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FM AMEMBASSY BEIJING
TO RUEHC/SECSTATE WASHDC IMMEDIATE 0415
INFO RUEHOO/CHINA POSTS COLLECTIVE
RUEHBY/AMEMBASSY CANBERRA 9509
RUEHKO/AMEMBASSY TOKYO 1508
RUEKJCS/SECDEF WASHINGTON DC
RHEHNSC/NSC WASHDC

C O N F I D E N T I A L SECTION 01 OF 04 BEIJING 005064 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: DECL: 08/02/2032 
TAGS: PREL PGOV ECON SENV PHUM CH JP AS KS KN
SUBJECT: AMBASSADOR DISCUSSES REGIONAL ISSUES WITH 
AUSTRALIAN AND JAPANESE COUNTERPARTS 
 
 
Classified By: Ambassador Clark T. Randt, Jr. 
Reasons 1.4 (b) and (d). 
 
Summary 
------- 
 
¶1. (C) Canberra wants to be "in the loop" regarding 
discussions of a Northeast Asia Peace and Security 
Mechanism (NEAPSM), given that Australia is likely to 
be drawn into any conflict in the region, Australian 
Ambassador to China Geoff Raby told Ambassador Randt 
and Japanese Ambassador Yuji Miyamoto August 2. 
Ambassador Raby noted Chinese concerns about 
quadrilateral talks among Australia, India, Japan and 
the United States, but Ambassador Miyamoto thought 
such questions were "normal" and not a problem, given 
that China is involved in its own groupings like the 
Shanghai Cooperation Organization (SCO).  Chinese FM 
Yang Jiechi discussed the "fragile and dangerous" 
cross-Strait situation with Japanese FM Taro Aso in 
Manila, Miyamoto said.  Beijing seems "genuinely 
worried" about the current cross-Strait situation, 
Ambassador Raby noted.  Japan is willing to discuss 
all issues in normalization talks with the DPRK, 
including compensation, but North Korea must agree to 
solve the abductions problem, Miyamoto said.  While 
expressing concern about Chinese military intentions, 
Miyamoto stressed that these worries should not affect 
political and economic relations with China.  The 
Australian Defense Minister had a "convivial" visit to 
China but "learned nothing," Raby lamented.  Climate 
change will be an important topic on the APEC agenda, 
with Australia hoping for Chinese support given 
Beijing's interest in dealing with environmental 
issues as a way to ensure domestic stability. 
Miyamoto was pessimistic about China's ability to deal 
with mounting domestic problems.  The August 30 
Australia-China human rights dialogue was productive, 
Raby said, noting that in recent years China has 
shifted from denying problems to providing 
explanations for why problems exist.  Foreign Minister 
Taro Aso is likely to be promoted to an "important new 
job" if Prime Minister Abe reshuffles his cabinet, 
Miyamoto said.  End Summary. 
 
Northeast Asia Peace and Security Mechanism 
------------------------------------------- 
 
¶2. (C) Canberra is paying close attention to 
discussions on a Northeast Asia Peace and Security 
Mechanism (NEAPSM) as part of the Six-Party Talks and 
wants to be "kept in the loop," Australian Ambassador 
Geoff Raby told Ambassador Randt and Japanese 
Ambassador Yuji Miyamoto at an August 2 lunch at the 
Australian Embassy.  Ambassador Raby said Australia's 
"working hypothesis" is that it would be drawn into 
any conflict in Northeast Asia, given its security 
alliance with the United States, as well as with 
Japan, not to mention its huge economic and trade 
interests in the region.  Australia therefore has 
asked China to include it at an "early date" in NEAPSM 
discussions.  Canberra's Ambassadors in Washington and 
Tokyo will make similar requests soon, and Foreign 
Minister Downer plans to make NEAPSM a "big issue" 
during bilateral meetings on the margins of APEC. 
Ambassador Raby said his "personal opinion" was that 
the region needs some sort of security mechanism that 
does not have ASEAN at the center.  He said Chinese 
counterparts have told him that they are supportive of 
a regional security mechanism, but they hope that 
ASEAN will continue to play a central role in it. 
 
¶3. (C) Ambassador Miyamoto urged caution on NEAPSM, 
noting that in light of current regional 
"uncertainties," Tokyo's primary concern is how any 
multilateral mechanism would affect current alliances. 
The "lessons of history" demonstrate that the 
scrapping of the UK-Japan bilateral alliance for the 
Washington Treaty system prior to WWII was the 
"beginning of Japan's downfall," Miyamoto stated, 
emphasizing that no one wants a repeat of that "pre- 
War drama."  Ambassador Randt assured Miyamoto that 
Washington's intention regarding the NEAPSM is to 
complement, not replace, our existing alliance 
relationships.  Despite Japanese reservations, 
Ambassador Miyamoto said his "personal view" is that a 
multilateral mechanism is the "only way" to deal with 
China's growing power.  In light of China's strength 
 
BEIJING 00005064  002 OF 004 
 
 
and stunning economic growth, if the PRC were to 
become a threat in the future, the power of just one 
country, even that of the United States, would be 
insufficient as a counterbalance.  The only way to 
influence China and ensure regional security, 
therefore, is to create some sort of multilateral 
body. 
 
PRC Concerns over Quad, Australia-Japan Defense Ties 
--------------------------------------------- ------- 
 
¶4. (C) Ambassador Raby asked about the PRC reaction to 
quadrilateral talks among Australia, India, Japan and 
the United States, noting that the Chinese often raise 
the subject with him.  Ambassador Randt replied that 
MFA counterparts routinely raise the Quad discussions 
and inquire as to the intentions of the talks. 
Ambassador Miyamoto thought China's questions about 
the Quad were "normal" and not a cause for concern. 
China pursues its own interests by participating in 
groups such as the Shanghai Cooperation Organization 
(SCO), in part to offset U.S. influence in Central 
Asia.  Beijing did not consult with anyone before 
developing relations with African countries, which it 
knew would impact others.  Although we should be 
careful not to pursue confrontation with China, 
Miyamoto said groupings such as the Quad were 
"necessary" for dealing with Beijing.  Chinese 
apprehension about the Quad came up often during the 
recent visit of the Australian Defense Minister, Raby 
said.  Turning to the new Australia-Japan security 
mechanism, Ambassador Raby said the Chinese Government 
has yet to raise it with him, although PRC think tanks 
often bring it up.  Ambassador Miyamoto said the 
Chinese have not discussed the subject with him. 
 
Taiwan 
------ 
 
¶5. (C) Chinese Foreign Minister Yang Jiechi "for the 
first time" raised Taiwan with Japanese FM Taro Aso in 
Manila, Ambassador Miyamoto said.  Previously, Beijing 
did not seem overly concerned with Japan's position on 
Taiwan.  In Manila, however, FM Yang lectured Aso at 
length about the "fragile and dangerous" cross-Strait 
situation.  The Chinese frequently lecture Australia 
on Taiwan, Ambassador Raby said, observing that 
Beijing seems "genuinely worried" about the current 
situation.  Beijing has also been "in overdrive" in 
stating concerns about Taiwan's status at the upcoming 
APEC meetings.  Ambassador Miyamoto said China had 
"learned a lesson" from previous Taiwan crises and has 
been careful this time in its public comments on 
Taiwan.  Miyamoto nevertheless acknowledged that 
domestic pressure within China could push Beijing 
toward taking a more aggressive stance. 
 
North Korea, Six-Party Talks, Japanese Abductees 
--------------------------------------------- --- 
 
¶6. (C) Even though all parties were on their "best 
behavior" at the last round of Six-Party Talks, 
especially the North Koreans, a great deal of 
difficult work on core issues remains unresolved, 
Ambassador Miyamoto commented.  Pyongyang is sure to 
raise new subjects and "play tricks" at some point, 
including by bringing up light-water reactors as a 
"bargaining chip," Miyamoto said.  Nevertheless, 
during the talks the Japanese and DPRK delegations 
held an "amicable" meeting to discuss normalization, 
in contrast to the first normalization working group 
meeting, when Pyongyang refused to even discuss 
abductees.  Abductions will remain an important issue 
for Japan, even if there is a change in government in 
Tokyo.  Japan is willing to "put everything on the 
table" and discuss all issues as part of a "package 
deal," including compensation, but North Korea must 
agree to solve the abductions problem, Miyamoto 
averred. 
 
¶7. (C) Ambassador Raby, who will travel to Pyongyang 
next Tuesday to present his credentials to the DPRK 
Government, to which he will be concurrently 
accredited, agreed at Miyamoto's request to raise the 
abductees issue while in Pyongyang.  Raby said Chinese 
Vice Foreign Minister Wu Dawei had encouraged him to 
request a meeting with Kim Jong-Il, but Canberra has 
been reluctant to do so, meaning that he will most 
 
BEIJING 00005064  003 OF 004 
 
 
likely be received in Pyongyang by the DPRK's new 
Foreign Minister or North Korea's "nominal" President. 
 
Chinese Military Transparency 
----------------------------- 
 
¶8. (C) Ambassador Miyamoto expressed concern about the 
Chinese military's intentions but stressed that these 
worries should not affect political and economic 
relations with China.  We must engage China.  The PLA 
has long argued for increased capabilities in order to 
prevent Taiwan independence.  It is unclear whether 
behind that concern over Taiwan there also exists any 
"big power chauvinism."  It would be unfortunate if 
that were so, but we must be prepared for that 
possibility, Miyamoto stated.  Increased PLA 
transparency would be a good first step toward 
allaying our concerns.  While it is understandable 
that China's expanding interests justify enhanced 
military capabilities, those capabilities can always 
be used for other purposes, which is precisely why 
Japan's alliance with the United States is so 
important, Miyamoto said.  Ambassador Raby seconded 
this view, stating that is precisely why Canberra's 
alliance with Washington is so important. 
 
¶9. (C) Australia has also been pushing the PLA to 
increase transparency, Ambassador Raby said.  The 
Australian Defense Minister had a "convivial" visit 
with Chinese counterparts during his recent visit to 
Beijing but in the end learned "nothing," Raby 
lamented.  There have been some positive developments 
in relations with the PLA, Ambassador Miyamoto noted, 
explaining that the Chinese Defense Minister will 
visit Japan in September, the first time in nine 
years.  A number of Chinese naval vessels have visited 
Japan this year.  A Chinese naval ship will make a 
port call in Australia on September 7, which 
Ambassador Raby thought was the first-ever PLA ship 
visit to Australia. 
 
APEC, China's Domestic Challenges 
--------------------------------- 
 
¶10. (C) Climate change will be an important topic on 
the upcoming APEC agenda, Ambassador Raby stated, 
commenting that China itself has discovered that 
issues like climate change, energy and the environment 
are important for China's domestic stability. 
Australia hopes to "bump up" the level of aspirational 
statements on climate change at APEC, laying out 
specific energy efficiency objectives, albeit non- 
binding ones.  China itself has energy efficiency 
goals in its five-year plan.  Ambassador Miyamoto 
observed that China, for its own domestic and 
international reasons, is serious about pursuing 
climate change and energy efficiency goals but will 
likely agree only to relative, not absolute, 
reductions in emissions, because it simply is not 
willing to sacrifice economic growth. 
 
¶11. (C) Miyamoto thought the magnitude of China's 
domestic challenges is increasing and was pessimistic 
about the Communist Party's ability to deal with these 
problems.  He agreed with Raby that one of China's 
most pressing problems is trying to coordinate among 
competing interests within the Party.  China also 
faces a number of economic problems caused by its 
reluctance to liberalize its exchange rate and 
financial systems.  Beijing should rely more on market 
forces, fewer regulations and the rule of law, but is 
afraid to do so.  Even if implementing exchange rate 
reform would not solve China's trade surplus with the 
United States, China must do so for its own 
development, Raby said.  The same holds true for the 
price of natural resources, which Australia thinks 
should increase by 50 percent.  Only then would 
inefficient polluters be driven out of business.  The 
government, meanwhile, continues to rely on regulation 
and government intervention.  One cause for optimism, 
however, is the unification of China's domestic 
market, Miyamoto observed, due to massive 
infrastructure development fueled by economic growth, 
resulting in increased productivity. 
 
Human Rights: PRC-Australia Dialogue 
------------------------------------ 
 
 
BEIJING 00005064  004 OF 004 
 
 
¶12. (C) The August 30 round of the Australia-China 
human rights dialogue was "productive," Ambassador 
Raby said.  AFM He Yafei led the PRC delegation this 
time, with Australia successfully resisting Chinese 
attempts to downgrade the talks to the DG level.  Only 
on the issue of the Dalai Lama was He Yafei "sharp and 
aggressive," Raby said.  Australia handed over a list 
of cases of concern.  A number of high-level, non-MFA 
representatives attended for the Chinese side, which 
Raby surmised was part of MFA's strategy to expose 
other PRC agencies to the thinking of foreigners on 
human rights.  The tone of the dialogue has improved 
over the last 11 years, Ambassador Raby stated, 
commenting that at first both sides simply "shouted" 
at each other, but in the last few years the Chinese 
side has stopped denying problems and instead now 
provides explanations for why the problems exist. 
Australia has implemented a one-to-two-million-dollar 
technical assistance program to bring Australian 
judges to China to teach about the rights of the 
accused.  At the last dialogue, the main topic was the 
rights of HIV/AIDS sufferers.  This time it was 
lawyers who defend the rights of individuals.  Raby 
said China knows where it wants to go on human rights 
but appears not to know how to get there under a one- 
Party system. 
 
FM Aso up for Promotion? 
------------------------ 
 
¶13. (C) In the wake of the LDP's Diet Upper House 
election defeat, Prime Minister Abe could reshuffle 
his abinet "at any time," Miyamoto said.  If so, 
Foreign Minister Aso would likely be promoted to an 
"important new job."  If this were to happen, Miyamoto 
lamented that Japan would need some time to get a new, 
and likely inexperienced, foreign minister "up to 
speed." 
RANDT