U.S. Vice President Mike Pence is in Singapore for regional summits during which he will highlight the Trump administration’s commitment to keeping the Indo-Pacific region free and open, but where leaders will be watching closely what he will actually offer, both on security as well as trade and investment.
Fulfilling a ‘Free and Open Indo-Pacific’
In a briefing to reporters, a senior administration official said the vice president’s visit to the region will unveil “concrete, substantive initiatives” to fulfill the “Free and Open Indo-Pacific” strategy outlined by President Donald Trump in the Asia Pacific Economic Cooperation (APEC) summit in Da Nang, Vietnam, last year.
The strategy focuses on achieving free markets and freedom of navigation in the region, and replaces the Obama-era “pivot to Asia,” a strategic “re-balancing” of U.S. interests from Europe and the Middle East.
Since President Trump pulled out of the centerpiece of that strategy, the massive Trans-Pacific Partnership (TPP) free-trade deal, the perception has been the United States has further withdrawn from its engagement in the region, said Angela Mancini, head of Southeast Asia for the consultancy group Control Risks.
“All eyes are going to be looking to see what’s actually going to be announced this week,” Mancini said, especially on whether the United States will be offering a viable alternative to China’s trillion-dollar investment strategy, the Belt and Road Initiative (BRI). “There’s been a lot of talk around support for infrastructure, but not a lot of money coming in.” she said.
A counter to BRI?
In his October speech at the Hudson Institute, Pence called Chinese President Xi Jin Ping’s Belt and Road Initiative, “debt trap diplomacy.”
In Asia, he will likely highlight the American alternative, the U.S. International Development Finance Corporation (USIDFC), a new agency created under the bipartisan BUILD Act. The new $60 billion initiative supports private investments for infrastructure projects around the world.
The Maldives, Sri Lanka and Malaysia are some of the nations rethinking BRI investments because of problems arising from what critics see as a Chinese debt trap. Beijing denies the accusations that its loans create problems ranging from corruption, labor violations to objectionable debt.
Marc Mealy, vice president on policy at the US-ASEAN Business Council, a lobby group for American companies, hopes the USIDFC will help position the American business community as a “viable and credible alternative commercial partner” for Southeast Asia.
But countries in the region will be looking for concrete proof that the United States is offering a healthier alternative from a development investment perspective, and how can they actually get their hands on those investments.
Angela Mancini noted the U.S. government has “never been known to move quickly” and that one of the benefits of working with BRI has been the speed with which China can deploy funding and resources. She added that many countries are desperate for infrastructure, and it remains to be seen how quickly the United States can actually stand up and operationalize that investment.
US-Sino trade war
One of the issues in focus at the Singapore summits is the trade spat between Washington and Beijing, which has left countries in the region on edge.
“All countries in ASEAN want to see free trade continue,” said Lim Tai Wei, senior research fellow at the East Asian Institute, National University of Singapore, adding countries would hate to have choose between the United States and China.
The U.S.-Sino tariff wars have forced Southeast Asian nations to rethink their business strategy, and there have been winners and losers in different sectors of individual countries.
Countries are also watching the Trump administration’s trade and tariff policies with allies in the region. In Japan, Pence pushed Prime Minister Shinzo Abe for a bilateral trade agreement that President Trump hopes will cut Tokyo’s trade surplus with Washington.
In Singapore, Pence is expected to continue the U.S. bilateral free-trade agenda with several countries in the region, including Vietnam and the Philippines.
This may be at odds with the Association of South East Asian Nations (ASEAN), which prefers to deal with trading partners as a regional block.
ASEAN already has five free-trade agreements with all of the major economies in Asia-Pacific, including China, Japan, India, South Korea and New Zealand. The regional block is trying to bring all five of the individual deals into a single agreement called the Regional Comprehensive Economic Partnership (RCEP) that, if concluded, would constitute more than forty percent of the world’s population.
Marc Mealy urged the Trump administration to consider a regional approach. He said it may be in America’s interests to “really look at doing a US-ASEAN free trade agreement one day.”
Security commitment under “America First”
Aside from trade and investment, many questions remain for the Trump administration’s security commitment in the region, said Lim Tai Wei.
“How is it going to operate? Where is going to put it forces? Is it going to strengthen the relationship with allies? How are they going to resolve the Korean Peninsula issue?,” he said.
Countries are also concerned about U.S.-Sino tensions over Taiwan and rising hostility in the South China Sea, especially in light of a recent near-collision between the USS Decatur and the Chinese warship, Luyang.
Bonnie Glaser from the Center for Strategic and International Studies said Washington’s aggressive rhetoric is heard in in region that the United States is “looking to start a Cold War” while the Chinese is pressuring countries to not side with Washington. Glaser said Southeast Asian countries want to have good relations with both the U.S. and China and some are fearful the Trump administration will compel them to choose one nation over the other.
After representing the Trump administration in the Singapore summits, Pence will head on Thursday to the APEC Summit in Port Moresby, Papua New Guinea.
Chinese Prime Minister Li Keqiang will attend the ASEAN – China Summit and the East Asia Summit in Singapore and President Xi Jinping will be at APEC. Russian President Vladimir Putin will also be going to the summits in Singapore and Port Moresby.
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