"My question is: can China be an effective regional leader when it itself is by and large the most important source of many of the transnational problems that are plaguing the region."
Sure, all it needs is a modernized military and then it can do all the "leading" amongst its neighbors as it wants to.
Nope, all the communists have to do is threaten not to buy US debt instruments, and the traitors in Washington will bow and ask whatcanwedoforya?