Munich Security Report 2017

East Asia: Pacific No More?

In East Asia, the risk of a major security crisis is higher than it has been in many years. With the five-yearly Central Committee Congress of the Chinese Communist Party scheduled for this fall, “[President] Xi will be extremely sensitive to external challenges to his country’s interests,” the Eurasia Group, a risk consultancy, writes. “He will be more likely than ever to respond forcefully to foreign policy challenges.”1 In the coming months, such challenges could emanate from numerous hot spots ranging from the South China Sea and Taiwan to North Korea – or from the new US administration. During his confirmation hearings in January 2017, the designated US Secretary of State Rex Tillerson possibly set the stage for a major clash: “We’re going to have to send China a clear signal that, first, the island-building stops and, second, your access to those islands also is not going to be allowed,” he said, referring to China’s construction of artificial islands in the South China Sea.2 China has long considered large parts of the South China Sea its own sovereign territory and continues to do so in spite of the recent Permanent Court of Arbitration ruling, which sided with the Philippines (and with the position of most of the international community).3 

“[TPP] was all about the United States showing leadership in the Asia region. […] But in the end, if the US is not there, that void has to be filled. And it will be filled by China.”9


However, China seems confident of its growing power and of limited opposition across the region. Some countries are already seeking closer ties with Beijing, perhaps wondering about the durability of the US strategic “rebalancing” to the Asia-Pacific. In November 2016, Australia announced that it would now support China-led regional trade deals as plans for the US-led Trans-Pacific Partnership (TPP) were unravelling.4 During an October 2016 visit to Beijing, Philippine President Duterte questioned his country’s military agreement with the United States: “I announce my separation from the United States. […] America has lost. […] I've realigned myself in your [China’s] ideological flow.”5 Finally, US allies South Korea and Japan are left wondering what the mixed messages coming from the US mean. During the campaign, Donald Trump had suggested that it might “not be a bad thing” if both countries developed nuclear weapons in order to be able to defend themselves against North Korea.6 

The most dangerous regional crisis is likely to emerge over Pyongyang’s nuclear weapons program. In defiance of international law, the country has made significant progress in 2016 as its program shifted from “developing a nuclear capability in the abstract to deploying a nuclear-armed force of ballistic missiles,” as Jeffrey Lewis puts it.”7 It is getting closer to an intercontinental ballistic missile capability that would enable it to hit the US West Coast with a nuclear weapon. “It won't happen.” Trump tweeted in January 2017.8 But it is unclear how he intends to prevent this North Korean capability. If the US adds sanctions (including ones that hit Chinese banks), presses China to increase its coercive measures against North Korea, or even opts for military steps, a major US-China crisis could be right around the corner. And, at any point, Pyongyang could plunge Northeast Asia into chaos. 

“China has been taking out massive amounts of money and wealth from the US in totally one-sided trade, but won't help with North Korea. Nice!”10 

3 JANUARY 2017


  1. Eurasia Group, “Top Risks 2017: The Geopolitical Recession,” January 2017,, p. 5. 
  2. Charles Clover and Ed Crooks, “Tillerson Sets Stage for Clash With Beijing Over South China Sea,” Financial Times, 12 January 2017,
  3. Permanent Court of Arbitration, “Press Release. The South China Sea Arbitration (The Republic of the Philippines v. The People’s Republic of China),” 12 July 2016,
  4. Katharine Murphy, “Australia Signals Support for Chinese-led Trade Deals to Replace TPP,” The Guardian, 17 November 2016,
  5. Ben Blanchard, “Duterte Aligns Philippines With China, Says U.S. Has Lost,” Reuters, 20 October 2016,
  6. “Transcript: Donald Trump Expounds on His Foreign Policy Views,” The New York Times, 27 March 2016,
  7. Jeffrey Lewis and Nathaniel Taylor, “North Korea’s Nuclear Year in Review – And What’s Next,” Nuclear Threat Initiative, 20 December 2016,
  8. Donald J. Trump, Twitter, 2 January 2017, ref_src=twsrc%5Etfw
  9. See Peter Hartcher, “The Moment the US Gave the World to China,” Sydney Morning Herald, 22 November 2016,
  10. Donald J. Trump, Twitter, 2 January 2017,
  11. Infographic provided to MSC. Estimates based on James Martin Center for Nonproliferation Studies and US Defense Department assessments.
  12. The International Institute for Strategic Studies (IISS), The Military Balance 2017, Routledge (London), 2017 (forthcoming), 
  13. See endnote 12. 
  14. See endnote 12. LHA-Landing Helicopter Assault; LHD-Landing Helicopter Dock; LPD-Landing Platform/Dock. A note on China: Two of the destroyers commissioned between 2001 and 2005 were imported, as was one of those commissioned between 2006 and 2010.