As the specter of Donald Trump’s protectionist trade policies looms on the horizon, Asia-Pacific nations are wasting no time in recalibrating their trade priorities. At the annual Asia-Pacific Economic Cooperation (Apec) summit in Lima, Peru, leaders from 21 of the world’s largest economies have rallied around a resounding message: inclusive trade is the way forward.
Apec Leaders Champion Inclusive Trade
Australian Prime Minister Anthony Albanese, one of the most vocal advocates for free trade at the forum, underscored the importance of “inclusive trade and investment” in lifting living standards across the region. In a press conference, Albanese shared that his fellow Apec leaders consistently “spoke about the importance of free and fair trade between our economies.”
The Australian leader’s sentiments were echoed by others, including Indonesian President Prabowo Subianto and Peruvian President Dina Boluarte, both of whom met with Albanese on the sidelines of the summit. These discussions, centered on bolstering trade ties, reflect a wider trend among middle powers seeking to diversify their economic partnerships.
Trump’s Shadow Over Apec
The proactive stance adopted by Apec nations is hardly surprising given the looming threat posed by incoming US President Donald Trump’s trade agenda. Trump has vowed to impose tariffs ranging from 10% to 60% on imports, with Chinese goods facing the steepest penalties. This protectionist pivot has sent shockwaves through the global trade landscape.
“The election of Donald Trump has overshadowed everything” at the Apec forum, according to Bryce Wakefield, chief executive of the Australian Institute of International Affairs.
Wakefield noted that even US President Joe Biden, in his final days in office, has been reduced to a “mega lame-duck” as nations brace for a stark departure from his trade policies under a Trump administration. This uncertainty has spurred a flurry of activity among Apec members.
Middle Powers Seek Trade Diversification
Faced with the prospect of diminished access to US markets, many Asia-Pacific nations are scrambling to strengthen regional trade ties and explore new opportunities beyond American shores. China, despite facing the brunt of Trump’s proposed tariffs, is emerging as an increasingly attractive partner for some.
However, the real story lies in the flurry of activity among the region’s middle powers. As Wakefield observes, “You can predict a lot more coordination between mid-sized economies as they attempt to diversify their relations away from the United States during such a fraught period.” This collective pivot could redraw the trade map of the Asia-Pacific.
Green Shoots for Australian Trade?
For Australia, Trump’s ascent could yield unexpected benefits. If the incoming president scraps Biden’s Inflation Reduction Act, which incentivizes green energy investment in the US, Australia’s mineral wealth could make it a prime destination for redirected capital.
“A lot of that investment may now be redirected towards countries with resources that are crucial to the green economy, and Australia is one of those countries with important resources like lithium,” explained former Australian trade minister Craig Emerson.
To capitalize on these opportunities, Australia is championing trade liberalization measures such as digitizing trade documents, promoting its green agricultural products, and fostering trade cooperation. As Emerson notes, “We are great champions of free and open trade, and it gives Australia an opportunity to reaffirm that.”
Charting a Course Through Shifting Trade Winds
As Apec leaders navigate the shifting tides of global trade, one thing is clear: the Asia-Pacific is refusing to be a passive bystander. By proactively forging new partnerships, embracing inclusive trade principles, and exploring innovative avenues for growth, the region is positioning itself to weather the storm of protectionism.
The coming months and years will undoubtedly bring challenges, but they will also present opportunities for those nations nimble enough to adapt. As the trade winds shift, the Asia-Pacific is charting a course towards a more resilient, interconnected economic future – with or without the United States.
