APEC Summit: ‘Face the Reality’—the Global Center of Gravity Has Fully Shifted to China and Russia

The 21-nation APEC Summit, being held in Lima, Peru on Nov. 19-20, is turning into the official international burial of Obama’s hated Trans-Pacific Partnership (TPP), which was also handed a death sentence inside the U.S. with the election of Donald Trump. In its stead, China’s Free Trade Area of the Asia-Pacific (FTAAP), which China first proposed at the 2014 APEC Summit in Beijing, is likely to be approved at this APEC summit, as a new institution to help bring about a global change in economic paradigm.

Both Chinese and Russian officials have made it quite clear that the FTAAP is not meant to exclude the United States, or anyone else. Obama’s TPP, on the other hand, emphatically excluded China, which Xi Jinping blasted in a speech he delivered Nov. 18 to APEC business leaders: “We need a framework of regional cooperation of equality, joint participation and shared benefits. Arrangements that are closed and exclusive are not the correct option.”

In his keynote address to the APEC CEO Summit on Nov. 19, Xi stated that the FTAAP “is a strategic initiative critical for the long-term prosperity of the Asia-Pacific.” He emphasized that it was directly associated with China’s Belt and Road Initiative:

“Three years ago, I put forward the Belt and Road initiative. It aims to strengthen connectivity to facilitate free flow of factors of production and create a platform of win-win cooperation and shared benefits for all. Over 100 countries and international organizations have joined or expressed support for the initiative, forming a strong circle of friends brought together by the common vision, mutual trust and friendship. The Asian Infrastructure Investment Bank (AIIB) is up and running. The Silk Road Fund is in place. A number of major projects have been launched, generating huge economic and social benefit.”

Xi also stressed the crucial role of science and innovation in solving the global economic crisis, as he had done at the G20 summit earlier this year:

“Second, we will promote innovation-driven development and replace old growth drivers with new ones. We will continue to pursue the strategy of innovation-driven development and deepen R&D structural reform to change outdated mindset and remove institutional obstacles, fully leverage the role of science and technology in economic and social development, and tap into all sources of innovation. We will further pool the efforts of businesses, universities and research institutes to energize business organizations, people, the market and capital to drive innovation-based development. We will encourage new technologies, new industries and new businesses so that progress in innovation will be applied in economic operations and turned into new forces driving growth. Third, we will promote high-standard, two-way opening-up to deliver win-win outcomes.”

It is noteworthy that, over recent years, Xi has used the annual APEC summits to launch major global initiatives. In 2014 in Beijing, where he first proposed the FTAAP, he also announced the New Silk Road initiative and urged the U.S. and other nations to join in. He did so at a joint press conference with a hapless US President Barack Obama at his side; Xi’s offer of course fell on deaf ears. In 2015 in Manila, Xi announced the formation of the AIIB, again announcing that it was open to the entire world. And now in 2016, he is doing the same with the FTAAP.

Indicating clearly which way the wind is blowing, the APEC affairs director at the Peruvian Foreign Ministry, Raul Salazar, announced that Peru, as the host of this year’s summit, thinks that the FTAAP is necessary. “This step taken in Beijing has forced all the members to face the reality that this is necessary for a number of reasons. Peru holds the position that we need an Asia-Pacific free trade area.”