Gyeongju, South Korea – Leaders from the Asian and Pacific Rim pledged support for trade and investment that “benefits all” and ended a summit centered on an agreement between the leaders of the United States and China calling for a truce in the trade war.
The declaration by Asia-Pacific Economic Cooperation (APEC) leaders on Saturday came after U.S. President Donald Trump and Chinese President Xi Jinping agreed to de-escalate the escalating tensions between the United States and China during a high-stakes summit held on the sidelines of the event.
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President Trump departed South Korea on Thursday after meeting with President Xi, their first face-to-face meeting since 2019, with the Chinese leader set to take center stage at a two-day economic forum.
Xi, who has positioned China as a champion of multilateralism and free trade, opened the event on Friday by saying countries needed to work together as they faced an “increasingly complex and unstable” global environment.
In their declaration, APEC leaders said “robust” trade and investment are essential to the region’s growth and emphasized their commitment to “deepening economic cooperation to navigate an evolving global environment.”
APEC, which includes 21 member countries including the United States, China, Japan and South Korea, will promote “market-driven” economic integration and enhance “experience sharing, capacity building and business engagement,” the declaration said.
The two leaders also committed to regional cooperation on demographic challenges arising from artificial intelligence and declining birth rates.
Prior to the declaration, South Korean President Lee Jae-myung, the host of the summit, warned that the world was entering an era of increasing economic uncertainty.
“The free trade system has suffered major disruption, global economic uncertainty has deepened, and trade and investment momentum has weakened,” Li said.
“Hard practice”
Saturday’s statement was notable for not directly mentioning multilateralism or the World Trade Organization, a reminder that agreements on free trade are fraying amid the rise of populism around the world.
Deborah Elms, head of trade policy at Singapore’s Heinrich Foundation, said it was “probably a miracle” that the leaders were able to agree on a joint statement.
“It was a difficult task to incorporate the agreed language into the document, given the strong positions of some APEC countries,” Elms told Al Jazeera.
“Typically these things come together long ago. This issue hung in the balance until the last moment, as authorities traded language to find an acceptable compromise.”
Mr. Xi met with the leaders of Japan, Canada and Thailand the day before, but joined Mr. Lee late Saturday for the first bilateral summit since the South Korean leader was elected in a June poll.
In his opening remarks, Lee expressed his hope that South Korea and China would “strengthen strategic communication” in preparation for resuming dialogue with nuclear-armed North Korea. North Korea has repeatedly denied South Korea’s efforts to get closer.
“The importance of regional peace and stability cannot be overstated,” Lee said.
Mr Lee also called for the two countries to work together towards “shared prosperity” as they move from a “vertical” model of economic relations to one that is “horizontal and mutually beneficial.”
Xi described China and South Korea as “inseparable and important neighbors” and “inseparable cooperation partners” and called on the two countries to manage their differences through “friendly consultations”.
Mr. Lee has vowed to pursue a more balanced China policy than his conservative predecessor, Yun Seok-yue, who was impeached for briefly imposing martial law last year.
South Korea, like other countries in the region, has had to walk a fine line between its security guarantor, the United States, and its largest trading partner, China.
The United States has about 28,500 troops stationed in South Korea and is obligated by treaty to come to South Korea’s defense if it is attacked, a vestige of U.S. support for South Korea during the 1950-1953 war with North Korea.
South Korea will send nearly one-fifth of its exports to China in 2024, with shipments valued at $133 billion.
The United States was the country’s second largest export destination, with shipments valued at $127.8 billion.
Relations between South Korea and China have been tested by a series of conflicts in recent years, most notably the dispute over the US deployment of the THAAD missile defense system to South Korea in 2017.
Rob York, regional affairs director at the Hawaii-based Pacific Forum, said Mr. Lee wants South Korea’s most important relationship to “remain stable, and that means de-escalating tensions with China, preventing a sharp deterioration in relations with the United States and building on the diplomatic heavy lifting his predecessor did with Japan.”
“For now, that means having friendly relations with both President Xi and President Trump, even as President Xi is taking steps behind the scenes to reduce dependence on the United States for security and counter China’s hybrid warfare operations in South Korea related to maritime issues and technology theft,” York told Al Jazeera, referring to China’s official name, the People’s Republic of China.
“Initial signs suggest that Mr. Lee is taking these issues seriously, but he intends to do so cautiously. There’s not much to be gained by gushing about these issues in public at this time.”
