Asia Sees China, and U.S., as Threats to Rules-Based Order
(Bloomberg) -- For many U.S. allies, Secretary of Defense James Mattis is the last of the Trump administration’s so-called grownups in the room. So at Asia’s main annual security forum he got a warm reception for his firm defense of the rules-based order the U.S. helped to build after World War II.
Increasingly, though, Mattis’s reassurance is not enough. The U.S. -- as much as China -- is seen as a threat to that system, undermining the very solutions the retired Marine Corps general offered to counter Beijing’s rule breaking in the South China Sea.
On Sunday, tiny Singapore, one of the U.S.’s most like-minded partners in the region, drew a direct equivalence between the U.S. and China. Defense Minister Ng Eng Hen marked the two global powers as nations that “are in fact changing the rules of the international order.”
The U.S. administration’s America First policy of imposing trade tariffs on national security grounds was “but one manifestation” of an attempt to revisit the status quo, in potential breach of World Trade Organization principles, Ng told the Singapore security gathering known as the Shangri-La Dialogue. The U.S. under President Donald Trump has been a frequent critic of the WTO, calling it outdated and too slow to resolve disputes.
With disruption already underway, the real question, Ng told reporters after his speech, was this: “Can countries including China and U.S., especially China and U.S., agree on one rule-based order, which President Xi Jinping said he supports?’’
The challenges presented by China’s rising power and territorial assertiveness predate Trump, as do the solutions Mattis had to offer. But faith in those solutions is fading.
The U.S. strategy Mattis laid out in Singapore has been rebranded to refer to the Indo-Pacific rather than the Asia-Pacific. Yet it was little different from the one his predecessor Ash Carter offered: Conduct freedom of navigation operations to show the international community’s refusal to accept Chinese territorial claims, while maintaining alliance unity – specifically with the Association of Southeast Asian Nations.
In time, China’s misdeeds would generate enough push back and isolation that it would reconsider its actions, Mattis said Saturday in a question-and-answer session. Still, while the Pentagon recently excluded China from this year’s multi-national RIMPAC naval exercise, China’s foreign minister has dismissed the Indo-Pacific strategy as “sea foam,” set to quickly disappear. Some analysts agree.
“Nothing has changed except each year it’s worse,” said Francois Heisbourg, a former diplomat and adviser to the French defense ministry, who now chairs the International Institute for Strategic Studies, the London-based think tank that organizes the Shangri-La conference.
“The effect is that the Chinese are getting what they want, while the Americans insist on giving gifts to the opposition,” he said, referring to the Trump administration’s decision to impose trade tariffs on allies such as Japan, and to abandon the Trans-Pacific Partnership, a trade agreement designed to set the region’s trade rules on U.S. terms.
Some analysts say attitudes toward China are hardening. The potential costs are sinking in of accepting burdensome loans under the Belt and Road Initiative, alongside China’s tactics in the South China Sea and its political meddling abroad, said James Boutilier, special adviser to Canada’s Maritime Forces Pacific Headquarters.
That isn’t yet, however, producing the unity required to isolate China and force it into the kind of recalculation that Mattis foresaw.
The country that has lately shifted its China policy most, Australia, has been frozen out by China, rather than the other way around. Trade Minister Steven Ciobo recently became the first cabinet minister to visit China this year amid a freeze on invitations from Beijing. He went to attend a soccer match and his request to meet with officials was rejected.
“Asean is road kill,’’ Boutilier said of the 10-nation group. He pointed to the Philippines, where President Rodrigo Duterte has distanced his government from the U.S. and made accommodations with China. The Philippine leader and others have noted that the chances of the U.S. actually coming to the aid of the Philippines or others militarily over disputed land features in the South China Sea are remote.
A possible route to providing new substance to the U.S. strategy is a grouping of four significant Asia-Pacific military powers -- the U.S., Australia, India and Japan -- that struggled on launch in 2007 because Australia’s then-government withdrew to avoid provoking China. The Quad, as it’s known, was revived last year as Australia hardened its approach.
Yet neither Mattis nor Prime Minister Narendra Modi, who on Friday became the first Indian leader to attend a Shangri-La conference, mentioned the Quad in their speeches, suggesting they are wary about fueling Chinese suspicions that the U.S. and its allies are seeking to contain Beijing. China denies violating freedom of navigation and has said its Belt and Road Initiative provides win-win solutions for developing countries.
The U.S. may have few better options available in the face of China’s size and economic growth. However, the fundamental flaw in current U.S. policy is money, said Andrew Yang, a former Taiwanese defense minister who heads the Chinese Council of Advanced Policy Studies in Taipei.
‘Hard to Reconcile’
On the one hand, Washington is demanding allies spend more on their own defense and pay higher trade tariffs, said Yang. At the same time, the U.S. is asking them to beware of Chinese largess and risk alienating their largest trade partner. “Those things are very hard to reconcile,’’ he said.
If the U.S. were willing to compete with China in offering large infrastructure investments or buy up debts that countries like the Maldives owe to China, the policy would be more coherent, he said. Yet that would counter the whole bent of the administration’s foreign and trade policies, which are predicated on the idea that other countries must stop taking advantage of U.S. generosity.
A bill now before Congress, the Asia Reassurance Initiative Act, seeks to provide the missing financial link to Mattis’s strategy. It would authorize $1.5 billion annually to “enhance U.S. presence in the Indo-Pacific’’ and encourage the negotiation of bilateral and multilateral trade pacts.
Yet Trump shows little interest in negotiating new multilateral trade deals, while the sums on offer under the bill pale next to Chinese investments. China’s Belt and Road Initiative involves spending as much as $1.3 trillion by 2027 on railways, roads, ports and power grids, Morgan Stanley estimates.
“We will not, should not, try to match China dollar for dollar. But we do need to come up with more creative solutions to help these countries develop, in non-predatory ways,’’ said House Republican Mac Thornberry, who also attended the Singapore conference.
Still, the Texas Congressman thought events were starting to tip in favor of the U.S. and its allies, as concerns over Chinese behavior rise. On a visit to the Philippines, he said he had found people extremely concerned about China, though cautious about speaking out.
“I don’t know specifically where it will lead, but more and more nations who believe in freedom of the seas are coming together and are alarmed at where this is headed,’’ said Thornberry.
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