(EnergyAsia, September 24 2012, Monday) — The following is an edited version of the keynote address delivered by Kevin Rudd, a former Prime Minister of Australia, at last Friday’s Singapore Global Dialogue.

The core objective of the Asian hemisphere in the first half of the 21st century is to avoid instability, conflict or war between China and the US while preserving and enhancing the integrity of the current regional and global rules-based order.

In the history of international relations, the alternative to order is anarchy.

We must preserve the peace because of the extraordinary human cost of war, but equally because strategic stability has been essential for the spectacular economic growth and significant rise in prosperity in our region over the last half century.

We now owe it to the world at large. What happens in Asia matters to the US, Europe, Africa and Latin America. Our region is no longer on the margins of the global growth equation. We have become its central organising principle.

If Asian security and prosperity falters, so too will the world’s.

As Kishore Mahbubani recently reminded us, we are returning to a time when the principal economies of the world are Asian given this has been the case for 1800 of the last 2,000 years.

What is occurring is more profound than a technical shift in the centre of strategic gravity from the Atlantic to the Pacific, from the West to the East. There are civilisational dimensions to this transformation as well.

The responsibilities that rest on the shoulders of this generation of Asian leaders are great. They will demonstrate that they’ve either learnt the lessons of the bloody history of modern Europe, or will simply repeat them.

Many would find it extraordinary that we could be having a conversation about the possibility of future conflict in Asia. Surely, given globalisation’s extraordinary benefits to Asia, the prospects of inter-state based conflict in the 21st century is unthinkable.

Regrettably, that is what the nations of Europe said to one another a hundred years ago in the decade leading up to Sarajevo, when economic globalisation was even more comprehensive than is the case today.

Economics does not solve politics. Politics still matters.

In Asia, we live in the vortex of two formidable yet fundamentally conflicting forces: economic globalisation and political nationalism.

The forces of globalisation draws us closer together through our economies, trade, investment and the technologies that now radically reduce the time and space of economic and social transactions.

At the same time, we have the forces of ethno-centric nationalism, invariably driven by a toxic combination of competing territorial claims and long-standing cultural animosities. Will the globalists or the nationalists win the race?

And the core point is this: the mindset that we bring to these challenges.

Mindsets matter.

The security challenges we face can be managed or even overcome by creatively applying the positive principles of common security.

Or is this idealism doomed to failure while the real-politic proceeds in fear that our neighbours are probably planning for the next crisis, conflict or even war.

Australia sees itself as a middle power with both regional and global interests, animated by universal values of open politics, open economies and open societies. We are optimistic about our country’s and the region’s future.

We have seen how far our region has come over the last half century after Asia emerged from the ashes of the Second World War. We have it within our collective wit and wisdom to craft a common future for us all, China and America included.

Australians feel relaxed and comfortable with our region just as we believe the region is increasingly relaxed and comfortable with Australia. We recognise and respect the region’s deep diversity.

Just as we recognise and respect the fact that much of the region suffered for centuries under European colonial rule. We have strong bilateral relationships with practically every country in the region, deep economic engagement, large-scale development assistance relationships and rapidly expanding people-to-people contact.

We are also founding members of most of Asia’s principal regional institutions. We have an active regional and global diplomatic network in seeking to be as constructive, innovative and as forward-leaning as possible in dealing with some of the region’s great challenges.

It is with this mindset that we in Australia have approached the challenge of how best to preserve the peace, security and therefore prosperity of Asia.

Across our region is a series of flashpoints each capable of triggering one form of conflict or another.

Historically we have been preoccupied with the big three: the Korean Peninsula, the Taiwan Straits and India-Pakistan and the question of Kashmir.

In Korea we wait to see what unfolds with the new leadership, but remain deeply concerned about North Korea’s continued nuclear weapons programme.

Across the Taiwan Straits, these are the best of times since 1949 due to sound policies in Taipei and Beijing, but always capable of political crisis and policy reversal.

With India and Pakistan, the world lives in continuing anxiety as to the consequences of any future Islamist terrorist attacks on the sub-continent.

All three involve nuclear weapons states and in some cases, states with highly uncertain nuclear doctrines.

Apart from Iran’s nuclear weapons programme, we are also seeing new instabilities arising from what was long regarded as the region’s lesser disputes – namely the conflicting territorial claims of a number of regional states to various islands and surrounding seas in the South China Sea, the East China Sea and the Sea of Japan.

These disputes are now more volatile in more than a quarter of a century, with the concentration of naval, air and other maritime assets increasing and the attendant nationalisms in many countries fuelling the fire.

So how then should the region proceed? Not just China, Japan, Korea, Vietnam, the Philippines, Indonesia, Malaysia or Brunei.

The South and East China Sea

If we include Taiwan, there are six separate claimant states over the Nansha (Spratlys), the Xisha (the Paracels) the Zhongsha (Macclesfield) and the Dongsha (Pratas) and their surrounding seas and sub-sea resources.

The map of these conflicting claims makes the early 20th century maps of the Balkans look simple by comparison.

The overlapping claims are most intense between China, Vietnam and the Philippines, resulting in incidents and conflicts over the decades, most recently between China and Vietnam in 1972 and 1988.

The US government has declared that it is neutral on conflicting territorial disputes on the South China Sea, but it has an overriding interest in maintaining freedom of navigation as a generic principle of international maritime law underlined by the significance of these seas to global maritime trade.

In the East China Sea, the dispute between China and Japan over Diaoyudao / Senkaku goes back to the late Qing Dynasty when the Japanese government annexed these islands from the Chinese after the Sino-Japanese war of 1895.

After World War Two, the islands came under US control and were returned to Japan with the Okinawa Reversion Agreement of 1971. In the last 15 years, Japanese and Chinese activists have been undertaking nationalist campaigns through landings and incidents at sea.

Unlike in the South China Sea, the US recognises Japanese sovereignty over these islands and has stated publicly that they are covered by the terms of the Japan-US Defence Treaty of 1951.

Separately, Japan and Korea have been making competing for islands in the Sea of Japan.

These disputes exhibit a volatile combination of populist nationalism, historical animosities exacerbated by domestic political transition, oil and gas resources, and, most acutely, competition for scarce fisheries in a protein-deficient region.

The large-scale presence of state-owned and registered fishing vessels, coastal surveillance vessels and naval ships has raised the risk of incidents at sea.

There’s also growing risk of incidents given the large number of government agencies involved from various countries.

In the most recent series at the Scarborough Shoal, one report cited more than 100 vessels of different types in highly constrained waters. The number and intensity of incidents arising from these disputes is unprecedented.

What regional diplomatic efforts exist to deal with these challenges?

In the South China Sea, China agreed upon a so called Declaration of Conduct (DoC) in 2002. In 2011 agreement was reached on the DoC guidelines that are broad civil commitments to resolve disputes peacefully.

The substantive diplomacy has been directed towards drafting a comprehensive Code of Conduct to provide a regional diplomatic mechanism to resolve disputes.

In July this year, ASEAN foreign ministers adopted the key elements of the draft Code of Conduct for negotiation with China. The draft offers mediation and conciliation services by the ministerial-level ASEAN High Council.

If that fails, a second mechanism is offered whereby the disputants may “resort to dispute settlement mechanism provided under international law, including UNCLOS”.

China has indicated that it is willing to begin a dialogue on the code prior to the Foreign Ministers ASEAN Summit.

The most spectacular outcome on the recent ASEAN Foreign Ministers Meeting in July was its failure, for the first time in 40 years, to produce an agreed communique. This was due to ASEAN’s inability to achieve consensus on a reference in the communique to Vietnamese and Philippines concerns about recent incidents in the South China Sea.

In turn, this has thrown the spotlight on ASEAN’s future cohesion in dealing with the most sensitive security policy challenges on its agenda.

Finally, on the Diaoyudao / Senkaku dispute, there are no regional diplomatic mechanisms to be drawn on at all in what has become an exclusively bilateral dispute. This has triggered the worst anti-Japanese protests in China, the worst since Sino-Japanese diplomatic normalisation 40 years ago.

Our region hopes common sense will prevail in the management of all these disputes. But as someone who has watched this region closely over 35 years, I have begun to become concerned about the trajectory we are on.

None of the leaders of the region whom I have met over the last five years have the slightest interest in intentionally seeing any of these disputes degenerate into armed conflict. The stakes are high, and we urge restraint and reason on behalf of all parties to these disputes.

The Principles of a new Pax Pacifica

All this is occurring in the context of a wider region in the midst of profound geostrategic and economic change.

China became Asia’s largest economy in 2010, and could become the world’s largest economy by 2010. China’s military modernisation is profound including rapid increases in its defence expenditure and its acquisition of force projection capabilities.

Since the Asian Financial Crisis 15 years ago, China’s foreign policy has also become more assertive in pursuit of its national interests.

The US has declared that it will remain a Pacific power, maintaining it naval presence by committing 60% of its global naval forces to the region. Diplomatically, the US has also radically re-engaged the region under Secretary of State Clinton, who has spent more time in Asia than any of her predecessors in US history.

For the first time, the US has become multilaterally engaged in Asia’s security policy deliberations. While the US had been a long-standing member of the ASEAN Regional Forum, it is generally accepted that the ARF is limited in scope.

That has changed, however, in the last two years. In 2010 the US became a member of the ASEAN Defence Ministers +8 (ADMM +8), and in 2011 a full member of the East Asia Summit.

It is critical to remind the Americans, the Chinese and the rest of the world, that the region’s future will not be exclusively shaped by Washington and Beijing.

The rest of the region have profound interests at stake as well. We have significant diplomatic and strategic assets to deploy in pursuit of our combined interests and values.

Nonetheless, my overall point remains that the overall strategic environment of our Asian hemisphere remains brittle.

In the absence of effective pan-regional institutions with a political and security mandate and with norms and procedures underpinning a predictable regional security order, there is little regional buffer to soften the blow, or regional ballast to steady the ship, when individual security incidents arise like those we now see in the South China Sea and the East China Sea.

In 2008, Australia launched its vision for an Asia-Pacific community which caused considerable controversy in Asia, particularly in ASEAN and Singapore.

We did this because our region did not possess a single institution of sufficiently broad membership and mandate to embrace the range of political, security and economic challenges facing the region.

The ARF was too broad and its membership did not meet at summit level. APEC, while a clear cut economic success, had no political or security mandate and from the outset excluded India.

The East Asia Summit (EAS), formed in 2005, possessed the right mandate but excluded the US. We therefore had to build a new institution or change the mandate of an existing institution.

We worked closely with ASEAN to ensure that the US and Russia were invited to join the EAS. We then worked closely with the US to make sure they accepted the invitation. Today, the US and Russia are full members.

Australia regards this as the development of the Asia Pacific community by another name. It is a long-term project to fashion the concept and the reality of common security and an open regional economy.

For this vision to become a reality, ASEAN must remain at the core of the East Asia Summit, not just because ASEAN has interests at stake or that it carries significant political, economic and strategic weight.

Despite recent challenges, ASEAN is Asia’s single most successful regional institution. Over 45 years, enemies have been turned in to friends; competitors into partners, and internal conflict has largely been avoided.

Given Southeast Asia’s ideological and cultural diversity, these are remarkable achievements and a testament to ASEAN regional diplomacy.

These are the reasons why the rest of Asia needs ASEAN to be the vibrant core of the East Asia Summit, the East Asian community and the Asia Pacific community.

As the next step, we need to use this new platform of an expanded East Asia Summit to create a regional rules-based order for Asia that will change the mindset of our region from conflict, to incident management, to strategic cooperation.

We need to learn the lessons of Europe within a condensed timeframe, and without mindlessly repeating Europe’s mistakes over the centuries.

Early this year, in an address to the Asia Society in New York as Australia’s Foreign Minister, I outlined a concept of what I described then as a new Pax Pacifica. It is distinct from a Pax Americana, and also from any concept of a Pax Sinica.

For a Pax Pacifica, we will consciously build the habits, customs and norms of security and strategic cooperation from the ground up.

As I said back then, this concept does not ignore the underlying strategic realities of the region – the rise of China, continuing military and diplomatic engagement of the US the region’s future. Rather it accepts these realities.

But it also seeks to create new possibilities based these realities.

Remember in the darkest days of the Cold War, the Americans, the Soviets and the Europeans managed to conclude the Helsinki Accords.

They developed a Conference on Security Cooperation in Europe, they began to build basic confidence and security building measures to reduce the risk of unintended or accidental conflict.

In Asia, we have embraced very few confidence and security building measures of any description. That is in part why our security policy environment is so brittle.

Here are what could be the principles of a new Pax Pacifica:

First, it must be anchored in conceptual approaches which China, the US and the rest bring to the future shape of the region.

The Chinese encapsulate their foreign policy vision as one of “a harmonious world” (hexie shijie). Harmony is a profound concept in Chinese philosophy. It contains within it the concept of the balance of contending forces, the concept of finding the Golden Mean (Zhong Yong). It also contains within it classical Chinese virtues or what we would describe as values, or daode.

There is considerable exploratory work under Professor Yan Xuetong at Tsinghua University on how this might be articulated into the debate on the future of the regional and global order in his book “Ancient Chinese Thought, Modern Chinese Power”.

For a non-Chinese audience this may seem entirely academic and abstract.

But in China’s political tradition, philosophy matters. Concepts matter.

Not just for reasons of historical continuity. But also for the practical reason that with a Communist Party of 86 million members, policy directions have to be explained in concepts which are also comprehensible within Chinese political elites.

The creative challenge lies in how such concepts (and the language associated with those concepts) is translated and interpolated into non-Chinese conceptual frameworks, which are in turn comprehensible to the rest of us.

For example, for any international relations scholars, the paradigm debates within the international relations discipline in the West (realism, neo-realism, liberalism, neo-liberalism, idealism, structuralism, post-structuralism, communitarianism) are by and large alien to China’s domestic debate.

While there are obvious commonalities (for example the ‘Art of War’ by Xun Zi on the one hand, and Machiavelli on the other) closer analysis also reveals deep differences between traditional Chinese and Western statecraft, including diplomacy.

On the question, however, of a “harmonious world”, China’s current foreign policy mantra, there is a clear conceptual overlap with the idea of a multilateral rules-based order.

Multilateralism seeks to harmonise conflicting positions, and seeks to find a middle way.

Multilateralism is also potentially capable of incorporating values that may be universal in nature, but values which may go by different names in different cultures.

Therefore at a conceptual level, one practical recommendation I would make is that important intuitions such as RSIS and their counterparts in China, Australia and elsewhere in Asia, should embrace a common research project on producing a conceptual framework on a multilateral rules-based order for East Asia that draws on a range of philosophical traditions.

In China as elsewhere in Asia, this would be a mark of respect. It would not constitute the abandonment of core principles. Rather it would avoid the risk of these core principles simply being lost in cultural or even linguistic translation.

Such a concept paper might be presented to officials and ministers in the lead-up to the 2013 East Asia Summit.

A second area of concrete work to embrace this new Pax Pacifica concept is to be clear about some basic principles.

One, China’s peaceful rise should be accommodated by the US and the region, and that China has legitimate national security interests.

Two, China must accept US’s continuing strategic presence in the region as normal and that US alliances are to be respected.

Three, China and the US must accept that the region’s other member states also have major stakes in its future, and hence an equitable voice in the region’s management.

Four, all states should collectively develop, agree and accept the basic norms of behaviour for our regional rules-based order.

Five, this should include the non-use of force in dispute resolution.

Six, region-wide dispute resolution mechanisms along the lines outlined in the TAC and the ASEAN Code of Conduct.

Seven, the freezing of all existing interstate territorial claims, and the development of protocols for joint development commissions for the common extraction of resources from disputed territories.

Furthermore, the EAS and the ADMM +8 should enhance a programme of practical action to create a set of confidence building measures to enhance regional security cooperation:

First, hotlines between the relevant national security agencies within all member states to deal with incident management. RSIS has already done valuable work on this subject;

Second, detailed protocols for managing incidents at sea;

Third, regular high-level meetings between all the region’s militaries so that networks and relationships are developed over time;

Fourth, joint exercises in search and rescue and counter disaster, counter-terrorism and counter-organised crime;

Fifth, in time, transparency of military budgets and national military exercises.

The basic reality is that our armed forces are trained to fight and win wars. If at the same time we have a number of them engaged in a complex network of confidence and security building measures, including joint exercises and joint operations in counter-disaster, they will have a remarkable impact on our collective security policy mindset over time.

For example, for most Asians consider natural disasters as the number one physical security threat facing them today. Why not respond to their stated needs, consistent with the Australian and Indonesian paper agreed to at the last EAS Summit – and turn this vision into a reality.

A fourth and final practical recommendation in developing a Pax Pacifica (or what perhaps might one day be called the Organisation for Security Cooperation in Asia – OSCA) is it must be inclusive of both the EAS and the ADMM +8, both of which have an identical membership, the former with heads of government and foreign ministers, the latter with defence ministers.

On one level, an EAS at Summit level can help agree on the broad directions for security policy cooperation.

At a different, practical level, the ADMM +8 could be given specific responsibility to develop the raft of Confidence and Security Building Measures referred to above.

Fifth and finally, the EAS over time will need a dedicated secretariat. For various reasons, the analogy with Brussels does not work. The EAS is not an alliance nor an economic union.

But Brussels as an institution (both NATO and the EU) has had a remarkable and positive impact over the decades in taming the passions of rabid nationalism in Europe.

In time, ASEAN should give consideration to the hosting of an expanded EAS secretariat function.

None of the above will happen by magic, or by permanently rotating chairs. We will need to start to think together as a region – as we shape together the region’s future.


I remain an optimist about Asia’s future. As a practitioner, I am conscious of all the complexities and difficulties associated with the proposals that I have put forward to craft this Pax Pacifica.

But I am equally determined that our region should not simply drift into conflict by default. I have never accepted the proposition that human conflict is inevitable.

I do not accept the position that conflict between China and the US is inevitable.

Nor do I accept the banal position that somehow the region must “choose” between China and the US.

Hillary Clinton said recently there is enough room in the Pacific for both the US and China. Hillary is right.

I would add there is also plenty of room for the rest of us with our individual and collective voices as well.

Together with creative diplomacy and active statesmanship, despite all the complexity, we can craft together an Asian hemisphere grounded in the principles of the common security of us all.