Monday, November 09, 2009

Obama's Asia trip sign of US role uncertainty

Business Times - 10 Nov 2009

Obama's Asia trip sign of US role uncertainty

It's part of effort to counter impression from Bush days that US is retreating from region


ONE of the complaints made by officials and pundits across the Pacific, and especially in South-east Asia, during the eight years that ex-president George W Bush was in charge of US foreign policy was that Washington wasn't paying enough attention to the strategic and economic changes that were taking place in East Asia - in particular, to the dramatic rise in Chinese influence in the region.

Indeed, American diplomatic and military energy since the attacks of 9/11 were directed at winning the campaign against terrorism pursued in the so-called Greater Middle East that included the two long and costly wars in Iraq and Afghanistan.

The perception among many East Asians has been that the US was 'underinvolved' in their region during the Bush administration, according to Douglas Paal, vice-president for studies at the Carnegie Endowment for International Peace.

During the few trips that Mr Bush and other US officials made to the region - when they were not being distracted by this or that crisis in the Middle East - the discussion centred on terrorism with regional security; economic issues got short shrift. Hence, the concern in the region, and especially in South-east Asia has been that while 'China was rising, the US was retreating', said Mr Paal, who served as the unofficial US representative to Taiwan as director of the American Institute in Taiwan from 2002 to 2006, during a recent conference at Carnegie.

In a way, President Barack Obama's coming trip to East Asia - with stops in Tokyo, Singapore, Beijing, and Seoul - should be considered as part of an effort by the new administration to counter the impression that the US is retreating from the region and to highlight American commitment to remain engaged.

While Obama administration officials are insisting that they do welcome the growing Chinese role in East Asia and are not being confrontational, they are also stressing that its partners in the region should count on Washington to serve a counter-balance to the expanding Chinese military and economic presence.

President Obama's first stop on his Asia trip will be Tokyo, where he is scheduled to give a 'major address' that will outline his vision of the new American role in the region. The Japanese felt snubbed by former president Bill Clinton (who, during his first trip to Asia, didn't stop in Tokyo), recalled Mr Paal. Hence the Obama visit to Japan should send a message to the Japanese that their country remains the leading ally of the US in the region.

But Mr Obama will be visiting Japan in the aftermath of the recent electoral earthquake that took place there and will be meeting with a new generation of Japanese leaders who, according to Michael Swaine, a senior associate in the China Programme at Carnegie, seem to operate with 'a less reflexive support' when it comes to the US-Japan alliance.

While Mr Swaine doesn't anticipate any major breakthrough during the Obama visit in the negotiations over the Status of Forces Agreement (SOFA) that allows US troops to remain in Okinawa, he expects the Japanese and American leaders to make public statements 'to dampen concerns' that the relationship between the two countries is deteriorating following the change of governments in Tokyo.

From Tokyo, Mr Obama will travel to Singapore to take part in the Leaders Summit of the Asia-Pacific Economic Cooperation (APEC) forum. One of the main goals of Mr Obama's visit will be to strengthen US ties with the Asean countries, according to Mr Paal, who points to an important shift in the US approach to the regional group.

Differences between Washington and the Asean governments over how to handle one of its members, Myanmar, prevented former president Bush from conferring with Asean as a group. But the willingness on the part of the Obama administration to start a process of engagement with Myanmar will make it possible for Mr Obama to have talks with all the leaders in Asean.

One of the main issues on the agenda of these talks will be US concerns that the various plans to form a regional East Asia organisation, perhaps along the lines of the European Union (EU) will be dominated by China in a way that could result in the erosion of US economic and military presence in the region.

But the Obama administration is facing a major dilemma now as it tries to maintain and even strengthen its presence in East Asia while continuing to engage China. The economic crisis, including the continuing high level of unemployment, has made it very difficult to mobilise support in Capitol Hill for new trade liberalisation agreements, especially at a time when many Americans perceive China and other emerging economies as a threat to their jobs and welfare.

That explains why Mr Obama is not expected to promote new trade liberalisation initiatives during the APEC summit and why a proposed free trade accord with South Korea has been languishing in Congress.

Moreover, there is not a lot of optimism in Washington that the imbalances in trade and investment between the US and China as well as other East Asian economies are going to be fixed anytime soon. If anything, while the level of US savings is expected to rise in the coming years, the expectations among some experts - such as Michael Pettis, a senior associate in the Carnegie China Programme, based in Beijing - is that there is not going to be a comparable rise in spending by Chinese households.

According to Mr Pettis, the main reason that the level of Chinese spending will remain low is because Chinese production will continue to be growing faster than household income (as Chinese households are being forced to subsidise unproductive investment in manufacturing).

Mr Obama will probably call for more effort to fix the trade and investment imbalances between the two economies during his visit to China. But as US trade with China expands, Mr Pettis expects that the Obama administration will be facing growing pressure from lawmakers to retaliate against the Chinese - which will create new friction between the two countries.

No 'grand bargain'

At the same time, when it comes to climate change (another policy issue that will be raised during Mr Obama's meetings in Beijing), there is little hope that the two sides will reach a 'grand bargain' before the coming conference in Copenhagen, according to Taiya Smith, a senior associate in the Carnegie Energy and Climate Programme.

Like on the issue of trade, the Obama administration is facing a Congress where lawmakers from both parties are continuing to resist legislation on clean energy and climate change. Indeed, this is just another example of the political constraints operating on the administration as it tries to pursue a more energetic East Asia policy.

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