ON 18 AUG 2005 AT 9.20 AM

1. Today's conference commemorates the 600th Anniversary of the first of Zheng He's voyages amidst considerable optimism about China's future in the 21st century. This was not the case a hundred years ago. In 1905, the 500th Anniversary would not have been celebrated at all. The Qing Dynasty was in its death throes. Ten years earlier, after the defeat of the Chinese fleet, the Treaty of Shimonoseki gave Taiwan to Japan which occupied it for 50 years. In 1905, Japan also annihilated the Russia Baltic fleet in the Straits of Tsushima. The 1911 Revolution in China and the 1917 Revolution in Russia which followed were defining events at the beginning of the 20th Century. The fires of nationalism were also lit in India and Southeast Asia. The whole of Asia was in turmoil. Japan's non-peaceful emergence helped to hasten the end of the Western empires in Asia. With the dismantling of the Ottoman Empire after the First World War, the Islamic world entered a new phase. Ataturk's refusal of the Caliphate left the Islamic world leaderless creating a spiritual void which spawned new movements, one of which evolved to become the driving philosophy of Al Qaeda today. Among the Western powers, the centre of power moved across the Atlantic from Great Britain to the United States.

2. For much of the 20th century, there was little pride in being Chinese. On the Mainland, it seemed as if war, revolution and internal strife would never end. It was only on the periphery, among the overseas Chinese and the Chinese overseas, that progress seemed possible. The economic development of Taiwan, Hong Kong and Singapore in the 70's and 80's, and of Chinese communities in Southeast Asia and North America, gave some hope that perhaps one day, too, the Mainland would make progress. It was Deng Xiaoping who made the decisive move to open up China in 1978 and, again, in 1991, two years after June 4th. The result has been dramatic.

3. India, too, is at long last on the move. Under Narasimha Rao in 1991, India also opened up. In the last 10 years, it has grown at an annual growth rate of 6%. Last year, despite a bad monsoon, it achieved 7%. In the coming years, India should be able to sustain 7-8% growth a year. India has become a second pole of development in Asia.

4. The recent improvement in relations between China and India is of historic importance. Beijing and Delhi have agreed on the principles for settling their border dispute, basically to exchange China's claim to Aksai Chin for India's claim to Arunachal Pradesh, along the present line of control. This is the last stretch of the Chinese land border to be demarcated. China has been able to delineate its land border with every other neighbouring country. Trade between the two countries has also been growing rapidly. Last year, China became India's second largest trading partner. Chinese and Indians are once again talking of a new era of 'chini-hindi, bhai bhai'.

5. Provided we do not trip ourselves, the countries of Southeast Asia will be swept along by the re-emergence of China and India on the global stage. This Asian transformation involves more than half the world's population and will define the 21st century.

6. What will the world be like when we celebrate the 700th Anniversary of Zheng He's first voyage in 2105? Nothing is inevitable in human history. There will always be surprises. In 1905, it would have been impossible to envisage the world in 2005. Similarly, trying today to divine the world in 2015 is equally unrealistic. However, there are a number of challenges we know we have to face, challenges which can lead us either to a better world or to another tragedy. I can think of three which will affect us in a fundamental way.

7. The first challenge is the management of Sino-US relations. That these two great countries should be rivals in the coming decades is for certain. If they become enemies and go to war with each other, the whole world will be plunged into darkness. With its military technology, the US will win the initial battles. But that will only mark the beginning of a long war which will encompass every dimension. Unlike the Cold War between the US and the Soviet Union, the US and China are increasingly bound by a million links of trade and human intercourse. Conflict between them will affect every country in Asia, all multi-national corporations and millions of families. For this reason, it is unlikely that, as rational powers, the rivalry between the US and China will reach such a breaking point. It is more likely that they will cooperate and compete at the same time. The problems of North Korea and cross-straits relations, which are residual problems of past wars, are sub-sets of broader Sino-US relations. If Sino-US relations are reasonably well-managed, these two problems will be overcome.

8. The second challenge is the construction of a new architecture of cooperation in Asia itself, bringing together East, Southeast and South Asia. This process, which will take many years, is already underway. If we succeed, the centre of the world economy will move to Asia in this century and a new east-west trade dwarfing anything which had been seen previously will come to be. Good relations between China and India will be the foundation of such an architecture. Such an Asia will automatically be open to North America, Europe and the rest of the world. It will sustain and advance the multilateral trading system. The convening of the first East Asia Summit at the end of this year in Kuala Lumpur is therefore of great significance. The growth of China and India will also put pressure on the ten countries of ASEAN to become a political and economic community.

9. The third challenge is the establishment of better relations between Muslims and non-Muslims in Asia. This is a complex issue involving both religion and politics. Historically, the patterns of contact between Muslims and non-Muslims in East, Southeast and South Asia have been different from those between Muslims and non-Muslims in West Asia, North Africa and Europe. When Zheng He sailed these waters, there was no sharp conflict between Muslims and non-Muslims in Asia. There were conflicts, yes, but nothing like those in the West. When the Europeans came into the Indian Ocean a century later, they brought their conflicts with Islam into the region. The Moors of North Africa became the Moros of the Southern Philippines. Looking ahead, the management of Muslim-non Muslim relations in South Asia, Southeast Asia and Western China will be very important to peace and economic development in Asia. Failure to do this will provide fertile ground for terrorist groups like Al Qaeda and Jemaah Islamiyah to carry out their activities and recruit new members. How the teachings and practices of Islam evolve in this century is not for non-Muslims to decide. But the way non-Muslims interact with Muslims will affect the course of this evolution. It will be a grievous mistake for non-Muslims to tar all Muslims with the brush of international terrorism.

10. All three challenges - good Sino-US relations, pan-Asian cooperation and harmony between Muslims and non-Muslims - affect the Chinese overseas profoundly. Success will help the Chinese overseas to flourish and make contributions wherever they live. Failure will once again cause them to be isolated and oppressed. We have every reason to weigh in on the right side, and maximize the likelihood that the next centennial celebration of Zheng He will be a happy one.
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