Staying Quick on Our Feet To Defend Against the US ‘Pivot to Asia’

The U.S. “pivot to Asia” strategy is now coming to fruition. Having begun its about-face in 2009 with a resounding declaration from Hillary Clinton that “the United States is back,” the world’s last remaining superpower is now showing signs of life in its high-torque maneuver that once looked more likely to break its own ankles.

And with the recent summit between President Obama and leaders of the Association of Southeast Asian Nations having been hosted for the first time in the United States, it is evident that there are yet more twists to come before the final buzzer sounds.

Nine years ago, several Chinese commentators, myself included, maintained a rather dim view of the strategy. The reasons for this were many, but among them was an overly narrow focus upon the employment of U.S. military might. While upticks in military deployments have been broadly recognized as a primary indicator for the pivot, the United States’ “return” is more targeted toward reaping the benefits of regional development and securing its position as the playmaker.

The countries of Southeast Asia are close neighbors to China and have enormous potential for growth. As the global economy wallowed in widespread depression in 2015, the average economic growth rate of ASEAN countries was 4.4 percent, and that figure is predicted to reach 4.9 percent in 2016. Relations between China and ASEAN states have blossomed in recent years, particularly with respect to trade. Meanwhile, the United States has hastened to keep pace through rapidly expanding its regional involvement, contributing a total of $32.3 billion in foreign direct investment to ASEAN countries in the period from 2012 to 2014, a step up on China’s $21.3 billion in FDI. More significantly, Chinese investment has largely been in areas such as infrastructure and mining, whereas U.S. investments have been funneled into light industry, electronics, chemicals and financial services, with a stated emphasis upon the manufacturing sector.

These increases in U.S. investment can be attributed partially to the rising price of Chinese labor and subsequent reconfiguring that U.S. firms have had to undergo, but are also a consequence of strategic adjustments by the Obama administration that have encouraged those enterprises to invest more heavily in Southeast Asia. The flexibility of private capital and a strong technological base are comparative advantages of the United States that have allowed its companies to better optimize their investments, more comfortably delve into technical areas and take on less commercial risk than their Chinese counterparts. Furthermore, China faces challenges even in its own wheelhouse of trade. The Trans-Pacific Partnership was a vital topic of discussion at the recent summit between Obama and ASEAN leaders, and besides the four ASEAN member states that have already signed on, Indonesia, Thailand and the Philippines have also signaled their participation.

Of course, U.S. investment into Southeast Asia has not been entirely detrimental to China. However, the pivot to Asia must be considered as a comprehensive strategy that encompasses political, economic, security and military facets, and that its primary objective lies in addressing China’s rise. Beijing must stay quick on its feet in responding to the pivot and the changes that it will bring, using both reactive and proactive measures to ensure that Chinese investment is timely, targeted and effective.

Minimizing the deleterious effects of the U.S. pivot on Chinese development will be contingent not only upon China’s capacity to resist U.S. military involvement, but also its ability to foster relationships with smaller Asian nations, the 10 ASEAN member states included, to truly form an environment of collective development.

The author is a senior correspondent for the People’s Daily.

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