APEC Fails To Reach Consensus As U.S.-China Divide Deepens

Clay Curtis
November 19, 2018

The 21 nations at the Asia-Pacific Economic Cooperation summit in Port Moresby struggled to bridge differences on the role of the World Trade Organisation, which governs global trade, officials said.

The nation's growing influence in Papua New Guinea was on display in Port Moresby: dozens of red Chinese flags line a new six-lane highway built by China, while a giant billboard shows Xi shaking hands with Prime Minister Peter O'Neill.

Xi also said that no one would gain from heightened tensions between the U.S. and his emerging superpower.

Deep divisions between the United States and China have derailed the APEC meeting in Port Moresby, with regional leaders failing to agree on a final communique for the first time in the summit's history.

"China was angered that the reference to WTO blamed a country for unfair trade practices".

He said the U.S. is interested in a better relationship "but there has to be change" from China's side.

Pence said in a blunt speech on Saturday there would be no end to US tariffs on $250 billion of Chinese goods until China changed its ways. "Those prevented there from being a full consensus on the communique".

The stoush over trade came against the backdrop of deepening regional competition between China and the U.S. in the Asia-Pacific.

Pence warned smaller countries not to be seduced by China's massive Belt-and-Road infrastructure programme, which sees Beijing offer money to poorer countries for construction and development projects.

APEC leaders divided after US, China spat

The world, according to Mr Xi's speech, is facing a choice between cooperation and confrontation as protectionism and unilateralism grows.

The feisty barbs on a gleaming white cruise ship moored in Port Moresby set the scene for a potentially fiery meeting between Xi and US President Donald Trump at the G20 summit in Argentina at the end of this month. "They begin with trade practices, with tariffs and quotas, forced technology transfers, the theft of intellectual property".

"China has an honored place in our vision of a free and open Indo-Pacific, if it chooses to respect its neighbors' sovereignty, embrace free, fair, and reciprocal trade, and uphold human rights and freedom.

This is a short-sighted approach and it is doomed to failure", he said.

The APEC summit has developed into a tussle for influence between an increasingly assertive China and a more withdrawn US.

Asked about the incident, Chinese foreign ministry official Zhang Xiaolong told reporters: "It's not true". It is not a solicitation to make any exchange in commodities, securities or other financial instruments. "I think there is a lot more progress being made here than I think is probably being acknowledged", he said.

On Sunday, as he left the PNG capital of Port Moresby, he listed US differences with China. But the USA and allies are countering with efforts to finance infrastructure in Papua New Guinea and other island states.

The United States and three of its allies, including Japan, on Sunday unveiled a $1.7 billion plan to provide electricity and internet to much of Papua New Guinea, the first step of a plan that will counter China's "Belt and Road" spending in the region.

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