Comment on “Politics of Trade in the USA and in the Obama Administration: Implications for Asian Regionalism”

Abstract

Major political changes in the USA, developments in regionalism in East Asia, stagnation of the Doha Round, shifting economic power from the USA to Asia, and the global financial and economic crisis are all impacting on trade relations between the USA and East Asia. Barfield (2009) focuses on political developments in the USA impacting on US trade policy,rise of regionalism in EastAsia,and implications of US trade policy forAsian regionalism.An equally pertinent perspective is the implications of EastAsian regionalism for US trade policy toward East Asia. The present scenario is different from the early 1990s when then Malaysian Prime Minister’s proposal for an EastAsian Economic Group was scuttled by US objections.The surge in East Asian regionalism will continue whatever is the US trade policy toward East Asia. Changes that have taken place since the early 1990s include the economic rise of East Asia (particularly China), a more cohesive Association of Southeast Asian Nations (ASEAN),and the warming of political and economic ties among the EastAsian countries since the end of the Cold War. While the USA is still the most powerful economy in the world, its relative economic weight has declined. Also, East Asian economies are told repeatedly to rebalance their growth strategies to reduce dependence on the US market, and this change will hasten intraregional economic interdependence. The Asia‐Pacific Economic Cooperation (APEC) was formed to prevent a split down the Pacific and keep the USA engaged with Asia. However, APEC has suffered from US leadership neglect in recent years, and its inability to fulfill the Bogor goals has disillusioned some members. The stagnation of APEC, together with the stalled Doha Round negotiations,the rise of discriminatory trade blocs in North America and Europe,and the Asian financial crisis of 1997‐1998 have heightened the sense of Asian financial and economic vulnerability.There is growing awareness of the need to cooperate and integrate regionally to be economically resilient and competitive and to have a coherent voice in the international fora.ThatAsia is rising is evident from pressures to reform the International Monetary Fund and World Bank to reflect Asia’s growing economic weight and the replacement of G-8 with G-20 (with five Asian members) as the leading policy dialogue group.