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Business News/ Politics / Policy/  Asian politics gets trumped along with growth

Asian politics gets trumped along with growth

No world leader moved quicker to embrace the reality-TV-star-turned-president than Prime Minister Shinzo Abe

Shinzo Abe is struggling to explain his naivete and halt the plunge in approval rates. Photo: reutersPremium
Shinzo Abe is struggling to explain his naivete and halt the plunge in approval rates. Photo: reuters

Shinzo Abe’s five years running Japan have faced their fair share of snafus: cronyism scandals, deflation, slowing Chinese growth, wacky comments by cabinet members. But history may show his undoing was Donald Trump.

No world leader moved quicker to embrace the reality-TV-star-turned-president than Prime Minister Abe.

Since then, the US leader killed international agreements vital to Tokyo, started a trade war, coddled North Korea’s leader and made clear he couldn’t care less about Asia’s priorities.

Abe is struggling to explain his naivete and halt the plunge in approval rates.

South Korea’s Moon Jae-in also risks getting trumped. Elected to restructure Asia’s third biggest economy, Moon pivoted instead to détente with Pyongyang.

That move seemed to pay off when Trump swung from threatening Kim Jong-un with “fire and fury" attacks to a peace footing.

But Trump’s summit with Kim devolved into embarrassing and slobbering praise for the murderous regime to Moon’s north.

Then Trump threw Seoul under the bus, canceling military exercises vital to South Korean security—and leaving Moon shocked and exposed politically.

Japan and South Korea are on the front lines of how Trump is blowing up political agendas in Asia.

Until now, the fallout from Trump’s erraticness was mostly an economic concern.

Trump killing deals on trade, climate and other issues were survivable events. Some Trump tantrums could be addressed with fiscal and monetary stimulus, others by summoning the political will to offset the void from Washington.

But the Trump effect could be an existential crisis for Abe, Moon and others in Asia.

Narendra Modi must be careful about his “close relationship" with Trump (according to the US State Department).

The Washington Post’s scoop that Trump at times does a mocking Indian accent when speaking of Modi surely doesn’t help.

But with 2019 elections beckoning and Trump’s immigration policies sure to irk the Indian diaspora, Prime Minister Modi must manage perceptions.

India could be a subject of investigations as Trump family business ventures draw scrutiny.

India also is home to the world’s third largest Muslim population. Trump, it goes without saying, is no friend to followers of Islam.

That leaves limited latitude for Muslim-majority Indonesia to work with the Trump White House.

The same goes for Malaysia’s new Prime Minister, Mohamad Mahathir.

But Abe’s Trump miscalculation may be most instructive. In November 2016, Abe won rave reviews from Tokyo pundits for racing to New York’s Trump Tower, the first world leader to do so.

Abe’s calculus seemed logical. By feeding Trump’s ego, Tokyo would preserve the US-Japan military alliance and win preferential treatment on trade issues.

Things went awry immediately.

Trump, weirdly, brought his kids to the Abe meeting, a show of disrespect. Then he killed the Trans-Pacific Partnership that Abe had expended vast amounts of political capital joining.

Next, Trump’s treasury secretary Steven Mnuchin ended the 23-year-old strong dollar policy, a threat to Japan Inc. exporters.

The White House refused to give pal Abe’s economy a pass on steel and aluminum tariffs of 25% and 10%, respectively. Trump is preparing 25% taxes on car imports.

All this is slamming Abe’s reflation drive. Last week, the Bank of Japan admitted defeat in generating 2% inflation. This was supposed to be the year Abenomics finally gave workers a sizable raise.

As Trump tosses grenades at trade flows, Japan could skirt recession anew. Abe, though, faces another Trump-related downturn: in his support rates.

Moon can’t be happy either. Over time, Trump will realize that Kim played him, winning US concessions and giving Trump zero.

When Trump reverts to fire-and-fury rhetoric, Moon will pay a big political price. His neglect of economic retooling is one problem. The bigger one is how Moon outsourced Seoul’s foreign policy to a White House that can neither be trusted nor shoot straight policy-wise.

Granted, Abe, Moon and their Asian peers need to deal with the US leader they have, not the one they prefer. But the game is now about minimizing the fallout from a White House that views Asia as an annoyance, not an equal partner. Managing the Trump effect is now arguably the biggest risk facing Asia’s political machinations, one site to get worse in the months ahead.

William Pesek, based in Tokyo, is a former columnist for Barron’s and Bloomberg and author of Japanization: What the World Can Learn from Japan’s Lost Decades.

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Published: 21 Jun 2018, 09:15 PM IST
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