Barack Obama

Beijing suspicious over U.S. regional trade bloc

PUBLISHED : Monday, 14 November, 2011, 12:00am
UPDATED : Monday, 14 November, 2011, 12:00am


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Washington's ambitious move to build a free-trade bloc in the Asia-Pacific region without China's participation has raised Chinese suspicion over what geopolitical objectives the US has in mind to contain the fast-rising power, aside from economic reasons for the bloc.

Analysts say the move also highlights the growing importance of co-operation between the US and China in the region, as well as the growing competition for influence there.

On the sidelines of the Asia-Pacific Economic Co-operation summit over the weekend, US President Barack Obama said he was optimistic a trade pact dubbed the Trans-Pacific Partnership (TPP) could draft a legal framework by next year among nine regional nations.

The nine are the US, Australia, New Zealand, Singapore, Malaysia, Vietnam, Brunei, Chile and Peru. Japan on Friday announced its interest in joining the negotiations.

'The absence of the world's second-largest economy and largest exporter in the TPP talks reflects Washington's objective to dominate the region, which is key to US strategy to maintain its global leadership,' said Lu Hongjun, president of the Shanghai-based Institute of International Finance.

'Just as its confirmed leadership of the Atlantic bloc in the last century meant its domination of global affairs, Washington sees its dominating role in the pan-Pacific region is also crucial to the continuation of its global leadership in this century,' Lu said, adding that the PTT was part of that strategy.

Lu said the US feared China making further inroads into the region, following the launch of the China-Asean free-trade area in 2010, and so some in the US might believe that the TPP could serve to foil China's rising leadership status in East Asia.

'It is an undeniable fact that a US-dominated TPP has implications for regional geo-economics, as well as geopolitics,' Lu said. 'It is also a great challenge for China, particularly because it has been excluded in the initial stage.'

With Europe mired in crisis, the Obama administration saw the fast-growing Asia-Pacific region as a key to achieving promises made during the presidential campaign, particularly of doubling US exports and helping to create jobs and bring down the US' high unemployment rate, Lu said.

'The Obama administration believes that the dynamic Asia-Pacific region is where the US can look for ways to offset the global downtown and continue its global leadership in the coming decades,' Lu added.

Gregory Chin, chairman of the Canada-based China Research Group at the Centre for International Governance Innovation, said: 'The US is looking to strengthen alliances with other economies surrounding China.'

Wang Yong, director of Peking University's Centre for International Political Economy Research, said China was concerned about whether the US was using the TPP to contain China's rise.

Despite the suspicions, several analysts said China was not too worried about the partnership. On Friday, Chinese Trade Minister Chen Deming said Beijing would seriously consider joining the TPP if invited. Hours later, Mike Froman, US deputy national security adviser for international economic affairs, said the initiative 'is not something that one gets invited to. It's something that one aspires to'.

In an indiction that China does not want to be excluded, President Hu Jintao said yesterday that China supported the TPP.

The US has not explicitly ruled out China's entrance into the TPP, but Secretary of State Hillary Rodham Clinton has linked the trade agreement to fundamental values, including openness and labour standards.

The state-run Global Times newspaper denounced the TPP and Clinton's words.


Pacific Rim nations in Apec

- Bloc established in 1989

- Members account for about 40pc of world population