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Sino-Indian tensions

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China and India- the world’s two most populous nations comprise more than one-third of global humanity. Memories of border battles — the most recent in 1962 — fester, and the 4,000-km frontier, which cuts through disputed territory, remains tense.

They share a border, have fought a bitter war and continue to compete for geopolitical supremacy in the region. Political ambitions and distrust on either side have sometimes been at the cost of better economic sense.

Both have a long and chequered history dating back thousands of years. The two neighbours fought a short border war in 1962 and since then, although much water has flowed down the Yangtze, a sense of mistrust has consistently dogged their bilateral ties. Both are shy of each other.

On the positive side, India has been cooperating with China in many areas. It was one of the first countries to join the China-led Asian Infrastructure Investment Bank. Besides, India and China are part of the BRICS, along with Brazil, Russia and South Africa. They have also teamed up at global forums on climate change to resist demands from developed nations to agree to binding emission cuts. China and India, however, fear that agreeing to binding emission cuts would force them to jettison their ambitious growth targets.

New Delhi is loath to take on Beijing directly. This is seen in the recent case of India cancelling the visa issued earlier to a Uighur activist, Dolkun Isa, the Executive Committee Chairman of the World Uyghur Congress to attend a conference in India. The granting of the visa to the Uighur activist was seen as New Delhi’s riposte to being snubbed by Beijing on the Masood Azhar issue. t has shown that New Delhi is wary of upsetting Beijing, especially given its enormous clout at international forums as a permanent Security Council member and NSG entry- both China has blocked.

India and China jointly occupy parts of Jammu Kashmir along with Pakistan. India now asks Pakistan to vacate and hand over Azad Kashmir to India but it has not asked China also do the same. The reason is obvious. In fact, it was Pakistan which always demanded Kashmir region from Indian occupied Jammu Kashmir while India refused to budge and in order to retain Kashmir India even fought war with Pakistan, leading to the creation of LOC. India first acquired nukes followed later by Pakistan, further complicating the tensed situation in the region and bilateral relations between India and Pakistan.

A UN veto member China is possibly the largest global economy while as largest South Asian regional economy India tries to somehow catch the distance. Between Beijing and New Delhi, nonstop flights only run three times a week. There is not a single direct flight between two of Asia’s financial capitals, Shanghai and Mumbai. In 2013, 175,000 Chinese went on holiday in India. Thailand, meanwhile, attracted 4.6 million Chinese visitors in 2014.

Tensions

The Indian government recently has expelled three journalists of the Chinese official news agency, Xinhua. This is the first time for New Delhi to expel Chinese journalists that could kick off a diplomatic row between China and India.

India’s military buildup near Chinese border also shows that the situation has become a tinderbox. It has been revealed that the Indian Army has moved over 100 Russian tanks T-72 to Ladakh, a disputed border between Indian occupied state of Kashmir and Tibet under Chinese rule. Both countries are preparing for the worst situation they could face in the midst of deteriorating relations. In addition, Indian Navy has sent three warships to the disputed South China Sea to plan training with Malaysian Navy, showing that there’s nothing strange with seeing any military conflicts between the two countries.

India thinks it should be on the UNSC with veto handle to control the world and is annoyed that China has not supported India’s pitch for permanent membership of the UNSC (United Nations Security Council) and is the only one of the P5 members trying to stymie India’s bid. Sparks flew when in the days leading up to India’s second round of nuclear tests in May 1998, the then Indian defence minister George Fernandes, termed Beijing as India’s “potential enemy No 1” worse than Pakistan or USA.

The stumbling blocks between India and China are hard to budge. China’s historic friendship with Pakistan hasn’t helped, nor has India’s decades-long hosting of the Dalai Lama, the exiled Tibetan spiritual leader living in India newly sworn in PM Modi invited to his inauguration in 2014. Then there are other issues too working against any credible ties to which NSG issue has been added last year to sustain the bilateral tensions. India seeks membership of NSG without signing the NPT. USA just pretends as a “terror victim” and strategic partner against terror wars, it promotes Indian interests in nuclear domains.

In recent years there have been attempts to mend and strengthen the relationship through bilateral visits from both heads of state. And while Indian manufacturers, like their counterparts elsewhere, complain about inexpensive Chinese products flooding the market, Indian consumers are lapping up everything from cheap Chinese phones and toys to clothes made in China.

India’s military buildup near Chinese border also shows that the situation has become a tinderbox. It has been revealed that the Indian Army has moved over 100 Russian tanks T-72 to Ladakh, a disputed border between Indian occupied state of Kashmir and Tibet under Chinese rule. Both countries are preparing for the worst situation they could face in the midst of deteriorating relations. In addition, Indian Navy has sent three warships to the disputed South China Sea to plan training with Malaysian Navy, showing that there’s nothing strange with seeing any military conflicts between the two countries.

The Indian government recently has expelled three journalists of the Chinese official news agency, Xinhua. This is the first time for New Delhi to expel Chinese journalists that could kick off a diplomatic row between China and India.

Fruitless effort

Narendra Modi made his first visit to China as Prime Minister of India in May 2014. One of his first stops will be the Wild Goose Pagoda in the central Chinese city of Xi’an, which, legend has it, was originally built to store first Chinese pilgrim to India in 7th Century Xuanzang’s Buddhist treasures from India.

Much before he became India’s prime minister, Narendra Modi was already a self-professed admirer of China. “China and its people have a special place in my heart,” Modi said in 2011 while he was on his fourth visit to the country as the Gujarat chief minister. “I admire their hard working, disciplined and resilient nature and above all, their sense of history.”

So, after he took control of the government in New Delhi last May, Modi wasted little time to try and strengthen ties with Beijing. Within days of taking office, he promptly invited Chinese president Xi Jinping to India. But by the time Xi arrived in September, the tricky nature of the India-China relationship was in full display: The Chinese president conducted a state visit in India while troops from both countries squared off in Ladakh.

Though relations between these two Asian behemoths warmed up in the aftermath of the visit of the Chinese President Xi Jinping to India in September 2014 and the visit of the Indian Prime Minister Narendra Modi to China in May 2015, the relations have once again hurtled downhill as they pursue their respective foreign policy agendas. Mutual trips by Indo-China leaders therefore have not been able to improve the tensed relations.

Through the “Maritime Silk Road” initiative, China has been trying to reach out to countries such as Sri Lanka and Maldives, right in India’s immediate neighborhood. Besides, of late, relations between China and Nepal have warmed up, particularly in the aftermath of the visit to Beijing by the Nepalese Prime Minister Khadga Prasad Sharma Oli. Although China has asked India to be part of the Maritime Silk Road, New Delhi is in two minds over whether to join owing to the suspicion of India and other nations. Moreover, China put a “technical hold” over India’s attempts to designate the Jaish-e-Mohammed chief, Maulana Masood Azhar, as a terrorist since New Delhi views him to be the mastermind behind a host of terror attacks in India, with the most recent being the Pathankot terror attacks in early January this year.

China accused Modi of “playing little tricks” over border disputes and security issues, hoping to boost his domestic prestige while increasing his leverage in negotiations with China and went on to criticize the Indian elites’ blind arrogance and confidence in their corrupt democracy, as well as “the inferiority of India’s ordinary people.”

Political economy

China is India’s largest trading partner and like with many other countries, this relationship too is imbalanced. Trade between the two countries has been expanding annually at 15 percent since 2007. The bilateral trade between the two countries stood at $70.4bn last year with India reeling under a huge trade deficit of $52.67bn. Unfortunately for India, so has its trade deficit with China. In the financial year 2016 that ended March 31, India exported a little over $9 billion worth of goods to China, while it imported goods worth $61.7 billion, taking the trade deficit to a whopping $52.7 billion. Therefore trade experts said India’s dependence on China for export oriented growth is limited.

India mainly exports raw materials to China such as cotton and copper and as the Chinese economy rebalances to become more consumer led, there will be a further fall in exports. This is evident from the 2015-2016 figures that show Indian exports to China fell by over 24 percent.. China is a huge market for Ayurvedic and agro products and IT services India is eager to expand there in a big way.

The bilateral trade hovers around $70 billion, less than half the dollar figure of commercial ties between China and Australia. When President Xi visited India last September, the trip was hailed as groundbreaking — the first time a Chinese President had stepped on Indian soil in eight years. Yet Xi’s visit resulted in an underwhelming $20 billion in promised Chinese investment over a five-year period. By contrast, Xi vowed $46 billion in infrastructure spending for ally Pakistan during a trip there last month. As Xi was in India, the Chinese People’s Liberation Army reportedly dispatched hundreds of soldiers past the Line of Actual Control to a remote section of the India-China frontier.

Over the past 13 years, 142 Chinese companies have invested a total of $27 billion in India in sectors such as automotive parts and consumer electronics, according to CII. Top Chinese companies investing in India include Huawei Telecommunications, ZTE, Alibaba and Xiaomi. During the same period, 139 Indian companies have invested $12 billion in China, largely in the software and Information technology (IT) services sector. Many small manufacturers are sourcing products as diverse as firecrackers and religious idols from China. During Indian PM Narendra Modi’s visit to China, 24 agreements worth $22 billion were signed between Indian and Chinese companies to finance and invest in projects across sectors.

Meanwhile, China’s relations with its “all-weather friend” Pakistan are at an all-time high, with Beijing announcing that it will invest $46bn in the China-Pakistan Economic Corridor, which will connect Kashgar in China’s Xinjiang province with the port of Gwadar in Pakistan.

Large Indian firms have traditionally been more interested in looking for mergers and acquisition in the West rather than investing in China. Dependence on China to fund the budget deficit is far more limited compared to some global peers. India’s total external borrowing as of the end of 2015 stood at $480 billion and the share of sovereign debt was just 19 percent with the rest made up of commercial borrowings and nonresident Indian deposits, according to government data.

Tourism is an area of cooperation and many Buddhists from China come to India while visiting the birthplace in neighboring Nepal of Shakyamuni Buddha, the founder of the religion.

American link

The relations between China and India are worsening rapidly as India supports US pivot in Asia against China. Unless the situation changes dramatically, the two countries could even go through armed conflict against each other. It would be no strange thing if this really happens, because they really went through armed conflict due to Sino-Indian border dispute in the early 1960s.

Part of the reason for the growing bonhomie between India and the USA is China’s growing belligerence. India and the USA say they have a common interest in ensuring the safety and security of the sea lanes of communication in the Indo-Pacific region which was reflected in the joint statement released by the two sides during the visit of the US President Barack Obama to India in January last year.

And under Modi, India has slowly, but surely, moved away from its traditional stance of non-alignment to multi-alignment. He has given a vigorous push to India’s “Act-East Policy” which aims at improving India’s ties with its neighbours in Southeast and East Asia. His first visit outside the Indian subcontinent after taking charge was to Japan, which has seen frayed ties with Beijing, of late.

The US-India Joint Statement notes that they “affirm the importance of safe-guarding maritime security and ensuring freedom of navigation and over flight throughout the region, especially in the South China Sea.”

Chinese leadership advocates free trade, while US President-elect Donald Trump and his team appear committed to carrying out an economic policy based on protectionism. Trump has repeatedly blamed free trade agreements for damaging the US economy. The US president-elect has announced that he will withdraw from the controversial Trans-Pacific Partnership (TPP)

Chinese President Xi Jinping warned Trump and any other country intent on pursuing protectionism against such policies in a speech at the World Economic Forum held in Davos, Switzerland. He compared such efforts to attempts to “divert a river into lakes and creeks” and said that it was not possible.

China will be hit the hardest if countries hide behind trade barriers and if globalization is seen as the root cause of all evil. While the shadow of a credit bubble looms large over its economy, China, driven by a low-wage, enormous workforce, has become the global factory for low-cost products which it badly needs to market. It must have noted Donald Trump’s protectionist rhetoric with horror.

Observation

The reason behind such confrontation between the two countries is not complicated. First, their disputed borders are the major cause of tensions between them. They even had a war against each other 50 years ago, but failed to make any progress on the border dispute. Besides, the gap between the positions of China and India over Tibet is wide. While China sees Tibet as one of its local governments, India sees it as a government in exile.

Other reasons such as China’s expanding footprint in Nepal and its ambition to keep Southeast Asia under its control are also driving the bilateral relationship to the gate of armed conflict. Perhaps, the relations between the two countries should pass the crisis in order to find a string of efforts for normalization.

The bilateral relationship cannot be very good unless the border dispute is solved. Yes, not just that. In order to facilitate the bilateral ties on a large scale, India has to solve the Kashmir issue as Kashmir nation lies between India and China.

China’s has opposed India’s entry into the 48-member grouping, which is one of the irritants in Sino-India ties. China on January 16 warned India’s entry into the Nuclear Suppliers Group (NSG) cannot be a “farewell gift” to the outgoing US President Barack Obama. Beijing’s reaction came after US Assistant Secretary of State for South and Central Asia Nisha Desai Biswal of Indian origin described China as an “outlier” in the process of letting India joining the nuclear trade bloc. “Regarding India’s application to the Nuclear Suppliers Group, regarding non-NPT countries admission to the NSG, we have made our position clear before so I will not repeat it,” Chinese Foreign Ministry spokesperson Hua Chunying said here. “I just want to point out that NSG membership shall not be some kind of farewell gift for countries to give to each other,” Hua said, obliquely referring to Obama who will be succeeded by Donald J. Trump. The US government, under Obama, has strongly backed India’s membership in the NSG, which regulates the global nuclear trade. Beijing objects to New Delhi’s inclusion in the bloc, citing rules that India’s non-signatory status to the nuclear non-proliferation treaty.

While it is unlikely that India will be a part of any Western-led attempts to bandwagon against Beijing any time soon, it also wants to ensure that Beijing does not seize the initiative in India’s backyard.

Of course, China is also preparing for the worst. According to military sources in Beijing, China has deployed more troop along the India border, showing off its will to respond immediately if the worst really happens.

India cannot take the foreign cricketers and badminton or other sports/entertainments coming to play joint sport exercises as a victory for foreign policy, after all, they come to play for money and they are trained to do exactly what the sponsors expect and the mafias want. Don’t the English cricketers now do exactly what Indian sponsors and government agencies want? Governments promote their sportsmen also to be top billionaires by all possible means.

India requires prudence and pragmatism in dealing with countries with different economic and political systems, like China and Pakistan, while core media in the country should shed extra elements of arrogance and over confidence.

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East Asia

Twists and Turns in US -China Trade War

Gen. Shashi Asthana

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US Secretary of State Mike Pompeo’s stopover at Beijing on 08 October may not have been a pleasant experience, more so in the backdrop of accusation of US Vice President Pence about  China attempting to interfere in U.S. elections. The agenda of North Korean denuclearisation, where US and China were broadly agreeing earlier, seems to have taken a back seat, and improvement of relations doesn’t seem to be realistic in near future. The ongoing trade war continues as both sides dig their heels despite being the biggest trading partners of each other, because it is also linked with global dominance, strategic and military posturing, diplomatic and information offensive.

 China Braving Threat to its Vulnerabilities

China is putting a brave front despite being badly hit at some of its most vulnerable spots in the tit-for-tat trade war with both sides spiralling the slapping of tariffs on a wide range of each others’ trade items. Taiwan, which is another sensitivity of Beijing is witnessing visit of US officials after Taiwan Travel Act was signed by President Trump, with a promise to arm it further with latest weaponry. US continued military posturing in South China Sea, along with the appearance of UK warship ignoring Chinese repeated warning is another concern.   A recent injection of over $110 billion by China into its banks and hardly any financial benefits coming out of BRI partners incapable to repay anything is tightening its financial freedom for global dominance. Some of its BRI partners want to get out of the ‘Debt Trap’ by refusing/reducing Chinese investments is adversely affecting Chinese dream project (BRI), after five years of its announcement like Philippines.

Not a Smooth Sail for US

US on the other hand cannot be celebrating either, with China digging it heals and refusing to give up either in trade war or South China Sea. On North Korean front, the policy of good optics continues with Kim managing to get a lot of goodies from South Korea (presumably at their cost), during the last summit of North and South Korea. Kim in fact has been an outright winner, managing to get another Summit with President Trump, which helps him in convincing his countrymen of his sound leadership, as well as boosting his status internationally. US sanctions on paper continue, but after the chest thumping at Singapore Summit, his friends like China automatically relaxed the sanctions on North Korea, without any worthwhile denuclearisation/reduction in his nuclear/missile arsenal. US realises that knocking out China financially is the key to its global dominance; hence is unlikely to soften up to China. US also faces another challenge of keeping its allies like Japan and South Korea satisfied while negotiating with North Korea and asking ASEAN to make choices of partners, besides continuing with CAATSA hurting some of its strategic partners who could be helpful in balancing China.

It will take some time to see that whoever has greater resilience to withstand the economic stand-off and appetite to take setbacks will have an upper edge, which seems to be US at this point of time. As per IMF assessment, China’s GDP size will be 1.6 per cent lower in 2019 than it otherwise would be, if the US slaps tariffs on all Chinese imports.

How is India affected?

The Indian economy has survived some global slowdowns earlier and should be able to sail through the present one. The bigger problem is the sanction under CAATSA in dealing with Russia for urgently needed military hardware like S-400 and Iran for cheaper crude oil being paid in rupee terms, for which India has adequate refineries. The US option of buying shale oil does not suit India as it does not have adequate refineries and will have to purchase finished product in dollar terms. The port of Chabahar is also crucial for India for connectivity to Afghanistan and CAR. The silver lining is that US being our strategic partner will like to have well equipped Indian Forces to balance China and Indian connectivity to Afghanistan, in case Pakistan does not serve their strategic interest. On both counts I am hopeful that US will find a way out not to hurt its strategic partner.

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East Asia

The talks held in September 2018 between Kim Jong-Un and Moon Jae-In

Giancarlo Elia Valori

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In less than one year three meetings have been held between the North Korean Leader and the South Korean President, Moon Jae-In.

In the initial meeting the two leaders had decided to put an end to the state of war between their two countries. They had also reaffirmed the goal of denuclearization of the entire peninsula, with the consequent destruction of the nuclear potential of South Korea and of the United States, in particular. They also decided to create an inter-Korean Liason Office between the two sides of the Demilitarized Zone and to bring together the families dispersed between the two Koreas. Finally, the idea was to create new communication infrastructure – railway lines, in particular – a project by which Russia has always set great store.

Indeed, Russia is betting many of its cards on a reunification between the two Koreas, capable of enabling it to keep its excellent relations with South Korea – which are essential for the economy – and to also support North Korea, which is Russia’s unavoidable strategic goal.

Now the two Koreas are dealing on their own, without the US brokerage and intermediation with respect to South Korea, although President Donald J. Trump has recently stated that President Moon Jae-In is his official “delegate” for the denuclearization of the Korean peninsula.

The United States is scarcely interested in the internationalization of the North Korean economy. It only wants denuclearization, while Kim Jong-Un wants denuclearization to develop his country’s economy and maintain its geopolitical and national autonomy.

A serious problem – both in talks and in the final or working documents – is also to define an effective mechanism to check denuclearization.

Indeed, between September 17 and 19, 2018, the signing of the Joint Declaration of Pyongyang has not fully clarified the mechanism of checks on the denuclearization of the Korean peninsula. Kim Jong-Un’s idea is to organise these checks with a series of “experts” appointed by the friendly powers, while the South Korean idea is to accept the maximum possible denuclearization to start the long process of reunification.

The two respective Defence Ministers, however -namely Song Young Moo for South Korea and Rho Kwang Chul for North Korea – have just signed a separate document from the rest of agreements.

In that text confidence-building measures between the parties are put first, with North Korea’s acceptance of dismantling a launch pad and a site for checking jet engines, with the presence of yet unspecified, but friendly international experts. From IAEA? We have some doubts, in this case.

Subsequently North Korea could also dismantle the Nongbyon site, if the United States does the same in South Korea.

It should also be recalled that most North Korean missiles are built to be launched by mobile vehicles, not from fixed bases.

In short, North Korea wants the United States to remove the nuclear umbrella protecting South Korea and Japan while, in the recent talks with North Korea, the United States thinks of a bilateral treaty regarding only the Korean peninsula and, at most, some classes of North Korean missiles.

In the US mind, the planned reduction of North Korean long-range missiles could be even equivalent to a nuclear and conventional decrease of its troops stationed in Guam.

On the basis of a new future agreement, both Koreas (and God only knows how and to what extent the North Korean conventional military potential would be useful for a South Korea unified with North Korea) would also define maritime and land buffer zones, as well as a no-fly zone over the old border, with a view to avoiding clashes or accidental air battles.

This is already partially clear, but much work shall be done to define all the details.

There would also be plans to cover or reduce artillery batteries along the coast.

Obviously, should these talks run aground, the only concrete political result would be the progressive divergence between South Korea and the United States, precisely on the problem of the peninsula’s denuclearization.

Furthermore, over and above the aforementioned sites, North Korea will dismantle the site of Dongchang-ri, in addition to the site of Yongbyon, while Kim Jong-Un is also very interested in the building of fast railway links between South and North Korea.

The two Koreas will get the industrial site of Kaesong back in shape and the old tourist project concerning Mount Kumgang back in track, besides planning new joint economic and tourist areas.

The inter-Korean agreement regards also collaboration for medical and environmental issues, as well as for the protection from epidemics.

In other words, both Koreas think of an economy of compensation between them, which could also develop at a later stage and become a need for the development of both countries.

An economic-political symbiosis that could get the United States out of play and later reinstate Russia, which is increasingly interested in the South Korean economy, as well as finally favour China, which has no intention of leaving the Korean peninsula to the hegemony of North Korea alone.

At the end of the Treaty, there is also the project of a joint participation in the Tokyo 2020 Olympic Games and a joint candidature for the 2032 Olympics.

A few days ago, North Korea also expressed its intention to join the International Monetary Fund and the World Bank – a sign that the internationalization of the North Korean economy is now a certainty.

Hence it is a de facto peace treaty between the two Koreas.

If North Korea continues along this line, it is very likely that South Korea will gain a tactical advantage over the sea while, if the relations between South Korea and the United States remain as they currently are, there should be no significant changes in bilateral relations between the USA and South Korea.

However, what is the current state of relations between the United States and North Korea?

In fact, while the inter-Korean relations are all in the framework of effective confidence-building measures, the clear purpose of the fourth round of talks between the two Korean leaders is to preserve a strong US engagement in the whole negotiation process.

Kim Jong-Un wants to engage the United States for his global economic projection and he certainly does not want to remain tied to a regional economy, albeit open and “reformed” according to China’s rules.

For North Korea, the procedure is simple: at first, bilateral talks with the US support for South Korea; later peace between the two Koreas and finally what is only interesting for the USA, namely denuclearization.

It is not even unlikely that the United States does not accept this timing, but it is also unlikely that it realizes the strategic and economic aspects of this timing.

North Korea wants a fundamental agreement with South Korea because: a) it is an unavoidable asset for the modernization of its economy; b) it is the fundamental strategic factor to have the support of both Russia and China, who want to avoid North Korea’s hegemony over the peninsula, but also want to keep it as a rampart for US forces in South Korea; c) it is only through South Korea that North Korea will eventually be in a position to be connected to the Chinese maritime economic and strategic system and reach up to the Mediterranean.

In fact, if the relations between the United States and North Korea improve further, the site of Yongbyon could be dismantled definitively.

Hence currently Kim Jong-Un wants to thoroughly test the US goodwill, rather than South Korea’s goodwill, in developing a long or very long-term peace policy.

In Kim Jong-Un’s mind, there is in fact a key factor: the US behaviour in the phase in which Muammar Gaddafi accepted its proposal to dismantle his nuclear project.

Kim Jong-Un thinks that not even the story of Saddam Hussein is a guarantee for the US long-term reliability and for the stability of its leaders’ word of honour.

This is the real important factor in the strategy of the North Korean Leader.

Moreover, the US immediate reactions to the last meeting between the two Korean leaders have been fast and positive, both by President Trump and by Secretary of State Mike Pompeo.

And North Korea’s autonomous foreign policy has been seen also recently, with the 70th Anniversary military parade.

North Korea’s military parade and its important national celebration, was attended by Li Zhansu, ranking third in the internal power hierarchy of the Communist Party of China (CPC); by Valentina Matviyenko, President of the Russian Federal Council, the third elected office in the Russian Federation; by a very significant figure, Mohamed Ould Abdel Aziz, President of Mauritania, and finally by Hilal al Hilal, deputy-General Secretary of the Syrian Baath Party.

With peace, North Korea will significantly develop its already multiple economic and political relations with Africa, which will be essential for its new economic development.

At the military parade staged on September 9, there were also authorities from Iran, South Africa and Singapore – which is the never forgotten model of the Chinese “Four Modernizations” -as well as other 60 delegations from “friendly” countries.

At economic level, in August, shortly before the big military parade of the 70th Anniversary, there was the International Fair of Razon, which hosted as many as 114 companies of which 52 North Korean ones.

The North Korean product lines mainly included pharmaceuticals, foodstuffs, textiles, electronics and cosmetics.

However, there were many Chinese large companies selling their products in North Korea despite the UN sanctions.

As from September 17, there was also the Autumn Fair which brought together 320 commercial companies from Russia, New Zealand, Australia and China.

This is in fact the new paradigm of North Korea’s foreign policy.

The dollar has also grown in the exchanges with the North Korean currency, both on the official and on the “parallel” markets.

If all goes well at geopolitical level, the North Korean project will be to further improve its light industry, in addition to the diversification and quantity of products, with a view to trying its own autonomous way on the market world, as was the way of the nuclear system.

It should be recalled that this was also Kim Il-Sung’s project.

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China’s Imprint underneath the Pyongyang Joint Declaration

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On September 18, the leaders of two Koreas met each other in Pyongyang, the capital of the DPRK. The world media focused on the meeting during which the two sides issued the “Pyongyang Joint Declaration”. If we see the Panmunjom Declaration serving as the cornerstone of the dialogue between two Korea, it is necessary to say that this joint declaration took a substantial step to the denuclearization of the Korean peninsula that is vital to the regional peace and beyond.

Literally speaking, the Pyongyang joint declaration highlighted the key issues as follows. First, both sides are determined to achieve the denuclearization of the Korean peninsula. Second, they will work together to improve their relations with a view to the existing state of war, as the defense chiefs from the DPRK and ROK earlier signed a comprehensive agreement aiming to reduce tensions on the peninsula. Third, they will promote the peace talk process of the Korean peninsula. Given that Kim pledged to work toward the “complete denuclearization of the Korean Peninsula”, it would be seen as a political declaration that would mark a starting point for peace negotiations. If all goes well, a peace treaty would be sealed and then comes normalization of DPRK-US relations after it achieves complete denuclearization.

As a close neighbor to the Korean Peninsula, China always supports the DPRK and ROK as well in improving their relations through dialogue and consultation and promoting reconciliation and cooperation. This is the consistent and persistent position of Beijing, which has been playing a responsible role in politically resolving the Korean Peninsula issue and achieving the long-standing peace of the region.

In effect, prior to the leaders of two Korea met each other this week in Pyongyang, they have closely contacted their respective allies or strategic partners. Among them is China, dealing with both sides – Pyongyang and Seoul – in a unique way. It is true that China is the largest trading partner of the ROK while it is equally the only legal ally of the DPRK as well as its largest ideological partner now. If we review the bilateral relations between China and North Korea since last March, Kim Jr. has paid three significant, though unofficial, visits to President Xi of China. For example, during his March 25-28 visit, both sides vowed to continue their traditional solidarity in terms of their shared ideologies and common strategic interests. Xi especially proposed to strengthen the close ties between the two ruling parties. As he said to Kim, “party-to-party and state-to-state relations are the common treasure to both sides. And safeguarding, consolidating and developing China – DPRK relations are unswerving guidelines for China’s foreign policy and security strategy.

During his second meeting with Xi in Dalian summer resort, Kim vowed to terminate all the nuclear tests and to follow denuclearization if the United States took corresponding measures with good wishes. Then following his meeting with Trump in Singapore on June 12, Kim came to Beijing again on 19 to meet his Chinese counterpart. Xi confirmed China’s “3-no change” policy towards the DPRK, that is, political solidarity between the two parties remains unchanged, the friendship between the two peoples remains unchanged, and China’s support of a socialist Korea remains unchanged. Essentially, they serve as the foundation of the strategic consensus between Beijing and Pyongyang. In return, Kim reiterated his permanent shutdown of all nuclear tests and facilities if the US would respond sincerely and responsibly.

Given all the analysis above, it is understandable to conclude that China’s long-standing adherence to the goal of denuclearization of the Peninsula through dialogue and consultation is fully reflected in the Pyongyang Declaration. Meanwhile, China’s stance remains evident since it claims that the Korean issue must be resolved eventually by the Korean people rather than any external power. Therefore, peace not force is the only acceptable way. Also, as China and Russia have repeated that no coercive change of the regime by outside power is tolerated, North Korea can be confident and comfortable to proceed the permanent shutdown of the missile engine test site with international experts observing; and then a complete denuclearization is not too far in the future.

Here is necessary to argue that China has never claimed to play an exclusive role in the Korean Peninsula. Instead of that, China has always encouraged the DPRK to talk to the United States and other relevant parties. Since Kim has agreed to make a trip to Seoul for further talks and to meet the US high-ranking officials in Pyongyang soon, the summit between Kim and Moon marks a leap forward toward peace.

Yet, as the lessons in history show, it is better to approach realistically the Korean issue simply because it has involved too complicated concerns and memories and the overlapped interests. Therefore, we should be ready to accept trial and challenges lying ahead. China has insisted on diplomacy which means that all parties concerned should be brought to the negotiating table under the mandate of the UN Security Council.

Now, Beijing has navigated the course of denuclearization proactively to protect two sides’ common core security stakes when Kim reportedly promised to give up his nuclear program if the United States and South Korea respond to his proposal with good will. Due to this reason, China will do what it can to help ensure “no change of regime by force and denuclearization at the same time in the Korean Peninsula”. This is China’s influence or Beijing’s imprint on the Korean denuclearization issue and the regional peace.

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