http://www.businesstimes.com.sg/sub/...04464,00.html?
Published November 6, 2008
US PRESIDENTIAL ELECTION
Asia uneasy over Obama's tough stance on trade
But some analysts say he'd likely adopt a moderate line like previous US presidents
(BEIJING) Asian business people and analysts expressed hope yesterday that US president-elect Barack Obama will tackle the financial crisis with fresh vigour but anxiety over whether Washington will embrace more protectionist trade measures.
'The financial crisis has a great impact on the world. If Obama can reverse the tide, then certainly it's good,' said Liao Yi, deputy general manager of CHiNT Electronics Group, one of China's biggest producers of power-transmission equipment.
Japanese investors are hopeful that Democrat Obama's win, as well as his party's bigger majorities in the US Congress, will help speed along further measures to lift the US out of its economic woes, said Toshikazu Horiuchi, equity strategist at Cosmo Securities in Tokyo.
'There are expectations now for prompt economic stimulus measures,' he said.
Still, Kazuo Mizuno, chief economist at Mitsubishi UFJ Securities Co in Tokyo, cautioned that a new president could not deliver a quick fix for the US financial meltdown, which is dragging on global growth. He said the United States will likely need foreign financing - from Japan, China and the Middle East - to pay for bailouts of financial firms saddled with bad debts and other measures.
'Changing the president is not going to be enough to save the American economy,' Mr Mizuno said. 'Even the president is not going to be able to change America without help from the world.'
Many expressed unease about Mr Obama's pledges to vigorously enforce trade laws and criticism of a pending trade pact with South Korea that he says fails to address an imbalance in car shipments. The Democrats, traditionally viewed as more protectionist on trade than Republicans, now control the presidency and Congress.
Asia's leaders, led by an ascendant China, say they hope Mr Obama didn't really mean those campaign promises to protect American trade. And if he did, they are in better shape to object than ever before.
To Asian ears, Mr Obama's calls for tougher labour and environmental rules and steps to reduce the US trade deficit sound like thinly veiled protectionism, just as a global financial crisis makes exports more crucial than ever.
'The immediate concern with Obama will be economic relations,' said Wu Xinbo, deputy director of the Center for American Studies at Fudan University in Shanghai. 'The US will be less forthcoming in pursuing economic liberalisation in the Asia region' because of concerns about jobs lost to trade.
Mr Obama has said he is in favour of free trade agreements if they benefit the United States. He also has said he would pressure China to end what he calls the manipulation of its exchange-rate system. Washington and other trading partners say Beijing's currency, the yuan, is kept undervalued, giving its exporters an unfair price advantage and adding to China's multibillion-dollar trade surplus.
Other analysts said that despite Mr Obama's pre-election comments, he was likely to follow the example of previous US presidents and take a moderate line in office to preserve important trade relations with Asia.
'I'm not worried about what might happen after Obama's win,' said Qiang Yongchang, a professor at the Economy Institute at Shanghai's Fudan University. 'He may have talked tough, but based on past experience, that's just a tool to win over voters. Every candidate does that.'
Chinese expect that the change Mr Obama speaks of might involve some shift of policy on financial markets, and that would not necessarily hurt trade, Mr Qiang said.
'I think Mr Obama will soon find out how important China's economy is, not just for the US but for all the world,' Mr Qiang said. 'Obama will need us, as the US needs China.' - AP, Bloomberg