Liveblog: Pursuing the Asian Century

and one last point, as promised earlier… a bit more on the geopolitical importance of new trade architecture like the tpp. it all stems back to the us pivot. at its most fundamental level, the key regional trend is the rise of china. this draws neighbors into china’s orbit economically, but makes them more wary of the security implications that go with it. as a result, many are willing to embrace a heightened us presence in the region.

but us policy of late has sowed doubt as to the american commitment level. on top of domestic economic constraints and other geopolitical distractions like syria, the shake-up of the american leadership in obama’s second term is cause for concern. hillary clinton coined the asia pivot– you can read her words here: http://www.foreignpolicy.com/articles/2011/10/11/americas_pacific_century. while john kerry is a very capable diplomatic replacement, his focus has always been middle east/ europe — we’ve already seen that based on the trips he’s prioritized to date.. another big asia voice, tom donilon, has resigned as the national security advisor.

how does the tpp fit in to this narrative? it’s an important factor in the competition between the us and china for economic leverage over the emerging asia-pacific region. why? it’s not just a normal trade deal. it bestrides the line between trade, investment, and geopolitics, and it will ultimately allow for intricate tradeoffs between the us and its pacific rim allies that will link us power politics, commercial gains, and the efforts of asian states to hedge their relations with china.

but just as the us pivot has lost some steam in other aspects, the growing opportunities surrounding a transatlantic trade deal take some of the wind out of tpp’s sails.

a few closing thoughts about the makeup of asean. with 615m people included– of which singapore accounts for less than 1%– it’s a wonder that singapore accounts for 12% of asean’s gdp. we are talking about a country that is only 274 square miles– less than half the size of london. it’s population density is 7,751 people per square kilometer. and that’s not the only metric that’s sky high– it’s per capita income dwarfs that of other countries in the region. here is a useful chart of some of the gdp per capita stragglers:

(h/t http://www.economist.com/news/special-report/21578169-why-myanmars-military-rulers-are-giving-power-people-democracy-prescription)

here’s a sense of how india is impacting asean:

-trade between india and asean is booming. it grew by 37% in fy2011-12 to about $79 billion.

it’s relations with particular asean countries are interesting. take thailand– india and thailand have been negotiating a free trade agreement for… quite a while. there have been 27 rounds of negotiations over the last 10 years. but they’ve agreed to conclude the fta this fall. and despite no trade agreement in place, bilateral trade between them has grown at over 15% a year over the past five years.

“here in this country [myanmar], you have a good chance not to repeat china’s mistakes.”

“the process of development in any country is never smooth.”

Japan uses 15% less #energy after Fukushima due to energy conservation measures. Human behavior important! @wef energy panel #EA13

— Lynn Loo (@Loo_Group) June 6, 2013

myanmar clocks in with a hefty .01% of world exports. indonesia, with 243 million people, doesn’t do much better at .6%.

singapore may have little more than 2% of indonesia’s population, but it has more than 5x the share of world exports.

“you don’t try to prevail over your neighbors by sheer force.”

at least… not when you don’t have sufficient forces to do so.

now we’re discussing south china sea disputes. countries “going to war over a rock in the sea.”

myanmar undoubtedly has a lot of catching up to do.

we’re talking about the ‘who lost myanmar?’ question. before sanctions opened it up, china had an overwhelming presence.

here’s a very good article explaining what’s happened since:

“chinese investment in myanmar has fallen sharply over the past year amid strained relations, even as interest from other foreign investors in the southeast asian has surged.”
“myanmar president thein sein stopped a chinese-backed $3.7 billion hydropower dam project in 2011 in response to local opposition. the project would have supplied electricity to china.”
“the drop in chinese investment caused total foreign investment in myanmar to fall to $1.42 billion in past fiscal year from $4.64 billion and $20 billion in the two previous years, according to the government.”
http://www.nytimes.com/2013/05/19/world/asia/under-pressure-china-measures-its-impact-in-myanmar.html?pagewanted=all

mahbubani is confident that we can “control geopolitical competition in the region.”

i would strongly take issue with that statement. i submit as evidence:

1. south china sea
2. china/japan hostilities (after a spat last year, japan’s auto exports to china fell 44.5% in september alone)
3. inherent volatility in emerging markets

in terms of seeing opportunities for manufacturing shift to low-income asean countries, that is already very apparent:

78 of the 94 approved foreign investments in myanmar last year were in the labor-intensive manufacturing sector– mostly in garment factories.

We want to be friends with all countries in the world – U Thant Kyaw, Dep Minister of Foreign Affairs, Myanmar #Asian100 #WEF #EA13

— World Economic Forum (@wef) June 6, 2013

“we want to be friends with all countries in the world.”
read: ‘we are now open for investment from anyone.’

and now our moderator parag khanna is shifting the debate to japan’s role, asking for input from yasutoshi nishimura, the senior vice minister of japan’s cabinet office.

within the first minute of his remarks, we’ve heard japan’s key buzzwords:

“abenomics”

“trans-pacific partnership”

“growth strategy”

we were having some technical difficulties with the sound, but we’re back… still hearing from myanmar’s deputy minister of foreign affairs.

he is thanking the countries in the east that have understood the situation in myanmar and supported it for the last 40 years.

and we’re underway…

although i would take issue on one count…. indonesia isn’t a particularly small asean country. with ~240 million people, it is home to about 40% of asean’s citizens. also boasts just under 40% of its gdp. indonesia is the world’s 15th largest economy, having become a trillion dollar economy in 2012.