Trump will highlight Vietnam as a model for Kim

Subject A possible second Trump-Kim summit. Significance Vietnam last week said it had not been told about the timing or location of a possible second summit between US President Donald Trump and North Korean leader Kim Jong-un but that it was confident it could host such an event. Washington earlier in January announced that a summit would be held in February, following landmark talks between Trump and Kim in Singapore last year. Impacts A summit in Vietnam would provide Trump with a distraction from investigations into his alleged links with Russia. The summit would bolster ASEAN’s claims to be crucial to promoting peace and security in the ‘Indo-Pacific’. A successful Trump-Kim meeting would be welcomed by Beijing but would not influence US-China trade talks. Trump would be unlikely to travel to South-east Asia for a second time this year to attend the East Asia Summit in Thailand in November.

Significance Regional leaders had been anxious that Washington under US President Donald Trump seemed relatively uninterested in the region. Tillerson was also preparing the way for Trump’s visit in November to the APEC meeting in Vietnam and East Asia Summit in the Philippines. Impacts If Washington is too bullish towards bellicose Pyongyang, ASEAN governments may become concerned, undermining US-ASEAN ties. ASEAN governments will fear any deterioration in US-China ties that could spark a trade war, with negative regional effects. ASEAN leaders are not yet reassured that Trump’s administration will give equivalent attention to South-east Asia as under his predecessor.


Subject US-ASEAN relations. Significance A US-ASEAN summit, proposed late last year by US President Donald Trump, is tentatively scheduled to be held in March in Las Vegas. After an ASEAN Foreign Ministers’ Retreat in Vietnam earlier this month, the South-east Asian regional bloc issued a statement welcoming the summit. However, only a few member states have formally signalled their intention to participate. Impacts For ASEAN leaders that attend, the summit may compensate for Trump’s likely absence from the 2020 East Asia Summit in Vietnam. The United States is unlikely to join the Comprehensive and Progressive Agreement on Trans-Pacific Partnership. Any violence in South-east Asia sponsored by Iran or its proxies will strengthen US cooperation with the region on counterterrorism.


Subject Emerging US policy towards South-east Asia under the Trump administration. Significance On May 5, the 30th US-ASEAN Dialogue opens in Washington, to be co-chaired by US Secretary of State Rex Tillerson. This follows Vice-President Mike Pence’s visit to Indonesia of April 20-22, the first to South-east Asia by a cabinet-level official from the Trump administration. The White House used that occasion to announce that President Donald Trump will attend the APEC meeting in Vietnam and the East Asia Summit (EAS) in the Philippines in November. Impacts Trump may co-chair a US-ASEAN Summit with Philippines president on the EAS’s margins, which could improve frayed bilateral ties. Congress could frustrate any Trump administration plans to sanction countries with trade surpluses with the United States. An ASEAN-US free trade agreement is unlikely soon. Trump has invited Vietnam’s prime minister to visit Washington later, which could make Hanoi more bullish towards China.


Subject Impact of COVID-19 crisis on US-China rivalry in South-east Asia. Significance Washington’s preoccupation with handling the COVID-19 crisis has undermined the operational readiness of US armed forces in the Indo-Pacific. China has capitalised on this situation by pushing its claims in the South China Sea. Impacts South-east Asian economies will be hit hard as US-China trade tensions rise and foreign investment falls. Infrastructure projects in the region that are part of China’s Belt and Road Initiative will face delays and cancellations. Medical assistance from the United States, China and elsewhere will barely ease the strain on regional health systems caused by COVID-19.


Significance Japan is viewed by ASEAN states as the most constructive player among the major powers. China is seen as aggressive and the United States as unreliable under President Donald Trump. Impacts Suga is unlikely to remain in office for more than a year. Post-pandemic economic recovery in Japan will be slow due to weak demand for its manufactured goods at home and abroad. China’s stance over the disputed Senkaku/Diaoyu Islands and the missile threat from North Korea will be Tokyo’s top security concerns.


Significance The region’s states try to avoid being drawn in, individually and under the aegis of ASEAN. If tensions between Washington and Beijing were to get out of hand, they could come under greater pressure to take sides. Impacts Washington is unlikely to press the region’s states to allow it to establish military bases in their territories. If Donald Trump is re-elected US president next month, he will continue to take a hard line on Huawei and other Chinese tech companies. China and the United States will struggle to increase their soft power in South-east Asia.


Subject Outlook for US policy towards South-east Asia under the Trump administration. Significance Donald Trump becomes US president on January 20. South-east Asian governments are assessing the outlook for relations with Washington during his administration. Their region drew scant attention during the US election campaign, and regional leaders have little reason to think South-east Asia will be an early Trump administration priority. However, they fear the effects of possible early frictions between Washington and Beijing, and increased regional rivalries if Washington and Moscow strengthen relations to China’s detriment. Impacts Thai-US relations are likely to warm under Trump. Myanmar’s leaders will look to the US Senate to protect the gains in Myanmar-US ties under Obama. Trump-owned or branded businesses in South-east Asia could face protests or terrorist attacks.


Subject Singapore-US relations. Significance On April 30, Prime Minister Lee Hsien Loong spoke with US President Donald Trump. For Trump, the call was an initial move to strengthen ties with Washington’s partners in South-east Asia amid the North Korean crisis. Lee accepted an invitation to Washington. For Singapore, the call was about gauging a new, thus far mercurial US administration which, to Singapore’s concern, has expressed protectionist trade sentiments and relatively limited detail about its foreign policy aims in East and South-east Asia. Impacts The current lack of a US ambassador to Singapore is not unprecedented and will not greatly affect bilateral relations. China-Singapore ties are warmer, but any overly assertive Chinese efforts to gain South-east Asian influence could change this. Singapore will push for a reworked version of the TPP to be devised, with Japanese leadership.


Subject Economic impact of the US-China tariffs. Significance Research into the impact of the US-China trade tariffs on other economies suggests that South-east Asia will benefit, and especially so if the tariff rate on US-China trade increases to 25% on March 1. Trade diversion to ASEAN will more than offset the impact of tariffs increasing prices at various supply chain stages, directly and indirectly dampening demand in these economies. Impacts Lower-value supply chain shifts will be easier and more prevalent, raising the quantity but not quality of GDP and jobs in beneficiaries. US officials are heading to China this week; tariff increases may be delayed but old tariffs will persist, as will the threat of more. None of the research into the impact of the conflict suggests that it will meet the US aim of notably trimming the US goods imbalance.


Subject China-US trade talks. Significance On June 29, US President Donald Trump and Chinese President Xi Jinping met on the margins of the G20 meeting in Osaka, primarily to discuss the ongoing bilateral trade disputes. The results of the meeting can be considered progress in that they averted a further escalation of tariffs and agreed to resume trade negotiations, the latest round of which broke down seven weeks ago. Impacts South-east Asia, which benefits from firms redirecting investment, can probably count on US tariffs remaining in place during negotiations. US pressure on other states to choose 5G hardware from Western companies rather than from Huawei has not been addressed. Trump will face bipartisan anger from Congress if he eases restrictions on Huawei.


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