Many obstacles in China's way

Many obstacles in China's way

China's plan to revive a proposed Asia-Pacific free trade area at the upcoming Apec summit has reportedly hit a snag, in a sign of the challenges it faces as host of the biggest international event to be held under President Xi Jinping's charge.

Beijing is said to have removed two crucial goals it set for the Free Trade Area of the Asia-Pacific (FTAAP), according to a draft of the communique to be issued at the end of the Apec leaders' summit talks next Tuesday.

A Wall Street Journal (WSJ) report last Saturday, quoting unnamed negotiators, said the communique would no longer call for the launch of a feasibility study on the FTAAP or a 2025 completion target date, as a result of pressure from the United States.

Washington fears that progress on the FTAAP could derail ongoing talks for the proposed US-led Trans-Pacific Partnership (TPP) which does not include China. The FTAAP is thus seen as Beijing's counter to the TPP.

But Assistant Commerce Minister Wang Shouwen dismissed the WSJ report at a media briefing yesterday, reiterating that China has "unanimous support from all members" in advancing the FTAAP, though talks on details are still going on.

Observers say the FTAAP, which is viewed as a proxy battle for Asia-Pacific supremacy between Beijing and Washington, tops a list of challenges that China faces in hosting the Apec summit, which kicks off today with meetings by senior officials.

Said Peking University analyst Wang Dong: "I think one of the biggest challenges is China's efforts to push for the FTAAP. Unfortunately, the US has been playing an obstructionist rather than constructive role."

The week-long meetings, which will culminate next Tuesday with retreats by top leaders like US President Barack Obama and Russian President Vladimir Putin, is clearly a tougher endeavour for China than when it hosted the Apec summit for the first time in Shanghai in October 2001.

Then, the world's biggest worry at the Apec event was global terrorism in the wake of the Sept 11 attacks. There was also excitement at the prospect of China joining the World Trade Organisation in December that year.

While terrorism remains a global concern, China itself has sparked suspicions and wariness in the region through its assertive moves in territorial spats with neighbours. There are also greater concerns over a sharp contraction in the Chinese economy, now the second-largest in the world and more intertwined than ever with regional economies.

Unlike in 2001, China now finds it harder to prevent its domestic woes from coming under the glare of world attention during the Apec summit.

For instance, ensuring that world leaders are greeted by blue skies as they arrive is a major problem, with smog forecast to shroud Beijing. This, in turn, exposes how futile measures taken this year to fight air pollution have been.

Also, though the Chinese authorities have deployed the tightest security measures for the summit, the spectre of violence is higher than in 2001 following a string of attacks by Xinjiang separatists.

Another challenge is managing its territorial spats with neighbours such as Japan and the Philippines so that these do not dominate the headlines during the summit.

The need to play gracious host and also to repair Sino-Japanese economic ties means that President Xi might agree to a meeting with Japan's Prime Minister Shinzo Abe for the first time since both took power in late 2012. But Mr Xi also needs to avoid appearing to cede too much ground to Tokyo over the disputed Senkaku/Diaoyu islands.

More importantly, a key challenge is in how China manages to assuage its neighbours' suspicions that have become more pronounced since 2001, said University of Denver analyst Zhao Suisheng.

This change in attitude is a result of China pursuing an assertive foreign policy, especially after the 2008 global financial crisis which saw the Chinese economy coming to the world's rescue, he added.

"China began to think that its might could rival that of the US, and it began to pursue and safeguard its core interests with less room for compromise than before," said Prof Zhao.

"As a result, many began to fear that China would become a hegemony in the region and welcomed the US' pivot to the Asia Pacific." Their wariness is hampering China's proposed initiatives, such as the Asian Infrastructure Investment Bank, that the region needs, he added.

"Xi will have to use the summit to regain trust and respect, especially among smaller countries, if he wants to advance China's goals in the region," said Prof Zhao.

kianbeng@sph.com.sg


This article was first published on Nov 05, 2014.
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