APEC leaders fail to agree on final communique

Marco Green
November 20, 2018

Beijing on Monday downplayed the unprecedented fallout from this year's APEC summit, which for the first time ever failed to issue a joint statement after US-China trade tensions boiled over.

"But APEC leaders continue to focus on the efforts about trying to reduce inequalities, focus on making sure there is economic diversification, and working together so we can remove trade barriers, so that we can drive growth and ensure prosperity for all the people", said Peter O'Neill, Prime Minister of Papua New Guinea.

Speaking to media in Port Moresby following the leaders' impasse, O'Neill said there were "two big giants in the room".

As host of the APEC summit for the first time, Papua New Guinea took every opportunity to educate its guests on the culture and history of their hugely diverse country.

The US and China presented contrasting visions for the future of trade and investment in the region in competing policy speeches on Saturday.

China and the U.S. ignored sustained pressure from a series of countries and instead escalated their trade war at the Asia Pacific Economic Cooperation meeting.

Insiders said the sticking point was United States demands to include reference to reforming the World Trade Organisation and "unfair trade practices" - which Beijing took as an unsubtle dig.

-China trade war, saying, "Restrictive trade measures and countermeasures based on protectionism are expanding across the world". Yet the trade war has raised the prospect that nations will now need to pick sides, particularly as higher USA tariffs threaten to alter long-established supply chains.

During the summit, the U.S. said it would join Australia in developing a naval base in Papua New Guinea (PNG), in an apparent move to curb China's growing influence.

But Mr Xi warned the U.S. against a trade war, saying Washington risked an economic conflagration.

The Chinese delegates tried to forcibly enter Rimbink Pato's Port Moresby office on Saturday, in an eleventh-hour bid to influence a summit draft communique, but were denied entry, three sources said.

"There are always disagreements behind the scenes at these sorts of summits, but normally by the end, publicly, a document is published that all the leaders can put their names to", he said.

What happens next will depend on the meeting between Chinese President Xi Jinping and US President Donald Trump at the G-20 Summit in Buenos Aires later this month and whether talks can be set on the right way, he noted.

Xi urged the world to "say no to protectionism and unilateralism", warning it was a "short-sighted approach" that was "doomed to failure".

Vice President Mike Pence sharpened USA attacks on China during a week of summits that ended Sunday, most notably with a call for nations to avoid loans that would leave them indebted to Beijing.

"The entire world is worried" about tensions between China and the US, Mr O'Neill told a mob of reporters that surrounded him after he confirmed there was no communique from leaders. The US is slated to "more than double" current tariffs on China, lifting the targeted tariff rate to 25% across the board.

Although the U.S.is not a claimant country in the South China Sea, it conducts freedom-of-navigation operations in worldwide waters around the disputed area and calls out China's alleged militarization in the region. The "opaque" loans came with strings attached and build up "staggering debt", Pence charged, mocking the initiative as a "constricting belt" and a "one-way road".

He urged nations instead to stick with the United States, which doesn't "drown our partners in a sea of debt" or "coerce, corrupt or compromise your independence".

"The assistance provided by China has been warmly welcomed by our partners in this region and beyond", Wang Xiaolong, a foreign ministry official, told a news conference.

He pledged that China will increase its input for the development and prosperity of the Asia-Pacific region.

Southeast Asian countries were "desperate fence sitters" that don't want to make China an enemy, said Pei, who is a professor of government at Claremont McKenna College in California.

Other reports by Click Lancashire

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