In this ambitious and authoritative study, David Denoon lucidly documents the significant economic and strategic developments that have taken place in Asia since the “Asian financial crisis” of 1997. Although the dramatic rise of China and India make both central players in the unfolding geopolitical and economic drama, and while Denoon meticulously gives each its proper due, he also places each country's emergence in its proper historical perspective. He compellingly argues that although power and economic influence are shifting away from the “Asian Pacific Rim” (which includes states as diverse as Japan, South Korea, Taiwan, the Philippines, Indonesia, Malaysia, Singapore, and Thailand) and toward the two continental Asian powers (China and India), this does not mean that the Asian Pacific Rim countries are without any requisite power or influence. Rather, Japan, South Korea, a number of South East Asian countries—including Indonesia, Malaysia, and Thailand, as well as regional organizations like ASEAN (Association of Southeast Asian Nations) and APEC (Asia Pacific Economic Cooperation)—are still active players in shaping the unprecedented economic and political restructuring and realignments taking place in the region and beyond.

In placing the “rise of China” and India within the broader context of the Asian region, Denoon provides a useful antidote to the proliferation of China-centric studies that unduly exaggerate the implications of China's rise. He also underscores the pitfalls of looking at the vast and complex Asian region through such narrow lenses. He correctly notes that the preoccupation of policymakers, scholars, and the media with China (and, more recently, India) has prevented them from adequately appreciating the deeper and more subtle patterns of change taking place in the Asian region (which, we are reminded, is made up of some 21 countries), as well as the implications of this change for the rest of the world, particularly the United States.

The author makes his case convincingly in six well-organized chapters, each supported with cogent analysis and a wealth of relevant data. For example, in Chapter 2 which provocatively asks, “Why Was the 1997 Crisis So Severe?”, Denoon not only masterfully discusses the nature, magnitude, and impact of the crisis but also provides a rich and textured analysis of the way in which the divergent political economies of the affected countries made the crisis more prolonged and severe. In fact, in a few tightly argued pages, he incisively chronicles the anomalies of the celebrated “East Asian model,” showing how what was once considered the model's inherent strengths also turned out to be its Achilles' heel. However, most intriguing and ultimately persuasive is Denoon's claim that the Asian financial crisis has served to dramatically restructure the postcrisis economic, political, and strategic environment within the region. Specifically, the depth and severity of the crisis proved to be such a wrenching shock that it has resulted in slower growth rates in most of the Asian Pacific Rim countries. Moreover, the failure of the multilateral financial institutions, such as the World Bank and the International Monetary Fund and regional organizations like ASEAN and APEC, to respond effectively to the crisis has eroded their influence and legitimacy and made them less relevant, heightening “the importance of bilateral ties within the region, increasing the influence of China, Japan and the United States” (p. 16).

Chapter 3 again asks a pithy question: “Is the Current Recovery Sustainable?” Drawing on a wide array of available data, Denoon concludes that “there are fundamental reasons to expect that China and India can maintain high economic growth rates in the near future…. [T]he Asian Pacific Rim countries, on the other hand, face a series of generic and specific problems, which are likely to keep their growth rates lower” (p. 78). Indeed, the author's assessment has been vindicated even under the most unprecedented of circumstances—the subprime-induced global financial crisis of 2008. Both China and India have been relatively unscathed by the crisis, while Japan, South Korea, and the South East Asian countries have been hit hard. Yet, rather surprisingly, an issue that does not receive sufficient attention is the implication of the “global imbalance”—the huge current account deficits and surpluses that built up in the global economy starting in the late 1990s—with the U.S. and other advanced economies building up large deficits, and China, Japan, and other Asian economies building up huge dollar surpluses.

The reasons behind this imbalance are well known. If in the mid-1990s, Asian economies were significant importers of capital by borrowing abroad to finance their ambitious development, in the aftermath of the Asian financial crisis, they made a sharp volte-face. Cognizant of the fact that an absence of foreign hard-currency reserves had made them vulnerable, they began to protect themselves (taking the IMF's advice) against future crises by amassing huge war chests of foreign assets. This development, and its broader implications—including the American allegation that China practices deliberate exchange-rate policy manipulation—could profitably have been discussed.

Chapter 5, on “Strategic Realignments in Asia,” and Chapter 6, on “U.S. Policy and Asian Realignments,” provide a nuanced reevaluation of the region's multifaceted security and strategic complexities. Denoon seamlessly assesses the patterns of realignment by organizing the region's “power hierarchy” and “military balance” in a distinctive and coherent conceptual framework: 1 Superpower: United States; 2 Rising Powers: China and India; 2 Uncertain Giants: Japan and Russia; 2 Cold War Foes: South and North Korea; 2 Humbled Tigers: Taiwan and Indonesia (p. 115). He astutely illuminates the various realignment scenarios and how they “could plausibly produce a shift in the strategic balance favoring the Asian continental powers, India and China” (p. 127). If such a development were to come to pass, “a wide variety of strategic combinations could potentially develop in Asia,” although he maintains that “four main directions seem most plausible: (1) continued American dominance [at least in the short term], (2) U.S.-Japanese-Indian leadership, (3) Chinese preeminence, and (4) an Asian concert of powers” (p. 151).

Denoon aptly notes that Chinese preeminence “is the likely result in Asia if the United States reduces its presence and Washington does not participate in some new alliance,” but that “an Asian concert of powers would be another direction that events may take if neither the U.S.-Japanese-Indian coalition nor Chinese preeminence gains wide acceptance” (pp. 153–54). Again, Denoon's dispassionate and evenhanded appraisal is a sobering corrective to the numerous China-centric studies that have already blindly (and prematurely) concluded that China is, or will emerge as, the unchallenged hegemon in the region.

This book is a significant achievement. It is an eminently insightful, engaging, and readable text, and it should be essential reading for all who want to understand contemporary Asia and its possible future trajectories.