Last week’s trade truce between Donald Trump and Xi Jinping has deferred all-out trade conflict between the world’s two great geoeconomic superpowers. But the rivalry remains in lower-profile theatres of combat, including the struggle between Washington and Beijing to pull other countries into their economic orbits.
A few days before the summit, the US apparently gained some valuable south-east Asian territory in that particular ground war in the form of deals with Cambodia and Malaysia. The agreements — unusually detailed by Trump’s standards — were the first of a planned string of deals with Asean nations that not only gave American exports highly preferential treatment but also appeared to recruit the countries firmly into the US geoeconomic gang.
On the face of it, this is evidence of a newly politicised trading system, countries forced to choose between the US and China. In reality, I strongly suspect governments will continue to chart a course between the two, which will depend on real-world incentives like access to rare earths or export markets rather than signing pieces of paper.