ABSTRACT
On issues of strategic importance, China would quickly make concession on short-term gains in order to craft long-term advantages. There are some useful interpretations for arguing reasons as to why China could take such a venture into the region successfully and make regional cooperation a multi-layered system: First, based on China's centralised political system which the central government completely controls, the direction of policy and decision making does not need to be scrutinised by the legislative branch. Second, as competition of economic development mounted in all parts of China, many provinces expanded their economic planning across the border lines to include economic activities with neighbouring countries based upon existing prosperous border trade. Third, China's booming market has been the regional power house of economic dynamism. On the real ground, the two-way trade between China and ASEAN skyrocketed. Fourth, for years, China has also become the financial centre in the region.
