Monday, January 26, 2015

The state of the pivot: A missed American opportunity

Just days after US President Barack Obama delivered his annual State of the Union address, the American public may well have been surprised to find the US leader in Asia, namely India, for a landmark visit following Prime Minister Narendra Modi's trip to the United States last September. Obama's address to the US Congress, after all, said little to nothing about Southeast or South Asia, excluding Afghanistan. And as for the once much discussed "Asia pivot", or rebalance of US foreign policy to focus more on Asia, little has been heard from Obama recently in the midst of a disastrous midterm election for his political party and continued turmoil in Syria and elsewhere in the Middle East.


With the eyes of America upon him, it's understandable that Obama played primarily to a domestic audience and focused on hometown concerns in his penultimate State of the Union address. As I argued in Fortune Magazine, however, that's unfortunate.

Prior to embarking for India, Obama had a chance to put that trip in the context of America's enduring commitment to Asia. He missed the opportunity to further what could still be a hallmark of his now waning administration, namely underscoring to America and to Asia the critical importance of strengthened US-Asia business, educational and cultural engagement.

Indeed, what could have been a "teaching moment" - on the value of strengthened trade and stronger ties with all of Asia - for American viewers as well as those watching from overseas proved to be a bust from an Asian perspective. Full of praise for what the president saw as his own domestic victories, the 70-minute speech said little of America's relationship with the world's most dynamic region, and why Asia matters to all of the United States - Wall Street to Main Street.

From initial words on disengagement - "for the first time since 9/11, our combat mission in Afghanistan is over" (though some 15,000 US troops remain) - to the less than diplomatic - "as we speak, China wants to write the rules for the world's fastest-growing region [and] put our workers and businesses at a disadvantage" - references to Asia in what is typically the most watched presidential speech of the year were limited and brief.

What of a comprehensive trade agreement now being negotiated - the Trans-Pacific Partnership - by the United States and 11 other Asia-Pacific nations? Little was said. The president did call for "both parties [of Congress] to give me trade promotion authority to protect American workers, with strong new trade deals from Asia to Europe that aren't just free, but fair". But then, he quickly moved on, doing little to explain the jargon or to convince sceptics of his commitment to the hard work necessary to move such trade agreements forward.

And what of rising tensions in the South China Sea, as a wary Asia adjusts to a resurgent China, still the world's second-largest economy despite slowing growth rates? The US president was equally brief.

"In the Asia Pacific, we are modernising alliances while making sure that other nations play by the rules - in how they trade, how they resolve maritime disputes, and how they participate in meeting common international challenges like non-proliferation and disaster relief," Obama said before pivoting to the topic of climate change.

What else might he have said? According to the latest data from the East-West Centre, a non-partisan Hawaii-based think tank, Obama could well have underscored to Americans that:

l 28 per cent of US goods and 27 per cent of US services exports go to Asia;

l 32 per cent of US jobs from exports depend on exports to Asia;

l 64 per cent of international students in the United States are from Asia - contributing $14 billion to the US economy;

l 8.5 million visitors from Asia contribute $41 billion to the US economy; and

l 39 states send at least a quarter of their exports to Asia.

To be clear, America's security and prosperity are closely and increasingly linked to Asia-Pacific. The region is home not just to China, but also to two of the world's largest democracies, India and Indonesia, as well as several nations, including Japan, the Philippines and South Korea, that the United States is bound by treaty to defend. Critically, Asia also provides growing opportunities for US trade, investment and entrepreneurship.

That's a point that US Secretary of State John Kerry underscored at a speech at the East West Centre in Honolulu in August 2014. "In the 21st century, a nation's interests and the wellbeing of its people are advanced not just by troops or diplomats, but they're advanced by entrepreneurs, by chief executives of companies, by the businesses that are good corporate citizens, by the workers that they employ, by the students that they train, and the shared prosperity that they create," he said.

Too bad that is a message that Obama chose not to share in his take from Washington on the state of the US union, as Asia looked on. Whether delivered amid a state visit to India or in the hall of the US Capitol building, the critical point remains: America matters to Asia, but Asia also matters to America.

Curtis S Chin is managing director of advisory firm RiverPeak Group, LLC, and a former US ambassador to the Asian Development Bank.

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