Asia: Can US see past threat, to opportunity?
When President Trump withdrew the United States from the 12-nation Trans-Pacific Partnership trade deal, he pulled the rug out from under the Obama administration’s much-vaunted but still largely aspirational “pivot to Asia.”
With the stroke of a pen, Mr. Trump made clear what US relations with Southeast Asian nations are NOT going to be – a strategic alliance built on the framework of a multilateral trade and investment partnership with the US economy.
But beyond the symbolism of pounding a nail in TPP’s coffin, little has emerged from the “America First” president about how he envisions business and trade relations with the most economically dynamic region of the globe.
The Trump administration will have the opportunity to start sketching out what will replace President Obama’s Asia pivot, particularly when it comes to economic relations, when the foreign ministers of the 10-member Association of Southeast Asian Nations (ASEAN) meet Thursday with Secretary of State Rex Tillerson in Washington.
And with America’s jilted Southeast Asian TPP partners tempted to look elsewhere for big-power partnership – to China, but even to Japan and Canada, which recently have expressed growing interest in leading TPP into implementation without the US – that “opportunity” is coming none too soon, some regional experts say.
The Southeast Asian countries “will definitely be looking for what [the US] Plan B is,” says Walter Lohman, director of the Heritage Foundation’s Asian Studies Center in Washington.
“Withdrawing from TPP was a blow to our engagement in the region, and it has tempted our Asian partners to contemplate looking elsewhere” for leadership, he adds. “Either we come up with that Plan B to engage the region, or we may risk being marginalized.”
Only four of the ASEAN countries are also TPP members – Brunei, Malaysia, Singapore, and Vietnam – but a number of others, including Indonesia, Thailand, and the Philippines, aspire to membership as their economies conform to TPP standards.
Trump fulfilled a campaign promise and pulled the US out of TPP – signed by the US under Mr. Obama – calling it another in a string of bad trade deals that allowed countries unfair access to the US economy without giving much of anything in return.
But since taking office, Trump has shifted his focus in regards to Asia largely to security concerns and in particular to North Korea’s nuclear threat. He has even told China, which he blasted during the campaign as an economic predator, that it can count on a better trade deal with the US if it acts to rein in its belligerent Korean ally.
The problem is, analysts say, that a sustained focus on security challenges over economic ties to the region could help perpetuate the “unfair” dynamic candidate Trump lambasted whereby the US provides much of the expensive security structure that has allowed the Asian-Pacific to prosper – without reaping a fair share of the economic benefits.
“We’re seeing that the administration is going to stay involved militarily, and we see them defend the right to access to and to navigate the [international] waters,” Mr. Lohman says. “What is needed is a broad-based approach that includes the economic side with the security interests.”
Competition for leadership role
Whether the ASEAN foreign ministers meeting with Mr. Tillerson will get a preview of such a comprehensive Asia policy – essentially Trump’s replacement of the Asia pivot – remains to be seen. But analysts say Tillerson should be mindful that while partnership with the US is highly desirable for Asian counties, US leadership is not the only game in town.
“There is competition for leadership in the region,” says Philip Levy, a senior fellow on the global economy at the Chicago Council on Global Affairs. The region’s smaller countries are wary of China’s increasingly aggressive and expansionist stance on a number of territorial disputes, particularly in the South China Sea, he notes. But that has not deterred them from exploring closer economic associations with the Asian behemoth.
With the US out of TPP, Asian countries see the China-promoted (though less ambitious) Regional Comprehensive Economic Partnership, or RCEP, as the only game in town.
“I think the feeling for many of these countries is that while RCEP is less attractive and less ambitious than TPP, something beats nothing – and at the moment, the US has nothing on the table,” Dr. Levy says.
Even TPP, once thought dead without the US, may have new life. Canada is holding talks this week with partners to see how the remaining 11 TPP countries might proceed, and Japan – the largest economy still in the deal – is expressing interest in keeping the trade pact alive.
In the meantime, advocates of a robust and comprehensive US partnership with Asian Pacific countries say they are seeing signs the Trump administration is looking to move beyond a rocky start with the region.
'Reset' with Australia
Even as Tillerson meets Thursday with ASEAN ministers in Washington, Trump will meet in New York with Australia’s prime minister, Malcom Turnbull, on the sidelines of a commemoration of the World War II Coral Sea battle – a battle (against Japan) that cemented the US-Australia strategic partnership.
The meeting is being portrayed in Australia as a “reset” of bilateral relations after a newly inaugurated Trump had an angry phone call with the Australian leader over an Obama agreement to resettle a number of refugees held in Australian camps.
The Trump administration has since agreed to honor the accord – a sign to some that the president now understands the broader importance of close relations with Australia, a faithful contributor to US-led security coalitions.
“This is all part of them [in the administration] getting their act together and putting things with important partners back on track,” Lohman says. “Australia is one of the more vocal advocates of the freedom of the seas,” he adds, “so I think we’re seeing recognition of their solidarity with us in the Pacific.”
What worries some is that the emergence of a comprehensive Asia policy – whatever Trump envisions to replace the Asia pivot – may take too long for some countries, like the ASEAN states.
“Before, US trade strategy followed a predictable pattern, there was pretty much a template that told partners where we were going and the obligations they’d have to fulfill,” Levy says.
“That’s a template Trump seems to have rejected, but we don’t know yet how he plans to replace it, other than to suggest that he prefers bilateral deals over multilateral arrangements,” he says. “But many bilateral negotiations would take a lot of time, and that could leave smaller counties like in ASEAN thinking they are at the end of a long line.”