The changing terrain for Beijing was on view this past week at a conclave of East Asian nations in Cambodia. Wen Jiabao, China's lame duck premier who usually exudes a mild, grandfatherly air, got into a sharp exchange over the contested South China Sea islands. The leaders of the Philippines, Singapore and Vietnam reacted furiously when host Cambodia suggested that all sides agreed not to bring outside parties into the dispute—a reference to the U.S.
Meanwhile, Barack Obama, buoyed by the first visit ever by a U.S. president to Myanmar, projected an image of a confident, friendly America, calling for a reduction in tensions and seemingly taking no sides.
Beijing is struggling to find its feet as its own power grows, but the U.S. refuses to cede influence in the region, emboldening other countries not to fall in with the Chinese line.
"The robust U.S. presence and relatively disciplined and quiet diplomacy looked strong relative to China's heavy-handed pressure," Ernest Bower, chair for Southeast Asian studies at the Council for Strategic and International Studies in Washington, D.C., wrote in a Thursday commentary.
It's a reversal over the treatment Beijing enjoyed much of the past decade as it wooed
China's economic "pull remains, but the smile has faded," said Aaron Friedberg, professor of politics and international affairs at Princeton University.
Getting Southeast Asian diplomacy right matters to Beijing. It's an area where China historically exercised great sway. The 10 countries of the Association of Southeast Asian nations, or ASEAN, are home to a market of 600 million people and straddle vital shipping lanes and seas rich in fish, oil, gas and other minerals.
Beijing's influence began foundering in 2010 when its more assertive claims to islands in the South China Sea touched off anxieties among the Philippines and Vietnam, who along with Brunei, Malaysia and Taiwan also claim the islands in whole or in part.
The fracas provided an opening for the U.S., which as it wound down involvement in Iraq was re-examining the challenge posed by China. The U.S. "pivot" brought renewed diplomatic attention to the region and promises of more military resources.
Still, the friction has only increased. Beijing has become more aggressive in patrolling around the disputed islands, leading to a faceoff last summer with the Philippines over Scarborough Shoal. It is sparring farther afield over other islands with Japan, heightening worries about an expansionist China. It also started issuing new passports featuring a map that shows the entire South China Sea as Chinese territory.
The tensions bubbled to the fore at an annual summit of Southeast Asian leaders in Cambodia's capital of Phnom Penh attended by Obama.
Philippine President Benigno Aquino raised the Scarborough Shoal, prompting Chinese Premier Wen Jiabao to state that the islets have been "Chinese territory since ancient times and no sovereignty dispute exists." China's actions to assert its sovereignty were wholly "appropriate and necessary," Wen told the closed door meeting, according to Vice Foreign Minister Fu Ying.
Wen's stern statement was "destructive and dangerous," wrote CSIS's Bower. "This is very uncertain ground, and uncertainty means the emergency of an inherent instability in the region that undermines a solid foundation for regional growth."
Chinese government-backed experts conceded a failure in execution. "Somehow, the issue was not handled very well in the meeting," said Zhao Gancheng, director of the Center for Southeast Asia at the Shanghai Institute for Foreign Studies.
Economic realities could still work in China's favor, experts say. Chinese imports from the region grew 29 percent last year to $146 billion, and with its economy expected to overtake America's as the world's largest in coming years, China will only grow in importance as a source of overseas investment.
The very fact that China has refused to back off—despite provoking a backlash that could hurt its long-term interests—speaks to Beijing's belief that its economic pull will ultimately convince its ASEAN neighbors that their future lies with China, not with the U.S., said Princeton's Friedberg.
"The big question, I think, is whether the ASEAN states believe that the United States actually has the resolve and the resources to follow through on the commitments that have been made in recent years. If they begin to doubt this they will have to do more to appease Beijing," Friedberg said.