In this webinar, Prof Soo Yeon Kim and Mr Marc Mealy explored the nexus between US domestic politics and trade policy, the prospects of the Biden administration’s Asia-Pacific trade strategy, and its possible implications for Southeast Asia.
REGIONAL STRATEGIC AND POLITICAL STUDIES PROGRAMME & REGIONAL ECONOMIC STUDIES PROGRAMME WEBINAR
Thursday, 24 March 2022 – ISEAS – Yusof Ishak Institute hosted a webinar on “The (Geo)Politics of the Biden Administration’s Trade Policy” delivered by Mr Marc Mealy, Senior Vice President-Policy at the US-ASEAN Business Council, and Professor Soo Yeon Kim, Associate Professor and Head of Department at the Department of Political Science, National University of Singapore.
Professor Soo began the webinar with an overview and comparison of the trade tariffs that China and the United States (US) have imposed on each other and on the rest of the world. Evidence supporting the theme of continuity in US trade policy from the Trump to Biden administration is apparent in several instances of renewals of tariff exclusions, restrictive measures against Chinese firms and recently, a tightened scrutiny of Chinese investments.
Next, Professor Soo delved into the topic of the absence of an American representation from key institutions in Asia. This includes notable developments such as the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP) and the Regional Comprehensive Economic Partnership (RCEP) agreements and other Asian institutions such as the Asian Infrastructure Investment Bank (AIIB). However, Professor Soo noted that the US could still continue to maintain its links and manage its relationship with China through the presence of member countries who have trade or economic agreements with the US. Further discussion about the benefits of a presence in Asia followed through an examination of the countries that enjoy a percentage gain in vote share from joining the AIIB.
Professor Soo continued to discuss the impact of the US-China trade war by turning to study the trade war from the Chinese perspective. In particular, the topic of how China’s foreign economic activities impacted global trade and investment networks, with an emphasis on third-world countries and its global consequences, was broached. Professor Soo posited that countries which are established trade partners and investment destinations for Chinese firms are likely to see their centrality enhanced since the onset of the trade conflict. She theorised that these firms would seek to minimise risk by engaging in economic activities with familiar and friendly countries. This was bolstered by active support from the Chinese government with the imposition of policies and agreements that encourage economic investment and cooperation. After a more detailed elaboration of the study and its impact on ASEAN centrality, Professor Soo concluded her presentation with some food for thought on the continuity of US trade policy and the role ASEAN countries could play in the future.
The webinar was then passed onto Mr Mealy who characterised the evolution of US trade policy over time. Domestic political sentiments surrounding trade, stemming from an unequal distribution of benefits from trade policy, have played an increasingly prominent role as it shifts from liberalisation to trade enforcement. Mr Mealy outlined three distinct periods of change, including the first period before 1999, where barring a few exceptions, trade policy was more technical than political in nature. The years between 1999 and 2010 saw heightened links between American politics and trade policy, such as that of permanent trade relations with China in 2010. This was closely followed by the advent of the 2010s which witnessed a gradual readjustment of policy from Free-Trade Agreements (FTAs) and trade liberalisation to that of trade deficits and an increasing focus on trade enforcement due to the growing voice of domestic politics and its expanding influence on the formulation of trade policies. Mr Mealy opined that the current stance of US trade policy remained one of continuity of trade enforcement with, however, an elevation of labour rights and environmental protection, the employment of new and creative tools in shaping the direction of traditional and digital trade policy, resetting public sentiments around trade, and a return to establishing a trade presence in Asia. Future trade policies will therefore be innovative and different from existing and traditional approaches.
The webinar concluded with the speakers answering questions posed by the audience, such as the interest in resolving the trade war between China and the US, the impact of the US’s supply chain resilience on Southeast Asian economies, the possible form of the Indo-Pacific Economic Framework (IPEF), likely sectors and partners as well as the impact that the war on Ukraine may have on the direction of US trade policy.