SINGAPORE — As the third generation of Chinese leaders since 1949 hands power over to the fourth, Southeast Asia and the 10 members of the Association of Southeast Asian Nations are following the landmark political transition with keen interest. What does ASEAN expect from the transition?

ASEAN has fully recognized the rise of a “new” China already embodied in the 16th Party Congress of the Chinese Communist Party held in November. The increasing self-confidence of this new China, which is enhancing its international stature, can be attributed to three factors — China’s spectacular economic growth and development, the stabilization of domestic politics via an expected smooth political transition, and the stabilization of external relations.

Following an impressive growth rate of 8.2 percent and $52 billion of foreign investments in 2002, China is projected to grow by at least 7 percent this year. At the 16th Party Congress, President Jiang Zemin set a goal for China’s rapid modernization without social chaos: a quadrupling of gross domestic product by 2020 as China implements commitments to the World Trade Organization.

The 16th Party Congress has broken with its tumultuous ideological past, a political watershed for four reasons:

* China has moved from a political-ideological leadership to a more technocratic one and has “consecrated” the rise of a middle class over the strong proletariat and peasant base of 40 years ago.

* A new foundation for the party has been laid through Jiang’s “Three Represents” theory, a distinct shift from Marxist-Leninism.

* The concept of “class struggle” has been buried and that of “private property” enshrined, with stress placed on the primacy of the rule of law.

* “Capitalist entrepreneurs” have been accepted into the party.

Clearly contributing to growing Chinese self-confidence is the “normalization” of China’s external environment since U.S. President George W. Bush and Jiang met in Crawford, Texas, in November. Self-confidence has also been bolstered by the stabilization of relations with Russia, the North Atlantic Treaty Organization, Central Asia, India and ASEAN. External stability contributes to the internal stability needed for China to consolidate economic growth.

ASEAN countries are counting on China for smooth political, economic and social transitions as well as maintenance of regional stability from the Korean Peninsula to the South China Sea.

Internal social stability is probably the most crucial challenge for China, given multiple socioeconomic imbalances (between the rich and poor, urban and rural economies, and coastal and inner provinces) and rampant abuses of power (including administrative and judicial corruption and nepotism at all levels). ASEAN countries are mindful that chaos and havoc in China would rattle all of Asia.

ASEAN expects to view China as a source of economic opportunities. Until a year or two ago, it had been perceived as a threat. China’s growth engine provides trade opportunities in goods, services and tourism as well as investments and technology transfers to Southeast Asia.

For example, China has agreed in principle to a zero-tariff regime with Thailand for two-way trade of fruits and vegetables. The Philippines, meanwhile, is aggressively wooing Chinese tourists. China National Offshore Oil Corporation (CNOOC) has acquired oil interests in Indonesia. And Singapore is developing an education market catering to an increasing number of Chinese students.

A smooth political transition in China will guarantee ASEAN continuous economic opportunities, especially as negotiations get under way for an ASEAN-China free-trade area.

ASEAN thus has keenly followed China’s political transition because it will have a huge impact on the stability and development of the entire East Asian region. ASEAN-China relations, now based on three pillars (recognition, stability and opportunity), have developed to the extent that China is playing an ever-larger role in Southeast Asia. Japan must realistically contend with this change as it formulates policies on trade, investments and external relations toward ASEAN, especially within the framework of the “Japan-ASEAN Exchange Year 2003.”

ASEAN’s continuous growth, development and stability are increasingly linked to those of China and Japan. In fact, it is now expected that China will eventually co-lead, with Japan, the current “ASEAN plus Three (China, Japan and South Korea)” process involving East Asian regionalism and integration.

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