Balance of Power: China’s Long Game

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China is slowly winning the long game in Southeast Asia. As the Trump administration sends mixed messages about its commitment to the region, China is wooing more and more countries with a mixture of investment and trade.

Take this weekend's summit in Manila. Regional leaders seemed content to set aside tensions over Beijing's claims in the South China Sea, noting “improving cooperation” over the disputed waters.

The better mood coincides with China's push for Asian nations to conclude a trade deal by the end of the year that excludes the U.S. It comes just months after Trump provoked deep irritation in the region by pulling out of a separate trade agreement that was in the works for a decade. His administration has also put Indonesia and Thailand on a trade abuse watch list.

That gives an opening to President Xi Jinping, who has often spoken of China's return to great power status. Trump has been unusually lavish in his praise of Xi in interviews for helping him on North Korea. But he will also have to get used to China chipping away at America's post-war military and economic dominance in the region.

Balance of Power: China’s Long Game
Xi Jinping, China's president, speaks during the opening plenary session of the World Economic Forum annual meeting in Davos on Jan. 17, 2017.
Photographer: Jason Alden/Bloomberg

Global Headlines

U.S. Congress cuts deal to avert shutdown | Republicans and Democrats came together late Sunday on a $1.1 trillion deal to fund the U.S. government through September. The big loser: Trump, who came up mostly empty-handed as Democrats blocked border wall money, domestic spending cuts and regulation rollbacks in the bill. Trump landed $15 billion more for military spending. He also won $1.5 billion for border security, but the bill explicitly prevents it from being spent on the wall or more customs agents.

A Brexit dinner debacle? | The head of the European Commission said he's “ten times more skeptical” that a Brexit deal can be reached after a dinner with Prime Minister Theresa May last Wednesday, according to the Sunday edition of Germany's FAZ newspaper. Jean-Claude Juncker felt that May showed no willingness to compromise at a two-hour talk in Downing Street, according to the paper.

McMaster differs with Trump on Korean missile defense | Military officials don’t usually disagree with their president in public, but Trump’s national security adviser did just that yesterday. H.R. McMaster said that he told his counterpart in South Korea that Seoul won't be asked to help foot the bill for a $1 billion U.S. missile defense system. That came after Trump said last week that South Korea should pay for some of it.

U.K. slams Facebook, Google and Twitter | The government warned the three social media giants to improve the monitoring of extremist content. Lawmakers said in a report published today that the companies are “shamefully far” from doing enough to deal with illegal and dangerous material. They want Home Secretary Amber Rudd to consider legislation that would make the hosting of such material a criminal act.  

Le Pen's euro dilemma | Marine Le Pen spent the weekend changing her mind about one of her key election pledges. On Saturday she delayed her plans to take France out of the euro until next year. But on Sunday she insisted she would start talks on leaving the currency bloc immediately upon becoming president. Most opinion polls still show centrist Emmanuel Macron beating her by a margin of around 60 percent to 40 percent in Sunday's final round.

Tehran mayor emerges as contender | Mayor Mohammad Baqer Qalibaf led the conservative charge against President Hassan Rouhani in Iran's first presidential debate on Friday. While cleric Ebrahim Raisi is widely thought to have the Supreme Leader's backing, Qalibaf was the most vocal in his attacks and has emerged as the “key challenger” to Rouhani, said Ariane Tabatabai of Georgetown University. The election is May 19.

And finally... Check out Bloomberg's Trump Tracker for the latest news on 45th president's administration.

Balance of Power: China’s Long Game

To contact the authors of this story: Andrew J Barden in Dubai at, Rosalind Mathieson in Singapore at