By Matthew Goodman & Amy Searight —
President Donald Trump will join leaders from around the Pacific Rim at the Asia Pacific Economic Cooperation forum (APEC) Leaders’ Meeting in Santiago, Chile this November 16 and 17. This trip should be coming on the heels of a presidential visit to Bangkok, Thailand for the November 4 East Asia Summit (EAS) and related meetings, but President Trump appears set to send Secretary of State Mike Pompeo in his place. In Santiago and Bangkok, President Trump and his designee at the EAS will have an opportunity to reinforce U.S. commitment to the region through the administration’s “Free and Open Indo-Pacific” (FOIP) strategy. The APEC summit will likely feature a closely watched bilateral meeting between President Trump and Chinese president Xi Jinping, which could culminate in a “phase one” trade deal.
Q1: What is on the agenda for the East Asia Summit and related ASEAN meetings?
A1: Thailand will host the leaders of the 10 member countries of the Association of Southeast Asian Nations (ASEAN) and their 8 dialogue partners for the annual East Asia Summit (EAS) on November 4 in Bangkok. Over the past decade the EAS has emerged as the premier forum for strategic dialogue in the Indo-Pacific, with leaders from India, China, Japan, the United States, and other regional powers joining their Southeast Asian counterparts for discussion on key regional challenges. The EAS follows a series of ASEAN meetings, including a summit involving the 10 Southeast Asian leaders and ASEAN+1 engagements with ASEAN dialogue partners, including the United States. There is no indication that either President Trump or Vice President Pence will attend the EAS this year. While Secretary of State Mike Pompeo will likely be the president’s designee, no announcement has been made regarding whether Pompeo or another cabinet member will represent the United States at the summit.
Initiatives on trade, the South China Sea, and the “Indo-Pacific” will take center stage at the ASEAN and EAS meetings this year. ASEAN’s signature trade initiative, the Regional Comprehensive Economic Partnership (RCEP), which would create a trade bloc of 16 of the EAS countries representing nearly half the world’s population and over one-third of global GDP, remains stalled over India’s reluctance to grant market access to competitive Chinese goods. Yet substantial progress towards an RCEP deal has been made, and a statement affirming this progress and targeting early next year for a final deal seems likely. On the security side, ASEAN-China negotiations toward a code of conduct for the South China Sea have become mired in ongoing maritime tensions between Vietnam and China. The one major new ASEAN initiative that will be rolled out this year is the “ASEAN Outlook on Indo-Pacific,” which is ASEAN’s way of putting its own stamp on the Indo-Pacific geopolitical construct that has become the centerpiece of U.S., Japan, Australia, and India’s regional strategies.
The United States Chamber of Commerce will host an Indo-Pacific Business Forum in partnership with the Thai government and other business organizations that will be headlined by Commerce Secretary Wilbur Ross. The Business Forum is the first of its kind to be convened on the margins of the EAS, and it aims to bring together U.S. government officials and business leaders from across the Indo-Pacific to highlight U.S. trade and investment initiatives that are part of the “Free and Open Indo Pacific” strategy.
Q2: What is on the agenda for APEC?
A2: This year’s APEC summit will take place in Santiago, Chile and will culminate with the leaders’ meeting on November 16-17. APEC brings together 21 Pacific Rim economies for a series of meetings through the year on a wide range of regional trade and other economic issues. As the host of the 31st APEC year, Chile has chosen four priorities: digital economic governance; global economic integration; inclusive economic growth, focusing on greater inclusion of women and engaging small and medium enterprises; and sustainable environmental growth. Beyond these issues, leaders are expected to discuss APEC’s future agenda, since the organization’s current mandate to achieve “free and open trade and investment in the Asia-Pacific” by 2020, codified in the 1994 Bogor Goals, expires next year. The outcome of these conversations will shape the future of APEC and its role in regional economic relations.
Expectations for the November APEC Leaders’ Meeting are tempered by tensions within the organization’s member economies. Last year’s APEC summit in Papua New Guinea made headlines by failing to produce a joint communique for the first time in the organization’s 25-year history, attributed to intractable U.S. and Chinese differences over trade. President Trump was notably absent from that summit, opting instead to send Vice President Pence in his place. President Trump has confirmed that he will attend the Santiago summit, but any progress towards APEC’s goals will likely be overshadowed by a bilateral meeting between President Trump and President Xi. There is cautious optimism that a “phase one” U.S.-China trade deal will be signed, but deeper competitive forces on trade, technology, and finance limit the prospects of a sustainable détente between the world’s two largest economies. The success of the Trump-Xi bilateral meeting will likely determine the tone of the broader APEC summit and the chances of a successful joint communique.
Q3: How do these meetings advance U.S. objectives in the region?
A3: APEC’s 21 member economies are home to nearly 3 billion people and account for 60 percent of global GDP, and the 18 members of the EAS represent similar numbers. With this large audience, the November meetings provide an opportunity for the United States to demonstrate its commitment to the region in the face of growing Chinese influence there. At the 2017 APEC meeting in Danang, Vietnam, President Trump articulated a FOIP vision as the organizing principle for U.S. engagement. Since then, senior administration officials have expanded on this strategy and pledged to support initiatives that promote its three pillars: economics, governance, and security. Progress has been made towards achieving these goals, notably through the BUILD Act, which doubled U.S. development finance capacity. Still, the overall policy remains vague and incomplete, particularly in the area of trade. Leaders attending the upcoming summits will be looking for further details of the FOIP strategy to signal deeper U.S. commitment to the region.
Any U.S. Indo-Pacific strategy will suffer without a credible regional trade policy. The void left by the U.S. withdrawal from the Trans-Pacific Partnership (TPP) on President Trump’s third day in office has yet to be filled by an alternative vision. Momentum toward finalizing an RCEP agreement in Bangkok that includes China and virtually all of its East Asian neighbors would highlight the U.S. absence from regional trade rulemaking efforts.
The absence of both the president and vice president at the EAS will be a leading headline and will further call into question the commitment of the United States to its Indo-Pacific strategy in a region where the presence of leaders at key meetings is seen as an important indication of interest. President Trump has yet to join an EAS, skipping the summit last year in Singapore and departing from Manila just prior to the kickoff of the summit when the Philippines hosted in 2017. His attendance record stands in contrast to President Obama, who attended five of six summits after the United States joined the grouping in 2011, only missing Brunei in 2013 amid a government shutdown.
Q4: Is the U.S. FOIP strategy getting any traction in the region?
A4: Countries in the region like the concept of the “free and open Indo-Pacific,” and the tough talk on China is welcomed in some quarters. However, there is widespread disappointment in the lack of tangible projects flowing from the strategy to date and a sense that resources are not keeping up with the rhetoric. The Indo-Pacific Business Forum is an opportunity to roll out some new initiatives in infrastructure financing, energy security, and digital commerce—areas that were the focus of Secretary Pompeo’s announcements last year that have yielded only limited results to date.
Moreover, countries in the region are growing increasingly concerned about growing U.S.-China strategic and commercial rivalry. The talk about “decoupling” from China’s economy has created concerns that Southeast Asian economies will be caught in the crossfire and forced to choose between Beijing and Washington. Countries would vastly prefer a U.S. economic strategy focused on promoting trade ties and economic integration across the region to complement the United States’ security presence, which the region continues to value.
Mr. Matthew P. Goodman is senior vice president and holds the William E. Simon Chair in Political Economy at CSIS. Follow him on twitter @MPGoodman88. Dr. Amy Searight is a senior adviser and director of the Southeast Asia Program at CSIS. Follow her on twitter @AmySearight. This piece first appeared as CSIS Critical Questions here.
Matthew P. Goodman is senior vice president and William E. Simon Chair in Political Economy at CSIS, with particular emphasis on Northeast Asia.