Apec Summit Ends Without Statement Over US-China Trade Rift

by Bamidele Ogunberu Posted on November 19th, 2018

Port  Moresby, Papua New Guinea: The Asia-Pacific Economic Cooperation summit ended without a formal statement from leaders for the first time as trade tensions between the United States and China loomed over the meeting.

The United States and China turned a Pacific Rim trade summit this weekend into a stage where the world could do little more than stand by and watch as two great powers aggravated their battle over trade.

President Xi Jinping and Vice President Mike Pence both made their cases to the global leaders assembled in Papua New Guinea — then they dug in and refused to compromise. That left the group of 21 nations in disarray, unable to agree on even a routine joint statement like those that had closed every other Asia Pacific Economic Cooperation summit since 1989.

Countries caught in the trade-war crossfire between China and the United States are becoming increasingly exasperated.

“The entire world is worried,” said Prime Minister Peter O’Neill of Papua New Guinea.

The disagreement over the final statement reflects a hardening of the conflict between China and the United States, with each side deploying aggressive, uncompromising rhetoric reminiscent of that heard during the Cold War.

During a weekend of diplomacy in China’s backyard that had been meant to defuse trade tensions, Mr. Xi and Mr. Pence instead chose escalation, attacking each other’s positions and battling for loyalty within a trade group that represents 60 percent of the global economy.

Experts said the stalemate at the Asia-Pacific Economic Cooperation summit, known as APEC, would set up a high-stakes showdown at the Group of 20 conference in Argentina this month, which Mr. Xi and President Trump are expected to attend.

The core issues in the clash were familiar and have shaped the trade dispute between the United States and China for months.

Mr. Trump has made a combative stance on trade a signature element of his administration’s foreign policy. So draft versions of an APEC communiqué showed that the United States wanted strong language condemning Chinese trade practices it calls coercive and predatory. Among them: restricting market access and pushing foreign companies to hand over valuable technology.

The Chinese delegation sought to reaffirm its opposition to what it says are protectionism and unilateralism by the United States, especially the tariffs Mr. Trump has imposed on $250 billion worth of Chinese goods as part of an unprecedented effort to force China to change its policies.

Mr. Trump’s trade offensive has stoked fears of an economic Cold War between the world’s two largest economies. While the president has sought to preserve cordial personal relations with Mr. Xi, the broader relationship between the United States and China has deteriorated steadily, not just in the commercial sphere but also in security issues like the South China Sea.

Mr. Xi seemed eager to shore up ties with an important trading partner, North Korea. He told President Moon Jae-in of South Korea on the sidelines of the trade forum that he was considering accepting an invitation from the North’s leader, Kim Jong-un, to visit, a spokesman for Mr. Moon said.

Such a visit, as well as any additional support for North Korea at a time when its nuclear promises are falling short of American demands, could bring a new round of threats that go beyond trade to global security.

But at the APEC conference in Port Moresby, the capital of Papua New Guinea, the tensions centered on economics.

For years, American foreign policy has sought to balance the economic benefits of cooperating with China with the risks of treating the country as an adversary.

Now, the scales have tipped.

From Mr. Trump’s tweets to defense position papers and a major speech by Mr. Pence on Oct. 4, the United States has made clear that it sees China as a strategic threat.

“It’s a new level of Cold War rhetoric,” said Hugh White, a prominent regional analyst at the Australian National University.

Economic cooperation, he said, is being sidelined.

“The Trump administration, for the first time since Nixon in 1972, has sought to distance America from China’s economic opportunities,” Mr. White said. “That’s a huge shift.”

Mr. Pence has played an especially prominent role in the confrontation.

Appearing in Mr. Trump’s place at APEC, he doubled down on recent criticism of China’s geopolitical strategies and attacked the country’s “One Belt, One Road” initiative — an infrastructure plan financed by China that covers some 70 countries.

He urged Asian nations to work with the United States. If they do, he said, they will not be saddled with debt, a problem some countries are facing as a result of their partnerships with Beijing.

Mr. Xi, who spoke before Mr. Pence, insisted that such criticism was misguided. China’s infrastructure plan, he said, is inclusive and beneficial.

“It will not close a door and create a small circle,” Mr. Xi said. “It is not the so-called trap, as some people say. It is the sunshine avenue where China shares opportunities with the world to seek common development.”

Experts said the two countries’ positions have become more entrenched.

“It boils down to mutual intransigence between the U.S. and China,” said Rory Medcalf, head of the National Security College at the Australian National University.

Jonathan Pryke, a Pacific Rim expert at the Lowy Institute, agreed, describing the result as raw “stubbornness.”

Earlier on Sunday, Prime Minister Scott Morrison of Australia tried to sound upbeat. “I think there is a lot more progress being made here than I think is probably being acknowledged,” he said.

He and many other national leaders seemed eager to return to a time when the world’s strongest powers got along, or at least worked together on building the world economy.

What the leaders of many countries fear, especially in Asia, is a cleavage into two camps.

No one “wants to be forced to make a choice,” said Mr. White, the analyst.

For now, the world beyond the United States and China seems to have been given the task of maintaining calm — and of trying to steer the world away from economic divisions and greater clashes.

By Sunday night, it was increasingly difficult to see the summit meeting as anything but a continuation of hostilities.

Prime Minister Justin Trudeau of Canada was among the first to make that clear. The joint statement, he said, was a lost cause.

“I don’t think it will come as a huge surprise that there are differing visions,” he said.

EARLIER : USA, China Divisions Take Center Stage At APEC CEO Summit

U.S Vice President Mike Pence vowed no end to tariffs until China bows even as Chinese President Xi Jinping said here on Saturday that amid profound changes in the global landscape, mankind has reached a crossroads and is faced with critical choices.

The United States and China swapped barbs over trade, investment and regional security at an Asia Pacific Economic Co-operation (APEC) summit on Saturday, as growing fault lines among members suggested little prospect of consensus at the weekend meeting

In a keynote speech at the APEC CEO Summit in the capital of Papua New Guinea, Xi pointed out that the world is encountering changes not seen in a century and mankind has once again reached a crossroads.

He stressed that the interests of all countries and the future of mankind hinge on the choice between cooperation and confrontation, between openness and closing one’s door, and between win-win progress and a zero-sum game.

Speaking in the Papua New Guinean capital, U.S. Vice President Mike Pence said there would be no end to American tariffs until China changed its ways, after its president, Xi Jinping, warned that the shadow of protectionism and unilateralism was hanging over global growth.

In a bluntly worded speech at an Asia Pacific Economic Co-operation (APEC) summit in Papua New Guinea, Pence threw down the gauntlet to China on trade and security in the region.

“We have taken decisive action to address our imbalance with China,” Pence declared. “We put tariffs on $250 billion in Chinese goods, and we could more than double that number.”

“The United States, though, will not change course until China changes its ways.”

“China has taken advantage of the United States for many years. Those days are over,” he told delegates gathered on a cruise liner docked in Port Moresby’s Fairfax Harbour.

He also took aim at China’s territorial ambitions in the Pacific and, particularly, Xi’s Belt and Road Initiative to expand land and sea links between Asia, Africa and Europe with billions of dollars in infrastructure investment.

“We don’t offer constricting belts or a one-way road,” said Pence.

While not referring directly to Chinese claims over various disputed waters in the region, Pence said the United States would work to help protect maritime rights.

“We will continue to fly and sail where ever international law allows and our interests demand. Harassment will only strengthen our resolve.”

Just minutes earlier, Xi had spoken at length about his initiative and the need for free trade across the region.

“It is not an exclusive club closed to non-members, nor is it a trap as some people have labeled it,” Xi said of his brainchild project.

He also called protectionism a “shortsighted approach” that was “doomed to fail”.

“History has shown that confrontation, whether in the form of a Cold War, hot war, or trade war will produce no winners,” said Xi.

China’s efforts to win friends in the resource-rich Pacific have been watched warily by the traditionally influential powers in the region – Australia and the United States.

Xi stoked Western concern when he held a private meeting with Pacific island leaders on Friday, where he pitched the Belt and Road initiative.

Speaking before Pence, Xi said there was no geopolitical agenda behind the Belt and Road plan, which was unveiled in 2013 and aims to bolster a sprawling network of land and sea links with Southeast Asia, Central Asia, the Middle East, Europe and Africa.

“It does not exclude anyone. It is not an exclusive club closed to non-members, nor is it a trap as some people have labeled it.”

There have been concerns that small countries that sign up for infrastructure projects will be left with debt burdens they cannot service, something Pence highlighted.

“Do not accept foreign debt that could compromise your sovereignty. Protect your interest. Preserve your independence. And just like America, always put your country first,” he said, adding that the United States was a better investment partner.

Sri Lanka formally handed over commercial activities in its main southern port in the town of Hambantota to a Chinese company last December as part of a plan to convert $6 billion of loans that Sri Lanka owed China into equity.

U.S. President Donald Trump is not attending the APEC meeting, nor is Russia’s president, Vladimir Putin.

Trump and Xi are due to meet at a G20 meeting in Argentina late this month, raising some hope that trade tension could ease.

“Global growth is shadowed by protectionism and unilateralism,” Xi told delegates, saying that erecting barriers and cutting ties was a short-sighted approach doomed to fail.

But Pence made it clear that the United States would not back down.

“The United States though will not change course until China changes its ways,” he told delegates gathered on a cruise liner tethered in Port Moresby’s Fairfax Harbour.

“We put tariffs on $250 billion in Chinese goods, and we could more than double that number.”

Trump is pressing China to reduce its huge bilateral trade surplus and make sweeping changes to its policies on trade, technology transfers and high-tech industrial subsidies.

China has denied that U.S. companies are forced to transfer technology and sees U.S. demands on rolling back its industrial policies as an attempt to contain China’s economic rise.

The APEC CEO Summit is the premier business event in the Asia Pacific region. It gathers World Leaders of the 21 Pacific Rim member economies, as well as Top Business Executives and Innovative Thinkers, to converse on how to secure shared development and achieve inclusive free trade and investment across Asia and the Pacific.

Under the Theme of “Inclusion in the Age of Disruption: Charting a Common Future”, the summit will provide an exceptional platform for leaders to speak and discuss critical issues and engage in interactive dialogue on the best path forward.

This year’s APEC CEO Summit  is taking place on board the luxury P&O cruise liner, “The Pacific Explorer”, which  is docked in Port Moresby, Papua New Guinea.

The APEC CEO Summit is the most influential meeting of business and government in the Asia Pacific. The Summit provides opportunities for CEOs and top business executives to engage in dialogue with Heads of Government and Economic Ministers, discover opportunities, and forge connections with business and thought leaders from around the world.

What is APEC?

The Asia Pacific Economic Cooperation is an important framework for advancing the prosperity of people and societies in the region. Together, APEC governments and business achieve this by deepening economic cooperation, improving the environment for trade and investment, ushering inclusive and sustainable growth, and adapting innovative measures.

Its 21 member economies participate in the process: Australia, Brunei, Canada, Chile, China, Chinese Taipei, Hong Kong, Indonesia, Japan, Malaysia, Mexico, New Zealand, Papua New Guinea, Peru, the Philippines, Russia, Singapore, Korea, Thailand, the United States and Viet Nam.

What is the APEC CEO Summit?

The APEC CEO Summit is Asia-Pacific’s premier business event and most influential meeting.

No other international conference features 10 APEC Leaders in the program each year (including those from the most powerful economies), who dialogue with CEOs and senior executives of leading global/regional companies and many of the most successful entrepreneurs. The APEC CEO Summit provides unmatched potential to build networks, influence thinking at levels as high as APEC Leaders, and take away relevant insight.

The APEC CEO Summit Program

The two-day APEC CEO Summit program engages delegates on some of the most pressing challenges and questions in the world today.

Program sessions include the State of the Global Economy, Pursuing Inclusive Growth, Innovation and the Digital Future, Climate Change, Trade, and other foremost issues which affect how business is done and how solutions ultimately translate to a better world.

The program typically features the participation of several Presidents and Prime Ministers of Asia Pacific economies, including that of the United States, China, Russia, Japan, Korea, Australia, Singapore and Hong Kong.

Who attends?

The APEC CEO Summit is by-invitation-only. This year’s Summit aims to bring together 500-600 Chairmen, CEOs, and top global and regional corporate decision-makers; visionary entrepreneurs; senior figures in politics and highly-recognized thought leaders and notable members of civil society.

The Host Country 2018: Papua New Guinea

Papua New Guinea is rich in mineral, agricultural, forestry and fisheries resources. Development is in the early stages, and government policy is focused on steady, sustainable growth with an even sharing of the benefits throughout the country.

Agriculture provides a subsistence livelihood for 85% of the people, and mineral deposits, including copper, gold, and oil, account for nearly two-thirds of export earnings.

The Government, under the leadership of Prime Minister Peter O’Neill is prioritizing and promoting investor confidence, efficiency of state institutions, and good relations with its neighbors and the wider global community.

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