EXPECTATIONS FOR PRESIDENT OBAMA AND THE FUTURE OF

C O N F I D E N T I A L SECTION 01 OF 05 SHANGHAI 000041 SIPDIS STATE FOR EAP/CM, EAP/FO TREASURY FOR AMB HOLMER, WRIGHT, TSMITH, AND OASIA - DOHNER, HAARSAGER, CUSHMAN U.S.DOC FOR ITA MAC DAS KASOFF, MELCHER, SZYMANSKI E.O. 12958: DECL: 1/21/2034 TAGS: PREL PGOV ECON EFIN ETRD CH PHUM PINR TW SUBJECT: EXPECTATIONS FOR PRESIDENT OBAMA AND THE FUTURE OF U.S.-CHINA RELATIONS: VIEWS OF SHANGHAI SCHOLARS REF: 08 SHANGHAI 533 CLASSIFIED BY: Beatrice Camp, Consul General, U.S. Consulate, Shanghai, U.S. Department of State. REASON: 1.4 (b),(d) ¶1. (C) Summary: Shanghai scholars view U.S.-China relations the past eight years in a positive light and do not expect big changes under President Obama, though they admit they know little about the new President. They emphasize the need for bilateral cooperation on the global financial crisis but fear that President Obama and a Democratic Congress will enact protectionist measures. Human rights activists may use several anniversaries in 2009 to criticize China, potentially hurting bilateral relations, they say. Some caution against an Obama-Dalai Lama meeting before the new President establishes relations with China's leaders. Most scholars envision a "win-win-win" scenario in U.S.-China-Taiwan relations. There are many other international issues that require cooperation between the United States and China in the years to come, including anti-terrorism, nonproliferation, energy, and the environment, the scholars say. End summary. ¶2. (U) Poloff met with Shanghai scholars in January 2009 to discuss their impressions of the past eight years and expectations for U.S.-China relations under the Obama Administration. For a complete list of interlocutors, see appendix below. Reflections on Bush -------------- ¶3. (C) Shanghai scholars generally view U.S.-China relations during the past eight years in a positive light. Although the United States and China did not agree on all issues, such as human rights, President Bush "did his best" to keep the relationship stable, said Shen Dingli, Director of the Center for American Studies at Fudan University. Lin Gang, Professor of Political Science at Shanghai Jiaotong University, thinks the issues confronting both countries have become more complex in recent years, causing bilateral disputes in some areas but also creating opportunities for unprecedented cooperation. He believes the Bush Administration was successful in utilizing various channels of communication (e.g., direct hotline between Presidents Bush and Hu, Strategic Economic Dialogue, etc.) to strengthen bilateral cooperation. ¶4. (C) Although the Chinese Government may be sad to see President Bush go, the Chinese public has mixed feelings about him, said several scholars. Ding Xinghao, President of the Shanghai Association of American Studies, believes the Chinese public likes President Bush "from a selfish perspective" because he focused attention on improving relations with China. However, the Chinese people also see President Bush's China policy as his only foreign policy success, said Ding. Shen Dingli agrees that there is a gap in perception towards President Bush between the Chinese Government and Chinese public. The Chinese public, however, was impressed by Bush's "open" and easygoing style during the Olympics, as television cameras captured him interacting with athletes and "sitting among commoners" during several Olympic events, said Zhu Mingquan, Professor in the Department of International Politics at Fudan University. Zhu noted that President Hu and his wife were seen sitting among the crowd during another sporting event soon afterwards, perhaps having learned something from President Bush. Looking Ahead: Expectations for President Obama -------------- -------------- ¶5. (C) The scholars do not expect major changes in U.S.-China relations under President Obama. Zhu Mingquan thinks U.S.-China relations have overcome many ups and downs over the past 30 years and will likely overcome other near-term challenges. Lin Gang believes the new administration will not look upon China as SHANGHAI 00000041 002 OF 005 an "enemy" as he believes President Bush did when he first took office. Lin cautioned that "if you think of China as an enemy, China will become an enemy," but he believes President Obama, like President Bush, will adopt a pragmatic approach towards China. Shen Dingli, however, thinks the real test for bilateral relations will come in the first six months, when both sides attempt to build rapport. The Chinese Government does not expect relations to be "as bad as the start of the Bush years" but is uncertain whether it will be as good as the end of President Bush's term. It is thus imperative that President Obama establish good relations with China's leaders from the outset, said Shen. ¶6. (C) Pan Rui, Professor in the Center for American Studies at Fudan University, said President Obama will improve America's soft power and image overseas, but regarding policy, he asked rhetorically, "Bush was ABC (Anything But Clinton),so will Obama be ABB (Anything But Bush)?" He speculated that this will not happen, particularly in regards to U.S. policy towards China as many of President Obama's foreign policy advisors are "old China hands" from the Clinton years and many Democrats and Republicans in Washington share the view that President Bush's China policy was "one of his few successes." Wu Xinbo, Deputy Director of the Center for American Studies at Fudan University, similarly believes President Obama and his advisors have a "full picture" of U.S.-China relations and will thus adopt a "balanced approach," cognizant that the relationship cannot be defined by any single issue but must be viewed within a "multidimensional prism." Just Who is Obama? -------------- ¶7. (C) The scholars appear familiar with the people surrounding President Obama, but admit that they know little about the new President himself. Zhuang Jianzhong, Professor in the Center for National Strategic Studies at Shanghai Jiaotong University, said he has no strong personal impressions of President Obama but that he seems "reasonable" and "looks like he's in good shape" (referring to photos recently circulating over the Internet of then President-elect Obama swimming in Hawaii). There was general excitement, even in China, over Obama's election, but "if you sit back and think about it, I'm really not sure what kind of person he is," said Ding Xinghao. Several scholars agreed that most Chinese only have "superficial" knowledge about the new President of the United States. ¶8. (C) The scholars raised concerns about what they perceive as President Obama's lack of experience in foreign policy, particularly regarding China. Ding Xinghao thinks President Obama "may not understand China very well, and China doesn't understand what he's thinking." Shen Dingli said President Obama's "inexperience" will create difficulties for him "managing his more experienced Cabinet members," including Secretary of State-designate Hillary Clinton, whom Shen characterized as "forceful" and "ideological." Ding Xinghao also asked rhetorically if President Obama and Secretary Clinton would be able to "maintain a harmonious relationship." Shao Yuqun, Professor at the Shanghai Institutes for International Studies (SIIS) noted that, although President Obama emphasized "change" during his campaign, many of his Cabinet appointees are part of the "old establishment." She thinks this apparent discrepancy between his campaign rhetoric and reality has confused some in China about what President Obama really stands for. Economy/Trade: Concerns About U.S. Protectionism -------------- --- ¶9. (C) The scholars agreed that the main near-term focus for President Obama will be the global financial crisis, and strengthening economic/trade cooperation will be one of, if not the most important challenge for U.S.-China relations over the next few years. They stressed the need for more U.S.-China cooperation in handling the crisis, but expressed concerns that continuing domestic economic problems may force President Obama SHANGHAI 00000041 003 OF 005 to adopt protectionist measures, potentially causing rifts in bilateral economic relations. Zhuang Jianzhong expects Democrats in Congress to focus on unemployment and trade issues, pushing for more protectionist legislation. Although President Obama may not want to be protectionist, he will have to think more about domestic job creation, which could lead to protectionist measures, said Zhuang. ¶10. (C) Shen Dingli observed there is "widespread concern" in China over possible U.S. protectionism and trade disputes. He believes many members of the U.S. Congress are "local leaders" who, like the new President in his view, have a "mission" to protect "lower tier workers," and often blame job losses on China. Ding Xinghao thinks much of President Obama's past criticism of China for "currency manipulation" and the "export of U.S. jobs" was only campaign rhetoric, and the new President probably will not adopt "comprehensive protectionist measures" against China. But he expects President Obama to take steps to satisfy his Democratic constituents, particularly as implementing short-term protectionist measures would be easier than solving longer-term issues such as healthcare and the housing crisis, said Ding. ¶11. (C) The Shanghai scholars agreed that, although the Strategic Economic Dialogue (SED) may not have produced many concrete results, it was a useful channel of communication that should be continued, particularly given the current economic crisis. Their concern, however, is focused not on whether the new U.S. administration will continue with a bilateral dialogue mechanism (even if it takes a different name and format),but whether the mechanism will be upgraded or downgraded, and who would take charge. Pan Rui mentioned that several Chinese officials who had participated in the SED felt that two meetings a year was "too much." They think once a year is enough (to give the Chinese adequate time to prepare) and that the agenda should be "more fair" (i.e., less demanding of China),according to Pan. Human Rights and Tibet -------------- ¶12. (C) Several scholars noted that 2009 will mark the 50th anniversary of the Lhasa uprising in Tibet that led to the flight of the Dalai Lama (March) and the 20th anniversary of the Tiananmen incident (June). They think some members of the U.S. Congress will use these occasions to criticize China's overall human rights situation. Pan Rui believes that, because of these anniversaries and the economic downturn (which could lead to domestic unrest),the Chinese Government this year will be particularly sensitive to criticism on human rights issues. Zhu Mingquan, however, thinks the human rights issue will not derail the positive trajectory of bilateral relations. China understands the complexities of U.S. domestic politics and the need for President Obama and U.S. politicians, particularly Democrats, to raise human rights issues, said Zhu. ¶13. (C) Some scholars, however, warn that a meeting between President Obama and the Dalai Lama would create serious problems in bilateral relations. Shen Dingli thinks Tibet, though not the main issue in bilateral relations, could be the "most problematic" issue this year given the 50th anniversary of the Tibet uprising in March. He cautioned against a Presidential meeting with the Dalai Lama, particularly before President Obama first meets with Chinese President Hu at the next G20 meeting in London in April 2009. It is vital for Presidents Obama and Hu to establish good personal relations before President Obama meets the Dalai Lama, "if that meeting (between President Obama and the Dalai Lama) is unavoidable," argued Shen. Taiwan: "Win-Win-Win" Scenario -------------- ¶14. (C) The scholars are generally optimistic about the future of U.S.-China-Taiwan trilateral relations. Zhuang Jianzhong believes the trilateral relationship will be a "win-win-win" situation, particularly with the "troublemaker" (former Taiwan SHANGHAI 00000041 004 OF 005 President Chen Shui-bian) out of the picture. Lin Gang, who started a new Center for Taiwan Studies at East China Normal University in October 2008, also thinks a "win-win-win" scenario is very likely, as long as the United States just "lets both sides (Taiwan and the Mainland) work things out." He hopes that the United States will not get sucked into Taiwan's internal politics and remains "neutral," even if pressed by Taiwan's opposition Democratic Progressive Party (DPP) to take up Chen Shui-bian's indictment and other issues as human rights causes. ¶15. (C) Several scholars are hopeful that cross-Strait relations will continue to improve this year. Lin Gang, Zhuang Jianzhong, and Pan Rui are optimistic about Taiwan's prospects for gaining observer status in the World Health Assembly. They also think the Mainland will likely reduce its deployment of missiles across the Taiwan Strait as a sign of goodwill. Pan Rui, however, echoed a concern heard frequently in East China academic circles that the United States may not actually desire rapid progress in cross-Strait relations, especially if the United States feels left out in the cold. "What is the U.S. bottom line...what is the degree of improvement acceptable to the U.S.?" he asked. He and Lin Gang believe U.S. arms sales to Taiwan would undermine "mutual trust" between the United States and China, but other scholars like Shen Dingli think China would protest U.S. arms sales only to "save face." Other International Issues -------------- ¶16. (C) There are myriad other international issues that require cooperation between the United States and China in the years to come, including anti-terrorism, nonproliferation, energy, and the environment, said these Shanghai scholars. Both countries will continue their joint anti-terror efforts, but this is not necessarily China's priority, said Shen Dingli. Stabilizing the situation in its immediate vicinity, particularly the Korean Peninsula, and securing energy and other natural resources are a greater concern for China, asserted Shen. The bilateral relationship could be tested if the United States "demands too much" from China on the North Korean nuclear issue, or if President Obama "runs out of patience" with the UN Security Council regarding sanctions on Iran, said Shen. ¶17. (C) Pan Rui thinks the "post-Kyoto era" will pose a serious challenge for China on the environmental front. Since President Obama is expected to focus more than his predecessor on environmental issues, this could present new areas of cooperation between the United States, China, and Japan in developing green technology, but it could also create problems if President Obama places too much pressure on China, particularly given the current economic climate, said Pan. Several scholars also speculated that the United States and China will continue to take different approaches to energy-rich but unsavory regimes like Sudan and Venezuela, but that it will not lead to "strategic confrontation" between the two countries, as both realize they must cooperate on a host of other international issues. Comment -------------- ¶18. (C) Shanghai scholars of international relations believe they are uniquely positioned to comment on and offer advice to policymakers in Beijing on U.S.-China relations because of Shanghai's historical role in U.S.-China relations (i.e., the 1972 Shanghai Communiqui) and the city's long-standing role as China's "window" to the outside world. Shanghai international relations scholars also participate in international conferences and track two exchanges with U.S. and other counterparts. Although the Shanghai scholars are concerned that President Obama may adopt populist measures on trade and human rights "to please his Democratic base," they think the new U.S. President will be "pragmatic" for the most part and continue positive U.S.-China cooperation on international issues, most importantly the global financial crisis. One of their biggest fears is that the United States will become isolationist as it tackles its SHANGHAI 00000041 005 OF 005 domestic problems. Although some scholars think China "can be a global player," as shown by its recent deployment of naval vessels to the Horn of Africa, and that there is a "younger generation" of China's leaders who are more nationalistic and believe China should "have its own voice," most of our interlocutors still believe that China "cannot replace the United States," at least in the near term. China will continue to look to America for leadership on the global stage, they said. Appendix: List of Interlocutors -------------- ¶19. (U) Ding Xinghao, President, Shanghai Association of American Studies Shen Dingli, Director, Center for American Studies, Fudan University Wu Xinbo, Deputy Director, Center for American Studies, Fudan University Zhuang Jianzhong, Professor, Center for National Strategic Studies, Shanghai Jiaotong University Pan Rui, Professor, Center for American Studies, Fudan University Shao Yuqun, Professor, Shanghai Institutes for International Studies (SIIS) Lin Gang, Professor of Political Science, Shanghai Jiaotong University Zhu Mingquan, Professor, Department of International Politics, Fudan University CAMP