MANILA – The Joe Biden administration is bidding to win back estranged allies and counter Beijing’s rising influence through two new big initiatives that if implemented as envisioned will more starkly divide the region into pro and anti-China camps.
US officials are now hammering out the details of a major proposed pact on digital services, one that would seek to set rules for cross-border flows of information, digital privacy and artificial intelligence standards in Asia. The pact would explicitly exclude China.
Meanwhile, US Secretary of Defense Lloyd Austin will seek to rally support for the new US Pacific Deterrence Initiative (UPDI), which aims to enhance the Pentagon’s logistical, surveillance and strategic asset deployments to counter China’s growing naval assertiveness. He is expected to lobby for the initiative during an upcoming trip to Southeast Asian capitals.
The initiatives signal that the Biden administration means business and is committed to an alliance-based approach to curb Beijing’s hegemonic ambitions in the region. This is especially true in Southeast Asia, a central theater of superpower rivalry in recent years.
“For an effective Asia strategy, for an effective Indo-Pacific approach, you must do more in Southeast Asia,” said Kurt Campbell, the Indo-Pacific czar at the US National Security Council, said at an event at the New York-based Asia Society earlier this month.
The past few months have been far from a smooth sail for the Biden administration, which has struggled to gain bipartisan support for its top appointments at the Pentagon and State Department. Those difficulties have been compounded by tensions between progressives and more moderate senior officials, who have squabbled on America’s approach to trade and security initiatives in Asia.
US Trade Representative Katherine Tai has emphasized the need for a more “worker-centered” approach, especially amid an upsurge of protectionist sentients among both Democratic and Republican constituencies.
Any regional trade initiative should also chime with Biden’s broader “Made in America” Executive Order, which seeks to enhance American technological and industrial productivity and self-reliance.
More moderate figures within the National Security Council (NSC) and the State Department, however, are intent on pressing ahead with robust countermeasures to China as soon as possible, realizing that time is of the essence in the ongoing superpower rivalry in the Indo-Pacific.
According to the Wall Street Journal, Campbell reportedly “believes there is an urgent need for the US to assert leadership in Asia, the people said, and that the digital-services pact would be a step in that direction.”
Campbell’s views broadly adhere with other senior Biden administration officials, including Secretary of State Antony Blinken, who has broadly endorsed Trump era tough measures against China though emphasizing the need for a more comprehensive and alliance-based approach.
Through the proposed digital free trade deal, which will cover key allies and partners across the Indo-Pacific, the Biden administration hopes to fill in the yawning strategic gap left by the former Trump administration’s nixing of the Obama-proposed Trans-Pacific Partnership Agreement (TPP).
By emphasizing digital trade rather than conventional trade in industrial and agricultural goods, top Biden officials also hope to bypass any potential protectionist resistance in the US Congress, which will have to ratify any final agreement before its full implementation.
Against the backdrop of China’s growing fintech power and 5G network technology, there are also growing concerns over cross-border information flows and the corresponding need for protection of digital privacy and regulating the development of artificial intelligence applications.
Potential pact partners will be among the developed economies across the Indo-Pacific, which also happen to be the original members of the TPP, which was revived by Japan and Australia under the 11-member Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
The proposed deal will cover US digital trade with Canada and Chile in the Western hemisphere to Australia and New Zealand in the Pacific as well as Japan, Singapore, and Malaysia in East Asia. Other top US allies, especially South Korea, as well as major strategic partners such as Vietnam and India are among other top candidates.
The deal promises to be more inclusive and flexible than the TPP, which demands massive structural economic reforms among negotiating partners and thus bypassed many key US allies such as Thailand, the Philippines and Indonesia, Southeast Asia’s largest economy.
Former acting Deputy US Trade Representative Wendy Cutler is widely seen as a top advocate of the deal, which would complement the existing US-Japan Digital Trade Agreement, the Singapore-New Zealand-Chile Digital Economy Partnership Agreement and the Singapore-Australia Digital Trade Agreement.
“Let’s take one step at a time and create the bipartisanship for a digital trade agreement in the Indo-Pacific region and if we can take that first step, hopefully we could look at a second step, which would be TPP membership by the United States,” said Australian Trade Minister Dan Tehan, who has emphasized the urgent need for countering China’s coercive economic diplomacy in the region.
“We are examining ways they can help and support us. Obviously, no country wants to be on the receiving end of economic coercion,” the Australian trade chief added amid intensified trade frictions with Beijing in the past year.
For now, though, the US’ ultimate trump card in Asia is its military prowess. Eager to bolster American strategic primacy, Defense Secretary Austin is set to unveil the UPDI during his much-anticipated visit to Southeast Asia, where he will be visiting Manila, Hanoi and Singapore.
The military initiative was inspired by the European Deterrence Initiative, which was adopted in response to Russia’s aggression in Crimea and eastern Ukraine.
The US Congress established the Pacific Deterrence Initiative under the 2021 National Defense Authorization Act, which initially proposed up to $18.5 billion in additional spending over the next five years in order to bolster the US’ strategic presence in the Western Pacific and Southeast Asia.
The Indo-Pacific Command (INDOPACOM), which oversees the Pentagon’s operations in the region, has sought up to $27 billion in additional spending between 2022 and 2027, with $4.6 billion allocated for next year.
Earlier, former INDOPACOM chief Admiral Philip Davidson lobbied for extra funding for expanded deployment of US strategic missile defense systems and surveillance radars to key US bases in the region in order to create “highly survivable, precision-strike networks along the First Island Chain”, which stretches from the East China Sea in the north to the South China Sea in the south.
The Pentagon is also exploring the prospects of establishing a new “expeditionary” fleet to primarily counter China’s naval ambitions and signal a strong new commitment to its regional allies.
Austin’s visit to Southeast Asia is particularly crucial given that two of his hosts, the Philippines and Vietnam, are China’s top rival claimants in the hotly disputed South China Sea.
In his Fullerton Forum keynote in Singapore next week, the Pentagon chief is expected to lay out the Biden administration’s blueprint for a reinvigorated US engagement with the region and, accordingly, its commitment to keep China’s ambitions at bay.
Winning support and expanded access to strategic bases across Southeast Asia will be key to Austin’s military diplomacy and, more broadly, the Biden administration’s effort to create a networked resistance against China.
“Strong alliances & partnerships are key to supporting a rules-based order in the Indo-Pacific,” Austin tweeted ahead of his maiden visit to Southeast Asia.
“That’s why I’m visiting Singapore, Vietnam, & the Philippines later this week, & I’m looking forward to delivering the 40th… Fullerton Lecture on the evening of July 27th,” he added.