Last week the U.S. moved forward with two steps for engaging with ASEAN, with the U.S. Congress finally passing legislation to implement the Asia Pacific Economic Cooperation (APEC) Business Travel Card, and U.S. business and policy leaders issuing a framework for future U.S. relations with ASEAN. Both developments should be welcomed, even though the former required more than a decade to get passed and the latter may take even longer.
The APEC business travel card was first implemented in 1997, with 18 APEC members now fully applying the card. The card allows businesspeople access to expedited travel lanes, without the need for country-specific visas. The card represents more than just shorter immigration lines for businesspeople. Rather, it represents a basic commitment to reduce regulatory barriers to trade and investment, in this case, immigration. That’s positive. What’s negative is that it required more than a decade to get the travel card adopted and implemented by the U.S.
Unfortunately, the card is only the latest example of the slow motion of U.S. trade and investment policy at the moment. This was also demonstrated by the 4+ years needed to get the Korea-U.S. free trade agreement through Congress earlier this year.
It was with that sanguine view of domestic U.S. politics that the U.S.-ASEAN Strategy Commission at the Center for Strategic and International Studies (CSIS) issued a set of proposals for advancing U.S. policy in southeast Asia. The Commission recommended several measures, including the negotiation of a U.S.-ASEAN free trade agreement (FTA) and a presidential or vice-presidential level business promotion campaign through the region. The report acknowledged that the current U.S. Burma sanctions prevented any immediate start to FTA talks, but that a U.S.-ASEAN FTA should be established as a long-term goal.
Given the state of U.S. trade politics, “long-term” is an understatement. Besides Burma policy, divisions between the Democrats and Republicans mean that any trade initiative will not make any meaningful progress until after the 2012 elections, and perhaps only with one party taking over both the White House and Congress. That’s possible, particularly if President Obama’s re-election campaign fails and the Republicans re-take the Senate as expected (when the Democrats had both Congress and the White House in 2009-2011, TPA and other trade issues were not a priority). In all likelihood only then would Congress delegate “trade promotion authority” (TPA) to the President to negotiate a comprehensive FTA; the lack of TPA affects the Trans Pacific Partnership (TPP) negotiations, although the Obama administration states that it can overcome this legislative hurdle.
Nevertheless, the CSIS recommendations correctly postulate that the TPP is an imperfect substitute for a U.S.-ASEAN FTA. The TPP is the potential basis for a Free Trade Area of the Asia Pacific, but as a result, the TPP talks are being conducted with one eye towards China, complicating matters. U.S.-ASEAN FTA talks, on the other hand, can focus exclusively on issues related directly to southeast Asia and the United States.
That does not mean that U.S.-ASEAN FTA talks would be uneventful. Besides Burma sanctions, the broad agenda for any U.S. FTA negotiations (going beyond the scope of FTAs that ASEAN has with China, Japan, Korea, Australia, India and New Zealand) would be controversial within ASEAN. Thailand and Malaysia would have to revisit issues that derailed their own bilateral FTA talks with the U.S., and Indonesia and the Philippines would have to face serious market access issues in their own countries. These issues, along with the less-developed nature of the ASEAN institutions, stalled the EU-ASEAN FTA talks, forcing the EU into bilateral FTA negotiations while maintaining the eventual goal of an ASEAN-level FTA. In all likelihood, the U.S. may have to pursue a similar approach.
Both developments are positive and should cheer U.S. supporters of the region. They are reminders that the United States remains committed to Asia Pacific and ASEAN in particular, even if one must be very, very patient.
