Heads up, ASEAN 10!



FOLLOWING the Asian, European and American developments over the past three weeks, the immediate and intermediate future for the Association of Southeast Asian Nations (ASEAN) looks pregnant with opportunities for economic progress and relaxation of military-political tensions in the Asia-Pacific region.

This is obvious at least to some of our fellow members in the private, non-government and non-sectarian think tanks, the Philippine Center for Philippine Futuristics Studies (Futuristics Center) and the Philippine Council of Foreign Relations (PCFR).

In anticipation of the transition of the American political leadership from the Obama to the Donald J. Trump presidency (with the inauguration of President Donald J. Trump last Friday, Washington D.C. time), Chinese President Xi Jinping used the World Economic Forum (WEF) a week earlier to announce that Beijing would actively support and finance international deals to hasten development in poor—developing and underdeveloped—countries.

From where I sit, clearly it was a smart propaganda move—salesmanship if you wish—on China’s part. Xi was trying to convince the world that China’s One Belt, One Road (OBOR) foreign policy is better than that of any of the superpowers. It was launched when Xi took over as chairman of the Chinese Communist Party and its ruling Central Committee (Politburo), commander-in-chief of the Peoples Liberation Army and China’s President three years ago.

It was not really hard to guess that Xi, who had consolidated his absolute control of his country’s leadership, would probably do exactly what he did in Davos because the free American media and international news networks had openly covered the US presidential campaign throughout.

Trump had campaigned to bring back home to the US investments and businesses overseas to generate incomes for the increased (under the eight-year Obama regime) jobless Americans, resuscitate the declining economy (now threatened by China’s economic surge over the last 30 years, though slowing down now), restore defense spending to boost its technical and striking powers over Russia and China, and raze the international terrorist extremist Islamic State.

In short, President Trump won on the promise of better life for Americans at home and to maintain US hegemony, particularly in the Asia-Pacific region, which has been weakened with the budgetary cuts down to $500 billion annually during Obama’s two-term regime.

On the other hand China had been increasing its armed forces expenditures up to the $500 billion mark—and built its first aircraft carrier, the Liaoning–since it overtook Japan as the world’s second (to the US) economic power two years ago.

This situation, plus the continuous aggressive Chinese military buildup in the South China Sea–including in the West Philippine Sea which is part of the Philippines’ exclusive economic zone under the United Nations Conference on the Law of the Sea (UNCLOS)–has intensified geopolitical-military tensions in the Asia-Pacific region.

Thus, the need for China now to boost its diplomatic offensive and use the economic capability and financial resources it has amassed to attract more allies from its immediate neighbors in Central Asia, South Asia, Southeast Asia and Africa.

Apparently, China has given up the Northeast Asia region dominated by US allies Japan, South Korea and Taiwan (which China considers its renegade province but with its own military and economic resources and government).

The recent Pacific Ocean run of the Liaoning, from its Dalian home base in northeastern China, and passing close to the Taiwan territorial waters (before last week’s Trump inauguration), was an indication that China was testing how the new Republican Party regime in Washington would react to Chinese military initiatives.

We in the ASEAN 10 probably will not have to wait long to find out.

Europe is undergoing a painful divorce process with the United Kingdom, undertaking the two-year negotiation to complete Brexit, and Britain’s cessation of its dealing with the European Union. London will undoubtedly depend on its British Commonwealth (of former colonies, which is the biggest single group of economic allies) for its economic competitiveness and survival.

One of the anticipated negative impacts of Brexit, as financial institutions have so far aired, is the devaluation of the pound against the other currencies in the international market as demand for the British pound will diminish with the immediate slide of its economy. But look at it from the other side. A devalued pound will make it tougher for the British manufacturers to import raw materials, but exporters will benefit because it can get more pound for its sale to other countries. And British factories can depend on its Commonwealth members (like Malaysia, Myanmar, India, in Asia) plus the Middle Eastern countries for raw materials.

Another possibility is for British factories to relocate in the Commonwealth member countries for cheaper labor, power and overall production costs–and in the medium and long run, earn better for their exports.

To be affected most by Trump’s call for American investors to return home is China, where US manufacturers migrated more than a decade back) because of low labor (no strikes as ordered by the Communist Party) power (using cheap but highly polluting dirty coal) and overall production costs. Beijing created its five free economic zones in its southeastern province facing the South China Sea.

China’s biggest export market is the US. Effectively, the Chinese economic rise has been driven by the average American consumer who wants cheap goods when and where he wants them. Beijing will be grossly affected if and when Trump succeeds in incentivizing the American investors to come home. One negative economic factor immediately will be labor costs as American average incomes are higher than most of the world’s. But expect innovative thinking and management savvy of the Americans to go for more robotics, including drones, to save on manpower costs. They have and control most of the technologies in these fields

The risk of another world war is far more remote unless one miscalculating military field commander fires the first shot because the biggest consideration now is the economy. The reconstruction after the war will be costlier than the destruction. Top priority of the world’s seven billion plus population—and the United Nations’ too–is still eradication of extreme poverty. Just go through last week’s special feature of the Associated Press. Eight of the world’s billionaires hold the valued assets of half of the world’s population!

This present global picture looks more like the third Cold War where the tools used are all in the fields of trade, financing, education, demography, technologies, and the environment (climate change)—for hegemonic competition. The active leaders expectedly are the US and China with Russia a smiling bystander who will pick up the pieces and take over from the loser

The first Cold War began when the Russian (Bolshevik) Revolution massacred the Romanov family in 1917. That actually began the ideological conflict between communism and capitalism—impoverished labor versus management and the rich.

The second began in the 1960s with the arms and space race with communism losing with the destruction of the Berlin Wall and the eventual dissolution of the Soviet empire (by Premier Mikael Gorbachev who realized military spending yields zero return on investment). Remember his 1985 Vladivostok speech for glasnost and perestroika?

This Cold War today looks tame but it is more deadly as food and water security kills slowly and more painfully than bullets, bombs and other explosives. And the global warming caused by environmental degradation and carbon emissions will predictably sink 30 percent of the world’s urban areas.

We still have to see how Trump will manage to convert into reality his campaign promises.

But for the ASEAN 10, all these “challenges” or risks have the equivalent opportunities for progress. It is just a matter of the political-economic leaderships empowering their people by providing the quality education for logistics or resources managers because all the ASEAN members are rich in natural resources, including the demographics. Keep in cadence with diplomacy and information technologies with the global community.

On top of it all, be best informed of current conditions and see the future—the key to survival in this age.

Comments and reactions may be emailed to gilshj99ph@yahoo.com. Gil H A. Santos is professor of journalism and geopolitics at the Lyceum of the Philippines University, president of the PCFSM and veteran news correspondent for the international news organizations for more than 60 years.


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