Donald Trump

Trump plan for arms loans ‘may weaken’ US position in Asia

President’s budget proposal to convert some foreign weapons grants to loans could push smaller nations to find other suppliers, analysts say

PUBLISHED : Wednesday, 24 May, 2017, 12:03am
UPDATED : Wednesday, 24 May, 2017, 12:03am

The United States’ influence in the Asia-Pacific region could be hit by US President Donald Trump’s latest budget proposal that would convert some US foreign military grants to loans, regional observers say.

Some small nations may find it too costly to buy American weapons without assistance and would be more likely to look to other suppliers such as Russia and China, they said.

The White House has already said it would cut spending on the State Department and “other international programmes” by 29.1 per cent, or US$11.5 billion, in the 2018 fiscal year compared to 2017.

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That would include a reshaping of the way some countries receive military aid from the US, by giving out loans rather than grants to buy military equipment.

Nations such as Pakistan, the Philippines and Vietnam are expected to be affected by the move.

Richard Heydarian, assistant professor in international affairs and political science at De La Salle University in the Philippines, said the Trump administration’s de-emphasis on diplomacy and cuts to the State Department budget would have an adverse affect on America’s alliances and leadership across the region.

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US allies in the region had expected the country’s links to the Asia-Pacific would continue no matter who became US president. But Trump has threatened to end the “Pivot to Asia” strategy – a key part of former president Barack Obama’s foreign policy.

“For Trump to scale back the grants, foreign aid and resources of the State Department somehow denigrates the value of diplomatic engagement in Asia and will impact America’s leadership in the region,” Heydarian said.

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Although loan repayment details remain unclear, experts said the move could force some Asian nations – which would find it too expensive to develop or sustain military equipment from the US – to seek military supplies from other sources.

One such country is the Philippines, one of the largest recipients of US military assistance in the Asia-Pacific. However, President Rodrigo Duterte has sought closer ties with China and is now looking to Russia as its new partner for weapons to fight Islamic militants in the southern part of the country. Disagreements with the US over Duterte’s controversial war on drugs have made it difficult to procure weapons from the US.

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According to a study by the Stockholm International Peace Research Institute in February, China is now the third largest weapons supplier in the world after the US and Russia.

However, Rajeev Ranjan Chaturvedy, a research associate at the Institute of South Asian Studies at the National University of Singapore, said it remained to be seen whether China and Russia would start seeing more orders.

“Generally, defence relations are a matter of strategic and political trust,” Chaturvedy said.

“One needs to acknowledge the fact that in buying arms, the country buys not only the hardware, but also software part of it. More importantly, it expects some political support.”

Countries such as France, Germany and Israel were some of the alternative suppliers, he added.

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But as Trump puts a stop to some foreign military grants from the State Department, China is opening its coffers and flexing its economic muscle as it promotes the ambitious “Belt and Road Initiative” to boost investment across Asia.

Chaturvedy said these factors would further complicate the geopolitical situation.

But Zhou Chenming, a military analyst with the Knowfar Institute for Strategic and Defence Studies, a non-government think tank in Jiangsu province, said the US and Russia remained the biggest exporters of weapons and it was unlikely China would see any significant growth in arms sales in the near future.

“It could be more of a symbolic reminder that the United States is this controlling power that is helping other countries rather than a way to make money,” Zhou said.