South China Sea not top priority for China, say experts

Despite ongoing tension in the South China Sea the contested area is far from China's top priority, say experts.

Professor Yiping Huang speaks at the Australian National University China update, which looks at China's economy. Source: SBS News

Issue over the South China Sea will "wax and wane" as a matter of priority for China, said a leading professor at the Australian National University in strategic policy studies. 

Professor Evelyn Goh told SBS News that China's efforts to transform its domestic economy is much more important, urgent and difficult to address than the South China Sea conflict. 

"Its absolute priority is the business of getting on with economic development," she said.

Professor Goh said this would bring China out of poverty and its developing country status, and more evenly distribute across the country the benefits the economic development would bring.

She said this does not mean it would not try to push the envelope when the opportunity arises in the short term though. 

Rather, she said it cautions against interpreting China's "temporary moves as a kind of big strategic push to take over the South China Sea".

The economic focus

Professor Goh said China still needs to have a stable and peaceful neighbourhood to concentrate on developing its economy and better distribute growth to benefit in the medium to long term.

However, its challenge is to transform itself as a production economy in many sectors to one with a well developed internal market that better balances being a consumer rather than a producer.

Economist Yiping Huang from Peking University agreed and said China needs to move beyond it's middle income economy.

"Chinese economic development is not only important for China, but for the rest of the world," Professor Huang said, speaking at this year's Australian National University China update. 

He said China contributes, on average, one third toward global economic growth, and if it could not grow it would lower global growth.

"It’s still above its growth target of 6.7 per cent, at 6.5 per cent, but it might be challenged (and) this is why the government is focusing on a reform program.

Fellow professor from the University of Melboune Ross Garnaut said China's new economic model, which moves away from industries and towards consumption, will gradually increase in scale and play a significant role in Australia's prosperity. 

"I think it's important to get (China's) priority stuck in reform," he said. 

"That might lead to slower growth in the short term but better growth in the long term."