The real story behind Abe and Park's strange body language

YaleGlobal Online, a leading US journal on global affairs, features an article dated 10 October, 2013, showing in vivid body language at the recent Bali APEC Summit the rift between Japan and South Korean, despite wishes by the United States to broker an eventual  rapprochement. Click here

The YaleGlobal summarizes it well:

"Japan and South Korea are each close with the United States and could be strong allies, after adequate atonement and forgiveness for historical atrocities. But instead the gulf is widening, as indicated by a terse exchange between the two leaders attending the Asia Pacific Economic Cooperation summit, suggests journalist Shim Jae Hoon. The most recent point of contention: US-Japan Defense Cooperation guidelines will be renegotiated, likely strengthening Japan’s independent military capability, allowing new interpretations of the Japanese constitution which prohibits rearmament and perhaps even making the nation a US proxy for regional security. South Korea, alarmed by lack of notice, fears a new arrangement could limit its own strategic options and decrease leverage with China on handling North Korea. The US also negotiated agreements with South Korea. South Koreans worry that the US, with so many budgetary challenges, is relinquishing its leadership role in the region. The US president did not attend the APEC summit, but China's did. China’s President Xi assured South Korea’s President Park that it can control North Korea."

The elephant in the room is of course is the intensifying U.S.-China rivalry. The unspoken strategy is captured in a front-liner. “The US is outsourcing its anti-China policy to Japan,” announced a front-page headline in the conservative Chosun Ilbo newspaper in South Korea on October 6 shortly after Hagel’s Tokyo agreement strengthening US-Japan military alliance.

The conundrum is that while the US wants to build closer US military ties with all of China's neighbors under the Asia Pivot strategy, a China-containment strategy in all but name, most of them have China as their largest trading partner. So, while welcoming a US military umbrella as a hedge against China, very few (mainly those whose economies are not overwhelmingly dependent on China, such as the Philippines and Vietnam) want to antagonize China too much.

For South Korea, there is also the vital issue of North Korea on which China is seen better as a strategic ally rather than a foe.

On the economic front, the Asia Pivot takes the form of the Trans-Pacific Partnerhip (TPP) which, tale-tellingly, excludes the world's second largest economy - China- at least initially. The idea is to bring all of China's neighbors into a US-defined norm and to open up more regional markets for US economic influence. To start with, a string of traditional US allies such as Australia and New Zealand and several Asian countries have started preparations to join. Nevertheless, internal oppositions in some Asian countries, such as Japan, remain as vested interests resist further opening up of certain sectors, like agriculture, to America.

However, the most glaring reality that stares the TPP in the face remains China's now unalterably becoming the heart of a regional and global supply and production chain, supported by most of the world's top container ports on her eastern seaboard. Some of the production processes are diverted to China's neighbors but they can't displace China's massive scale and economic efficiency built with decades of compliance with international requirements. As for the promise of 3-D printing to bring back most jobs to America,, the technology is no rocket-science and China has already started to employ it where appropriate, as in aviation and space projects.

To cement China's pivotal role in international container-shipping, a new project has been recently approved by the Nicaraguan Congress which give a 50-year concession to a Hong Kong-based Chinese firm to build and operate a much wider and deeper rival to the Panama Canal. This will facilitate passage of the world's largest container ships which can now only be accommodated in Shanghai's Lianyungang. The early-days-yet quiet following the official approval somehow belies the dramatic project's epic significance. Click here

The TPP is unlikely to fulfill its promise of a game-changer to curb China's economic influence in the region and beyond. Indeed, as China's economy is set to overtake the US within a decade or so, such influence is likely to grow even stronger. This is being supported by China's move to speed up the internationalization of the RMB in terms of currency swaps (including London and the European Central Bank (ECB) recently) and issuance of more RMB- denominated bonds. Its capital account convertibility is now being experimented with in newly-created Free Trade Zones in Shanghai and Qianghai, near Hong Kong.

Meanwhile, in the light of the huge US debt mountain and reckless QE money-printing, the G-20 have been pressing for a greater role of the Special Drawing Rrights (SDR) of the IMF to keep the global currency system on an even keel, giving a greater role to emerging powers like China. The days when the RMB would become at least one of the leading global reserve currencies, along with a consequentially-diminished greenback, are no longer far away.

In the final analysis, any military card usually creates more problems than it is designed to solve. With so many problems and challenges remaining on her hands, China would be the last country wanting to start a war, least of all with her neighbors. Jobs and prosperity tend to weigh more heavily than guns and boots in the calculations of most of China's neighbors. There is no prize guessing which country is likely to offer the best opportunity for these in the region.

The body language in the second Yale Global photo is interesting. It remains to be seen which of the two leaders - Abe or Park - gets the big picture.

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