Thank you, Phil. I’m glad to be in San Francisco, and with all of you here at the Commonwealth Club.
You’re here today because you understand the importance of Asia to America. This is especially evident in a Pacific Coast state like California. More than 5.5 million Asian-Pacific Americans live in California, and millions more Californians do business, study, or otherwise benefit from their ties with the region. California exported nearly $70 billion in goods to the region last year, more than any other state. And Asia matters to the entire United States – to our economy, to our security, to our families.
As a Pacific power and a trading nation, we can’t afford not to be in the Asia-Pacific. That’s why President Obama decided, before he even took office, to institute a long-term, strategic emphasis on the region. And I’m confident that strategy will extend far beyond his presidency, because we have strong bipartisan support for it – both parties understand the importance of Asia.
Now, there is a lot going on in Asia today, from the dramatic rise of China and the historic reforms in Burma, to the ongoing threat from North Korea's pursuit of nuclear weapons, to the dangerous tensions in the South China Sea.
And while I know that as a topic, “strengthening regional institutions” probably ties for last place with “corporate tax policy” in its headline-grabbing power, it's one of the most consequential undertakings in terms of American interests. And that's what I'd like to discuss with you today -- namely, the effort to shape a rules-based order that is stable, peaceful, open and free.
First let me say that the region I am responsible for--East Asia and the Pacific--is a diverse one. Northeast Asia, Oceania--which includes Australia, New Zealand, and the Pacific island states--and then Southeast Asia, are all quite different.
Northeast Asia is home to two of our important treaty allies – Japan and the Republic of Korea. We’ve modernized defense cooperation with both countries to address the very real threat posed by North Korea. And we’ve deepened economic engagement through free trade agreements such as the one reached with South Korea.
Northeast Asia is also home, of course, to China--with which we’ve dramatically increased our engagement.
I was with Secretary Kerry, Treasury Secretary Jack Lew, and other Cabinet officials earlier this month for the annual Strategic and Economic Dialogue covering nearly every area of our relationship with China, from concrete steps to combat climate change and wildlife trafficking, to preventing nuclear proliferation on the Korean Peninsula and in Iran, to facilitating business and investment between our two countries.
These exchanges show the conviction of both sides – as the world’s two largest economies, two of the strongest military powers, and the two largest carbon emitters – to cooperate on the world’s toughest problems whenever we can. And just as important, they show our shared commitment to tackle problem areas frankly and openly, instead of merely agreeing to disagree on issues like human rights or intellectual property protection.
Australia, New Zealand, and the Pacific island states are extremely important partners. We’ve upgraded our defense cooperation with our Australian treaty ally, and we’re working to create jobs and shared prosperity with both Australia and New Zealand through the TPP trade agreement.
We’re also working with the vulnerable island states to protect the environment. Last month, Secretary Kerry hosted the “Our Ocean” conference, a first-of-its-kind diplomatic effort rallying heads of state, scientists and advocates from the Pacific Island nations and beyond to protect this shared resource.
But in many respects, the dynamic center of the region is Southeast Asia, and the ten countries that make up ASEAN.
Let me first say a few words about each.
Our ally the Philippines is a stable democracy with strong economic growth. We completed an enhanced defense cooperation agreement during President Obama’s visit in April, which enables us to better address common security challenges and provide relief for disasters, such as Typhoon Haiyan. Our economies also continue to grow closer, with two way trade reaching $24 billion last year.
We have strong partners in Indonesia and Malaysia, both pluralistic and tolerant Muslim-majority nations with growing economies. Indonesia’s recent presidential election shows the strength of their democracy. And President Obama's recent visit to Malaysia highlighted our growing economic, people-to-people, and security ties.
Singapore is an influential and effective economic, diplomatic and security partner. Brunei is a major energy producer that, while small, has been a valuable partner for us on crucial regional issues like renewable energy and free trade.
Vietnam, of course, has a complicated history with the U.S. But our relations are now flourishing. Trade is increasing dramatically as Vietnam’s economy grows. And we’re forging closer security ties, even as we encourage greater political openness and respect for human rights.
We cooperate with Laos and Cambodia on a range of development issues, and we also push them to adhere to global standards of human rights.
With our longtime treaty ally Thailand, despite the recent setback of a military coup, we remain committed to our enduring friendship.
Perhaps no other country shows the promise of this region better than Burma, which has made a turn of historic proportions towards democracy and reform.
But that turn is by no means complete. Burma faces many challenges, and the success of its reform process is by no means certain. Burma is working to negotiate a lasting peace to end the world’s longest running civil war. It is grappling now with the key issue of constitutional reform, of military versus civilian control over its government, and of who it deems eligible to serve as head of state.
It continues to face hard choices in determining how to resolve an ongoing humanitarian crisis in Rakhine State. On that issue, we have seen some positive movement in the past week, as the government announced its intent to welcome the return of assistance providers, like Doctors Without Borders, and put forth its strategy on how to bring access to livelihoods and security back to populations that have been living tenuously for many months because of ethno-religious violence and discrimination.
Secretary Kerry will be very focused on seeing how this process is proceeding, when he visits in early August. He, and then President Obama when he visits in November, will be keen to get a sense of Burma’s preparedness for its landmark elections next year. The world will be watching, and we will continue to stand with the government and people of Burma as they enter this testing period. So we will continue to press Burma’s leaders to protect and respect all of their peoples, and their human rights and fundamental freedoms. And we will continue to support that country’s transformation.
That’s the overview of Southeast Asia today. The region’s economic dynamism and strategic importance has made it a particular focus of this administration – the ‘rebalance within the rebalance,’ if you will.
These ten countries have many differences, but they are bound by the conviction that they can achieve more together than they can apart. But before we talk about where they’re headed, it’s important to know how they came together.
Today’s ASEAN began in 1967 when the Vietnam War was heating up, and the Cold War seemed never-ending. In this uncertain world, five Southeast Asian nations signed a Declaration that they would support each other as they sought to build prosperous, independent states.
Now, nearly half a century after its founding, ASEAN has doubled to 10 nations with more than 620 million people, and a GDP of $2.2 trillion.
As Southeast Asia has grown and developed, ASEAN’s relations with the U.S. have grown as well. Under our Trade and Investment Framework Agreement signed in 2006, we have deepened our economic ties.
Since President Obama decided in 2009 to sign the Treaty of Amity and Cooperation--a treaty that ASEAN has extended to key neighbors--we’ve deepened our political ties as well. This is shown by the President's decision to participate annually in the East Asia Summit, as he will again this year in November. This commitment to enhanced engagement with ASEAN is a key feature of the rebalance.
And we're strengthening our ties with ASEAN across the entire U.S. government. Take this past April, when Secretary Hagel, USAID Administrator Raj Shah, and U.S. Pacific Commander Admiral Sam Locklear hosted defense ministers from the ASEAN nations in Hawai’i. This was the first-ever ASEAN meeting here in the United States--a recognition that our security and prosperity are more intertwined than ever before.
For instance, California already sells over $11.6 billion worth of goods to ASEAN. Exports to ASEAN support more than 90,000 California jobs [in 2012]. And both of those numbers can grow a lot more. Your state also stands to gain from more tourists and students from the region.
And ASEAN matters to the entire United States. We had $206 billion worth of trade in goods last year. ASEAN is our fourth-largest export market and trading partner. With a diaspora reaching across America, the region contributes to our culture. And sitting astride vital trade routes, it is important to our security.
A stable Southeast Asia that meets the aspirations of its people--for economic growth, clean air and water, education, and a voice in how they’re governed--is in America’s national interest. And one of the best, most efficient ways for America to help the region meet its aspirations is by investing in ASEAN.
Strengthening regional institutions is a long-term strategy. We pursue it because it’s essential to building the foundations for