Foreign Relations of the United States, 1977–1980, Volume XXII, Southeast Asia and the Pacific

128. Intelligence Memorandum Prepared in the Central Intelligence Agency¹

RPM 78–10204

Washington, May 12, 1978

CHINA AND SOUTHEAST ASIA

The Chinese traditionally have attached special importance to their relations with Southeast Asian countries and have considered the region one where China’s influence ought to be greater than that of any other country. Through much of the past quarter century, Peking regarded US activity in the region—especially its military presence—as an indirect threat to China’s own security. It also viewed most of the governments in the region that had close relations with the US as no more than American sycophants. Consequently, Peking had cordial relations only with North Vietnam, and, at times, Burma, Cambodia and Laos. The Chinese had close ties with and provided varying levels of support to communist parties in the region, some of which were engaged in active anti-government insurgencies.

When the US began to draw down its involvement in the region in the early part of this decade, Peking adopted a dramatically different stance. In addition to taking a far more relaxed view of the remaining US presence in the region, the Chinese began to court Southeast Asian governments intensively and to scale down the involvement with communist insurgencies in the area. In 1974 and 1975, Peking established diplomatic relations with Malaysia, Thailand, and the Philippines, and improved ties with Burma. Only Indonesia, which suspended diplomatic relations in 1965, and Singapore have not yet restored ties with Peking.

Peking’s objectives during this period have been to establish the closest possible official relationships with Southeast Asian countries in order to block the growth of Soviet influence in the region. The Chinese have been especially sensitive about the possibility that the USSR would attempt to fill the “vacuum” left by the reduced US presence, a concern that Chinese officials expressed colorfully by warning Southeast Asian countries not to “drive the wolf out the front door and let the tiger enter by the back door.” In fact, the Chinese have become so concerned about possible Soviet encroachments that they have implicitly approved a continuing US military presence in the region. On a number of occasions, Chinese officials have assured Southeast Asian leaders that, while they object “in principle” to the presence of foreign troops in another country, they understand the “special circumstances” that necessitate the continued US military presence in the Philippines.

Indochina

A secondary but growing Chinese concern is Vietnam’s role in the region. Since the war ended in 1975, signs of friction between Peking and Hanoi have become increasingly apparent. While these indicators have focused on issues such as the two country’s conflicting claims to islands in the South China Sea, the land border itself, and most recently, Vietnamese treatment of the ethnic Chinese population in Vietnam, Peking’s fundamental concerns center on what it sees as Hanoi’s tilt toward Moscow and the possibility of growing Vietnamese influence in the region. The Chinese are especially displeased with the prospect of Hanoi’s domination over the rest of Indochina.

Peking has addressed concern about Hanoi’s intentions in a number of ways. The Chinese have maintained close ties with Cambodia hoping that its xenophobic and anti-Vietnamese leadership will help brake Hanoi’s regional ambitions. But the Chinese have been careful not to allow their differences with the Vietnamese to reach the point where Hanoi would be driven deeper into Moscow’s arms. Finally, Peking has encouraged other countries in the region—as well as the US—to improve their relations with Hanoi, apparently in the hope of blunting whatever “expansionist” ambitions the Vietnamese might have, as well as limiting Soviet leverage in Hanoi.

The outbreak of heavy fighting between Vietnamese and Cambodian troops late last year confronted Peking with a dilemma.² The Chinese, while publicly adopting a relatively evenhanded stance on the conflict, were reluctant to reduce their support to Phnom Penh for fear that this would undercut Phnom Penh’s utility as a counterweight to Hanoi. At the same time, Peking would risk a complete break with Hanoi if its support for Phnom Penh’s side became too obvious. The Chinese, therefore, officially expressed “regret” over the fighting and urged the two sides to negotiate their differences. Although the Chinese have insisted that they will not play a mediating role in the dispute, there are signs that Peking has directly and at high levels urged both sides to resolve the problem peacefully.

Meanwhile, the continuation of this stalemate between Cambodia and Vietnam has added salt to old wounds in the Peking-Hanoi relationship. Reports of small-scale fighting along the Vietnam-China border have become increasingly frequent since the beginning of the year. Chinese posturing along the border may be intended, in part to remind Hanoi that China will not take lightly Vietnamese meddling in Cambodia. A Vietnamese decision in March to nationalize all businesses and to send “traders” to rural areas hit the ethnic Chinese community in Vietnam especially hard and apparently resulted in anti-government demonstrations in Cholon, Saigon’s “Chinatown.” There are reports that large numbers of Chinese are attempting to flee Vietnam and that many of them are trying to reach China. Peking responded to the situation by publicly warning Hanoi that it was “watching developments closely,” the most direct public acknowledgment China has yet made of the level of friction between the two countries.

Peking almost certainly would welcome US initiatives to regain a degree of influence in Indochina. The Chinese have realized for some time that their association with the Cambodians is not enough to block Soviet and Vietnamese designs in the region. Peking believes that the establishment of US-Vietnam relations, for example, would serve to limit Soviet influence in Hanoi and discourage any “hegemonistic” plans Vietnam may have in the area.

ASEAN

China’s recent policies toward the ASEAN countries have also been deeply influenced by Peking’s growing concern over Soviet and Vietnamese intentions in the region. Peking’s courtship of these nations has been determined, patient, and, for the most part, successful. The Chinese have restated their own interest in the region and have attempted to allay traditional Southeast Asia fears of Chinese domination.

Peking has focused on its strong support of ASEAN as a vehicle for unifying and strengthening the region, implicitly to prepare it to resist “outside interference.” China insists that it will never become a “superpower” and that it will not interfere in the internal affairs of these countries. Chinese diplomats who have arrived in Manila, Bangkok, and Kuala Lumpur since the Chinese missions were opened have been careful not to stir up old concerns about Chinese meddling. For the most part, the Southeast Asian governments have been pleased with the cautious behavior of the Chinese diplomats.

China’s relations with Southeast Asian countries have for many years been strained by Chinese involvement in the large overseas Chinese communities and its support of communist parties in the region. When ethnic Chinese were among the leaders of communist groups, these problems have overlapped.

In approaching the first problem, Peking has emphasized that it is encouraging ethnic Chinese to become citizens of the countries in which they reside. Peking has rejected the concept of dual nationality, and has urged residents who retain Chinese citizenship to abide by the laws and customs of their host countries. Earlier this year, as part of its effort to induce overseas Chinese to return to China to contribute to the modernization drive, Peking did insist on its right to protect the interests of Chinese citizens in other lands and noted that it retained a “kinship” relationship with all ethnic Chinese abroad. Privately, however, Peking has played down this aspect of its overseas Chinese policy, asserting that it was intended primarily for an internal Chinese audience.

Peking realizes that it has little to gain by pressing too far on this issue, especially since it would jeopardize the diplomatic progress the Chinese have made in the past five years. Nonetheless, Peking’s renewed interest in overseas Chinese matters has aroused some old misgivings among the Southeast Asians. While China’s relations with countries in the region probably will not be seriously ruffled, Southeast Asian governments clearly intend to watch Chinese behavior carefully.

Peking is having more difficulty allaying Southeast Asian concerns about Chinese involvement with communist parties in the region. Although it has scaled down its involvement with the various communist insurgencies, Peking has refused, despite frequent Southeast Asian protests, to cut off ties with the local parties. The Chinese argue that strictly party-to-party relations should not interfere with continuing cordial official relationships. The levels of Chinese material support to local communist parties—none of which currently represents a threat to existing governments—remains relatively low, but the Southeast Asians are displeased by China’s reluctance to end its links with them.

[1 paragraph (8 lines) not declassified]

Most Southeast Asian leaders clearly are skeptical of Chinese attempts to explain away their support to communists in this way, and a good deal of suspicion about Chinese intentions still exists in the region. Some Indonesian officials, for example, still cite their “special problem”—that of overseas Chinese involvement in the abortive coup attempt in 1965³ and the continuing distrust of Chinese residents—as the reason for their reluctance to resume normal relations with Peking. The Chinese have frequently made clear their readiness to normalize relations with Indonesia at any time, but the outlook is for continued stalling on Jakarta’s part. Singapore has indicated that it would wait for Indonesia to move before recognizing Peking.

The US and Southeast Asia

Peking believes that the US has an important role to play in Southeast Asia. Since the end of the Vietnam war, the Chinese have from time to time been distressed over what they saw as a US lack of interest in the region. They have clearly been pleased, however, by Vice President Mondale’s recent trip. For example, the Chinese press noted approvingly that, while the Vice President was in Manila, a joint statement was issued calling for the continued use by the US of Philippine military bases.⁴

The Chinese also are pleased with US contributions to the economic development of the region and can be expected to encourage the US to strengthen its economic ties with the Southeast Asian countries. The Chinese have shown special interest in the International Rice Research Institute in the Philippines and may urge the US to increase its involvement in projects of this kind. Chinese motivation here, of course, is to underscore the importance it attaches to strengthening the economy of the region as a hedge against possible Soviet inroads.

1. Source: Central Intelligence Agency, Office of Support Services (DI), Job 80T00634A: Production Case Files, Box 13, [unfoldered material], China and Southeast Asia. Secret; [handling restriction not declassified]. Prepared in the National Foreign Assessment Center. A note on the first page indicates that the memorandum was prepared by the East Asia-Pacific Division of the Office of Regional and Political Analysis in response to a request from the National Security Council.
2. See Document 32.
3. See Foreign Relations, 1964–1968, vol. XXVI, Indonesia; Malaysia-Singapore; Philippines, Documents 142–205.
4. See footnote 2, Document 321.