Obama's Asia focus faces early scrutiny - Truth About Trade and Technology

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Thursday, 20 November 2008 18:05

The Australian
November 20, 2008 SOUTH Korea's President Lee Myung-bak says he doesn't mind if Barack Obama, who will be sworn in as president of the US on January 20, goes to North Korea to meet the hermit kingdom's reclusive dictator, Kim Jong-il. Phew, thinks Obama, that's just what I wanted to do.

Actually, it's not right to be frivolous about this. I am spending a few days in Seoul, South Korea's momentarily freezing capital. And South Korea is obsessed with one very fair question: What does the new US president mean for me?

South Korea's Lee was elected as an overtly pro-American president. He has had a rough first year in office and has seen his popularity fall. But he is still a strong president with more than four years left in office. He got on well with President George W. Bush. Like Bush, he comes from the conservative side of politics. And like most East Asians he is probably modestly more comfortable with a Republican in the White House than a Democrat. Like Australia's Kevin Rudd, Lee has been in Washington to attend the G20 meeting. Also like Rudd, he is heading to Peru for the Asia-Pacific Economic Co-operation summit and has spoken to Obama on the phone to offer congratulations.

One overwhelming impression from being in Korea is that the US-South Korea alliance is robust and likely to be with us for a long time.

The previous president, Roh Moo-hyun, was elected on a moderately anti-American platform. That led to some utterly ridiculous analysis to the effect that the US-South Korea alliance was on its last legs and South Korea would become dominated strategically and economically by China. Instead, the past several years have seen many remarkable advances in the US-South Korea relationship, a relationship that is of the utmost importance to Australia. South Korea sent thousands of troops to help the US in Iraq and Afghanistan. The two nations negotiated a free trade agreement, which is more than Australia has done with South Korea.

Just this week, the US introduced the visa waiver program for South Korea. The US also has undertaken a big base hand-back program to the South Koreans and reduced its troop presence from 37,000 to about 28,000.

The depth and intensity of the US-South Korea relationship tends to be overlooked by outsiders, especially Australians given to fatuously lecturing Americans on Asia. At the 2000 US Census there were something like 1.2million Korean Americans. The Korean student community is the US's biggest foreign student community. And of course the US lost about 37,000 troops in the Korean War a half century ago.

The most important Korean policy question for Obama, of course, is what to do about North Korea's nuclear program. But before confronting that endless task, an Obama administration has to make one or two key decisions regarding South Korea. These decisions are so important to Australia that they should form a substantial part of the dialogue of the Rudd Government with the new administration in Washington. Rudd so far has done well on South Korea, taking the trouble to visit early in his prime ministership.

However, his speeches in his trips to the US have tended to concentrate on US policy towards China. Rudd needs to make an Australian input into US policy towards the northeast Asian triangle of China, Japan and the Korean peninsula. The first order of business for an Obama administration in relation to Korea is how it deals with the US-South Korea free trade agreement. During the presidential primaries, Obama irresponsibly opposed this FTA. This was a naked bid for votes from blue-collar car industry workers in Michigan and, to some extent, Ohio.

Although the FTA has been finalised, neither the South Koreans nor the Americans have yet ratified it. However, in South Korea this would be nearly a formality. In the US, the Democratic congressional leadership has been opposed to it on grounds of pure protectionism.

Both sides nonetheless understand the political realities in the US mean there may need to be some further side statement regarding the car trade, which would supplement the FTA without requiring its total redesign.

The FTA is one of the technically best and most comprehensive the US has negotiated. If, in the light of all the strength and history of this bilateral relationship, the US were to walk away from the FTA, it would have serious consequences for the US-South Korea relationship.

In short, the US needs the FTA for the Korea relationship and to maintain its influence within South Korean society.

This is critically important in itself, given the size of the South Korean economy. But it is also important in the long run in helping South Korea avoid a fate it clearly does not want, namely falling into China's strategic orbit.

The South Korean attitude to Obama - of excitement at the inspiration of the president-elect, plus significant hope for a breakthrough on several policy fronts, mixed with scarcely hidden anxiety about an untried president - reflects the attitude elsewhere in northeast Asia.

The Japanese are anxious because there is no obvious pro-Japan voice in an Obama administration and the focus in Asia policy has been on China. The Chinese traditionally have been more comfortable with Republicans, despite their hardline reputation, than with Democrats. It was Republicans Richard Nixon and Henry Kissinger who opened up to China. George H.W. Bush was US diplomatic head in Beijing before he became president. George W. Bush slapped down any independence sentiments in Taiwan, whereas Bill Clinton gave the Chinese a lot of grief over human rights and trade issues.

For the US, you can't manage one part of northeast Asia well without managing the other parts properly. South Korea has far too low a profile in Australia. It is our third biggest trade partner and a critical component of the regional security equation. It is, like us, a liberal democracy and an ally of the US. So we need good US policy towards South Korea. Getting the US-South Korea FTA passed in Congress is going to be extremely difficult. Whatever small influence Australia can have on US Asian policy should be bent, in part, to that task. Nothing will be a clearer early guide of how effective an Obama administration will be in Asia, on which a great deal of our national interest hangs.