasis on pursuing territorial claims and less con-
cern about the negative impact on relations with China’s neighbors.
In interviews conducted as part of the Institute for National Strategic Studies research
project “The Rebalance Beyond 2016,” analysts across the region described China’s rise as “in-
exorable.” Despite the significant economic and political challenges facing China, they were
confident that China will, at worst, muddle through. Looking ahead, interviewees defined a
best-case China scenario as one in which the pace of change would slow, allowing countries of
the region to adapt and, over time, engage and socialize China toward acceptance and support
of the existing regional order. This will require sustained U.S. involvement and coordination
with regional allies and partners. For the United States and the Asia-Pacific region, China’s rise
(and international reactions to that rise) will shape the contours of the international order in
the century ahead.
While participating in the postwar Bretton Woods system and benefiting from a stable
regional order underpinned by U.S. alliances, China has moved to advance a parallel set of
institutions that mostly exclude the United States. These include the Shanghai Cooperation Or-
ganization; the initial proposal for an East Asian Summit that would have excluded the United
States; and under President Xi, the Asian Infrastructure Investment Bank; the One Belt, One
Road Eurasian trade initiative; the Regional Comprehensive Economic Partnership; and the
“Asia for Asians” security concept, widely viewed as aimed at U.S. alliances and the U.S. security
role in the region. Taken as a whole, China’s growing power and willingness to use that power to
try to alter regional security arrangements and support new institutions that advance Chinese
interests and exclude the United States pose a significant challenge to U.S. interests in the Asia-
Pacific region.
The U.S. Rebalance to Asia

Upon taking office in January 2009, Obama administration officials proclaimed a U.S. “re-
turn to Asia.” This pronouncement was backed with more frequent travel to the region by senior
10
officials and increased U.S. participation in regional multilateral meetings, culminating in the
decision to sign the ASEAN Treaty of Amity and Cooperation and to participate in the East Asia
Summit at the head-of-state level.
The strategic rebalance to Asia built on these actions to deepen and institutionalize U.S.
commitment to the Asia-Pacific region. In announcing the rebalance in a November 17, 2011,
address to the Australian Parliament, President Obama argued that “Our new focus on this
region reflects a fundamental truth—the United States has been, and always will be a Pacific
nation. . . . Here we see the future.” The President noted that Asia is “the world’s fastest grow-
ing region,” “home to more than half of the global economy,” and critical to “creating jobs and
opportunity for the American people.” He described the rebalance as “a deliberate and strategic
decision” to increase the priority placed on Asia in U.S. policy.15
Then–Secretary of State Hillary Clinton elaborated on the rationale for the rebalance,
arguing that “harnessing Asia’s growth and dynamism is central to American economic and
strategic interests” and that the United States had an opportunity to help build “a more mature
security and economic architecture to promote stability and prosperity.” Given the importance
of the Asia-Pacific region, she argued that “a strategic turn to the region fits logically into our
overall global effort to secure and sustain America’s global leadership.”16
While the main objective of the rebalance was to bring U.S. foreign policy commitments in
line with U.S. interests, it also responded to China’s increasingly assertive regional policies, es-
pecially on maritime territorial disputes. Countries across the Asia-Pacific region urged Wash-
ington to play a more active role in regional economic, diplomatic, and security affairs in order
to demonstrate U.S. commitment and help maintain regional stability in the face of a more
powerful and more active China.
Obama administration officials stressed that the rebalance includes diplomatic, economic,
and military elements, all of which must be applied in a coordinated manner for maximum
effect.17 The diplomatic element involved enhanced high-level diplomatic engagement, includ-
ing frequent travel to the region by the President, Secretary of State, and Secretary of Defense.
President Obama participated regularly in Asia-Pacific Economic Cooperation (APEC) and
East Asia Summit meetings; had periodic meetings with the leaders of U.S. allies Japan, South
Korea, and Australia; and launched a new U.S.-ASEAN dialogue mechanism that included a
summit with Southeast Asian leaders at Sunnylands, California, in February 2016.
American allies and partners in the region have stressed U.S. economic engagement with
Asia as a key means of demonstrating U.S. staying power. The Obama administration faced a
number of practical and political obstacles in increasing U.S. trade and investment ties with
11
the Asia-Pacific, especially in the context of the global financial crisis. The centerpiece of the
administration’s efforts was the Trans-Pacific Partnership (TPP), as “an ambitious, next-gen-
eration Asia-Pacific trade agreement” including Australia, Brunei Darussalam, Canada, Chile,
Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States, and Vietnam.18 The
TPP agreement was signed on February 4, 2016, but will not take effect until all member coun-
tries have ratified the agreement. Facing strong political headwinds in both the Republican and
Democratic parties, the Obama administration did not submit the agreement to Congress for
approval. On January 23, 2017, President Trump, by executive order, withdrew the United States
from participation in TPP.
The military element of the rebalance aimed to increase commitments of U.S. military
forces to the Asia-Pacific region and enhance military and security cooperation with a range
of allies and partners. The Navy and Air Force both announced plans to devote 60 percent of
overseas-based forces to the Asia-Pacific region, including deployments of advanced systems
such as the Littoral Combat Ship and F-35 Joint Strike Fighter. The Army announced plans to
align 70,000 troops to Asia missions, while the Marines announced plans for rotational deploy-
ments of 2,500 Marines to Australia. Then–Secretary of Defense Ashton Carter described a
three-part Department of Defense approach to the “next phase” of the rebalance that included
investing in future capabilities relevant to the Asia-Pacific security environment, fielding key
capabilities in quantity, and adapting the U.S. defense posture to be “geographically distributed,
operationally resilient, and politically sustainable.”19 A significant part of the rebalance involved
efforts to expand military cooperation with traditional allies such as Australia, Japan, and South
Korea, while using exercises and dialogues to reach out to nontraditional partners such as India,
Malaysia, and Vietnam.20
While President Obama’s remarks set out a comprehensive strategy toward the region, the
initial public diplomacy rollout focused on the military aspects, unfortunately playing into the
Chinese conceit that U.S. policy is aimed at containing China. Beijing has subsequently gone
a step further, blaming the rebalance for increasing tensions in the region even though it was
partly a response to regional concerns about increasing Chinese assertiveness.
Asia-Pacific Security Challenges

Asia’s economic dynamism, China’s rising power, and the U.S. rebalance are broad trends
that are having a major impact on the Asia-Pacific region as a whole. These trends co-exist with
a number of specific security challenges in Northeast Asia, the Korean Peninsula, the China-
Taiwan relationship, and the South China Sea, including unresolved territorial disputes, com-
12
petition to secure natural resources, and freedom of navigation issues that present complex
challenges to regional stability and security.
Northeast Asia
Even 75 years after the end of World War II, tensions over the history of Japanese colo-
nialism and aggression continue to complicate Tokyo’s relations with Beijing and Seoul. The
Japan-China relationship is also marked by conflicting territorial claims in the East China Sea,
including disputes over possession of the Senkaku/Diaoyu Islands, an unresolved maritime
boundary, and resource competition for fish, oil, and natural gas. Both China and Japan claim
the islands (as does Taiwan), and tensions over them have flared periodically since the late
1970s.21 The United States does not take a position on the sovereignty dispute but recognizes
Japanese administrative control and has stated that the unpopulated islands are covered under
the U.S-Japan Security Treaty.
In September 2010, a Chinese fishing trawler operating within Japan’s exclusive economic
zone north of the Senkaku Islands collided with two Japanese coast guard ships. The ships pur-
sued and boarded the trawler, taking into custody the captain and crew. Tokyo took the position
that the coast guard’s actions were correct, taking place in Japanese waters and based on Japanese
law. Beijing’s response was to call on Japan to refrain from taking “so-called law enforcement ac-
tivities” in Chinese waters. To have accepted the legality of the coast guard’s action would have
been to compromise China’s claim to sovereignty over the islands. The rapid deterioration of
relations that followed, China’s suspension of rare-earth metal exports to pressure the Japanese
business community, widespread anti-Japanese demonstrations across China, and small-scale
anti-Chinese protests in Japan all underscored the sensitive nature of the territorial issue.
Two years later, in September 2012, the Japanese government purchased (“nationalized”)
three of the five Senkaku islands from their private-sector owner. Widespread anti-Japanese
demonstrations spread across China, and Beijing suspended all high-level political and dip-
lomatic contacts. To assert its claims to the islands, China stepped up patrols of white-hulled
paramilitary ships (now consolidated into the Chinese coast guard) into the contiguous zone
around the islands, establishing an almost daily presence in the area. Chinese ships also entered
the 12 nautical miles’ territorial waters limit in the Senkakus. By the end of 2013, Chinese coast
guard ships had entered territorial waters in the Senkakus 256 times. Of the incursions, 68 took
place in the period September‒December 2012 and 188 in 2013.22 In November 2013, China
declared an Air Defense Identification Zone that extended over the Senkaku Islands. The fol-
13
lowing month the government of Prime Minister Shinzo Abe, in its national security strategy,
defined Japan’s security environment as “ever more severe.”23
Japan and China also hold conflicting claims over the maritime boundary in the East Chi-
na Sea. Japan claims a mid-line boundary in the East China Sea, while Beijing’s claim is based
on the continental shelf and extends beyond the mid-line to the Okinawa trough. In the context
of this unresolved boundary, exploration for oil and natural gas has also served as a flashpoint.
In June 2008, Japanese and Chinese diplomats reached agreement on the joint development of
resources in the East China Sea; implementing details were left to follow-on talks, which have
failed to resolve outstanding issues. In June 2013, China began the construction of large explo-
ration platforms on the Chinese side of the mid-line boundary. Tokyo considered the Chinese
action to be at odds with the 2008 agreement and an “attempt to change the status quo unilat-
erally.” Beijing’s response was to make clear that exploration was taking place within China’s
sovereign waters, that China and Japan have yet to reach agreement on the maritime boundary,
and that China does not recognize Japan’s unilateral boundary demarcation. The Japanese press
reported that Prime Minister Abe raised the issue twice with President Xi in November 2014
and April 2015 meetings.
North Korea
North Korea, as it has for decades, remains the most destabilizing element in the Asia-
Pacific security environment. Pyongyang’s growing nuclear and missile arsenal poses a direct
threat to U.S. national security interests. Senior U.S. defense officials have stated that North Ko-
rea, within a decade, will be able to deploy intercontinental ballistic missiles capable of reaching
U.S. territory in the Pacific and the homeland itself.24
North Korea’s estimated 1.2 million-man conventional army also continues to pose a di-
rect threat to the Republic of Korea, a treaty ally of the United States. North Korean provoca-
tions, such as the sinking of the ROK navy’s warship Cheonan in March 2010, the shelling of
Yeonpyeong Island in November 2010, and the August 2015 incident at the demilitarized zone
(DMZ), risk escalation into a wider conflict. Pyongyang remains committed to the unification
of the Korean Peninsula on its terms.
Diplomatic efforts to address North Korea’s nuclear program have a long history. Begin-
ning in 1991, then–Under Secretary of State Arnold Kanter met with North Korean diplomats
in New York and proposed the basic tradeoff that has marked diplomatic efforts since: abandon-
ment of North Korea’s plutonium-based nuclear program in exchange for an array of security
guarantees and economic benefits. The initiative eventually played out into the 1994 Agreed
14
Framework, which offered Pyongyang two light water reactors, a security guarantee, and moves
toward normalized relations. Profound distrust on both sides gradually unraveled the accord,
which collapsed in 2002 when the George W. Bush administration discovered that Pyongyang
was secretly pursuing uranium enrichment as an alternative path to the bomb.
In August 2003, China launched the Six Party Talks to reduce the risk of unilateral U.S.
military action and to keep denuclearization of North Korea on the security agenda. The talks
produced the September 19, 2005, agreement, yet another attempt at a grand bargain. The Six
Party Talks collapsed in December 2008 when North Korea failed to produce details of its nu-
clear activities that would verify compliance with the agreement. Efforts to revive the Six Party
Talks have proved unavailing.
In 2009, the Obama administration attempted to break the diplomatic deadlock, offer-
ing to extend an open hand to North Korea. North Korea answered with ballistic missile and
nuclear weapon tests. Nevertheless, the administration continued to pursue a diplomatic open-
ing to Pyongyang, which resulted in the February 29, 2012, Leap Day agreement, a mini-grand
bargain in which the United States would provide food in return for North Korea’s freezing of
its missile and enrichment programs. Pyongyang responded with another ballistic missile test.
In 2012, the nuclear and missile programs were enshrined in North Korea’s revised con-
stitution. Today, under the leadership of 30-something Kim Jong-un, North Korea is pursuing
byungjin, a two-track policy aimed at sustaining its nuclear weapons and missile programs and
simultaneously promoting economic growth—in short, guns and butter. Pyongyang has made
very clear that it has no interest in surrendering its nuclear program, even for an economic
windfall. Instead it seeks international recognition as a nuclear weapons state.
Uncertainties about the long-term life expectancy of the regime under Kim Jong-un, in-
cluding the prospect of instability or regime collapse, raise daunting security challenges.25 China
might intervene to prop up a failing regime, to prevent a refugee crisis from spilling over its bor-
ders, or to secure North Korea’s weapons of mass destruction. Similar conditions could prompt
the ROK to cross the 38th parallel in an effort to unify the peninsula or the United States to inter-
vene to secure North Korea’s weapons of mass destruction. The prospects for strategic miscalcu-
lation in a fast-moving, dynamic environment are extremely high, especially given the absence of
substantive dialogue between the United States and China about contingency responses.
China-Taiwan
The political dispute between Mainland China and Taiwan remains an unresolved legacy
of the Chinese civil war. The People’s Republic of China (PRC) claims Taiwan as an inherent
15
part of Chinese territory. While pursuing a policy of unification through peaceful development,
Beijing has refused to renounce the use of force if Taiwan should pursue de jure independence.
Even as economic integration has deepened to the point where Mainland China is now Taiwan’s
number one export market and the main destination for Taiwan investment, political trends
have continued to diverge.
On the mainland, the narrative of a “century of humiliation” at the hands of foreign powers
makes Taiwan reunification a benchmark goal for Chinese nationalism and a domestic political
third rail where top leaders have little room to compromise. Conversely, democratization and
social changes on Taiwan have reduced the political dominance of the mainlanders who fled the
Communist takeover in 1949 and produced a population with less sense of a Chinese identity
and little desire for closer political relations with Mainland China, much less unification with
a country led by a communist government. Despite an increasing sense of an identity separate
from the Mainland, the pragmatic population on Taiwan prefers to maintain the political status
quo and avoid pro-independence actions that might provoke hostile PRC responses.
U.S. policy is based on three communiques signed with the People’s Republic of China
and the 1979 Taiwan Relations Act. U.S. policy recognizes the PRC government as the sole legal
government of China, acknowledges the Chinese position that there is but one China and that
Taiwan is part of China, and maintains cultural, commercial, and other unofficial relations with
the people on Taiwan. At the same time, U.S. policymakers have clearly and consistently stated
that the United States does not support Taiwan independence. The Taiwan Relations Act pro-
vides the legal basis for U.S. unofficial relations with Taiwan and enshrines a U.S. commitment
to assist Taiwan in maintaining its defensive capability. It also states that peace and stability
in the Western Pacific area “are in the political, security, and economic interests of the United
States, and are matters of international concern” and that U.S. policy is to “maintain the capacity
of the United States to resist any resort to force or other forms of coercion that would jeopardize
the security, or the social or economic system, of the people on Taiwan.”
U.S. policy is focused on maintaining a framework within which the two sides of the strait
can work out their political differences rather than on achieving specific outcomes. Accordingly,
the United States insists on peaceful resolution of cross-strait differences, opposes unilateral
changes to the status quo by either side, and encourages cross-strait dialogue to help advance
a peaceful resolution. This approach has helped the United States cooperate with the PRC on
a range of global, regional, and bilateral economic and security issues while maintaining ro-
bust unofficial ties with the people on Taiwan. However, the growing imbalance in economic
and military power between China and Taiwan poses challenges for the viability of this policy
16
framework, especially as Chinese military modernization expands the coercive tools available
to PRC leaders.
Contentious cross-strait relations improved considerably from 2008 to 2016 under Taiwan
President Ma Ying-jeou, whose willingness to endorse the so-called “1992 consensus” (which
he interpreted as “one China, separate interpretations”) reduced tensions and permitted a major
expansion of cross-strait economic ties, establishment of direct air and sea links, and the sign-
ing of 23 cross-strait agreements. Ma resisted pressure from Mainland China to engage in talks
on political issues or to define Taiwan’s status more precisely. Although this period saw stability
and a significant expansion in cross-strait contacts, many on Taiwan claimed that the economic
benefits went largely to politically connected big businesses and that the Ma administration did
not stand up enough for Taiwan’s interests.
Opposition Democratic Progressive Party candidate Tsai Ing-wen won a decisive victory
in January 2016 elections; her party won control of the legislature for the first time and she took
office as president on May 20, 2016. Mainland China is suspicious of Tsai because of her party’s
pro-Taiwan independence stance and her service in former president Chen Shui-bian’s govern-
ment, although she has pledged not to challenge the status quo and has made subtle policy ad-
justments to reassure Beijing that she will not take pro-independence actions that might disrupt
stability.26
Nevertheless, Mainland China officials have insisted that Tsai explicitly acknowledge that
Taiwan is part of China and endorse the 1992 consensus, a concession she is unwilling (and per-
haps unable) to make. A March 2016 Center for Strategic and International Studies delegation
to China and Taiwan concluded that China is deliberately setting the bar high because it wants
Tsai’s term in office to be considered a failure. To that end Beijing has severed semi-official
cross-strait dialogue mechanisms, reduced the flow of tourists to Taiwan, and taken actions to
curtail Taiwan’s international space, including by inducing some of Taiwan’s 21 diplomatic allies
to shift recognition to the PRC.27 Beijing’s strategy appears to be to blame Tsai for a downturn
in cross-strait relations that damages Taiwan’s economy, and to hope that Taiwan voters choose
a candidate committed to improving cross-strait relations in the 2020 election.
This all suggests that cross-strait relations will enter a period of greater turbulence with
Beijing seeking to depict Tsai as challenging the status quo by refusing to endorse the 1992 con-
sensus and Tsai and her government looking to Washington for support in the face of increasing
Chinese pressure. At the same time, Beijing knows that any attempt to resolve the Taiwan issue
with force would have extremely high costs and risks (including the likelihood of U.S. military
intervention) and would severely damage China’s relations with the United States and other
17
major countries in the region. President-elect Trump’s decision to accept a phone call from
President Tsai and subsequent suggestions that the Trump administration might reevaluate the
longstanding U.S. “One China” policy created uncertainty about the administration’s policy.
This may have been a tactical maneveur to seek leverage in dealing with Beijing. President
Trump subsequently reaffirmed U.S. commitment to its “One China” policy.28
South China Sea

In contrast to the East China Sea, competing territorial claims and maritime boundaries
in the South China Sea involve multiple parties. The disputes center on three sets of overlap-
ping claims. China, Taiwan, and Vietnam all claim the Paracel Islands, which China occupied
in 1974 during the last days of the Republic of Vietnam. China, the Philippines, and Taiwan
claim Scarborough Shoal, site of a 2012 dispute between Beijing and Manila. China, Taiwan,
and Vietnam claim all the land features in the Spratly Islands, while Brunei, Malaysia, and the
Philippines each claim a number of specific features. China has not clarified the exact nature
or legal basis of its claim to land features and adjacent waters inside the “nine-dash line” that
it inherited from the Republic of China. The nine-dash line overlaps with part of Indonesia’s
exclusive economic zone claim, including part of the Natuna natural gas field.
In 2002, the member states of ASEAN and China adopted the “Declaration on the Conduct
of Parties in the South China Sea” to address conflicting claims. In the document, the parties:
■■ reaffirmed “their respect for and commitment to the freedom of navigation in and over-
flight above the South China Sea as provided for by the universally recognized principles
of international law, including the 1982 UN [United Nations] Convention on the Law of
the Sea”
■■ undertook “to resolve their territorial and jurisdictional disputes by peaceful means,
without resorting to the threat of or use of force”
■■ undertook “to exercise self-restraint in the conduct of activities that would compli-
cate or escalate disputes and affect peace and stability including, among others, refraining
from . . . inhabiting . . . the presently uninhabited islands, reefs, shoals, cays, and other
features and to handle their differences in a constructive manner.”29
18
Finally, the parties reaffirmed that “the adoption of a code of conduct in the South China
Sea would further promote peace and stability” and agreed “to work, on the basis of consensus,
toward the eventual attainment of this objective.”
A binding code of conduct today stands as a distant vision, and much has transpired that
is at odds with the spirit of the Declaration of Conduct. Claimants have used a variety of tactics
to reinforce their claims, with a significant increase in activity since 2009.30 Tactics to assert
sovereignty include patrols by coast guard and naval forces, occupying land features, enforcing
fishing regulations in disputed waters, oil and natural gas exploration, harassment of military
ships and aircraft operating in disputed areas, and using legal means (such as the case the Phil-
ippines brought against China in the International Tribunal of the Law of the Sea). None of the
claimants has clean hands, but China has been the most active in using military and paramili-
tary means to assert its claims, including by coercion of other claimants.31 Since 2009, China has
become more assertive in enforcing its claims, including harassment of U.S. military ships and
aircraft operating legally in international waters or within China’s exclusive economic zone. In
May 2014, China deployed an oil rig into waters in the Paracels claimed by Beijing and Hanoi,
raising tensions and setting off collisions between Chinese and Vietnamese coast guard ships
and virulent anti-Chinese demonstrations in Vietnam.
In 2013, China began land reclamation projects in the South China Sea on several low-tide
elevations, geologic features that do not extend above water at high tide. China’s efforts at land
reclamation were not unprecedented: Malaysia, the Philippines, Taiwan, and Vietnam have also
engaged in such projects since the 1980s. The U.S. Department of Defense Maritime Security
Strategy notes that, in the period from 2009 to 2014, Vietnam “was the most active claimant in
terms of both outpost upgrades and land reclamation,” adding “approximately 60 acres of land
at 7 of its outposts and [building] at least 4 new structures as part of its expansion efforts.”32
However, China’s land reclamation activities dwarf those of other claimants. By June 2015,
China’s land reclamation projects totaled “more than 2,900 acres, or 17 times more land in 20
months than the other claimants combined over the past 40 years, accounting for approximately
95 percent of all reclaimed land in the Spratly Islands.” In comparison Vietnam had reclaimed
“a total of approximately 80 acres, Malaysia, 70 acres; the Philippines, 14 acres; and Taiwan, 8
acres.”33 In October 2015, President Xi pledged that China would not “militarize” the islands
that it had constructed, but the exact nature of this commitment is vague and most observ-
ers expect China to use the airfields and port facilities that it is building for both military and
civilian purposes. Beijing’s position remains that “China has indisputable sovereignty over the
Nansha islands and their adjacent waters,” with “sovereignty and relevant rights . . . formed over
19
the long course of history and upheld by successive Chinese governments.”34 However on July
12, 2016, the Permanent Court of Arbitration, in a case brought by the Philippines contesting
Chinese claims in the South China Sea, ruled in favor of Manila and rejected most of Beijing’s
claims.
U.S. policy has been to avoid taking sides in the sovereignty disputes, but to stress the im-
portance of respect for international law and peaceful resolution of disputes without coercion.
China’s successful use of incremental salami tactics to expand its effective control of disputed
maritime territory in the South China Sea has brought this approach into question, as Beijing
has been able to “work around” the United States to gradually expand its naval and coast guard
presence and power projection capabilities while avoiding the use of lethal force. More recently,
the United States has adjusted its policies to increase security assistance to help improve mari-
time domain awareness of U.S. allies and partners and has also reinvigorated its Freedom of
Navigation program, which challenges excessive or illegitimate maritime claims.35
Sustaining U.S. Presence

U.S. policies must take the broad trends of Asia’s economic dynamism, China’s rising
power, and the U.S. rebalance into account even as they grapple with specific regional security
challenges. We believe the correct strategy is to work with U.S. allies, partners, and multilateral
organizations to build a rules-based regional order that includes China and advances U.S. eco-
nomic, security, and political interests. This requires sustaining the U.S. presence in the Asia-
Pacific and intensifying cooperation with other regional actors to shape China’s choices and
make it pay a price for aggressive actions that violate international rules and norms.
For over a half century, the U.S. system of bilateral security alliances (with Australia, Japan,
the Philippines, the Republic of Korea, and Thailand) has served as the informal security archi-
tecture of the Asia-Pacific region, underpinning stability and enhancing economic prosperity.
Although most countries in the region share concerns about how China is using its power (and
especially about its aggressive pursuit of its maritime territorial claims), they are reluctant to
choose between China (a critical economic partner) and the United States or to participate in
security cooperation aimed against China. Given the diversity of the region in terms of political
culture and security interests, a formal alliance system such as the North Atlantic Treaty Orga-
nization has been widely recognized as impractical.
The best approach is to build on the existing bilateral alliance system by encouraging in-
creased cooperation between U.S. allies, engaging other regional security partners, and shap-
ing the evolution of regional organizations through active U.S. participation. U.S. policymakers
20
must recognize China is a powerful country that is also attempting to reshape the regional order
in directions favorable to its interests. Not all Chinese interests run counter to U.S. goals. For
instance, the two governments share an interest in combatting piracy and illegal trafficking. But
China’s reluctance to accept multilateral rules that restrict its ability to exercise power or to ad-
dress sovereignty disputes in a multilateral setting will limit the appeal of most Chinese propos-
als. An open, rules-based regional order that includes the United States will be more attractive
to Asia-Pacific countries than Chinese-backed alternatives.
Strengthening Alliances
To address the security challenges in 2017‒2021 and beyond, a critical first step for the
Trump administration is to focus on strengthening the bilateral alliance structure. This starts
with the U.S.-Japan Alliance.
Japan. For over half a century, the alliance with Japan has served as the foundation of U.S.
strategy toward the Asia-Pacific region and an integral element of U.S. global strategy. Elements
of the Seventh Fleet based in Yokosuka, Japan, were among the first U.S. units to support coali-
tion efforts in the Persian Gulf War in 1991 and Operation Enduring Freedom in 2001.
Under the government of Prime Minister Abe, Japan has taken steps to enhance security
cooperation with the United States. In December 2013, the Abe government released Japan’s
first-ever national security strategy, which defined Japan as a “Proactive Contributor to Peace”
in support of international stability and security. The document set out three objectives for
Japan’s security policy: to strengthen deterrence, to strengthen the Japan-U.S. Alliance, and to
strengthen the rules-based international order. In July 2014, a decision by the Japanese govern-
ment cabinet reinterpreted Japan’s constitution to allow for the exercise of the right of collective
self-defense.
In April 2015, the Obama administration and the Abe government released the Revised
Guidelines for Defense Cooperation. The new guidelines aim to enhance U.S.-Japan Alliance
cooperation by providing for an Alliance Coordination Mechanism; closer operational coordi-
nation; a whole-of-government, upgraded bilateral planning mechanism; seamless coordina-
tion of efforts “to ensure Japan’s peace and security in all phases, from peacetime to contingen-
cies”; and defense equipment and technology cooperation as well as cooperation in space and
cyberspace. The limiting geographic reference to “Situations in Areas Surrounding Japan” in
the 1997 guidelines was omitted, theoretically expanding the scope of alliance-based security
cooperation.
21
Of increasing concern to Japan is the potential for “gray zone” activities, attempts to change
the status quo by limited use of force or coercion such as China’s frequent incursions into Ja-
pan’s sovereign waters and air space that could cause “unexpected situations” and challenge the
alliance in response. In April 2014, President Obama made clear that Article V of the alliance
extends to the Senkaku Islands given Japan’s administrative control. To strengthen deterrence,
it is critical for the Trump administration to be seen actively planning and exercising with Ja-
pan’s Self-Defense Forces to deal “seamlessly” with gray zone situations that could arise in the
Senkaku Islands.
With respect to North Korea’s growing missile threat, Japanese strategists are concerned
with the potential for “decoupling,” the result of a North Korea inclined to engage in provoca-
tions, confident that its nuclear arsenal would preclude a U.S. response. Japanese strategists are
also concerned with the deterrence challenge posed by China at both the regional and strategic
levels.
Implementation of the new defense guidelines, in particular the U.S. commitment “to ex-
tend deterrence to Japan through the full range of capabilities, including U.S. nuclear forces”
and to continue forward deployment in the Asia-Pacific region will be critical to sustaining
Japanese confidence in the alliance. Implementation of the guidelines will be a critical test both
of the Trump administration’s commitment to the alliance and to the rebalance.
Across the region, the strength of the U.S.-Japan Alliance as well as the U.S. commitment
to the defense of the Republic of Korea are widely perceived as a barometer of the U.S. security
commitment to the Asia-Pacific region.
The Republic of Korea. For over 60 years, the U.S. alliance with the Republic of Korea
has succeeded in deterring North Korea from again attempting to unify the Korean Peninsula
by force of arms. The resulting armed peace has allowed for a political evolution to take place
in which the Korean people have transformed an authoritarian political system into a vibrant
democracy, while allowing the native energies of the Korean people to flourish and develop a
dynamic market economy with an international presence.
At the same time, the threat posed by North Korea to the security of the ROK and the
broader international community remains. The sinking of the ROK navy corvette Cheonan in
March 2010, the shelling of Yeonpyeong Island in November 2010, and the August 2015 land-
mine incident at the DMZ underscore North Korea’s continuing hostility.
While North Korea’s conventional capabilities have continued to degrade, the threat posed
by its nuclear weapons and missiles is increasing at an accelerating pace. Since the September 19,
2005, Six Party Talks agreement on denuclearization, North Korea has conducted five nuclear
22
tests (in October 2006, May 2009, February 2013, January 2016, and September 2016); each test
was followed by UN Security Council–imposed sanctions. Meanwhile North Korea continues
to develop and test a ballistic missile arsenal. In October 2014, U.S. Forces Korea commander
General Curtis Scaparrotti, USA, cautioned that North Korea may have developed a miniatur-
ized nuclear warhead and mated the warhead to missiles capable of striking U.S. territory.
North Korea’s evolving nuclear and missile capabilities raise issues related to deterrence
and defense, affecting both the ROK and Japan.36 Defense planners are concerned that “newly
nuclear states often are more assertive at the conventional level because of their confidence in
being able to deter a strong adversary response with their nuclear means.”37 To address this
potential risk, the ROK and the United States reached agreement on a Counter-Provocation
Plan in March 2013. The plan was employed during the August 2015 DMZ landmine incident.
Updating the Counter-Provocation Plan to deal with the evolving threats posed by North Korea
will be an important alliance management instrument for the Trump administration.
Enhancing missile defense will also be a critical alliance issue for the new administra-
tion. In July 2016, the United States and the ROK agreed to deploy the Terminal High Altitude
Area Defense (THAAD) system to the ROK. The deployment will defend against North Korean
missile attacks, and open the door to the development of an interoperable U.S.-ROK-Japan
multilayered missile defense system that would enhance defense and deterrence in Northeast
Asia. China, however, has expressed concerns that the U.S. deployment of the THAAD system
in South Korea could put China’s nuclear deterrent at risk and aggravate tensions on the penin-
sula. In July 2014, President Xi Jinping reportedly told President Park Geun-hye that THAAD
deployment on the peninsula “went against China’s security interests.”38 After the deployment
decision, China expressed “firm opposition” and has applied economic and diplomatic pressure
on the ROK to reconsider. U.S. and ROK policymakers will need to stand firm in the face of
Chinese pressure.
Meanwhile, efforts to implement the September 19, 2005, Six Party agreement on the de-
nuclearization of North Korea remain on diplomatic life support. In April 2009, North Korea
announced its withdrawal from the Six Party Talks and subsequently made clear that its nuclear
arsenal will not be used as a bargaining chip to secure economic benefits.
The Trump administration should take the long view with respect to North Korea—not all
problems will be solvable within its term in office. Available military options are unattractive
given the vulnerability of U.S. allies to attack by North Korean long-range artillery and missiles
armed with nuclear warheads. Given North Korea’s history of cheating, a negotiated freeze on
nuclear and missile testing that does not include intrusive verification measures is unlikely to
23
permanently constrain the North Korean intercontinental ballistic missile program and would
likely require concessions that would reduce U.S. ability to deter and defend its allies against a
North Korean attack.
The most effective policy may be to strengthen deterrence and defense of the ROK and
Japan, maintain the external pressure of economic sanctions, and keep the door open to dia-
logue and diplomacy aimed at the denuclearization of North Korea as agreed to by Pyongyang
in the September 2005 Six Party statement. To deal with the possibility of instability or regime
collapse, the Trump administration should work to closely coordinate U.S. and ROK objectives,
endstates, and policy responses and try to engage China in discussions of responses to various
contingencies. To date China has considered such official-level discussion to be premature.
The Philippines. In 1992, after the Philippine senate rejected an extension of the basing
agreement, the United States closed Clark Air Base and the Subic Bay Naval Base and withdrew
its military forces from the Philippines. U.S. military assistance resumed after 9/11, directed to
support Manila’s counterterrorism efforts in Mindanao and the southernmost islands.
As Philippine concerns about China have increased, Manila has become more willing to
expand security cooperation. In 2011, the United States agreed to support programs aimed at
enhancing its maritime security capabilities. In 2012, the Balikatan joint exercise took place off
Palawan Island, near the contested Spratly Islands in the South China Sea. The United States
also transferred two former Coast Guard ships to the Philippines. In 2014, Washington and
Manila signed the Enhanced Defense Cooperation Agreement, aimed at “addressing short-term
capability gaps, promoting long-term modernization, and helping maintain and develop addi-
tional maritime security, maritime domain awareness, and humanitarian assistance and disaster
relief capabilities.”39 During his visit to the Philippines in 2014, President Obama made clear
that the U.S. commitment “to defend the Philippines is ironclad and the United States will keep
that commitment because allies never stand alone.” Obama reiterated the “ironclad commit-
ment” formulation during his 2015 visit to the Philippines. Despite new Philippine President
Rodrigo Duterte’s recent remarks questioning the value of security cooperation with the United
States, U.S. policymakers should exercise patience and remain focused on the long-term inter-
ests of both countries.
Moving Beyond the Hub-and-Spokes Alliance System

Since the turn of the century, the U.S. alliance structure has been evolving from the
Cold War bilateral hub-and-spokes construct toward a more open architecture that includes
increased cooperation between U.S. allies and active efforts to engage other regional security
24
partners. The United States has supported increased bilateral security cooperation between U.S.
allies, most notably between Australia and Japan and Japan and the Philippines; trilateral co-
operation among Australia, Japan, and the United States and among Japan, the ROK, and the
United States; and quadrilateral engagement involving Australia, India, Japan, and the United
States. Exercises that began in the context of U.S. bilateral alliances have expanded to include a
wide range of regional participants, including China (which participated in the 2014 and 2016
Rim of the Pacific exercises).
At the same time, the United States has developed Comprehensive Partnerships with In-
donesia, Malaysia, and Vietnam and a Strategic Partnership with Singapore. Japan and Austra-
lia, both U.S. allies, have developed similar partnerships with Indonesia, Malaysia, Singapore,
and Vietnam. U.S. security cooperation with India has deepened to the point where the two
countries have become “major defense partners,” and the United States has encouraged India to
expand its diplomatic and security role in Southeast Asia and the South China Sea. These non-
alliance partnerships help to enhance broad-based regional security cooperation and contribute
to stability.
Maritime territorial disputes are among the most difficult regional security challenges.
These disputes are sensitive domestic political issues (but not existential interests) for all the
claimants. China’s efforts to use military and paramilitary means to expand its effective control
of disputed territories and waters pose a challenge to key U.S. interests and principles such as
peaceful resolution of disputes, respect for international law, and freedom of navigation.
Australia, Japan, and the United States have all increased their focus on maritime issues
in Southeast Asia and the South China Sea, including maritime capacity-building, maritime
domain awareness, joint training and exercising, and port calls. In 2013, the United States com-
mitted $156 million (2014‒2015) to support maritime capacity-building in Southeast Asia, in-
cluding $18 million to Vietnam.40 In November 2015, the White House announced its intention
to enhance capacity-building efforts by committing more than $250 million over the 2015‒2016
period, focused on Indonesia, Malaysia, the Philippines, and Vietnam.41
In November 2015, Japanese and Vietnamese ministers of defense agreed to strengthen
defense cooperation, including joint maritime exercise and a 2016 port call at Cam Ranh Bay by
Japan’s Maritime Self-Defense Force. Earlier, in 2006, Japan, making strategic use of its Official
Development Assistance program, sent three patrol boats to Indonesia and in 2012 transferred
10 Japanese Coast Guard ships to the Philippines. Similarly Australia has used the Pacific Patrol
Boat Program to donate aging Australian ships to South Pacific and Southeast Asian neighbors.
25
The United States should continue to resist pressure to take sides in sovereignty disputes
and maintain an even-handed approach. However, when countries, including China, take ac-
tions that we view as inconsistent with international law, the United States should impose costs,
including via official statements, diplomatic efforts to organize opposition to illegal or destabi-
lizing actions, and enhancing security cooperation with regional allies and partners. The United
States must maintain its military capabilities and be willing to act to assert its own interest in
freedom of navigation, including by military activities that challenge excessive maritime claims.
If carried out on a routine basis, there will be less need to publicize each freedom of naviga-
tion operation. Ratifying the United Nations Convention on the Law of the Sea, which the U.S.
signed in 1982 and regards as customary international law, would strengthen the legitimacy of
U.S. diplomatic efforts to defend freedom of navigation.
Enhancing maritime capacity-building efforts in Southeast Asia will be an important
benchmark of the Trump administration’s commitment to regional stability and security. At the
same time, given the diversity and complexity of the Asia-Pacific region, alliances and partner-
ships should not be viewed as being exclusively threat-centric. They can also play an important
role in building regional order by strengthening cooperation in dealing with nontraditional
security issues, thereby enhancing confidence among states. Efforts to work with allies and part-
ners in enhancing regional security cooperation will strengthen U.S. political and diplomatic
leadership in the region.
Shaping the Asia-Pacific Order

Scholars have long argued that the Asia-Pacific region lacks the web of multilateral orga-
nizations that have facilitated European integration. Explanations for Asia’s under-institution-
alization include the region’s economic and cultural diversity, mutual suspicions between coun-
tries, and the impact of Cold War political divisions. In 1967, the governments of Indonesia,
Malaysia, the Philippines, Singapore, and Thailand came together to create ASEAN. For over
two decades, ASEAN stood as the lone multilateral institution in the region. However, recent
decades have seen the creation of new regional organizations and meetings that may become
building blocks for a new regional order.
As the Cold War was ending in 1988, Malaysia’s Prime Minister Mohammed Mahathir ad-
vanced the concept of an East Asia Economic Caucus that would exclude the United States. U.S.
opposition doomed the caucus, but in 1989 Australia, with strong U.S. support, established the
Asia-Pacific Economic Cooperation forum to advance regional trade liberalization. With the
establishment of APEC, Asian multilateralism gathered momentum. In 1993, ASEAN created
26
the ASEAN + 3 (China, Japan, South Korea) format, followed by the ASEAN Regional Forum
in 1994, the East Asian Summit in 2005, and the ASEAN Defense Ministers Meeting Plus in
2010—ASEAN plus Australia, China, India, Japan, New Zealand, the ROK, Russia, and the Unit-
ed States. In addition, the annual Shangri-la Dialogue sponsored by the International Institute
for Strategic Studies in Singapore has served as a high-level multilateral forum for the discussion
of political and security issues.
In 2008, the Bush administration appointed the first U.S. Ambassador to ASEAN, a clear
recognition of the growing importance of ASEAN and of the region’s expanding multilateral,
diplomatic, economic, and security forums. One explicit goal of the rebalance was to increase
the U.S. ability to help shape the emerging multilateral architecture in the Asia-Pacific region.
The Obama administration paid particular attention to high-level participation in the region’s
multilateral institutions and dialogues, with the President, Secretary of State, and Secretary of
Defense regularly attending meetings in Asia. Countries across the region welcomed the Obama
administration’s sustained high-level attention, but are concerned whether the Trump adminis-
tration will place an equally high priority there. U.S. interests would be best served by continued
high-level U.S. participation and active U.S. engagement in efforts to shape the regional order.
The Trans-Pacific Partnership and U.S. Trade with Asia

The priority that almost all Asia-Pacific governments place on economic growth means
that trade and investment agreements are a critical aspect of international relations in Asia
and important building blocks for the emerging regional order. If the United States is not ac-
tively engaged, other countries will be allowed to shape regional economic rules, norms, and
standards in ways that may work against U.S. interests. The centerpiece of the Obama regional
economic agenda was the Trans-Pacific Partnership, described as a “gold-standard” free trade
agreement involving 10 countries.
President Trump’s decision to withdraw from TPP and pursue a trade policy based on
bilateral negotiations will reduce the U.S. ability to shape evolving regional economic rules.
In interviews across the region over the past 2 years, political leaders, diplomats, and military
officials all underscored the strategic importance of TPP as a benchmark of long-term U.S.
commitment to the region. As the new administration attempts to to address U.S. trade deficits
via bilateral negotiations, it should keep in mind the importance of maintaining U.S. economic
access to the Asia-Pacific region and sustaining an open trading order based on World Trade
Organization rules.
27
China Policy: Managing a Mixed Relationship
One of the most difficult policy challenges will be dealing with China, which has the ability
to affect a range of U.S. global, regional, and domestic interests. The U.S.-China relationship is
marked by a mix of cooperation and competition; the policy challenge is to maximize coop-
eration in areas where common interests exist, while competing successfully in areas where
U.S. and Chinese interests are opposed. Both countries have a strong interest in maintaining
an effective bilateral working relationship in order to pursue important global, regional, and
domestic goals. High-level leadership will be needed on both sides to keep the competitive and
cooperative aspects of the relationship in balance.42
Cooperation is important for the United States because China has become an important
global actor, with the ability to influence the effectiveness of global institutions such as the UN
Security Council and World Trade Organization. On some issues, such as climate change and
dealing with North Korea’s nuclear and missile ambitions, progress is impossible without co-
operation with China. While Chinese leaders view some aspects of global institutions as unfair
and are not interested in shoring up U.S. hegemony, they support a rules-based global economic
system and view the United Nations as the most legitimate institution of global governance.43
China has been one of the biggest beneficiaries of the open global trade system established by
the United States after World War II, which facilitated its economic rise. Beijing seeks to wield
greater influence within global institutions, and where possible to work with other countries to
adjust international rules and norms to better reflect its own interests and perspectives. Never-
theless, China remains reluctant to take on the costs, risks, and commitments necessary to play
a global leadership role; its actions are usually focused on defending narrow Chinese interests
rather than aspiring for global leadership. Given that China’s main interest in most parts of the
world is to maintain stability and secure access to resources and markets, its interests will often
be relatively compatible with those of the United States.44
U.S. and Chinese interests are less aligned at the regional level, where there is increasing
competition for influence. Over the last decade, Beijing has become more critical of the U.S. al-
liance system, arguing that it reflects Cold War thinking and emboldens U.S. allies to challenge
Chinese interests. The U.S. rebalance to the Asia-Pacific and increased U.S. regional security
cooperation have stoked Chinese fears of U.S. encirclement or containment. Beijing’s proposed
alternatives emphasize nontraditional security cooperation and the importance of resolving
disputes through peaceful dialogue. Beijing has resisted making any binding commitments that
might restrict its military capabilities or ability to employ military power to defend its core in-
28
terests. Its increasing military capabilities and more assertive approach to maritime territorial
disputes have heightened regional concerns about how a strong China will behave, leading most
countries to improve their security ties with the United States. If the United States emphasizes
its alliances, expanding security cooperation with other partners, and active engagement with
regional multilateral institutions, it will be able to deal with Chinese regional security initiatives
and actions from a position of strength and successfully resist Chinese efforts to erode the U.S.
alliance system. Conversely, if Washington appears disengaged, it will become less relevant and
less able to shape the evolving regional security environment.
Cooperation for regional influence will also have important military dimensions. Chi-
na’s investment in indigenous and Russian conventional submarines, warships armed with ad-
vanced anti-ship cruise missiles, improved aircraft, and a formidable array of increasingly accu-
rate ballistic missiles will make it more difficult and costly for the U.S. military to project power
near and into Chinese territory. Some Chinese systems, such as the DF-21D anti-ship ballistic
missile, are specifically designed to target U.S. aircraft carriers. The United States is responding
with innovative systems such as a new strategic bomber, technologies (under the Third Offset
strategy), and operational concepts (such as AirSea Battle, now labeled the Joint Concept for
Access and Maneuver in the Global Commons) that Chinese military analysts will regard as
highly threatening.
As the U.S. military increases its presence in the Asia-Pacific region and the People’s Lib-
eration Army extends its operations farther from the Chinese coast, the frequency of potentially
dangerous interactions between U.S. and Chinese military aircraft and vessels will increase.
Moreover, competition extends into space and cyber domains, which both militaries regard
as critical to their ability to fight and win wars. Military-to-military relations are unlikely to
overcome these competitive dynamics, but they can have considerable value in enhancing de-
terrence, increasing transparency, and dispelling unfounded suspicions. They can also develop
communication mechanisms and understandings about how military ships and aircraft will
behave when they encounter each other, which will help avoid incidents and provide more ef-
fective crisis management tools.
U.S. policymakers should be careful to resist Beijing’s efforts to create a U.S.-China condo-
minium or “G-2”-like arrangement. Such an arrangement would be unlikely to last and would
probably require unacceptable compromises to accommodate China’s so-called core interests
(including accepting China’s territorial claims to Taiwan and in the South China Sea and East
China Sea). Accepting a Chinese sphere of influence or giving the appearance of siding with
29
Beijing against U.S. allies would damage U.S. credibility and compromise the U.S. position in
the Asia-Pacific region.
The Trump administration will have the opportunity to develop a new label for the U.S.-
China relationship to replace Beijing’s preferred formulation of a “new type of major country
relationship.” It will be important to adopt a label that reflects the importance of the U.S.-China
relationship, but does not suggest that the United States values its relationship with China above
its relationships with its treaty allies.
China’s more assertive regional behavior is partly the product of misreading global power
trends (including the mistaken assessment that the 2008 global financial crisis marked a fun-
damental shift in the relative balance of power between the United States and China). Current
Chinese Communist Party efforts to tighten political control over the Chinese population and
restrict the flow of information into China reflect increasing concerns about domestic stability
in the face of slowing economic growth. China’s successful economic model needs to be adapted
to place more weight on markets and domestic demand, but there are widespread concerns that
the political system may not be able to push through the necessary reforms. Moreover, past ef-
forts to stimulate the economy in the wake of the financial crisis have created debt burdens at
various levels of the Chinese financial system that increase the risk of a major financial crisis.
Although an economic collapse that brings down the Chinese regime is unlikely, President
Trump will likely face a Chinese leadership more focused on maintaining domestic stability and
less inclined to engage in provocative international behavior. This will heighten the importance
of a cooperative working relationship with the United States to give China the space to deal with
its internal problems and should give U.S. policymakers more leverage. China will continue its
military modernization and regional infrastructure investments through the Asian Infrastruc-
ture Investment Bank and the One Belt, One Road, initiative but may have fewer resources
to devote to these efforts. Chinese leaders are unlikely to engage in provocative international
behavior to divert attention from domestic problems but will be concerned that other countries
may seek to exploit a distracted Chinese leadership.45 The result may be an increased interest in
stabilizing maritime territorial disputes and avoiding challenges to Chinese sovereignty claims.
This approach might also spill over into more interest in engaging with the Democratic Progres-
sive Party on Taiwan to work out an acceptable formulation for cross-strait relations.
Conclusion
Over the next 4 years, the United States will be challenged to maintain its leadership
of a rules-based order in the Asia-Pacific region. U.S. diplomacy must play a leading role in
30
strengthening our alliances, partnerships, and regional institutions that widely share the U.S.
commitment to a rules-based order as the foundation of regional peace and stability.
The U.S. bilateral alliances with Australia, Japan, the Philippines, the Republic of Korea,
and Thailand remain the foundation of our strategic presence in the Asia-Pacific region and
need appropriate high-level attention. At the same time, the alliance structure is evolving to-
ward a more open system, with new security partnerships forming across the region. This has
been most noticeable in Southeast Asia, where Australia, Japan, and the United States are all en-
gaged in maritime capacity-building with states bordering on the South China Sea. The United
States should expand bilateral and multilateral security cooperation with its allies and partners
and support their efforts to promote regional security cooperation. Given U.S.-China regional
competition, initiatives from other countries may sometimes be the best means of moving for-
ward.
The United States is best positioned to deal with China if it has devoted sufficient atten-
tion to its regional alliances, partnerships, and participation in multilateral organizations. The
President will need to engage directly with his Chinese counterpart in order to keep both gov-
ernments focused on a cooperative agenda and to manage the more competitive aspects of the
relationship. The relationship with Beijing will be challenging, but Chinese internal economic
and political problems are likely to give U.S. policymakers more leverage. Chinese leaders will
remain suspicious about U.S. intentions to contain China. U.S. policymakers should stress that
the United States supports open, rules-based regional and global organizations, which will re-
quire China’s active participation and support if they are to achieve their goals and, at the same
time, can help generate international pressure on China to be a constructive participant.
Consistent engagement with the region by the highest levels of U.S. leadership will be
critical for success. Allies, partners, and potential challengers will judge the regular presence
of the President, Secretary of State, and Secretary of Defense in the region as a key indicator of
U.S. commitment. Sustained U.S. involvement and close coordination with regional allies and
partners will allow the Trump administration not only to meet the challenges in the Asia-Pacific
region, but also to grasp the opportunities.
31
Notes
1
The Southeast Asia Treaty Organization (SEATO), a multilateral treaty established in 1954 to
resist the expansion of communism in Southeast Asia, is a partial exception. SEATO was dissolved in
1977.
2
The Association of Southeast Asian Nations (ASEAN) is made up of Brunei Darussalam,
Cambodia, Indonesia, Laos, Malaysia, Myanmar (Burma), the Philippines, Singapore, Thailand, and
Vietnam.
3
The World Bank, “East Asia Pacific Economic Update, October 2015: Staying the Course,”
available at <www.worldbank.org/en/region/eap/publication/east-asia-pacific-economic-update>.
4
U.S. Census Bureau, “Trade in Goods with Asia,” available at <www.census.gov/foreign-trade/
balance/c0016.html>.
5
U.S. Census Bureau, “U.S. Direct Investment Abroad for 2012–2014,” September 2015, avail-
able at <http://bea.gov/scb/pdf/2015/09%20September/0915_outward_direct_investment_detailed_his-
torical_cost_positions.pdf>.
6
East-West Center, “Asia Matters for America,” available at <http://www.asiamattersforamerica.
org/overview>. Note that the Asia Matters for America project includes 40 countries as comprising the
Asia-Pacific region.
7
Walter Lohman, Olivia Enos, and John Fleming, 2014 Asia Update: What’s at Stake for Amer-
ica, Special Report No. 158 (Washington, DC: The Heritage Foundation, October 8, 2014), available at
<www.heritage.org/research/reports/2014/10/asia-update-whats-at-stake-for-america-2014>.
8
China’s official growth statistics for 1998 and 2008 do not fully reflect this slowdown, which
was partly offset by large economic stimulus packages.
9
Bonnie S. Glaser, “China’s Coercive Economic Diplomacy—A New and Worrying Trend,”
PacNet 46 (Honolulu, HI: Center for Strategic and International Studies, July 23, 2012).
10
Christopher Bodeen, “China’s Military Spending Increase to Be Smallest in 6 Years,” Associ-
ated Press, March 4, 2016.
11
State Council Information Office, “China’s Military Strategy,” May 2015, available at <http://
eng.mod.gov.cn/Database/WhitePapers/>.
12
See Annual Report to Congress: Military and Security Developments Involving the People’s
Republic of China 2015 (Washington, DC: Department of Defense, 2015).
13
David Shambaugh, ed., Power Shift: China and Asia’s New Dynamics (Berkeley: University of
California Press, 2006); Evelyn Goh and Sheldon W. Simon, eds., China, the United States, and Southeast
Asia: Contending Perspectives on Politics, Security, and Economics (New York: Routledge, 2008).
14
See David Shambaugh, China Goes Global: The Partial Power (New York: Oxford University
Press, 2013); Phillip C. Saunders, “China’s Role in Asia: Attractive or Assertive?” in International Rela-
tions of Asia, ed. David Shambaugh and Michael Yahuda, 2nd ed. (Lanham, MD: Rowman and Littlefield,
2014), 147‒172.
15
“Remarks by President Obama to the Australian Parliament,” Canberra, Australia, November
17, 2011, available at <www.whitehouse.gov/the-press-office/2011/11/17/remarks-president-obama-
australian-parliament>.
32
16
Hillary Clinton, “America’s Pacific Century,” Foreign Policy 189 (November–December 2011),
56–63.
17
For an analysis of the origins of the rebalance, see Phillip C. Saunders, “China’s Rising Power,
the U.S. Rebalance to Asia, and Implications for U.S.-China Relations,” Issues and Studies 50, no. 3 (Sep-
tember 2014), 19–55.
18
See the fact sheets from the U.S. Trade Representative’s Office, available at <http://www.ustr.
gov/tpp>; Jeffrey Schott, Barbara Kotschwar, and Julia Muir, Understanding the Trans-Pacific Partnership
(Washington, DC: Peterson Institute for International Economics, 2013).
19
Ashton Carter, “Remarks on the Next Phase of the U.S. Rebalance to the Asia-Pacific,” Mc-
Cain Institute, Arizona State University, Tempe, AZ, April 6, 2015, available at <www.defense.gov/
News/Speeches/Speech-View/Article/606660>.
20
For a recent overview of these activities, see Admiral Harry B. Harris, Jr., commander, U.S.
Pacific Command, statement before the Senate Armed Services Committee hearing on U.S. Pacific
Command Posture, February 23, 2016, available at <www.armed-services.senate.gov/imo/media/doc/
Harris_02-23-16.pdf>.
21
For the Japanese position, see Ministry of Foreign Affairs of Japan, “Fact Sheet on the
Senkaku Islands,” November 2012, available at <http://www.mofa.go.jp/region/asia-paci/senkaku/
fact_sheet.html>; for the Chinese position see State Council Information Office, “Diaoyu Dao, an Inher-
ent Territory of China,” September 2012, available at <http://news.xinhuanet.com/english/china/2012-
09/25/c_131872152.htm>
22
Japan Ministry of Defense, available at <www.mod.go.jp/e/publ/w_paper/pdf/2014/
DOJ2014_3-1-1web_1031.pdf>.
23
National Security Strategy (Tokyo: Ministry of Defense, December 17, 2013), 1, available at
<www.cas.go.jp/jp/siryou/131217anzenhoshou/nss-e.pdf>.
24
See Annual Report to Congress: Military and Security Developments Involving the Democratic
People’s Republic of Korea 2015 (Washington, DC: Department of Defense, 2015).
25
For an analysis of future scenarios, see Phillip C. Saunders, James J. Przystup, and David F.
Helvey, “North Korea 2025: Alternate Futures and Policy Challenges,” CSCMA Event Report, February
2, 2016, available at < http://inss.ndu.edu/Portals/82/Documents/conference-reports/2015-Korea-Sym-
posium-Event-Report.pdf>.
26
Alan D. Romberg, “The ‘1992 Consensus’—Adapting to the Future?” China Leadership Moni-
tor, no. 49 (Winter 2016), available at <www.hoover.org/sites/default/files/clm49ar.pdf>.
27
In late December 2016, Sao Tome and Principe shifted diplomatic recognition from Taiwan
to the People’s Republic of China. See “China Resumes Ties with Sao Tome, Which Turned Away from
Taiwan,” Associated Press, December 26, 2016.
28
Mark Landler and Michael Forsythe, “Trump Tells Xi Jinping U.S. Will Honor ‘One China’
Policy,” New York Times, February 9, 2017.
29
ASEAN, “Declaration on the Conduct of Parties in the South China Sea,” November 4, 2002,
available at <www.asean.org/?static_post=declaration-on-the-conduct-of-parties-in-the-south-china-sea>.
30
See Christopher D. Yung and Patrick McNulty, An Empirical Analysis of Claimant Tactics in
the South China Sea, INSS Strategic Forum 289 (Washington, DC NDU Press, August 2015).
33
31
Ibid.
32
Asia-Pacific Maritime Security Strategy (Washington, DC: Department of Defense, August
21, 2015), available at <www.defense.gov/Portals/1/Documents/pubs/NDAA%20A-P_Maritime_Secu-
ritY_Strategy-08142015-1300-FINALFORMAT.PDF>.
33
Ibid.
34
“Foreign Ministry Spokesperson Lu Kang’s Regular Press Conference on October 27, 2015,”
Ministry of Foreign Affairs of the People’s Republic of China, October 27, 2015, available at <www.
fmprc.gov.cn/mfa_eng/xwfw_665399/s2510_665401/t1309625.shtml>.
35
Asia-Pacific Maritime Security Strategy.
36
In Japan, North Korea’s growing missile arsenal raises similar questions regarding missile
defense and deterrence.
37
Brad Roberts, Extended Deterrence and Strategic Stability in Northeast Asia, NIDS Visiting
Scholar Paper Series, No. 1 (Tokyo: National Institute for Defense Studies, August 9, 2013 ), available at
<www.nids.go.jp/english/publicationvisiting/pdf.01.pdf>.
38
Chang Se-jeong and Ser Myo-ja, “Xi Pressed Park on Thaad System,” Korea JoongAng
Daily, February 6, 2015, available at <http://koreajoongangdaily.joins.com/news/article/article.
aspx?aid=3000595>.
39
Available at <www.gov.ph/2014/04/29/document-enhanced-defense-cooperation-agree-
ment>.
40
“Resourcing the Pivot to East Asia and the Pacific FY 2015 Budget Priorities,” May 20, 2014,
House of Representatives Subcommittee on Asian and Pacific Affairs, Committee on Foreign Affairs, 4.
41
“Fact Sheet: U.S. Building Maritime Capacity in Southeast Asia,” available at <www.white-
houuse.gov/the-press-office/2015/11/17>.
42
See Phillip C. Saunders, Managing Strategic Competition with China, INSS Strategic Forum
242 (Washington, DC: NDU Press, July 2009).
43
Thomas Fingar, “China’s Vision of World Order,” in Strategic Asia 2012–2013: China’s Military
Challenge, ed. Ashley J. Tellis and Travis Tanner (Washington, DC: National Bureau of Asian Research,
2012), 342‒373.
44
Phillip C. Saunders, “Implications: China in the International System,” in The Chinese People’s
Liberation Army in 2025, ed. Roy Kamphausen and David Lai (Carlisle Barracks, PA: Strategic Studies
Institute, 2015), 301‒333.
45
John Speed Meyers and Phillip C. Saunders, “Will China Start a Diversionary War?” unpub-
lished manuscript, April 2015.
34
About the Authors
Dr. James J. Przystup has worked on Asia-related issues for over 30 years: on the staff of
the United States House of Representatives Subcommittee on Asian and Pacific Affairs; in the
private sector with Itochu Corporation and IBM World Trade Americas/Far East Corporation;
in the United States Government, on the State Department’s Policy Planning Staff under Secre-
tary of State George P. Shultz and Under Secretary of State James A. Baker III, as Senior Member
responsible for East Asia and the Pacific; and in the Office of the Under Secretary of Defense
for Policy, as Director for Regional Security Strategies on the Policy Planning Staff. During the
administration of President Ronald Reagan, Dr. Przystup served as the Deputy Director of the
Presidential Advisory Commission on U.S.-Japan Relations. He also served on the State De-
partment delegation to the Paris Peace Conference on Cambodia. Before accepting his current
position, he was Director of the Asian Studies Center at the Heritage Foundation. Dr. Przystup
was presented with the State Department’s Meritorious Honor award in 1989 and 1991; the
Defense Department’s Outstanding Achievement Award in 1992; and cited for his Exceptional
Performance by the National Defense University on three separate occasions.
Dr. Przystup graduated summa cum laude from the University of Detroit and holds an M.A.
in International Relations from the University of Chicago and a Ph.D. in Diplomatic History also
from the University of Chicago. He studied Japanese at Columbia University and Keio University
in Tokyo and was a Visiting Fellow on the Law Faculty of Keio University.
Dr. Phillip C. Saunders is Director of the Center for the Study of Chinese Military Affairs
and a Distinguished Research Fellow, Institute for National Strategic Studies, at the National
Defense University. Dr. Saunders previously worked at the Monterey Institute of International
Studies, where he was Director of the East Asia Nonproliferation Program from 1999–2003, and
served as an officer in the U.S. Air Force from 1989–1994. Dr. Saunders is co-author, with David
Gompert, of The Paradox of Power: Sino-American Strategic Restraint in an Era of Vulnerability
(NDU Press, 2011) and co-editor of five books on Chinese military and security issues. Dr.
Saunders attended Harvard College and received his MPA and Ph.D. in International Relations
from the Woodrow Wilson School at Princeton University.
35
Center for Strategic Research Senior Fellows
COL KRIS A. BAUMAN, USAF, PH.D.

Senior Military Fellow
COL SUSAN BRYANT, USA, PH.D.

Senior Military Fellow
DR. G. ALEXANDER CROWTHER

Senior Research Fellow
DR. T.X. HAMMES

Distinguished Research Fellow
DR. FRANK G. HOFFMAN

DR. CHRISTOPHER J. LAMB

DR. ANDRE LE SAGE

DR. THOMAS F. LYNCH III

DR. DENISE NATALI

Director
DR. JAMES J. PRZYSTUP

DR. PHILLIP C. SAUNDERS

BRIGADIER GENERAL PETER B. ZWACK, USA (RET.)

For a complete list of INSS researchers and staff, please visit inss.ndu.edu.
I S B N 978-0-16-093962-4
90000
9 780160 939624

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STRATEGIC PERSPECTIVES 26

Asia and the Trump Administration:

Center for Strategic Research

The Institute for National Strategic Studies (INSS) is National

By James J. Przystup and Phillip C. Saunders

Institute for National Strategic Studies

Series Editor: Denise Natali

National Defense University Press

First printing, June 2017

U.S. National Interests in the Asia-Pacific Region.......................................... 6

Defining Trends in the Asia-Pacific Region..................................................... 7

Asia-Pacific Security Challenges..................................................................... 12

Sustaining U.S. Presence................................................................................... 20

About the Authors............................................................................................. 35

The Asia-Pacific region is of exponentially increasing importance to the United States.

■■ encourage increased cooperation among U.S. allies

■■ U.S. policymakers should resist Beijing’s efforts to create a U.S.-China condominium

U.S. National Interests in the Asia-Pacific Region

■■ defense of the homeland, U.S. territories, and U.S. citizens

■■ strengthening U.S. alliance relationships and reinforcing U.S. commitment to security

■■ prevention of the proliferation of weapons of mass destruction and missile delivery

Defining Trends in the Asia-Pacific Region

Asia’s Economic Dynamism

The Rise of China

The U.S. Rebalance to Asia

Asia-Pacific Security Challenges

South China Sea

Sustaining U.S. Presence

Moving Beyond the Hub-and-Spokes Alliance System

Shaping the Asia-Pacific Order

The Trans-Pacific Partnership and U.S. Trade with Asia

China Policy: Managing a Mixed Relationship

About the Authors

COL KRIS A. BAUMAN, USAF, PH.D.

COL SUSAN BRYANT, USA, PH.D.

DR. G. ALEXANDER CROWTHER

DR. T.X. HAMMES

DR. FRANK G. HOFFMAN

DR. CHRISTOPHER J. LAMB

DR. ANDRE LE SAGE

DR. THOMAS F. LYNCH III

DR. DENISE NATALI

DR. JAMES J. PRZYSTUP

DR. PHILLIP C. SAUNDERS

BRIGADIER GENERAL PETER B. ZWACK, USA (RET.)

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