The geoeconomics and geopolitics of China-United States rivalries in the Asia-Pacific vs Indo-Pacific strategies

Abstract

In the first decades of the 21st century, significant changes in global politics and economics are underway, especially the growing participation of the Pacific Rim in global production and its growing productive and regional integration. The Asian economic recovery, in a historical process of convergence resulting from its industrial catching up, and the historical return of its greater participation in the world economy, place the Asian borders of the Pacific as the most dynamic region in economic terms of the 21st century. China, in turn, becomes the main geoeconomic power that emerged from this process, which has important regional consequences in Asian productive integration, in trade flows, in China-United States disputes, as well as geoeconomic and geopolitical instruments with structural changes. The process of productive fragmentation, with the participation of multiple geographically close economies, based on the export of intermediate goods and the re-export of final goods to the United States and among each other, has shaped Asian productive integration and the establishment of current trade agreements in this region. This has resulted in a progressive promotion and consolidation of the regional integration process. The formation of large blocs, as well as the processes of political and economic integration between geographically close countries, are consolidated trends in the international order of the current century. While regional integration is usually the result of decades of gradual establishment, this process in the Pacific has taken a relatively short time. A process initially led by Japan, based mainly on the productive fragmentation and segmentation of its transnational companies, the Asian productive integration was the catalyst for the initial phases of integrating the Asia-Pacific basin. From production bases installed mainly in Southeast Asia and China, integration continued with the participation of the Asian Tigers, and with the rise of China and its domestic market, especially since the 2000s. The institutions of the region that formed a regional integration process began a great consolidation in the 1990s, with the expansion of Asia-Pacific Economic Cooperation (APEC), of the Association of Southeast Asian Nations (ASEAN) itself, and the creation of consultation blocs, such as ASEAN+3 (APT)–along with Japan, South Korea, and China–and the intensification of bilateral trade agreements in the region. ASEAN therefore became the epicenter of this process, along with a rapid economic and diplomatic rapprochement with China, from the 2001 trade agreement and the broad trade partnership established since then, culminating in mutual commercial leadership in foreign trade in the 2010s. In recent decades, this region has become the most dynamic in terms of economic growth worldwide, which has promoted its integrative processes, especially the largest trade agreement in force, as well as the constitution of the Regional Comprehensive Economic Partnership (RCEP). The consolidation of this mega-bloc, having China as its main promoter, leads to the gradual displacement of the United States as the geoeconomic and main center of productive integration in the Pacific, with significant geopolitical consequences. The dynamics of trade center and productive chains transfers in the region, currently in a gradual process of intraregional concentration in Asia-Pacific, and with great relevance for the Chinese role in the formation of new geoeconomic structures, reinforces and consolidates the changes of geopolitical order. The United States-China disputes, over the preponderance of their distinct geopolitical and geoeconomic projects in the Pacific, are based on the different outcomes and strategic interests of their foreign policies. These two great powers dispute privileged insertions and support in the markets and societies of the region, especially between the countries of the Association of Southeast Asian Nations (ASEAN) and other technological powers of the Pacific–mainly Japan, South Korea, and Taiwan. The different accession configurations of economic and political-security agreements such as the RCEP, the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP), the Quadrilateral Security Dialogue (Quad), and the Indo-Pacific Economic Framework (IPEF), align the intensity of clashes in terms of preferences between different geostrategies for the Pacific. These include an Asia-Pacific geostrategy of geoeconomic preponderance and with Chinese cooperation, and a concurrent Indo-Pacific geostrategy of with the assumed leadership of the United States in regional security agreements. This integration model reinforces the mutual importance of the main technological powers in the region, by intensifying intraregional trade, despite obstacles of geopolitical basis in territorial and maritime disputes, and in the attempt to exploit regional rivalries for geopolitical-geostrategic purposes. This situation is present in China-US rivalries for influence in the Asia-Pacific, and in the United States attempt to form an anti-China coalition in the region, despite the limited presentation, so far, of an United States-led economic alternative to Asian development. This reinforces an advantageous Chinese position in establishing the norms of productive and regional integrations. Finally, the RCEP agreement demonstrates Chinese geoeconomic preponderance within ASEAN, which together form the current stage of deepening integration of the Asian Pacific Rim. These disputes over preferences and different associations are progressively configured as mutually exclusive in an action of containment. An example is participation in the Indo-Pacific strategy of the United States, which constitutes an attempt to reject progressive integration in the Asia-Pacific with Chinese prominence; while the reduction of trade barriers in the region is in accordance with the trend of displacement of transactions with other regions for the development of intraregional trade between the members of RCEP and CPTPP. These competitive elements–in production and preferential markets–form different geopolitical alignments, gradually placing China and the United States in opposite positions, with essential differences in geopolitical and geoeconomic strategic terms. Therefore, the central argument of this article proposes that the distinct geostrategies of Beijing and Washington are based, respectively, on the encounters of geoeconomics vs. geopolitics, as well as in the Chinese proposal to deepen regional economic integration and the establishment of multilateral commitments. This is in contrast with the American positions of military containment strategy, based on suspicions of other regional powers along with the rise of China, frequently described as a form of threat. However, security-focused rhetoric was still not enough to significantly modify the progressive integration of the Asia-Pacific.