(2nd LD) U.S. still maintains power amid China's rise: scholars

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By Kim Young-gyo
HONG KONG, Nov. 5 (Yonhap) -- The United States will continue to command its
influence over the Asia-Pacific region, although China has emerged as a new
power, scholars said Friday.
"Is the U.S. economic star on the wane? To some degree, yes," Michael Cox, a
professor at London School of Economics and Political Science, said at a
conference hosted by Hong Kong's Lingnan University.
"But (others) still have a very long way to go to catch up with a country whose
gross domestic product (GDP) in 2009 was still light years ahead of the rest."
The U.S. GDP was US$14 trillion in 2009, compared to China's $8.8 trillion.
While the global financial crisis sparked by the collapse of U.S. banking giant
Lehman Brothers in 2008 has raised worldwide doubts about the Western economic
model, the U.S. has the edge over China, the scholar said.
Quoting from a book written by Carla Norloff, a University of Toronto professor,
Cox said the United States has the global advantage because of the size of its
market, the wealth of its people and its control over world finance.
"The very fact that the U.S. can run such huge deficits with its trading partners
and such vast budget deficits, too, is less a sign of decline and more an
indication of strength," he said.
"After all, if it can get foreigners, including willing Asians, to buy its debt,
while printing dollars at will to pay its outstanding bills, this only shows what
structural power it still has."
Cox emphasized the U.S. dollar is still and will be for a while the only currency
that has international pulling power.
"If the U.S. were in so much trouble ... why do U.S. Treasury bills show little
sign of losing their allure?" he said.
China's economic size has been rapidly growing, replacing Japan as the world's
second-largest economy earlier this year.
According to a Goldman Sachs report, the U.S. economy will likely be at least 10
percent smaller than China's by 2050.
John Ikenberry, a professor of politics and international affairs at Princeton
University, said the U.S. will not exercise hegemony in the region as it has in
the past, but the future will not be a simple story of China rising up and
pushing the U.S. out.
"(It will be) quite the opposite. The rise of China is actually serving to draw
the U.S. into the region in new ways," he said, giving an example of the recent
U.S. involvement in meetings of the 10-member Association of Southeast Asian
Nations (ASEAN). U.S. Secretary of State Hillary Clinton attended the most recent
meeting held in Hanoi last week.
"At the same time, East Asia is increasingly divided between its two spheres --
economics and security," the U.S. professor said. "China is the dominant economic
power in the region, while the U.S. is the dominant security power."
Ikenberry explained that the U.S. continues to be the dominant security provider,
while China is increasingly at the economic center of the region.
China's neighboring countries, including South Korea, have all been experiencing
growing trade and investment ties to China. China is the largest buyer of South
Korean-made goods and has contributed to Seoul's sizable trade surplus in recent
years, while South Korea is China's third-largest trading partner after the
United States and Japan.
The double hierarchy of economy and security has presented dilemmas for many
states in East Asia, Ikenberry stressed.
"It will not be a simple hegemonic order led by the U.S. But China will also not
simply rise and assume a hegemonic role in the region," he said.
Moon Chung-in, a professor of South Korea's Yonsei University, said South Korea
would have to make a strategic choice in the age of "uncertain and precarious"
regional dynamics.
"Balancing and hedging against China through the strengthened alliance tie with
the U.S. is likely to bring about negative consequences for South Korea," Moon
said. "It could entail enormous economic costs. Trade volume with China is
greater than the combined sum of its trade with Japan and the U.S."
He added that the bandwagon strategy of taking sides with rising China is not a
desirable option for South Korea.
In the medium-to long-term, the most desirable option will be the construction of
a multilateral security cooperation regime similar to the Organization of
Security Cooperation in Europe (OCSE), the scholar explained.
ygkim@yna.co.kr
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