Asian Concerns over Trump
By Fraser Cameron, Director
28 November 2016
Like Europe Asia was stunned at the victory of Donald Trump. Asian leaders were planning on continuity of US policy with Hillary Clinton, one of the architects of the US pivot to Asia, in the White House. Now everything is in the air and uncertainty, whether in security or trade or human rights, reigns supreme.
During the campaign Trump castigated America’s allies (Japan and Korea) for not doing enough for their own defence; and castigated China for its unfair trade and currency policies.
It was this concern about one of the pillars of the post-war system that hastened PM Abe to New York just a week after Trump’s election victory to seek assurances from the President-elect. Abe said he had established a trusting relationship with Trump who later confirmed there would be no abandonment of allies in Asia.
But Trump did keep his word on TPP stating that US withdrawal from the tortuously negotiated trade deal involving several Asian countries would be the first priority on day one in the White House. At an APEC meeting in Lima, New Zealand PM John Keys jokingly said that they only way to keep TPP would be to rename it the Trump Pacific Partnership!
But Trump won the election playing to American concerns about free trade, blasting NAFTA and unfair trade deals with China as well as TPP. How he proceeds in office on the trade front will be of major importance to Asian countries as many have the US as their top trade partner. Meanwhile many Asian countries are considering joining the Chinese led RCEP trade negotiations as well as Beijing’s plans for the Free Trade Area of Asia and the Pacific (FTAAP).
As well as the death of TPP Trump has also signalled the demise of the transatlantic trade deal (TTIP) that was already struggling to stay afloat. Growing protectionism is hardly likely to raise living standards whether in the US or Asia. But how long before Trump can afford to make a U turn?
For the past half century US alliance arrangements across the Pacific provided security for trade and a conducive environment for a massive boost in economic growth. But by questioning the alliances with Japan and Korea, and even hinting that it would be of little consequence if these countries developed nuclear weapons, Trump was challenging decades of US security policy. As President-elect he has sought to reassure Tokyo and Seoul that there would be no reduction in the US commitment but the genie is out of the bottle. One positive development is that Japan and Korea have decided to cooperate more on intelligence as regards the DPRK. Another unknown is how Trump will deal with the erratic President Kim.
Apart from the election of Trump it is the election of President Duterte in the Philippines that has led to uncertainty. He has been vocal in criticising the US for questioning how he deals with drug traffickers; and he made a surprise trip to China to deepen economic and trade relations while putting aside differences over the South China Sea. This may be an attempt to play the major powers off against each other but it could have damaging consequences.
It has also led to a reduced role for ASEAN, an organisation that the Philippines will chair next year. There is a planned follow-up in November 2017 in Manila to the US-ASEAN summit in Sunnylands that Obama hosted in February this year. But will Trump attend? It is difficult to imagine him giving the same attention to ASEAN that Obama did.
And how will Trump deal with China? He is unlikely to follow through on threats to impose 45% tariffs on Chinese exports as this would hurt the US and go against WTO rules. He is more likely to try and go for a grand bargain whereby the US would tone down or refrain from criticising the internal political system and China would tacitly accept the continuing US security role in the Pacific.
The uncertainty in Asia is mirrored in Europe where EU leaders are scratching their heads at the implications of a Trump presidency for relations with Russia, Syria, Turkey and the Iran nuclear and the Paris climate change agreements. It will be a bumpy ride.