The ASEAN and East Asia Summits: U.S. Walks Softly While China Wields a Big Stick

President Barack Obama led a highly effective visit November 18–20 to Thailand, Myanmar, and Cambodia, where he attended the fourth ASEAN-U.S. Leaders’ Meeting and the seventh East Asia Summit. The robust U.S. presence and relatively disciplined and quiet diplomacy looked strong relative to China’s heavy-handed pressure to convince the ASEAN chair, Cambodia, to again break up the grouping’s unity over the South China Sea dispute. In the end, the United States looked engaged and thoughtful, with the exception of its trade policy, and China won a Pyrrhic victory that dangerously undermined its ability to play a natural leadership role in regional organizations.

Courageous Visits Pay Dividends

President Obama used his reelection momentum to take on critics and courageously go where no sitting U.S. president had tread before, literally. After visiting Thailand, home of the oldest U.S. alliance in Asia, he made historic visits to Myanmar and Cambodia. His three-country visit was the first by a U.S. president focused solely on Southeast Asia.

Obama looked like a leader, building on Defense Secretary Leon Panetta’s earlier visit to Bangkok. He reached out to the king, Prime Minister Yingluck Shinawatra, and the people of Thailand to reaffirm the U.S. commitment to its long and special relationship. Panetta visited just three days earlier to reset and modernize the trajectory of the U.S.-Thailand alliance, which had languished a bit since the military coup in 2006. President Obama took that security-based message and balanced it by emphasizing trade—welcoming Prime Minister Yingluck’s interest in joining the Trans-Pacific Partnership (TPP) trade agreement—and people-to-people ties.

In Myanmar, the president took on critics and restated his perspective that it was time for a U.S. leader to come and encourage political and economic reform. He met with both President Thein Sein and opposition leader and member of Parliament Aung San Suu Kyi, and spoke to more than 1,500 at the University of Yangon, long the hotbed of pro-democracy protests. The administration had waived U.S. restrictions on Myanmar’s imports a few days before Obama’s visit and Obama launched a new $170 million aid program focused on governance and capacity building.

The government of Myanmar released at least 51 political prisoners during the president’s visit, assuaging some anger about an amnesty of more than 500 prisoners a few days before that included no prisoners of conscience. But the real impact was the president’s outreach to the country’s people, who by all reports were inspired by his visit and his calls for rule of law, political reform, and an end to ethnic and sectarian violence. Human rights campaigners did a good job of underlining the risks of visiting and encouraging the White House to emphasize their concerns. In the end, the well-balanced visit could have a long-term impact on promoting democracy and creating momentum for economic reform.

In Cambodia, the focus of the visit was not on bilateral relations, but rather on attending the ASEAN-U.S. Leaders’ Meeting and the East Asia Summit (EAS). The U.S. presence was critical and reassuring, proving the importance of using the president’s time to attend these annual summits even when they are hosted in countries that may not have the independence or political courage to table some of the more controversial issues of the day.

Obama had several important accomplishments with his ASEAN counterparts. Together with the Southeast Asian leaders, he agreed to raise the U.S.-ASEAN relationship to a strategic level and institutionalized U.S. presidential engagement by elevating the annual meeting to a “leaders’ summit.” It had previously been called a “meeting” to avoid committing the White House to an annual event.
The awkward moments for Obama and the United States continued to revolve around trade. The president called for a meeting of the TPP member countries in Phnom Penh, but this only underlined the fact that U.S. geostrategy and trade policy do not sync – only 4 of the 10 ASEAN countries are members of the TPP. Even though Australia and New Zealand were present, the meeting included only 7 of 11 TPP member countries because Canada, Chile, Mexico, and Peru are not part of the EAS.
The other major trade event in Phnom Penh was the launch of the Regional Comprehensive Economic Partnership (RCEP) which had to be scheduled after the official summits to give the only two EAS members who are not part of that agreement, the United States and Russia, time to bundle their leaders onto planes to avoid being excluded while the rest of the region kicked off a 16-member trade opening initiative that includes 3 billion people, nearly $20 trillion in GDP, and the world’s youngest and fastest growing markets.

In answer, the United States, which is allergic to stating a goal of a launching a U.S.-ASEAN free trade agreement (FTA), announced a U.S.-ASEAN Enhanced Economic Engagement (E3) Initiative. The E3 concept is solid and effectively prepares the non-TPP members of ASEAN to build capacity to be able to make a decision to join the agreement eventually, but it lacks the creativity and courage to set a vision for an FTA.

China’s Big Stick Raps ASEAN and Undermines Cambodia

But while the United States stumbled a bit on trade, it was China and Cambodia that came away with real damage.

It has been a very hard year for Cambodia. Its chairmanship of ASEAN occurs at a time when China has overbalanced economic influence on the country. China is Cambodia’s top market and by far its largest investor and source of bilateral economic aid. And China has demonstrated, rather clumsily and overtly, that there is a quid pro quo expected in return for its generosity. The result is that Cambodia has embarrassingly stumbled, first at the ASEAN foreign ministers’ meeting in July and again this week at the ASEAN Summit.

Cambodia tried to publish a declaration saying that ASEAN leaders agreed not to “internationalize” the South China Sea and maritime disputes. At least five ASEAN countries objected, and though Cambodia tried more than once to preserve the language that was demanded by China, the other members forced Cambodia to give up the misguided cause and remove the language from the final declaration.

The episode was destructive and dangerous. China has effectively proven that it intends to sustain passive-aggressive pressure to weaken any unified ASEAN position on the South China Sea. In doing so, it won a tactical victory by using its leverage over Cambodia to eviscerate ASEAN unity. But the tactical success undercuts ASEAN trust in China and undermines China’s longer-term role as a responsible leader in the Asia Pacific. This is not good for anyone—not the United States, not ASEAN, and certainly not China.

The ASEAN leaders leave Phnom Penh wondering, still, what China wants and what it wants to be. This is very uncertain ground, and uncertainty means the emergence of an inherent instability in the region that undermines a solid foundation for regional growth.

If China is willing to play its economic pressure cards so blatantly with the United States, India, Japan, and the rest of the region at the table, imagine where ASEAN countries in general and the Southeast Asian disputants in the South China Sea would be without regional frameworks such as ASEAN and the EAS.

Going Forward

The United States made a good showing with President Obama attending the EAS for the second year in a row, the United States having officially joined only last year. But questions about the United States’ staying power continue to be dominant themes. Most of Asia, with the exception perhaps of China, is concerned about three issues when it considers U.S. staying power in the region: pocketbook, personalities, and politics.

The pocketbook issue raises the question of whether the United States will have the financial stability to sustain engagement. There are real concerns about the U.S. budget deficit, the “fiscal cliff,” and to a lesser degree the potential impact of sequestration, which could automatically cut the U.S. budget by 10 percent starting January 1. President Obama did his best to allay concerns, but the truth is he needs to come back to Washington and cut a fiscal deal with Congress as soon as possible.

There is also a very tangible concern about who will succeed Secretary of State Hillary Clinton, Defense Secretary Leon Panetta, and other leaders like Kurt Campbell, the assistant secretary of State for East Asia and the Pacific and key architect of the U.S. rebalance toward Asia. Having Clinton fly directly from Asia to the fires in the Middle East reminds Asia that the conflict in Gaza and the Middle East in general is like a jealous rival, always calling U.S. high-level political focus away from Asia.
Finally, politics: President Obama’s visit was most successful in this area. He told Asian colleagues he is committed to the region. His reelection and the fact that he made his first trip to Asia, including the historic first U.S. presidential trips to Myanmar and Cambodia, assured Asian leaders that he is serious in intent. The proof, as they say, will be in actions such as getting the TPP deal done quickly, sustaining his attendance at the EAS meetings, and funding the U.S. military pivot to the region.

(This Commentary originally appeared in the November 21, 2012, issue of Southeast Asia from the Corner of 18th & K Streets.)

Ernest Z. Bower is senior adviser and chair for Southeast Asia Studies at the Center for Strategic and International Studies in Washington, D.C.

Commentary is produced by the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. Its research is nonpartisan and nonproprietary. CSIS does not take specific policy positions. Accordingly, all views, positions, and conclusions expressed in this publication should be understood to be solely those of the author(s).

© 2012 by the Center for Strategic and International Studies. All rights reserved.

Ernest Z. Bower