Exclusive trade arrangement will hurt economic health of Asia-Pacific region: China Daily editorial
In another move to counter China's influence in the "Indo-Pacific" region, the United States announced on Saturday it had reached an agreement with 13 other countries to coordinate supply chains in an effort to lessen their dependency on China for critical products.
The deal, which is aimed at building supply chains that exclude China, is the first result of the Joe Biden administration's trade initiative in the region called the "Indo-Pacific" Economic Framework for Prosperity. Negotiations are continuing on the other pillars of the framework that focus on areas such as digital trade, clean energy and fighting corruption.
Given that the "Indo-Pacific" region accounts for 60 percent of the world's population and is expected to be the biggest contributor to global growth over the next three decades, the US has made a strategic pivot to the region a top priority as a means to counter China on the trade and economic front. The task has gained a sense of urgency after the previous administration pulled the US out of the Trans-Pacific Partnership, an ambitious trade pact involving the Asia-Pacific countries. The US wants to restore its economic leadership in the region and is "presenting Indo-Pacific countries an alternative to China's approach," as US Secretary of Commerce Gina Raimondo said of the administration's economic framework for the region.
Yet whether the launch of the framework will yield expected results is still uncertain given the close economic and trade partnerships that already exist between China and the regional countries. The Regional Comprehensive Economic Partnership, the world's largest trading bloc that now groups China with 10 members of the Association of Southeast Asian Nations plus four other regional countries, already serves as a key engine of trade and investment in the region. It is a fact that will not be easily changed by the launch of an ideologically motivated exclusive trade arrangement that offers neither wider market access nor tariff reductions.
Even US business groups have expressed reservations about the "Indo-Pacific" deal. In a public letter to the government on Friday, more than 30 of them, including the US Chamber of Commerce and the National Association of Manufacturers, said the negotiations were leaving out traditional US trade priorities that could help US businesses, indicating the deal carries more symbolic significance in trying to depict China as a disruptor of global supply chains rather than bringing any substantial benefits to US and other countries' companies.
The economic success of the Asia-Pacific region has been achieved through cooperation and mutual benefit among regional countries based on open and inclusive trade agreements. Any arrangement that is discriminatory, exclusive or of a protectionist nature will serve no party any good. This is especially true of the attempt by the US to try to hold back China's development by politicizing trade and economic issues, and cajoling other countries into adopting anti-China trade policies, acts that will seriously disrupt the global industry and supply chains with indiscriminate effects.