THE recent series of dramatic high-level party meetings in Peking is an important landmark along the road of preparing for Deng Xiaoping's eventual successor. These meetings represent an important stage in the process of installing the third generation of China's political leadership. Because many people in this third echelon were trained in the Soviet Union, there has been speculation that the warming trend in Sino-Soviet relations reflects the increased influence of these new leaders. In my view, the lim ited accommodation under way between Moscow and Peking has its origins in other, more fundamental considerations. Most basically, the strategic context has changed from what it was even in the early 1980s -- Peking has come to view the Soviet Union as less of an immediate threat. With the Soviet economy limping along, Russian troops tied down in Afghanistan, proxy Vietnamese troops bogged down in Cambodia (Kampuchea), and problems in Poland and Eastern Europe, China believes that the Kremlin's appetite for further foreign adventure is limited. Increased US military capacity has provided China more room to maneuver between the superpowers.
Peking is also highly motivated to improve Sino-Soviet ties. China's domestic priorities give overwhelming preeminence to economic growth and reform. To maximize economic expansion, Peking has kept a tight rein on military expenditures. Just this year, it announced that it would reduce the size of China's armed forces by 20 to 25 percent. From 1979 through 1983, Chinese military expenditures as a percentage of gross national product dropped by about one-third. As Zhou En-lai and Mao Tse-tung moved
toward the United States in the early 1970s to reduce foreign policy threats to focus resources on domestic political and economic priorities, so in the 1980s Deng Xiaoping is doing likewise.
The Chinese elite also perceives an opportunity in the new Gorbachev leadership in the USSR. The leadership turnover in Moscow, from the demise of Leonid Brezhnev through the death of Konstantin Chernenko, meant that insufficient stability and continuity existed in the Kremlin for a process of limited accommodation to get under way. With Gorbachev's emphasis on domestic economic reform and arms control, the Chinese hope that Moscow will respond.
Economic considerations are important, too. Peking is eager to continue importing goods from abroad. Yet, China's foreign-exchange holdings (which declined about 30 percent in late 1984 and early '85) are enough for only about three months of imports. By boosting exports to the USSR and Eastern bloc and arranging barter agreements that conserve foreign exchange, China can augment its capacity to import and soften the effect of protectionist policies in the US. In addition, the Soviets have recently agre ed to help renovate some of approximately 150 large industrial facilities they built during the 1950s.
Two domestic considerations provide impetus for a limited accommodation with Moscow. Because a disproportionate share of current Chinese and foreign investment is going into China's coastal areas, the western and northwestern reaches of the country have become a clear second priority. With poor transportation links to China's eastern seaboard, leaders in these areas hope to forge closer economic ties to Central Asia, the Soviet Union, and the Middle East. Finally, warming relations with Moscow signal th at China has no intention of entirely shedding the planned character of its economy or uncritically accepting Western values and influence.
Tactical considerations are important in China's calculus, too. Though Washington, Peking, and Moscow all profess to eschew the crude concept of triangular diplomacy, all three have been ardent practitioners of the art. Peking wants to remind Washington of China's diplomatic options when Congress and the executive branch are deciding such issues as nuclear cooperation, American financial support for the United Nations Fund for Population Activities, technology transfer, weapons and military technology s ales to Taiwan, and trade policy.
Similarly, by moving closer to Moscow, Peking hopes to produce more flexibility in Hanoi. As Richard Nixon went to Moscow in 1972 in part to put pressure on Hanoi to end the conflict with the US, so Peking is taking the same route in the mid-1980s.
Because of the diversity of considerations motivating Peking, an improvement in Sino-Soviet relations is likely to continue, if the Soviet Union is modestly responsive. We can expect a further reduction in tensions along the Sino-Soviet border and a growth in the trade, technical, cultural, and educational ties between the two nations. Sino-Soviet trade in 1990 will probably only approximate the 1984 level of America's trade with China. Similarly, in 1984-85, about 14,000 of China's most pr omising students and scholars were in the US, and several hundred American students and scholars were in China. In 1985 about 70 Chinese students were in Moscow and about the same number of Russian students in Peking.
American interests lie in three areas:
Whatever accommodation occurs between Moscow and Peking should not enable the Soviet Union to move sizable military resources to the west to further threaten NATO. Such an occurrence would call into question part of the strategic premise of our relationship with China.
It would be a serious mistake on Peking's part to try to leverage its ties with Moscow into a more assertive posture vis-`a-vis Taiwan. American policy has consistently been based on a peaceful resolution of that issue.
The closer Peking's ties with Moscow become, the more thorny will be technology transfer issues between China and the United States, with technology leakage to the USSR a key concern. In short, the relationship with the Soviet Union represents a tightrope for Peking. American interests are considerable.
David M. Lampton, associate professor of political science at Ohio State University, is an adjunct scholar and director of the China Policy Program at the American Enterprise Institute in Washington.