Robert Gates Says China’s Xi Has Firmer Grip on Army Than Hu Did

Gates Says China’s Xi Has Firmer Grip on Army Than Hu Did

Chinese President Xi Jinping has greater control of the military than his predecessor did, and that increases the need for a strong White House relationship with him, former U.S. defense secretary Robert Gates said.

Gates, 70, said in an interview yesterday that former president President Hu Jintao “did not have strong control” of the People’s Liberation Army. The “best example,” Gates said, was China’s rollout of its stealthy J-20 fighter jet during a visit he made in January 2010. The event seemed to catch Hu unaware, Gates said, recounting a story in his memoir “Duty,” which is scheduled to go on sale today.China posed few crises for Gates during his four and a half years as defense secretary. Tensions have grown since the Obama administration announced plans to step up military and political engagement in the Pacific — a strategy announced after Gates left office — and China stepped up its territorial claims off its coast.

President Xi’s stronger control is “both a good-news and a bad-news story,” Gates said. “Before, when the Chinese did something aggressive or risky, you could say ‘that’s the PLA acting on their own.’”

“Now when they do something like declare” a new air defense identification zone in the East China Sea in November, “you’ve got to assume President Xi approved that and is on board” and not that “this is just the PLA misbehaving or strutting its stuff,” he said in the interview in New York.

Gates said China’s declaration was a “real provocation in the current environment” and “meant to send a signal.”

Xi’s control of the PLA means his relationship with President Barack Obama “matters a great deal, and managing this relationship is going to be a big challenge for both countries.”

No Masking Reality

Gates wrote in his book that years of on-again, off-again diplomatic meetings and military-to-military contacts “cannot mask the reality” that China continues to invest a growing portion of its budget on new military hardware “designed to keep U.S. air and naval assets well east of the South China Sea and Taiwan.”

Last month, a U.S. Navy guided-missile cruiser had a confrontation with a Chinese military ship in the South China Sea, underscoring the rising tensions in the region over China’s new air defense zone. Defense Secretary Chuck Hagel called China’s behavior “irresponsible.”

The U.S. Pacific presence is being countered by a growing Chinese navy that “while far inferior” to the U.S. globally, “could be a serious problem for us in Northeast and Southeast Asia” as it develops “highly accurate cruise and ballistic missile, diesel and nuclear submarines and stealthy fighters,” Gates wrote.

“Beijing learned from the Soviet experience, I believe, and has no intention of matching us ship-for-ship, tank-for-tank,” and “thereby draining China financially in a no-holds barred arms race,” he wrote.

Instead, “they are investing selectively in capabilities that target our vulnerabilities, not our strengths,” Gates wrote.

To contact the reporter on this story: Tony Capaccio in New York at acapaccio@bloomberg.net

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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