On Feb. 21, in Washington D.C., U.S. President Donald Trump sat down with Prime Minister of Japan Shigeru Ishiba. Their conversation was on how Tokyo could help the U.S. to unleash gas in Alaska and ship it to U.S. allies in Asia. Trump and his main energy advisor Doug Burgum put forth the venture as a way for Japan to replace their reliance on Middle Eastern energy and address their trade imbalance of the U.S. Premier Ishiba. The Japanese premier stated that he hopes that the $44 billion project will ensue.
The pitch taps into deep concerns amongst the Asian capitals about potential tariffs and security of sea lanes that carry their energy imports. These also touch upon Japan’s hope to halt any potential tariff that is placed on their country by the U.S. This plan revolves around the cost and logistical hurdles of Japan, South Korea and Taiwan. However, the plan is open to anyone who believes in increasing the U.S. gas imports broadly, and this could help bolster the American economy which would elevate the U.S to compete with China and Russia’s current economics.
“If the Trump administration were to have its way, U.S. LNG would flow in massive quantities to Japan and South Korea and then would flow downstream…so that Southeast Asia would become economically dependent on the United States,” Japan chair at Hudson Institute Kenneth Weinstein, Japan chair at Hudson Institute said. “It’s redrawing the map of energy dependence” Japan is key to the Trump administration’s energy plan. Currently, Japan is the world’s second largest LNG buyer, and a major player in energy infrastructure, and a trading hut with an excess that can help the U.S. gas markets in Southeast Asia.
The pitch is the creation of an 800-mile pipeline linking gas fields on Alaska’s North Slope to a major terminal on the Pacific coast. Geographic location also is one of the top reasons for the pitch. The U.S. argued that Japan has a needed interest since Alaska is closer geographically to Japa than the Middle East. The biggest part of their discussion was about the reduction of reliance on Russian gas. Though it is noted that Japan gets the majority of their LNG from Australia, which is around 40%, compared to 0.1% which it receives from the U.S. or Russia.
Energy security arguments are reaching the ears of others in Asia, especially with potential tariffs looming. India has seemed to have pledged. Taiwan as well is considering purchasing only U.S. purchases. However, if Taiwan takes this agreement, they may hinder the Chinese government from taking aggressive steps, such as naval blockades. South Korea says that their government is also considering Alaskan LNG, if certain policies are not enforced on them, such as tariffs.
However, there are strategic advantages for the U.S. and specifically the South Asian countries. By creating stronger alliances, countries that feel threatened by the ever growing power of China believe they have an ally and a spokesperson in the U.S. Also, they would be able to negotiate against potential tariffs, halting any hindrance to their economy. For the U.S., it creates a blockade against China’s influence and helps increase the U.S. economy by exporting fossil fuels. Either way, this is a strategic policy plan that would help create alliances, hinder potential tariffs and grow the U.S. economy.
