President Obama’s Asian Agenda

A year after U.S. President Barack Obama’s first trip to Asia to strengthen cooperation with a growing center of global power, he’s set to leave on another trip to the region from November 6-14, with stops in India, Indonesia, South Korea, and Japan.

What should Obama focus on in his visit? CFR Adjunct Senior Fellow Evan Feigenbaum says areas of notable progress in India are likely to include cooperation on defense, trade, nuclear issues, education, and export controls. In Indonesia, CFR Southeast Asia Fellow Joshua Kurlantzick writes the president should urge the Indonesian government to make progress on reforming the military, fighting corruption, and rebuilding the country’s infrastructure. While in Seoul for the G20 summit, CFR’s Edward Alden says Obama should express his commitment to free trade and ratify a pending free trade agreement with South Korea ahead of the trip. On the sidelines of the summit, says CFR Korea expert Scott Snyder, Obama must address a growing gap between U.S. and Chinese approaches to regional security issues like North Korea. In Japan, where he will attend the Asia Pacific Economic Cooperation meeting, Obama’s visit will be "a make or break moment" for the U.S.-Japan alliance, says CFR expert Sheila Smith, given the recent tensions arising from a historic political transition in Tokyo and disagreements over the relocation of a U.S. Marine base in Okinawa.

Evan A. Feigenbaum

Obama has faced four basic challenges in New Delhi:

First, there were his early missteps. As a presidential candidate, he told TIME’s Joe Klein that he would appoint a U.S. envoy to seek peace in Kashmir. But this kind of third-party intervention in India’s dispute over Kashmir with Pakistan is deeply anathema to most Indians. Thus mistrust spiked, then lingered, after Obama’s inauguration.

Second, the two sides have lacked a new "big idea" to succeed the civil nuclear deal. That effort sought to overcome a bilateral dispute left over from the 1970s, but quickly became a full-fledged campaign to achieve a unique international status for India.

Third, many other ideas and initiatives bogged down--from a bilateral investment treaty to a commercial space launch agreement.

Still, the most important problem has been substantive: Disagreements over Obama’s policies toward Afghanistan and Pakistan have been a principal obstacle to strengthened U.S.-India relations. Many in the Indian government are deeply skeptical of the Obama administration’s approach, which they view as enabling Pakistan’s efforts to extend its influence in Afghanistan as U.S. troops withdraw. And if the Indian government has been skeptical, then commentators, pundits, and former Indian officials have been downright frigid.

Obama hasn’t overcome this fourth problem, but enhanced intelligence and counterterrorism cooperation has gone some way toward mitigating its impact. Indeed, it has been a major growth area during his administration, building opportunities in the wake of the November 2008 Mumbai attacks.

But U.S.-India relations have become more global. The visit will lead to more cooperation in Afghanistan, Asia, and Africa. Other areas where notable progress is likely include:

• Export controls: Most technology flows freely, but governmental and corporate India chafe under remaining U.S. restrictions (for instance in the civil nuclear and space industries), complaining that these treat India as a pariah, not a partner. Obama’s visit should produce some major changes to U.S. licensing procedures.
• Defense: India won’t sign long-stalled logistics and communications agreements, but announcement of Boeing C-17 sales is likely.
• Trade: Despite U.S. pressure, India won’t likely raise its foreign investment cap in areas like insurance anytime soon. But the visit may help launch a Bilateral Investment Treaty. And an accompanying delegation of CEOs will facilitate deals at a time when India is weighing regulatory changes in such closed sectors as multibrand retail.
• Nuclear: Recent Indian liability legislation continues to threaten the nuclear deal by exposing U.S. companies to possible lawsuits. But India just signed an important international liability convention, as the United States has long sought, although additional steps remain there too.
• Education: The visit will ultimately help open India to foreign investment in higher education; many U.S. varsities seek to open campuses in India.

Joshua Kurlantzick, Senior Fellow for Southeast Asia, Council on Foreign Relations

Though President Obama twice before canceled trips to Indonesia, his boyhood home, he still enjoys enough goodwill in the country that he should be able to make real progress in creating a far closer partnership between the two countries. Unfortunately, his potential partner, Indonesian President Susilo Bambang Yudhoyono, has squandered much of his own domestic goodwill by moving far too slowly on critical initiatives like fighting corruption; street protests erupted in Jakarta in late October, with demonstrators blasting Yudhoyono’s performance in his second term as president.

For Obama, then, the challenge in Jakarta will be to highlight Yudhoyono’s strengths and victories while acknowledging Yudhoyono’s challenges, and subtly prompting the Indonesian government to move more forcefully on issues that matter to Washington, including reforming the military, fighting corruption, rebuilding the country’s infrastructure, and streamlining the environment for foreign investment.

The White House already has taken a major step by restoring military relations with Indonesia, including with the Indonesian Special Forces, which has a terrible human rights record. During his visit, Obama should publicly make clear that this renewed military relationship does not mean the United States now will turn a blind eye to potential abuses by the Indonesian military, and will continue strong support for the Indonesian police, who thus far have spearheaded a highly successful counterterrorism effort.

Obama should highlight why, despite goodwill in the United States and a vibrant democracy, Indonesia still remains off of many American investors’ radar. For many investors, the lack of coordination among Indonesian ministries make an initial foray into the country a bureaucratic nightmare, while the poor quality of roads, air transport, ports, oil and gas facilities, and other infrastructure raises costs over competitors like China.

While Indonesia’s democracy has opened up political space, it probably has made graft worse, since it has in a way decentralized corruption, making it easier for a wider range of local officials to take money from projects. In addressing corruption, Obama should rightly praise Yudhoyono for taking several high-profile steps, including initially allowing the national anti-corruption commission to take down several prominent figures. But he should quietly remind Yudhoyono that the anti-corruption fight has stalled badly and that without his leadership, the most retrograde elements of Indonesia’s political and business communities will triumph--and foreign investment will be even less likely.

At the same time, Obama should be careful not to aggressively highlight Indonesia as a model Muslim democracy. Some in the administration see Indonesia this way, and indeed the country has made major strides since the chaos of the post-Suharto era in the late 1990s. But Indonesia has more than one officially recognized religion, and many Indonesian opinion leaders chafe at the idea that they are a "Muslim democracy." What’s more, since Indonesia is far from the currents of Islamic discourse in the Middle East, it has little impact on the Arab world anyway.

Scott A. Snyder, Senior Fellow for Korea Studies and Director of the Program on U.S.-Korea Policy, Council on Foreign Relations

The North Korea issue will dominate bilateral consultations on the sidelines of the G20 summit. The North Korean denuclearization process remains stalemated following the sinking of the South Korean warship Cheonan last spring. In his bilateral meetings with Northeast Asian leaders, President Obama must reaffirm a common approach with South Korean and Japanese allies and address a growing gap between U.S. and Chinese approaches to regional security issues, including both North Korea and recent Sino-Japanese tensions in the East China Sea.

Inter-Korean tensions have eased in recent months as the North has sought to restore economic inflows from the South by renewing appeals for humanitarian aid and holding the first inter-Korean family reunions since the inauguration of President Lee Myung-bak’s administration. But North Korea has not heeded Lee’s call for it to admit responsibility for sinking the Cheonan and to punish those responsible, even though it has reaffirmed its willingness to return to the Six Party Talks, the resumption of which China has also promoted. Presidents Obama and Lee will maintain unity by insisting that the North take actions to improve inter-Korean relations and show its commitment to denuclearization as a precondition for returning to the talks.

As Obama develops his relationship with Japan’s Prime Minister Naoto Kan, he should stress publicly that U.S. bases in Japan make U.S. security commitments credible in the context of rising regional tensions with China and North Korea.

Following his bilateral meeting with Chinese President Hu Jintao on the sidelines of the Toronto G20 summit last June, Obama characterized China’s approach toward North Korea as "willful blindness." Since then, Sino-DPRK relations have grown even closer. In August, an ailing Kim Jong-Il made his second visit to China this year to meet with Hu in advance of North Korea’s party conference, and he personally hosted senior Chinese party and military representatives in October for two major anniversary celebrations.

Although Hu emphasized the need for North Korean economic reforms, there has not yet been any public indication that these interactions will restrain North Korean provocative behavior or pressure North Korea to denuclearize. President Obama should encourage China to use its leverage with North Korea, which has been enhanced by U.S. and South Korean implementation of economic sanctions, to insist on North Korea’s return to the path of denuclearization. The North Korea issue remains a critical test of the future ability of the two countries to cooperate on Asian security issues.

Edward Alden, Bernard L. Schwartz Senior Fellow, Council on Foreign Relations

President Obama will arrive for the G20 summit in Seoul as the leader of a weakened political party, grappling with a ballooning budget deficit and presiding over a sclerotic American economy. And, astonishingly, no other leader at the meeting will find himself in a stronger position.

The summit will show that the world’s leading economies still see the United States as crucial to solving their own economic and political challenges. Obama should seize that opportunity.

Treasury Secretary Timothy Geithner’s proposals (FT) for addressing global imbalances, for instance, are enjoying surprisingly strong support. While the compromise by G20 finance ministers in October fell short of U.S. hopes for agreed numerical targets, it was a significant political commitment by both surplus and deficit countries to move toward greater balance and avoid competitive currency devaluations. The president should get other leaders on record supporting those commitments, which could help take pressure off some smaller economies like Brazil and South Africa that have seen sharp rises in their currencies.

Surplus countries like Germany and Japan don’t much like Geithner’s approach. But Japan at least has other reasons to cozy up to the United States following China’s aggressiveness in the recent confrontation over the disputed Senkaku/Diaoyu islands and Beijing’s ham-handed decision to cut off exports of critical rare earth materials. The government of Prime Minister Naoto Kan is now considering seriously a bid to join the U.S.-led trade talks for a trans-Pacific partnership. President Obama should signal openness to the idea.

China would seem the country least likely to be cooperative in Seoul. The U.S. Congress has threatened trade action over currency, and the U.S. Trade Representative’s office is investigating allegations of unfair Chinese trade practices in the clean energy sector.

But instead China looks surprisingly conciliatory. The government is allowing a slow appreciation of the yuan; China has resumed shipments of rare earth materials; and Beijing will want to ensure relations with the United States are smooth leading up to Hu Jintao’s visit to Washington in January. Obama should use his separate meeting with Hu in Seoul to push for continued Chinese movement toward a stronger currency and more domestically driven economic growth.

Obama’s best chance to send a strong signal, however, will be with the host country, South Korea, which like Japan wants the United States to be a counterweight to China’s growing economic and political muscle in Asia. The South Koreans have been waiting more than three years for the U.S. Congress to ratify a free trade agreement. The two sides are now discussing changes to the deal aimed at assuaging Congress, and Obama has said he wants the pact finalized before the Seoul summit. He should direct his trade negotiators to get the job done on time and send a signal to the whole Asian region that the United States is ready to engage again on trade.

Sheila A. Smith, Senior Fellow for Japan Studies, Council on Foreign Relations

President Obama will visit Yokohama to attend the Asia Pacific Economic Cooperation summit. Coming on the heels of the G20 in Seoul, this year’s APEC agenda has been overshadowed by the contention over currency and other issues with China. Trade remains a high priority in the region, but the APEC meeting has less glamour than in the past.

Still, the real challenge for the Obama administration will be how to showcase the relationship that needs the most presidential face time--the U.S.-Japan alliance. It is no secret that the past year has been a bumpy one for Tokyo and Washington, and the primary agenda now is to get this key Asian partnership back on track.

Japan’s unprecedented political transition has been difficult to navigate--both for Japan’s newly elected ruling party Democratic Party of Japan (DPJ)--and for the alliance policy team here in Washington. Regular consultative mechanisms for the alliance were disrupted as the new party in power began to assert more decision-making control and to change the role in the policymaking process for Japan’s powerful bureaucrats.

Prime Minister Naoto Kan and his foreign policy team today can claim a stronger mandate for improving the relationship with Washington. Kan has met the president twice already, and the new foreign minister has worked closely with Washington on difficult security consultations over the recent clash between a Chinese fishing trawler and the Japanese Coast Guard.

The Japan stop on the president’s agenda is going to be a make-or-break moment for the alliance. The U.S.-Japan relationship must pick up momentum if it is to meet the challenges now facing Northeast Asia. A gubernatorial election in Okinawa at the end of November is widely seen as a referendum on the as-yet-unresolved problem of relocating the U.S. Marine base. Despite its commitment to the May 28 agreement to build a new runway in Okinawa, the Kan Cabinet will be hard-pressed to find the fiscal and political resources needed to persuade Okinawans to accept it.

But more promising terrain is available. Increased Japanese interest in the president’s idea of a trans-Pacific partnership could produce a serious effort to study this opportunity to increase trade. Since Honolulu will host next year’s APEC meeting, the APEC venue reminds both leaders of this long-ignored economic dimension to the U.S.-Japan partnership. Likewise, we are also likely to see the beginnings of a U.S.-Japan effort to craft a "Green Alliance," beginning with the U.S. military’s improvements in shared environmental stewardship on bases within Japan, but really a reflection of broader aspirations for energy and environmental cooperation.

Japanese citizens are more worried today about contending with nuclear proliferation in the Korean peninsula and the intentions of a rising China that seems uninterested in problem-solving with its neighbors. Like Americans, they are worried, too, about their economic future.

Not only Japanese, but others in the region, will be watching closely to see if President Obama continues to define Tokyo as a preferred U.S. partner in the Pacific.