HONG KONG -- Publicly, American officials such as Secretary of State Colin Powell are saying that relations with China are the best they have ever been. Privately, however, policymakers are not shy about admitting that the two countries are engaged in a diplomatic contest in many arenas, most notably in Southeast Asia.
While China may not deliberately wish to replace the United States as the dominant power in the region, its emergence as an economic powerhouse inevitably forces its neighbors in Southeast Asia to sit up and take notice. Some Southeast Asians still see China as a rival for foreign domestic investment and overseas markets, and wish to see a stronger American presence as a counterweight. Many others now see China's rise as offering new opportunities as Beijing imports raw materials from Southeast Asia and as Chinese businesses make investments there.
China and the U.S. are not the only countries making overtures to Southeast Asia. Japan, South Korea and India are all courting the region. However, China is clearly ahead in the race. Beijing and the 10-member Association of Southeast Asian Nations have agreed to set up the world's largest free-trade area by 2010, one that will comprise almost 2 billion people with a total gross domestic product of almost $3 trillion.