After years of rapid economic development and mounting regional clout, China has regarded itself as the preeminent Pacific Rim state if not the world's newest superpower.
Yet in the wake of the Sept. 11 attacks, a major internal reassessment is taking place among elites in Beijing.
Sudden geopolitical changes in Asia, the relative ease with which the US has projected power into Central Asia, and tattered plans to keep Russia and even close military ally Pakistan in a "China sphere" of influence have brought a more realistic assessment of China's global position.
"The speed with which other nations - that China thought it half had in its back pocket - lined up with the US has been a little shocking to Beijing," says a European diplomat here, on customary condition of anonymity.
Sources say that Chinese leaders realize they must place political, economic, and military resources on two fronts: In the far west, where they face terrorism and Islamic radicalism on the Central Asian border; and in the far east, where they face Taiwan - unruly democrats on an island China regards as a renegade territory.
Meanwhile, this two-front challenge comes as China is making a difficult and largely uncharted move toward World Trade Organization (WTO) rules and standards. On Saturday in Qatar, the WTO will formally approve China's membership. Reformers here see entry as a long-term boon. But it will also require much domestic energy and reform in China and possibly unleash destabilization in areas as different as banking and agriculture.
"Even the Chinese don't know what will happen in WTO. It is a risk, and people here have their fingers crossed," says a seasoned European diplomat in a different embassy.
China has for several years been building a new Central Asian coalition. It has extended military and technical help to Uzbekistan, Kazakhstan, and Kyrgyzstan, and last summer signed a friendship pact with Russia. Chinese President Jiang Zemin and Russian President Vladimir Putin at one point were co-leaders of an effort to block the Bush administration's proposed nuclear missile defense (NMD) plan.
Yet, since Sept. 11, Central Asian states have been eager to help Washington battle terrorism, and President Putin has moved Russia closer to NATO and has backed off much of his anti-NMD stance. The US overnight became a supporting partner of Pakistan, a state that China helped with its nuclear and missile programs.
Ironically, perhaps, the Chinese perception of great-power status has in some ways played off Washington in recent years.
When the Clinton administration decided to "engage" China in 1996, President Clinton seemed to do so at the expense of China rivals Japan and Taiwan. His controversial Shanghai speech, known here as "the Three No's" seemed to back away from US support of Taiwan. Beijing took this as confirmation of its own preeminence and rise, some experts say.
By contrast, the Bush administration has reaffirmed the centrality of both Japan and Taiwan in Washington's Asia policy.
Japan is moving quickly toward its first "out of area" military support role since World War II. The US sale to Taiwan of $288 million in jet-fighter parts, and 360 Javelin anti-tank rockets for more than $500 million, was announced in the past week. In addition, several days ago a US defense team in Taipei suggested the US may build diesel submarines for Taiwan.
And despite assertions to the contrary, experts say that this spring's surveillance plane incident, in which China detained 24 US Air Force personnel after a midair collision with a Chinese fighter jet, has not been entirely forgotten in Washington.
"China is not yet a superpower," one senior White House official told the Monitor. "It doesn't help to feed that belief. Japan has the third-largest economy in the world, and is an ally. China's military is not advanced. This is the reality."
Yet if China is scaling back its internal bluster, Beijing is pushing as never before to become the dominant power in Asia. Under Deng Xiaoping, China, always a continental power, began building to become a maritime power as well. Its submarines now chart the ocean floors of East Asia. China has purchased Russian destroyers. In the past decade, China has made enormous claims in the South China Sea (where the spy plane incident occurred), outlining borders that protrude hundreds of miles outward and down past Vietnam toward Malaysia.
China's east-coast ambitions bump up against states such as South Korea, Japan, the Philippines, and Taiwan, all of which rely on the US Seventh Fleet for security.
In the west, creation of the Shanghai Cooperation Organization - led by China and Russia, and including Central Asian states - is China's attempt to gain some control of an area not yet under a NATO or US-led umbrella and that poses genuine security problems, based on Muslim solidarity and separatist tendencies in the Xinjiang region.
Still, "it is one thing to say China has ambitions," says the first European diplomat "It is probably intolerable to China that it doesn't completely control its coasts. For that matter, it is intolerable that it doesn't control the Pacific and isn't the leading power in the world. But it is another thing to have realized that ambition."
"It is natural that every nation wishes to become a great power," says Liu Zinzhi, professor of international studies at Beijing University. "Each wants development, international prestige, and status. But [to] wish is one thing, and reality is another."
At the same time, US-Chinese relations are much improved, at least for now.
US officials were instrumental in China's WTO accession, and last month at an economic summit in Shanghai, President Bush told Mr. Jiang that his first overseas visit since the Sept. 11 terrorist attack was to China, "because I want to show my regard for your country."