Understandably, Washington seeks to extend its current alliance arrangements in (non-China) East Asia to South and Southeast Asia. In Japan, the Upper House of the Diet passed Prime Minister Shinzo Abe's highly controversial security bills, which are opposed by most Japanese. But India has an independent international outlook. And the Association of Southeast Asian Nations seeks to hedge between declining US influence and China's rising clout.

The broader region is not choosing between China and the US, but each and both. Despite friction with China, the Philippines expressed interest in the TPP, but stayed out for economic reasons, as did Indonesia and Thailand. Myanmar, Laos and Cambodia are not economically ready for the TPP.

As for TPP signatories, Vietnam and Malaysia gain access to important US markets, while Singapore seeks greater access to the Americas, along with tiny oil-rich Brunei. Vietnam has had disputes with China, but all four enjoy economic cooperation with China, which remains one of their largest trade partners.

As members of the ASEAN-China FTA, all ASEAN member states benefit from economic cooperation with China. China also has bilateral FTAs with individual TPP members, including Singapore, Australia and New Zealand, Peru and Chile. Australia welcomed the TPP deal, but weeks after it had signed its FTA with China.

Beijing is also in talks to upgrade the FTA with ASEAN, negotiating a China-Japan-South Korea FTA and the broader Regional Comprehensive Economic Partnership. Following the Xi-Obama Summit, China and the US sped up work on the bilateral investment treaty.

China may join the TPP at a later point but only when it makes economic and strategic sense. As reforms deepen, Beijing can also gain similar or possibly greater benefits through an FTA of the Asia Pacific.

Where does it all leave Asia? As mentioned before, there are good, bad and ugly scenarios.

In the "containment déjà vu" scenario, the exclusive TPP contributes to the militarization of the Asia-Pacific, while economic benefits decrease. Instead of unity, fragmentation triggers friction. Economic growth dims. The "Asian Century" fails.

In the "much ado about nothing" scenario, the US Congress torpedoes the deal in the short term, or bilateral and multilateral trade deals in the region mitigate the TPP's discriminatory effects over time.

In the "inclusive free trade" scenario, the TPP serves as a foundation for a truly Asia-wide FTA; one that has room for China, the US, and 21st century currency arrangements. China and the US conclude a bilateral investment treaty. Growth accelerates and economic relations broaden across South, East and Southeast Asia.

Only the last scenario can sustain the promise of the Asian Century.

The author is a columnist with China.org.cn. For more information please visit: http://www.jhzsvip.com/opinion/DanSteinbock.htm

Opinion articles reflect the views of their authors, not necessarily those of China.org.cn.