 I want to welcome everyone, my name is Chris Johnson, I'm the Freeman Chair in China Studies here at CSIS. And we are extraordinarily honored to be having this session today for the launch of Kevin Rudd's US-China 21, the future of US-China relations under Xi Jinping. And just give a few opening remarks and we'll get right down to it. Kevin will be introduced by General Brent Scowcroft, who is, of course, a counselor and trustee here at CSIS, and president of the Scowcroft Group, an international business consulting firm. He also, of course, was the national security advisor to President Ford and George H.W. Bush, among many other senior positions in government and we're most pleased to have him here today. And I am particularly honored to have been asked by Kevin to be the host of this event. I learned just a tremendous great deal from Kevin over the years. The only thing I worry about is when he comes to CSIS and sees my boss, Dr. Hamre, and these long China discussions that we have is that the next day my desk will be cleared out and Kevin will be coming in to take over. So he really is an unrivaled statesman and analyst of things China and, frankly, in a sea of sort of tired balance of power analysis and what I consider to be sort of a slip shot, collapsed analysis that we've been seeing over the last several weeks. I think it's so, so helpful to have such a serious analytic product that Kevin has delivered for us. So without further ado, I'm going to ask General Scowcroft to come to the podium. Thank you. Very much. It's a great pleasure. Kevin, twice Prime Minister of Australia distinguished enough, but he's following this. Oh, it helps to have it on, doesn't it? But he's following this distinguished political career with an equally distinguished career in the think tank world, including here. Let me read you. He is now senior fellow at the Harvard Kennedy School, President of the Asia Society Policy Institute, and distinguished statesman at CSIS. That's while he settles down to decide what he really wants to do. He recently had what custom says is a rather significant birthday, which is much better than the alternative. Some friends were kind enough to surprise me with a gathering over dinner, and they treated me with some generous reflections about our work together. I let this go on for a while. I enjoyed it. But then told him an obvious truth. If my career has successes, it's because I sought the advice of wise people and made use of it as extensively as I could. Among the people I have, my career turned to advice, and especially on China, has been Kevin Rudd. Maybe I value his thoughts because his view of the most complex bilateral relationship in the world comports so well with my own thinking. Kevin, you may not want this title, but you're a notable realist now. And that may not be a compliment in Washington today. But I suspect there's more to my regard for Kevin's judgment than our similarity of views. When he talks to Americans about Asia, he has the advantage of the perspective that Australians enjoy from down under. Australians have fought with us in every war of the 20th and 21st century. We do well to listen to people who have purchased our attention at so high a price. Australians understand our interests in Asia, but they bring their own experience of the region to the judgment they make, which is a very useful delineation from our own. And Kevin's personal experience in China is broad and deep. It's hard to say, but it's hard to imagine, two nations with greater differences in their history, culture, and politics than the United States and China. Kevin brings his conversations with the American and Chinese leaders and unromantic clear-eyed analysis of the issues they unite and divide us. He delivers his message with clarity and humility and manages to talk to both sides in their own language, which is no mean feat. I urge you all to pay close attention to what Kevin has to say. Americans have no better friend in Asia than Kevin, and that's because he tells both us and the Chinese the hard truth. Kevin, we welcome your latest work and are honored to have you share your insights today. Thank you. Well, it's great to be back in Washington. Great to be back here at CSIS. And it's good to be here for the launch of my summary of a report on U.S.-China relations under Xi Jinping. And thank you, Chris, for your kind words of welcome here to the John-Hammary Taj Mahal. I think it's got the same color of stone on the outside as the Great Building, which the Moogles left us, so it's great to be here with you. And I'm also honored to have been introduced as well in so warmer fashion by former National Security Advisor Brent Scowcroft, as chairman of today's proceedings. Shall I have this on or off? How's that? Can you still hear me? You can't. So I'll put it back on. Brent is not only a distinguished American public servant, he is also respected around the world. And that includes China, where he is acted as personal envoy for so many American presidents over so many years during the ups and downs of the US China relationship. And Brent, as you've just told us, you've just celebrated a 90th birthday, and you continue to serve your country today. His counsel continues to be sought by political leaders around the world, including myself during my own period as Prime Minister of Australia. Born in 1925, Brent was therefore born in the 14th year of the Chinese Republic, the fourth year of the Chinese Communist Party, and 24 years before the founding of the People's Republic, which makes you, my friend, a continuing and venerable institution. Brent, you have my friends seen a lot, you've met a lot, you've read a lot, and you've thought a lot. And I, for one, thank you for one simple thing, and that is your wisdom. In a world of rapidly compounding change, it is good to have the benefit of continuity born of a lifetime of experience. My purpose today is to speak to the report, which I've been laboring this last year on at the Belfer Center at the Harvard Kennedy School, a formidable public policy institution, carefully nurtured under Professor Graham Allison, who I'm delighted to have with us here today in Washington, D.C. And thank you, Graham, for your support in the last 12 months up there in the People's Republic of Cambridge. Which I was told recently was part of the United States of America. My core argument for the future of the US-China relationship is pretty simple. Point one, despite recent fashionable commentary about China's impending economic and political implosion, this conclusion is not sustainable against the evidence. Point two, for the US to hold such a view would be a foolhardy basis for policy. Point three, Xi Jinping is a radically different leader than his predecessors. And while his core priority will remain the economy, which he understands to be the cornerstone of Chinese economic power, he will also increasingly deploy China's growing economic power to secure greater Chinese foreign and security policy influence, particularly in the region. Number four, absent any agreed strategic narrative between them, that is between the United States and China, the level of strategic trust between the US and China will continue to erode over time because of deeply held internal views about each other's long-term strategic intentions towards each other. And five, that if this trend is to be arrested, the time has come for a de minima common strategic narrative and common strategic framework capable of managing what I described as the fundamental realist disagreements between them, while at the same time maximizing what I call the constructive problem solving between them in difficult but not insuperable challenges in their bilateral, regional, and global relationship. And through this build political and diplomatic ballast and capital over time, to deal with the new challenges of the relationship which will present themselves inevitably in the future, and in time, in time, perhaps resolve old challenges from the past too difficult to resolve right here in the present. I call this for one bit of expression, constructive realism, common purpose. Or in Chinese, it has the advantage, I think, my Chinese friends can confirm this or dispute it, of being passable in translation in both countries and in both languages. My remarks today, I will draw extensively and directly from the summary report. So for those of you who have actually read the report, I apologize in advance for some repetition. Both Chinese and American foreign and security policy practitioners pride themselves on their hard-nosed realism. In the case of the Chinese, inspiration is drawn from the writings of Sun Zhe, the Bingfa, the art of war, and the other authors of the so-called Seven Military Classics, the Wu Jingqi Shuo. For Americans, it's a cocktail of one class of it, C.H. Kahn, Hans Morgenthau, and the rest. There is no great Chinese philosophical school to draw upon that is remotely the equivalent of either the idealists or the liberal internationalists in the Western theory of international relations. For these reasons, for any strategic framework to be regarded as credible in either Chinese or American eyes, despite their radically different historical experience, a realist recognition of the fundamentally different and in some cases, actively conflicting national interests is essential. The list of such contested areas in the U.S.-China relations is long, but not necessarily insurmountable in the long term. A healthy exercise to be conducted between Beijing and Washington would be to clarify the contents of such a list in order to first agree on exactly what they fundamentally disagree on. The list that I provide just here is therefore for indicative purposes only, but it might include Taiwan, including future American arms sales to the island. Two, conflicting claims between China and Japan in the East China Sea. Three, conflicting claims between China and other claimant states in the South China Sea. Number four, the retention of U.S. military alliances in bases in Asia. Number five, China's military modernization and the two countries' mutual surveillance of each other's capabilities, sometimes in closer proximity to one country than the other. Further, acceptance of the legitimacy of the Chinese political system as a matter for the Chinese people to resolve, or is it in fact proper to hold its subject to the evaluations of global normative standards of human rights democracy and the rule of law. And furthermore, the management of bilateral, non-governmental organization-based and UN multilateral disagreements on human rights, basic freedoms, including internet regulation. These issues should not be seen as no-go areas in the relationship. Rather, they should be clearly acknowledged. Clearly acknowledged as major difficulties, but they should not be allowed to derail the entire relationship in one fell swoop. Even dire circumstances, such as a major crisis, would warrant direct communication between the two presidents to explain to one another why it is necessary to imperil the entire relationship over one fundamental breakdown. These choke points in the relationship, the US-China relationship, as difficult as they are, can however be managed through a common strategic framework and with common political will. However, these deep realist elements of the relationship should be matched equally, and I believe more so, by constructive engagement between the US and China in difficult areas of the bilateral, regional, and global relationship where substantive progress is indeed possible. Otherwise, there is a danger that an alloyed strategic realism can suffocate a relationship altogether. Or worse, given the generally bleak assumptions about each other's ultimate strategic intentions, there is the perennial risk of hyperrealism becoming a form of self-fulfilling prophecy, resulting in crisis, conflict, or even war. So what are the constructive elements that can help leaven the realist loaf in this particular relationship? Bilaterally, there are a number, and we're familiar with those, and they are outlined in my report, ranging from the bilateral investment treaty to rules of the road on cyber. Each of them hard, each of them difficult, but both of them, and the rest of them too, doable if there is political will. What about constructive realism in the region? Again, we can point to an agenda ranging from the development of a comprehensive set of protocols between the region's militaries on managing and avoiding incidents of sea and in the air, given that Asia at large is becoming the global arms bizarre. And furthermore, to the extent of the elaboration over time of the contours of perhaps a grand strategic bargain on the Korean Peninsula against the twin goals of denuclearization and peaceful reunification. The Korean Peninsula, despite the wishes of some, simply won't go away as an abiding and continuing and fundamental strategic challenge for all of us for the future. More broadly, I argue in the report, however, that what the Asia-Pacific region lacks is pan-regional institutional architecture capable of managing, ameliorating, or reducing the growing array of political, security, and economic divisions across the neighborhood. APEC is a successful economic institution that promotes regional free trade. But the truth is it has no political security function, was not designed as such, and never can have one because of the presence of Hong Kong and Taiwan as economies, but not as political entities, as well as the participation of various Latin American countries with negligible interest in the security deliberations of the more immediate region. And there's a further problem. India is not a member. Then we have another institution, the ASEAN Regional Forum, the ARF, which does have a security mandate, but its membership is arguably too wide, including North Korea, which would run the risk of being regarded as a spoiler in any expansion of the ARF's mandate. Furthermore, over a reasonably long history, the ARF has produced, to be frank, limited results. I say this with appropriate Australian modesty. It was an Australian diplomatic initiative, albeit under one of my predecessors, Gareth Evans, for which I salute him. APEC, too, was an Australian diplomatic initiative. We've long been in the architecture business, sometimes more successfully than others. As a consequence, in the absence of even an Asia-Pacific equivalent of an OSCE, empowered to build modest, very modest, confidence in security-building measures among member states, and to manage existing security tensions down, most of the region's security policy disagreements are managed bilaterally, with the result that tensions generally remain high. Across our wider region, there is no culture of regional dispute resolution in the Asia-Pacific. Nor are there the built-in habits of regional security policy collaboration. There are found in some other regions of the world. It could be possible to evolve a more robust pan-regional institution over time out of one of the region's nascent institutional arrangements, namely the East Asian Summit. The EIS already has a mandate to cover political, security, economic, and other regional challenges in the form of the Kuala Lumpur Declaration of 2005. It also already has the necessary membership, including the Great Powers, China, the US, Russia, India, Japan, to evolve such an expanded Asia-Pacific community over time. Furthermore, it is based on the ASEAN-10, which is strategically important in itself, given that Southeast Asia increasingly finds itself as the strategic swing position between Northeast Asia and South Asia. Moreover, ASEAN itself has a successful internal institutional history over several decades now of turning fractious, sub-regional, and historically hostile states into one of, frankly, unprecedented stability. We should give credit where it is due when it comes to the association of Southeast Asian nations. Based on this, the East Asia Summit could evolve into an Asia-Pacific community over time. It could build, for example, on President Xi's recent statements on an Asia-Pacific dream, Yathe Monk, that embraced the spirit, and I quote him, of an Asia-Pacific community and a sense of shared destiny, unquote. It is also not necessarily inconsistent with his articulation of an Asian security concept. Yadzhe Antuan Guan, particularly following his remarks at the conclusion of his November 2014 summit with President Obama. It's important to reflect on those remarks very carefully. Xi Jinping welcomed America's constructive participation in the region's future and held open the possibility of reconciling his Asian security concept, referring to the outline of security architecture, outlined again much earlier in his Seeker's speech in about August of last year, and reconciling that, on the one hand, with his speech on an Asia-Pacific dream, delivered at APEC, on the region's economic future. There is enough, shall I say, possible commonality in the language to craft something up the middle. And we Australians are always in the business of trying to craft something up the middle, if you can. This possibility presents a unique opportunity in 2015, which marks the 10th anniversary of the formation of the East Asian Summit at the 2005 Kuala Lumpur ASEAN Summit. Ten years later, that summit, celebrating its first decade of existence, will again convene in Kuala Lumpur. The virtue of the EAS is that it is anchored in the concept and practice of the Association of Southeast Asian Nations Centrality, ASEAN Centrality. This is of fundamental importance to the countries of ASEAN themselves, but also serves the wider region well. The 18 member states of the East Asian Summit are Australia, Brunei, Cambodia, China, India, Indonesia, Japan, Laos, Malaysia, Myanmar, New Zealand, the Philippines, Russia, Singapore, South Korea, Thailand, the United States, and Vietnam, and include, therefore, all those directly relevant to the wider region's future strategic stability, with one obvious exception, North Korea. There would be no need, therefore, to build a new institution and go through the difficulties and arguably the insurmountable difficulties of determining new membership, as this matter has frankly already been resolved within the framework of the EAS, which has been around since 2005 and expanded its membership twice since then. Furthermore, as I've already noted, on the question of the mandate of a future Asia-Pacific community, this already exists in the form of the Kuala Lumpur Declaration of 2005. If you read that simple declaration, it covers political, security, economic, and other forms of pan-regional cooperation. In other words, a new mandate would not need to be negotiated between member states. It already exists. The hard work has already been done. Moreover, in terms of treaty architecture, all member states of the EAS have already signed and ratified the Treaty of Amity Incorporation, the TAC. All 18 member states of the EAS are, therefore, under treaty law, committed to the principle of peaceful dispute resolution. No member states would have to confront the difficult process of drafting, signing, and ratifying new treaty law. Something which I understand is actually very easy here in Washington. No, that was irony. This would be a particular problem for the United States. Once again, the work in terms of the ratification of the TAC way back when, way back then, I should say, that work has already been done. The question obviously arises, therefore, as to what conceptual and operational proposals can be brought to the table in order to transform the East Asia Summit into a more comprehensive pan-regional institution capable of cultivating the habits and practices of political, security, and economic cooperation. A number of possibilities exist, including agreeing on a target date of 2020 to transform the EAS into an Asia-Pacific community, thereby providing sufficient time to develop an agreed scope of future operations. Two, importantly, bringing the existing Defense Minister's meeting, currently called the ADMM+, the ASEAN Defense Minister's Plus 8, directly under the umbrella of the East Asia Summit, or the Asia-Pacific community, as it could become. Importantly, these two entities, the EAS, and the ASEAN Defense Minister's Plus, have identical membership. This will give the APC, the Asia-Pacific community, a security arm and a framework for military defense and security cooperation among the 18. Furthermore, the mechanism for transforming the EAS into a fully functioning Asia-Pacific community could be discharged by a permanent secretariat located in one of the ASEAN capitals, Singapore, Kuala Lumpur, and Jakarta, being the most obvious choices. In time, given the vast challenges of the Asia-Pacific region, across political, economic, and military, and other policy domains, the region will need its own equivalent of Brussels in order to build organizational strength for such an institution over time. The institution cannot, in my view, become strong if it is driven by machinery that is purely rotational, moving from one capital to another, as hosting rights change each year. Furthermore, the East Asia Summit, or the Asia-Pacific community, should be convened at the head of state level in order to ensure its maximum continuing political authority, including, therefore, the participation of President Xi Jinping in the future. And an East Asia Summit, Asia-Pacific Community Summit, should be held annually in the ASEAN capital designated for its permanent secretariat. It should not become a permanent traveling circus as so many of these institutions become. It should also be held, in my argument, in the first half of the year, as a standalone summit. It should not simply be tacked on as something of an afterthought to an annual APEC summit, not least because the EAS and APEC have significantly different memberships. Also, I would say this with the deepest respect to my American friends. It's important for American presidents not to quote, visit Asia once a year, in the second half. It's good institutionally to visit Asia twice a year, including the first half of the year. Last time I looked, it was a very big continent. And if I have one minor mission in public life in this country, and so long as you extend the welcome mat to me, I welcome and look forward to the day when here in the United States, you don't simply blandly refer to visiting Asia. When, for example, the United States president visits Singapore, let me tell you the people in Mongolia don't jump up and down and say, what a wonderful thing and thank you for visiting our continent. I hate to say that when an American president visits Japan, the response in Delhi is to say, well, thank you, Mr. President, for visiting our continent. I think Asia has become significantly important in itself and sufficiently important in itself to warrant a more textured consideration at the highest levels of American policy deliberation. I look forward to the day, therefore, when it's routinely said that the president this week visited India and Indonesia and the second half of the year he visited country X and country Y. But this might be just the heartbeat of an Australian romantic. The first task for an emerging Asia Pacific community could be to elaborate a comprehensive set of regional confidence and security building measures or CSBMs, including a full set of military hotlines, military transparency measures and pan regional protocols to handle unplanned military incidents across all 18 member states. The existence of such hotlines at present is very thin across the wider region. Having discussed, for example, with our Japanese and Chinese friends, the absence of such arrangements only at the beginning of last year, it struck me that in the midst of the Senkaku crisis and the midst of the Dyaudal crisis that in fact there was no mill to mill mechanism for handling an incident in the air or on the water. Now they're developing one. When I put to my Japanese and Chinese friends, well, what do you use in the event of such a crisis? They said, the embassies, of course. Well, I'm a former Foreign Service Officer that caused me instantaneously to panic. The idea of relying upon embassies in their own arcane forms of communication, I see many colleagues in the diplomatic corps here to handle a military incident at sea or in the air is, shall I say, challenging. A second task for such an expanded East Asia Summit or nascent Asia Pacific community could include the development of fully integrated natural disaster response mechanism across the region, involving all of the region's natural disaster management authorities, and integrated virtual command structure in the event of a major incident involving the capabilities of a national government where that national government was not able to cope. This work has in fact begun under the nascent framework of the East Asia Summit. How do I know that? When my last acts as Australian Foreign Minister was to draft the framework for such an agreement with my colleague from Indonesia. It does, however, need to be taken much further, given the growing intensity of extreme weather events. There's also in turn, in terms of service to service cooperation, not to mention national government cooperation becomes another very basic confidence and security building measure. Third, work could also begin on the question of developing much greater military transparency over time. Before I conclude my remarks today and we get down to a conversation with each of you in the room here, let me make some concluding remarks about how what I describe as constructive realism could also apply at a global level and not just at a regional level. What are the possibilities here? US-China global collaboration and cooperation in this domain, that is the global domain, occurs against a background of mounting problems in global governance and increasing Chinese interest in the reform of the global order. States are concerned at the growing inability in capacity, in some cases dysfunctionality, of a number of our multilateral institutions, including the UN generally, the World Health Organization, the United Nations Framework Convention on Climate Change, the World Trade Organization, even the World Bank and the G20 in meeting the expectations of the international community. The mismatch between the growing list of challenges, facing the international community on the one hand and the decreasing ability of both international institutions and national governments to effectively deal with those challenges on the other, is a major problem for all states, large and small. This provides an opportunity for joint initiatives multilateral reform from the US and China, rather than simply assuming that their positions will always be at loggerheads. They are not, as their recent joint collaborative work with the, on Iran, in the P5 plus one context has demonstrated. First, the US and China should intensify their collaboration within and beyond the UNFCCC on climate change during 2015, in the lead up to the Paris Conference of the Parties, to build and to agree on a globally binding treaty on climate change. This should also involve trilateral cooperation with India, given India's historic reservations about the impact of greenhouse gas mitigation on development. If the US, China and India can forge a joint approach to Paris, there will be a global agreement. If not, there won't be a global agreement. Such collaboration should also continue and intensify beyond Paris during the critical period of implementation of national climate change commitments. Second, the US and China should drive a global public private investment initiative through the G20 on sustainable development, energy security, including renewables and energy efficiency. This is necessary to deal with climate change. It is also necessary for developing countries to adopt alternative energy solutions for effective action on climate change that does not impede their own economic growth development path. This type of initiative, driven by global public policy and finance in large part by underutilized global private capital, can also help provide a new growth engine for a global economy, which has been lacking drive since the financial crisis. Concern about climate change can only be translated into sustainable action if we simultaneously deal with long-term energy security for developing and emerging economies. More broadly, the US and China should develop a joint initiative for the re-energization of the G20 as the agreed premium institution for global economic governance. Both China and the US were co-founders of the G20 at summit level in 2008. Together, they formalized the long-term institutionalization of the G20 at the 2009 summit at Pittsburgh. Five years later, the G20 is beginning to lack global focus at a time of continuing global economic uncertainty. With China's upcoming G20 presidency in 2017, a major new opportunity presents itself for significant reform. We should work with China on that because in the absence of the G20 functioning at the center of global economic governance, there is no other institution effectively on offer. Furthermore, and beyond the political ruckus over the establishment of the Asian Infrastructure Investment Bank, we need a more rational debate about the future of the Bretton Woods institutions. Over time, the US should consider, together with other World Bank stakeholders and through transparent and meritocratic processes, having a Chinese representative take over the presidency of the World Bank, if and when Chinese capital contributions become the bank's largest. This will cause general shock and horror in Washington at the very suggestion of this possibility. But given the relative size of the two economies, this begins to make some sense over time. But my core point is this, if the US wants China to work within the Bretton Woods system, rather than outside it, this would be, in fact, a very practical initiative. Given the continuing dominance of the US dollar as the dominant reserve currency in the world, the US should instead consider taking on the presidency the IMF. Given the changing shape of the global economy, the West's automatic continued leadership of the two major Bretton Woods institutions that is the bank and the fund, may have reached indeed its use by date. Furthermore, the US should ratify the UN Convention on the Law of the Sea, UNCLOS. China did so in 1996, although in 2006, it registered its reservations concerning the applicability of the convention's dispute resolution mechanisms to its own maritime claims. If the US ratifies and undertakes to apply UNCLOS mechanisms to its own outstanding maritime claims, China should then consider submitting its claims to UNCLOS as well. Both UNCLOS and the International Court of Justice have proven to be effective dispute resolution mechanisms for other states in the region with outstanding maritime and territorial claims. And by doing so, China would demonstrate to the world that it is voluntarily submitting controversial claims to international law. It would also fundamentally deal with many continuing geopolitical tensions in East Asia, particularly if all parties committed advance to accepting the final jurisdiction of the tribunal. These are complex matters. They are hard and they are difficult. But with political will, they are doable. To conclude my remarks today, I would simply say this. When I talk about the possibilities of constructive realism and a common purpose, it does not seek to construct a framework which solves all problems. It will not. However, I do fear as an observer of this relationship over many decades now and as someone who has a deep affection for both these countries, the United States and China, that in the absence of fresh political imagination, there is a danger of long-term strategic drift. That's what concerns me. And therefore, the recommendation I put forward is a possibility of a de minima common strategic narrative, a de minima common strategic framework between the two, which does three things. One, identifies where the real, realist problems are, but agrees also on a protocol for their management over time. Two, seeks to develop political capital and balanced out of these areas of diplomatic cooperation also over time. Step by step, inch by inch, building, I hope, a level of usable and deployable strategic trust. And three, to deploy that capital in turn over time to deal with the new challenges of the future. But most critically also, sustaining an order, a viable global order which benefits both China, the United States and the rest of us for the future as well. This therefore does not represent any panacea for the raft of security and other problems which exist between China and the United States. You're simply offering one framework which can still exist within the realist frameworks of both Chinese and American strategic thinking. I thank you very much. I was wondering why he was handing me that. Well, thank you, Kevin. Wow, very comprehensive and thank you so much for that. I'm gonna steal the privileges of the chair and ask one first question that didn't really come out in your opening remarks. And that is what drew my attention immediately in the title of your report is the key line under Xi Jinping. And of course, we've had extensive conversations about Xi Jinping as a leader and the fundamental role that plays in all of this. And I wondered if maybe you would elaborate on your thinking a little bit about that and how it ties in to what you did present. Well, thank you very much and thank you, Chris. I think what I've focused on today is frankly the policy recommendations end of the report. The primary analysis in terms of the sustainability of China's growth over time, sustainability of Xi Jinping's leadership over time, the directional shape which Xi Jinping's leadership is taking is covered in the first half of my report. And these, of course, only form part of a summary report. The true encyclopedia Britannica will come out in the next several months, some several hundred pages. This is a 40 or 50 page summary. I think on the question of Xi Jinping's leadership, what I conclude in the report is pretty basic. One, as I think has now been accepted, Xi Jinping is China's most powerful leader, not necessarily just since Deng, possibly since Mao. Rod McFarquah made a very good point recently in the time of Deng Xiaoping. Deng Xiaoping still had to deal with, shall I say, significant peers, Chen Yun, other revolutionary leaders who had been around since Adam was a boy or at least the Chinese Eighth Route Army equivalent of Adam as a boy. And therefore when they confronted decisions together, frankly there was a council of ultimate peers. If you look at Xi Jinping and the seven members who currently make up the Standing Committee of the Politburo, it's not quite like that. Xi Jinping is not just, as I've said before, primus into pares, Xi Jinping is primus. That I think is important. I think the second thing that's important about his leadership is his keen and acute sense of national direction for China. If you wanna sense and know what the content of the economic policy direction is, read the decision of the third plenum of the 18th Central Committee, it's pretty clear what that direction is. He has a defined and clear blueprint for the country's economic future because he clearly grasps that economic power is the basis for China's national power. But I think the other element is clear and you see this most recently as you and I have discussed, his remarkable statement at the Foreign Affairs Work Conference of the Party Center at the end of November last year, where he outlines what he describes as a new great power diplomacy with Chinese characteristics. He outlines what he described as a new system of international relations. He outlines and re-emphasizes again the importance of a new type of great power relationship. He speaks of participation and struggle for the future shape of the global order. Guo Ji, Ji Xiu, Ji Zhang. These are not the statements that we're accustomed to from either Hu Jintao or Zhang Zemin. And frankly, from Deng Xiaoping either. These are quite new, but I think the last thing I'd say is the Xi Jinping have it therefore within his strategic mindset to contemplate the possibility of pushing the envelope with surrounding states and certainly with the United States in any form of armed conflict. The report is definitive in its conclusion that the probability of that occurring is negligible. But however, what I also say is that China, given its own acute sense through Xi Jinping's eyes of its rising regional and global economic muscle, will extend therefore its political and foreign security policy influence in order to underpin China's national interests. I think what is often lost consciousness, lost in awareness in this capital is that if you go through the exercise of just listing every Chinese trading partner in Asia and put down against each Asian country, the volume of trade with China and the volume of trade with the United States, you cannot find a single country today in which China is not the dominant trading partner. That wasn't the case five years ago. It wasn't the case three years ago. It is the case today. And that's against a slightly, shall I say, compressed Chinese overall trade effort given constraints of growth. Therefore, my argument is the economic ground is actually shifting under America's feet in Asia. Certainly when it comes to trade, investment flows will follow trade and are following trade. What happens with the currency, of course, is a separate question again. Thank you. Okay, we will follow standard CSIS procedures. So please wait for a microphone and do identify yourself and constrain yourself to a question rather than a commentary. And the floor is open. Over here in the corner. Please wait for the mic. Thank you, Prime Minister. It's a great pleasure to see you here and congratulations on the report. It's so beautiful. I spend days before I got this heart copy. Yeah, I printed them all off by hand, half a shot of mine. It's so beautiful. And then I find something different from the online, if I miss it, set a dedicated to Henry Kissinger and continue bridge in US-China relations. So my question is, this bridge seems missing somewhere across the Pacific Ocean. And here and there. Are you trying to build a bridge? You know, or as wide as the Pacific Ocean that on this side we have a government of the people. For the people, by the people. And we are on the other side, you have a government of the party, by the party and for the party. Thank you. That's the only different I can tell. Thank you. Well, I think the bottom line is the world's pretty complex place. It ain't simple. These two countries are very different. Therefore, I think one of the value ads which can be provided, I think Henry has done this over a long period of time. And I try to do it at a much more modest level is to try and as accurately as possible describe strategic perceptions of one side toward the other. And not to do so in a way which says right, wrong, good, bad, necessarily. But to say this is my attempt to define China's strategic bottom lines and their view of the United States. One of those bottom lines, by the way, and I think Chinese analysis is along these lines, that they do not see it as being faintly in the interests of the United States to allow China to ever become the dominant power in Asia. Therefore, they perceive all elements of US policy, both the claretry and operational, through that prism. We flip over the Pentagon, the reverse view would be, didn't have to dig too far, would be that China and its policy, whatever it says and whatever it's doing has its fundamental objective to remove US alliances and the US militarily from East Asia if it can. In other words, to boot the United States out of Asia, at least in a military and strategic sense. So therefore, given those two deep perceptions, we have a small problem. And that is how do you reconcile these two phenomenon? So that's why I'm at baseline, I'm a realist about recognizing these as the starting points for the reality. But I'm equally realist to know that it is not really either in the makeup, constitution, interests, or personalities of these countries' leaders to risk the possibility of going to war at some stage. Could happen by accident, and that's what worries me. And it could happen by accident through proxy, third parties, which would also worry me. Therefore, bridge building in my way of thinking is about explaining conflicting realities, trying to remove as much cultural baggage in the description of the core reality perceptions, I should say, from both Beijing and Washington towards each other. And then based on the reality that that presents, make recommendations about how, in fact, you could manage the difference and then create political capital and ballast through other forms of less controversial engagement between the two. And so, sustain the relationship over time. That's why I'm in the business of considered professional optimism. I think the easiest and laziest game in international politics is to sit around and look at stuff and say, nah, it's all terrible, it's all gonna end up in a mess. Well, it's a good way to be on television, but let me tell you, it doesn't answer any problems. Now let's see in the back there. Thank you, Prime Minister. Gregory Ho from Radio Free Asia. My question is about how would you, and what's your suggestion in dealing with the corruption issue inside China, especially for Xi Jinping, he is so, there's a so pressing issue to get rid of those corrupted official, or you may say the political enemies of Xi Jinping. And we know that in Australia and US here, there's so many wealthy or maybe corrupted or half corrupted Chinese official living here and invest so heavily here. But the thing is, Australia and US, we don't, we don't have extradition treaties with China. So what is your suggestion to your current government or to the US? Should the West cooperate with Xi Jinping in extraditing those corrupted official, maybe especially for Lin Wancheng, he's the number one wanted. I think I got the point of the question. What is your suggestion? Would you cooperate with Xi Jinping in expelding those corrupted official living inside Australia or USA? Thank you for the very pointed question. I think the first thing I'd say is that in the business of being in political exile, that's me, the last thing you wanna do is to provide public lectures to your own government back home about what they should do of any particular matter, or frankly, as a foreigner and a welcome guest in this country to provide public homilies to the US administration about what it should do. I'm not into that business. I provide what I describe as broad strategic conclusions about where I think the interests of both these great countries can maximally coincide and how we can preserve the peace over time and also build an order over time. Now, if you go down to the question of Xi Jinping's anti-corruption campaign, which you began your question with, the bottom line is this was all pretty clear in his first remarks after he became General Secretary of the Communist Party. I remember his remarks, I think it was at the Li Shibor one, a National Historical Museum, where he said, we don't fix corruption, the party will collapse. And that's what's happened to Communist parties elsewhere in the world. It's a very basic observation, never been put as starkly as that by previous Chinese leaders that I'm aware of. What surprised many within China and even more people abroad is how consistent, continuing and expansive this campaign has been. And his baseline is simply that to achieve China's national purpose, national rejuvenation, a strong and powerful China, Fuchiao, by the centenary of the PRC in 49 and a modestly wealthy China by 2021 that the centenary of the party, he sees the party as the only vehicle to do that and therefore he knows that one of the huge corrosive elements to the party's legitimacy is corruption. Therefore he's acting, it makes sort of rational sense within the system. In terms of whether it actually contributes also to power consolidation, I'm sure in part it does. But anyone who regards these as mutually exclusive propositions I don't think understands Chinese complexity. And on the further question about the applicability or otherwise of extradition laws or arrangements in the absence of laws, this is a matter to be dealt with case by case between individual governments as it always has been in the past and will be in the future. Thank you. Ken, Lieberthal. No, no, no. Up here. Up here, up here. Thank you, Ken Lieberthal of Brookings Institution. Wonderful set of remarks. Over a pleasure to see you. You outlined a very constructive, wide-ranging, almost magisterial approach to positioning the two countries for each other. I've never been described as magisterial in my life. I've never. I'm having lunch with you, I'm trying to deal with it. Seriously, one of the many things that you raised, you didn't have time to really do a deep dive on here, but to me is potentially one of the most nettlesome things as I look to the future is the realm of cyber relations where the technology is developing so rapidly that I think even political leaders have a very difficult time understanding the technology itself. The images that each has of the other are very negative and the implications for military, commercial and political bad deeds are huge. You've commented that we should engage on cyber norms common norms, if I understood your remark correctly. I think we're doing that. We're not having much success at it. And I guess my question is, could you do a little deeper dive on how you would address this issue because it really strikes at the core of distrust of intentions of the other side. Thank you. Can you raise a really important question? It's covered off in one of the recommendations, the report and it's some greater depth in the full report when it emerges. You're right to point to the fact this adds a whole new dimension to the complexity of the US-China global relationship. It is acquiring a dimension, I think, which traditional China watches and analysts and even national governments are struggling to keep across themselves. I may be accused of exaggeration, but the more I look at this one and I'm looking purely at state on state, I'm not looking here on the question of what happens in let's call it the private corporation domain. I think we're beginning to look at the emergence of a new form of weapon of mass destruction. If a state through multiple capacities is able to disable the civilian infrastructure of another state, if it chose to, and talking about capabilities as opposed to intentions and classical strategic analysis, then we have a problem at mill. We've got to do something about that. It's like the realization of that first burst of nuclear weaponry in the 50s and 60s. When there were elaborate doctrines of actual nuclear war fighting, the people actually finally concluded that this was insanity and that strategic deterrence was the only appropriate response to the conflagration of nuclear weapons we had. And that began, frankly, the disciplines of Dayton and the emergence of a series of operational procedures between the Soviet Union and the United States on how to handle this new phenomenon. I think that's the best analogy for where we are now with the emergence of these extraordinary cyber capabilities, leaving aside the whole question of whether a particular state, China, would ever deploy them against the United States or the United States against any state. It's so destabilizing of, shall I say, mutual confidence. Because this is such a, shall I say, exercise your process in motion. That is, it's rapidly developing and you're right to talk about the political catch-up time on the part of political elites within countries because of the complexity of this, but frankly no more complex than a nuclear weapon when you first explained it. That I think we are in a fast track towards a common understanding of the destabilizing nature of this in the international system between nation states. I may be full-heartedly and optimistic to believe that we are therefore within a reasonable timeframe of those sorts of conclusions being reached in Beijing as well in terms of state capabilities. And I think here in D.C. Therefore, what may seem to be improbable at this stage is reaching some sort of arrangement on how these capabilities are to be disciplined and managed. I think we may see more rapid progress on this in the immediate years ahead than we have over the last five years. Our friends in Beijing, if they've reached conclusions about how a cyber capability could theoretically be deployed against the civilian infrastructure in the United States or any other ally, would simultaneously conclude therefore what that other ally or the United States could do to China in a similar department by a factor of 10. This is a very sobering conclusion on the part of all. Of course, the two footnotes are here corporate and corporate security and attacks on that. And cyber theft and the other, which dare not speak its name really at this stage is where goes the whole phenomenon called cyber terrorism by non-state actors. Thank you, John. We are at time. So I want to thank everyone for their participation today and please join me in thanking Kevin for his presentation. Thank you. Thank you. I understand. You can leave the wallet too, if you want. Thank you.