Friday, November 18, 2005

China now APEC's leader

Dr Mahathir would have like this, that China has replaced the USA as APEC’s leader both economically and politically. Its mega economic boom is racing away at a blistering pace, while the USA has been preoccupied with its disastrous and debilitating adventure in Iraq, and trade deals with other less significant regions.

The additional news that may delight Dr Mahathir is that China is ASEAN’s biggest export market. China-ASEAN trade shot up by 25% to almost US$60 billion in the first half of 2005, while ASEAN is now China's 5th largest export market and 4th largest trading partner

If I am not mistaken, Mahathir’s aspiration was to create an East Asian trading bloc to rival the EU and NAFTA. It certainly has the faint possibility of coming true, though I doubt that China, Japan and Korea would ever abandon the USA and EU as principal trading partners.

For example, China's trade suplus with the USA last year was US$162 billion and the year before, US$123 billion - those are humongous sums, but this year, 2005, the trade suplus in China's favour is expected to rocket up to US$200 billion.

Precisely because of these rather nice set of figures, China is unlikely to go to war anywhere, save over Taiwan, and only if Taiwan abandons the common 'One China' policy in a provocative manner, like making Beijing 'lose face'.

Why go to war when making money is more fun and profitable? So Dr Mahathir's dream of an East Asian trading bloc must wait that bit longer while China sells as much as possible to America.

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