JAKARTA (THE JAKARTA POST/ ASIA NEWS NETWORK) - Early last year, Poppy Winanti and I wrote about China's increased investment in Asean, especially Indonesia, and whether China can behave responsibly.
Since then The Jakarta Post has published a number of expert opinions on Indonesia and China relations, from the fear of China's rise as a regional hegemon to a balanced view on China, dispelling such a fear.
But less has been said about one question: why do Indonesia and Asean matter to China? What drives China to put billions of dollars in Indonesia following various multilateral and bilateral agreements at the Asean level and between Indonesia and China?
In 2016, China became the third largest investor in Indonesia after Japan and Singapore.
After the signing of the Indonesia China strategic partnership in 2005 and the upgrade into a comprehensive strategic partnership in 2013, China is now Indonesia's largest trading partner. What does it mean to be a strategic partner for China?
One should note that since the early 2000s, China has signed strategic partnership agreements with 47 countries and three international organisations in which Asean is one of them.
Feng Zhongping and Huang Jing (2014) argue that the boom of China's strategic partnerships is a result of China's embrace of globalisation and multi-dimensional diplomacy. It is a diplomatic instrument to secure China's core interests and its peaceful rise as a global power.
A comprehensive strategic partnership as articulated by the Chinese premier Wen Jiabao, in 2004, is an all-dimensional and multilayered, long-term and stable partnership that transcends differences in ideologies and social systems. It seeks to expand converging interests and seek common ground on the major issues while shelving differences on the minor ones. Along with Indonesia, other Asean members who have signed strategic partnerships with China are Vietnam, Cambodia, Laos, Myanmar, Thailand and Malaysia.
The strategic partnership is used by China as a diplomatic tool to protect its core interests, which include state sovereignty, national security, territorial integrity and national reunification. These core interests are reflected well in all documents of China's strategic partnerships.
The question then is, why do Indonesia and Asean more broadly deserve a position as China's strategic partner? I would strongly argue that it is to protect China's core interest, its national security. In this case, securing its energy supply. Energy security for China, as Downs wrote in 2006, means the acquisition of sufficient energy supplies to protect China's core objectives.
In recent years China has emerged as a global player in the energy sector. This is a result of soaring economic growth, hovered between nine and 10 per cent per year for three decades since 1980. And since 2012, China still shows impressive growth at a rate of seven to eight per cent. This is why China's demand for energy is massive and propels the country to undertake energy acquisitions worldwide. Domestic energy in China is scarce except in coal, but with low quality.
China became a net oil importer in 1993, a net gas importer in 2007, a net coal importer in 2008 and the first global oil importer in 2014. It means that in 2014, China has become a consumer of 30 per cent of global oil consumption and 45 per cent of global coal consumption. Given this enormous energy demand, China has no other option but to go overseas to secure energy supply.
Why is Asean strategic for China? It is because about 60 per cent of China's oil import is transported through the Strait of Malacca. A strategic partnership with Asean will help mitigate the risks of disruptions in China's energy transport from piracy, congested traffic, terrorist attacks and especially the naval forces of other major powers like the United States and Japan.
One way to mitigate the risk in the Strait of Malacca is the construction of the oil and gas pipeline from Maday Island in Myanmar to Yunan Province in China, which has been operational since 2015. It has cut by 30 per cent the time needed to transport crude oil to China and reduced the risk of piracy and other risks. Also, in November last year, China and Malaysia signed deals on defence.
The two parties also agreed to resolve the South China Sea case on a bilateral basis. This further secures China's energy interest in the Strait of Malacca and South China Sea.
Asean countries encompass all of China's energy shipping routes from the Middle East, Africa and Latin America. Therefore, it is in China's core interest to maintain peace and stability in the region and seek closer economic cooperation with Asean member countries including Indonesia.
When he came to power in 2014, President Joko 'Jokowi' Widodo projected Indonesia as a maritime power and this has become central in Indonesia-China relations since 2015. It sits well with China's Maritime Silk Road ambition.
Indonesia's diplomacy toward China can be further improved to mutually benefit the two parties when we understand why Indonesia and Asean matter to China.