Asia Policy Under Scrutiny

The United States must act on trade and other issues to demonstrate leadership in the region, analysts say.
Parameswaran Ponnudurai
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Some of the leaders at the East Asia Summit in Hanoi, Oct. 30, 2010.

2011 will be a crucial year for U.S. policy in Asia.

From the White House to Foggy Bottom to Capitol Hill, there will be intense debate this year on political, security, economic, and trade issues which will determine Washington's influence in the region.

The discussions come amid reports that President Barack Obama is preparing to revamp his Asia team and as Republicans take control of the House of Representatives with a vow to shake up his foreign policy by, for example, seeking efforts to hold China more accountable for its actions.

Washington will have two rare opportunities this year to demonstrate leadership in  Asia.

For the first time since its 2005 launching, the United States will take a seat at  the annual East Asian Summit, a critical forum that includes the 10 Southeast Asian nations plus China, Japan, South Korea, India, Australia, and New Zealand.

Obama will be joined by Russian President Dmitry Medvedev in their debut at  the talks to be hosted in October by Indonesia, which will also assume the rotating leadership of the Association of Southeast Asian Nations this year.

The summit can become the cog for regional integration, including turning the region into a giant free trade area.

In November, Obama himself will host the Asia-Pacific Economic Cooperation (APEC)  summit in his home state Hawaii.

Free trade area

Ahead of the APEC summit, the United States is holding negotiations with several other economies that could see the launching of a Trans-Pacific Partnership to set the pace for an ambitious APEC-wide free trade area.

Can the United States step up to the plate and show leadership?

Some in the region are skeptical as the United States looks distracted by internal  politics and is preoccupied fixing its economy, ravaged by the worst financial crisis in decades.

"We see a wounded America. It is still powerful but has weakened economically, politically, and in ‘soft power’ terms," said Simon Tay, chairman of the Singapore Institute of International Affairs, a think tank.

He said that much of America feels it has been harmed by unfair trade and job losses to Asia ,and that the mood of the American voter is turning against trade and globalization, and, potentially, against the region.

"If this continues, it is likely that Obama or his successor will turn inward, and any American engagement with Asia will be purely framed in terms of America’s narrow self-interests," Tay warned.

Swift U.S. action on issues over trade, a key priority in the growth- and export-driven Asian nations, is going to be crucial to remove the smeared American reputation in the region.

South Korea agreement

A top priority for Obama is to get the U.S.-South Korea Free Trade Agreement, which has been gathering dust for more than three years, approved by Congress.

While many of Obama's Democratic party lawmakers oppose the deal, newly empowered  Republicans who have tended to support trade-opening deals are eager to get it passed.

A revised agreement reached with Seoul in December following re-negotiations on auto provisions is expected to begin the process of congressional ratification this  month. Once submitted, Congress has 60 days to ratify the agreement.

The implementation of the trade deal with South Korea will help Obama reach his goal of doubling U.S. exports by 2015 in a bid to contain rising unemployment at home.

It is also expected to spur a U.S.-backed Asia-Pacific trade pact.

The Trans-Pacific Partnership or TPP for now has four signed-up countries, Brunei, Chile, Singapore, and New Zealand, but five others are in talks to join the group: the United States, Australia, Malaysia, Peru, and Vietnam.

They hope to reach a deal by the time the United States hosts the APEC summit, to be attended by leaders of 21 economies accounting for more than 50 percent of world trade.

In addition, Japan, whose powerful agriculture lobby has been preventing the lifting of import barriers, is debating the prospect of joining the TPP.

Foreign Minister Seiji Maehara, who was in Washington last week, called the TPP pact “the most concrete pathway visible” to help realize a Free Trade Area of Asia-Pacific, a goal that was agreed to at last year’s APEC summit.

Business ties

After big losses suffered by his Democratic party in congressional elections, Obama is also moving rapidly to strengthen ties with business, some of whose leaders had questioned the president's commitment to free trade.

On Thursday, he appointed former commerce secretary William Daley, a Chicago political operative turned financier, as his chief of staff.

The appointment heralds a major reshuffle of the senior White House staff, including National Security Council Senior Director for Asia Jeffrey Bader, who is expected to leave sometime after Chinese President Hu Jintao's visit to Washington this month, Foreign Policy magazine reported.

Deputy Secretary of State Jim Steinberg, a leading Washington decision-maker on Asia policy, also has been rumored to be leaving the State Department for a long time now, the magazine said. Several other senior officials are also tipped to exit the scene.

Still, the Obama administration had a "relatively good year" in Asia in 2010 — "relative, that is, to its disastrous first year," said Daniel Blumenthal, an Asia expert at the American Enterprise Institute.

"They stood up to China's bullying in the South China Sea," he said, citing Washington's assurance to back up small Asian nations who felt threatened by China as the Asian giant stamped its sovereignty over the Spratly Islands and adjacent waters.

Other Asia policy successes, Blumenthal said, were U.S. moves to review its export control framework for India and to promote more business-to-business ties with the world's most populous democracy, as well as a number of US agreements with Indonesia to help both trade and defense relations with the world's most populous Muslim nation.

"Wobbly" on North Korea

But he criticized the Obama's administration's handling of North Korea's November attack on key U.S. military ally South Korea.

Washington backed away from supporting Seoul's tough measures against North Korea and instead favored China-hosted multilateral talks with the nuclear-armed nation.

The Obama administration "seems ready to go wobbly on North Korea, and in the process China," Blumenthal said. "This is the worst of the bad habits in Asia we must break."

Obama is expected to face a tougher Congress, especially over China policy.

The new Republican-led House of Representatives foreign affairs committee chairwoman Ileana Ros-Lehtinen said a "fundamental change" was needed in U.S. foreign policy, including re-listing North Korea as a state sponsor of terrorism.

"We should stand with our allies and isolate our [enemies]," she told the Washington Post. "Not the other way around."


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