Asia-Pacific leaders failed to agree on a communique at a summit in Papua New Guinea on Sunday for the first time in their history as deep divisions between the United States and China over trade and investment stymied cooperation, Reuters reports.
Competition between the US and China over the Pacific was also thrown into focus with Washington and its Western allies launching a coordinated response to China’s Belt and Road program, the report said.
“You know the two big giants in the room,” Papua New Guinea (PNG) Prime Minister Peter O’Neill said at a closing news conference, when asked which of the 21 members of the Asia-Pacific Economic Cooperation (APEC) group could not agree.
O’Neill, who was chairman of the meeting, said the sticking point was over whether mention of the World Trade Organization and its possible reform should be in the Leaders’ Declaration.
“APEC has got no charter over World Trade Organization, that is a fact. Those matters can be raised at the World Trade Organization.”
The multilateral trade order that APEC was established in 1989 to protect is crumbling as Chinese assertiveness in the Pacific and US tariffs strain relations in the region and divide loyalties, the report noted.
US President Donald Trump did not attend the group’s latest meeting, sending his deputy, Vice President Mike Pence, instead.
Chinese President Xi Jinping arrived to great fanfare on Thursday and was feted by PNG officials. He stoked Western concern on Friday when he met Pacific island leaders to pitch his Belt and Road initiative.
The United States and its allies, Japan, Australia and New Zealand, countered on Sunday with a US$1.7 billion plan to deliver reliable electricity and the internet to PNG.
One diplomat involved in the negotiations told Reuters that tension between the US and China, bubbling all week, erupted when the Chinese government’s top diplomat, Wang Yi, objected during a leaders’ retreat to two paragraphs in a draft document.
One mentioned opposing “unfair trade practices” and reforming the WTO, while another concerned sustainable development.
“These two countries were pushing each other so much that the chair couldn’t see an option to bridge them,” the source was quoted as saying.
“China was angered that the reference to WTO blamed a country for unfair trade practices.”
Pence said in a blunt speech on Saturday there would be no end to US tariffs on US$250 billion of Chinese goods until Beijing changes its ways.
On Sunday, as he left the PNG capital of Port Moresby, he listed US differences with China.
“They begin with trade practices, with tariffs and quotas, forced technology transfers, the theft of intellectual property. It goes beyond that to freedom of navigation in the seas, concerns about human rights,” Pence told reporters.
Pence also took direct aim at Xi’s signature Belt and Road initiative, saying in his speech that countries should not accept debt that compromises their sovereignty.
“We do not offer a constricting belt or a one-way road,” he said.
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