Thursday, November 19, 2009

Obama's Asian trip, success or failure

On November 12, President Obama began a 10-day journey to Asia, which included visits to Japan, Singapore, China and South Korea. The purpose of this trip, according to the White House, was to strengthen US leadership and economic competitiveness in the region, renew old alliances, forge new partnerships, and make progress on issues that matter to the American people. The trip included a number of bilateral and multilateral meetings, a Town Hall Event with Chinese youth and a visit to US troops in South Korea. But what if anything was achieved in this excursion.

In Japan President Obama met with Prime Minister Hatoyama and stated that a continuing bond existed between the two countries. He spoke of "shared values and shared interests" and said he intended to "find ways to renew this alliance and refresh it for the 21st century". While there was no clearly stated agreement on some issues other commitments showed the strong bond between America and Japan. Obama referred to the "powerful commitment of a $5 billion over the next five years to support our shared civilian efforts in Afghanistan, as well as the commitment of a billion dollars to Pakistan." But on climate change and nuclear proliferation in Iran and North Korea there was only stated goals rather than firmly stated proposals. Even Hatoyama while stressing the importance of the US-Japanese alliance revealed few hard facts. The two had only spoken for 90 minutes, giving little time to flesh out detailed agreements. Hatoyama did show he was committed to climate change however. "Now, in the area of climate change, again, we have talked on this subject. By 2050, we have set out this goal of an 80 percent reduction," he said "And both Japan and US have agreed on this, and we want to make COP-15 a success, and we agreed to cooperate towards this end."

Arriving in Singapore for the ASEAN-10 meeting Obama talked to several delegates and made an address following his discussions. Again actual facts and concrete proposals were thin on the ground. Obama spoke of a consensus with regards climate change, nuclear proliferation and trade but there was no real substance. There was only the stated importance of America's alliance with Asian countries in solving these issues and in particular furthering trade links. Obama proposed a "bold effort to achieve economic integration, which will contribute to a sustained and lasting prosperity within this region and throughout the world" but there was no plan laid out and he too admitted there was "much work left to be done".

Next stop was China, the focus of much media attention, and a controversial visit. Many hoped or expected Obama to raise issues of human rights, Internet censorship and issues of a de-valued Yuan. But although these were discussed or referred to, the words were not strong enough for many observers. The apparent obsequious approach was pragmatism on Obama's part given China holds much of America's debt. Obama's comments about a free uncensored Internet were censored in China and it is unlikely the Great Firewall will come down any time soon. Even his press conference with President Hu was little reported within China. And his call to restart talks with the Dalai Lama will probably fall on deaf ears. Even business issues such as the perceived under valued Yuan have not been widely discussed in Chinese media. Of course when Obama said his administration upheld the "one-China policy" this was reported by Xinhua within minutes. But not so when it came to more contentious issues.

The address given by Barack Obama as he stood aside President Hu in the Great Hall of the People was perhaps the briefest ever seen. Lasting only a few minutes Obama spoke of the extraordinary hospitality and said that the discussions had been "very constructive". The American people were interested in "stronger relations with the people of China," Obama said, "after 30 years of bilateral relations, I think it's fair to say that our two governments have continued to move forward in a way that can bring even greater cooperation in the future." However the fruits of the discussions about "economic issues, security issues, and global issues" were not revealed. 

Xinhua the state news organisation revealed little in the form of actual quotes. Despite meetings with President Hu Jintao, Premier Wen or Vice Premier Wu Banguo there were few details on their website.

Many Americans back home where unimpressed and dissidents were disappointed at Obama's China trip. But the criticism has been dismissed by some with Obama's administration. David Axelrod insisted the trip to China was not a failure and said, "This is not an immediate gratification business." The senior advisor went on adding, "We didn't come halfway across the world for tickertape parades. We came here to lay a foundation for progress. We've done that."

On the last leg of his Asian tour Obama met with South Korea's President Lee. But even here there were the much repeated statements heard throughout this trip. Writing in Forbes, Gordon Chang, author of the Coming Collapse of China, suggested the president should cross Beijing off his list of destinations given the "Chinese are not going to budge on anything important". As regards issues of "universal rights" much lauded by President Obama, Chang was also skeptical. "There will be statements and announcements, to be sure, but there will be little of substance in them. The White House will say that Mr. Obama talked to Chinese leader Hu Jintao about human rights, Taiwan and Tibet, for instance, but Beijing will not actually do anything in response," Chang said.

Obama has often cited a carrot rather than a stick approach when dealing with other nations. But China is rarely moved on anything it does not wish to. Chinese leaders have not taken steps to re-balance their economy, despite promises at the G-20 in Pittsburgh. Material support for North Korea increased last month and they have subsequently signaled they are likely to do the same with Iran. There is no evidence the Chinese have reduced the daily cyberattacks on the US. And attacks in other forms are also evident. They are still trying to undermine the dollar and in March vessels were ordered to attack an unarmed Navy reconnaissance ship in international waters in the South China Sea. It seems unlikely there will be any material Chinese concession either on the Doha Trade Round or Copenhagen climate change treaty. 

One could argue that many nations are only focused on their own self-interests. But it is becoming ever more apparent that Beijing is only interested in what it can obtain for itself. Last week President Hu said that he opposed "protectionism in all its manifestations". Yet there is no level playing field when it comes to business in China. Youku, China's video sharing website, operates unhindered and is host to much western copyrighted material. Google's YouTube on the other hand remains blocked. Facebook's Chinese user base has dwindled from more than a million to around 14,000 in the last few months due to its being blocked by Chinese censors. Even Google, with constant interference by authorities, has persuaded many to use Baidu, China's homegrown search engine. In the third quarter of 2009 Baidu had 64% of the 2 billion yuan ($318 million) Internet search market in China, while Google had 31.3 per cent. 

This has been going on for years and seems unlikely to change anytime soon. There have even been reports that the authorities rerouted requests for and other international search engines to Baidu's site. In 2002, Baidu had 3% and Google 24%. That same year there were already concerns over how censorship controls might affect business. "You have a lot of talent, not to mention money, that is being directed into controlling rather than stimulating the use of the web," Ken DeWoskin, a partner at accountants PricewaterhouseCoopers in Beijing, told the BBC nearly seven years ago. "It's like an enormous tax in terms of time and cost that is introduced into the use of the Internet for research... everything is just slow as molasses," DeWoskin said. 

In 2009 the Internet is little better. Social networks, which are fast becoming a business tool are of little use in China. Internet connections remain slow and unstable and there is little if any criticism by western governments directed at Beijing at how this is affecting commerce. Such hostility to the free flow of information not only affects western interests, it also affects Chinese ones. Beyond Tsingtao beer and low-end Haier refrigerators, "China has zilch brand presence in the U.S.," says Kenneth J. DeWoskin, who is now director of the China Research & Insight Center at Deloitte & Touche. Chinese companies of course do not use Twitter, Facebook, YouTube and other sites which are the mainstay of many western counterparts. As such they too will find a restrictive Internet impedes international growth and market presence. 

Beyond the Internet there are also issues of piracy and copyright infringement. Beijing claims it is cracking down on such practices yet fake DVDs, CDs and branded items from clothes to bags and watches are readily available. Recently a WTO panel ruled against Chinese restrictions on imports of audio-visual entertainment, including the use of domestic distributors to control access to the material, in response to a US challenge. It is these restrictions on foreign films that have in part fueled the pirate DVD market.

China has become a member of the WTO and yet it has been seen to ignore many of the rules set in place. A WTO ruling may be forthcoming which could set limits on blanket censorship and compel states instead to use more selective filtering. The European Centre for International Political Economy (ECIPE) says that "Censorship is the most important non-tariff barrier to the provision of online services, and a case might clarify the circumstances in which different forms of censorship are WTO-consistent." The study by Brian Hindley and Hosuk Lee-Makiyama say that already "many WTO member states are legally obliged to permit an unrestricted supply of cross-border Internet services" but that there needs to be more action to counter disproportionate censorship that disrupts commercial activities.

It remains to be seen if the WTO has a greater influence on Beijing than Mr Obama.

tvnewswatch, Beijing, China

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