The regional institutions of East Asia are often regarded as being relatively soft in character. Unlike those associated with the Western variety, they are not based on legally binding rules and procedures. They operate by consensus and such resolutions as they may produce are not binding on member states. These institutions are designed to enhance statehood and sovereignty, unlike say the African Union, which regularly sends troops into the countries of fellow members to uproot terrorism as in Somalia, or to help overcome violence against civilians as in Sudan, let alone the EU, whose member states “pool sovereignty.” Instead the East Asian regional organizations operate on the principle of non-interference in each other’s domestic affairs. Many of them are based on, or linked to, ASEAN (the Association of Southeast Asian Nations) founded in 1967 – the only multilateral regional organization from the Cold War period to survive. Such economic integration as has taken place in the region owes little to formal multilateral intergovernmental organizations. Rather it has been driven by businesses of various kinds that have built up across border chains of production and other economic linkages. It is the relative looseness of these regional institutions that has made them attractive

to both China and Japan. Neither has been willing to alter what each has regarded as the fundamentals of its domestic system to meet the demands of other states. China in particular has resisted external pressure, which its leaders sense might threaten Communist Party rule. Japan with its neo-mercantilist economy has also been resistant to external pressure to change some of its key features. However, the approaches of China and Japan towards regional institutions have been quite different. As a relatively isolated country that was still constrained diplomatically in the region because of the legacy of its aggressive wars, Japan sought to embed itself in East Asia through soft regional institutions and enhance its economic and political influence. China, on the other hand, valued membership of regional institutions as they provided a means to assuage fears of China’s rise, to promote regional stability and expand Chinese influence. It was not until the latter half of the 1990s that it became apparent that China and

Japan became rivals as well as partners in these regional organizations and in the region as a whole. Until then Japan was able to pursue an informal leading role as the so-called head of a flock of flying geese. But after the bursting of its economic bubble in 1991 and its failure to recover, the luster of its economic model was lost. As Japan turned more inward it lost much of the vitality it had hitherto displayed in Southeast Asia in particular. Ironically it was just at this time that China began its new policy of cultivating its neighbors, especially those in Southeast Asia. In comparison with an apparently stagnant Japan, China was visibly the major country on the rise. It was this sense of a rising China

and a stagnating Japan that set the stage for an emerging rivalry between the two even though they were also partners in many respects. They became competitors for influence and status as each sought to use its largely

economic assets to gain advantage. However, each of the two great regional powers carried a mixed baggage of assets and liabilities in their dealings with the region. In addition to the long shadow cast by China’s past imperial attempts to impose its superiority over the region’s centers of authority, contemporary China had encouraged subversion during the Maoist period and it had territorial and maritime disputes with several counties in Southeast Asia. China had also resorted to the use of force several times in support of its claims. The ethnic Chinese resident in Southeast Asia has been both an asset and a liability. On the positive side, they have been China’s principal economic interlocutors in the region as well as the providers of needed investment. Against that they have sometimes been seen as less than fully loyal to their countries of residence and in that sense they have sometimes been liabilities for the Chinese mainland, which has then faced the dilemma of either supporting fellow ethnic Chinese and risking good relations with the relevant Southeast Asian state, or of favoring relations with the state and thereby risking the wrath of nationalists back home. China’s main assets were its growing significance as the dynamic economic hub for the

region and its rising power. As the major regional power China was able to ensure that no Southeast Asian state challenged its position on Taiwan or on other key interests that did not involve regional states directly. China was also able to take advantage of the desire of ASEAN states to engage with it and to socialize it into accepting regional norms of cooperation and conflict avoidance. The regional engagement of China also had the effect of imposing on China reciprocal obligations since it was effectively faced with the alternatives of gaining the trust of resident states or of dealing with a situation in which they would seek to balance against its power by looking to the United States and to Japan. From about 1995 until the aftermath of the 2008 financial crisis China did in fact seek to cultivate ASEAN countries with much success, but following the crisis China became more assertive in the region in 2009-10 with the result that most of the ASEAN countries sought to balance against it with the United States and Japan. However, the ASEAN states did not wish to see a confrontation between the two giants in which they had to choose between them. By this stage China had become their most important economic partner and it was well understood that China was a permanent geographical presence, whereas the United States, on the other side of the Pacific, could choose to place less emphasis on Southeast Asia. Unlike China, Japan had no territorial disputes or maritime claims in Southeast Asia.

But it did have such disputes with each of its neighbors in Northeast Asia, which as we shall see in the next chapter, constrained its diplomatic maneuverability considerably. Similarly, the historical memory of Japan’s wartime aggression was less of an obstacle to the cultivation of good relations in Southeast Asia than in Northeast Asia. Thus Japan encountered less distrust in its dealings with Southeast Asian countries than China. However, in the 1960s and 1970s Japan tended to be regarded with a degree of suspicion, as its major companies appeared focused entirely on their own interests, leading to the charge that the Japanese were “economic animals.” It was not until Prime Minister Takeo Fukuda’s visit in 1977 (after the communist victories in Indo-China) when he committed Japan to building “heart to heart” understandings with the ASEAN countries that Japanese diplomacy began to respon d mo re actively to their interest s.1