ANNUAL REPORT

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tional order—both before and after the United States initiated the
Rebalance—remains a key point of friction between the two countries
and their respective visions for the region.
In economic terms, China has worked over the course of the Rebalance
to create new institutions such as the Asian Infrastructure
Investment Bank to enhance its role in regional economic development.
It has also sought to establish new trade agreements such
as the Regional Comprehensive Economic Partnership and bilateral
free trade agreements with U.S. allies such as Japan, Australia,
and South Korea. These agreements may lessen the negative trade
distortion effects on China that might arise if TPP were approved
and impose fewer constraints on China than would a U.S.-led trade
agreement, due to their weaker provisions. China has also sought to
place itself at the center of a new network of regional infrastructure
projects by pledging massive resources to its OBOR initiative.
Conclusions
• U.S. government statements have tied the Rebalance strategy
to the upholding of the “liberal, rules-based international order”
in the Asia Pacific, viewing the preservation of this order
as broadly aligning with U.S. interests. It represents a tactical
adjustment rather than a strategic shift in U.S. policy, seeking
to maintain U.S. commitments to the region in an era of new
challenges to these interests.
• Although China has voiced measured criticism of the Rebalance
in official statements, opposition at other levels indicates
a deeply negative perception overall. China has also
expressed support for alternative regional security and economic
frameworks, pursued coercive actions against neighboring
countries in violation of its international commitments,
and sought to promote its own free trade agreements
since the Rebalance began.
• China alternately supports or challenges the international order
based on varying interests, a point of friction in the Asia
Pacific, where proximity and core territorial interests factor into
Beijing’s views. China’s current leaders probably do not have
foreign policy goals that are fundamentally different from those
in the past, but are more assertive in making tactical decisions.
These observations shed light on why Beijing has undertaken
its current regional approach.
• The United States has attempted to emphasize that the Rebalance
is focused on upholding principles, not on countering
China for its own sake.
• To date, the Trans-Pacific Partnership is the only fully-developed
significant economic component under the Rebalance. By
its very nature as a free trade agreement, it does not address all
U.S. economic interests and objectives in the region.
• Other economic initiatives under the Rebalance have been relatively
small. Trade with Asia has increased under the Rebalance,
and U.S. trade with China has grown faster than in other
Asian countries.