US wants 'rebalancing' in trade ties with Asean, says top Trump trade official

President Donald Trump decided to pull the US out of the Trans Pacific Partnership shortly after taking office, on grounds that its terms did not favour the US.
President Donald Trump decided to pull the US out of the Trans Pacific Partnership shortly after taking office, on grounds that its terms did not favour the US.PHOTO: EPA-EFE

WASHINGTON - A key priority for the United States is "rebalancing" trade relations with Asean countries - but Washington prefers bilateral to collective agreements, said  Ambassador Jeffrey T. Gerrish, Deputy US Trade Representative for Asia, Europe, the Middle East, and Industrial Competitiveness.

In his first public comments since his appointment in March, Mr Gerrish, a former trade attorney, said: "The United States does a lot for Asean in terms of market access. We need Asean to do more for us.

"Whether they relate to agricultural imports in Thailand, or vehicle barriers in Vietnam, localisation requirements in Indonesia, or emerging barriers to electronic payment services in several countries, we will work with our Asean partners to address and resolve these issues successfully and to our mutual benefit."

He was addressing business executives, US and Asean ambassadors and policy specialists at the US-Asean Business Council's annual gala dinner in Washington on Thursday.

The US has significant trade deficits with many Asean members, and a US$92 billion goods trade deficit with Asean countries collectively, Mr Gerrish noted.

"Last year alone with the individual members of Asean we had large goods trade deficits - US$38 billion with Vietnam, US$25 billion with Malaysia, US$20 billion with Thailand, and US$13 billion with Indonesia," he said. He did not mention Singapore. The US enjoys a trade surplus with Singapore.

The US wanted to address the trade imbalances, Mr Gerrish said, adding that "multilateral and multi-country agreements limit the depth of commitments that participating countries make and do not allow agreements to be properly shaped to fit the particular circumstances of the countries involved."

Mr Gerrish said that the relationship with Asean was seen as very important at the highest levels of the Trump administration while noting that collectively the regional bloc formed was the fourth largest trading partner for the US.

Two-way trade between the US and Asean reached US$230 billion in 2016, growing by more than 58 per cent since 2010.

"Our agenda is driven by pragmatic determination to use the leverage available to the world's largest economy, to open markets, (and) attain more efficient global markets (for) fairer trade for American businesses and workers," Mr Gerrish said.

"One way we are seeking to achieve these results is by holding our trading partners accountable for their commitments and enforcing US trade laws."

He cited the Trump Administration's use of a Section 301 investigation to determine actions against China on grounds of its forced technology transfers and intellectual property policies, as an example.

The US was also pursuing institutional reforms to "make the World Trade Organisation (WTO) better," he said. The Trump administration believes the WTO has not worked in favour of the United States.

"By taking these and other actions we are seeking to enjoy the proper and efficient operation of the global trading system and to restore faith that it can work for all," Mr Gerrish said.

"We are also seeking to strengthen and improve our trade relationships around the world," he insisted. "Nowhere is this more true than in the Indo Pacific region."

At the same event Texas Democrat Congressman, Joaquin Castro, who is co-founder of the Asean Caucus in Congress, said: "My concern is that the administration has not clearly defined the role of Asean within the Indo-Pacific geography in its formulation of policy."

"For years the United States and our partners in the region have sought to place Asean in the centre of an institutional system in Asia," he said.

"The Asean regional forum, East Asia summit, and other efforts at providing the region an overarching political and economic architecture had Asean participation at its core. Apec, and the TPP, relied heavily on the participation of Asean nations."

Apec is the Asia Pacific Economic Cooperation forum. The TPP is the Trans Pacific Partnership, originally a 12-nation trade agreement until President Donald Trump decided to pull the US out of the deal shortly after taking office, on grounds that its terms did not favour the US. Subsequently, the TPP became the 11-nation Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), minus the US.

"I believe we must emphasise and elevate Asean's role in regional efforts to build a rule based framework for international cooperation in the region," Mr Castro said.

"The President withdrew from the TPP but he hasn't yet presented a credible alternative that addressses many of the valid concerns America had with the original agreement."