By Sandy K. Johnson
The American vision of trade relations with the Asia Pacific region has remained consistent for decades, if not centuries, according to Kurt W. Tong, U.S. consul general for Hong Kong and Macau: “One of open doors and open markets.”
What has changed in recent years are America’s leading trade partners. In the 1970s, Japan was the dominant player in Asia trade with the U.S. with a 52% share; China was negligible. By 2010, China had powered to a 42% share; Japan had fallen to 16.5%. That shift helped lead to the current trade struggle between the U.S. and China.
Another difference is the negotiating strategy of President Donald Trump.
Tong takes a long view. He’s been in the diplomatic corps since 1970 and has been chief of mission in Hong Kong since August 2016. He said Trump’s goal is to try to get a better deal for the U.S. “Look at the strategy rather than the tactics. The tweets are a tactic, not the strategy,” Tong said. “Trump is a results-oriented negotiator who’s willing to use leverage” to achieve results.
Tong noted that it’s not just China; Trump has used the same strategy with Canada, Mexico, Japan, Europe and others, with differing results. “The fundamental objective is quite transparent to everyone, and so my hope is that we get some deals,” he said.
For reporters, Tong suggested the most important economic indicator is foreign direct investment because, he said, it reflects investors who have a direct stake in the transaction. The current value of U.S. foreign direct investment in the Indo-Pacific region is $1 trillion, and roughly the same amount of money flows into the U.S. from the region.