In Singapore, we recently gathered thought leaders from Southeast Asia, China and the United States. The meeting’s purposes were to understand how the intensifying US-China strategic friction is affecting the region, and to suggest ways to put developments on a more positive trajectory. The US and China are in what Henry Kissinger recently called “ the foothills ” of a cold war. Grey-zone conflict – coercion exerted by means just short of undeniable military force – is mounting in Southeast and East Asia. The prospects for accidents or miscalculation grow. Moreover, the deteriorating US-China security relationship is spilling over into their economic and cultural ties, with increasing ramifications for regional neighbours and beyond. While the recent US-China phase-one trade deal is broadly welcome, it leaves many issues unresolved , and Southeast Asians and others worry that the two powers will sleepwalk into progressively greater conflict. They fear being pressured into taking sides. Southeast Asia accepts that the US and China have a competitive relationship and that there is no prospect of quickly reversing this circumstance. But these nations look ominously to the horizon where they see a tech war looming, and they see themselves as increasingly likely to be drawn into economic struggles and possibly military conflict. They wish to avoid these escalations at all costs. They believe that if Sino-American ties stabilise, they will be able to use their well-honed navigational skills to survive in the space between the two powers. So they want Beijing and Washington to develop a modus vivendi, even if warmth is unachievable. Given these understandings, fears and realities, what can be done to stabilise Sino-American ties for their benefit and for East and Southeast Asia, and the wider international system? Several ideas arose in the course of our discussions. To start, both Beijing and Washington need to publicly, mutually and unambiguously accept that the other is a regional power and is there to stay. Just as an “anti-hegemony clause” was important to the Nixon-Mao Shanghai Communiqué of 1972 (although then, “anti-hegemony” referred principally to Soviet ambitions), so today, Beijing and Washington need to agree that their objective is not regional dominance or exclusion of one another from East and/or Southeast Asia. Whether such an agreement takes the form of what one might call a “fourth communiqué” between Washington and Beijing is less important than that the declaration is formal and prominently adopted. Second, there needs to be agreed “rules of the road” governing various aspects of regional big power competition (particularly military). An important line of thinking at the conference concerned maritime behaviour in East and Southeast Asia. One promising approach would be for Beijing to agree to affirm the United Nations’ Law of the Sea principle that exclusive economic zones are not intended to regulate surface maritime transit (thereby reassuring the US and others) and that, in turn, Washington would dramatically reduce its “ close-in surveillance ” along China’s coast (thereby, reassuring Beijing). Another area of needed Sino-American interaction is at the strategic level. Space, cyber and conventional weapons races are accelerating, with the growing challenge of short- and intermediate-range missiles in Asia being of signal importance. Understandings and constraints need to be developed concerning short- and medium-range missile deployments by the two powers in East and Southeast Asia. We have seen how allergic China is to US missiles (of any sort) on the Korean peninsula, as we have seen how concerned Washington is about Beijing’s capacities to hit US bases, facilities and assets in East and Southeast Asia, and to military emplacements on land features in the South China Sea. Ever more missiles in the region create an increasingly sensitive hair trigger on conflict. More broadly, Sino-American arms control discussions and strategic dialogues are desperately needed. US warship ‘sailed close to’ Chinese-occupied reefs in South China Sea Fourth, in the economic domain, Japan’s initiative in moving ahead with the Comprehensive and Progressive Agreement for a Trans-Pacific Partnership (CPTPP) has created incentives for both China and the US to join that effort. Though there is little prospect that current US domestic politics will permit such a move on Washington’s part, this should be a high priority if the general election this year produces a more permissive environment. More feasible in the short term would be Washington and Beijing moving ahead with the nearly complete bilateral investment treaty . A great facilitator of positive movement in bilateral economic relations would be a Sino-American agreement that “reciprocity” is a core principle in bilateral economic and other relations. The economic stability resulting from these moves would greatly benefit Southeast and East Asia. Another specific area of productive economic interaction concerns infrastructure building in Southeast Asia. In 2010, the Association of Southeast Asian Nations (Asean) adopted a “ connectivity plan ”. This is an area where both the US and China could contribute to regional goals through parallel and sometimes joint endeavours. There is no need for Beijing or Washington to demonise or impede the efforts of the other when it comes to infrastructure in Asia. There are plenty of opportunities for either cooperation or parallel and reinforcing action, and there is a big potential role for the US private sector. Why the trade war need not shatter hopes for an Asian century Finally, in the zone of civic society, identifying opportunities for Chinese and American NGOs to cooperate (perhaps in joint projects) in third areas is potentially fruitful. Such cooperation would be most feasible with respect to developmental assistance projects, education, health and humanitarian emergencies in Southeast Asia and perhaps Central Asia. If steps such as those sketched out above seem “unrealistic” in today’s environment, it is worth recalling that Mao Zedong, Richard Nixon, Deng Xiaoping, and Jimmy Carter changed the entire strategic chessboard by developing a Sino-American vision that virtually no one in either the US or China anticipated. Their bold visions brought the region and the wider world nearly five decades of peace. David M. Lampton and Wang Jisi are co-advisers to the Pacific Community Initiative conducted by Johns Hopkins-SAIS and Peking University with support from the China-US Exchange Foundation. Lampton is professor emeritus at Johns Hopkins University and Oksenberg-Rohlen Fellow at Stanford University’s Asia-Pacific Research Centre. Wang is president of the Institute of International and Strategic Studies at Peking University Purchase the China AI Report 2020 brought to you by SCMP Research and enjoy a 20% discount (original price US$400). 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