No crisis that doesn’t create opportunity. U.S. President Barack Obama’s enforced absence from the Asia-Pacific Economic Cooperation (APEC) meeting in Indonesia to deal with America’s fiscal follies in Washington has allowed China’s President Xi Jinping to take center stage in Bali.
Obama had hoped to use the occasion to advance the now-U.S.-led free trade agreement (FTA) known as the Trans-Pacific Partnership (TPP). Xi, however, is taking the opportunity to boost the Regional Comprehensive Economic Partnership, an FTA led by the Association of South-East Asian Nations (ASEAN), and to push APEC as the lead coordinator of all FTA negotiations in the region, of which there are currently some 100.
Chinese state media say that that such coordination would help lead to the creation of a single integrated regional FTA, and prevent the developed economies writing the trade rules for Asia’s developing economies. No doubt Xi would see that eventual integrated regional FTA as being one under the sway of Beijing as much if not more than of Washington, and in which the yuan as much if not more than the dollar would be currency of commerce.
With America’s largest foreign creditor getting antsy about the possibility of a default on its $1.3 trillion holding of U.S. Treasuries, that may look a doubly appealing prospect from Beijing.