The Blog of Changes - Duncan Freeman

The EU on the Margins in Asia

For a few days in November Beijing almost seemed like the centre of the world. The Asia-Pacific Economic Cooperation (APEC) summit in Beijing brought together a diverse group of 21 countries from the Asia-Pacific which includes those as far flung as Australia, New Zealand, Chile, China, the US, Russia, Japan, South Korea and several from southeast Asia. For once, the results of a summit exceeded the billing. Much was written in the Western media about who shook whose hand, who smiled at whom and who stood next to whom. Some of these meetings and greetings were undoubtedly important, especially in the case of China’s President Xi Jinping and Japan’s Prime Minister Shinzo Abe, which has perhaps unlocked an improvement in one of the most important relationships in Asia, but there was much more to the summit than this.

The summit produced an APEC declaration on fighting corruption, one element of which is to establish a regional network on to coordinate anti-corruption activities, apparently set up at the request of the Chinese government. The summit declaration also gave support to the Free Trade Area of the Asia-Pacific (FTAAP), which is backed by China. The other main outcomes of the summit were several declarations concerning issues such as trade and investment, economic development, reform and growth, regional connectivity and infrastructure. China was also eager to promote its vision of regional vision of regional integration through infrastructure construction.

However, it was the bilateral show between China and the US which caught many of the headlines. There were agreements between China and the US on several issues. The main headline grabber was the declaration signed by presidents Xi Jinping and Barak Obama on climate change. There was an additional bilateral agreement on expansion of the WTO Information Technology Agreement (ITA), which reduces trade tarrifs on IT products. Less widely publicized were two sets of rules agreed by China and the US which are intended to avoid military confrontations. The two also signed an agreement easing of visa restrictions,

Other bilateral agreements emerged at the summit, for instance one signed between China and Russian on energy supplies. China and Vietnam also came to an agreement on settlement of maritime disputes. In addition, China and Japan had come to an accord prior to the summit that sought to take the heat out of their disputes and which enabled the Xi-Abe handshake to take place.

It would be wrong to think that the Asia-Pacific has suddenly resolved itself into harmony. Conflicts were on clear view, not least between Russia’s President Putin and several of the other leaders present. China and its neighbours are far from resolving their differences. Despite their agreements, the US and China had obvious divergences, notably between the US and its Trans Pacific Partnership (TPP) and China which is promoting the FTAAP. The US, just to emphasize this divergence, held a meeting in its Beijing embassy to discuss the TPP, although it led to no real progress in the negotiations. Many of the underlying regional problems remain. But for once, the leaders attending the summit could say it had not been a complete waste. The two key countries, China and the US, could both claim to have achieved real successes, both bilaterally and regionally.

Where was the EU in all this? The obvious answer is nowhere, since the EU is not part of APEC. However, this in itself raises a more fundamental issue. What does the EU do in Asia? The APEC summit brought together widely disparate countries of the Asia-Pacific, and produced some real results. There is no equivalent of this for the EU and Asia. True, the EU has its own forum for interaction with Asia, the Asia Europe Meeting (ASEM). But this runs a poor second in terms of status and outcomes. The ASEM bills itself as a “dialogue facilitator”. At best it produces many dialogues, but which, while they may be very worthy, produce few significant outcomes. In the area of trade, the EU has its own efforts at policy in Asia, but their ambitions and achievements are limited, and certainly do not match the goals of the US (whether the US efforts to create TPP will actually achieve anything is another matter). A Free Trade Agreement (FTA) here or there and a scattering of Partnership and Cooperation Agreements (PCA) is the best to be hoped for from the EU. With China the EU has its Strategic Comprehensive Partnership, but at the moment the EU’s level of ambition is limited to negotiating a Bilateral Investment Treaty (BIT).

Of course, the EU does not have the same strategic commitment to Asia as the US. Yet, even leaving this aside, the influence of the EU in Asia remains weak. True, following the APEC summit, the EU was present at the G20 meeting in Australia, a meeting that by coincidence happened on the margins of the Asia-Pacific region. Perhaps there the EU could claim some influence by being partly responsible for forcing climate change onto the agenda over the resistance of the Australian Prime Minister Tony Abbott. A victory in alliance with the US among others over the Australian prime minister can hardly count as a great achievement, and the real momentum had in any case largely been created by the Xi-Obama climate declaration a few days previously. But, in reality the meeting only served to illustrate the weakness of the EU. The main outcome of the G20 was agreement on growth, which supposedly committed the members to adopting policies intended to achieve an additional 2% annual GDP growth over current trends. This merely serves to highlight the EU’s abysmal recent economic record and prospects, in contrast to most of East Asia and even the US.

The EU may see itself as having soft or normative power, and it does do much that is positive in Asia, but it has limited impact in the region. The fact that China chose to sign a climate change agreement with the US, rather than the EU, which portrays itself a climate change leader, tells us which President Xi regards as most important. The same can be said for the agreement on the ITA between China and the US. These are not just bilateral in importance. The first gives some hope for a global climate change agreement, and the second gives a flickering of vital signs to the comatose global multilateral trade process. For all the contradictory nature of the US relationship with Asia and with China it remains important, despite signs of its declining power and much that is questionable about the intentions and results of President Obama’s rebalancing to Asia. The EU as a group is marginal to Asia, and disengaged. Will this change with the EU’s new leadership? There are many good excuses for why it will not. First among them is the huge effort required from the EU to rectify its own domestic failings. Externally, problems closer to home, the Ukraine crisis and the disaster that stretches across most of North Africa and the Middle East, will occupy much time. But Asia, and especially China, even if it is far away, requires engagement. Europe has a choice either to accept its marginal position in Asia or do something to change it.


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