Remarks on Northeast Asia

Wendy R. Sherman
Under Secretary for Political Affairs 
Carnegie Endowment for International Peace
Washington, DC
February 27, 2015

UNDER SECRETARY SHERMAN: Well, good morning to you all. And thanks especially to Bill Burns for that really lovely introduction. It’s nice to see that there really is life after the State Department. (Laughter.) For your information, Ambassador Burns, I spent much of the past week in Europe engaged in negotiations with Iran and our multilateral partners regarding Tehran’s nuclear program. I mention this to make the former deputy secretary feel nostalgic and realize all the fun he’s been missing. (Laughter.) Because there’s no question that Carnegie’s gain is the State Department’s loss.

We all know people who are smart, who work hard, who have broad experience, or who are visionary. We all know people who are fun to be around or who can be counted on to keep their cool when everyone else is going a little nuts. What we rarely run into is someone who combines all those qualities, and that’s exactly what Bill Burns does. And so we, I miss him terribly, but we also know exactly where to find him. And there’s no doubt that although he may have retired from public service, Bill’s wise contributions to the discussion of world affairs will continue. I count him as a very close advisor to me, to the Secretary, to the President of the United States, and that’s a blessing to all of us. Thank you, Bill, for your continued service.

This morning, I welcome the chance to talk to you about relations between the United States and three nations: Japan, China, and South Korea. It’s the right time to do so, because throughout the remainder of the Obama Administration, Northeast Asia will continue to be a major focus of U.S. foreign policy. In November, President Obama had a fruitful visit to China for the APEC Summit; Deputy Secretary of State Blinken just returned from the region; and in the coming months, Prime Minister Abe and Presidents Park and Xi will all make separate trips to Washington.

I went to Northeast Asia myself earlier this month and returned with a strong sense that we are at a pivotal moment; amid chronic dangers, there are also opportunities for the region to reduce tensions and became one of the globe’s sturdiest platforms for international prosperity and peace.

To begin, a story from a former colleague and veteran Asian hand, Ambassador Winston Lord.

Sometime ago, he and his wife – the very learned Bette Bao Lord – visited an ancient temple outside Beijing. They were met by the head priest who asked them to inscribe a few words that, as he put it, might help to guide and instruct future visitors to the temple. Winston said at that moment his ego inflated and he began frantically running through his mental storehouse of wise sayings. A short time later, an aide to the priest came forward with a brush, a jar of ink, and two small wooden planks. After an exchange of bows, the priest clarified his request. “To guide and instruct future visitors,” he said to the proud American scholars, “please write one plank the English word for ‘Ladies’ and on the other for ‘Gentlemen.’” (Laughter.)

The moral, according to Ambassador Lord, was that whenever Westerners hope to impress Asians with their wisdom, we might well begin by showing humility. This morning, I would add that, in addition to humility, it’s also necessary to approach Asia with an appreciation of the past. I say that because the past is very much present in East Asia today. It affects the temperatures of relations between countries and helps determine how every gesture is interpreted. The impact is sharpened by the fact that 2015 marks the 70th anniversary of the end of World War II.

As I found during my recent trip, this anniversary is considered a pretty big deal in the Asia-Pacific, just as it is here. Seven decades ago, in fact, my own father was a U.S. Marine. He fought and was wounded in the Battle of Guadalcanal, a six-month campaign which eventually turned the tide in that terrible conflict. None of us should underestimate the trauma of those years, which did begin in aggression and ended in an uneasy dawn of the nuclear age. For millions, the war meant death, and for survivors, the loss of loved ones and an utterly changed way of life. Little wonder that the ordeal opened wounds of body and mind that in some cases have still not fully healed.

In the hearts of many, the conflict also generated a fervent desire to prevent such a catastrophe from ever happening again. My parents were part of that category of people, so when the fighting was finally over, they journeyed to San Francisco simply to be present at the founding of the United Nations. The very first line of the UN Charter expressed the determination, “to save succeeding generations from the scourge of war.”

Given the lofty nature of UN ideals, we sometimes forget that the world body wasn’t the creation of starry-eyed dreamers; on the contrary, it was the handiwork of clear-eyed realists just emerging from the crucible of the Holocaust and global conflict. And they saw as their most urgent job the development of institutions that would keep nations from once again ripping each other apart. Today, we’re called on to continue this quest, but to succeed, we must learn from the past and shape institutions and arrangements of our own.

Since the first weeks of the Obama Administration, Asia has figured prominently in American foreign policy. The famous rebalance has come into its own despite many other demands. We’ve achieved a new normal of sustained, well-resourced, high-level engagement with the region. But it’s worth remembering what the rebalance is and what it was never intended to be. It’s not a move away from the Americas or from Europe, and it’s not primarily a military strategy. Rather, it’s simply a recognition of reality. America’s security and prosperity are inextricably and increasingly linked with the Asia-Pacific.

The United States, China, and Japan are homes to the world’s three largest economies, and Korea has moved into the top twelve. Outside of Europe and North America, these are the largest trading partners of the United States, and trade within the region and around the Asia-Pacific has skyrocketed. This expansion of economic influence has an impact in other arenas, including security and diplomacy. Events in East Asia will inarguably affect the future of us all.

In the past quarter century, China’s economy has grown at a faster rate over a longer period of time than any other in history. Extreme poverty has declined sharply, average life expectancy has more than doubled, illiteracy is vanishing, the middle class has mushroomed, and Chinese industrial centers have become magnets for foreign investment. Of course, as investors are frequently reminded, past results are no guarantee of future performance. China, by its own admission, faces a variety of domestic challenges, including an aging work force, a widening gap between rich and poor, the need to stimulate domestic consumption, and a level of pollution that is literally breathtaking.

Over the years, U.S.-China relations have had their ups and downs, but American policy has been remarkably consistent. Presidents from Nixon to Obama have agreed on the importance of engagement, going forward issue by issue, coming together where we can, and narrowing gaps where possible. As our relations have matured, U.S. and Chinese leaders have developed the ability to be very frank with each other. China has complaints about the United States, including our respect for the Dalai Lama and our friendship with the people of Taiwan. For our part, we continue to raise issues of human rights and freedom in all their dimensions. We do so to be true to ourselves and because history has shown that nations that uphold these rights are ultimately more prosperous, more successful, and more able to achieve the dreams of their people.

Of course, there is suspicion in some quarters that because of our differences, America is rooting against China. But the reality is that the United States very much wants China to be stable and prosperous. And that’s not because we’re just altruistic; it’s for the same reason that in the 1990s, we supported Beijing’s membership in the WTO. We recognize that China’s success benefits our own, just as our progress supports China’s. That’s also why we’re working to reach agreement with Beijing on a bilateral trade and investment treaty, a pact with high standards that would provide a level playing field for U.S. investors and ensure that commercial ties are supported by the rule of law.

Meanwhile, China is not the only country in East Asia that has been rising. Since I was a teenager first learning about the world, South Korea has made amazing progress. It has graduated from international aid recipient to aid donor, the result of an explosion of innovation, economic reform, and greater democracy. As a reflection of its new status, South Korea has in recent years hosted a G-20 summit, served on the Security Council, and seen one of its most able sons elected and re-elected secretary-general of the United Nations.

Bilaterally, we’re now in the third year of the U.S.-Korea Free Trade Agreement. We’ve seen four rounds of tariff cuts on goods such as cars, trucks, appliances, and medicines, and the export of services is up as well. This is America’s most significant trade agreement in almost two decades and it is building an even stronger foundation for the future of our alliance with Seoul. Like Korea, Japan is America’s ally and close friend. We share a love of democracy, a belief in human rights, a commitment to peace, and some pretty good baseball players.

Japan is also by far the largest economy among the countries with whom we are currently pursuing the Trans-Pacific Partnership, a 12-nation trade and investment regime that encompasses two-fifths of the globe’s economic output, and that will include landmark provisions governing labor, the environment, and internet freedom. Instead of a plunge to the bottom, the TPP will encourage a race to the top. And it will contribute to prosperity all along the Pacific Rim.

One fact that strikes me whenever I visit Japan is the depth of interests and values we share. Japan has long been a lead supporter of international law and a generous contributor to overseas development. In recent years, its role has expanded to include logistical support for coalition military forces in Iraq and in Afghanistan. The Iran nuclear negotiations are also of great concern to the Japanese, given their country’s ability to contribute in any discussion regarding the peaceful use of nuclear energy.

And tragically, in recent weeks, Japan has been given new and urgent reasons to look outward. When I was in Tokyo, the first of two Japanese hostages held by the ISIL network had just been killed. The second, Kenji Goto, was a man of singular decency and courage whose sole purpose in entering Syria had been to rescue his countryman. Despite widespread appeals for his release, Mr. Goto was murdered shortly after I left. The killings were an apparent retribution for Japan’s pledge of $200 million in humanitarian assistance – I repeat, humanitarian assistance – to the victims of fighting in the Middle East. The terrorist leaders have since threatened the Japanese, saying that they have “an entire army thirsty for your blood.” As in Pakistan, France, Jordan, Egypt, the United States, and many other lands, the effort by violent extremists to intimidate and divide the people of Japan will surely instead bring them together. The horror of the executions was deeply felt, and the threat to Japanese citizens worldwide has fed an internal discussion that has been ongoing about the appropriate role of the country’s self-defense force. Japan as a nation is working to reconcile modern demands with hard-won lessons from the past.

This is, in a broader sense, the challenge faced by the entire region. To what extent does the past limit future possibilities for cooperation? The conventional answer to that question, sadly, is a lot. After all, relations within Northeast Asia are often less than smooth. In recent years, we have seen tensions heighten over the Senkaku Islands, which Tokyo administers but which Beijing asserts were once part of greater China. Japan is wary of China’s rapid and opaque defense buildup. The Koreans and especially the Chinese are sensitive to any change in Japanese defense policy. The Koreans and Chinese have quarreled with Tokyo over so-called comfort women from World War II. There are disagreements about the content of history books and even the names given to various bodies of water.

All this is understandable, but it can also be frustrating. Any architect who set out today to design a platform for international security, prosperity, and peace would love to include in her blueprint a harmonious and cooperative East Asia. There can be no question that the world would be safer, richer, and more stable if the United States, Japan, China, and South Korea were consistently pulling in the same direction, and that’s definitely what the majority of the people in the region want. Of course, nationalist feelings can still be exploited, and it’s not hard for a political leader anywhere to earn cheap applause by vilifying a former enemy. But such provocations produce paralysis, not progress. To move ahead, we have to see beyond what was to envision what might be. And in thinking about the possibilities, we don’t have to look far for a cautionary tale of a country that has allowed itself to be trapped by its own history.

I am one of the relatively few American diplomats who have negotiated directly with North Korea’s senior officials. In the process, I found first of all that those leaders do indeed follow international affairs closely, even though the lens through which they view events is narrow. Second, they would very much like to drive a wedge between America and our allies in Seoul and Tokyo, and even our relationship with China, but that’s not going to happen. Third, they see in Pakistan – a country whose nuclear program was first protested, then accepted – and hope to follow that example, which also isn’t going to happen. Fourth, they have known for many years that their economic model is a failure, but fear that opening up as China and Vietnam have done would entail too much political risk. Finally, the authorities in Pyongyang crave attention and respect, but they haven’t a clue about how to obtain either except through the threat of force. They are apparently under the illusion that the best way to conceal a weak hand is with a clenched fist.

In the last quarter century, the contrast has widened between the prosperity generated by the South’s freedom and the hardships spawned by the North’s repression. Despite its bluster, the North’s strategy has failed utterly. Instead of gaining acceptance, the country is increasingly isolated. Instead of self-reliance – juche – it has lost strength from within. Instead of bold reforms, it has settled for ineffective steps that leave the majority of its citizens malnourished, saddled with obsolete technology, politically impotent, and eager to get out.

It was suggested to me during my recent trip that by insisting on the goal of a nuclear-free Korean Peninsula, we are ensuring, because of Pyongyang’s stubbornness, that nothing will change. But that conclusion is simplistic. The fact is that a great deal is happening. The diplomatic pressure on North Korea continues to intensify. President Obama recently signed an executive order that authorizes new sanctions. In September, the IAEA General Conference unanimously condemned North Korea’s nuclear program, which China has exhibited unprecedented firmness in opposing. And late last year, the UN Security Council undertook a first-ever public review of the DPRK’s abysmal human rights practices.

We all understand that the situation on the Korean Peninsula does not have a quick or simple solution. After all, U.S. troops have been deployed there for 65 years. But our resolve is undiminished and our patience to get to the right answer is inexhaustible. At the end of the day, North Korea cannot obtain the security, prosperity, or respect it wants without negotiating an end to its provocative nuclear and missile program.

My purpose this morning has been to emphasize the importance of cooperative relations between the United States and major powers in Northeast Asia, and also within the broader Asia-Pacific region. In principle, I think this need is well understood. During my trip, I was impressed by the diplomatic efforts toward that end that are being made, some in public and some behind the scenes. In the APEC meeting last November, the handshake between President Xi and Prime Minister Abe sent the right signal to their respective governments and populations. This year is also the 50th anniversary of the normalization of relations between Seoul and Tokyo. Plans are afoot for a three-way ministerial to be held in Korea next month with the expectation of a summit to follow.

Certainly there is no shortage of global problems which our four nations could work together to address. China is one of our P5+1 negotiating partners in the effort to ensure that Iran’s nuclear program is wholly peaceful. Japan has been among the many countries that have joined in imposing sanctions against Russia because of its aggression in Ukraine. Korea has been a host and leader in the community of democracies. China has begun to support – to expand its support for Afghanistan as that country assumes full responsibility for its security.

We all have an interest in developing rules of the road for cyber security. All of our nations have a profound interest in stopping the spread of violent extremism, and in supporting efforts to reduce poverty, ignorance, and disease. And likewise, we all have a stake in reducing the emissions that contribute to global warming. Last November, U.S. and Chinese leaders achieved a breakthrough when we each committed to more rigorous greenhouse gas reductions goals. That sets an example for the world as we approach the Paris climate talks later this year. South Korea’s hosting of the UN Green Climate Fund and Japan’s $1.5 billion pledge, second only to America’s, further demonstrates a strong commitment to address this vital issue now before it’s too late.

I don’t know about you, but I’m tired of winter.

These and other examples show the potential for a far-reaching economic, political, and security architecture for the entire East Asia region, comparable in its way to the global architecture created in the period following World War II. Already the outlines of that regional structure can be seen. The ASEAN Regional Forum and ASEAN-hosted East Asia Summit have emerged as indispensable venues for the discussion of sensitive security and political issues in a multilateral setting. APEC, representing 21 Pacific Rim economies, was brought together to raise living standards through cooperation on investment and trade and to promote sustainable growth. The United States welcomes its recent focus on supporting small entrepreneurs and the empowerment of women – two of the most reliable ways to create jobs and reduce poverty.

Asia’s rising economic role can be seen in institutions such as the Asian Development Bank, and the G-20, where five Asian nations helped prevent the 2008 global financial crisis from becoming another Great Depression.

Multilateral banks – development banks have great value because of their time-tested norms for sound governance, debt sustainability, environmental protection, and ethical procurement. Accordingly, the United States welcomes new initiatives, such as the China-proposed Asian International Infrastructure Bank, provided its founding documents and practices uphold the high standards of other development institutions.

Now, obviously, when diplomats talk about political and security architecture, we do not mean to simply imply that the structures created are the work of a single hand. By definition, collaboration is required. In fact, they tend to evolve over time, respond to shifting perceptions of need, and result in organizations and groups that have overlapping mandates and memberships. In Europe, for example, regional cooperation is highly developed, yet coordinating the activities of NATO, the EU, the Eurozone, and the OSCE does not happen without strain.

In Asia, the architecture has been slower to take shape and the vastness and diversity of the region leave ample room for further progress. It is vital to bear in mind, however, that institutions and architecture are not ends, but means. They are instruments for carrying out the collective will of their members, but they cannot in and of themselves ensure that members will agree or that their actions will be constructive.

Ultimately, the most important issue is whether the nations of East Asia act in accordance with basic principles of openness, the non-violent settlement of disputes, and respect for the rule of law. It depends, as well, on whether they work cooperatively to support these principles elsewhere in the Asia-Pacific and worldwide – an obligation that America also, as a Pacific power, accepts.

This brings us back full circle to the question of leadership, to learning the lessons of the past, and to understand that, in a dangerous and highly interconnected world, the more we are able to combine our strengths for the right purposes, the better off we will be. That is the message the Obama Administration will be reinforcing constantly in months ahead, and especially as we look forward to welcoming Northeast Asian leaders to Washington.

This is a year of anniversaries. A century ago, the Great War was engulfing Europe. Seventy years ago, the Second World War was ending. Fifty years ago, American involvement in Vietnam was deepening. A quarter of a century ago, the Berlin Wall had just come down. Throughout the decades, we have been witness to a competition between those who destroy and those who build; between those who create division and those who heal; between those who seek to dominate others and those who recognize themselves in the other. As we prepare to write the history of our time, America’s policy is to join forces with those in Asia and elsewhere who recognize our shared responsibility to build and to heal. This matters, for the competition between creators and destroyers is as perilous now as it has ever been, and it is a contest we must win.

I thank you, and I’m now pleased to take your questions. (Applause.)

MODERATOR: Well, thank you, Secretary Sherman. My name is Doug Paul; I run the Asia program here at Carnegie, so I get to direct the Q&A period today.

This set of remarks was really quite ambitious. (Laughter.) You covered a lot of territory on your trip, but you covered a lot of territory in your speech. And I’m – especially on the question of regional architecture – security architecture, I haven’t – I can’t recall a more ambitious speech on this subject in quite a few years. Something must be on your mind about the regional security architecture.

I know that – we all, I think, know last year Chinese President Xi Jinping had a confidence-building conference, multinational conference, suggested Asia for the Asians. What’s your take on that?

UNDER SECRETARY SHERMAN: (Laughter.) Well, I think in the visit that I just had and in the discussions that I’ve had with leaders in each of the major countries in Northeast Asia, everyone is thinking about how to go forward because they’re thinking about the 70th anniversary year and it is a time for reflection. And I think security architecture in any region of the world really is of interest to everyone in the world. It is not owned by any given country or group of countries, it is meant to help promote peace, security, prosperity for the world, globally.

So when you’re – when the European Union was created, when the euro was created, of course, that was meant to create a stronger trading environment and stronger prosperity for Europe, but it also had great consequences for the global economy, and continues to to this day as we have seen. And I think the same is true for Asian architecture. The United States has quite an interest in it because we are a Pacific power, so we have regional interests, but we also have global interests, as should every country in the region, and I believe they do.

MODERATOR: Well, thank you for that. I’ve been alerted by many of the participants in this audience that they’ve got questions today and you have exceeded my expectations in touching on topics that I know will excite their interest. So why don’t we start here in the first row with Chris Nelson.


MODERATOR: Microphone, Chris. Please identify yourself when you’re called upon.

QUESTION: Yes, thank you. Chris Nelson, Nelson Report. Thanks for a really comprehensive speech and thanks for the reminder that you have your days constantly enlivened by the Middle East and Iran and all kinds of things that us Asia-types tend to not to – we have that luxury, perhaps.

You made some really interesting remarks about the North Korea policy. Those of us who only get to worry about North Asia I think are – find ourselves worried that we’re – we have the worst of both possible worlds. They are refusing to negotiate their nukes. We are saying because of that, we’re not going to negotiate a cap and a freeze, perhaps. Fifteen years ago, you were in the vanguard of the State Department people working really hard for a forward-leaning North Korea policy with some success. You’d had freezes on the nukes, and you were, as I recall, working on a missile freeze. What’s the difference then and now that we are not willing to try to cap the threat of proliferation and continued development? Why are we not doing that? Because we know they’re not going to negotiate their nukes, per se. That – it just – that confuses us.

Perhaps you can clear that up, and then just quickly on the – you mentioned the economic reform program that seems to be underway. Are we going to encourage that and hope for a revolution of rising expectations, perhaps? Or are we going to hold back because of the nukes and continue a stronger sanctions policy? Does that contradict, in a sense, what we’re hoping for in the economic reform? So, the two questions. Thanks.

UNDER SECRETARY SHERMAN: Thank, Chris. Look, the policy that we have towards North Korea is one that we believe in but we also share with our partners, the five parties of the Six-Party process. Obviously, North Korea doesn’t quite share the strategy. And to that extent, we have all said to North Korea we are open to conversation, but the conversation is really about their nuclear program. And there are other things that can be discussed, of course, but at the core is the nuclear program. And China has consistently said that. I think, quite frankly, North Korea is rather irritated with China at the moment because the Chinese have been very clear about that. They have taken some unprecedented steps towards North Korea to make it clear what is expected here. We fully support President Park’s initiative to have bilateral discussions with North Korea. So far, North Korea has not agreed to that. There have been times when the Japanese have wanted and have had bilateral conversations, particularly around the ongoing concerns, which we certainly understand, of their abducted citizens. And we have been quite open to having a bilateral conversation with North Korea as long as denuclearization is understood to be a topic of those conversations.

So I would say that the world has had an open door to North Korea to have talks, but this young leader has decided to take perhaps his father’s and his grandfather’s approach to a new level. It will be very interesting to see what happens this year. As I think everyone knows, the Russians have invited Kim Jong-un to Moscow for VE Day. We’ll see if he comes. We – he’s been invited other places as well. I think the entire world community understands that something has to give here, and that if there is a way to engage North Korea’s leader to deal with the security issues facing North Korea, if he ever wants to see his people have prosperity, that’s what it’s going to take. Because even trying to advance economic reforms inside the country will not get very far if all of the members of the Six-Party talks are putting pressure on North Korea to do what is necessary for the future of its own people.

MODERATOR: In the third row here we have Will Norris.

QUESTION: Thank you. Will Norris. I’m an associate here at the Carnegie Endowment. I had a question following up on your comments about the Asia Infrastructure Bank. I was wondering if you could elaborate a little bit more about a specific role for the United States, particularly if you could talk a little bit more about some of the particular characteristics or standards that you might see both in terms of existing architectural institutional shortcomings, and potentially where you see the AIIB being able to make a positive contribution in the region.

UNDER SECRETARY SHERMAN: Thank you. I’m probably not the best person to give you every crossed T and dotted I on the bank. Under Secretary Cathy Novelli is probably better poised to do that. But in general terms, look, there are standards for development banks and for investment banks worldwide. There are not only banking standards and financial standards, but there are also standards of business practices, transparency, rules of the road, international norms. And we believe that any institution in the investment world has to uphold those standards, and I don’t think, quite frankly, that countries will become part of the bank unless they do, because that kind of transparency and accountancy and verification of what goes on is critical to investors worldwide. Having been in the private sector myself for a decade, I can assure you, as an investor, that’s not someplace I would go looking for money if it did not practice the standard norms that other institutions have to follow.

MODERATOR: Here in the second row.

QUESTION: Hi, Secretary Sherman. John Hudson with Foreign Policy Magazine. Just a quick question on the Iran talks. The latest iteration of hawkish attempts to sabotage these negotiations is a direct appeal to the supreme leader saying that Congress is never going to accept a deal after this President is in office. Can you speak to what a direct appeal like that, how – if that’s helpful to your negotiation work, and how you might try to combat sentiments like that?

UNDER SECRETARY SHERMAN: As you probably will not be surprised, I’m not going to say a great deal. We are in the middle of the negotiation. Whenever one is in the middle of a negotiation, there are lots of voices saying lots of things, both about what’s happening in the negotiation – I find most of those stories amusing more than anything else – and what’s going to happen if you get one, if you don’t get one; what’s going to happen along the way.

What mattes at the end of the day in this negotiation is what the President of the United States has required first – in the first instance of Secretary Kerry, and then of me as leading our negotiating team – and that is that any agreement ensure that Iran cannot acquire a nuclear weapon and that all of the pathways to fissile material for a nuclear weapon are shut down. And that is our objective and that is the metric we have to meet for what we would consider to be a good, durable, and sustainable agreement. And that’s what we’re about.

And should we be so fortunate as to reach it – it’s very difficult, very complicated, very tough – then people will make their judgments. And I think given what the President has set out for us to do, if we are able to do it, the world would judge it as a good thing, that it is the way that will ensure that Iran cannot acquire a nuclear weapon, and no other pathway will get us there.

QUESTION: Let’s get back to Asia a little bit. (Laughter.) One of the things that’s been a hallmark of the new leadership under Xi Jinping was an early trip to Moscow. They had a lot of meetings between Putin and Xi Jinping. And then since Crimea and Ukraine, there – at least there appear to be some opportunistic points where they’re coming together economically and in international relations. What’s your perspective on the Russian-Chinese relationship?

UNDER SECRETARY SHERMAN: It’s a strong one. Not a surprising one at all. These are two world powers, and I would expect that they would engage with each other. The world is not a zero-sum quantity; that prosperity, security should help to rise all boats. And we do not look – this is not, as I said in the speech, this is not about rooting for China to lose or rooting for Russia to lose, or rooting for anyone to lose. It is really rooting for everyone to gain, because if everyone gains, if everyone is a more open society, a more prosperous society where their people are educated, where there are jobs to be had, it will benefit all of us because we have seen in this world what happens when there is devastating poverty. We have all seen what happens when countries are economically on the edge. We have seen what happens when there is great insecurity in the world. It is not only bad for the country in question; it’s bad for all of us.

So do we watch these relationships? Of course. Is there some jockeying? Of course. But at the end of the day, what we care about is rising prosperity and global security.

MODERATOR: Thank you. Can we have a question on Northeast Asia – on the subject of the remarks today? In the second row here. If you have hands up in the back, I can’t see them, so really put your hand up.

QUESTION: Thank you, Dr. Paul. Thank you, Secretary Sherman. Bingru Wang with Hong Kong Phoenix TV. I want to ask about TPP. If you’re going to reach a deal this year, are you concerned that there will be some economic clash since the U.S. and China are both going to set new rules in this area? And more importantly, if no deal could be reached this year, will this be a setback, especially for the U.S.-Japan relation and the U.S. rebalance strategy? Thank you.

UNDER SECRETARY SHERMAN: I am an eternal optimist --

MODERATOR: There you go.

UNDER SECRETARY SHERMAN: -- and I am optimistic that we are going to reach this agreement. And it is going to set a new standard for international trade agreements. And it is going to create tremendous momentum not only for Asia but for the world economy. I think it’s going to be good for everybody – those who are in this round of 12 countries and those who aspire to be part of the Trans-Pacific Partnership. So I’m quite optimistic. That’s not a guarantee, because there are hard issues for lots of countries, but this is really a high standard, high-ambition goal which I do believe is within reach.

I think, as I said, we all have to aspire to the highest standards we can have, because that is how all countries in the world will be able to move forward. There are countries in Asia which want to be part of TPP. When this round is over, we’ll see where we are and what next steps can be taken. This is good for everybody.

MODERATOR: See in the back over – got a question on Taiwan from John Zang.



QUESTION: Thank you, Madam Secretary. John Zang with CTI TV of Taiwan. I have two questions for you. Number one, Taiwan is not talked a lot about – Taiwan is not talked about a lot these days in this town. I would like to ask you to give an assessment of the current status of U.S.-Taiwan relations. Taiwan also wants to join the TPP. What is the prospect from the U.S. perspective? And Taiwan’s opposition leader, DPP chair Tsai Ing-wen, is planning on a visit to the U.S. before the next general elections. What is it that the U.S. wants to hear from her, and what is it that the U.S. wants her to hear from the U.S. side? Thank you very much.

UNDER SECRETARY SHERMAN: Simple questions. (Laughter.)

MODERATOR: Yeah, John.

UNDER SECRETARY SHERMAN: So that’s what I’ll say – I will say part of the reason that Taiwan is probably not talked about as much as it once was is a good sign. It means that Taiwan is stable, is prosperous, has a strong relationship with mainland China, that the concept of one China and the Three Communiques has become a standard, that the economic integration between Taiwan and mainland China is quite so – it is the status quo, that the political issues are worked out over time. In any given moment there are ups and downs between Taiwan and mainland China and Taiwan and the rest of the world, but the fact that it isn’t an everyday point of anxiety and concern about what’s happening cross-straits is a good thing. It means that there is more peace, there is more prosperity, and there is more just life as we know it.

In terms of Taiwan politics, I’m going to leave that to the people of Taiwan.

MODERATOR: We have a question here in the front row.

UNDER SECRETARY SHERMAN: I think that’ll be it.

MODERATOR: This will have to be the last one, yes.

QUESTION: Thank you very much. My question is – I’m not going to --

MODERATOR: Could you identify yourself, please?

QUESTION: Yes. Amal Mudallali with the Wilson Center. I’m going to ask you – I don’t want to ask you about the nuclear talks. I respect that. I’m just going to ask you to put your political hat and talk about the region in light of the political – or the nuclear talks. There is a lot of apprehension in the region about what will happen after a deal with Iran, and there is a fear that Iran’s role in Lebanon, in Syria, in Yemen – this is going to continue as a source of instability. What kind of Iran are we going to see after – do you think after negotiating with them and knowing them? Are we going to see a new Iran with a more positive regional role? Thank you.

UNDER SECRETARY SHERMAN: Let me be really clear about this: There is no grand bargain underway with Iran. The negotiation is about their nuclear program. We are quite well aware of what goes on in the region. All of our sanctions around terrorism, all of our sanctions around human rights, all of our concerns about instability in the region remain, and will for a very, very long time, I am sure, unfortunately. And so we are very concerned about the security and the stability in the region. It’s why Secretary Kerry, who will go next week to be part of the negotiations, will be headed to Saudi Arabia to see King Salman on Thursday, and I will join him for a meeting with the GCC in London on Friday. It is why we are in constant conversation with Israel. It is why the Secretary is in constant conversation with Jordan, with leaders in Lebanon – quite frankly, why we have these discussions about the Middle East wherever we go. When I was in Japan, I met with Middle East scholars. Same in China, I met with Middle East scholars. This is of concern to everyone, in large measure not just because of Iran, but quite frankly, more immediately for a lot of people, the ISIL threat. The two, of course, intersect at some point because Iran isn’t very happy with the ISIL threat either.

But just because Iran may work to stop the ISIL threat and we are stopping to – working to stop the ISIL threat, does not mean in any way we are coordinating our activities. We are very clear-eyed about what Iran is doing in the region, and the nuclear negotiation is just about the nuclear negotiation.

MODERATOR: Well, everyone, please join me in thanking Secretary Sherman for her remarks and her patient answers. (Applause.) Thank you.