Nov. 5 (Bloomberg) -- Asia's leaders, led by an ascendant China, say they hope Barack Obama didn't really mean those campaign promises to protect American trade. And if he did, they are in better shape to object than ever before.

To Asian ears, Obama's calls for tougher labor and environmental rules and steps to reduce the U.S. trade deficit sound like thinly veiled protectionism, just as a global financial crisis makes exports more crucial than ever.

``The immediate concern with Obama will be economic relations,'' said Wu Xinbo, deputy director of the Center for American Studies at Fudan University in Shanghai. ``The U.S. will be less forthcoming in pursuing economic liberalization in the Asia region'' because of concerns about jobs lost to trade.

Obama's goal of corralling developing economies into binding pollution-reduction commitments and his pledges to insert labor and environmental standards in trade agreements may spark unified opposition in an Asia that has more tools than ever to resist Western pressure.

Already, China is actively defending itself in the World Trade Organization, which it joined early in President George W. Bush's first term. India and China this year brought global trade talks to a standstill in a dispute over farm tariffs. On climate change, the so-called G-77 group representing the world's developing countries has negotiated as a bloc.

Moderate Approach

Bush and predecessor Bill Clinton promised a hard line on China as candidates and then pursued a more moderate approach once in office, faced with the reality of economic interdependence. Obama, 47, will follow that tradition, said Zhang Liping, a senior fellow at the Institute of American Studies of the Chinese Academy of Social Sciences in Beijing, because the U.S. needs China's help to solve the financial crisis that threatens economies worldwide with recession.

``I don't think he will be tough on China, because at this moment the U.S. government needs the Chinese government to help,'' she said. ``This is a globalized economy, not just an American economy.''

China may express its concerns at a Nov. 15 meeting of world leaders on the financial crisis, ``a good opportunity to have this kind of early warning,'' to the new administration, according to Wu.

Stalled Trade Deals

The Democratic senator from Illinois will inherit decisions on free-trade agreements with South Korea, Colombia and Panama; all three are stalled in Congress. He advocates renegotiating parts of the Korea pact, which South Korean Deputy Trade Minister Ahn Ho Young ruled out at a briefing on Oct. 28. He also wants to add new labor and environmental standards to the North American Free Trade Agreement.

On climate-change, negotiations over a global treaty to follow the Kyoto Protocol, which expires in 2012, continue in December in the Polish city of Poznan.

Asia's leaders say the global financial meltdown has undermined the U.S. as an economic model and advocate of free- market policies, particularly in a region that suffered through its own crisis in 1997 and 1998.

``The U.S. capacity to dictate terms on trade and environment issues to Asia has weakened considerably,'' said N. Bhaskara Rao, chairman of the Centre For Media Studies, a political-policy group in New Delhi. ``They are done in, big-time, by the economic mess they are in.''

Asia's Preparation

Since the 1997 financial crisis, Asia's combined gross domestic product, excluding Japan, has climbed to $7.48 trillion last year from $2.92 trillion in 1998, according to International Monetary Fund statistics. Their experience 10 years ago has left countries both better prepared for the current situation and determined to respond as a bloc.

Asia is ``facing the challenges together rather than running away individually,'' said Surin Pitsuwan, secretary general of the Association of Southeast Asian Nations, in an Oct. 24 interview. ``All of us have concerns about protectionism.''

China and its neighbors are already sending signals that they won't tolerate trade restrictions. The Foreign Ministry last week called on the U.S. to lower trade and investment barriers and stop blaming China's currency policies for the trade gap between the two countries.

China has also led emerging economies in sending the message that the U.S. and other rich nations are mainly responsible for coming up with a solution to climate change. The Asian nation is seeking to gradually shift its energy structure without sacrificing economic growth and has called on the U.S. and Europe to step up with financing and technology.

Developing Alliance

China can draw on its alliance with other developing economies worldwide, not just in Asia, as it did earlier this year at the Group of Eight summit in Japan. China, India, Brazil, Mexico and South Africa displayed their consensus on trade and environment issues, rejecting numerical targets on climate change and emphasizing the alleviation of poverty.

``Developing countries are likely to side with China,'' said Huang Jing, a visiting professor at the National University of Singapore's Lee Kuan Yew School of Public Policy. ``China will have more leverage to drive a hard bargain with the U.S.''

China's President Hu Jintao congratulated Obama in a telephone call today, according to a statement on the country's Foreign Ministry Web site.

``The China-U.S. relationship is of great significance for the promotion and maintenance of world peace, stability and development,'' Hu told the new U.S. leader.

In the end, said Robert Fitts, a former U.S. ambassador and a lecturer at Chulalongkorn University's Institute of Security and International Studies in Bangkok, the region sees its interests more aligned than at odds with the U.S.

``U.S. leadership is a fairly tarnished coin,'' he said. ``But these people out here aren't stupid, and the engine that is driving all of their economies is the U.S. market.''

To contact the reporter on this story: Dune Lawrence in Beijing at dlawrence6@bloomberg.net

Last Updated: November 5, 2008 03:35 EST