China advances, US retreats in SEAsia

Amid the sound, fury and threats, Asia’s biggest geopolitical winner was China in 2017. This couldn’t have been achieved without the missteps of US President Donald Trump’s administration and the stunning rapprochement between Beijing and Manila.

By and large, China is increasingly seen as the preponderant regional power by a majority of Southeast Asian countries. This is as much a reflection of Beijing’s strategic acumen as a result of the strategic mistakes made by Washington and smaller regional players.

In a short time, China has managed not only to divide and rule the Association of Southeast Asian Nations (Asean), but also leverage the regional bloc as a de facto shield against its strategic rivals, namely the US, and particularly in relation to the South China Sea disputes.

Back in 2013, then newly-installed Chinese President Xi Jinping launched in a high-profile speech his “peripheral diplomacy” initiative which laid out plans for winning over China’s near neighborhood, no easy task considering Beijing’s often treacherous history in the region.

The initiative was an important recognition of growing regional opposition, aided by Washington’s “pivot” to Asia strategy, to China’s growing maritime assertiveness in adjacent waters.

In particular, the Philippines and Vietnam stepped up their efforts at constraining China’s expanding footprint in the South China Sea, while Japan, Australia and Singapore welcomed America’s promised larger military, and especially naval, presence in the region.

In response, Xi called for a strategy that would “promote China’s political relationship with peripheral countries.” It was necessary for China, Xi explained, to “solidify economic bonds” and “deepen security cooperation” with “peripheral countries.”

Four years on, China’s leader is looking at a significantly more auspicious strategic environment.

While the proactive policy has paid diplomatic dividends, it also owes to the dramatic reorientation in the foreign policy of other relevant actors, namely the United States and the Philippines.

Trump’s decision to recast America’s regional policy in what are widely viewed among regional leaders as more isolationist terms has alienated longtime friends and allies alike.

His “America First” emphasis on protectionist economic policies, punitive trade actions and often tempestuous policy pronouncements that are seldom followed with meaningful action have undermined confidence in America’s leadership.

According to a Pew Research survey which aimed to measure global confidence in America’s leadership under Trump’s presidency across 37 nations, there was a 42% year-on-year drop compared to the last year of Barack Obama’s administration.

In Southeast Asia’s largest nation, Indonesia, confidence in the American president’s ability to make good decisions declined by 41%, followed by the Philippines (-25%) and Vietnam (-13%). All three countries have a strong interest in counterbalancing China’s fast rise.

Trump’s decision to nix the Trans-Pacific Partnership free trade pact, meanwhile, has left America with no major regional economic initiative on the table.

In contrast, China has offered multiple regional development programs, ranging from the Asian Infrastructure Investment Bank (AIIB) to the Maritime Silk Road Initiative (MSR) to the related US$1 trillion Belt and Road Initiative (BRI).

It has also supported the finalization of negotiations of the Regional Comprehensive Economic Partnership (RCEP) free trade agreement, which aims to further integrate the economies of 16 nations along the Asia-Pacific rim.

While Trump openly rejected multilateral free trade in favor of bilateral pacts during the Asia Pacific Economic Cooperation (APEC) summit in November, Xi described globalization as an “irreversible historical trend.”

At the event, staged symbolically in formerly isolated Vietnam, Xi underlined his country’s commitment to a “multilateral trading regime and practice” that allows “developing members to benefit more from international trade and investment.”

Indeed, China has deftly leveraged its rising economic influence and America’s perceived retreat into big new stores of geopolitical capital.

This has been most evident in the case of key US strategic allies such as the Philippines, which under President Rodrigo Duterte has welcomed closer economic ties to China in exchange for geopolitical acquiescence.

Duterte has diminished US strategic ties, witnessed in downgraded bilateral war games and rejection of US plans to build facilities at the Bautista Air Base on the island of Palawan that overlooks the South China Sea. The moves have no doubt pleased Beijing and irked Washington.

Duterte’s reorientation towards China, a distinct shift from the previous Benigno Aquino’s more confrontational, pro-US approach, is apparently popular. One recent Pew Research Center survey shows that Beijing is rapidly closing its soft power gap with Washington, even among the staunchest pro-American nations.

Though Filipinos still broadly favor the US over China, the number who prefer stronger economic relations with China has increased from 43% to 67%, the survey shows. In contrast, the number of those who favored a tougher stance against China’s maritime assertiveness has declined from 41% to 28%.

As this year’s rotational chairman of Asean, Duterte openly advocated for a softer stance on the South China Sea disputes, vetoing calls for tougher criticism of China’s massive reclamation activities and militarization of the contested maritime area.

If anything, the Philippines echoed China’s narrative that the “general situation in the South China Sea is positive”, blaming instead “outside parties”, namely the US and its leading Asian allies Japan and Australia, for stoking tensions in the name of freedom of navigation.

The Duterte administration also rejected calls by Japan, Australia and the US to raise its landmark arbitration win in 2016 at The Hague on its South China Sea claims to pressure China into more law-based compliance.

In a blatant rebuff of plans for a larger American military presence in the region, Duterte maintained late in the year that the maritime disputes are “better left untouched” by non-claimant states.

In effect, the Philippines argued that the issue should be exclusively addressed on a bilateral basis, where China has the clear upper-hand.

Rather than taking a cohesive multilateral stand, Asean under the Philippines chairmanship continued to promote long-running negotiations for an elusive binding Code of Conduct in the South China Sea, even if there is little assurance that a substantive agreement will ever be finalized or meaningfully upheld.

Under Duterte’s rotational leadership, Asean effectively handed China strategic impunity in the area. No wonder then this year saw China push ahead with massive reclamation activities across various disputed land features, further tightening its grip on the South China Sea while forging new strategic footholds that will be hard to uproot.

In many ways, Trump and Duterte were the year’s greatest gifts to China’s vision of a fast coalescing Sino-centric regional order.