Friday, April 25, 2014

President Obama Spring Tour of Asia ( April 22 - 29 , 2014 ) Japan , South Korea , Malaysia and Philippines starts with a photo op full trip to Japan ( failure to reach regional trade deal with Japan underlines inability to get things done though ) ..... Meanwhile China quietly benefits !

US 'pivots', China reaps dividends
By Pepe Escobar

Let's start with a flashback to February 1992 - only two months after the dissolution of the Soviet Union. First draft of the US government's Defense Planning Guidance. It was later toned down, but it still formed the basis for the exceptionalist dementia incarnated by the Project for the New American Century; and also reappeared in full glory in Dr Zbig "Let's Rule Eurasia" Brzezinski's 1997 magnum opus The Grand Chessboard.

It's all there, raw, rough and ready:

Our first objective is to prevent the reemergence of a new rival, either on the territory of the former Soviet Union or elsewhere, that poses a threat on
the order of that posed by the Soviet Union. This ... requires that we endeavor to prevent any hostile power from dominating a region whose resources would, under consolidated control, be sufficient to generate global power. These regions include Western Europe, East Asia, the territory of the former Soviet Union, and Southwest Asia.
That's all one needs to know about the Obama administration's "pivoting to Asia", as well as the pivoting to Iran ("if we're not going to war", as US Secretary of State John Kerry let it slip) and the pivoting to Cold War 2.0, as in using Ukraine as a "new Vietnam" remix next door to Russia. And that's also the crucial context for Obama's Pax Americana Spring collection currently unrolling in selected Asian catwalks (Japan, South Korea, Malaysia and Philippines).

Obama's Asia tour started this week in full regalia at the famed Jiro restaurant in Ginza, Tokyo, ingesting hopefully non-Fukushima radiated nigiri sushi (disclosure: I was there way back in 1998, when sushi master Jiro Ono was far from a celebrity and the sushi was far from atomic). Obama's host, hardcore nationalist/militarist Prime Minister Shinzo Abe, obviously picked up the bill. But the real bill comes later, as in Japan bowing to strict US demands - on trade, investment, corporate law and intellectual property rights - embedded in the 12-nation Trans-Pacific Partnership (TPP), which is code for American Big Business finally cracking open the heavily protected Japanese market.

Abe is a tough customer. His rhetoric is heavy on "escaping the post-war regime", as in re-weaponizing Japan and not playing second fiddle militarily to Washington in Asia anymore. The Pentagon obviously has other ideas. Post-sushi at Jiro, what matters for Obama is to force Tokyo to bend over not only on TPP but also on keeping the weaponizing subordinated to the larger US agenda. Beijing, predictably, sees all that for what it really is, as expressed in this Xinhua op-ed; the actions of an "anachronistic", "sclerotic" and "myopic" superpower that needs to "shake off its historical and philosophical shackles". 

The Southeast Asia leg of the Spring collection tour is all about making sure to Malaysia and Philippines, not as strong militarily as Vietnam, that the US Navy will never be replaced as the hegemon in the South China Sea - or even allow China to reach parity with it. It's at the heart of the "pivoting to Asia" as containment of China, whose aim is preventing China from becoming a naval power simultaneously in the Indian Ocean and the Western Pacific.

The Pentagon is predictably paranoid, accusing China of waging not only one but "three warfares" against the US. The fact is Beijing is developing a state-of-the-art underground base for 20 nuclear submarines in Hainan island just as Malaysia boosts its own submarine base in Borneo and the Philippines keeps imploring Washington for more planes, ships, airstrips and cyber capabilities as protection for what it regards as its absolute priority: explore for oil and gas in the West Philippine Sea to boost the economy.

Radiate me with trade deals, baby
The Spring collection is far from derailing other pivoting - whose latest offering is the current "anti-terrorist" campaign in eastern Ukraine by the Kiev regime changers, which follows a most curious calendar. CIA's John Brennan hits Kiev, and the regime changers launch their first war on terra. Dismal failure ensues. Vice President Joe Biden visits Kiev and the regime changers, right on cue, relaunch their war on terra.

Thus the pivoting to Cold War 2.0 proceeds unabated, as in Washington working hard to build an iron curtain between Berlin and Moscow - preventing further trade integration across Eurasia - via instigation of a civil war in Ukraine. German Chancellor Angela Merkel remains on the spot: it's either Atlantic high-fidelity or her Ostpolitik - and that's exactly where Washington wants her.

As for the batshit crazy factions fully deployed across the Beltway revolving door, everything goes, from "warning" China not to pull a Crimea to advocating war in Syria and even the North Atlantic Treaty Organization entering a nuclear war, as shown here by the appropriately denominated Anne Marie Slaughter. This is what she's teaching her exceptionalist students at Princeton. How's Beijing reacting to all this hysteria? Simple: by reaping dividends. Beijing wins with the US offensive trying to alienate Moscow from Western markets by getting a better pricing deal on the supply of Eastern Siberian gas. Beijing wins from the European Union's fear of losing trade with Russia by negotiating a free-trade agreement with its largest trading partner, which happens to the be the EU.

And then, the sterling example. Just compare Obama's Spring collection tour, as a pivoting appendix, to the current tour of Cuba, Venezuela, Brazil and Argentina by Chinese Foreign Minister Wang Yi. It's a business bonanza, focused on bilateral financing and, what else, trade deals.

It's all in the mix: Peruvian and Chilean copper; Brazilian iron and soybeans; support for Venezuelan social programs and energy development; support for Cuba in its interest for greater Chinese involvement in Venezuela, which supplies Cuba with subsidized energy.

And all this against the background of a Beltway so excited that the Chinese economy is in deep trouble. It's not - it grew at 7.4% year-on-year for the first quarter of 2014. Demand for iron and copper won't significantly slow down - as the Beijing-driven urbanization drive has not even reached full speed. Same for soybeans - as millions of Chinese increasingly start eating meat on a regular basis (soybean products are a crucial feedstock). And, of course, Chinese companies will not losee their appetite for diversifying all across South America.

For the large, upcoming Chinese middle class - on their way to becoming full-fledged members of the number one economic power in the world by 2018 - this Spring collection is a non-starter. He or she would rather hit Hong Kong and queue up in Canton Road to buy loads of Hermes and Prada - and then strategically celebrate with Jiro quality, non-Fukushima-radiated, sushi.

(Reuters) - U.S. President Barack Obama wrapped up a state visit to Japan on Friday during which he assured America's ally that Washington would come to its defense, but failed to clinch a trade deal key to both his "pivot" to Asia and Prime Minister Shinzo Abe's economic reforms.
Obama and Prime Minister Shinzo Abe had been seeking to display the alliance was strong in the face of a rising China, but their success in putting recent strains behind them was partly marred by a failure to reach a deal seen as crucial to a broader regional trade pact.
That failure delayed a joint statement on security and economic ties until shortly before the U.S. leader left for Seoul, the next stop on his week-long, four-nation Asian tour.
Obama and Abe had ordered their top aides to make a final push to reach a trade agreement after the leaders met on Thursday, but Economy Minister Akira Amari told reporters that gaps remained despite recent progress.
"This time we can't say there's a basic agreement," Amari told reporters after a second day of almost around-the-clock talks failed to settle differences over farm products and cars. "Overall, the gaps are steadily narrowing."
Seeking to put a positive spin on the trade front, the two sides said in their statement that they were committed to taking "bold steps" to reach a two-way deal, which would inject momentum into a delayed 12-nation Trans-Pacific Partnership (TPP) trade pact.
A senior U.S. trade official said the two sides had achieved a breakthrough on market access, but provided few details.
"There are still details to be worked out. There is still much work to be done ... We believe we do have a breakthrough in our bilateral negotiations," said the senior official accompanying Obama to South Korea.
The TPP is high on Abe's economic reform agenda and central to Obama's policy of expanding the U.S. presence in Asia.
Obama on Thursday assured Japan that Washington was committed to coming to its defense, including of tiny isles at the heart of a row with China, but denied he had drawn any new "red line" and urged peaceful dialogue over the dispute.
Friday's joint statement echoed those comments and put in writing a long-held U.S. stance that the uninhabited islands in the East China Sea are covered by a security treaty that obliges Washington to defend Japan.
Those comments drew a swift rebuke from Beijing, which also claims sovereignty over the Japanese-controlled islands, known as the Senkaku in Japan and the Diaoyu in China. Japanese and Chinese patrol ships have been playing cat-and-mouse near the isles, and Washington is wary of being drawn into any clash.
Chinese Foreign Ministry spokesman Qin Gang said China had "serious concerns" about some of the contents of the joint statement.
"We urge the United States and Japan to abandon their Cold War mentality, and respect the concerns and interests of other countries in the region, and avoid further interference with regional peace and stability," he told a daily news briefing.
The allies also said they wanted to build productive ties with China but expressed concern about its Air Defense Identification Zone covering the disputed isles, announced last year, as well as activities fanning tensions in the South China Sea, where other Asian countries have rows with Beijing.
"Our two countries oppose any attempt to assert territorial or maritime claims through the use of intimidation, coercion or force," the statement said.
The diplomatic challenge for Obama during his week-long, regional tour is to convince Asian partners that Washington is serious about its promised strategic pivot, without harming U.S. ties with China, the world's second-biggest economy. Beijing has painted the "pivot" as effort to contain the rising Asian power.
Abe, who returned to office in 2012 pledging to boost Japan's security stance and tighten ties with the United States, hailed the joint statement as "historic" and said a "key milestone" had been reached in the trade talks.
A Japanese government official, however, told Reuters that the trade stalemate had delayed issuance of the broader statement until just before Obama's departure.
"They (the U.S. side) wanted to delay the statement until we finished TPP," a Japanese official said.
"Of course, TPP was not finished. It is still ongoing." But he added that there were some "meaningful discussions".
The senior U.S. official accompanying Obama said the two sides had "identified a pathway to market access" in the politically tricky agriculture and autos sectors.
Obama's three-day stay in Tokyo - the first full state visit by a U.S. president since 1996 - was meant to show that the U.S.-Japan alliance, the main pillar of America's security strategy in Asia, is solid at a time of rising tensions over growing Chinese assertiveness and North Korean nuclear threats.
But the trade squabbling risked leaving something of a bitter taste, despite the pomp and circumstance of a stay that included a formal dinner hosted by the emperor and a casual meal with Abe at an upscale sushi restaurant.
Asked about the summit, Finance Minister Taro Aso told a news conference that Obama did not have the clout to get consensus in the United States and that a deal was unlikely at least until after the U.S. mid-term Congressional elections in November.