Donald Trump vs Xi Jinping: Who will win in battleground Asia?

In recent meetings in Thailand and Malaysia, traditional allies and diplomatic partners of the US, there was a sense of growing unease about where they countries stand with President Donald Trump.

Rumours of tension with Australia's Prime Minister Malcolm Turnbull during a phone call over whether the US would accept refugees made them wonder whether they should move closer to China's orbit or try to maintain traditional close relations with America. US Defense Secretary James "Mad Dog" Mattis' trip last week to South Korea and Japan to re-emphasize traditional military obligations in case of conflict over the Diaoyu Islands was not enough to quell unease.

As I wrote previously, Trump's dealings with Asia thus far with his unprecedented call with Taiwan's President Tsai Ing-wen as well as criticising China for unfair economic practices is brilliant as it reasserts American power in the region.

By being unpredictable and brash, it will help him negotiate better access to the Chinese market for American companies as long as he does not cross a red line – such as ending acknowledgement of the One-China Policy which would in all likelihood provoke an armed response by China.

This might help effect regime change in North Korea which is needed from a human rights perspective and to ensure peace on the Korean Peninsula. The One-China Policy requires countries seeking diplomatic relations with China to recognise it as one country despite there being two governments claiming to be separate states.

However, Trump needs to focus immediately on Asia in the coming weeks as he has personally said little publicly on the region since formally becoming president. In the meantime, China has looked to fill the power vacuum and position itself as the responsible and predictable superpower in the region.

Since Trump's inauguration, China has moved to shore up dominance by utilising a carrot and stick approach. President Xi Jinping emphasised free trade and responsible government during a speech at the World Economic Forum in Davos winning praise from corporate leaders. Support for free trade is critical as the vast majority of citizens in Asia support it. Billions of Asians have been raised out of poverty because of the creation of the World Trade Organization and other similar regional free-trade agreements.

China has also continued to dole out billions in loans and investments in Pakistan, the Philippines and Cambodia among other nations as part of President Xi's One Belt One Road Policy. In appreciation, Cambodia's long-serving Prime Minister Hun Sen even went so far as to ban Taiwanese and Tibetan flags this week. Filipino President Rodrigo Duterte has said that he will look to forge closer relations with China instead of the US and solve issues over the South China Sea amicably.

On the other hand, China has punished Mongolia by blocking commodity imports for welcoming the Dalai Lama. The Chinese government ordered South Korean conglomerate Lotte to halt construction of its $2.6bn (£2.8bn) theme park in north-eastern China to pressure South Korea to rethink deployment ofTerminal High Altitude Area Defense (THAAD) missile defence system. With a presidential election months away in South Korea, candidates such as Moon Jae-in are publicly stating they want to rethink deployment and might want to align closer with China.

Asian nations want predictability and stability in their relationships with America.

To ensure American power and counteract China's savvy moves, Trump needs to reiterate continued acknowledgement of the One-China Policy while continuing to criticising China for its internet policies, protectionism and continued reclamation of islands in the South China Sea. By doing so, he will let Asian nations know that he is not looking for war yet at the same time help open up the China market.

Right now, there are far too many limits in financial services, auto, and internet for non-Chinese firms. Trump can help represent other nations who are too small or scared of China to protest unfair trade practices. Only America, and to some extent Germany, can make a public stand like this against China and move the needle.

He also needs to appoint well-known Asia hands into the State Department as Deputy Secretary of State. Too many of his senior appointees so far have experience with Russia and the Middle East but too little with Asia. He needs to send a strong signal to Asia of his intentions by limiting the power of economic and China advisers such as Professor Peter Navarro, author of Death by China, who was appointed by Trump to be director of the National Trade Council.

By 2050, China's and India's economies most likely will have surpassed America's

Asian nations want predictability and stability in their relationships with America. Navarro especially is one who causes unease throughout the region — he has not visited mainland China in more than a decade and does not speak Mandarin. His criticisms about China keeping its currency artificially low and stealing American manufacturing jobs in light industry is outdated. If anything China is blocking capital outflows, raising interest rates in order to strengthen its currency, the Yuan. South-East Asian nations now are exporting to China as that economy transitions to one based on consumption.

The reality is most low-end manufacturing has already moved out of China to countries like Vietnam, Indonesia and Sri Lanka. Officials in those nations are worried that Navarro will convince Trump to turn criticisms to them once he is done criticising China.

Going forward, Trump needs to show nations in Asia that America is ready to continue to be a long-term predictable partner that will support them in times of danger. By 2050, China's and India's economies most likely will have surpassed America's. Smaller nations are deciding now whether to align with China or the United States. Trump can no longer stay silent on his intentions in the region.

Shaun Rein is the Founder and Managing Director of the China Market Research Group (CMR), a Shanghai based strategy consulting firm that helps multinationals, private equity firms and hedge funds develop their Asia strategies. He is also the author of "The End of Cheap China" and the "End of Copycat China"