U.S. ruins APEC Summit

U.S. Busts APEC Summit With Tariff Demands - New York Times Blames China

 

Moon of Alabama,

20 November, 2018

A New York Times report about last weekend's summit in Asia demonstrates how U.S. media misinform their readers about international events.

The recent summit of the Asia-Pacific Economic Cooperation (APEC) in Papua New Guinea failed to come up with a joint statement. Prime Minister Peter O’Neill of Papua New Guinea, who hosted the summit, promised to issue a "chair's statement" instead. None can be found so far on the APEC website. This was the first time since 1989 that no joined 'Leaders' Declaration' was issued.

The reason was a spat between the U.S. and China about a clause the U.S. tried to insert into the joint declaration.

But as the Times tells the story, the failure of the summit was solely China's fault:

At a major international gathering in Papua New Guinea over the weekend, the United States wanted to end with a group statement emphasizing free trade. China objected.

But instead of working out the disagreement through dialogue, Chinese officials barged uninvited into the office of the host country’s foreign minister demanding changes in the official communiqué.
...
“China doesn’t care if it looks like a boor. If you are a tough guy, you don’t care what others think,” said Hugh White, a former military strategist for the Australian government and author of “The China Choice.”

Such behavior was only surprising because it had been more than 30 years since the world had witnessed such edginess, Mr. White said.

The Chinese deny that the APEC incident happened at all. Mr. White seems to have missed the 2009 Copenhagen climate talks during which the U.S. president and his secretary of state boorishly busted a meeting, held by China, Brazil, India and others, they were not invited to join:

Once they found the makeshift conference room where the meeting was being held, Obama, Clinton, and their aides approached a "commotion" as she describes it — foreign aides and security guards outside the door. According to Clinton, White House press secretary Robert Gibbs confronted a Chinese guard. "In the commotion the president slipped through the door and yelled, 'Mr Premier!' really loudly, which got everyone's attention. The Chinese guards put their arms up against the door again, but I ducked under and made it through," Clinton wrote.

Back the NYT's APEC piece:

The American official said the Chinese had taken issue with two portions of the draft communiqué that Washington supported and other members embraced.

One paragraph said the APEC member economies agreed to fight against unfair trade practices. Another paragraph said that members of the group would work together to improve the “negotiating, monitoring and dispute settlement functions” of the World Trade Organization.

The NYT report does not say what the U.S. promoted paragraphs actually said. Nor does it quote any Chinese source. What are "unfair trade agreements"? What WTO changes were asked for? Why are these "improvements". Why is that supposed to be an APEC issue?

The AFP's has a way more informative take of the talks:

"You know the two big giants in the room. What can I say?" said host and Papua New Guinea Prime Minister Peter O'Neill, conceding defeat.
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Sources said going into the meeting the United States had pressed for the leaders to issue what amounted to a denunciation of the World Trade Organization and a call for its wholesale reform. That demand was a step too far for Beijing, which would likely get less preferential treatment under any changes.

...

O'Neill indicated the WTO had been a sticking point in agreeing a joint communique.

"APEC has got no charter over the World Trade Organization. That is a fact," he said. "Those matters can be raised at the World Trade Organization."

The U.S. obviously pressed others to agree to WTO changes.

When China joined the WTO in 2001 its GDP per capita was less than $2,000. It was classified as a "developing country" which gave it some justified privileges. Eighteen years later China's GDP per capita is approaching $8,000. The U.S. GDP per capita is $53,000, while the EU's is about $37,000. China has certainly become more wealthy but it is still not a fully developed country. While the issue is not urgent it will have to be discussed and China is willing to do that.

But the issue that the U.S. pressed for was even more controversial.

AFP continues:

"Business leaders do not want to speak out, but behind the scenes here, they are talking over dinner saying 'how has this happened'?" Denis O'Brien, the billionaire chairman of Digicel told AFP.

"It's a very forced situation, one country is trying to force all the other countries to change tariffs agreed over years," O'Brien said.

What the U.S. actually tries to achieve is not only to break certain privileges China holds.

It wants to justify its punitive tariffs against China and other countries which are illegal under WTO rules. Trump's original plan was going even further. He considered a bill that would allow him to raise tariffs at will without congressional consent:

Nations are prohibited from setting different tariff rates for different countries outside of free trade agreements and the established tariff ceiling that WTO members have agreed to.

"It would be the equivalent of walking away from the WTO and our commitments there without us actually notifying our withdrawal," a source familiar with the bill told the outlet but added that Congress would never agree to the bill, describing it as “insane.”
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Axios had reported that Trump had asked aides about pulling the U.S. out of the WTO, and said the world had used the organization to “screw the United States.”

The NYT is pointing in the wrong direction when it blames China of the failure of the APEC summit. It was the U.S. that tried to abuse the summit's joint statement by inserting clauses that a. to not belong within the frame of APEC and b. are an attempt to subvert internationally agreed trade rules.

It is certainly not only China that rejects the Trump administrations attempts to change the rule book for international trade that all WTO members have agreed to. The chair of the meeting agreed with the Chinese side in this. Any reference of WTO reform with the aim to change tariff rules is not an APEC issue and should have no place in its joint statement. The NYT readers though, will never learn this.

What the NYT defends as "emphasizing free trade" and as a "fight against unfair trade practices" is the exact opposite. The Trump administration tries to change trade rules so they would allow it to introduce tariffs as it wishes. The Trump administration does not want to "improve" the WTO, it wants to abolish it.  Its measures would destroy free trade.

The Trump administration will not be unhappy about the failed APEC summit. It is actively trying to thwart inner-Asian cooperation. It hopes to induce Asian countries to join its anti-China front. The NYT, it seems, is fully supportive of these moves.

U.S.-China Clash at Asian Summit Was Over More Than Words