President Barack Obama hosts Southeast Asian leaders at an unprecedented summit in California starting Monday as he looks to deepen ties with the region's fast-growing economies. But a nation not invited — neighboring power China — will be the proverbial elephant in the room as the leaders grapple with sensitive territorial disputes.

TOP ISSUE: SOUTH CHINA SEA

The top security issue on the agenda. China says it has a historical right to virtually all of the South China Sea and has built seven artificial islands, including airstrips, to assert its sovereignty. Taiwan and ASEAN members Brunei, Malaysia, Vietnam and the Philippines also claim land features in these potentially resource-rich waters, an important thoroughfare for world trade. Although not a claimant, the U.S. has spoken out against China's conduct and the Navy has sailed close to some of the artificial islands, angering Beijing but getting some quiet encouragement from most ASEAN members. The U.S. is looking for ASEAN to take a unified stance by calling for the territorial disputes to be resolved according to international law.

TRADE AND TPP

America has longstanding economic interests in Southeast Asia. U.S. companies have invested $226 billion in the region, and two-way trade was $254 billion last year. On Day One at Sunnylands, the leaders will discuss how to expand trade and investment with the help of U.S. entrepreneurship and innovation. Also likely on the agenda: the Trans-Pacific Partnership, or TPP, Obama's signal achievement on trade, which the administration often characterizes as an opportunity for the U.S., rather than China, to shape the rules of world trade. The four ASEAN members in TPP — Brunei, Malaysia, Singapore and Vietnam — will want to know if it Congress will ratify the pact, which remains in doubt. Other ASEAN members, like Indonesia, the Philippines and Thailand, have expressed interest in joining TPP at a later date.


http://www.sfgate.com/news/politics/article/Things-to-know-about-Obama-s-summit-with-SE-Asian-6828309.php