China Scores with ASEAN Play as Trump's America Loses its Way in South China Sea

On March 12, 1947, as the spectre of Soviet communism loomed over the horizon of newly liberated Europe, President Harry Truman vowed that it would be the policy of the United States to “support free people who are resisting subjugation by armed minorities or by outside pressure”. Three months after enunciating the Truman Doctrine, his secretary of state, George Marshall, launched a US$13.5 billion Economic Recovery Plan, better known as the Marshall Plan, to rebuild and revitalise war-torn Europe. The plan’s commitment totalled more than 5 per cent of the US’ 1948 GDP – about a trillion dollars in today’s value.

Seven decades on, President Donald Trump singled out China and Russia in his National Security Strategy as strategic threats to the US that are “determined to make economies less free and fair, grow their militaries, and control information and data to repress their societies and expand their influence.” Seven months later, on July 30, Trump’s Secretary of State, Michael Pompeo, unveiled a “new era in US economic commitment to the peace and prosperity in the Indo-Pacific region” and, without a trace of embarrassment, resourced it to the tune of US$113 million.

The administration’s puny down payment towards its “Free and Open Indo-Pacific Strategy” is as short-sighted as it was predictable. The die was cast last December when Trump announced that his administration would promote an alternative development model that “shifts from a reliance on assistance based on aid and grants to approaches that attract private capital and catalyse private sector activity”.

If private markets worked anywhere as well as Trump imagined, the Indo-Pacific region would not be the many trillion dollars short of infrastructure financing as it is today – a point acknowledged by his secretary of state in his otherwise lamentable address on July 30th. Pompeo would have been better off directing the administration’s funds to the Asia Infrastructure Investment Bank’s (AIIB) “special funds mechanism”, whereby external funds potentially can be managed by the institution, channelled into infrastructure projects, catalyse private money, yet is held separately from the institution’s shareholder equity.

Of course, an American contribution to the AIIB is not about to happen any time soon. The AIIB already boasts a lending portfolio that outstrips that of the US’ Overseas Private Investment Corporation (OPIC) and Millennium Challenge Corporation, individually, in the Indo-Pacific – despite having been in existence for a mere two-and-a-half years. Its multilaterally managed lending capacity will far outstrip anything that this or future US administrations have to offer.

The stunted economic vision of the “Free and Open Indo-Pacific Strategy” is matched by the irresolution of the Trump administration’s security commitment to its allied and non-allied defence partners in Southeast Asia.

Asked to elaborate on the coverage of the US-Philippines Mutual Defence Treaty’s security obligations at the recent Shangri-La Dialogue in Singapore, US Defence Secretary James Mattis could do no better than deflect the question with a rambling dissertation on civics lessons and confidentiality. It took Mattis a mere two weeks in office, on the other hand, to publicly restate Washington’s crystal clear security commitment to the defence of Japan (and the Senkakus islands) – amplifying the nature of its defence commitments in Southeast Asia.

No amount of US freedom of navigation operations (FONOPs) across the South China Sea will paper over this irresolution. To the contrary, the repeated FONOPs only serve to illuminate an unsavoury strategic truth: without an agitated local claimant on whose behalf it can claim to be intervening to uphold the stability of the South China Sea, the US has few other tools at its disposal to assert its relevance and authority in this body of water, other than to endlessly navigate its length and breadth. Judging by developing amity in China-Asean relations, no such agitated local claimant in the South China Sea is about to present itself to Washington any time soon.

China-Asean relations are in the early stages of a virtuous cycle that took root – contrary to Washington’s and Western expectations – on the very day the Philippines vs China arbitral tribunal rendered its award.

During an earlier virtuous cycle from 2002 to 2008, the two sides had made important headway in their relationship. Following the signing of the Declaration on the Conduct of Parties in the South China Sea in November 2002, the sides went on to establish a Strategic Partnership in October 2003 and Beijing became the first official non-Asean country to accede to the Treaty of Amity and Cooperation in Southeast Asia. China’s relations with Asean countries, too, reached important highs during this period, leading to what came to be termed as Beijing’s “charm offensive” towards Southeast Asia.

Likewise, the opening of a new chapter in China-Asean cooperation on July 12, 2016, has already witnessed the successful testing of their foreign ministry to foreign ministry hotline to manage maritime emergencies, the operationalisation of the Joint Statement on the Application of the Code for Unplanned Encounters at Sea in the South China Sea, the adoption of the framework of a Code of Conduct and, as announced earlier this week, an agreement among the parties on a Single Draft Code of Conduct Negotiating Text. Similarly important progress should not be discounted over the next two to three years. Imaginative approaches by China and claimant states, notably the Philippines, to address their common resource-based challenges are also likely to be a feature of this cycle.

Washington’s “Free and Open Indo-Pacific Strategy”, even more so than the “Rebalance to Asia” strategy, is utterly unsuited to cope with the opportunity at hand. It lacks resolution, resources and re-imagination. Without an altogether more wholehearted embrace of the Asia’s Asean-centred security multilateralism as well as deeper integration within the Asia-Pacific’s emerging community-style economic order, the US will find itself relegated to the sidelines. The US sat out the previous China-Asean cycle in the 2000s; its looks set to do so again – with the inevitable diminution of its influence felt down the line.

This article originally appeared in the South China Morning Post