US President Joe Biden may find it difficult to unite Asian “swing states” in a coalition against China, a political analyst told CNBC.
Part of that challenge stems from Biden’s promise to rebuild the American middle class – which could hamper efforts to advance Asian countries’ economic and trade policies, said James Crabtree, professor at the Lee Kuan Yew School of Public Policy in Singapore.
“What the US has traditionally done is try to use both its security and its economic power to lure allies into its camp. For example, it signed the original TPP trade deal,” Crabtree said Friday across from CNBC’s Street Signs Asia.
TPP refers to the Trans-Pacific Partnership, a trade pact negotiated by former President Barack Obama and eleven other countries – most of them in the Asia-Pacific region, excluding China.
The reality is that America’s economic weight is decreasing, China’s is increasing. And China is doing a pretty good job of stealing America’s clothing as a protector of free trade in the region too.
The agreement in its original form would have been the world’s largest trade agreement, covering nearly 40% of the world economy. This would have strengthened the US’s strategic role in the Asia-Pacific region and offset China’s growing political and economic influence in the region.
But the agreement was widely criticized in the US and never approved by Congress. Critics – including former President Donald Trump – said the TPP would accelerate the decline of U.S. manufacturing and hurt American workers.
Trump pulled the US out of the deal in 2017, and the remaining 11 countries renegotiated and signed an agreement that was renamed Comprehensive and progressive agreement for the Trans Pacific Partnership (CPTPP).
Domestic pressures could continue to challenge the Biden government’s attempts to close deals that would attract the region’s major exporters.
“Biden has promised trade and economic policies that will only benefit the American middle class,” said Crabtree.
“If he actually does that, it will be much more difficult to make economic agreements with … the big Asian exporters who are the swing states against China. It is much more difficult for the US to form a broader alliance against China move, “he added.
China’s growing influence
In recent years, China has expanded its influence in the Asia-Pacific region as the US appeared to be pulling out of the region under Trump’s leadership.
An important development that strengthened China’s reputation was the signing of the Regional Comprehensive Economic Partnership (RCEP) – the world’s largest trade agreement without the US that Beijing championed. At the time, some analysts said the deal was a “coup” for Beijing.
There was renewed optimism that the Biden government would reconnect with the world and the region. Early signs point to this direction indeed, and Biden has reinforced his foreign policy team with experts on Asia.
But Biden would have to find “imaginative” ways to reinvigorate US leadership in the region, Crabtree said.
“The reality is America’s economic weight is decreasing, China is increasing. And China is also doing a good job of stealing America’s clothing as a protector of free trade in the region,” he said.
“The big question is, will they go back to the TPP? I think a lot of people in Washington think they should – but politics is so difficult it’s not clear if they can.”