Group: ASIA-PACIFIC SME COMMUNITY Help World SME IN Business Contacts, Finance, and Management

US Secretary of State Hillary Rodham Clinton is due to visit Manila next week to hold consultations with senior Philippine officials on security alliance concerns and other issues, officials from both countries said.

The 24-hour visit, which will take place from November 12 to 13, will be the first by Clinton as Secretary of State. She had accompanied her husband Bill during his trip to the country in the past when the latter was President of the United States.

Clinton will make the trip to the Philippines in between her meetings at the Asia Economic Conference (Apec) forum in Singapore.

The Apec sessions will take place from November 10 to 19, and will be highlighted by the Leaders' Meeting to be attended by US President Barack Obama, among other heads of state.

China's president Hu Jintao told Asia-Pacific business leaders that recovery in the global economy was not yet firmly established.

During his address to senior business and political leaders gathered for the start of the annual Asia-Pacific Economic Co-operation (Apec) group summit in Singapore, he said economic recovery still faced many "uncertainties and destabilising factors".

The speech to the so-called CEO summit is likely to set the tone for much of the weekend's gathering, with US president Barack Obama due to join other regional leaders in Singapore on Saturday.

"We must continue to promote trade and investment liberalisation and facilitation and oppose protectionism in all its manifestations, particularly the unreasonable trade and investment restrictions imposed on developing countries," Hu said.

The inherent problems of the international economic system have not been fully addressed and a comprehensive world economic recovery still faces many uncertainties and destabilising factors. China will further boost domestic demand, vigorously expand the domestic market, and promote balanced growth of domestic and external demand."

Hu added that the focus of Beijing's 4 trillion yuan ($586 billion) stimulus package was on expanding China's domestic demand and creating a new pattern of economic
growth.

The discussion at the summit would centre on China's role that is best placed for leading the world out of economic decline.

With much of the world still reeling from the impact of the slowdown, the catchwords of the summit were "inclusive, balanced and sustainable growth", with the emerging economies of Asia, particularly China, taking centre stage.

In the run-up to the leaders' summit at the weekend, Asia-Pacific finance ministers have already been discussing the challenges of sustaining global recovery and encouraging free trade.

The week-long Apec forum culminates in a high-level summit that will include Obama, China's president Hu, and Yukio Hatoyama, the Japanese prime minister.

On Thursday Beijing won praise from the US treasury secretary, Timothy Geithner, among others for its mix of stimulus spending and stable finances that had helped breathe life into the global economy.

China's economic influence over the region is expanding.

In the past decade, China, the world's third-biggest economy, replaced the US as the biggest trading partners for Japan and South Korea.

China's economic recovery from a slowdown late last year, recording 8.9 per cent growth in the third quarter, is widely credited with helping stimulate demand and counter recessions in other countries.

The US treasury chief however shied away from comment on whether Obama, who will visit Beijing next week, would lobby Chinese leaders for faster movement on loosening restrictions on the Chinese currency, the yuan.

US manufacturers, and many in Europe and Asia, have long complained that the yuan's effective peg against a weakening US dollar, makes Chinese exports artificially cheaper, and thus more competitive, in overseas markets.

Asians complain that when George Bush chose Iraq and terrorism as his main arenas in foreign affairs, it was at their expense. Barack Obama intends his first Asian trip as president, which begins in Tokyo on November 13th, as proof of change. As well as Japan, the tour takes in Singapore, China and South Korea. Engagement in the region, he says, is critical to America’s future. Advisers even suggest that what he achieves there will help define Mr Obama’s presidency. Of course, they say that about a lot of things on his plate. But to judge by ordinary folk, the region wishes him well. Many Indonesians think of Mr Obama as one of their own. In Japan students of English have emptied the bookshops of his collected speeches.

Some activity suggests there is indeed a new engagement. In July, the American secretary of state, Hillary Clinton, signed ASEAN’s Treaty of Amity and Co-operation. The ten-member Association of South-East Asian Nations had been largely ignored by Mr Bush. This weekend Mr Obama will meet ASEAN’s leaders as a group, which is a first. His administration reached out to the thuggish junta in Myanmar, reversing a policy of isolation, and on November 10th said Mr Obama’s special envoy to North Korea would go to Pyongyang for talks with the obstreperous nuclear state (after close consultation with South Korea and Japan first). The president has taken pains to define China as a “strategic partner”, one without whom America has little hope of tackling everything from the global economic crisis to climate change and nuclear proliferation. And Mr Obama’s energetic support this year for the G20, with its Asia-heavy membership, can be read as a tacit acknowledgment that in economic and political terms the world’s centre of gravity has shifted away from the G8 group of wealthy nations.

And yet. American policy in Asia—or, just as often, the lack of it—retains the power to unsettle its friends in the region. Take Japan, the cornerstone of America’s Asian alliances. There, some people ask whether the hand extended to America’s adversaries might reasonably be extended to its allies too. The Democratic Party of Japan (DPJ), which recently swept away the old political guard, wants to put Japan’s security alliance with America on a more “equal” footing, one in which America does not call all the shots. Many Americans, too, see disadvantages in a skewed relationship. Among other things, it discourages Japan from taking up more international responsibilities.

Soon after coming to office, Japan’s prime minister, Yukio Hatoyama, suggested revisiting an unpopular plan, agreed under the previous government, to move an American air base on Okinawa, a tiny southern island with an overwhelming American military presence. The Obama administration could have shown patience towards a government still finding its feet. But it was confrontational from the start. Changing the agreement, said the defence secretary, Robert Gates, was out of the question. Japan, a State Department official told the Washington Post, was a bigger problem than China—an extraordinary judgment. It is true that Japan could have handled the problem better (see article). But America has done itself few favours and the best Mr Obama can do now is remind both sides of the strategic ends of their alliance and call for a rethink about the means. Next year’s 50th anniversary of the pact would provide an occasion for that.

Elsewhere in Asia, a new engagement, however welcome, is not thought to be enough. Many of China’s neighbours, eyeing its rise, want the reassurance of a more robust American presence. In a recent speech in Washington, DC, Singapore’s patriarch, Lee Kuan Yew, surprised his audience by raising concerns about China’s naval build-up, something South-East Asia’s leaders rarely talk about in public. “If you do not hold your ground in the Pacific”, he told the Americans, “you cannot be a world leader.” In private, Mr Lee was blunter: “You guys are giving China a free run in Asia,” the Financial Times reports him saying. As well as engaging China, America must also balance it.

Mr Lee had America’s economic influence in mind as well as its military presence. Take free-trade agreements (FTAs). China has signed FTAs with most of its neighbours, including with ASEAN as a whole, often on terms more favourable to China than to its partners. Talk is growing about the possibility of a super-FTA between China, Japan and South Korea. Asians are also negotiating FTAs with the European Union. In contrast, the ratification of a landmark agreement between South Korea and America is mired in Congress. The administration has taken retaliatory measures against imports of Chinese tyres. It has even drawn back from perhaps the only regional project seeking genuinely open trade, the Transpacific Partnership, led by a handful of liberal states. Meanwhile, South-East Asia’s battered exporters long for America to take a tougher stance with China over its undervalued currency that is, in practice, pegged to the declining dollar while other regional currencies rise. Mr Obama has been squishy on the issue, not wishing to poison Chinese-American relations.

So Mr Obama will be monitored, as well as celebrated. On trade, an American commitment to seek an FTA with ASEAN would send the right signal. So would re-engaging with the Trans pacific Partnership. On Myanmar, whose abuses are poisoning ASEAN’s own future, the president needs to be clear to the region’s leaders, including Myanmar’s prime minister (whom he will meet), that he will bring the pariah state in from the cold only with the release of Aung San Suu Kyi and the launch of a democratic process involving the opposition and minorities. And Mr Obama needs to signal that America will balance a rising China in such a way that China’s neighbours never have to take sides.




Source:The Economist

Seeking help with an array of global troubles, President Barack Obama said Tuesday that his closely watched talks with his Chinese counterpart are vital not just for their nations but the world.

Marking 30 years of relations between the US and China, Obama said: "I think it's fair to say that our two governments have moved forward in a way that can bring even greater cooperation in the future."

Obama spoke after private talks with Chinese President Hu Jintao, as the two leaders began a larger round of conversations with members of their delegations. Both men were expected soon to issue statements.

In China for the first time, Obama joined Hu in sending cooperative signals. Their talks centred on nuclear proliferation, hurting economies, climate change, human rights, North Korea and Iran.

The pair sought to strike a balance between trading partners and competitors during Obama's weeklong trip to Asia.

"We believe strong dialogue is important not only for the U.S and China, but for the rest of the world," Obama said, flanked by his national security team as the session began with great ceremony.

Hu reciprocated with kind words in public: "I look forward to having an in-depth relationship."

The presidents met at the Great Hall of the People, located on the edge of Tiananmen Square.

The build-up to the meetings in China brought a cautious balancing from the first-term US leader.

A day before, Obama before prodded China about Internet controls and free speech during a forum with students in Shanghai. His message was not widely heard in the country" his words were drastically limited online and shown on just one regional television channel.

He also suggested that China, now a giant in economic impact as well as territory, must take a bigger role on the world stage - part of "burden of leadership" it shares with the United States.

"I will tell you, other countries around the world will be waiting for us," Obama said in an American-style town-hall discussion with Chinese university students in Shanghai, where he spent a day before flying to China's capital for a state visit with President Hu.

Eager to achieve a successful summit, the two leaders were likely to avoid public spats on economic issues. With America's budget deficit soaring to a yearly record of $1.42 trillion, China is the No. 1 lender to Washington and has expressed concern that the falling price of the dollar threatens the value of its US holdings.

In the US, American manufacturers blame China's own low currency value for contributing to the loss of 5.6 million manufacturing jobs over the past decade. During that time, America's trade gap with China has soared.

Obama's town hall meeting in Shanghai on Monday showed how difficult it is for the governments to work together. The US initially requested a larger venue and a live broadcast on a major network. In the end, Chinese officials put the event on the eastern fringes of the city. Only local Shanghai TV carried it live, though it was streamed on two popular Internet portals and on the White House's Web site, which is not censored.

In brief remarks before the initial talks, Hu noted Obama's Shanghai meeting with students, calling the session "quite lively."

Obama smiled broadly throughout the welcoming remarks late Monday, then told Hu that "the world recognizes the importance of the US-Chinese relationship" in tackling global problems.

The two met again - more formally - on Tuesday, complete with the military pomp of a welcome ceremony at the Great Hall of the People and a joint appearance before reporters. With sightseeing in Beijing's Forbidden City sandwiched in between, the two leaders' day was to end at a lavish state dinner in Obama's honour.

"Mr. President, let me say on behalf of the American people how very grateful we are for your hospitality," Obama said at the top of his first meeting Tuesday.

Obama was spending Wednesday in Beijing as well before completing his weeklong Asia travels in South Korea.
Topmost on Obama's ambitious agenda with Hu is the so-far elusive search for global agreement on a new climate change pact, stymied by disagreement between rich nations like the US and developing nations such as China. Wealthier countries want legally binding greenhouse-gas reduction targets for themselves as well as for energy-guzzling developing nations such as China, India and Brazil. Those poorer nations say they will set only nonbinding goals and they demand assistance to make the transition to harder targets.

Amid those differences, Obama and Hu are expected to announce new cooperation on a related but easier front: clean-energy projects. With China and the US the world's two largest emitters of heat-trapping gases, Obama warned that "unless both of our countries are willing to take critical steps in dealing with this issue, we will not be able to resolve it."

Another key area for Obama is securing stronger Chinese backing for halting the nuclear weapons ambitions of Iran and North Korea.

Beijing has supported sterner sanctions against Pyongyang for its continued nuclear weapons program. And, as North Korea's last major ally and a key supplier of food and energy aid, China is a partner with key leverage in six-nation talks with the North over the issue. But on Iran, where China has significant economic ties, Beijing has appeared less willing to endorse a tougher approach to restrict Tehran's uranium enrichment and suspected pursuit of atomic bombs.