The World : Clinton’s Task in Asia: Wooing a Partner With Independent Ways

When Air Force One sets down in Jakarta today, Bill Clinton will try to reassure anxious Asian leaders, gathering for an Asia Pacific Economic Cooperation summit, that he is still in charge of U.S. policy toward the region. A year ago, the President strutted to Seattle to host the conference armed with a congressional OK for the North American Free Trade Agreement. This year, he shows up without similar approval for a new global-trade accord, or even “fast track” authority to negotiate the trade pacts that will be a central theme in Indonesia.

The irony is that although Clinton was weakened on Election Day, his Asian policy has been increasingly in tune with Asian trends. Last May, he wisely decoupled human rights from China’s trade status. In September, he put aside sharp words and negotiated a modest trade accord with Japan. And after edging to the brink of conflict with North Korea, he reached a deal that, if implemented, could end Pyongyang’s nuclear threat.

This hardly amounts to the ambitious “New Pacific Community” that Clinton has called for. But his Administration is learning and, along the way, recouping some of its lost credibility in Asia. The challenge in Indonesia will be to demonstrate to Americans back home that U.S. economic and political engagement in Asia is good for the country and that its price is not abandonment of human rights. As for Asians, Clinton must persuade them that the United States will be a reliable, long-term partner, not an imperious, condescending one.

Even in the best of political times, balancing these competing and sometimes conflicting goals is a near impossible task. With some $360 billion in two-way trade across the Pacific--one-third of U.S. exports--and about 3 million jobs depending on our continued ties to the region, the stakes are enormous.

But Americans, generally, and the Administration, particularly, have a rough time facing a central fact: Our stake in East Asia is increasing even as our leverage is decreasing. East Asia has come of age. It is no longer dependent on U.S. aid and less dependent on U.S. markets. Japan and Taiwan now trade more within Asia than with the United States. The enormously high Asian savings rates allow East Asians to invest more and more in each other’s economies. And although the U.S. military presence and various security alliances remain crucial to regional stability, East Asians are now talking about ways to ensure their own mutual security and are modernize their own military forces in anticipation of a diminished U.S. role. But they all want us as a major partner.

The measure of Clinton’s success, or failure, at the conference will be twofold: Will the APEC forum be strengthened, and will the United States come away with stronger and more stable relations with host Indonesia?

The debate within APEC is over whether to commit all its 18 members to achieving a Pacific free-trade zone by a certain date. While freer trans-Pacific trade is a noble goal, there is real danger that grandiose visions may undercut more practical approaches and support for the Asia-Pacific group.

Few Asian economies are as open as that of the United States. Many of their trade barriers are not traditional ones like tariffs but invisible or structural hurdles, such as Japan’s clubby business culture and labyrinthine regulations or China’s lack of clear rules. For Clinton, whose Administration barely got NAFTA through Congress because of congressional worries about Mexican cheap labor, raising the specter of free-trade accords with China and Indonesia, the world’s largest pool of cheap labor, would be a protectionist’s delight.

Moreover, five years after its inception, Asian Pacific Economic Cooperation has yet to achieve any concrete results. While there is no harm in upholding a vision of an open-trade zone, Clinton would be wise to put the focus on a building-block approach to such issues as harmonizing standards and customs procedures and liberalizing important sectors like telecommunications. APEC must demonstrate to the private sector its ability to facilitate trade and investment in the near term.

The matter of improving U.S.-Indonesian relations is as important--and difficult. There are a host of contentious issues--human rights, labor rights, press freedoms, repression in East Timor, to name a few--on the table. But Indonesia is a dynamic society in transition. It is a major oil and gas producer, the largest Islamic nation and a country that favors a U.S. security role in Asia, working closely with Washington on regional issues like the Cambodia peace accord.

Indonesia is also a metaphor for the tension between interests and values that dogs U.S. policy in Asia. One can focus on Indonesia’s human-rights problems (and there are many) and threaten to cut back already miniscule amounts of aid, or one can pursue a course of constructive engagement. Indonesia is also representative of larger trends in Asia, all favorable to U.S. goals: Jakarta has been slowly, but steadily, deregulating its economy, opening up its markets, and welcoming foreign investment. Although autocratic, human-rights and labor groups are permitted to operate, though all too often face repression.

As Indonesia’s economy has expanded at a 6% annual clip for more than two decades and has diversified from oil, gas and timber into manufacturing, a class of technocrats (many educated at UC Berkeley) has come onto the scene to steer its success. In the last 10 years, the experience in Asia has been that such economic dynamism produces large, urban middle classes who gradually demand more pluralist, accountable governments. Democratization occurred in the Philippines in 1986, in South Korea in 1988, and more recently in Taiwan and Thailand. There are bound to be setbacks, as at Tian An Men. But the trends are clear.

Clinton would thus be well-advised to pursue a policy that understands Asian dynamics, exhibits patience as well as firmness and forges a more equal partnership across the Pacific. It is a challenge we must meet, and an opportunity that could put new energy into the Clinton presidency.*