This article discusses the effects of president elect- Donald Trump’s policies on Asia; namely Japan, China and India
Donald Trump’s accession to the White House as the 45th president of the USA is an event unlike any. In fact, before we drift into to the more serious consequences of this election’s effects on Asia, let me enlighten you about a golden opportunity you just missed this season. A spokesperson for Paddy Power (a betting house) told Mirror Online that their odds on a Leicester City/Brexit/Trump triangle would have been a whopping 3,000,000/1. So if you put a £5 bet on back at the beginning of the year, you’d be getting £15 million back today.
Shifting to more serious business now, the election result has some serious consequences for Asia, namely for China, Japan and India. Throughout the campaign, Trump tore the Trans-Pacific Partnership calling it one of the worst deals been signed. The TPPA (as popularly known),an agreement between 12 pacific rim countries, is in dangerous waters now. This opens a window for China (a non-member of TPPA) and shuts one for Japan.
The Japanese Parliament’s efforts to fast track the TPPA ratification process in order to leave no room for any further negotiation in the event of a Clinton victory are now worthless. Given the present circumstances the much anticipated treaty seems to be further than ever. Even though some officials have Japan have considered the possibility of a treaty without USA, it remains an unattractive option since TPPA’s selling point was its reduced tariff entry to the US market.
On the other hand, the crack culminates into a favourable scenario for the Chinese. Xi Jinping will be working on his own economic co-operative treaty as a counter to the TPPA. The South China Sea remains an important playground for exertion of soft power. Trump’s campaign shifted much weight from America as a global power and is to see an interesting turn of events in its operation in the South China Sea where the Philippines has already baited. President Rodrigo Duterte dropped major allegations in the South China Sea and received billions of dollars worth of promised investments’ in return on his recent trip to Beijing. China has a clear message: accept our power and be showered with gifts.
There remains a more interesting play between USA and India. Indian Prime Minister Narendra Modi congratulated Mr. Trump on his victory and tweeted to work to even better relations. Given the high-scale tensions with Pakistan, it will be interesting to see if the Indian PM is able to work his magic on the new president as well. Abe will try his best to lure the Indian PM into economic cooperation on his visit to Japan.
News on the economic front remains grave according to the IMF. Yields on 10-Year US Treasury Bonds have reached new highs in anticipation of inflationary pressure. According to major financial institutions this will have a severe effect on highly indebted countries in the Asia region where loans are much needed infrastructure development.
It is safe to conclude that the following year will be crucial for a number of reasons ranging from diplomatic and military. The only option is to tighten the seat belts and hope for a safe landing given the current level of turbulence.