VZCZCXRO0377
OO RUEHCN RUEHGH
DE RUEHBJ #0359/01 0411045
ZNY CCCCC ZZH
O 101045Z FEB 10
FM AMEMBASSY BEIJING
TO RUEHC/SECSTATE WASHDC IMMEDIATE 8073
INFO RUEHOO/CHINA POSTS COLLECTIVE IMMEDIATE
RUEHBUL/AMEMBASSY KABUL IMMEDIATE 0731
RHMFISS/CDR USPACOM HONOLULU HI IMMEDIATE
RUEKJCS/SECDEF WASHINGTON DC IMMEDIATE
RHEHNSC/NSC WASHDC IMMEDIATE
RUEAIIA/CIA WASHINGTON DC IMMEDIATE

C O N F I D E N T I A L SECTION 01 OF 02 BEIJING 000359 
 
SIPDIS 
 
E.O. 12958: DECL: 02/10/2030 
TAGS: PREL PGOV MASS ECON ETRD CH TW IR AF KN
SUBJECT: MAINTAINING POSITIVE U.S.-PRC RELATIONS 
IMPERATIVE, DESPITE TENSIONS, SAYS PRC SCHOLAR 
 
REF: A. BEIJING 311 AND PREVIOUS 
     ¶B. BEIJING 355 
 
Classified By: POL Minister Counselor Aubrey Carlson.  Reasons 1.4 (b) 
and (d). 
 
¶1. (C) Summary:  A Chinese public perception that U.S. China 
policy under President Obama would be "different" than that 
of his predecessors and that recent warming in cross-Strait 
relations made arms sales unnecessary fueled many Chinese' 
vitriolic response to the latest Taiwan arms sales, according 
to a scholar from a PLA-affiliated think-tank.  Despite the 
uptick in bilateral disagreements, our contact stated, 
maintaining stable U.S.-PRC ties is an imperative.  Media 
narratives suggesting new PRC assertiveness on the global 
stage overstate PRC abilities, despite recent statements from 
the Foreign Minister that suggest PRC willingness to flex its 
foreign policy muscle.  Formidable challenges facing China's 
domestic economy and society should keep PRC leadership 
focused inward, our contact said, limiting the possibility of 
PRC aggressiveness on the international stage.  End summary. 
 
¶2. (C) PLA-affiliated China Foundation for International 
Strategic Studies (CFISS) scholar Zhang Tuosheng February 9 
reiterated to PolOff the standard PRC position on Taiwan arms 
sales, stating that the PRC considered such sales an 
interference in its internal affairs and that they violated 
the April 17, 1982 communique on arms sales to Taiwan.  Given 
consistent U.S. implementation of the Taiwan Relations Act, 
the PRC did not expect arms sales to cease in the near or 
mid-term.  The PRC general public, however, did not share 
this perception, Zhang averred. 
 
¶3. (C) Zhang stated that the vociferous response to the 
latest arms sales announcement stemmed from PRC public 
disappointment with President Obama's China policy.  In 
addition, given the recent improvements in cross-Strait 
relations, the general population felt Taiwan arms sales 
unnecessary.  The resultant public outcry put strong pressure 
on the government, Zhang said, although he did not expect 
threats of economic sanctions to materialize. 
 
Mil-Mil Always Suffers: Time to Break the Chain 
--------------------------------------------- -- 
 
¶4. (C) Lamenting that "military-to-military relations are the 
victim every time" an arms sales to Taiwan occurred, Zhang 
argued that "new thinking" was necessary to break the 
"vicious circle" of arms sales and PRC retaliation. 
Recalling then-PRC President Jiang Zemin's suggestion in 2002 
to then-President George W. Bush to link PLA missile 
deployment and Taiwan arm sales, Zhang suggested that both 
sides should reach "tacit agreement" whereby PLA withdrawal 
of missiles targeting Taiwan would be matched by U.S. 
reduction in arms sales.  This suggestion had provoked little 
response during his recent track II discussions in the United 
States, he noted. 
 
¶5. (C) Zhang said he had noted, too, in these recent 
discussions that U.S. interlocutors had not pointed to a need 
for cross-Strait "balance of power" in their justifications 
for the Taiwan arms sales.  Instead, they had emphasized that 
the arms sales helped strengthen Taiwan against possible PRC 
coercion.  Zhang said he saw that as a shift in argument and 
concluded sales were now "political gestures" rather than 
strategic security measures.  In that context, he reiterated 
the PRC long-standing request that U.S. sell Blackhawk 
helicopter spare parts to the PRC, saying such a move would 
help ameliorate bilateral tensions over the arms sales to 
Taiwan. 
 
Effects on Regional Cooperation 
------------------------------- 
 
¶6. (C) Zhang said he believed that PRC cooperation with the 
United States on regional issues would not be significantly 
affected by the latest arms sale announcement.  He suggested, 
for example, that PRC efforts toward a nuclear weapons-free 
Korean peninsula would remain on track because a North Korea 
with nuclear weapons would be "a disaster" for the PRC.  On 
Iran (see ref B for more on Iran), the latest arms sales 
might cause the PRC to "respond more slowly" on U.S. and 
European initiatives to pressure Iran but the PRC would 
eventually support additional UN sanctions because regional 
instability concerns took precedence in PRC calculations over 
any PRC-Iran bilateral damage that might occur as a result of 
 
BEIJING 00000359  002 OF 002 
 
 
sanctions. 
 
¶7. (C) The PRC would likely offer "no help" on Afghanistan, 
Zhang said, less because of Taiwan arms sales, but mainly 
because the PRC remained fearful of provoking Al Qaeda and 
the Taliban into actively assisting separatists in China's 
western Xinjiang region in response to high-profile PRC 
assistance to the United States and ISAF efforts in 
Afghanistan.  That said, he suggested, the latest Taiwan arms 
sales might temporarily quiet ongoing discussion within 
leadership and scholarly circles on whether the PRC should 
increase involvement in Afghanistan. 
 
Good Relations with the U.S. Still the Priority 
--------------------------------------------- -- 
 
¶8. (C) While noting the unfortunate timing of the arms sales 
announcement, a likely Presidential meeting with the Dalai 
Lama, the Google dispute, and trade frictions, Zhang said 
CFISS had recently submitted a report to the PRC leadership 
that included the following key points:  1) Maintaining a 
stable U.S.-PRC relationship is imperative; 2) Current 
problems are "old issues" not new, and should not be linked 
together; 3) The PRC must exercise "risk management" in the 
bilateral relationship; and 4) The PRC must pursue both 
"opportunity" and crisis management. 
 
PRC Assertiveness Narrative Overstates Case 
------------------------------------------- 
 
¶9. (C) Asked about prominent stories that the PRC had 
increased its assertiveness in foreign policy, Zhang 
distinguished between economic, non-traditional and strategic 
security fields, suggesting that China's relative economic 
strength in recovering from the global financial crisis had 
engendered a sense in the PRC leadership that China should 
have "a big voice" on reforming international financial 
institutions.  The PRC also hoped to play a positive role on 
non-traditional security issues, such as climate change. 
While acknowledging greater PLA participation in anti-piracy 
efforts and UN peacekeeping activities, Zhang pointed out 
that PRC capacity on security issues remained "limited." 
 
¶10. (C) Zhang suggested that the PRC should not be "too 
assertive" on foreign policy issues and disagreed with both 
Western and Chinese media commentary trumpeting the PRC's 
"stronger position" in the international community. 
Referencing the goals for a "harmonious society" addressing 
economic and environmental issues that had been laid out 
during the 2007 17th Party Congress, Zhang commented that the 
PRC "has a long way to go."  He cited speeches by President 
Hu Jintao February 3 to the Central Party School and by Vice 
Premier Li Keqiang January 28 at the World Economic Forum in 
Davos, Switzerland, that had underscored the imperative of 
continued economic reform and international cooperation.  He 
explained that "consumption" had traditionally been the 
weakest of the three pillars of the PRC economy, compared to 
trade and investment pillars, and that the "Second Reform," 
as scholars  called Hu's economic plan, aimed to address this 
disparity.  Zhang pointed out that "government officials" and 
State-Owned Enterprise resistance to changing the PRC 
economic growth paradigm could undermine the success of the 
economic restructuring. 
 
¶11. (C) Zhang noted FM Yang Jiechi's recent remarks in Europe 
that said the PRC was both a developing country and a 
developed country.  Zhang commented that while the remarks 
were accurate, FM Yang should have emphasized that "the PRC 
is still a developing country."  Despite the PRC's economic 
might, the PRC "should not be proud" of its polluting heavy 
industries, its growing rich-poor and coast-interior income 
gaps, the lack of rule of law, and endemic corruption.  Faced 
with these many difficult challenges, he concluded, "China 
cannot be assertive." 
HUNTSMAN