NBR Analysis: Volume 17

“Going Out”: China’s Pursuit of Natural Resources and Implications for the PRC’s Grand Strategy Number 3, September 2006

volume 17, number 3, september 2006 nbr analysis Informing and Strengthening Policy in the Asia-Pacific Foreword . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .67 Richard J. Ellings “Going Out”: China’s Pursuit of Natural Resources and Implications for the PRC’s Grand Strategy . . . . . . . . . . . . . . . . . .69 Aaron L. Friedberg [This page intentionally left blank.] 67 Foreword Though China has long possessed many elements of power—a sizeable population, nuclear capabilities, and a permanent seat on the United nations security Council—the country’s current rise to global influence is the result of three decades of extraordinary economic development. During this time the Chinese economy has experienced an average GDP growth rate of approximately 8% per annum, with total trade volume increasing at a clip of nearly 20% per year, to well over one trillion dollars currently. spearheading the leap in trade has been the manufacturing sector, which has accounted for more than 90% of China’s total exports. Driven by manufacturing, beijing has increasingly aimed to secure a variety of natural resources necessary to fuel China’s continued economic growth, including petroleum, iron ore, copper, rubber, foodstuffs, and uranium. China’s dependence on resources from abroad increasingly affects the way in which beijing interacts with the international system. in favorable circumstances the pursuit of natural resources has lead to increased contacts and interdependence with the international community, although Chinese strategy has at times seemed to be neomercantilist and almost always devoid of human rights or humanitarian considerations. Of future concern is that in some crisis or discord, the drive to acquire stable supplies of resources could put strains on the international system, perhaps even of a similar nature to those that contributed to the violent rise of Germany and Japan. in light of the critical need to increase understanding among the policymaking community of China’s global pursuit of natural resources and the inherent implications of such activities for international system, The national bureau of asian research (nbr) conducted a study to examine the trajectory of beijing’s resource diplomacy. in this NBR Analysis, one of the study’s contributors, Dr. aaron Friedberg, Professor of Political science and international affairs at Princeton University’s Woodrow Wilson school of Public and international affairs, explores the impact of China’s pursuit of natural resources on its post-Cold War grand strategy. He analyzes how the country’s growing reliance on imported natural resources is influencing and may significantly 68 alter beijing’s long-term goals. additionally, he discusses both the implications of these efforts for China’s relationship with the United states and the prospects for domestic political reform in China. richard J. Ellings President The national bureau of asian research 69 “Going Out”: China’s Pursuit of Natural Resources and Implications for the PRC’s Grand Strategy Aaron L. Friedberg Aaron L. Friedberg is Professor of Politics and international affairs at Princeton University’s Woodrow Wilson school of Public and international affairs. He is the author of two books, The Weary Titan: Britain and the Experience of Relative Decline, 1895–1905 and In the Shadow of the Garrison State: America’s Anti-Statism and Its Cold War Grand Strategy, and co-editor (with richard Ellings) of the first three volumes in the national bureau of asian research Strategic Asia series. From June 2003 to June 2005 he served as Deputy assistant for national security affairs and Director of Policy Planning in the Office of the Vice President. Friedberg chairs the board of Counselors of nbr’s Kenneth b. and anne H. Pyle Center for northeast asian studies. He can be reached at . 70 Executive Summary This essay explores China’s intensifying pursuit of natural resources and implications for beijing’s post-Cold War grand strategy. Main Argument: • China’s post-Cold War grand strategy is characterized by four axioms: - “avoid conflict,” primarily with the United states - “build comprehensive national power” - “advance incrementally” in order to consolidate a position of strength - “maintain stability, defend sovereignty, achieve pre-eminence, and pursue parity” • China faces a growing need to secure natural resources and raw materials, most notably energyandmineralssuchasironore,copper,andaluminum.Thisneedhasdrivenbeijingto expand overseas trade and investment at a rapid pace even in areas where China’s presence has traditionally been comparatively limited. The need for resources is accelerating China’s emergence as a truly global power. • China’s pursuit of natural resources is affecting the country’s grand strategy in various ways. in the short term, the PrC’s increasing...