Abe and Xi: a year to remember?

Power and posturing in Asia can carry serious consequences as well as rewards, and good leadership is critical, Stephen R Nagy writes.

Assessing leadership in Northeast Asia requires at least three lenses: international and domestic achievements, and whether a momentum exists for future policy development.  Based on these three dimensions of leadership, Japan’s Prime Minister Shinzo Abe has had a positive and consequential 2015, with several key achievements, while China’s President Xi Jinping’s 2015 record is mixed, with both successes and miscalculations along the way.

First, the performance of Prime Minister Abe. Despite the loss of valuable political capital over the Collective Security Bill enacted in September 2015, and criticism over his stance on history, including the Comfort Women issue and Japan’s Imperial past, Abe has chalked up an important series of successful initiatives in both domestic and international realms that will have mid- and long-term positive consequences for Japan and the region.

Japan’s economy has prospered, despite facing the headwinds of a slowing Chinese economy, low energy costs, a shrinking population and a growing population of elderly. Abenomics has provided growth and increased inflation based on nominal GDP. This is before the benefits to be gained through the Trans Pacific Partnership. These economic wins in 2015 will gain modest momentum in 2016.

On the security and political fronts, Abe strengthened the Japan-US security alliance on his visit to the US in April.  He passed the divisive Collective Security Bill in September, enhanced cooperation with the Philippines through the provision of coast guard vessels, while at the same time strengthening military-to-military cooperation with Australia, India and Vietnam. On his recent visit to India, Abe concluded a deal to build India’s first Bullet Train, and for cooperation in the peaceful uses of nuclear energy.

This expansion of Japanese security, political and economic ties across the region can be interpreted as keiretsu gaikou (系列外交), in which Japan has been reorganising its political, security and economic relations in the East and South China Sea. This shifts Japan’s traditional practices of regional security from the Washington-Seoul-Beijing calculus, to one with many partners that lessens Japan’s sensitivity to shifts in the triangular relationship.

President Xi has also demonstrated astute leadership on many fronts in 2015. The Asian Infrastructure Investment Bank (AIIB), the One Belt, One Road Initiatives and the International Monetary Fund’s agreement to include the Yuan as part of the basket of reserve currencies are all major economic achievements for President Xi. They have expanded China’s global economic influence and profile through win-win agreements. These successes also demonstrate that China, under President Xi, can initiate multilateral agreements that compete with the US in terms of scope and broad appeal. China’s positive contributions to the Paris Agreement on Climate Change further demonstrate President Xi’s abilities to work at a global level.

Leadership success at the international and domestic level is also evident in the handling of China’s economic slowdown, which was on full view in 2015. Initial concerns over an economic meltdown were allayed by deliberate policy action and strong statements about a commitment to a soft landing and structural reform of the economy.

Domestically, on September 3 2015 President Xi presided over the 70th Anniversary of the “Chinese People’s War of Resistance against Japanese Aggression” or “China’s War of Resistance in the World Anti-Fascist War”. With former President Jiang Zemin and numerous foreigner dignitaries in attendance, Xi demonstrated that he is at the apex of the Chinese polity. Under his leadership the Chinese Communist Party has modernised the military, and strengthened its capabilities to prevent another “150 years of humiliation” and he has proved adept in terms of stable economic stewardship.

However, miscalculations on several fronts diminish what is otherwise a successful 2015 for the region. First and foremost has been the island building in the South China Sea. These activities have raised tensions in the region and created momentum towards security partnerships between claimants to the area and Japan as well as the US.

Second, cyber attacks by China on the US Office of Personnel Management and most recently on the Bureau of Meteorology have further eroded confidence in China’s often-touted peaceful mantra.

On the historical front, President Xi had both successes and failures. Successes include the registering of documents related to the Nanjing Massacre, perpetrated by the Japanese Imperial Army, and this global acknowledgement offers some solace to the victims and their families.

In contrast, the historical narrative related to the 70^th anniversary of the “Chinese People’s War of Resistance against Japanese Aggression” and the continued criticism of Japan for its apparent refusal to apologise and pay war reparations, was seen in many quarters as petty, dishonest and politically motivated.

As figures who can command both stability and potential friction, the past, present and future leadership of President Xi and Prime Minister Abe will continue to be pivotal importance.  Their performance is crucial to peace and growth in the region.