COM 01/2017

Expert Opinions on the U.S. Election 2016

Duterte and Trump: Easy Bedfellows?

Filomeno V. Aguilar Jr., Professor in the Department of History and Dean of the School of Social Sciences, Ateneo de Manila University

Philippine President Rodrigo Duterte has been one of the first heads of government, if not the very first, to congratulate Donald Trump on the latter’s election as US president. On several counts, Trump’s victory is welcome to Duterte, but not necessarily to the Philippines. Although in May 2016 Duterte distanced himself from the American, saying “Donald Trump is a bigot, I am not,” on 9 November 2016 Duterte told a Filipino audience in Kuala Lumpur that he would cease to be quarrelsome as he had been toward President Barrack Obama. “I no longer want to fight now that Trump is there. I would like to congratulate President Trump.” Addressing Trump: “Mabuhay ka! The two of us both curse. At the slightest provocation, we curse.” Turning abruptly to his audience, Duterte said, “We’re sort of alike.”

Duterte deems the apparent similarities in their personal style, machismo, and flouting of social conventions important markers of interpersonal-cum-interstate relations. In the Philippines we would say, “Nakakuha ng katapat” (He has found his match). But he also probably appreciates Trump’s populism and ultranationalism, with the internet not lacking in photographs of both men clutching their respective flags during their run for office.

If the US under Trump pursues an isolationist foreign policy, it could mean that there might no longer be expressions of concern emanating from Washington over human rights violations in the Philippines, removing what the Philippine official considers not just an irritant but also a violation of state sovereignty. In such a scenario, a profit-maximizing USA Inc. will only be too glad to sell arms to the Philippines, reversing the current imbroglio.

If the US adopts a hands-off policy toward the maritime disputes in East and Southeast Asia, Duterte can happily deepen his pivot to China without Big Brother across the Pacific standing over the septuagenarian’s shoulders. Joint military exercises by China and the Philippines can be launched to replace similar exercises with the US, which Duterte wants discontinued. Japan may express alarm, apart from paying a high price for its security. But the Philippines can resort to ritual appeasement of Japan that, in the end, will not alienate the Philippines. Other countries in ASEAN may also be alarmed, but they can only squeak since the organization is deeply divided anyway and the world would seem to be heading toward a suum cuique dispensation.

If Trump succeeds in restructuring US economic policy to enforce protectionism, constraining US firms to scale back on business process outsourcing (BPO), the Philippines may lose some business but Duterte won’t complain as he will force his country to stand on its own feet (as he has already declared in regard to foreign humanitarian aid), all the better to be rid of this American capitalist tentacle. If the Trans-Pacific Partnership withers away, it would be of little consequence to the Philippines, which is not a party to this agreement.

The trouble with Trump, however, is that, as Alan Greenspan has said, he is an actor. And Trump can be a pretty convincing actor. After winning, he can and probably will amend substantially the script he followed during the campaign, as he has already signaled in relation to Obamacare, Obama’s healthcare bill, which he called during the campaign a “disaster” but key aspects of which he now wants to retain.

Once in office Trump will have to consider and act on the basis of “real” US strategic interests. He will understand the entanglement of US military presence worldwide and the health of the US economy. He will admit to the realities of an interconnected world that not even he can untangle singlehandedly. A “grand bargain” with China may be in the offing: Washington may accept China’s stake in the region and in exchange Beijing may accept the regional status quo, with the US remaining a dominant force.

The nuancing of Trump may catch Duterte running flatfooted.

Expectations on Trump’s foreign policy in Asia

Dr. Kevin Downey, Lecturer, Faculty of Political Science, Thammasat University

Expectations are that a Trump presidency will have a sizable impact on United States’ foreign relations in East and Southeast Asia. While this is a near guarantee, the types of impact are obscure. A paucity of information about policy and make-up of his inner circle makes predictions tricky. However, judging from President-elect Trump’s tweets, interviews, and public statements, his two greatest areas of impact will be in economic and military affairs.

Trump administration economic policy toward the Asia Pacific promises to be aggressive and protectionist. The two issue areas reported most in the media involved scuttling free trade agreements (FTAs) and the use of protectionist tariffs to shape competitors’ behaviors. Reportedly high on the President-elect’s agenda is dismantling the Trans-Pacific Partnership (TPP), a twelve-member FTA led by the United States and Japan. The grouping, which accounts for roughly 40% of global GDP, includes the ASEAN states of Brunei, Malaysia, Singapore and Vietnam; as well as regional partners Australia and New Zealand. President Obama had envisioned the TPP as the principal non-military means for containing Chinese economic expansion in the region. Nevertheless, Trump believes that such FTAs encourage the migration of American jobs overseas, reducing their true benefits.

A second economic strategy is the aggressive use of tariffs to punish states for currency manipulation and trade dumping. President-elect Trump has indicated tariffs upwards of 45% for China in response to artificial currency levels that lower the price of their exports. Other states could be punished for garnering advantages from imbalanced aid and trade agreements, or for failing to meet obligations on payments to the United States that would give them economic advantages. This is one aspect of Trump’s disdain for FTAs. It also corresponds to one of his military proposals, implementing cost sharing for regional defense.

The President-elect has asserted that the United States will no longer provide defense guarantees for states that will not compensate the US for its services. Within Asia, this places the traditional “hub and spokes” defensive arrangement including Japan as the primary partner, and states such as South Korea, the Philippines, and Australia at risk. Trump believes that security cost sharing is essential both to limit trade dumping by defense partners, and to offset the price of rebuilding America’s military. This is a core policy of the new administration, and calls for the construction of new capabilities across the four branches of the military.

Cost sharing and increasing military assets support the idea of “Peace through Strength” that Trump has resurrected from the Reagan era. It signals a retreat from international engagement and a new focus on entrenchment. Expect the US Navy to pull back to a 3rd fleet position, protecting Alaska, Hawai’i, and the American coast. Forward engagement in the South China Sea should be limited until forces are brought to strength.

We cannot yet know the true shape of a Trump administration’s approach to East and Southeast Asia, but it looks to be less proactive but more aggressive, a bold contradiction for the new President.

Impact of Current US election on Asia and Southeast Asia

Prof. Dr. Kriengsak Chareonwongsak, Senior Fellow, Harvard University, kriengsak@kriengsak.com, http:// www.kriengsak.com

With the result of the US election, Donald Trump, from the Republican Party, has been declared victorious. His policies display an emphasis on making the USA a world influencer once again. According to him, he will bring the manufacturing economy back to the US and he will not support much free trade. He will increase domestic demand, review free trade agreements and refrain from importing some goods to protect local US industries.

Trump has shown clear intentions to spurn refugees and foreign workers and to neglect some environmental issues. Regarding foreign policy, he looks to revise relationships and support new allied countries, especially concerning Asia. The ‘Pivot towards Asia” policy may not be the same.

When looking more into Asia, Trump proclaimed that he will not intervene and will not confront China. Thus, it will relieve certain tension between the two countries which will benefit Asia and will build more economic connections in future. But in the short term, it may have some impact on money and capital markets. The relationship between the USA and Asia will be transformed. Since the beginning of his campaign, Trump had announced that he will revise the Trans Pacific Partnership Agreement (TPP) of which Malaysia, Singapore, Brunei and Vietnam are current members. This may benefit Thailand which has not joined TPP. Or he might change it in to a bilateral deal which will be preferable to Trump.

Trump’s trade barrier policies will impact China, which is the biggest partner for exporting goods to the USA. Similarly, it may also impact Thailand and South East Asian exporting markets because they are in the same supply chain network.

Trump has no intention to focus on international political policies, so he is unlikely to intervene in South East Asian politics.
Regarding security issues, he clearly signalled that US military forces will be drawn back. Budget will be cut down and the US will let its allies such as Japan and South Korea take more responsibility for themselves.

Finally, the USA under Trump’s leadership and the Republicans that have the majority in both Houses will manifest more political stability. Policies and measures will be pushed forward easier. If good policies and measures will be implemented, it will positively impact the USA and the World Economy. The world’s geopolitics will surely be rocked in the near future.

Donald Trump’s black box

Jan Kliem, Program Officer, CPG, Bangkok

Tremors of the political earthquake that has shaken much of the world on the day of the US Presidential elections in 2016 are felt across the globe. Donald Trump has won the election, notwithstanding his inability to secure more votes than previous unsuccessful candidates Mitt Romney or John McCain. That he also failed to win the popular vote is an equally inconsequential side note owed to the particularities of the US voting system and its contentious electoral college.

Whatever the circumstances may be, the outcome has surprised many and the world wakes up to president-elect Donald Trump. Customary congratulations are flying in from all corners of the world, few have taken the opportunity like German chancellor Angela Merkel to deliver a clear message and enclose a certain conditionality to strong, future relations with the most formidable power on earth.

It is evident by now that by and large experts and polls were wrong about the number of people who would turn out to vote for Trump and it is a lesson that this particularly biased, fact-averse brand of populism, filling gaps of insecurity with misogynistic, racist assurances, attracts many more than just the uneducated ‘deplorables’.  Maybe a lesson can be learnt here as I have no doubt, if mainstream politics does not change and begins to recognise that certain sentiments are shared by significant parts of many societies, Europe might well follow suit with key political decisions coming up in the Netherlands, France, Austria or Italy. A night of vote-counting that to many experts, felt astoundingly similar to the recent Brexit vote may prove to be a wake-up call.

The consequences of a Trump presidency for the word in general and Asia in particular are notoriously difficult to call. Firstly, there are no actual policies to analyse as much of Trumps platform focused on diffuse ideas, norms and a general restructuring of how the US engages with the world. As a political newcomer there is little history to go on as well. Long held views as a business man or TV star may well alter with his new role in politics. Moreover, it remains to be seen how much content of his campaign he will actually carry over into his presidency. It is clear however, that his general rhetoric, at least during the campaign, spells problems for Asia. Should two of his main postulates, i.e. the re-shaping or even rejection of the post WWII alliance system and the US’s position as the guarantor of free-trade across the globe, come to materialise, tensions will inevitably rise across Asia.

With regards to the alliances, Japan and South Korea will have to reassess their defence strategies, particularly in the light of an ever more assertive China and a nuclear armed North Korea. Whilst Japanese prime minister Shinzo Abe still faces significant domestic opposition to his plans to re-define the role of the Japanese military, a lack of US security guarantees will give many the incentive to consent to new Japanese military ambition and to take it even further. A particularly dangerous elephant in the room here, and this is true for both Japan and South Korea, is the questions of nuclear armament if the US pulls its support. This would be the factual end of non-proliferation efforts of the last decades. Perhaps Trump’s comments on potentially revoking some of the guarantees of the US nuclear umbrella on the one hand, and his comments on how to deal with North Korea on the other show how little he understands (or thinks about) the international system and its arithmetics of power.

Countries in Southeast Asia will look to strike new bargains and co-operations with China which would in turn increase its influence in the region. The spread of democracy, rule of law and human rights would take a backseat as China’s ‘cheque book diplomacy’ follows a very different leitmotif. Here, alliances could shift and it is possible that we see more countries, such as Thailand or the Philippines moving closer to China.

So is this great news for China? To some extent, it certainly is. As Beijing looks to increase its influence in the region, a withdrawing US would be a significant boost. However, it must not be forgotten that China is part of those emerging markets that benefit hugely from what the USA is providing in the region. China’s economic well-being depends on the free flow of goods and free trade as it imports large amounts of commodities and export its products into the world. They too, and not insignificantly, benefit from the liberal world order and free trade system that the US has provided for decades. Should the US cede to fulfil this role, China would have to jump in and their focus would need to shift from just doing business to making sure that doing business remains possible and safe at reasonable cost. The same is true of course for other developing countries in the region. Thailand, Philippines, Vietnam and others all depend on free and secure sea lanes of communication for their economic growth. China is not at a stage yet where it can wholeheartedly support a US withdrawal from the region.

Having said this, a few caveats are in order which I have already alluded to above. At this stage, President Trump’s Asia policy remains something of a black box and to use a German proverb:  food rarely gets eaten as hot as it is cooked. This may be particularly true after (too) many months of an ugly campaign where facts and reason have rarely mattered most. News are already surfacing that Trump is backtracking on some particularly thorny issues, for example regarding South Korea. It has furthermore happened more than once that Trump has said one thing and his advisors have then later claimed he had meant another. Another point to keep in mind is that Trump’s policies could emerge to be much more refined than they have appeared so far. Not accepting that Japan for instance is ‘free-riding’ does not necessarily mean that the US would have to revoke all security guarantees. A re-negotiation does not need to end in an unreasonable deal although I personally believe that this is the potential beginning of a slippery slope and does send entirely wrong signals to the region.

The one thing we have more clarity on is the TPP. Since the election, it has grown ever more unlikely that the deal will go through during the lame duck period until January if that ever was a realistic possibility. Once the president-elect takes office, it will be all but dead. The TPP would have been an opportunity to mitigate some of the negative effects caused by the US’s decision not to get on board with the Asian Infrastructure Investment Bank. Trump instils confidence, at least in his voters, that he will be able to negotiate ‘better’ deals with China and others in the Asia-Pacific. So in a way, he was carried over the finish line by hope as much as by anger and divisiveness as so many pundits have argued. Come his first term and should politics and negotiating trade deals and security arrangements prove to be more complicated than they appeared in some of his campaign speeches, the only hope that remains will be the hope that there is more to him, and crucially his team of advisors, than it appears on the surface.

ASEAN in the Post-Trump Triumph World

Dr. Termsak Chalermpalanupap, a lead researcher on ASEAN political and security affairs at the ASEAN Studies Centre of the ISEAS—Yusof Ishak Institute in Singapore

One humble lesson we can all learn from the election victory of Donald Trump is to prepare for the unexpected. What is certain now is that our ASEAN region, in fact the whole world, will face more uncertainties. Conventional wisdom no longer holds. Unorthodoxy is on the rise. The way forward is to start thinking about the unthinkable. In that vein, this article puts forth three ideas based on Trump’s key (unchanging) beliefs.

I. Abandon the RCEP:

Trump strongly dislikes NAFTA and the WTO, and has repeatedly vowed to dump the TPP. He believes multilateral trade agreements kill jobs in America. In this light, we need to question what ASEAN can hope to achieve in leading the Regional Comprehensive Economic Partnership (RCEP) slow-going negotiations. The RCEP at best promises to deliver a complex but low-grade liberalization multilateral agreement (certainly much lower in quality than the TPP). It will not directly benefit working people in small ASEAN economies. Neither will it help SMEs in the emerging AEC, because few of them are involved in foreign trade, let alone overseas investment.

The RCEP process has failed to meet two deadlines in 2015 and 2016 chiefly because no participating governments are really interested in moving it forward. Brunei Darussalam, Malaysia, Singapore, and Viet Nam, as well as Australia, Japan, and New Zealand have all placed a higher priority on the TPP than on the RCEP. Even Indonesia, which is supposed to lead ASEAN in the RCEP talks, has shown official interest in joining the TPP. The Philippines and Thailand have also been considering jumping on the TPP bandwagon. So why is ASEAN still wasting time with the RCEP?

II. ASEAN First

Emulating Trump in campaigning for “America First”, we in the ASEAN Community must demand from our governments to pay more attention to addressing our intra-ASEAN problems, especially poverty, widening development gaps, and uncompetitive SMEs. We want “ASEAN First”. We want member governments to deliver on their numerous promises on building the ASEAN Community of prosperity in caring and sharing societies. Make the AEC create more good jobs for ASEAN peoples and new business opportunities for our SMEs.

Do not waste time worrying about the centrality or reputation of ASEAN in the international community. Our governments should spend their limited resources on building the ASEAN Community. ASEAN meetings and summits should resolve intra-ASEAN problems. Do not just meet to discuss problems without taking concrete decisions to resolve them. And more importantly, make sure ASEAN decisions are promptly carried out, and agreements are implemented in the true spirit of the ASEAN Community.

III. ASEAN Minus X

Another known strong view of Trump is the majority rule. ASEAN makes decisions by consensus. One unintended consequence of consensus is that ASEAN would only settle for the least objectionable, not for the most desirable. Every member government seems to enjoy having a virtual “veto” power to stop ASEAN at will. Unscrupulous member governments can then block decisions favoured by a majority in the ASEAN membership — even when their national interest is not really at stake.

It is now time for ASEAN to overcome the weakness of consensus by introducing the majority rule when consensus fails to arise. All should respect the majority will and support in good faith the common interest of ASEAN. Let us expand the ASEAN Minus X formula to all areas of cooperation, not just in optional participation in AEC projects, and move on.