Trade, Interdependence, and Security in Asia

EXECUTIVE SUMMARY

This overview explores how growing levels of trade and interdependence fit into the grand strategies of Asian states and how changing economic relationships could affect regional stability.

MAIN ARGUMENT

Trade is a critical instrument in Asia’s economic growth. China’s explosive growth during the last three decades, in particular, has created a web of interdependence conducive to rapid growth, linking both friends and rivals. Even India and Russia, which previously had not emphasized foreign trade, now have focused on increasing links with the global economy.

POLICY IMPLICATIONS

• Complex and variegated growing trade dependence in Asia offers no assurance that interdependence will make violent conflict between states irrelevant.
• Asian states appear to view trading relations as vehicles to increase national wealth rather than as a means for procurement of collective security. These states have yet, however, to exhibit acute fears about their partners’ relative gains from such relationships.
• This nonchalance may derive from three judgments relevant to the future of Asia: (1) The primacy of the United States is robust enough to ensure that differentials in relative gains are strategically insignificant; (2) Asian states expect regional peace to continue, thereby strengthening positive expectations for future trade; and (3) even if gains are diverted to military purposes in some states (such as China), these states do not yet pose consequential military threats and could potentially be contained without forgoing profitable trading relationships.
• Since Asian leaders appear content to straddle the divide on interdependence versus security, Asian countries will continue to enjoy gains from international commerce so long as these two goals are not perceived to be in absolute conflict.