On a recent episode of the China in the World podcast, Paul Haenle spoke with Carnegie China nonresident scholar Evan Laksmana on how the United States and China are approaching Southeast Asia. A portion of their conversation, which has been edited and condensed for clarity, is below.
Paul Haenle: What are the similarities and differences between U.S. and Chinese approaches to engaging ASEAN countries?
Evan Laksmana: There’s an interesting distinction between how the United States and China have engaged ASEAN and Southeast Asia. I think the United States has built a deeper reservoir of engagement over the last 50-60 years, especially regarding people-to-people ties, education, and security relationships. China has only started to engage Southeast Asia closer over the past 20-30 years. You see a more bottom-up approach from the United States. There is less of a compelling need to have these strategic partnerships, comprehensive partnerships, or big frameworks, because the United States feels that it is doing well on the key policy issues.
But China does it in reverse. Beijing first launches these big frameworks and partnerships and then fills them in over time. Over the last two or three decades, a lot of programs and activities have come from these big frameworks and strategic partnerships. It is an interesting contrast in how China and the United States approach Southeast Asia.
The economic piece is quite fascinating. The debate around the Trans-Pacific Partnership (TPP), and then around the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), was initially about exclusionary trade regimes. There were concerns that we would see a fracturing of trade regimes where China had its free-trade agreement with ASEAN and the Regional Comprehensive Economic Partnership (RCEP), and then the United States had TPP. The challenge of regional economic integration, particularly with regard to ASEAN’s own agenda through the ASEAN economic community, was to navigate and integrate these emerging regional economic frameworks.
The Indo-Pacific Economic Framework (IPEF) is part of this larger trend of exclusionary trade regimes. You see a lot more support for IPEF for a couple of reasons. We are not sure what it will lead to. Sure, there is a discussion on higher standards, but it is not clear what will happen with market access given U.S. domestic politics. There is a low cost of entry to sign on to IPEF right now because, in the minds of some policymakers, this is essentially a lot of process with no clear gain, which also means there is no clear risk at this point. The joke in Southeast Asia is that IPEF is proof that ASEAN has successfully socialized the United States in its own ways, which is to have meetings to discuss future meetings. It’s all about process.
The future of economic engagement and technology in the region will be centered around issues like standards, education, emerging technologies, and supply chains, which we have not yet quite figured out. The pandemic has hit home the message that globalization and integration do come with supply chain vulnerability issues. For Southeast Asia, IPEF is a good signal that the United States is at least willing to put some economic skin in the game. How far, and to what extent, we do not know. But at this point, we do not want to spook the United States, because we would like to see more of a U.S. economic presence in Southeast Asia. If this low-cost, low-risk entry into IPEF means the United States will stay and potentially engage the region more, it is certainly worth pursuing.
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