APEC, President Trump’s Worldview and the US-Vietnam Relationship

Key policymakers from 21 Pacific Rim economies will soon gather in Da Nang, Vietnam for the Asia Pacific Economic Conference (APEC) summit, and a lot of national media attention has focused on the city’s preparations. With Donald Trump, Xi Jinping, Abe Shinzo and Vladimir Putin in attendance along with other key leaders, the global media spotlight will shine brightly upon Da Nang as well.

However, the ceremony and spectacle of having so many of the world’s most powerful people in one place (APEC members account for around 60% of global GDP) can sometimes distract from questions about the summit itself. What is the purpose of APEC? How is it relevant to world affairs? How will the outcome of the summit impact Vietnam’s relations with the rest of the region and world?

APEC was established more than two decades ago to promote region-wide economic cooperation. However, APEC’s support for free trade has been limited to vague and symbolic mission statements (“leader’s declarations”).

In reality, APEC’s broad and highly diverse membership makes it exceedingly difficult to negotiate a free trade agreement (FTA) for the whole bloc. As a result, the task of trade liberalization has been taken up in bilateral relationships or by smaller groupings that have overlapping membership with APEC, such as the ASEAN Economic Community (AEC), Trans-Pacific Partnership (TPP) and Regional Comprehensive Economic Partnership (RCEP).

With no complicated and legally binding agreement to negotiate and oversee, APEC’s action plans have focused on more modest (but still important) trade facilitation initiatives, including customs harmonization and attempts to reduce cross-border business costs. The most noteworthy of these efforts has been the creation of the APEC Business Card, which allows for visa-free business travel within the bloc.

In general, however, the impact of APEC does not come from its concrete action plans. Its main significance is twofold: (1) it provides a forum for world leaders to present their “big picture” strategic vision for the region and (2) it provides an opportunity for bilateral meetings between different world leaders attending the summit.

With US President Donald Trump making his first visit to Asia, we can expect that his strategic approach to the Asia-Pacific region will be different from his predecessor’s.

The Obama administration spoke of a “pivot to Asia” (i.e. more focus on the Pacific Rim and less on the Middle East). It also sought to promote “liberal international norms” as well as multilateral institutions and initiatives like the Trans-Pacific Partnership (TPP).

While Trump is unlikely to downplay Asia’s importance, his worldview is shaped by more traditional concepts of national sovereignty and interests. He has also stated a preference for bilateral dealings over a multilateral and institution-based approach. These sentiments will probably be invoked by Trump at the upcoming APEC summit.

For some countries in the region, Trump’s emphasis on national sovereignty and interests could induce a shift in their relations with the US. For example, he has openly suggested that Tokyo should be due more to provide for its defence, which indicates he has somewhat mixed feelings about the current configuration of the US-Japan security relationship. In stark contrast, America’s relations with Thailand and the Philippines have improved markedly over the past year, in part because President Trump has refrained from criticizing their internal politics (unlike the Obama administration).

Although the US President’s decision to pull out of the multilateral TPP deal was a disappointment for Hanoi, the growth of US-Vietnam trade, investment and people to people contacts (via business, tourism and study abroad) will continue to intensify in the years ahead. Recent efforts to improve ties between the two militaries also commands support within the US military establishment and seems likely to progress. A renewed emphasis sovereignty and practical deal-making could provide an important ingredient in making the relationship more stable and sustainable as well. On balance, Trump’s worldview will be probably a positive factor for the continued development of the US-Vietnam comprehensive partnership in the years ahead.

*The author is Business Development Manager at Global Integration Business Consultants in Ho Chi Minh City, earned M.A. degree from the Elliot School of International Affairs at George Washington University.