Euphoria should not distract China's careful strategy
- By George N. Tzogopoulos
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E-mail China.org.cn, November 22, 2016
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| Chinese President Xi Jinping (R) meets with his U.S. counterpart Barack Obama in Lima, Peru, Nov. 19, 2016. [Photo/Xinhua] |
Chinese President Xi Jinping is now visiting Latin America and has already attended the APEC Summit in Lima, the capital of Peru. The ongoing rise of China and its influential political and economic role in the Asia-Pacific region add special importance to this visit. This time, especially, several experts on China's affairs see it as an opportunity for the country to boost its influence. Some Western media even foresee that the Beijing administration could take the lead from the U.S.
In particular, the victory of Donald Trump in the U.S. presidential election has generated a debate over what it could entail for American economic and foreign policy and how potential changes could impact China. Before discussing developments at the APEC level, a reference to Latin America is required. Latin America did not largely attract the attention of Trump during the pre-election campaign. He almost exclusively focused on the U.S. relationship with Mexico, promising to toughen measures in order to stop immigration with the construction of a wall. Also, his stance on Obama's reconciliation with Cuba is not clear.
In reality, although Trump has targeted Hispanics in some of his public comments, he is personally interested in Latin America, as his business empire has been flourishing there for years. A recent article published by The Independent reveals that he has massively invested in the construction and the development sectors of many Latin American countries. That being said, the prediction by American organizations such as the Atlantic Council that Latin America will not be Trump's priority has been challenged. Mitt Romney, for instance, who could perhaps be the new Secretary of State after his meeting with Trump, called the region "a huge opportunity" in his presidential campaign in 2012, because its economy "is as big a China's." And the foundation of the Pacific Alliance by Chile, Colombia, Mexico and Peru has created additional opportunities for U.S. companies.
Subsequently, China should not necessarily expect the U.S. President elect to abandon Latin America. By contrast, it continues its systematic policy of expanding ties and increasing business opportunities. According to its Ministry of Commerce, for example, Chinese direct investment in Latin American grew from $3.68 billion in 2008 to $12.61 billion in 2015. This is what can guarantee the expansion of China's presence and the establishment of a stronghold in the region, and not the expectation of inertia by the U.S. If the latter is followed by practice in 2017, then Beijing will explore how it might benefit.
With reference to APEC, the Chinese administration is also taking a careful stance. Two years ago, President Xi proposed in Beijing the building of a Free Trade Area of the Asia-Pacific (FTAAP). This year he reiterated the same call in his speech in Lima. For the time being, it seems that the Chinese vehicle for a Regional Comprehensive Economic Partnership (RCEP) is gaining ground to this end. This is because the U.S.-led Trans-Pacific Partnership (TPP) project has lost momentum. There is no chance any longer for it to be voted in by a lame duck Congress session while Trump strongly opposes it.
Some analysts and media tend to draw premature conclusions. China is currently benefiting by its standard positions as opposed to the general confusion about Trump's trade policies. The new U.S. President elect might soon see American companies seeking to establish offshore bases in Asia. He could also see his country's TPP partners finding alternatives. Whether he will resist the trauma remains to be examined. It will thus be wise for the Chinese administration to be prepared for all scenarios.
George N. Tzogopoulos is a columnist with China.org.cn. For more information please visit:
http://www.china.org.cn/opinion/GeorgeNTzogopoulos.htm
Opinion articles reflect the views of their authors, not necessarily those of China.org.cn.
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