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The Greatness of a ‘Normal’ Iran: The Real Challenges for a Post-JCPOA

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The recent Joint Comprehensive Plan of Action (JCPOA) agreements between Iran and the international community will, no doubt, have a major impact on Iranian domestic politics. The agreements open the door to an increased opportunity for improved foreign relations and international business agreements that will be needed to help Iran emerge from years of economic hardship created by international sanctions. The question will be whether Iran will itself walk through this doorway to a more inclusive future in the international community or whether it will slowly close the door, untrusting of those waiting on the other side.

One thing is sure, however, and that is that whether or not Iran chooses the path of better international engagement, it will be done at Iran’s pace, and given the current structure of its ruling elite, that pace will be slow moving. The Iranian ideological structure is built to retain the status quo and given the level of distrust of the international community any amount of cooperation will be hotly contested. With conservatives firmly in control of the real sources of power, any foreign investment and involvement in the country goes against the grain of their core principles as was recently echoed when Ayatollah Khamenei recently said, the JCPOA is “just an excuse and a tool for penetration” and “an instrument for imposing their demands”. The push, however, will come from working and middle class Iranians who have suffered from years of recession and high inflation and are keen to see the economic inequality between themselves and those that have continued to prosper during the sanctions reduced.

Ideally a potential path for Iran would be one similar to that taken by China, starting in the late 1970s. Overcoming the trajectory set in place by Mao Zedong, reformers, led by Deng Xiaoping, moved the nation away from the communist ideology of the past and towards a more western capitalist approach. This would, however, be a difficult path for Iran. In Iran, unlike China, the Ayatollah inherits his power through Islamic ideology and without it his place at the top of the ruling structure would be in jeopardy. It is this resistance to relinquish any semblance of control that has highlighted Ayatollah Khamenei’s tenure to date. Since gaining power in 1989 Ayatollah Khamenei has not hesitated to use violence against his own people, as we saw in the Green Revolt of 2009, in order to retain firm control of the nation and to ensure alignment with the direction set forth in the 1979 Revolution. This violence, however, has also severed the delicate bond needed between the greater society and its ruling elite and is further exacerbated by the extreme economic hardships being suffered by the common Iranian.

Given the unlikelihood of any meaningful reform to the leadership structure of Iran there are, however, steps that can be taken to bring some measure of prosperity back into the common Iranian’s life without the wholesale changes that would require nothing short of another revolution. The first step would be to produce a more stable environment through which business and trade can be conducted within the private sector. The government would need to relinquish some of the control that it pulled from the private sector and tone down, somewhat, the anti-foreign rhetoric, allowing the international community greater access to investment opportunities throughout Iran. The JCPOA has gone a long way towards beginning the process of improving Iran’s standing within the international community and the government should work to not lose that momentum. Some forces inside Iran favor a stricter Iran that is resistant to interaction with outside nations and more isolationist, not unlike North Korea. It will be up to leaders like Rouhani to counter these groups and move Iran towards a more inclusive role in the global community.

The state should also ensure that it not fall into the trap of relying simply on the easy money that an easing of sanctions and a return of its oil and gas exports will bring. Wealth brought on by the export of oil and gas and used to purchase foreign-made products will not have the desired effect in reducing the state’s crippling unemployment problem, so emphasis should be given to the promotion of building a larger breadth of industry, such as manufacturing and agriculture, that could begin to support job growth among the largely unemployed youth of the nation. This is an important distinction to be made with a nation that has the rich cultural diversity and history of Iran.

The national economy is currently faced with at least five major imbalances that must also be addressed: (1) An international payments imbalance due to a highly over-valued exchange rate, increasing reliance of imports, lagging genuine non-oil-based exports, and a precarious and uncertain future oil-export market; (2) A budget imbalance caused by rising expenditures in the face of stagnant and doubtful revenues; (3) A resource imbalance due to artificially low prices for water, power, and fuels that encourage ever-expanding demand; (4) A monetary and financial imbalance resulting from government-directed low interest rates, non-performing banking assets, rising defaults, and an increasing flow of savings into the informal market and capital flight; (5) Finally, a labor imbalance resulting from the rising work force, inadequate in housing and industry, and an anti-business labor code. (Amuzegar, 2014)

Another key element going forward, and particularly in the case of President Rouhani, as his campaign platform is focused on such items, is progress in levels of freedoms, civil liberties, and political rights. Since his election Rouhani has focused mainly on the nuclear talks and to this point he has gotten a pass on some of these campaign promises not being addressed but as the JCPOA grows more distant in the rear view mirror he will be held more and more accountable for his inaction on these items. If Rouhani is to retain the level of support from the Iranian public that brought him into office then he will need to make significant progress into these areas. The unelected political elite do not share Rouhani’s vision for an increase in these freedoms and civil liberties, as they come into direct conflict with their conservative ideologies. So it is imperative that Rouhani work to find means to bridge the ideological gap.

Within Rouhani’s power to affect change in a positive manner, and in keeping with his campaign pledges, include items such as increased freedom of speech. Currently media outlets can be prosecuted for such things as criticizing government organizations and it is well within Rouhani’s power to encourage more restraint in these instances. Another important major platform promise that Rouhani will need to address was his promise to uphold the rights of women and to address cases of discrimination against them. The removal of restrictions on the participation of females in government, and enrollment of female students in certain academic disciplines, are all key items of concern.

A final matter of concern is that of governmental transparency. Currently there is a considerable lack of basic and reliable information needed to conduct basic business with regards to the nation’s economic issues. A key impediment to this much needed privatization is the lack of ownership structures needed to ensure proper transfers of entities to the private sector. Commitments to the observance of law and transparency throughout the legal process is also essential in establishing even the most basic of environments necessary for the successful integration of foreign businesses. This is where Iran is at the moment. The REAL success of the JCPOA is not so much in Grand Strategy proclamations and reinvigorating Empire, but rather in the small incremental successes of normalcy for the Iranian common people.

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A New Era in US-Jordan Relations

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President Joe Biden meets with Jordan's King Abdullah II in the Oval Office of the White House in Washington, Monday, July 19, 2021. (AP Photo/Susan Walsh)

King Abdullah of Jordan is the first Arab leader who met American President Joe Biden at the White House. The visit has reaffirmed the strong and long-standing Jordan-US strategic partnership and reinvigorated the bilateral engagement for working together on security issues, and economic development on the basis of shared values and priorities. The King’s visit to Washington reaffirmed Jordan’s value as a reliable ally who plays a critical role for stability in a highly volatile region.

Jordan’s value is multi-dimensional and ranges from bilateral military cooperation, intelligence sharing and joint global counterterrorism operations including as a member of the Global Coalition to Counter ISIS and the Combined Joint Task Force-Operation Inherent Resolve to deployment of almost three thousand (3,000) American troops to Jordan as part of the ongoing campaign to combat regional terrorism. The US has expanded military footprint to Jordan after Washington’s decision to withdraw forces from Syria and reduce military presence in the Turkish airbase of Incirlik. In addition, the kingdom’s geopolitical position in the heart of the Middle East provides a viable alternative for logistical support to the American military taking into consideration the US decision to withdraw from Afghanistan and close three bases in Qatar. Notably, the remaining supplies from the three Qatari bases along with the Support Mission have been transferred to Jordan and have become part of the Area Support Group-Jordan that operates as the Base Operations Support Integrator to back contingency operations and military-to-military engagements within the US Army Central Command’s area of responsibility.

Jordan’s value also stems from its critical role in addressing the overwhelming humanitarian needs created by the conflicts in Syria and Iraq as well as in hosting almost two million registered Palestinian refugees.

Support of Two-state Solution

The fact that Jordan remains at peace with Israel and is a key interlocutor with the Palestinians adds to the kingdom’s reliability to mediate and advance initiatives that support the two-state solution. This presupposes the resetting of Jordan-Israel relations. Washington is well-placed to offer its good offices and help restore trust between the two neighboring countries. The twenty-seventh year Jordan-Israel peace treaty shows not only the possibilities for coordination and co-existence but also the ceilings to peace with Israel in the absence of a solution to the Israeli-Palestinian conflict. A “cold peace” and quiet, limited cooperation are currently the maximum possibilities vis-a-vis a “warm peace” that will unlock Jordan-Israel cooperation and potential.

It is nevertheless noteworthy that the last five years have been discerned by the previous American administration’s lack of appreciation of the complexity of the Israeli-Palestinian conflict. The Trump peace proposal, known as “the Vision”, not only undermined the long-established aim of a two-state solution but also reinforced discussions over alternatives including a one state outcome to the Israeli-Palestinian conflict; different measures of annexation, such as Israeli annexation of Area C in the West Bank; “exotic options” such as a federation in which Israel and Palestine share certain aspects of sovereignty; potential unilateral Israeli initiatives with most prevailing a Jordanian model, in which Jordan takes control of the West Bank and Palestinians are given Jordanian citizenship; and, reinforcement of the notion that “Jordan is “Palestine””.

Practically, Jordan can serve as honest broker in any future Israeli-Palestinian peace process, but as the late King Hussein stated in an interview with The New York Times in 1991 “Jordan should not be, cannot be, will not be a substitute for the Palestinians themselves as the major aggrieved party on the Arab side in a process that leads to peace”. The cited statement is fully embraced by Jordan’s current leadership.

Acknowledgment of Jordan’s Custodianship

The public acknowledgement by the American President of the kingdom’s special role as custodian of the Muslim holy places in Jerusalem is translated into a vote of confidence and a commendation for Jordan’s efficient safeguarding of religious sites for decades.  As known, Amman pays the salaries of more than one thousand (1,000) employees of the Jerusalem Waqf Department and its custodianship role is carried out on behalf of all Islamic nations. The kingdom holds the exclusive authority of the Jordanian-appointed council, the Waqf, over the Temple Mount/ Haram Al Sharif and has spent over 1 billion dollars since 1924 for the administration and renovation of Al Aqsa mosque.

Jordan has admittedly served at multiple occasions as credible intermediary for Israel and the Palestinians to suspend tensions in the old city of Jerusalem, particularly at the Temple Mount/Haram Al-Sharif and pursues a successful administration of religious funded schools favoring moderate religious education and religious tourism. Jordanian moderation has guaranteed co-existence of the three monotheistic religions in Jerusalem at a time when on the contrary, counties like Turkey funnel millions of dollars in charity projects in Jerusalem promoting the ideology of the Muslim Brotherhood.

Overall, Jordan’s custodianship has proved to be successful in maintaining delicate arrangements for the benefit of all religions and parties involved.

American Loan Guarantees

The King’s discussions with the American President also centered on the economic challenges exacerbated by the effect of the pandemic and the enhancement of bilateral economic cooperation. Admittedly, Jordan showed strong leadership and governance with early actions that reduced the coronavirus pandemic pressure on the kingdom’s health system. The Jordanian government imposed a nationwide lockdown and severe social distancing measures at a much earlier stage of the pandemic than other Middle East countries.

Jordan withstood the pandemic’s impact with minimal loss of life but with a significant cost to its economy. As of June 2020, most restrictions on economic activity were lifted turning Jordan into one of the first Arab countries to reopen. Gross Domestic Product (GDP) has contracted in 2020 by 3.5 percent after growing 2 percent in 2019 due to losses in state revenues because of fewer remittances and a weakened tourism market.

To cope with the direct negative effects of the pandemic on its state budget, the Kingdom received $396 million from the International Monetary Fund (IMF). The amount of finance has specifically helped address the country’s balance of payments needs and allowed for higher spending on healthcare, and assistance to households and companies most affected by the pandemic. Despite that the IMF provided in March 2020 another multi-year $1.3 billion loan package to Jordan, the pandemic has caused a $1.5 billion shortfall in its balance of payments.

This complex economic reality along with Jordan’s moderation in the Arab world justify continued robust annual American economic assistance to the kingdom in the form of budgetary support (cash transfer), USAID programs in Jordan, and loan guarantees. US cash assistance should increase in the coming years taking into consideration that it is directed to refugee support and to segments of the economy that are mostly affected by the pandemic like foreign debt payments and fuel import costs. Overall, a pledge should be made for Jordan in American congress for the authorization of moreUS sovereign loan guarantees that will help the kingdom weather the pandemic’s adverse medium-to-long-term effects on its economy. US sovereign loan guarantees will allow Jordan to issue debt securities that are fully guaranteed by the American government in capital markets, effectively subsidizing the cost for the Jordanian government to access financing.

It is also noticeable that in a genuine effort to help the kingdom contain the pandemic and safeguard public health, the American administration proceeded with the delivery of over 500 thousand covid-19 vaccines to Jordan highlighting American commitment to international vaccination programs including that of the kingdom.

US-Jordan Defense Partnership

The strategic US-Jordan defense relationship was reflected in the discussions that were conducted between the Jordanian King and the American President. American support for the modernization of Jordan’s F-16 fighter jets has been at the forefront of the agenda with the aim of achieving greater interoperability and effectiveness for the Jordanian Armed Forces.  The American President recognized Jordan’s contribution to the successful international campaign to defeat ISIS and honored as an example of heroism the memory of captain Muath al-Kasasbeh who was executed in 2015 by the terrorist organization’s militants.  

Jordan has suffered avowedly from terrorism throughout the years and works collectively at regional and international levels to eliminate all its forms. The kingdom lost two prime ministers, Haza’a Al-Majali and Wasfi Al-Tal, as victims of terrorism and experienced a series of terrorist attacks like the simultaneous suicide bombings against three hotels in Amman in November 2005 that led to the loss of life of American, Israeli, Palestinian, and Jordanian nationals.

In effect, Jordan is the third-largest recipient of annual American foreign aid globally, after Afghanistan and Israel. A Memorandum of Understanding on American foreign assistance to Jordan commits the United States to providing $1.275 billion per year over a five-year period for a total of $6.375 billion (FY2018-FY2022). Renegotiations on the next such agreement for FY2023-FY2027 is estimated that will aim at increasing the American commitment to Jordan, a key ally in the fight against international terrorism whose military should be in position to procure and maintain conventional weapons systems.

On the whole, Jordan is a steadfast security partner of the United States in the Middle East whose moderation and pragmatism helped the kingdom weather regional and world challenges. As 2021 and past years have showed, Jordan’s position as a bridge between the Levant and the Persian Gulf provides it a unique geopolitical standing, in a way that nowadays Amman is granted with a significant security, diplomatic and humanitarian role that signals a new era in US-Jordan relations.

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Chinese FM Wraps Up his Visit to Egypt

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Wang Yi, the Chinese State Councilor and Foreign Minister, visited Egypt on July 18, 2021, in El Alamein City, northwest Egypt. The Chinese Foreign Minister is the first foreign official to visit this strategic city.

Wang Yi met with his Egyptian counterpart, Sameh Shoukry, during his visit to Egypt, and they discussed bilateral relations between the two countries. This year marks the 65th anniversary of the establishment of diplomatic relations between Egypt and China. Egypt is the first Arab country to establish diplomatic relations with China and the first African country to do so. In the Arab world, the Islamic world, Africa, and developing countries, Egypt has long been one of China’s most important strategic partners. At the international level, the two countries mutually support one another. The meeting between Egypt’s Foreign Minister and China’s Foreign Minister focused on three main issues: the Covid-19 vaccine, the One Belt One Road Initiative, and international and regional issues such as Palestine and Syria

Covid-19 Vaccine

Both Egypt and China have a long history of cooperation and friendship. Before the outbreak of the Covid-19, the two countries’ relations were based on economic and trade cooperation, with China being Egypt’s first trading partner for the eighth year in a row since 2013, and the volume of trade exchange between the two countries exceeding $14.5 billion in 2020. However, as the outbreak Covid-19, cooperation between the two countries expanded to include medical cooperation. Egypt and China worked together to combat the virus. Egypt sent medical supplies to China, and China sent medical supplies and Chinese vaccine to Egypt. In addition, in December 2020, the two sides signed a cooperation agreement on COVID-19 Vaccine Production and China dispatched technical teams to Egypt to assist in the vaccine’s local manufacture. As a result, Egypt is considered Africa’s first vaccine manufacturer.

One Belt One Road Initiative  

Egypt is an important strategic partner in building the Belt and Road Initiative. According to CGTN, the Egyptian president, Abdel Fattah al- Sisi, stated that:” Egypt supports the Belt and Road Initiative(BRI).” He added that Egypt is ready to strengthen cooperation with China in the fields of economy, trade, industry, science and technology, and expand human exchanges within the framework of the “Belt and Road Initiative.” One Belt and One Road Initiative is one of the most important initiatives of the twenty-first century, announced by President Xi Jinping during official visits to Indonesia and Kazakhstan in 2013. Egypt was one of the first countries to participate in this initiative. In 2014, Egyptian President al-Sisi expressed in an interview that China’s One Belt and One Road Initiative was an “opportunity” for cooperation between China and Egypt. Egypt was willing to participate in it actively.

International and Regional Issues

Regarding the international and regional issues, the two sides exchanged views and coordinated positions on some issues as Palestine, Syria issues. It’s worth mentioning that Wang Yi paid a visit to Syria the day before his trip to Egypt, marking him the first Chinese official to visit Syria since the country’s civil war began. China supports the Syrian sovereignty and rejects foreign interference in Syria, and also rejects the regime change. The Egyptian Minister Sameh Shoukry also discussed with his Chinese counterpart Wang Yi the GERD issue. According to Sky News, Shoukry explained Egypt and Sudan’s positions as two downstream countries, the importance of preserving the interests of all parties and not jeopardizing the downstream countries’ water security, and the importance of engaging in intensified negotiations under the auspices of the African Union presidency. The two sides signed an agreement on the Egyptian-Sino Intergovernmental Cooperation Committee at the end of their meeting.

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Greater Middle East may force China to project military power sooner rather than later

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China may have no short-term interest in contributing to guaranteeing security in parts of a swath of land stretching from Central Asia to the East coast of Africa, but that does not prevent the People’s Republic from preparing for a time when it may wish to build on long-standing political and military relationships in various parts of the world to project power and maintain an economic advantage.

Determined to exploit the principle of allegedly win-win relationships that are underwritten by economics, trade, and investment as the solution to problems, China has so far delayed if not avoided bilateral or unilateral political and military engagement in conflicts beyond its borders.

The question is how long it can continue to do so.

China took a first baby step towards greater power projection with the creation in 2017 of its first overseas military base in the East African state of Djibouti, a rent-a-base nation that hosts multiple military facilities for among others the United States, France, and Japan and potentially Saudi Arabia. The base signals the importance China attributes to regions like the Gulf and the Horn of Africa.

A recent article in a Chinese military publication sheds further light on Chinese preparations for a day when it may have to project military might in different parts of the world. The article laid out Chinese thinking about the virtues of offering Middle Eastern, Asian, and African militaries and political elites training and educational opportunities.

“Students who can study in China are mostly local military and political elites or descendants of notable families. After they have studied and returned to their country, they have a high probability of becoming the top military and political leaders of the local country. This is very beneficial for China to expand its overseas influence and corresponding armaments exports,” the publication, Military Express, said.

The publication asserted that Chinese military academies were more attractive than their Western counterparts that impose “political conditions,” a reference to students having to hail from countries aligned with the West.

“Chinese military academy does a better job in this regard. There are no political conditions attached here. Foreign military students here learn Chinese strategies and tactics and learn to operate Chinese weaponry by themselves,” the publication said.

The publication failed to mention that China unlike Western producers also refrains from attaching political conditions to its arms sales like adherence to human rights.

Recent months have not been necessarily kind to Chinese aspirations of remaining aloof to conflict beyond its borders, suggesting that reality on the ground could complicate China’s strategic calculations.

The US withdrawal from Afghanistan threatens to put an ultra-conservative religious regime in power on the border with Xinjiang, the north-western province where China is attempting to brutally Sinicize Turkic ethnic and religious identity.

Recent Taliban military advances have already bolstered ultra-conservative religious sentiment in neighbouring Pakistan that celebrates the group as heroes whose success enhances the chances for austere religious rule in the world’s second-most populous Muslim-majority state.

Our jihadis will be emboldened. They will say that ‘if America can be beaten, what is the Pakistan army to stand in our way?’” said a senior Pakistani official.

Nine Chinese nationals were killed last week in an explosion on a bus transporting Chinese workers to the construction site of a dam in the northern mountains of Pakistan, a region more prone to attacks by religious militants than Baloch nationalists, who operate from the province of Balochistan and are responsible for the bulk of attacks on Chinese targets in the South Asian nation.

It was the highest loss of life of Chinese citizens in recent years in Pakistan, the largest recipient of Chinese Belt and Road-related infrastructure and energy investments. China’s sees Pakistan as a key to the economic development of Xinjiang and part of its effort to Sinicize the region.

Indicating Chinese concern, China last month advised its citizens to leave Afghanistan and last week evacuated 210 Chinese nationals on a chartered flight. China last week delayed the signing of a framework agreement on industrial cooperation that would have accelerated implementation of projects that are part of the China Pakistan Economic Corridor (CPEC).

Complicating Chinese calculations is the fact that both Russia and Turkey are maneuvering for different reasons to strengthen Turkic identity in the Caucasus that potentially would be more sympathetic to the plight of the Uighurs and other Turkic Muslims.

Turkey moreover may see Afghanistan as another stepping stone towards recreating a Turkic world. Turkey has reportedly asked Azerbaijan, whom Ankara supported in last year’s Caucasus war against Armenia, to contribute forces to a Turkish contingent that would remain in Afghanistan after the US and NATO withdrawal to secure Kabul’s Hamid Karzai International Airport.

Turkish influence among Afghanistan’s Turkic minorities has been bolstered by the operation of Turkish schools, an increased number of Turkish scholarships, training of Afghan military and police personnel, the popularity of Turkish movies and television series, and efforts to mediate an end to conflict in the country.

The Taliban have rejected the continuation of a Turkish military presence that for the past six years was part of the NATO-led Resolute Support Mission. The Taliban insisted that Turkish soldiers were “occupiers in Afghanistan” who should leave with NATO and US forces even if they were also representatives of a “great Islamic nation.”

In anticipation of a threatening development in Afghanistan, China quietly established a small military post in 2019 in the highlands of Tajikistan, a stone’s throw from where Afghanistan’s Wakhan Corridor meets Xinjiang.

More recently, Chinese Foreign Minister Wang Ji advised his interlocutors during a visit last week to Central Asia that going forward Chinese private military companies would play a greater role in securing Belt and Road-related strategic infrastructure projects.

Some analysts suggested that the Chinese companies would also be employed to train Central Asian militaries – a domain that was until now largely a Russian preserve.

In a similar vein, France’s withdrawal of its forces from West Africa steps up pressure on China to defend its overseas nationals and interests. Three Chinese construction workers were among five foreigners kidnapped by gunmen this weekend in southern Mali. No group has so far claimed responsibility for the kidnapping.

All of this leaves aside the question of how long China will feel that it can rely on the US defence umbrella in the Gulf to secure the flow of energy and much of its trade against the backdrop of a reconfigured US regional commitment and increasingly strained relations between Washington and Beijing.

It also does not consider China’s ability to manage expectations of the People’s Republic’s willingness to engage, in some cases not only politically or militarily, but also economically.

That was evident during Mr. Wang’s most recent visit to the region, and particularly Syria, which for much of its civil war was home to Uighur jihadists who distinguished themselves in battle.

It was Mr. Wang’s second visit to the Middle East and North Africa in four months. Furthermore, Mr. Wang last week discussed Afghanistan and Gulf security with his Saudi counterpart on the sideline of  a regional cooperation meeting in Uzbekistan.

Syrian officials have for domestic and foreign policy reasons long touted China as the imaginary white knight that would come to the rescue in the reconstruction of the war-ravaged country.

China is far less interested in Syria than Syria is in China… Syria has never been a priority in China’s economy-driven approach to the Middle East,” noted scholars Andrea Ghiselli and Mohammed Al-Sudairi.

The scholars cautioned however that “the significant potential impact of narratives created by local actors in the context of international politics,” a reference to Syria’s projection of China as its saviour, cannot be ignored.

Implicit in the scholars’ conclusion is the notion that Chinese policy may in future increasingly be shaped as much by decision-making in Beijing as developments on the ground in a world in which powers compete to secure their interest and place in a new world order.

Ultimately, the fundamental question underlying all these push factors is, according to Financial Times columnist Gideon Rahman, whether China has not only the capability and aspiration to become a superpower but also the will.

“If China is unwilling or unable to achieve a global military presence that rivals that of the US, it may have to find a new way of being a superpower – or give up on the ambition,” Mr. Rahman argues.

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