At APEC, Obama’s Replacement Flies U.S. Flag as Best He Can

If American willingness to engage in Asia had been put in doubt by U.S. President Barack Obama’s no-show at the Asia-Pacific Economic Cooperation (APEC) summit in Bali, Indonesia, Secretary of State John Kerry on Monday attempted to reassure delegates of the U.S.’s commitment to the region with a passionate speech that pledged to embrace free trade and knock down trade barriers between the 21 member states.

“There is nothing that will shake the commitment of the U.S for the re-balance to Asia which President Obama is leading,” he said. Members of the APEC bloc, a grouping of Asian and American nations bordering the Pacific, currently boast half of world GDP, half of global trade and five of America’s top ten trading partners, said Kerry. “The Asia-Pacific region is by far the largest, fastest growing and most dynamic economic region in the world.”

Kerry was standing in for Obama, who withdrew at the last minute in order to tackle the ongoing federal shutdown at home. Malaysian Prime Minister Najib Razak summed up general mood when he talked of Obama missing “a golden opportunity” to show regional leadership. Kerry, by contrast, did his best to make light of the situation. “In 2004, I worked very, very hard to replace a president [but] this is not what I had in mind,” he quipped.

Indeed, Kerry’s speech made a concerted effort to dispel the common perception of a protectionist U.S. demanding safeguards for key industries, especially agriculture, from cheap foreign imports. By contrast, “protectionism is a problem because it stifled opportunity, crushes the energy of the marketplace,” said Kerry, adding that “history has proven again and again” the benefits of a free market. Chinese President Xi Jinping sounded a similar note, saying, “We should oppose all forms of protectionism.”

Russian President Vladimir Putin had the perfect opportunity to twist the knife when asked about the federal shutdown, but was more gracious than the giggling audience expected. “I believe that the decision of the president of the United States not to come here is a justified one,” he replied to a question from the audience, adding that he would also have stayed away if faced with a parallel domestic crisis. “The U.S. is the biggest economy in the world and much depends on how stable it feels.”

Most of the three-day business-focused APEC CEO summit centered on promoting growth and slashing trade barriers. Kerry used American giants Google and Apple as an example of how the U.S. fosters innovation, and called for the business sector to be “pushing governments forward.” Xi similarly spoke of “innovation-driven development” and reinforced Beijing’s commitment to providing “infrastructure assistance to developing countries in the region” through the setting up of an Asian Infrastructure Investment Bank.

Xi employed elaborate Chinese aphorisms during his time at the podium, seemingly trying to convince guests that China was still a vibrant economy despite posting a reduced growth rate of 7.6% for the first half of this year – still the envy of the developed world – by claiming that the slowdown had been engineered on purpose. “I’m fully confident about the future of China’s economy,” he said. “The fundamentals of Chinese economy are good. Everything has been going as expected and nothing has come as a surprise.” Xi explained that the partial slowdown had been due to a renewed effort to develop domestic infrastructure. “Draining the pond to catch fish is not sustainable,” he said cryptically.

Much of the Asia-Pacific Region depends heavily on Chinese prosperity; the Middle Kingdom was responsible for half of Asian GDP last year and ranks still as the largest trading partner of many APEC members. Putin emphasized the enduring importance of China in the region –  China-Russia trade amounted to $87.5 billion dollars in 2012, with the set goal of breaching the $100 billion trade this year. “We have a lot of areas of cooperation with China,” he said, pointing to shared pipelines and nuclear energy projects.

Putin also pointed to the urgent of upgrading infrastructure, pointing to gas and oil pipelines that his country had built to the Pacific and China as well as an enhanced Trans-Siberian Railway, but also the urgent need for better roads, airport and ports. “What is most important for China and Russia is infrastructure projects,” he said. “It is all very important for our joint efforts.”

But despite his assurances of future prosperity, Xi warned of “growing pains” as China’s economy enters “a new development stage” that will involve “hundreds of thousands moving from villages to cities in pursuit of a better life.” However, “we must not stop, even for a while, in our pursuit of reform and opening up,” and “rainbows often appear after wind and rain.”