Getting Rebalancing Right

Four key issues that will define President Obama's second-term pivot to Asia.


During the recently concluded presidential election campaign, the foreign policy debate largely turned on events in the Middle East and North Africa — a region that is once again at the fore in light of continuing violence in Gaza and Israel. But the region that will likely have the greatest impact on U.S. economic and security interests in this century was conspicuously absent: the Asia-Pacific. Accounting for half the world’s population and gross domestic product — and nearly half of global trade — Asia is undergoing a fundamental shift in the balance of power. With the rise of China and India, the United States has a unique leadership role to play in underwriting the stability of this critical region. President Barack Obama’s ongoing trip to Burma, Cambodia, and Thailand — his first overseas trip since re-election — highlights the importance his administration places on "rebalancing" to Asia. It also provides a timely opportunity to assess the implications of this policy going into the president’s second term.

Over the past four years, the Obama administration has intensified diplomacy in the region, expanded bilateral partnerships, and rebalanced military resources to Asia. The administration has sought to deepen relationships with treaty allies like Australia, Japan, Korea, the Philippines, and Thailand — which the president visited over the weekend to discuss trade and security cooperation. It has also sought to broaden ties with key partners such as India and Vietnam, and invest in the region’s key multilateral forums. Last year, Obama was the first U.S. president to attend the East Asia Summit, which brings together all of the region’s major and emerging powers to discuss a wide range of regional concerns, including energy and the environment, maritime security, non-proliferation, and disaster response. This year, as the summit kicks off in Phnom Penh, he will be in attendance again, underscoring his consistent message that the United States sees itself as a resident power in Asia.

The administration’s military strategy in Asia has bolstered regional partnerships, enhancing our work with partners throughout Southeast Asia to build their defense capacities. It is also beginning to revamp U.S. defense posture in the region — with initiatives such as shifting more of our naval fleet to Asia, stationing littoral combat ships in Singapore, and rotating up to 2,500 Marines through Australia — to make our posture more strategically relevant, operationally resilient, and politically sustainable. In addition, the Pentagon’s January 2012 strategic guidance called for increased investment in future capabilities to safeguard the U.S. freedom of maneuver in the face of so-called "anti-access and area denial" threats.

This rebalancing has drawn criticism from both ends of the spectrum, however. Some have labeled these changes more rhetorical than substantive; others have mischaracterized the approach as an aggressive effort to contain China.

While nether is true, the administration’s Asia policy will undoubtedly require continued calibration. However, rebalancing to Asia is about far more than U.S. security interests. It is driven first and foremost by the reality of U.S. economic interdependence with the region as a whole. To that end, the Obama administration has appropriately made the promotion of trade and investment a central plank of its Asia policy. Over the past four years, the administration signed a Free Trade Agreement with South Korea; announced $10 billion in trade deals during the president’s November 2010 visit to India; hosted the largest-ever U.S.-Association of Southeast Asian Nations (ASEAN) business forum; and is currently negotiating the Trans-Pacific Partnership, which spans nine countries and represents one of the world’s most expansive trade agreements.

So what are the key issues that will influence the U.S. rebalancing to Asia in a second Obama administration?

The first is the inextricable link between the U.S. economy and Asia. A strong U.S. economy is vital to its ability to project power and influence in Asia. The outcome of the ongoing budget talks and potential sequestration cuts will have a direct effect on diplomatic and military resources that can be committed to the region. Moreover, widening the economic lens on Asia from the campaign focus on currency issues with China to how the United States can tap the broader export market across Asia is essential to growing the U.S. economy and creating jobs.

Second, with a new Chinese leadership assuming power this month, there is some question as to the future direction of Beijing’s foreign policy. While a radical shift is unlikely, there is some risk that China’s economic slowdown will spark additional internal unrest which may tempt the new leadership to tap into nationalistic sentiment on foreign affairs in order to rally popular support for the regime. The new Chinese leadership thus has a balancing act before it, particularly in dealing with its neighbors on contested maritime claims, and in asserting its interests without generating regional instability that could encumber its economy and diminish its strategic position.

Third, the Chinese do not have a monopoly on nationalism. Other countries in the region have experienced outcries of nationalist sentiment in their disputes with China in the South and East China Seas, and also with each other (think Japan and Korea in the Sea of Japan). Given the potential for such disputes to ratchet up tensions and entangle the United States in conflict, the United States should continue to emphasize the importance of resolving these disputes peacefully and in accordance with international law.

Fourth, the administration’s ability to credibly encourage the resolution of maritime disputes — a key element of regional stability — argues for revisiting the ratification of the U.N. Convention on the Law of the Sea in the second term. Doing so would shore up U.S. credibility to push back on expansive maritime claims and preserve critical freedom of navigation and resource exploration rights in the region.

Finally, personalities matter in diplomacy. To the extent that the rebalancing has been successful, it has been propelled by the continued focus and energy of a group of dedicated senior officials who have prioritized showing up consistently in key forums and engaging widely across the region. The administration’s next team will need to sustain these efforts.

As the United States emerges from a decade of war in the Middle East and South Asia, President Obama has rightly stated that the United States is at a strategic inflection point: it has an opportunity to shift more of its attention and resources to the region that will drive economic prosperity and security more than any other in the 21st century. Critically important imperatives exist alongside — such as continued U.S. attention to and leadership in the Middle East, as underscored by the events unfolding in Gaza. Yet President Obama’s rebalancing to Asia, while not risk-free and still taking full form, is vital to long-term U.S. interests. The president’s ongoing trip is an important continuation of that effort — one that will have implications not only in his second term but also for administrations to come.

Michèle Flournoy is a co-founder and managing partner of WestExec Advisors. She served as U.S. undersecretary of defense for policy from 2009 to 2012.

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