This means China will offer more benefits to neighboring regions, but with the prerequisite that China has the economic capability to help them. Therefore, the new principle also shows the new leadership's confidence in China's economic development. Stressing moral principles implies China will use the economic initiatives to improve relations with its neighbors.

However, the most important change in China's diplomatic strategy is the new concept of a "community of shared destiny", which symbolizes the upgrading of China's peripheral diplomatic purpose. In the past, it used to delay territorial and other disputes with neighboring countries, and tried to maintain stable relations through economic cooperation that was favorable to its neighbors. That was a rational policy choice during the years of China's fast development because it helped maintain stability and security for over 30 years.

However, as China's economic strength has grown and security conditions have changed, the political gains of economic cooperation have started to decline. For example, some members of the Association of Southeast Asian Nations have shown increasing concern about their over-reliance on China in trade, which in turn has had negative effects on economic relations with China.

A community of shared destiny was first raised by President Xi Jinping during his visit to Indonesia in October 2013, and backed up by Premier Li Keqiang's framework speech in a summit meeting with the leaders of ASEAN countries in the same month. It requires not only intimate economic cooperation, but also mutual trust in security and good intentions towards each other. It proposes raising relations between China and neighboring countries to higher moral standards.

The new principle best symbolizes China's upgrading of its peripheral diplomacy, and the shifting of its diplomatic emphasis with neighboring regions from economic cooperation to comprehensive relations.

Creating a community of shared destiny is now the basis of China's peripheral diplomacy and will support China's development for the foreseeable future.

Chen Qi is a professor and Guan Chuanjing is a PhD candidate at the Department of International Relations, Tsinghua University.