Former US treasury secretary Henry Paulson warns of an “economic iron curtain” descending as rivalry between the US and China deepens. Singapore prime minister Lee Hsien Loong says as tensions flare, Southeast Asian nations may be forced to choose which side to be on. The position of smaller nations caught in the middle is already uncomfortable. It will become more so if Washington and Beijing persist on imposing their own exclusive rules. Yet neither side appears willing to work towards an accommodation that is in their own interests. The annual heads of government meeting of the Asia-Pacific Economic Co-operation (Apec) last weekend showed the shape of things to come. Apec is usually little more than a feel-good photo opportunity for leaders from a jumble of nations that happen to border the Pacific. But on Sunday, for the first time in its 29-year history, the group failed to agree on a joint communiqué. The reason for this dysfunction was a standoff between the US and China afte...

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