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87–269 PDF 

" ! COMMITTEE PRINT 113TH CONGRESS

2d Session 

S. PRT. 

2014

113–24 

RE-BALANCING THE REBALANCE: 

RESOURCING U.S. DIPLOMATIC STRATEGY 

IN THE ASIA-PACIFIC REGION 

A MAJORITY STAFF REPORT 

PREPARED FOR THE USE OF THE 

COMMITTEE ON FOREIGN RELATIONS 

UNITED STATES SENATE 

ONE HUNDRED THIRTEENTH CONGRESS

SECOND SESSION

APRIL 17, 2014 

Printed for the use of the Committee on Foreign Relations 

Available via World Wide Web: 

http://www.gpoaccess.gov/congress/index.html 

COMMITTEE ON FOREIGN RELATIONS

ROBERT MENENDEZ, New Jersey, Chairman

BARBARA BOXER, California 

BENJAMIN L. CARDIN, Maryland 

JEANNE SHAHEEN, New Hampshire 

CHRISTOPHER A. COONS, Delaware 

RICHARD J. DURBIN, Illinois 

TOM UDALL, New Mexico 

CHRISTOPHER MURPHY, Connecticut 

TIM KAINE, Virginia 

EDWARD J. MARKEY, Massachusetts 

BOB CORKER, Tennessee 

JAMES E. RISCH, Idaho 

MARCO RUBIO, Florida 

RON JOHNSON, Wisconsin 

JEFF FLAKE, Arizona 

JOHN McCAIN, Arizona 

JOHN BARRASSO, Wyoming 

RAND PAUL, Kentucky 

DANIEL E. O’BRIEN, Staff Director

LESTER E. MUNSON III, Republican Staff Director

(II)

C O N T E N T S 

Page 

Letter of Transmittal ........................................................................................... v 

Executive Summary ............................................................................................. 1 

Recommendations ................................................................................................ 3 

Development of the Rebalance ............................................................................ 7 

Resourcing of the Rebalance ............................................................................... 8 

Diplomatic Engagement ................................................................................... 9 

Public Diplomacy .............................................................................................. 11 

Economic Statecraft .......................................................................................... 13 

Development Partnerships .............................................................................. 16 

Regional Architecture ....................................................................................... 17 

Partner Capacity Building ............................................................................... 19 

Civil Society and Human Rights ..................................................................... 20 

China and the Rebalance .................................................................................... 21 

Implementation of the Rebalance ....................................................................... 23 

Acknowledgements ............................................................................................... 27 

(III)

LETTER OF TRANSMITTAL 

UNITED STATES SENATE, 

COMMITTEE ON FOREIGN RELATIONS, 

Washington, DC, April 17, 2014. 

DEAR COLLEAGUES: This report by the committee’s majority staff 

examines the progress made on the non-military elements of the 

Obama administration’s policy to pursue a strategic rebalance towards the Asia-Pacific region. 

As Chairman of this committee, I believe that we have a duty 

and responsibility to assure national security resources are allocated efficiently and effectively to address U.S. foreign policy priorities—and to promote the time, effort and attention needed to safeguard our security and prosperity and advance our values. Given 

its significance for U.S. security, economic, political and diplomatic 

interests, a successful rebalance must underscore an enduring U.S. 

commitment to the Asia-Pacific region, and do so across the full 

range of U.S. Government activities. 

As this report finds, despite progress in some areas, implementation of the rebalance thus far has been uneven, which creates the 

risk that the rebalance may well end up as less than the sum of 

its parts. This report provides additional insight and perspective on 

the rebalance, and recommendations on how to properly resource 

and implement the rebalance to meet its strategic goals of enhancing prosperity, security, democratic values and human development 

in the Asia-Pacific region. 

Sincerely, 

ROBERT MENENDEZ, Chairman. 

(V)

(1) 

RE-BALANCING THE REBALANCE: 

RESOURCING U.S. DIPLOMATIC STRATEGY 

IN THE ASIA-PACIFIC REGION 

EXECUTIVE SUMMARY

In 1900, then Secretary of State John Hay declared that ‘‘the 

Mediterranean is the ocean of the past, the Atlantic the ocean of 

the present, and the Pacific is the ocean of the future.’’ Over 100 

years later, his words appear more prescient than ever. The economies of the Asia-Pacific region are increasingly important markets 

for U.S. exports of manufactured goods and natural resources. At 

the same time, an ever-larger proportion of global trade is passing 

through the region’s sea lanes, underscoring the continued need for 

the United States to help maintain maritime security and promote 

regional stability. The economic and strategic implications are 

clear: our future prosperity and security are intimately entwined 

with the prosperity and security of the Asia-Pacific region, and U.S. 

Government policy and resources must reflect this reality. 

The Obama administration recognized this need when it committed to ‘‘rebalance’’ U.S. Government attention and resources for 

the Asia-Pacific region. The strategy intends to strengthen U.S. 

economic, diplomatic, and security engagement throughout the region, both bilaterally and multilaterally, with a coordinated, 

‘‘whole-of-government’’ approach to policy implementation. In concept, the rebalance stands out as one of the Obama administration’s most far-sighted and ambitious foreign policy initiatives. 

The United States has successfully moved forward with the initial phases of implementing the military aspects of the rebalance. 

But given the broader strategic and policy goals, it is essential that 

the non-military elements also move forward with equal speed and 

weight. An ‘‘unbalanced’’ or under-resourced approach to the rebalance threatens to undermine the goals of the policy and, consequently, the prospects for greater prosperity and security in both 

the Asia-Pacific region and the United States. 

The Senate Foreign Relations Committee has a duty and responsibility to ensure that resources are allocated efficiently, effectively 

and appropriately across all U.S. foreign policy priorities, and to 

promote the time, attention and focus needed by the U.S. Government on critical but under-resourced areas of U.S. foreign and national security policy, including, first and foremost, Western Hemisphere affairs and the need for additional emphasis on economic 

statecraft in the Western Hemisphere. The Asia-Pacific region is 

significant for U.S. security, economic, political, and diplomatic interests, and the intent of this report is to provide additional insight 

and policy perspective on the rebalance in the context of this broadVerDate Nov 24 2008 10:10 Apr 17, 2014 Jkt 000000 PO 00000 Frm 00007 Fmt 6633 Sfmt 6633 S:\FULL COMMITTEE\HEARING FILES\113TH CONGRESS, 2ND SESSION\TOPIC-ISSUE 
2 

er range of global obligations and commitments vital to U.S. national security interests. 

To that end, the report addresses the question of how to best 

align ends, ways and means across the non-military aspects of the 

rebalance. It provides recommendations for how the administration—and Congress—can help address perceptions (some fair, others less so) of a lack of progress on the diplomatic, economic, and 

civil society elements of the rebalance. While due to the nature of 

the committee’s jurisdiction in the Senate this report does not go 

into detail on further developing our military alliances in the region, it encourages continued progress in upgrading our alliances 

with Japan, the Republic of Korea, Australia, Thailand, and the 

Philippines. The report also recognizes that the rebalance policy 

necessarily starts with our alliances and that renewing and refurbishing those alliances to meet the challenges of the 21st century 

must be a cornerstone of U.S. policy in the region. 

The methods of policy execution are just as important as the results: how a policy is pursued and perceived can impact its success 

as much as the actual mechanics of its implementation. To succeed, 

the rebalance must first address how resources are allocated within 

the U.S. Government, and then how they are deployed across the 

region. Some progress has been made. Congress anticipated the 

need to rebalance when it encouraged creation of the position of 

U.S. Ambassador to ASEAN; the State Department has created 

new diplomatic and assistance programs in the region, such as the 

Lower Mekong Initiative and the Asia-Pacific Strategic Engagement Initiative; the U.S. Government joined the East Asia Summit 

in 2011; and the U.S. Trade Representative is pursuing the expansion and completion of the Trans-Pacific Partnership multilateral 

trade agreement, as well as several bilateral investment treaties. 

Furthermore, trade promotion bodies like the Export-Import Bank, 

Overseas Private Investment Corporation, and U.S. Trade and Development Agency have increased their financial engagement with 

the region. 

Nonetheless, the State Department has not substantially increased diplomatic engagement resources to its Bureau of East 

Asian and Pacific Affairs. Department of Commerce staffing levels 

have not significantly increased, hindering the ability of U.S. businesses to take full advantage of new prospects. U.S. development 

assistance to the region, which saw a modest increase in the administration’s FY 2015 budget proposal, is still below levels from 

several years ago, and the U.S. development approach needs updating and upgrading. 

In contrast, the Department of Defense has moved rapidly and 

with an influx of resources. Definitive plans to move new assets 

into the region include 2,500 Marines in Darwin, Australia, an additional army battalion in South Korea, 2 missile defense destroyers to Japan, up to 4 Littoral Combat Ships in Singapore, as well 

as likely increased troop rotations in the Philippines and enhanced 

defense cooperation with Vietnam, Malaysia and others. The Department of Defense has moved more quickly and more coherently 

to rebalance resources than its far smaller civilian counterparts. 

While most governments have expressed support for greater U.S. 

engagement in the region, the strategy is currently perceived as 

3 

primarily a military strategy, a perception reinforced by the underresourcing of the civilian components. As a result, some countries 

in the region see the rebalance as an attempt to contain a rising 

China, which may limit their willingness to deepen cooperation and 

coordination with the United States. As the United States considers how to more fully shape and articulate the public diplomacy 

elements of the rebalance, it should make clear that the policy is 

about broadening U.S. engagement, not containing China; the rebalance seeks to expand economic growth, ensure regional security, 

and improve human welfare for the benefit of all, not the detriment 

of one. 

Congress must also do its part communicating to its domestic 

constituents and global counterparts the benefits of greater U.S. 

engagement with the Asia-Pacific region. Domestically, the case 

must be made that national security spending is not limited to our 

military but extends to the monies we spend on diplomacy and development efforts, which can help prevent situations that might 

otherwise require the use of our armed forces. In addition, sufficiently resourcing and implementing a successful rebalance will require new authorizations and appropriations from Congress. As recent events in Europe and the Middle East have demonstrated, any 

efforts by the administration to shift resources and monies from 

other regions to the Asia-Pacific can only go so far. Moreover, considering that the United States has vital interests in other regions 

as well—including the Western Hemisphere, a traditionally underresourced area for the State Department, USAID, and overall U.S. 

Government efforts—such rebalancing must be done carefully and 

within the context of a broader, global strategy. 

Given the constrained budget environment and unyielding calls 

from some in Congress for draconian cuts to all overseas government spending, finding new monies for the rebalance will be a challenge. But if the rebalance is to be a success, Congress must find 

a way. 

For now, the administration can improve the effectiveness and 

sustainability of the rebalance policy by increasing civilian engagement, strengthening diplomatic partnerships, and empowering U.S. 

businesses. We recognize there are institutional bureaucratic, political, and cultural barriers to implementing a rebalance of U.S. civilian power. Furthermore, we know that increased engagement 

with some countries will be hindered by their records on human 

rights and governance, as well as other challenges. However, a failure to adequately deploy U.S. civilian resources to the new global 

economic center of gravity will undermine the stated goals of the 

rebalance policy and the greater interests of the United States. 

RECOMMENDATIONS

The below recommendations lay out some steps the administration and Congress can take to properly resource and implement the 

rebalance to meet its strategic goals of enhancing prosperity, security, democratic values, and human development in the Asia-Pacific 

region. 

4 

Strategic Recommendations 

The rebalance reflects the need for the administration to approach the Asia-Pacific region with a well-coordinated, whole-ofgovernment approach. But that approach requires better synchronizing and sequencing the military-security elements with the diplomatic, economic, and civil society elements, so that all move in 

a parallel and mutually reinforcing fashion. For example, there is 

a logic that ties together the U.S. Government’s unilateral and alliance-based military and security activities in the region with its 

approach to regional architecture, the maritime commons, partners’ 

capacity building, support for international rules and norms, deepening alliances, and public diplomacy. However, that logic only 

works if resources are sufficiently allocated across the full spectrum of U.S. Government activities and properly deployed in a coherent, sequenced, and balanced fashion. To better achieve the objectives of the rebalance, the administration should: 

• Develop a multi-year, integrated, whole-of-government approach for the non-Department of Defense elements of the rebalance, with targets and timelines for the rebalance from civilian agencies—including both White House and Office of 

Management and Budget oversight—and linked back to the annual congressional authorization and appropriations cycle. The 

standard policymaking process has been insufficient in bringing about the shift in resources that the rebalance calls for. 

• Better communicate the goals and methods of the rebalance to 

the American public and our allies and partners. While it is 

important to maintain a positive vision, sweeping policy pronouncements unsupported by hard deliverables create a large 

gap between expectations and reality. Given the risks of a misalignment between rhetoric and action, the hallmarks of the 

rebalance should be that the United States under-promises and 

over-delivers. 

Getting the region right, through an effective rebalance policy, is 

necessary for getting China policy right. And with China now the 

world’s second largest economy and a major military power, getting 

China right is necessary for getting both regional and global policy 

right. Although the rebalance is not ‘‘only’’ about China, it is certainly ‘‘also’’ about China, including questions about China’s future 

trajectory. China will play a role in developing regional regimes. 

But the rebalance should seek to shape and encourage the development of a positive and productive China that is fully supportive of 

cooperative and constructive regional norms and institutions and 

that plays by regional rules-of-the-road and international law. To 

achieve that objective, the administration should: 

• More clearly articulate the necessary connections between U.S. 

bilateral policy towards China and the rebalance itself and better coordinate policy across the U.S. Government and with 

other regional partners. 

• Deepen and refurbish alliances, build out new partnerships— 

especially in Southeast Asia—and integrate alliances and partnerships into a networked approach where the United States 

plays a vital catalytic role. The core of U.S. policy and strategy 

in the region rests on our alliances and partnerships, which 

5 

will be essential to the success of the rebalance and U.S. policy 

in the region and beyond. 

Operational Recommendations 

• Diplomatic Engagement: To strengthen bilateral relationships and better pursue U.S. interests in the Asia-Pacific region, the U.S. Government should: 

Æ Increase personnel and resources to the State Department’s 

Bureau of East Asian and Pacific Affairs (EAP) both at State 

Department headquarters and abroad, as well as for other civilian agencies that work in the region. 

Æ Expand and improve inter-agency coordination and information sharing on the development and implementation of AsiaPacific policy. 

Æ Send cabinet-level principals to the region on a more frequent basis. 

• Public Diplomacy: To better foster business, cultural, and 

educational people-to-people connections between Americans 

and citizens of other Asia-Pacific countries, the State Department should: 

Æ Redouble efforts to attract and enable more U.S. students to 

study in Northeast and Southeast Asia. 

Æ Ensure faster processing and greater issuing of non-immigrant visas for tourism, conferences, and exchange programs. 

Æ Increase resources dedicated to public diplomacy and better 

integrate EAP’s public diplomacy efforts with those of the 

State Department’s other bureaus. 

• Economic Statecraft: To strengthen bilateral economic relationships, avail U.S. businesses of greater opportunities, and 

properly implement and monitor complex multilateral trade 

agreements, the U.S. Government should: 

Æ Increase capacity for strategic thinking on regional economic 

policy by creating a new Asia-Pacific office in the State Department’s Economic and Business Affairs Bureau, and reorganize other functional Bureaus within the State Department to create separate Asia-Pacific offices where feasible. 

Æ Fill all vacant Foreign Commercial Staff (FCS) positions at 

Asia posts and increase staff at select posts with the greatest 

growth potential, including Vietnam, Indonesia, the Republic 

of Korea, and China. In addition, improve the coordination 

of commercial diplomacy by reintegrating FCS officers into 

the State Department. 

Æ Continue to aggressively pursue bilateral trade deals, including a Bilateral Investment Treaty (BIT) with China, alongside larger trade agreements such as the Trans-Pacific Partnership (TPP). In addition, involve the Philippines, Indonesia, and Taiwan in either the TPP or bilateral trade discussions and increase U.S. Trade Representative (USTR) 

personnel and travel to meet the vastly expanded demands 

placed on the agency. 

• Development Partnerships: To improve human development 

outcomes in the Asia-Pacific region and lay the groundwork for 

6 

greater economic development, the State Department and 

USAID should: 

Æ Increase levels of development funding throughout the region and look at opportunities for greater coordination between U.S. export promotion and development agencies. 

Æ Institutionalize the successes of the Lower Mekong Initiative 

(LMI) and develop more programs that support ASEAN 

connectivity and that combine staff from across U.S. Government agencies and regional embassies. 

Æ Scale up public-private partnerships and explore greater 

donor coordination with European and other allies and partners, as well as China. 

• Regional Architecture: To expand and transform the U.S. 

role in Asia-Pacific multilateral institutions, which will play a 

critical role in developing regional economic and security 

norms and standards, the administration should: 

Æ Devote more diplomatic support and resources for the development of regional institutions to address maritime security 

issues. 

Æ Leverage U.S. expertise and capability in humanitarian assistance, disaster relief, and search and rescue to develop a 

leadership role on these issues in regional multilateral institutions. 

Æ Increase the high level and tempo of engagement with the 

region’s multilateral institutions. 

• Partner Capacity Building: To strengthen the U.S. relationship with bilateral partners and transform our multilateral approach to the region, the U.S. Government should: 

Æ Supplement the current bilateral hub-and-spoke relationship 

model to a more network-centric approach, where the United 

States helps facilitate a web of relationships throughout the 

region. 

Æ Enhance allies’ and partners’ maritime domain awareness 

capabilities by increasing bilateral maritime assistance and 

facilitating regional coordination on maritime security issues. 

Æ Expand across-the-board coordination with capable allies 

and regional institutions and increase rule of law assistance 

that targets both single-country and multilateral issues. 

• Civil Society and Human Rights: To improve the human 

rights situation in the Asia-Pacific region, which is a fundamental value of the United States and can improve the prospects for economic development, the U.S. Government should: 

Æ Incrementally engage with countries seeking to improve 

their human rights records, incentivizing specific improvements with the promise of a closer economic relationship. 

Æ Expand assistance programs that strengthen the rule of law, 

maritime enforcement, and public diplomacy, which are 

complementary to the goal of promoting human rights in the 

region. 

Æ Increase support for institutions such as the Asia Foundation and the East-West Center, which help to both build local 

7 

human capacity and also develop a cohort of U.S. Government personnel and private citizens with the expertise, ability, and ambition to advance U.S. values and interests in the 

region. 

• For Congress: To strengthen the legislative branch’s role in 

the rebalance and enhance the effectiveness and benefits of the 

policy, the U.S. Congress should: 

Æ Increase funding levels and consider new authorizations for 

departments and agencies involved in implementing the rebalance. 

Æ Increase the size and frequency of congressional delegations 

to the region to highlight its importance and build relationships with counterparts. Similarly, more members of Congress should meet with officials from the region when they 

visit Washington, D.C. 

Æ Give the United States a seat at the table in a critical international forum on maritime issues by giving advice and consent to ratification of the United Nations Convention on the 

Law of the Sea (UNCLOS). In addition, ratify reforms to the 

International Monetary Fund (IMF) that will give emerging 

economies in the region a greater stake in the institution, 

further weaving them into the existing international system. 

DEVELOPMENT OF THE REBALANCE

The rise of the Asia-Pacific region may well prove to be the single 

most transformative geopolitical shift of the 21st century. In the 

past 20 years, China and India’s share of the global economy has 

tripled. By 2025, the Asia-Pacific region will account for almost half 

of the world’s economic output. In 2011, U.S. exports to the AsiaPacific region totaled $895 billion and accounted for 60 percent of 

total U.S. exports. Those exports have created and sustained American jobs in vital industrial and service sectors of the U.S. economy. 

The region’s economic dynamism is accompanied by the hard and 

pressing challenges of its shifting security landscape, including the 

threat of North Korea’s nuclear weapons programs, on-going disputes over maritime security and territorial issues, and non-traditional security challenges like transnational crime and the effects 

of climate change. 

Building on efforts initiated in 2009 to focus additional attention 

on the Asia-Pacific region, the Obama administration in the fall of 

2011 and early 2012 formally announced that it would intensify the 

role of the United States in the Asia-Pacific region. To do so, it 

sought to raise the region’s priority in U.S. military planning, foreign policy, and economic policy. With U.S. troops gone from Iraq 

and poised to be drawn down in Afghanistan, administration officials said they intended to ‘‘rebalance’’ U.S. attention and resources 

toward planning for future challenges and opportunities, specifically those represented in the Asia-Pacific region, reflecting a recognition of the region’s growing importance for a range of U.S. interests. 

In her October 2011 article in Foreign Policy magazine entitled 

‘‘America’s Pacific Century,’’ then-Secretary of State Hillary Clinton 

wrote that the Obama administration would continue to ‘‘dispatch 

8 

1 U.S. Department of Defense, ′′Secretary of Defense Speech: Shangri-La Security Dialogue,′′ 

June 02 2012, http://www.defense.gov/speeches/speech.aspx?speechid=1681. 2The Wall Street Journal, ′′America is Committed to Asia,′′ February 17, 2014, http://online.wsj.com/news/articles/SB10001424052702304675504579388202324713822. 

the full range of our diplomatic assets . . . to every country and corner of the Asia-Pacific region.’’ Furthermore, the State Department’s FY 2013 Congressional Budget Justification for Foreign Operations refers to the Obama administration’s rebalancing policy as 

a principal driver of its objectives in the Asia-Pacific region: 

In order to advance the administration’s pivot to East 

Asia and the Pacific, the U.S. Government will maintain 

a presence in the region as a preeminent trade and investment partner, security guarantor, and example of democracy and good governance. This new strategy for the AsiaPacific region will guide the Bureau’s activities, including 

reinvigorating already strong relations with treaty allies, 

building new partnerships with emerging powers in the region, engaging with multilateral institutions, expanding 

trade and investment, forging a broad-based military presence, and advancing democracy, human rights, and the 

rule of law. 

While the U.S. military has made several high-profile and attention-grabbing deployments of additional resources to the Asia-Pacific region, U.S. civilian agencies have less clearly shifted their 

priorities. Though most regional policymakers and analysts outside 

of China have welcomed the rebalance, a frequent criticism of the 

initiative is that it is too military-focused and should be more diversified. U.S. military leaders have acknowledged the critical role 

of the non-defense aspects of the rebalance. In mid-2012, then Secretary of Defense Leon Panetta spoke of ‘‘the crucial part that diplomacy, trade, and development will play in our engagement [in 

the Asia-Pacific]’’ 1 and current Secretary of Defense Chuck Hagel, 

in a joint op-ed with Secretary of Commerce Penny Pritzker, wrote 

of how America’s ‘‘economic ties and people-to-people contact with 

nations like Japan, the Republic of Korea, Australia, Thailand and 

the Philippines have provided the necessary stability for Pacific nations to focus on giving their people a more inclusive, peaceful and 

prosperous future.’’ 2

A successful rebalance must underscore the strategic message 

that the policy represents an enduring U.S. commitment to the region, assuring our partners that we are in it for the long haul. This 

will require the full range of U.S. Government activities, not just 

those of the Defense Department. Military forces can be moved in 

and out in a relatively short period of time, but substantial, longterm U.S. investments in development, trade, and diplomacy are 

not as fungible and indicate a stronger, more comprehensive commitment to the region. But with implementation thus far uneven 

across the U.S. Government, the rebalance may well end up as less 

than the sum of its parts. 

RESOURCING OF THE REBALANCE

Effective implementation of the rebalance requires devoting resources concomitant with the task. When compared to other reVerDate Nov 24 2008 10:10 Apr 17, 2014 Jkt 000000 PO 00000 Frm 00014 Fmt 6633 Sfmt 6633 S:\FULL COMMITTEE\HEARING FILES\113TH CONGRESS, 2ND SESSION\TOPIC-ISSUE 
9 

gional bureaus, the State Department’s EAP Bureau is resourced 

well below levels appropriate for a region of its magnitude and 

importance to current and future U.S. economic and strategic 

interests. 

If the United States intends to increase its engagement and influence in the Asia-Pacific region, it will need to improve its efforts 

in a range of areas, including diplomatic engagement, public diplomacy, economic statecraft, development partnerships, partner capacity building, regional architecture, and civil society and human 

rights. 

Diplomatic Engagement 

Dollars spent are surely not the only way to judge the effectiveness of diplomacy in the 21st century, but budgets, not rhetoric, are 

a leading indicator of real commitment by a government. From this 

vantage point, the administration’s requested FY 2015 funding 

level for the Bureau of East Asian and Pacific Affairs (EAP) diplomatic engagement budget does not reflect the economic and strategic importance of its jurisdiction or the policy of rebalancing U.S. 

Government resources to the region. The FY 2015 budget request 

for EAP’s diplomatic engagement is the second-to-last of all 6 regional bureaus, or 8 percent of the total, despite the region’s 35 

countries accounting for nearly a third of both the world’s population and GDP. Furthermore, EAP bureau funding has decreased 

nearly 12 percent since its FY 2011 peak. 

Several U.S. civilian agencies have grown their foreign-deployed 

staff in East Asia. USAID has increased its personnel in East Asia 

from just 84 in September 2008 to 183 in June 2013. Over the 

same period, the Department of Treasury increased personnel from 

3 to 10, and the Department of Commerce from 78 to 91, though 

the Department of Agriculture decreased staff from 59 to 55. The 

proportion of these agencies’ total foreign-deployed staff based in 

East Asia varies nearly as widely as the absolute numbers. Those 

183 USAID employees account for only 11 percent of foreign-based 

USAID staff and Treasury’s East Asia-based employees account for 

just 17 percent of its staff abroad. Alternatively, the Departments 

of Commerce and Agriculture base a healthy 41 percent and 31 

percent of their foreign-deployed staff in East Asia, respectively. 

Given the range of U.S. interests and the variety of U.S. Government agencies with a footprint in the Asia-Pacific region, sufficiently addressing complex regional issues will require institutionalizing whole-of-government efforts and methods of information 

sharing. U.S. missions in Asia appear to have adopted such an approach toward commercial matters by establishing Interagency 

Commercial Task Forces, and there is great potential in applying 

this approach to regional goals. 

10 

Table 1. Regional Demographic and Economic Data and State 

Department Regional Bureau Resourcing 

(percent of world total) 

Rank 

Population 

of Region† GDP of Region*† 

Regional 

Two-way Trade 

With the U.S.*† 

FY 2015 

Budget 

Request for 

State Dept. 

Bureaus* 

FY 2015 

Budget 

Request 

for U.S. 

Assistance 

by Region* 

1 East Asia 

and Pacific 

2,250,795,287 

(33%).

Europe and 

Eurasia 

$29,723,060 

(46%).

Western 

Hemisphere 

$1,545,800 

(39%).

Near East $1,555.7 

(35%).

Near East $6,986.0 

(36%) 

2 South and 

Central Asia 

1,726,997,019 

(24%).

East Asia 

and Pacific 

$19,792,200 

(31%).

East Asia 

and Pacific 

$1,226,000 

(31%).

South and 

Central Asia 

$1,213 (27%).

Africa 

$6,934.8 (36%) 

3 Europe 

and Eurasia 

1,348,804,078 

(19%).

Western 

Hemisphere 

$7,729,000 

(12%).

Europe 

and Eurasia 

$813,800 (21%).

Europe 

and Eurasia 

$601.2 (14%).

South and 

Central Asia 

$2,959.2 (15%) 

4 Africa 

925,764,585 

(13%).

Near East 

$3,317,660 

(5%).

Near East 

$215,000 (5%).

Africa 

$379.9 (9%).

Western 

Hemisphere 

$1,326.7 (7%) 

5 Western 

Hemisphere 

633,071,719 

(8.7%).

South and 

Central Asia 

$2,580,791 

(4%).

Africa 

$91,650 (2%).

East Asia 

and Pacific 

$342.6 (8%).

East Asia 

and Pacific 

$810.7 (4%) 

6 Near East 

396,755,169 

(5%).

Africa 

$1,379,665 

(2%).

South and 

Central Asia 

$74,329 (2%).

Western 

Hemisphere 

$332 (8%).

Europe 

and Eurasia 

$492.3 (3%) 

* In millions of U.S. dollars. 

† 2013 

Source: CIA World Factbook; USTR; World Bank; U.S. Department of State 

More high-level travel to the region will also be required. The 

U.S. Trade Representative (USTR) travelled to East Asia just 8 

times during the Obama administration’s first term, compared to 

23 times and 18 times during the Bush administration’s first and 

second terms, respectively. And while President Obama and his 

other major cabinet officials have travelled to the region about as 

frequently as in past administrations (with the exception of former 

Secretary of State Clinton, whose travel schedule far surpassed her 

predecessors), more high-level engagement, especially with regional 

institutions, would send an important signal. 

11 

Table 2. EAP Foreign-Deployed Staff of Select U.S. Agencies 

U.S. Agency 

EAP-Based 

Foreign-Deployed 

Staff in 

September 2008 

EAP-Based 

Foreign-Deployed 

Staff in 

June 2013 

Percent of Total 

Foreign-Deployed 

Staff Based 

in EAP 

USAID ..................................................................... 84 183 11%

Treasury ................................................................. 2 9 16%

Commerce .............................................................. 70 79 36%

Agriculture ............................................................. 56 51 39%

Energy .................................................................... 4 6 26%

Source: Congressional Research Service 

Table 3. Number and Percent of Visits to East Asia-Pacific Region for the President 

and Heads of Civilian Agencies in Second Bush Administration and First Obama Administration 

Second Bush Administration First Obama Administration 

Number 

of Trips 

Percentage of 

Total Trips 

Number 

of Trips 

Percentage of 

Total Trips 

USAID ........................................................ 1 9% 3 12%

Treasury .................................................... 9 28% 9 32%

Commerce ................................................. 10 20% 11 48%

Agriculture ................................................ 4 31% 5 50%

Energy ....................................................... 3 9% 6 27%

USTR ......................................................... 18 36% 8 22%

State ......................................................... 28 11% 51 20%

President ................................................... 12 15% 10 24%

Source: Congressional Research Service 

Public Diplomacy 

Public diplomacy takes advantage of the United States’ greatest 

assets: our people and our values. When citizens of other countries 

develop scholarly, religious, civil society, and business connections 

with Americans from all walks of life, they learn who we are, what 

we stand for, and how we contribute to making the world a safer 

and more prosperous place. False stereotypes and generalizations 

fall by their own weight, replaced by a clearer understanding of 

what a diverse and vibrant nation the United States truly is. For 

Americans, these interpersonal connections foster a richer understanding of other nations’ histories, cultures, and languages. These 

insights inspired the Fulbright scholarships and the Peace Corps, 

amongst other pillars of American public diplomacy, and they 

should be an integral part of U.S. foreign policy as we move to 

build stronger ties to the Asia-Pacific. 

State Department funding for public diplomacy, which sponsors 

scholarships and grants such as the Fulbright Program, remained 

roughly flat from FY 2010 to FY 2013, and saw a modest increase 

in FY 2014, before plateauing again in the FY 2015 budget proposal. Furthermore, there was no significant increase in the number of Americans studying in Asia between academic years 2009- 

10 and 2011-12, and the same goes for the number of non-Chinese 

Asians studying in the United States. While Chinese students are 

flocking to U.S. schools in ever-greater numbers, the number of 

American students in China has not appreciably increased, despite 

12 

the 100,000 Strong Initiative (a program explicitly designed to get 

more American students to China) and the Chinese Government’s 

offer of 20,000 scholarships. To better develop the people-to-people 

connections so critical to U.S. interests and development, the administration must redouble its efforts to encourage more Americans 

to study in China and other countries of the Asia-Pacific region. In 

particular, more efforts need to focus on Southeast Asia; the number of U.S. students in Southeast Asia in academic year 2011-12 

was less than one-fifth of the total number in East Asia. 

Given the importance of the U.S.-Japan Alliance, the administration should also take steps to arrest the slide in the number of Japanese studying in America (from 42,215 in academic year 2004-5 

to 19,568 in 2012-13), which is due in part to an insular Japanese 

corporate culture that can underestimate the value of an American 

degree. The United States can mitigate this effect by promoting semester or year-long study abroad programs in the United States, 

offering more scholarships for advanced degrees, and supporting 

alumni networks for Japanese who have attended U.S. universities. 

For Southeast Asia, the administration’s FY 2015 budget request 

would fund a new Young South-East Asian Leaders Initiative academic exchange, as well as a Fulbright University in Vietnam. 

These programs reflect the need for a ‘‘rebalance within the rebalance’’ to Southeast Asia, and the administration should pursue this 

trend within other programs, agencies, and departments. 

But student exchange is just one way to promote interpersonal 

ties with the region. Other means include reducing travel restrictions and increasing visa issuance (such as the 36 percent increase 

from FY 2011 to FY 2012 in non-immigrant visas issued to Chinese 

citizens) to promote short-term stints in multi-national companies, 

professional conferences, joint entrepreneurial initiatives and research ventures, as well as expanding opportunities for exchanges 

throughout the U.S. Government, including at the state and local 

level. 

Efforts to improve public diplomacy will also require more personnel and better coordination. While the administration’s FY 2015 

budget request seeks to create three new public diplomacy positions to support the rebalance, effectively communicating the policy 

will require far more resources. In addition, the State Department 

should take steps to better integrate EAP’s public diplomacy efforts 

with those of other department bureaus and U.S. civilian agencies. 

At a wider aperture, the United States Government needs to better calibrate its messaging of the rebalance to the American public 

and the world at large. While broad policy speeches and pronouncements are useful to set a positive vision, if unsupported by hard 

deliverables, they risk creating a gap between expectations and reality. The administration would do better to return to its earlier 

messaging strategy of the rebalance, which was to under-promise 

and over-deliver. Bureaucracies can be slow to implement policy, 

and the administration must be careful not to let its rhetoric get 

too far in front of the facts on the ground. 

13 

3 United States Senate Committee on Foreign Relations, ′′Senator John Kerry’s Opening Statement at Nomination Hearing to be U.S. Secretary of State,′′ January 2013, http:// 

www.foreign.senate.gov/press/chair/release/senator-john-kerrys-opening-statement-at-nomination-hearing-to-be-us-secretary-of-state-. 4 International Monetary Fund, ‘‘World Economic Outlook Database,’’ October 2013, https:// 

www.imf.org/external/pubs/ft/weo/2013/02/weodata/index.aspx 

Table 4. East Asia-Pacific Region Students Studying in the United States and U.S. 

Students Studying in East-Asia Pacific Region 

Foreign Students Studying in the U.S. U.S. Students Studying Abroad 

2009/10 2012/13 

Percent 

Change 2009/10 2011/12 

Percent 

Change 

Total ........................................... 299,008 408,251 37% 39,499 41,722 6% 

China ..................................... 127,628 244,156 75% 13,910 16,365 18% 

Japan ..................................... 24,842 19,568 –21% 6,166 5,283 –14% 

South Korea ........................... 72,153 70,627 –2% 2,137 2,695 26% 

Taiwan ................................... 26,685 21,867 –18% 850 820 –4% 

Indonesia ............................... 6,943 7,670 10% 221 369 67% 

Malaysia ................................ 6,190 6,791 9% 125 176 41% 

Myanmar ................................ 695 955 37% 18 3 –83% 

Philippines ............................. 3,815 3,215 –15% 238 273 15% 

Singapore .............................. 4,051 4,558 13% 841 1,130 34% 

Thailand ................................ 8,531 7,314 –15% 1,231 1,437 17% 

Vietnam ................................. 13,112 16,098 23% 686 878 28% 

Australia ................................ 3,296 4,121 25% 9,962 9,324 6% 

New Zealand ......................... 1,103 1,311 31% 3,113 2,969 –5% 

Source: Institute of International Education 

Economic Statecraft 

As Secretary Kerry has stated, ‘‘foreign policy is economic policy,’’3 and economic statecraft presents the best opportunity for the 

United States to deepen its relationships with the fastest-growing 

economic region in the world.4 The administration is pursuing a 

two-pronged strategy of using U.S. foreign policy to support the 

growth of the U.S. economy, also known as commercial diplomacy, 

while using economic engagement to support foreign policy priorities. 

Developing and implementing a long-term strategy that combines 

commercial diplomacy and economic engagement is a complex undertaking and may not receive the attention it deserves from officials who are often rushing to put out the latest fire. The Department of State should therefore create more capacity for strategic 

thinking on commercial diplomacy and economic engagement by 

creating a new East Asia-Pacific office in the Bureau of Economic 

and Business Affairs. The Bureau of Democracy, Human Rights, 

and Labor took a similar step in 2013. The Department of State 

should also expand EAP’s Office of Economic Policy, which has 

been understaffed and unable to fulfill its growing responsibilities 

effectively. 

Reaping the benefits of increased U.S. trade and investment in 

the Asia-Pacific region will also require an associated increase in 

resources and personnel, especially if unprecedented regional trade 

deals like the Trans-Pacific Partnership (TPP) are to be properly 

implemented and made use of by U.S. businesses. While the Department of Commerce is exploring the addition of new Foreign 

14 

5Office of the United States Trade Representative, ′′The Trans-Pacific Partnership: Economic 

Benefits,′′ December 2013, http://www.ustr.gov/about-us/press-office/fact-sheets/2013/December/ 

TPP-Economic-Benefits. 

Commercial Service (FCS) officers to the region, increased staffing 

levels should coincide with reintegration of FCS officers into the 

State Department, which would improve the coordination of commercial diplomacy. 

While the USTR has a critically important and ever-expanding 

portfolio in the region, it currently lacks the funding and personnel 

to meet current demands, much less future challenges and opportunities. Beyond the TPP, USTR is also conducting Trade and Investment Framework Agreement (TIFA) consultations with Taiwan and 

Bilateral Investment Treaty negotiations with China and India, as 

well as expanded engagement with ASEAN. As these agreements 

come online, USTR will require more funding for personnel and 

travel to protect U.S. economic interests by ensuring proper implementation. 

The administration has made the TPP the principal focus of U.S. 

trade policy in the region and a cornerstone of the rebalance. The 

TPP aims to create a new high standard of rules-based trade in the 

region that is open to all members of APEC (and possibly all 

ASEAN members in the future). In November 2012, the administration launched the U.S.-ASEAN Expanded Economic Engagement 

(E3) Initiative, which builds on an older agreement and aims to 

help non-TPP ASEAN members to meet the standards that would 

qualify them for TPP membership. The initiative focuses on limited 

aims such as streamlining customs procedures and developing principles in areas like investment and communications technology. 

Some ASEAN members have expressed fears that the TPP could 

undermine efforts to build greater cohesion in their group and 

point to the Regional Comprehensive Economic Partnership 

(RCEP) as a more inclusive alternative. But it is not an either-or 

choice: the agreements are not mutually exclusive and seven APEC 

members already belong to both. 

Given the critical importance to U.S. interests of trade and economic engagement with the region, a high-standard TPP will be 

necessary to protect U.S. businesses from unfair business practices 

and allow them to leverage their competitive advantages. The TPP 

offers them considerable opportunities, especially with the addition 

of new members like Japan and the prospect that Korea and other 

significant economies are seriously contemplating joining the next 

round. According to the USTR, as currently configured the TPP 

agreement would cover 37 percent of all U.S. exports and include 

foreign markets that support 4 million jobs in the United States.5

A completed and successfully implemented TPP deal could therefore be a boon for U.S. exporters and help the administration 

achieve its National Export Initiative (NEI) goals of doubling exports and supporting two million American jobs. As part of that effort, the administration announced in October 2013 plans to enhance the SelectUSA program, which promotes investment into the 

United States, by making investment promotion part of the portfolio of U.S. ambassadors and their embassy staff. Such efforts will 

be critical to increasing investments by Asia-Pacific companies in 

15 

6Organization for International Investment, ‘‘Insourcing Fact,’’ August 2012, http:// 

www.ofii.org/resources/insourcing-facts. The jobs figure is an estimate based on Asia’s share of 

overall inbound FDI to the United States. 

the United States, which already total over $400 billion and directly employ over 900,000 Americans.6

Table 5. U.S. Trade Promotion Agencies Activity in Asia-Pacific 1 4

Millions of U.S. Dollars 

Agency FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 

Ex-Im Bank 

Authorizations ............................... $1,841.6 $3,987.4 $2,340.7 $7,057.7 $6,945.8 $7,078.9 

% Worldwide ............................ 12.8% 19.0% 9.6% 21.6% 19.4% 25.9% 

% Change from Previous Year — 116.5% –41.3% 201.5% 1.6% –1.9% 

Exposure ........................................ $16,163.0 $18,554.2 $17,183.0 $21,270.3 $25,463.2 $29,820.3 

% Worldwide ............................ 27.6% 27.3% 22.8% 23.9% 23.9% 26.2% 

% Change from Previous Year — 14.8% -7.4% 23.8% 19.7% 17.1% 

OPIC 2

Commitments ................................ $61.0 $110.0 $245.0 $948.0 $539.0 $528.0 

% Worldwide ............................ 4.6% 3.2% 9.7% 34.6% 14.8% 13.4% 

% Change from Previous Year — 80.3% 122.7% 286.9% –43.1% –2.0% 

Exposure ........................................ $1,096.0 $1,135.0 $1,216.0 $2,019.0 $2,404.0 $2,694.0 

% Worldwide ............................ 9.7% 8.5% 8.7% 14.0% 14.7% 14.9% 

% Change from Previous Year — 3.6% 7.1% 66.0% 19.1% 12.1% 

TDA 3

Funding ......................................... $14.6 $12.1 $13.5 $14.8 $13.6 $17.1 

% Worldwide ............................ 31.5% 28.3% 27.2% 36.0% 30.9% 41.2% 

% Change from Previous Year — –17.4% 11.2% 10.0% –8.3% 25.8% 

Source: Ex-Im Bank and TDA data from respective agencies’ annual reports. 

OPIC data based on OPIC-shared data. 

Notes: 

1 The countries included here as part of the Asia-Pacific region generally are: Australia, Cambodia, China, East Timor, 

Hong Kong, India, Indonesia, Japan, Malaysia, Marshall Islands, Mongolia, New Zealand, Palau, Philippines, Singapore, South 

Korea, Taiwan, Thailand, and Vietnam. 2 In the case of OPIC, commitments data are for Asia and exposure data are for the Asia-Pacific (based on OPIC definitions of East Asia and South Asia), and may include countries beyond those included in the general Asia-Pacific definition 

here. 3 U.S. trade promotion agency activity may include support for regional multi-country projects. 

4 In some cases, a regional project may support activity in a country outside of what is defined generally as the Asia-Pacific region here. 

Federal financing agencies are also a key pillar of U.S. economic 

statecraft, and have increasingly directed their resources toward 

the Asia-Pacific region over the past several years. Between 

FY 2008 and FY 2013, Export-Import (Ex-Im) Bank’s total exposure 

in the Asia-Pacific grew by over $14 billion, while the region’s 

share of worldwide exposure dropped 1.4% during the same period. 

The Overseas Private Investment Corporation’s (OPIC) exposure in 

the Asia-Pacific region grew from a little over $1 billion in FY 2008 

to nearly $2.7 billion in FY2013, accounting for almost 15% of 

OPIC’s total worldwide exposure. In FY 2013, over 41% of the 

Trade and Development Agency’s (TDA) spending went to the AsiaPacific region. TDA spent over $7.5 million on programming in 

East Asia and over $9.7 million in South and Southeast Asia, including feasibility projects in Indonesia and Vietnam under the 

U.S.-Asia Pacific Comprehensive Partnership for Sustainable Energy, an initiative that came out of U.S. participation in the East 

Asia Summit. 

16 

Note that Ex-Im Bank and OPIC are ‘‘demand-driven’’ federal 

agencies. U.S. businesses use their resources only when commercial 

incentives are sufficient. While it is no surprise that Ex-Im and 

OPIC have increased their engagement in the Asia-Pacific region 

to such a degree, it is disappointing that ‘‘supply-driven’’ federal 

agencies have not followed suit, especially when a virtuous circle 

of investment, trade, and prosperity is the likely result. 

Development Partnerships 

Development partnerships are a critical pillar of U.S. economic 

statecraft and foreign policy. U.S. development partnerships support the markets, infrastructure, and rule of law necessary to attract and sustain U.S. businesses, all while fortifying bilateral relationships important to other U.S. interests and values. 

As a result of the renewed focus on Asia and the number of nations in the region who are eligible for and could benefit from enhanced development partnerships, funding levels should be increasing significantly. Unfortunately, USAID budgets neither reflect the 

importance of the region nor comport with the stated goals of the 

rebalance policy. The FY 2015 budget request for U.S. development 

funding to the region is merely a return to FY 2010 levels, even 

while USAID staff numbers have increased 65 percent and new 

missions have been established in Burma and Papua New Guinea. 

In fact, compared to the FY 2011 spending levels, only Foreign Military Financing (FMF) saw significant increases through FY 2014 

(and even within that program the amount of funds going to EAP 

in 2014 was lower than those earmarked for Europe and Eurasia). 

Furthermore, U.S. development funding to the Asia-Pacific region 

ranks fifth out of six, surpassing only Europe and Eurasia. The resources we devote to a region speak to the level of our commitment, 

and the administration should increase its budget request for development funding to the Asia-Pacific region. 

In allocating resources for the rebalance, it is not good enough 

to merely reshuffle from within and across the Asia-Pacific budget 

allocation; new money must also be brought to the table to reflect 

the strategic priority of the rebalance. Given other important national security priorities, the rebalance cannot be built by raiding 

other ‘‘Function 150’’ International Affairs accounts, either, but 

should be funded with genuinely ‘‘new’’ money. For example, the 

Lower Mekong Initiative (LMI), a post-rebalance development program, aims to improve education, the environment, infrastructure, 

and women’s rights in Cambodia, Laos, Thailand, and Vietnam. 

The administration’s initial LMI proposals to Congress in 2013 

were in the form of reprogramming from other EAP accounts. 

While not exactly robbing Phan to pay Phung, this budgetary maneuver did not provide the region the boost it deserves. At Congressional insistence, the Department of State was able to develop 

genuinely new funding sources for the LMI, thus increasing capacity in the Asia-Pacific region and not merely engaging in budgetary 

sleight of hand. 

Furthermore, EAP appointed only two nonpermanent staff members to manage the LMI, which is insufficient to oversee the program’s complicated interagency activities and $140 million in anVerDate Nov 24 2008 10:10 Apr 17, 2014 Jkt 000000 PO 00000 Frm 00022 Fmt 6633 Sfmt 6633 S:\FULL COMMITTEE\HEARING FILES\113TH CONGRESS, 2ND SESSION\TOPIC-ISSUE 
17 

7 U.S. Department of State, ‘‘Lower Mekong Initiative FAQs,’’ accessed January 02, 2014, 

http://www.state.gov/p/eap/mekong/faq/index.htm 8Ministry of Foreign Affairs of Japan, ‘‘ODA by Region—East Asia,’’ November 15, 2013, 

http://www.mofa.go.jp/policy/oda/page_000008.html 9 Charles Wolf, Jr., Xiao Wang, Eric Warner, ‘‘China’s Foreign Aid and Government-Sponsored 

Investment Activities,’’ RAND Corporation, 2013. 

nual U.S. spending7 (which is still dwarfed by Japan’s $362 million 

in grants and technical assistance to the LMI countries in 2011).8

Nonetheless, the LMI presents a smart and effective model for 

using our limited development dollars, and the State Department 

should formulate a plan to institutionalize the successes of the initiative and approach future LMI engagement, perhaps in cooperation with China. The U.S. Government should also look at other aspects of our development funding that can support ASEAN 

connectivity. 

Given our relatively low levels of development funding to the region, it is critical that the U.S. Government increase coordination 

within the activities of our trade and investment promotion agencies and aggressively pursue more public-private partnerships. For 

the latter, the U.S. Government should review and streamline the 

process for establishing partnerships. Recognizing the currently 

constrained budget environment in the United States, the administration should also explore greater donor coordination with our allies in Europe and East Asia, expanding overall foreign assistance 

and utilizing economies of scale. Australia and Japan could be particularly helpful, given their location and strong economic ties with 

other countries in the region. Such efforts should not preclude the 

administration from requesting and reallocating additional development funding to the Asia-Pacific, where China alone pledged $107 

billion in aid in 2011, up from $16 million in 2001.9 Given its tremendous level of participation in the region, the United States 

should also explore donor coordination opportunities with China. 

Finally, as Congress works with the administration to review the 

FY 2015 budgetary proposals for the rebalance, both will need to 

show genuine support to increase resources for the region. This 

means not just reprioritizing within it, as perhaps reflected in the 

large plus up for Burma programs—certainly a worthy endeavor— 

but with funding flat or declining for other regional priorities elsewhere. 

Regional Architecture 

In addition to developing a shared architecture and approach to 

address maritime security issues, the countries of the Asia-Pacific 

face a host of common challenges, including climate change, 

transnational crime, infectious disease, and human trafficking. 

These are regional problems that require a regional approach. Climate change in particular appears set to pose major challenges for 

the Asia-Pacific region in the years and decades to come—including 

as a driver for related security issues such as migration, food and 

water security, and infectious diseases. These challenges demand a 

concerted and coordinate response. Multilateral institutions provide 

an effective platform for the development of new methods, the 

sharing of best practices, and the collective implementation of solutions. Importantly, they also offer a forum for the management and 

resolution of disputes. 

18 

10 U.S. Department of State, ‘‘21st Annual APEC Economic Leaders’ Meeting Fact Sheet,’’ October 8, 2013, http://www.state.gov/r/pa/prs/ps/2013/10/215195.htm 

The administration has taken several steps to enhance U.S. participation in regional institutions, such as creating within the EAP 

Bureau a new Deputy Assistant Secretary of State for Multilateral 

Affairs and a new U.S. Ambassador to ASEAN. The administration 

also signed ASEAN’s Treaty of Amity and Cooperation and raising 

participation in the East Asia Summit (EAS) to the head of state 

level and the ASEAN Regional Forum to the Secretary of State 

level. Then Secretary of State Hillary Clinton also attended the Pacific Islands Forum (PIF) in 2012, marking the highest level of U.S. 

participation ever. These efforts have increased the U.S. profile in 

the region and yielded positive, tangible results for U.S. interests 

and values. The United States can continue to demonstrate its reliability by increasing its level and tempo of engagement with the region’s multilateral institutions, without allowing other crises to distract from the important work of improving and expanding our relationships within the region. 

The United States already pursues several initiatives in cooperation with Asian multilateral institutions, including public health 

and energy issues through the LMI, trade and investment through 

APEC (whose 21 member economies account for approximately 55 

percent of global GDP),10 economic growth and climate change 

through ASEAN, and transnational crime and clean energy 

through the East Asia Summit (EAS). On energy, the U.S. Embassy in Bangkok established an Asia-Pacific Clean Energy Program, staffed by officials from the Trade Development Agency 

(TDA), State Department, and OPIC. The initiatives recently proposed at the APEC forum, such as a proposed fund to improve supply chain connectivity and the creation of an Anti-Corruption and 

Transparency Working Group, are also good examples of programs 

that combine staff from across U.S. Government agencies. In addition, there are increasing signs that the region is starting to organize itself diplomatically around the areas of humanitarian assistance, disaster relief and search and rescue (as demonstrated in the 

recent case of the missing Malaysia Airlines flight MH370). The 

United States is second to none in these areas and should take a 

leading role in developing regional response mechanisms. 

The United States should also begin to develop more multilateral 

structures among allies and partners around shared issues of concern, including common environmental and security threats. Furthermore, the United States can leverage the convergence of India’s 

‘‘Look East’’ strategy with our own rebalance strategy to increase 

joint U.S.-India cooperation with ASEAN and other allies and partners. For example, a U.S.-India-Japan trilateral could be very effective at addressing a range of regional issues. In addition, the 

United States should ensure that Taiwan is included in all appropriate regional architectures and institution building efforts. 

The speed with which the Asia-Pacific’s regional architecture is 

expanding and the growing set of critical issues that it is needed 

to address demands greater U.S. engagement. In particular, regional institutions can play a key role in the resolution and management of contentious maritime issues, a critical area of friction 

19 

in the region and an area where the United States can contribute 

substantial technical expertise. While our bilateral alliances and 

partnerships underpin our engagement with the region, the U.S. 

Government could better realize its policy goals by working more 

through regional institutions like ASEAN and EAS, and the United 

States should devote more diplomatic support and resources for the 

development of regional institutions to address maritime security 

issues. 

Partner Capacity Building 

An oft-stated element of the rebalance is the strengthening and 

modernizing of U.S. bilateral alliances and developing deeper cooperation with emerging partners. These approaches allow the 

United States to leverage existing and potential partner networks 

to address issues in a far more cost-effective and impactful way 

than going at it alone. 

Although our bilateral alliances remain at the heart of U.S. 

strategy and policy in the Asia-Pacific region, including the rebalance, the United States has the opportunity to supplement a ‘‘huband-spokes’’ model with a more network-centric approach in the region, knitting together alliances and partnerships to efficiently leverage complementary capacities in addressing common challenges. 

Such an approach could involve helping regional partners and allies to more efficiently allocate resources, coordinate, and cooperate 

in areas of regional importance, such as maritime security and natural resource exploitation. The United States can play an important role in helping build a web of relationships throughout the region to bring about more effective security cooperation, allowing for 

greater coordination and the efficient application of allies’ and partners’ comparative advantages. 

For example, discussions on common maritime domain awareness can benefit from the participation of the United States. The 

initiation in September 2013 of official consultations on a code of 

conduct to govern behavior in the South China Sea provides an opportunity to improve and leverage the capacity of our allies and 

partners, while simultaneously defusing a potential conflict environment. In addition, the State Department’s recent announcement 

of $32.5 million in regional and bilateral maritime assistance—including up to $18 million to improve Vietnam’s coastal patrol 

units—will go some way toward upgrading partner capacity. Further policy options to improve the maritime domain awareness, defense and law enforcement capabilities of partners and allies 

should be considered. For example, both New Zealand and Japan 

are interested in improving their amphibious capabilities. South 

Korea and Singapore have expressed interest in Global Hawk unmanned aerial vehicles. Indonesia, with over 17,500 islands and piracy problems, needs more advanced airlift and logistics capabilities. While considering ways to improve our allies’ and partners’ 

maritime capabilities, the U.S. Government should simultaneously 

work to facilitate greater regional coordination on maritime security issues. One concrete, low-cost way to promote that effort is to 

offer excess U.S. frigates to partner states in the region, bolstering 

their maritime capabilities. 

20 

But U.S. efforts must also go beyond defense and intelligence 

issues to include improving partner capacity for interagency coordination, trade enforcement (where the TPP is a welcome development) and rule of law. On rule of law, the United States can provide unmatched legal, technical, and infrastructure support to 

countries improving their judicial systems. The Support for Trade 

Acceleration (STAR) program, which brought legal experts to Vietnam to help draft commercial laws, could be a model for other 

emerging partners in the region. Bolstering the rule of law can 

help pave the way for future trade agreements based on clear rules 

and strong protections for intellectual property rights. Importantly, 

rule of law assistance provides an essential avenue for improving 

a country’s human rights record, which is a core U.S. value and in 

some instances a barrier to further U.S. economic engagement. The 

U.S. Government should expand across-the-board coordination with 

capable allies and regional institutions on this issue and increase 

rule of law assistance that targets both single-country and multilateral issues. 

Civil Society and Human Rights 

The economic imperatives of the rebalance coexist with the need 

for progress on human rights, especially as the United States engages with emerging partners in the Asia-Pacific. We can use the 

benefits of economic partnership to influence countries with weak 

records on human rights and democratic governance; through incremental engagement with those countries that seek to improve 

their records, we can incentivize specific improvements with the 

promise of a closer economic relationship. We can also help countries realize that the failure to provide basic rights can undermine 

economic development, especially when it comes to media and 

internet freedom, two areas where the United States leads and development efforts could be expanded. U.S. development programs 

that strengthen the rule of law, maritime enforcement, and public 

diplomacy are complementary to the goal of promoting human 

rights in the region and should be expanded wherever possible. In 

addition, the United States can use aspects of military-to-military 

relationship building to improve other countries’ human rights 

practices. 

The United States faces several new and challenging questions 

when balancing human rights and democracy goals among other 

U.S. objectives in the Asia-Pacific: How should human rights and 

democracy promotion fit into the U.S.-China relationship? How will 

the United States effectively promote human rights and democracy 

in Burma as the country implements broad political reforms? How 

will the United States respond to democratic developments, for 

good and bad, in countries such as Cambodia and Thailand? How 

can the United States best promote human rights and democracy 

in Vietnam as that important bilateral relationship continues to develop? 

In FY 2014, the State Department requested an additional 30 

percent in funding ($98.6 million) for ‘‘Governing Justly and Democratically’’ programs in the EAP region over the FY 2012 level, and 

the EAP Bureau receives the largest amount of Democracy, Human 

Rights, and Labor (DRL) funding among the U.S. foreign aid reVerDate Nov 24 2008 10:10 Apr 17, 2014 Jkt 000000 PO 00000 Frm 00026 Fmt 6633 Sfmt 6633 S:\FULL COMMITTEE\HEARING FILES\113TH CONGRESS, 2ND SESSION\TOPIC-ISSUE 
21 

11The White House, ‘‘Remarks by Vice President Joe Biden on U.S.-Korea Relations and the 

Asia-Pacific,’’ December 2013, http://www.whitehouse.gov/the-press-office/2013/12/06/remarksvice-president-joe-biden-us-korea-relations-and-asia-pacific. 

gions. The committee supported this request, as increased funding 

is required to expand programs in Burma, Indonesia, and Vietnam, 

among others. Furthermore, the DRL Bureau created an East Asia 

and Pacific office in 2013, whereas previously the Asia portfolio 

was handled by multiple offices. Other functional Bureaus within 

the State Department should implement similar reorganizations 

where feasible. 

Finally, the United States should increase support for institutions such as the Asia Foundation, the Fulbright Program, and the 

East-West Center. It should also encourage greater attention and 

focus on Asia-Pacific programming at the United States Institute 

of Peace. These institutions help to both build local human capacity 

and also develop a cohort of U.S. Government personnel and private citizens with strong expertise in Asia and the ability and ambition to advance U.S. values and interests in the region. Unfortunately, in its FY 2015 budget, the administration requested cuts in 

allocations to the Asia Foundation and the East-West Center by 29 

percent and 35 percent, respectively. These institutions offer a 

large potential return on investment and play unique roles in the 

region, and cutting their budgets hardly reflects positively on the 

administration’s level of commitment to the rebalance. 

CHINA AND THE REBALANCE

While the rebalance should not be seen as a reaction to China’s 

changing role in the region, clearly its rise, and uncertainties about 

its future trajectory, are important contextual elements for understanding the strategy. While in Seoul, Vice President Biden said 

that, ‘‘We’re also working to get our relationships with China right, 

with the right standards. It’s not only in our interest, it’s in the 

interest of the region, the interest of the world that we get that relationship right with China.’’ 11 And for the United States to ‘‘get 

China right,’’ we must at the same time ‘‘get the region right’’ as 

well, through a properly resourced and successfully implemented 

rebalance. A signal measure of the success of the rebalance will be 

its ability to shape and support the emergence of a regional order 

and architecture that facilitates the rise of a China that adheres 

to the ‘‘rules of the road’’ and contributes to regional and global stability, security and prosperity. 

Policy-makers should also be aware that excluding China from 

the conversation around the rebalance will jeopardize both the 

goals of the policy and the health of the bilateral relationship. 

While China will of course make its own choices about its role and 

future in the region, the inclusion and participation of a China that 

chooses to play a positive and productive role should be welcomed, 

especially when it comes to regional institutions and trade liberalization. China is the region’s largest economy and many of its 

neighbors see economic relations as the foundation for their strategic relations. Boosting our trade and diplomatic relationships in 

the region therefore requires increased and positive engagement 

with China. 

22 

But the United States must walk the fine line of continuing to 

improve trade relations with China while simultaneously pushing 

back against unfair practices, including subsidies and both cyberenabled and ‘‘traditional’’ theft of intellectual property. Some of 

these issues can be addressed in the Bilateral Investment Treaty 

(BIT) that China and the United States restarted negotiations on 

in July 2013, but most cannot wait for BIT negotiations to conclude 

before action is taken. In addition, China appears to have eased its 

stance on the TPP, which has strong standards on industrial subsidies and intellectual property protection, and has adopted a more 

positive tone toward joining in as a long-term goal. 

To capitalize on recent developments, the U.S. Government 

should accelerate BIT negotiations with China and emphasize that 

the TPP is an open agreement that welcomes newcomers, including 

China. Stronger economic relations will reinforce mutual strategic 

goals like the denuclearization of the Korean Peninsula and the 

peaceful resolution of maritime disputes. There is significant potential in cooperative work with China to develop reliable mechanisms 

within regional institutions to resolve disputes early on. In addition, increasing donor coordination with China holds great promise 

for improving human welfare in the region. 

Enhancing our interaction with China on these issues is vital to 

our national security interests and requires heightened levels of civilian resources. Alternatively, a failure to adequately apportion civilian resources risks stagnation of our economic and strategic objectives. Even worse, a lopsided rebalance that appears to focus 

mostly on military resources could produce a counterproductive response from China. Uneven implementation of the rebalance also 

risks creating the perception among other countries in the region 

that a fault line has been drawn between the United States and 

China and that they must pick a side. In reality, expanding and 

improving economic and strategic relations with both China and 

the United States is not a mutually exclusive endeavor, and the 

choice is not between the United States and China, but rather between support for a region with strong institutions, norms of behavior, and respect for international law versus a region of 

revanchism, aggression, and conflict. U.S. policy-makers must ensure this message is understood by China and the region; successful implementation of the rebalance requires nothing less. 

A major challenge for the rebalance is to bring China into the 

process of updating and strengthening existing international rules 

and norms. At the same time, the United States must remain vigilant in standing up to challenges to its interests, values, and allies. 

Strengthening rules and norms in Asia is a fundamental U.S. interest, and realizing this goal will require persistent engagement. 

In particular, U.S. engagement must focus on encouraging China 

to adopt and adhere to rules and norms and play a productive role 

in the regional institutions that develop and enforce them. Ultimately, the benefits that China will inevitably experience from 

playing a positive role within regional institutions and abiding by 

regional norms can help inform its behavior on the international 

stage. 

23 

IMPLEMENTATION OF THE REBALANCE

The Senate Foreign Relations Committee has a duty and responsibility to ensure that resources are allocated efficiently, effectively 

and appropriately across all U.S. foreign policy priorities, and to 

promote the time, attention and focus needed by the U.S. Government on critical but under-resourced areas of U.S. foreign and national security policy, including, first and foremost, Western Hemisphere affairs and the need for additional emphasis on economic 

statecraft in the Western Hemisphere. While due to the nature of 

the committee’s jurisdiction in the Senate this report does not go 

into detail on further developing our military alliances in the region, it encourages continued progress in upgrading our alliances 

with Japan, the Republic of Korea, Australia, Thailand, and the 

Philippines. The report also recognizes that the rebalance policy 

necessarily starts with our alliances and that renewing and refurbishing those alliances to meet the challenges of the 21st century 

must be a cornerstone of U.S. policy in the region. 

The unique insight of the rebalance is its integrated approach to 

the Asia-Pacific region. The strategy sees the whole as greater than 

the sum of its parts, and a similar approach toward the allocation 

and coordination of U.S. Government resources will be required to 

effectively implement the rebalance. Namely, the rebalance calls 

for a new posture of U.S. Government military and civilian resources in the Asia-Pacific region. While this report touches only on 

the latter side, it is critical that U.S. military efforts to enhance regional security are closely coordinated with diplomatic initiatives to 

strengthen regional institutions and economic programs to improve 

regional growth. Otherwise, haphazard or improperly calibrated 

implementation of the rebalance strategy could create several potential negative outcomes and consequences. At the same time, policy makers must be aware that barriers to implementation will require sustained political will to overcome. 

First, an effort that is too fast or too heavy handed could hamper 

U.S. Government operational efficiency. While the implementation 

of the civilian side of the rebalance may be lagging behind the military side, policy-makers should not rush haphazardly to make up 

the difference. Haste makes waste, and while there should be 

short-term indications that a shift is taking place, the rebalance is 

a long-term endeavor requiring deliberate and well-conceived implementation. 

Second, policy makers should look closely at the proportion of resources devoted to Southeast Asia within the context of the rebalance. The distribution of personnel and resources should be determined by where they can have the most impact on developments 

of importance to the United States, not by the largest economies 

or most headline-grabbing issues. To that end, more attention 

should be paid to the countries of Southeast Asia, where U.S. influence has the potential to play a defining role in the economic development and geopolitical orientation of our emerging partners. 

Third, Congress has an important role to play in avoiding negative outcomes that might result from too few resources devoted to 

the rebalance. Congress holds the power of the purse and, as the 

saying goes, it takes money to make money. Appropriators need to 

24 

recognize that increased U.S. engagement in the Asia-Pacific must 

go well beyond more warships and submarines; we will need significantly more diplomats, commercial officers, and technical experts in the region to allow U.S. businesses to take full advantage 

of the myriad economic opportunities. 

Finally, the U.S. Government must ensure that the military and 

non-military aspects of the rebalance are coordinated and complementary. Each element of the rebalance policy should reinforce 

the other elements, building upon previous activity while laying a 

foundation for future engagement. As a regional strategy, the rebalance cuts across a spectrum of U.S. interests, requiring intensive coordination across the whole of government; it will not be 

enough for the left hand to simply know what the right hand is 

doing—they must work in synch. 

Barriers will inevitably arise when putting a major policy initiative like the rebalance into practice, and variance in implementing 

the policy across its many dimensions is expected. While a de facto 

shift in civilian resources was already underway during the last 

several years of the George W. Bush administration, those efforts 

were modest in scope and do not justify the recent lack of movement in the civilian sphere. A few possible explanations are bureaucratic inertia, budgetary constraints, and resource development. 

Large bureaucracies are not celebrated for their ability to change 

course quickly. In the case of the rebalance, government employees 

whose work focuses on other regions might feel their interests 

threatened by a proposed shift of resources to the Asia-Pacific. 

Such shifts must take place within the context of a broader global 

strategy, and the standard policymaking process is insufficient to 

bring about the movement in resources that the rebalance requires. 

More high-level directives tying budgets to strategy—such as the 

2012 joint memo from the National Security Council and Office of 

Management and Budget advising departments to make Asia a priority in the FY 2014 budget—may be necessary. Overcoming bureaucratic inertia will require substantial and sustained political 

will. 

Greater coordination is also required among U.S. Government 

agencies to properly ‘‘rebalance the rebalance.’’ While some agencies are more involved in the region than others, either due to differing priorities or budget constraints, more effective inter-agency 

coordination would make for more effective use of the resources already deployed. Stove-piping, an anathema for information-sharing, 

and turf battles have long plagued large bureaucracies, and an undertaking as comprehensive as the rebalance will require overcoming old habits. 

Budgetary constraints present another significant barrier to effective implementation of the rebalance. Yet helping U.S. businesses take advantage of the rapidly expanding economic opportunities in the Asia-Pacific region will require significant and sustained investments by our government; to eschew those investments for the sake of reducing the non-defense national security 

budget by a few percentage points is the essence of ‘‘penny-wise 

and pound-foolish.’’ Fortunately, the military drawdowns from Iraq 

25 

12Pew Research Center, ‘‘America’s Place in the World 2013,’’ December 3, 2013, http:// 

www.people-press.org/files/legacy-pdf/12-3-13%20APW%20VI%20release.pdf 13The White House, ‘‘Remarks by President Obama to the Australian Parliament,’’ November 

17, 2011, http://www.whitehouse.gov/the-press-office/2011/11/17/remarks-president-obamaaustralian-parliament 

and Afghanistan make it possible to increase resources to the AsiaPacific without damaging our operations and interests elsewhere. 

Some of the civilian aspects of the rebalance will simply take 

time, regardless of the choices made by senior U.S. policy-makers. 

The hardware of civilian foreign policy, such as Embassies and 

USAID missions, can take several years to construct. The software 

of our efforts, including training in language and area skills, can 

take even longer to develop. The long lead times required to implement these initiatives underscore the need to get started as soon 

as possible. As Albert Einstein once pointed out, ‘‘nothing happens 

until something moves.’’ 

Finally, political leaders in the United States, especially the 

President and Members of Congress, must do more to make the 

case to the American people that the Asia-Pacific region deserves 

greater investment of government resources, and that increased 

international engagement will benefit Americans from all walks of 

life and all across the country. Sustained engagement in the region 

will require buy-in from the American people, so political leaders 

must raise the visibility of the region’s importance and our government’s role there in promoting economic growth and safeguarding 

American interests. In January 2011, 47 percent of Americans reported that Asia was the most important area for the U.S., but that 

number had fallen to 35 percent by November 2013—back to late 

2001 levels.12 Americans need to be told just how and why, in the 

words of President Obama, ‘‘Asia will largely define whether the 

century ahead will be marked by conflict or cooperation, needless 

suffering or human progress.’’ 13

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ACKNOWLEDGEMENTS

In drafting this report, the Congressional Research Service provided the committee with invaluable information and analysis including a September 2012 in-depth analysis of the degree to which 

selected civilian U.S. agencies have placed a greater emphasis on 

East Asia since 2009; and a second, 126-page analysis in December 

2012 of the broader question of the degree to which the Obama administration had implemented the civilian side of its rebalancing 

strategy. In the fall of 2013, CRS provided follow-up with an array 

of memos substantially updating the research they had performed 

the previous year. CRS analysts who provided support included: 

Mark Manyin, Specialist in Asian Affairs, coordinator; Ben Dolven, 

Specialist in Asian Affairs; Ian Fergusson, Specialist in International Trade and Finance; Charles E. Hanrahan, Senior Specialist in Agricultural Policy; Shayerah Ilias, Specialist in International Trade and Finance; Alan Kronstadt, Specialist in South 

Asian Affairs; Susan V. Lawrence, Specialist in Asian Affairs; 

Thomas Lum, Specialist in Asian Affairs; Michael Martin, Specialist in Asian Affairs; Wayne Morrison, Specialist in Asian Trade 

and Finance; Ian Rinehart, Analyst in Asian Affairs; Barbara L. 

Schwemle, Analyst in American National Government; Fred 

Sissine, Specialist in Energy Policy; Alex Tiersky, Analyst in Foreign Affairs; Bruce Vaughn, Specialist in Asian Affairs; Matthew 

Weed, Analyst in Foreign Policy Legislation; Martin Weiss, Specialist in International Trade and Finance; Mary Irace, Section Research Manager, International Trade and Finance Section; Julie 

Kim, Section Research Manager, Foreign Policy Management and 

Global Issues Section; Lisa Mages, Section Head, Foreign Affairs, 

Defense and Trade Section Knowledge Services Group; Michael 

Moodie, Assistant Director, Foreign Affairs, Defense and Trade Division; and, CRS Information Research Specialists Maureen 

Bearden, Carol Canada, Beth Cook, Susan Chesser, Nese 

DeBruyne, Mike Donnelly, Hannah Fischer, Michael Greene, 

George Mangan, Beth Roberts, Carolyn Smith, and Barbara 

Torreon. 

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