The Asia-Pacific
Economic Cooperation (APEC) meetings continue today in Beijing, so the story
isn't over yet, but it's increasingly looking like China is winning big at APEC
at America's expense. Put another way: if APEC were last night's Monday Night
Football game, China would be the Eagles and America the Panthers.
Let's review the
highlights:
China
and Russia expand their partnership: Gazprom,
Russia's state-owned oil company, inked its second major gas deal with China
this year. Separately, Russia's state run bank Sberbank secured about $2
billion in financing from Chinese lenders, which will help ease the pain of
Western sanctions against Vladimir Putin's regime. The deals give Russia
additional leverage with Europe, which is highly dependent on Russia's natural
gas and helps China secure a major source of energy on favorable terms.
President Obama's rhetoric about 'pivoting' toward China and the obvious
tension between the U.S. and Putin's regime have helped push the Chinese and
Russians closer in a classic "the enemy of my enemy is my friend"
situation.
Asia
embraces China: "Leaders of Asia-Pacific economies agreed
Tuesday to begin work toward possible adoption of a Chinese-backed free-trade
pact, giving Beijing a victory in its push for a bigger role in managing global
commerce," The AP reports. This is a victory for China and blow to the
U.S.-led Trans-Pacific Partnership, which excludes China.
Tear
down these walls: The U.S. and China agreed to drop tariffs on
about 200 different technologies, including semiconductor, medical tech
equipment and GPS devices. South Korea inked a similar deal to remove tariffs
on 90% of goods and Australia is expected to announce a similar agreement.
Experts believe these deals could be a prelude to a major tariff-cutting
agreement at the World Trade Organization meeting in Geneva next month. (This
is arguably a "win" for the U.S. too; and Carolina scored 21 points
vs. the Eagles.)
State-sponsored
capitalism: On the eve of the APEC summit, China announced the
long-awaited Shanghai-Hong Kong Stock Connect, which will allow foreign
investors far greater access to Chinese companies listed in Shanghai. Separately,
China's central bank engineered the biggest one-day rally in the renminbi in
four years, effectively throwing a bone to its trade partners.
Oh, and China is
exhibiting its new stealth fighter at the Airshow China, which kicked off
Tuesday in Zhuhai.
In sum, while
America has talked about containing China's ambitions, enemies like Russia and
regional allies alike -- including Japan -- are moving toward closer ties with
the Middle Kingdom. This may be just a reflection of China's "home court
advantage" at APEC and the undeniable reality of its place in the global
economy and dominance in the region. As discussed in the accompanying video,
China is also taking advantage of President Obama's weakened state in the wake
of the drubbing his party suffered in last week's midterms. For all the talk
about domestic U.S. politics, the impact of President Obama's falling political
stature is very much a global story and one with potentially negative
implications for Americans, regardless of political affiliation.
Aaron Task is Editor-in-Chief of
Yahoo Finance. You can follow him on Twitter at @aarontask or email him at altask@yahoo.com.
No comments:
Post a Comment