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U.S. should stay engaged with resurgent Asia

U.S. should stay engaged with resurgent Asia

In 1990, when former Malaysian Prime Minister Mahathir Mohamad called for the creation of an East Asian Economic Group, the U.S. was livid.

Secretary of State James Baker described the plan as an attempt to isolate the U.S. from rapidly growing Asian economies by "drawing a line down the Pacific."

At a November 1991 meeting of Asia-Pacific leaders in Seoul, Baker flatly told South Korean Foreign Minister Lee Sang-Ock not to back Mahathir's proposal.

U.S. opposition sent Mahathir's plan into hibernation; it didn't kill it.

This week in Kuala Lumpur, the proposal got off the block once again, with a new name: East Asia community.

The U.S. response appears to be more tolerant this time. The administration of President George W. Bush is less concerned with recompense for spilled blood and more focused on making the proposal work in the U.S.' favor.

Two great themes

"The future of Asia and the Pacific community will be defined around two great themes: openness and choice," Condoleezza Rice, the current U.S. secretary of state, said in Tokyo in March. "Instead of an exclusive club of powers, we stand for a community open to all."

Analysts have interpreted the U.S. position in two ways.

Political scientists Taylor Fravel and Richard Samuels of the Massachusetts Institute of Technology view the softening of Washington's stance on Asian regionalism as a sign that "U.S. declarations of its power in Asia are increasingly at odds with the facts on the ground there."

Ralph Cossa, president of the Pacific Forum Center for Strategic and International Studies in Honolulu, has a different take. It is unrealistic, he says, for the U.S. to get too bothered about an East Asian community that "has yet to be defined - much less credibly emerge."

There's some truth in both points of view. So while the U.S. awaits more clarity to the evolving regional alignment in Asia, it might do well to buy insurance against loss of influence predicted in more alarmist scenarios.

Closed club

The Bush administration may not need to actively oppose an Asian economic alliance as long as the community doesn't deny membership on a narrow interpretation of geography. One such country is Russia, whose admission would stretch the East Asian community all the way to Alaska. The U.S., too, would then become a natural candidate for inclusion.

That's exactly what Japan wants, and China doesn't.

China has persuaded Malaysia and other smaller countries in the region to thwart the U.S. by de-linking the proposed East Asia community from the first-ever East Asia summit, which took place in Kuala Lumpur yesterday.

Australia, New Zealand and India were invited to the summit; Russia will join at some stage. However, just by the virtue of their participation in the summit, these countries won't become members of the East Asian community. The community is expected to evolve independently as a closed club of 13 nations with China as the backseat driver.

Besides Japan, China and South Korea, the alliance will include the Association of Southeast Asian Nations or Asean. The 10 Asean members are Singapore, Malaysia, Indonesia, Thailand, the Philippines, Brunei, Cambodia, Myanmar, Vietnam and Laos.

A European Union-style monetary alliance for East Asia is a far-fetched idea: Bad blood between Japan and China, and Japan and South Korea, may prevent the three from sharing a common currency even if Myanmar and Singapore could one day do so.

Dismantling barriers on intra-regional goods trade will be the foundation of the community, and even that base is proving tough to erect. Thailand is peeved that South Korea's free trade offer to Asean doesn't provide adequate market access to Thai rice farmers. The same irritant - agriculture - is slowing down Asean's trade talks with Japan.

Chances are even slimmer for making quick progress in unrestricted goods trade between Japan, China and South Korea, which together account for 90 percent of the combined gross domestic product of the proposed East Asia community.

Hard work in the future

Given that the formation of the East Asia community is going to be an uphill task, the U.S. can for now afford to treat it with benign neglect.

The Bush administration should, however, prepare its own counterattack by multiplying the measly US$600,000 it spends annually on the moribund Asia-Pacific Economic Cooperation, or APEC, forum by a factor of 10.

A revived APEC, which is ready to admit two new members - India and Pakistan - when the present freeze on membership expires in 2007 could become a useful group for launching an Asia-Pacific community to take the East Asian grouping head on.

Merely talking about how much blood the U.S. has spilled defending freedom in Asia isn't going to stop the region from drawing a line down the Pacific. Not forever.

Andy Mukherjee is a columnist for Bloomberg News.