The US and China must avoid ‘competing camps’ mentality


By Stephen Olson

As you listen to the unfolding discussion on the Trans-Pacific Partnership, do not be surprised if you hear as much about geo-strategic competition as you do about trade or economics. In fact, U.S. President Obama himself has been surprisingly straightforward and uncharacteristically devoid of nuance in portraying the TPP as something of a victory in a strategic contest between the U.S. and mainland China to gain the upper hand in setting trade rules in the Asia-Pacific. According to Obama: “If we don’t write the rules, China will write the rules out in that region. We will be shut out.” He then echoed these sentiments at the conclusion of the TPP negotiations: “We can’t let countries like China write the rules of the global economy. We should write those rules … that’s what the agreement reached today in Atlanta will do.” So, seen from this perspective, the TPP is part of a larger competition between the U.S. and China for clout in the Asia-Pacific region. The TPP is intended as the economic component of the broader U.S. “pivot to Asia” — a strategy intended to signal that after more than a decade of Middle East misadventures, the U.S. is “back” in Asia, and will not lightly cede influence to a rising China.

One wonders however if this could prove to be an exercise in closing the barn door after the horse has already bolted. For many of the U.S.’ “partners” in East Asia, China has long-ago supplanted the U.S. as their most important economic partner. And it is unlikely that the TPP will dramatically reconfigure these deeply-etched trade and investment patterns, many of which link to well-established global supply chains. Of course, some trade diversion to countries within the TPP is likely to take place as barriers are reduced, and China’s slowing growth has certainly diminished its demand for commodity imports from its neighbors. But the agreement is not a “game changer” that will fundamentally disrupt or diminish the central role China plays in the region. In short, with or without TPP, China is not going anywhere. Its economic footprint in the region is simply too deep.