China’s leaders skillfully improved their position and their reception by the Southeast Asians by focusing on the economic dimensions of regionalism. Building on the framework of the ASEAN PlusThree (APT), involving the ten ASEAN countries plus China, South Korea and Japan, the Chinese presented their booming economy, which was attracting more imports from the other twelve, as an opportunity for their economies rather than as a theat. The fear in Southeast Asia was that by attracting foreign investment away from ASEAN countries and by making substantial inroads in to their key foreign markets, such as the EU and the US, China posed too strong a challenge to their wellbeing. However, subsequent studies showed that these fears were misplaced. Chinese diplomacy dwelt on the positive dimensions of their economic relations. In 2001 Premier Zhu Rongji proposed that a China – ASEAN free – trade agreement be reached over a ten – year period. As far as South Korea and Japan were concerned, the Chinese side was able to point out that by 2001 /2002 China (including the through – trade via Hong Kong) had become a bigger market for South Korea than the US and that the Chinese economic locomotive was providing a boost for even the sluggish Japanese economy. It mattered little at this stage, as the magnitude of Chinese investment in and total trade with most of these countries was still below that of the United States and Japan. The Chinese FTA with ASEAN (CAFTA) spurred Japan to respond with its own (bilateral) free – trade agreements (FTAs) and to develop its own institutionalized relationship with ASEAN. What mattered from a Chinese perspective was that the country had largely shed its previous image as a vaguely threatening outsider and had assumed that of an active and fast – growing partner.