The Political Economy of China’s Periphery Diplomacy in the New Century

　　ABSTRACT: This paper argues that China’s periphery strategy achieved high progress through balancing security cooperation and economic growth in the new century. Firstly, it examined the status of periphery policy in China’s international strategy and foreign relations, and pointed out that China’s periphery diplomacy was united by principles and policies. Secondly, it explored how trade and investment interacted with security cooperation and regional cooperation to improve China’s periphery strategy through the case of China’s trade with Asia and “going out” strategy in Southeast Asia. It argued that institutional building in the China-ASEAN Free Trade Area and the Shanghai Cooperation Organization significantly enhanced the economic relationships with Southeast Asia and Central Asia. Furthermore, deep economic interdependence added to China’s periphery diplomacy. Thus, the author concludes that the relationship between China and its neighbors has entered into a new ear of balance of interdependence.