Asia's New Cold War

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Man of the moment Captain Zhan gets a hero's welcome on Sept. 27 in his home village in China's Fujian province

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The country that has best kept the peace in this fractious neighborhood is also the one not nursing any territorial grievances: the U.S. Under long-standing security alliances, Washington vows to deploy U.S. forces to protect its Asian allies if any hostile nation for which read: China were to attack. In late September, around the same time Chinese Premier Wen Jiabao refused to meet his Japanese counterpart in New York City because of the island spat, Japanese Foreign Minister Seiji Maehara said U.S. Secretary of State Hillary Clinton told him the Diaoyu/Senkaku islands were covered by Article 5 of the U.S.-Japan security pact, which calls for America to defend territories under the administration of Japan should they come under attack.

It's hard to believe that the U.S. would truly contemplate a war with China over a sprinkling of rocks in the East China Sea. Nevertheless, Washington's assurances were welcomed in a country increasingly insecure about being overshadowed by its giant neighbor. It's not just Japan that feels that way. With China's economic and political sway expanding in Asia just as Washington seems distracted by wars in Iraq and Afghanistan, other Asia-Pacific nations have been urging the U.S. to reorient its foreign policy in the region. "China will enlarge its influence in Asia and will be competing with the U.S. for influence in Asia," says Niu Jun, professor of international relations at Peking University. "Whether this competition is good or not for Asia, we will have to see in the future."

The U.S. has taken notice. In a frank assessment earlier this year, Admiral Robert Willard, head of U.S. Pacific Command, told the House Armed Services Committee that China's rapid military modernization as evidenced by double-digit growth of its military budget over the past decade appears "designed to challenge U.S. freedom of action in the region or exercise aggression or coercion of its neighbors, including U.S. treaty allies and partners." To counter China, President Barack Obama, who spent part of his childhood in Asia, has been assiduously reaffirming U.S. ties with its Asian partners. On Sept. 24, Obama held a summit with leaders of the 10-member Association of Southeast Asian Nations (ASEAN), which includes key American friends such as Singapore and Thailand. Pledged Obama: "As President, I've made it clear that the United States intends to play a leadership role in Asia."

Home Game
There's reason to think he means what he says. Bilateral relations with Vietnam, for example, have blossomed to the point where the countries conducted joint military exercises in the South China Sea in August. That didn't please China any more than did recent naval drills by U.S. and South Korean troops in the Yellow Sea, which borders China's coast. Along with other ASEAN members vying with China over the Spratly and Paracel islands, Vietnam was delighted when Secretary Clinton said in July that a peaceful resolution of territorial spats in the South China Sea was an American "national interest." China hated that too. "There is a perception among some Chinese that the U.S. wants to weaken China and is using other countries to contain China," says Shen Dingli, director of the Center for American Studies at Fudan University in Shanghai.

Of course, foreign policy often has as much to do with domestic affairs as international ones. It makes sense for Obama to get tough with China when the supposed manipulation of its currency is being blamed at home for U.S. job losses. Similarly, Japanese Prime Minister Kan, who just survived a leadership challenge from within his own party, may have used a firm stance on the Diaoyu/Senkaku issue not only to placate a public ever more wary of Beijing but also to bolster his own precarious political position.

Strange though it may be to contemplate the Chinese leadership is hardly bound by the ballot box the same domestic imperative probably applies in Beijing too. Nationalist sentiment is on the rise in China, which doubtless makes its leaders feel that they need to talk tough on any territorial disputes involving the nation responsible for the brutal 1931-45 occupation of much of the country. The fishermen of Gangfu had better get used to choppy waters.

This article originally appeared in the October 11, 2010 issue of Time Asia magazine.