China is one of the major global powers in the world, and its economy is the second largest next to the US. However, its reactions in thrusting the external actors away from the South China and East China Seas exposes the insecure nature of the Chinese.
Starting with the issue of ‘one country two systems’: the main land Chinese eagerly expecting more freedom, the unsettled issue of Tibet as an autonomous region, and the Taiwan issue: these influence the causes of the Chinese unsecured environment. The world has been looking at the Chinese, because of its economic magic, since its liberalisation during the late1970s. However, the present economic downturn in their growth trajectory has caused concern for the Chinese leaders, which has been seen as the instrument of the Chinese power projection in the international system. The recent years’ upspring in West Asia and the democratic transformation in Myanmar has concerned the Chinese ruling elite to be cautious in their approach of containing the freedom of social media in China. The continuous containment of social media and religious freedom are in the direct control of the Chinese high command, which proves and acknowledges their unsecured nature. Hence, the Chinese reactionary approach in the disputed islands articulated their domestic concern which is directly linked to their stability and security.
The late former Singapore Prime Minister Lee said, “China will collapse like the Soviet Union, if it adapts democracy”. While its neighbour India has more to celebrate, its democracy would make for an uncomfortable situation for the Chinese. While in India 1.2 billion people cast their rights to select their representatives, the Chinese 1.4 billion people, voiceless in a suppressive condition,are not able to express their feelings by looking at the ruling elite. This would be a vulnerability for China. Now the recent transformation in their other neighbour, the Myanmar (Burma), into a democratic path will influence the Chinese public mind further.
Since its liberalisation during 1978, in the last three decades China had enjoyed the concept of being outward looking, and this benefited China as it largely modernised the infrastructure and their military. However, the recent continuous down fall in growth confused them and caused concern to the Chinese leadership. Their cheap exports made the Chinese the upper hand in global markets unchallenged by other competitors. Still their products are flooded in all western markets from toys to needles. This also providing mixed signals. The more the western countries import the Chinese goods, the more it would give an opportunity for the Chinese to be a predominant exporter. The west now has a trajectory to contain China by diverting their markets through Trans-Pacific Partnership (TPP).
So the present continuous economic decline makes the Chinese leaders think about course corrections to stabilise its growth rate by at least by 7 percent. Martin Wolf from the Financial Times says, “China will struggle to keep its momentum” (FT, April 2015). The other important dimension would be the more the Chinese liberalise its economy to stabilise its own economic system, they may unknowingly lose control over its people. This would lead to a challenge that a time frame will be waiting that the Chinese system will face, similar to the former Soviet under Mikael Gorbachev. This would not necessarily be an actual future threat for the Chinese, but it cannot be dismissed.
In 1997, the Hong Kong region was handed over to the Chinese by the British with the acceptance of “One country Two systems”. At that time, Hong Kong was welcomed, but not its democratic practice. However, China was forced to accept, without any other choice, the frame-work of “One country Two systems”. Though it was a moment of joy, it can be described also as a starting point for new challenges. The reason would, while the region of Hong Kong practiced democracy, in the same country the mainlanders would be suppressed without freedom of speech. The news about the election to elect the next Chief Executive of Hong Kong in 2017 – means the people of Hong Kong region will have the right to select their leader, but the main land of China cannot. It is natural that the mainlanders of China could not control the commotion in their mind supported by the fast communication-transferring world. The Chinese government can increase their iron curtain to control them physically, but they cannot delete the emotional progressive thought towards democracy in the main land people’s minds.
The Communist Party of China (CPC) has been in anxiety with a strategic trajectory of introducing “the kind of stage-managed democracy” in Hong Kong, says the former governor of Hong Kong under the British rule, Lord Patten. In 1989, the Chinese government supressed the unarmed students’ demonstration for pro-democracy in Tiananmen Square with an iron hand and caused many deaths. The protest was controlled. However, in today’s world with the predominant media presence, the Chinese government are prevented from applying the same procedures on the Hong Kong protesters against the Chinese government to control the democracy process in Hong Kong.
The civil war in China ended by the defeat of Kuomintang (KMT) with the Communist Chinese Party in 1949, but KMT established the government in Taiwan. Taiwan’s transformation as a multi-party democracy in the 1980s caused the Chinese to perceive them as a threat posed to them due to their democratic structure. Since 1949, the KMT and the Chinese leadership first met in 2005. This causes an uncomfortable polarisation for the KMT in Taiwan, since in the recent local body elections largely benefited the Democratic Progressive Pan-Green (DPP). The reason would be the KMT in recent times transformed as pro-Chinese, and the Taiwanese main opposition DPP is more divergent from China.
The presidential election in Taiwan will be held in January 2016. As this article was being written, the KMT candidate Wang Ju-hsuan was more than 25 percentage behind the opposition candidate Chen Chien-jenof DPP. In this context, the recent Xi Jinping and Ma Ying-jeou meeting in Singapore this November raised the eye-brows of strategic thinkers. The outcome of the talks could not be perceived in a clear strategic vision. However, the perception would be while the 2016 election will clearly favour the DPP candidate in Taiwan, this will result in a more hostile relationship with China. Further, the victory of the DPP in Taiwan would also dictate the future US and Chinese relations.
China has been claiming ownership for all the artificial manmade rocks on the South China Sea. The recent fleet of US warships closer to the disputed island sindicates that the US are reassuring support for its allies over their claim on the disputed islands in the region. This exercise has cautiously transferred the fear of communication to the Chinese about the US strategic interest on India-Pacific region – which passes more than 30 per cent of global trade. Those countries also have claim over the disputed islands like Japan, the Philippines, Indonesia and Malaysia’s concerns are not resolved through these demonstrations by the US, but give a comfortable zone. This asserts a strong message to the Chinese that the US Pacific fleet will continue to ensure the freedom of navigation without any aggression from other states around the disputed islands in the South China Sea.
Why the Chinese panic more about the disputed area is because of the prevailing nature of the domestic insecurity. This can be easily compared with the Russian reactionary approach while the US backyard NATO reached out to the Ukraine. Kissinger rightly said, “China’s greatest strategic fear is that an outside power or powers will establish military deployments around China’s periphery capable of encroaching on China’s territory or meddling in its domestic institutions”.
How China is helping Iran skirt US sanctions
Shortly after the Trump administration reimposed sweeping sanctions on Iran, Secretary of State Mike Pompeo said eight countries, most notable China, would be exempted from the draconian sanctions on buying Iranian crude oil.
Shortly after the Trump administration reimposed sweeping sanctions on the Islamic Republic of Iran, Secretary of State Mike Pompeo made an important announcement. It was a calculated move to avoid a major embarrassment. The hawks in the power corridors of Washington had anticipated the backlash of sanctions on US foreign policy with many global powers rebuffing Trump’s foolhardy move.
Pompeo said eight countries would be exempted from the draconian sanctions on buying Iranian crude oil due to special circumstances. The countries included China, India, Italy, Greece, Japan, South Korea, Taiwan, and Turkey.
Many of these countries had quite clearly indicated that they would not be cutting oil imports from Iran under the US pressure, most importantly China, Turkey, and India – three of Iran’s largest oil customers.
While India has its own strategic interests in maintaining good relations with Tehran, for instance, the Chabahar port project in Sistan-Baluchistan, Turkey’s relations with Washington have hit a new low following sanctions and trade tariffs imposed by the US.
China, which has emerged as a viable counterweight to US hegemony in the world and a protagonist of new international economic policy, has unambiguously reaffirmed its commitment to keep alive the Iran nuclear deal and stand by the Islamic Republic of Iran.
On November 5, when the petroleum-related sanctions came into effect, Chinese foreign ministry said it will continue to “hold a fair, objective and responsible attitude” and “resolutely safeguard its legitimate rights”, while reiterating its opposition to the unilateral US sanctions.
“China feels sorry for the US’ decision and we noticed that the international world as a whole opposes the practice of such unilateral sanctions,” foreign ministry spokesperson Hua Chunying said at a press briefing.
She said Iran has been seriously fulfilling its obligations under the JCPOA and its efforts have been recognized by the International Atomic Energy Agency dozen times. She also affirmed that China will firmly safeguard its lawful rights while continuing to adhere to JCPOA and urged relevant parties to stand on the “right side of history”.
China has maintained that implementing the Iranian nuclear deal is akin to safeguarding the authority of UN Security Council, basic norms of international law, international non-proliferation treaty and peace and stability in the Middle East.
As one of the remaining signatories of the JCPOA, along with European Union countries who are exploring options to circumvent the US sanctions, Beijing wants to keep the deal alive. China, believe experts, is in a better position compared to other Asian countries as it is not subservient to US interests and is already embroiled in a bitter trade war with Washington.
For all parties of the JCPOA, Iranian crude oil is the main commodity of interest, particularly for Beijing. In 2017, one-third of Iran’s oil was supplied to China, which underlines the significance of oil trade between the two countries. China’s commitment to continue importing oil from Iran is very likely to deal a body blow to US ploy of reducing Iranian oil imports to zero and ‘starving’ the Iranian nation.
Hu Xijin, chief editor of the influential Chinese daily Global Times, told Tehran Times that there was no possibility of Washington reducing the Iranian oil exports to zero, “because Washington lacks righteousness to do so, therefore it can’t have the full support of the international community”.
To continue oil trade in different currencies other than dollar, Iran has been in talks with key allies, including China. On September 29, Foreign Minister Javad Zarif said Tehran would circumvent sanctions by conducting trade in all currencies to avoid using the US dollar. “You can use your own currency. Sell stuff in your own currency, buy stuff in the other country’s currency, and at the end of a specific period, balance it out in a non-dollar currency. It’s quite possible and may even be profitable,”
China, which is the largest oil importer in the world with around nine million barrels imports every day, has been making concerted efforts to reshape the global oil market with increased usage of its currency in oil trading. If Chinese currency manages to replace the US dollar, it will be a masterstroke.
US has been rendered friendless and isolated in its quest to tear up the Iran deal and force countries to cut oil imports from Iran. European Union has already refused to back down on the Iran deal, exploring ways to develop payment channels to facilitate payments related to Iran’s exports. The goal, according to a statement issued by EU, “is to protect the freedom of other economic operators to pursue legitimate business with Iran”.
Beijing has expressed its full support to the EU’s proposal to set up a “special payments system” to facilitate trade with Iran and safeguard the Iranian nuclear deal, which experts believe will significantly reduce reliance on the US dollar in the global oil trade. That will be a game-changer.
First published in our partner MNA
The Implication of China’s Diplomacy in APEC and ASEAN
It is truly unusual that the Chinese President Xi Jinping and its Premier Li Keqiang are visiting the same area during nearly the same time: Xi’s visit to APEC from15th to 21st November and Li’s visit to ASEAN on 15th November. Yet, if we look into China’s foreign policy towards this area over the past years since President Xi took power, it is not difficult to understand both Xi’s and Li’s official visits to the “larger Pacific” and the meaning beyond.
As we know, President Xi has reiterated that the Pacific is large enough for the countries involved to share the prosperity with each other. In order to achieve the inclusive rather than exclusive benefits for all, China’s diplomacy aims to reject any kind of unilateralism, trade protectionism and anti-globalization. Given this, Xi’s at APEC and Li’s at AEASN is defined as a signal of China’s diplomacy to further reform and bold openness.
As a rising great country, China is surely eager to expand its investment and trade with the south Pacific area, and Papua New Guinea (PNG) is the first country visited by Chinese president. What is more, PNG joined the Asian Infrastructure Investment Bank (AIIB) early 2018 and then became the first state of Pacific islands to sign the MoU on “The Belt and Road Initiative” construction. As the theme “Harnessing Inclusive Opportunities, Embracing the Digital Future,” the APEC summit will focus on Regional economic integration, digital economy, connectivity, sustainable and inclusive growth and so forth.
Also during Premier Li’s visit to the ASEAN, he highlighted the necessity of the collaboration and mutual benefit among the countries involved on the 21st China-ASEAN leaders meeting. This is also the 21st ASEAN Plus Three Summit (10+3) and the 13th East Asia Summit (EAS).
Quite understandable, since the 1960s, the center of world economy has shifted from North Atlantic to Asia-Pacific, its dynamic growth in the region create countless jobs and push the development of world economy. This is the reason that Asia-Pacific region has the most trade agreements and the most complicated economic architecture around world. APEC and ASEAN, as two institutions that possess most member states, are the very pillars of the tumbledown regional economic architecture. APEC was launched by Australia and later included 21 member states in the region, amongst are United States, China, Japan, the economic giant three of the world economy. ASEAN is an institution that consist of ten small and middle states. Though they are not strong enough to meet the challenges from the power politics alone, ASEAN is a core force that firmly facilitate the economic integration of the whole region of East Asia and the Pacific. No matter what the way they embrace, they are the de facto basic regionalism of Asia-Pacific. The withdrawing of United States from Trans-Pacific Partnership (TPP) and hard-achieved Regional Comprehensive Economic Partnership (RCEP) once brought the regional economic architecture a fig leave and strengthened the impact of APEC and ASEAN.
As a result, the two visits of Chinese top leaders to the same region at the same time definitely attract worldwide attention, because they not only represent China’s recent diplomatic focus but also mark the fact that Asia-Pacific region has become one of the vital fields where China’s diplomacy will be actively conducting in terms of the Belt and Road Initiative, and carry on the good-neighbor policy. Since China has argued for creating a peaceful development milieu, to enhance economic transformation and upgrading oversea markets and partners in Asia-Pacific region.
Consider these facets, China, as the second largest economy, aims to promote its well-articulated stance on multilateralism and inclusiveness and globalization. As both President Xi and Premier Li have strongly said that China is ready to work with Pacific island countries to endeavor together and sail for a better future for bilateral relations. For the sake of that goal, China always believes that as long as all the countries involved have firm confidence in each other’s development, cooperation and the future of East Asia, and work closely together and forge ahead, all sides would achieve more and reach a higher level in the next 15 years.
For sure, China belongs to the part of a larger Asia-Pacific family, and the Chinese government defines its goal as the shared prosperity of this region. Therefore, China will continue to work hard and constructively to promote the overall development of impoverished but promising Pacific island countries under the Belt and Road Initiative.
An uncertain step in moving China-Japan relations
Authors: Meshach Ampwera & Luo Xinghuan
On October 26, Chinese President Xi Jinping met Japanese PM Shinzo Abe and praised that both China and Japan have pledged to strengthen bilateral ties amid continuous efforts made by the two nations. Xi said, “Bilateral relations have returned to the right track and gained positive momentum, which is something the two sides should cherish.” As the two largest economies in Asia, China and Japan are also the vital players in Asian security and the global development.
In addition, since this is the first official visit to China by a Japanese PM in a seven-year “Cold Peace” period, it is widely assumed that Abe’s visit symbolizes the resumption of high-level visits and will be followed by an increasing rapprochement between China and Japan. True, the leaders of the two economic giants witnessed a wide range of agreements, including a 30 billion US dollar worth of currency swap pact, the establishment of a maritime and air liaison mechanism, and enhancing people-to-people exchanges.
Yet, three factors have to be considered seriously in looking into Japanese foreign policy given the current changing geopolitical landscape regionally and globally. First, Japan has still regarded itself as a “defeated” state during the WWII. Since then, Japan’s postwar posture has frequently described as a new pacifism; yet in fact it is considerably more complex. As Henry Kissinger put it: “Japan had acquiesced in the U.S. predominance and followed the strategic landscape and the imperatives of Japan’s survival and long-term success.” This means that the governing elites in Tokyo used to hold the constitution drafted by U.S. occupying authorities with its stringent prohibition on military action, and adapted to their long-term strategic purposes. As a result, Japan was transformed from the pacific aspects of the postwar order (that prohibited military action) into a nation that has focused on other key elements of national strategy, particularly using economic leverage regionally and globally, though not uncontroversial.
Second, in a recently-released paper written by the former US Secretary of Defense Ash Carter, he maintained that “Japan is a close ally of the U.S. and a rising military power, too, because of legal and constitutional changes of great significance championed by Prime Minister Abe.” In practice, the Japanese administration has engineered an expansion to enable its military to operate regionally and even globally in response to the rise of China, violent extremist activity in Asia, and the alleged North Korean belligerence.
Actually in 2013, Japanese Government White Paper revealed a desire to become a “normal country” with an active alliance policy. In a searching for a new role in the Asia-pacific region, Japan aims to act as an “anchor” of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) concluded in 2018 after the withdrawal of the United States. Now it involves 11 countries and representing 13.4% of global GDP ($ 13.5tri.). As the largest economy of the CPTPP, Japan has been active in moving it forward. Early this year when the British government stated it is exploring becoming a member of the CPTPP to stimulate exports after Brexit in 2019, Abe stated that the United Kingdom would be welcomed to join the partnership. It is said that even the U.S. reconsiders possibly rejoining the CPTPP if it were a “substantially new deal” for the United States.
Japan’s ardent involvement into the US-led strategy in Asia has also been endorsed to expand steadily as a normal power regionally and globally. For example, the Asia-Africa Growth Corridor (AAGC) is the result of the joint declaration issued by the India and Japan in 2016. Although it is premised on four pillars of development and cooperation, it is self-evident that the AAGC reflects a growing special “strategic and global partnership between India and Japan” in which both sides have viewed China’s growing, pragmatic and successful presence in Africa as a menace. There is no question that AAGC is a well-crafted vision and agenda of both India and Japan, linking with their own development priorities. But with increasing pressure from Washington and Brussels, Japan and India are in effect driven by the option for the AAGC to rebalance China’s Belt and Road Initiative (BRI).
From the inception of the BRI, they have more than ever before been concerned with being isolated in Africa by Beijing’s initiative. But, as Ampwera Meshach, a researcher at Jilin University put it, “Africa is on the growth trend and offers potential markets and raw materials. For this reason, Africa largely needs pragmatic and scientific, technological and development- oriented initiatives and these are clearly reflected in China’s BRI.” In light of this, the AAGC does neither reflect a novel nor pragmatic approach on how it fits within the African agenda. Instead, AAGC’s foundational pillars seem more inclined to the Western cooperation approaches that have for decades not been translated into development.
Controversially, two days before Abe’s visit to Beijing, Japan had decided to scrap official development assistance (ODA) to China, which is a program where Japan provides aids to developing countries starting back in 1954. Even though some people argue that Japan’s ODA is reasonably cancelled because China’s GDP is even 2.5 times larger than that of Japan, yet, it is necessary for Chinese to be aware of the reality that Japan is a longstanding ally of the United States. As Japan has long been an economic power, its impressive military capabilities would not be confined to a strict policy of territorial defense—no projection of Japanese power or the U.S.-Japan alliance to the region as a whole.
It is during the Abe’s administration which has recognized an environment of growing Chinese assertiveness, violent extremist activity in Asia, and North Korean hostility, and therefore, Japan has eagerly participated in Asian security, including training and exercising with other nations, beyond a purely passive, home-island defense role. This makes it an increasingly important player serving the US strategy in Asia but challenging the rise of China globally.
It is true that Abe tweeted about the trip — while recognizing the challenges in moving bilateral relations forward, he said that he would still work to “push Sino-Japan relations to the next level”. Given the two countries’ economic links, it is only understandable that there is a need for the two sides to come closer. Moreover, Japanese businesses has been an extremely active force behind the government’s shift of attitude on the Belt and Road Initiative (BRI).
Yet, all in all, we should never ignore that Japan’s ambitious foreign policy has gone beyond the economic goal.
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