Regional Leadership Dynamics and East Asian Financial Cooperation: Sino-Japanese Competitive Coexistence and the Development of the Chiang Mai Initiative

Abstract

This paper seeks to illustrate and explain the nature of regional leadership dynamics emerging in East Asia and eventually explore how it has shaped the development of the CMI, one of the most tangible outcomes of recent East Asian financial cooperation. It interprets the emerging regional leadership dynamics in East Asia as Sino-Japanese competitive coexistence, in which Japan and China have coexisted to cooperation for the CMI development to take a better leadership position. It proves that Sino-Japanese competitive coexistence emerged through reciprocal interactions between regional shifting followership and Japan’s and China’s critical strategic actions to secure followership. It argues that Sino-Japanese competitive coexistence has constituted the gradual development of the CMI into the CMIM, but at the same time, it has shaped them as supplementing rather than supplanting the US-led global financial governance system.