Friday October 18, 2019

THE APEC SUMMIT: USA, MIA?

October 8, 2013

On Oct.7-8, world leaders gathered in Bali, Indonesia for the 2013 APEC Summit. While the summit was attended by top leaders from Australia, China, Indonesia, Malaysia, Mexico, the Philippines, Russia, and Vietnam, this year’s meeting was more notable for who did not attend—U.S. President Barack Obama. Obama was forced to cancel his planned trip to the APEC Summit and related visits to Malaysia and Indonesia due to a government shutdown and a burgeoning crisis over the U.S. debt ceiling.

Coverage of the APEC Summit in U.S. media portrayed the meeting as a competition that was “won” by Xi Jinping in Barack Obama’s absence. APEC in this context becomes a battleground between the U.S. and China for influence over even control over the Asia-Pacific region. However, countries in the area have long expressed a reluctance to “choose” either China or the U.S. They much prefer to have both countries active in the region. As a result, Obama’s absence from the APEC Summit is unlikely to sway other Asia-Pacific countries to suddenly support China and reject the U.S. The implications are more short-term and subtle.

APEC is primarily an economic forum, and as such was going to be the forum for Obama to push for the final stages of negotiations on the Trans-Pacific Partnership, which the U.S. envisions as a “high-standard, ambitious” free trade agreement among countries on both sides of the Asia-Pacific. Because China currently would not met many of the standards as put forth in TPP negotiations, many observers have cast TPP as a counter-measure to China’s own free trade negotiations in the region. Without President Obama there to personally push for progress on the TPP, it becomes more difficult to meet the administration’s goal of completing negotiations by the end of 2013. Worse, the political gridlock that caused Obama’s absence raises serious questions over whether or not his administration could secure Congressional approval for the TPP.

Meanwhile, Chinese President Xi Jinping took advantage of his time at the APEC Summit to advance pending free trade agreements with a number of countries in the region, including Australia and South Korea. Xi also used his speech to outline China’s economic vision for the region. Xi stressed remaining “instability and uncertainty” in the Asia-Pacific economy. In this, he echoed the World Bank, which recently downgraded the economic outlook for the region. However, despite a slowdown the Asia-Pacific region is still growing faster than the world at large, providing economic opportunities for all countries.

While many American media outlets analyzed APEC as a zero-sum game, Xi Jinping offered a holistic vision of the region. He expressed China’s support for any and all free-trade agreements, as long as they support cooperation and free trade rather than conflict and protectionism. In developing the Asia-Pacific region, Xi said, countries cannot “step on each other or even work against each other.” Eventually, China hopes to see a “free trade zone” encompassing the entire Asia-Pacific region—a vision not unlike the U.S.’s goal for the TPP.

However, definitions and standards for “free trade” vary wildly, particularly on details such as intellectual property rights. A U.S.-backed free trade agreement is likely to look and operate quite differently than a China-backed agreement. For instance, Xi Jinping called for a free trade zone where developed countries (ie the U.S.) provide “technological cooperation” to help developing countries (including China) “raise their competiveness.” This sounds dangerously close to the sort of forced technological transfers that caused friction between China and the U.S. in the past.  Media coverage suggesting China “won” the APEC Summit is over simplistic, yet Xi’s speech did carry more weight without Obama there to present his own vision for the Asia-Pacific region’s economic development.

Many analysts have already asked what affect Obama’s absence from the APEC summit might have on the U.S. “rebalancing to Asia”. While it might not have serious long-term effects, as discussed above missing the APEC summit makes the economic aspects of the so-called “pivot” more difficult to realize. Unfortunately, this part of the three-pronged U.S. rebalancing was already lagging behind the military and diplomatic initiatives, even though closer economic ties are arguably more important to the U.S. As the World Bank notes, East Asia will remain the main driver behind the global economy for the next several years.

U.S. Secretary of State John Kerry tried to reassure the Asia-Pacific community of the U.S. commitment to the region: “I want to emphasize that there is nothing that will shake the commitment of the United States to the rebalance to Asia that President Obama is leading.”  For their part, Chinese commenters tried express regret over Obama’s absence while not admitting that the U.S. delegation carries abnormal influence at the APEC Summit. When asked about Obama’s absence, China Council for the Promotion of International Trade Vice Chairman Yu Ping replied, “APEC is a big family…no matter which economy is absent, it means APEC is not whole.” Yu also insisted that Obama’s absence “has no direct relation to lessening or increasing the influence of APEC itself.”

In the end, U.S. absence from the region, especially economically, will not lead to a Chinese “victory”, but it will minimize the benefits America gains from participating in the region’s rapidly developing economies. Obama’s absence at one APEC Summit due to pressing domestic issues will not make or break the economic aspect of U.S. rebalancing—but it is a symptom of a larger concern. The U.S. is often too distracted by international and domestic issues to be able to proactively seek its own long-term economic benefit in the Asia-Pacific.

 

For more information on the APEC Summit, please see the following news sources:

 

China Daily“APEC ‘should take lead’ in FTA talks”

China File“Obama’s Canceled Trip to Asia: How Much Did It Matter?”

Huffington Post “APEC Forum 2013: With No Obama, Other Leaders Take Main Stage”

New York Times“Obama’s Absence Leaves China as Dominant Force at APEC”

Reuters“China warns U.S., Japan, Australia not to gang up in sea disputes”

Reuters“China may smother South China Sea agenda at regional forum”

Time “With Snide Remarks Toward U.S., Asia-Pacific Summit Steams Ahead With Free-Trade Deal”

Voice of America“APEC Begins Two-Day Summit”

Washington Post“U.S. not abandoning Asia, Kerry insists”

Xinhua “News Analysis: reliance on APEC to drive world economy increasing”


For Chinese-language analysis of the APEC Summit, please see the following sources:

 

China News (中国新闻)“习近平:亚太经合组织要做好互联互通这篇大文章”

Financial World (金融界)“ 国际社会对习近平出席APEC充满期待”

People’s Daily (人民网)“中国贸促会副长于平:奥巴马缺席与APEC影响力没有直接关系”

Phoenix (凤凰网)“巴厘岛APEC峰会为亚太增添活力”

Xinhua (新华)“习近平在亚太经合组织地二十一次领导人非正式会议上的讲话”

Xinhua (新华) “国际社会高度评价习近平出席亚太经合组织领导人回忆及访问东南亚国家”

Compiled and edited by Shannon Tiezzi