Round 3 of the China-US game is now being played in the field of international trade. We have the US-led Trans-Pacific Partnership that has kept China out, and the ASEAN-led (and China-led) Regional Comprehensive Economic Partnership that excludes the US.

Round 3, hangs in the balance. This is because unless the negotiators can conclude a deal soon, it will be impossible to get it ratified by the US Congress this year. By that stage the US presidential election is likely to overshadow trade talks and TPP approval may have to wait until the next presidential term. If TPP disappoints or, worse still, it is not concluded at all, it will be another major setback for the US in Asia as it is the economic arm of US President Barack Obama's "pivot" to Asia.

Although in a game of baseball, three strikes means "out", this is not the case in global and regional diplomacy. It only means that the US' clout in the region will weaken and the sparring between Beijing and Washington will continue in the future. China-led institutions in Asia will not pose a threat to the well-established IMF or the World Bank. They will, however, complicate global economic governance and make it more complex.

If US-led and China-led institutions cannot take joint decisions and work with each other in a complementary manner, 70 years after the original Bretton Woods agreement, we will need a "New Bretton Woods" agreement led by a select group from the truly "systemically important countries" of the world, not the motley group comprising the G20.

The author is associate professor and coordinator of the International Political Economy Programme in the Centre for Multilateralism Studies at the S. Rajaratnam School of International Studies, Nanyang Technological University, Singapore.

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