The COVID-19 pandemic is far from over, but the battle for “coronavirus narratives” is already in full swing. The front lines are the pages of newspapers and magazines, televisions screens and computer monitors, virtual seats at international organizations and online university lecture halls. Who is primarily to blame for the appearance of COVID-19? Which country and which system have been most effective in combatting the virus? Who has demonstrated the most compassion and empathy? Who has shown a willingness to selflessly help their foreign partners and even their strategic adversaries in the battle against the pandemic?
Common sense would suggest that it might be better to postpone any discussion of these and other similar issues until the global community has the spread of the virus under control. One way or another, victory over the coronavirus will be something that the global community can share. Let the epidemiologists, sociologists, political scientists, psychologists, economists and other experts argue about strategy and the offensive and defensive tactics that needed to be adopted on various fronts. But no! There has been no ceasefire in the “battle of narratives.” Nor is there likely to be one. What is more, one gets the distinct impression that more energy is being put into this battle than into the fight against the coronavirus itself.
But this is hardly surprising. Because right now, literally in front of our very eyes, national and transnational mythologemes of the fight against coronavirus are being created – mythologemes that may end up being just as important as those about World War II or the Cold War. Like the numerous narratives of the past, the narrative that is being created today does not have to reflect the true situation. In fact, it could be entirely false. What is most important here is that the elites are able to convince their own societies of the truth of their version, so that the narrative will be accepted, supported and passed on to future generations. And then its significance as an integral part of national identity and an instrument of political mobilization will be difficult to overestimate.
Whose Narrative is Most Convincing?
Sooner or later, every country that has been affected by the coronavirus pandemic will have developed its own narrative about the fight against COVID-19. There will be heroes, villains, noble feats and tragic mistakes. But the truly era-defining war of “coronavirus narratives” is currently unfolding between China and the West, headed by the United States. The side that can convince the world that its strategy for overcoming the coronavirus is the most effective will at the same time stake its claim to global leadership in the post-corona world. And the side that gives off the impression that it is helpless in the face of the pandemic or has been slow to react to it will automatically be relegated to the position of outsider – a country that will not be able to cope with the challenges awaiting us as we move deeper into the 21st century.
Right now, the West as a whole, and the United States in particular, have been forced to fight a number of difficult defensive battles in the war of “coronavirus narratives.” The public is constantly reminded that COVID-19 did not originate just anywhere, but in China, and hinting at the possibility that the virus was artificially created couldn’t hurt, right? Then there is the argument that Beijing actively misled the international community about the origin of COVID-19 and silenced the doctors who discovered it. And we can blame the Chinese leadership for its massive human rights violations at the peak of the disease in Wuhan, for trying to bribe WHO officials and for various other wrongdoings.
But, as the Russian saying goes, “the winners are not judged.” The statistics are on China’s side, not the United States’. As of April 22, 2020, China had registered a total of 88,423 coronavirus cases and 4632 deaths, compared to 790,480 cases in the United States and 42,214 deaths. China is the most populous country in the world, yet only eighth in terms of the number of infected, far behind the United States and several other Western countries (Spain, Italy, France, Germany and the United Kingdom). As a side note, it is worth mentioning that the spread of coronavirus in the West has forced many to abandon the previously held propagandist theory that the course of the pandemic in Iran was indisputable proof of the complete failure of the country’s illiberal system to deal with the epidemiological crisis. Today Iran, just like China, compares favourably with most leading countries in the West in terms of both the number of infected and the number of deaths.
The discouraging statistics for the West make it difficult to build a reliable defence against the Chinese “coronavirus narrative.” But the West, particularly the United States, desperately needs an alternative narrative. And now more so than ever, as the outlines of a post-corona bipolar world are coming into sight. Observing this epic battle of narratives from the outside (as Russia does not really have a dog in the fight at this point), we can see that the West is building three lines of defence.
China Can Never Be Trusted!
The first line of defence is to try and discredit China’s official coronavirus numbers. The West has always been sceptical about China’s statistics on just about anything, but now this traditional mistrust has turned into outright rejection. Many point to “indirect data” (for example, the sharp decrease in the number of mobile network subscribers in the country) as proof that the number of infected was not in the tens of thousands, but rather in the millions. It thus follows that the number of deaths is also an order of magnitude (or even two) higher than official reports suggest. Moreover, certain voices insist that China is on the verge of a secondary outbreak (which may happen as early as this autumn), and if this is the case, then we may have been a little hasty in praising the effectiveness of China’s strategy in fighting COVID-19.
How strong is this line of defence? The design looks flimsy and unreliable. Naturally, Beijing manipulated the statistics from time to time and the accuracy and completeness of official data on the pandemic are probably questionable. But surely only the most hardened Sinophobe would entertain the notion that the actual numbers of infected and dead are several times higher than the officially reported figures. The reality is that it is impossible to hide the real numbers in today’s transparent and interconnected world – even in a totalitarian and completely closed country like North Korea, not to mention China, which is deeply integrated into the global economic and political system. Attempts to destroy the Chinese narrative by reference to Xi Jinping’s statistical gymnastics can be likened to Lord Cardigan’s hopeless Charge of the Light Brigade on the fortified positions of Russian troops during the Crimean War.
It’s All Trump’s Fault!
The second line of defence is a classic example of ad hominem fallacy. That is, in this case, reducing all of the West’s problems in the fight against coronavirus to the subjective miscalculations of individual statesmen and politicians. The primary culprit is, of course, President of the United States Donald Trump, although fingers are certainly being pointed at European leaders too, from British Prime Minister Boris Johnson to his Spanish opposite number Pedro Sánchez. The basic premise is that western healthcare, just like the western socio-political system, is far more effective “in principle” than that of China. Unfortunately for the West, however, the countless managerial missteps of certain individuals and the inconsistencies brought about by the belief in their own infallibility have cancelled out any objective advantages that the West may have had over China. People in the West caught a “bad break” when, at a crucial moment in history, their leaders turned out to be wholly incapable of meeting the challenge before them.
There are gaping holes in the second line of defence as well. It is difficult to find a convincing argument that would explain why such different leaders (in terms of their political views, professional experience, management style and even age) have done about as poorly as each other in their response to the coronavirus in the United States, Spain, Italy, Germany and the United Kingdom. Let us not forget that the population of these countries is several times lower than that of China, yet the number of infected exceeds the Chinese figures significantly. If the Western political system continues to put incompetent and inadequate in positions of power, then perhaps the problem is not the people themselves, but the system as such!
Back to the Roots!
The third line of defence is the willingness to acknowledge the serious systemic imperfections of modern capitalism without touching upon the fundamental principles of political liberalism. In this case, it is not so much Donald Trump and Boris Johnson who are to blame, but rather Ronald Reagan and Margaret Thatcher. The argument here is that many Western countries made the fatal mistake in the late 1970s and early 1980s of privatizing numerous industries and stimulating economic inequality. What is more, the state started to reject its traditional social obligations. Not only did this result in the degradation of national healthcare systems, but it also led to increased social and political polarization and a general distrust of state institutions and of other people. This all came to a head when a real test in the form of the coronavirus appeared. For example, in the United States, not only did the Republicans and Democrats not rally together in the fight against the pandemic, but they also turned COVID-19 into another reason to step up interparty hostilities.
The conclusion can thus be made that, in order to successfully fight the pandemic and overcome the various other challenges that await humanity, the West needs to return to the historical fork in the road, as it were, where the wrong choice was made. The proponents of this argument point to the relatively successful strategy of the Scandinavian countries in fighting the coronavirus, where social interaction remains high, the state never abandoned its social obligations and the government, opposition, trade unions and employer associations have come together to fight the pandemic.
There is, of course, a logic to this approach. However, the first thing that we should point out here is that the success of the Scandinavian countries in fighting coronavirus has been mixed thus far. As of April 23, 2020, Finland had 3868 registered cases, with 98 deaths (2.5 per cent), compared to 14,777 and 1580 (10.5 per cent), respectively, in Sweden. This can hardly be seen as an unequivocal success for the Prime Minister of Sweden, Stefan Löfven. Secondly, some doubt if the Scandinavian models of the social state can be interpreted as a consistent implementation of “true capitalism at all.”
What if the Defence Falls?
As we can see, holding these lines of defence requires huge resources and casualties from the West. At the first line of defence, the question simply comes down to increasing the effectiveness of propaganda and counterpropaganda and enhancing the West’s intelligence and analytical potential in the name of winning the information war against Beijing. At the second line of defence, at least some of today’s leaders, as well as members of their inner circles, will need to go. And holding the third line of defence will take more than simply removing individual figures from the political scene, no matter how influential they may be. Substantial reforms of the political and socio-economic models of leading Western nations are what is needed here, with all the costs that this will entail for the current elites.
Let us say that there is enough determination and political will in the West to make these sacrifices. Will this be enough to guarantee victory over China in the “battle of narratives”? And what if the third line of defence is breached? Such a breach would represent a direct or indirect acknowledgement that the relative failures of the West and the relative successes of China in the fight against coronavirus are not down to Beijing manipulating the statistics, the inferiority of certain leaders in the West or the departure of leading Western countries from the traditional foundations of the capitalist system.
The failure of the third line of defence would demonstrate that the failures of the West are rooted in the very principles of political liberalism, which is losing all credibility in front of our very eyes through its inability to respond in an effective manner to the challenges of the 21st century. And we are not talking about losing a battle here (even a major one) – we are talking about losing the war.
The Return of Convergence Theory?
iberal political systems assume a degree of external and internal openness. As a rule, liberalism promotes the idea of the free movement of goods, services and people around the world. While people in China saw the closing of the country’s borders as a natural measure for preventing the spread of the coronavirus, similar steps in Western countries were met with fierce criticism from the political opposition. And this is understandable, as a person in a liberal society is first and foremost a “citizen of the world,” rather than a citizen in an authoritarian society. Inside one’s own country, the former enjoys more professional, social and geographical mobility than the latter and has a much wider network of social and professional contacts. This is precisely why a liberal society is, by definition, a more fertile environment for spreading COVID-19.
Liberal societies are far more resistant to attempts by the state to interfere in the private lives of their citizens, be it monitoring smartphones to identify people with whom an infected individual may have had contact or restricting the movement of the population. It is more difficult to place limits on household consumption in liberal societies, even when such restrictions are necessary to prevent panic buying, artificial scarcity and price gouging. Similarly, the liberal economic model is not as effective as the authoritarian model when it comes to mobilizing productive resources in times of war, natural disasters and other difficult times.
None of this necessarily means that authoritarianism will always triumph over liberalism. Even the most effective forms of authoritarianism (as displayed by the Chinese model) have their obvious flaws and imperfections. But if China scores a resounding victory in the battle of “coronavirus narratives,” then much will surely change in terms of what we consider the most desirable future for humankind.
After all, COVID-19 is not the last pandemic that the world will have to face. And let us not forget about climate change, the increasingly frequent natural disasters, possible resource shortages and other emergency situations which, unfortunately, are becoming part of the “new normality.” People across the world want to be free. Freedom is still valued highly. But what if we put the question rather coldly: Would you prefer to survive in an authoritarian Wuhan or die in a free New York?
In the middle of the last century, several prominent thinkers, including Pitirim Sorokin and John Galbraith put forward the idea of converging two opposing socio-economic systems. The so-called convergence theory gained popularity in the 1960s–1970s, even though it was heavily criticized in both the East and the West. The implosion of the world socialist system at the end of the 20th century meant that everyone simply forgot about it, condemning it to the scrapheap of human errors. Perhaps now is the time to revisit the idea from a 21st-century perspective?
From our partner RIAC
A brief history of Sino-Australian political relations from 1949 to 2020
To understand what is happening now requires an understanding of history. The recent Sino-Australian relations have been like a roller coaster ride, which needs to date back to history at least from 1949.
There are several characteristics worth mentioning in Sino-Australian relations. First, there have been diplomatic ups-and-downs between the two governments due to the divergence of the two countries’ political systems and ideology. Second, by comparison, bilateral ties have generally been improving for decades due to the reciprocal economic complementarities and cooperation despite the recent trade disputes. Third, Sino-Australian relations “has become more unequal with the passage of time” due to China’s rise. Fourth, the influence of the US on the foreign policy of Australia cannot be underestimated. In terms of structure, this part will be divided into four periods, posited on the founding of the People’s Republic of China in 1949, the establishment of diplomatic relations in 1972, the outbreak of Tiananmen Incident in 1989 and the recent decline of bilateral relations starting from 2015 with additional illustration of the influence of the US in Australian foreign policy.
Graeme Dobell argues, “China has always loomed in the Australian consciousness”, possibly because Australia is geographically located in the Asia Pacific and surrounded by Asian countries with a significant number of ethnic Chinese. Historically, China was viewed in Australia as a threat, namely, “Yellow Peril”. The notion is a color-metaphor, full of racism. East Asians, especially the ethnic Chinese, are an existential hazard to other countries as immigrants. Professor Gina Marchetti argues that
the rooted in medieval fears of Genghis Khan and Mongolian invasions of Europe, the yellow peril combines racist terrors of alien cultures, sexual anxieties, and the belief that the West will be overpowered and enveloped by the irresistible, dark, occult forces of the east.
In Australia, as a Western country located away from the West, its Immigration Restriction Act of 1901, infamous as the White Australia Policy, was designed to prohibit Chinese settlers. “Fear of China and hostility to the Chinese immigrants were factors” that supported the Federation of Australia, and both factors existed for decades. The federating of Australia was the process by which the sixBritish colonies consented to unite and become the Commonwealth of Australia. Liberal Prime Minister Harold Holt formally abolished the White Australia Policy in 1966 with the introduction of the Migration Act 1966. By legislating legal equality among European and non-European migrants, this new Act has opened a new immigration history era. It has been the most crucial step in forminga multicultural society in Australia.
However, Australia’s unique geographic location and huge disparity of population between Australia and China have decided that the natural insecurity of Australia as a nation, for that linguistically, historically and intellectually, Australian ancestry originates from Europe, and its vital economic partner and most crucial military ally is the United States, both far away from Australia. Furthermore, Gyngell argues there is always “fear of abandonment” in Australian foreign policy. Likewise, former Australian Minister for Foreign Affairs Gareth Evans and former Australian diplomat Bruce Grant confirm that
the evolution of Australian foreign policy needs to be assessed against a background in Australian politics of persistent anxiety about a threat from Asia: sometimes vague and undifferentiated, sometimes specific, but always there.
In this period, China was viewed in Australia as a threat, namely, the aforementioned “Yellow Peril” and “Red Menace”. Arguably, the Red Menace has always existed in the Australian society and the government until now,which is a term applied during the Cold War for describing a nation that faces the increasing authoritarian threat of communism. This term was used to refer to the Soviet Union, while nowadays, it has been employed to mean Communist China. Besides, the difference of scare only reflects the extent to which the Australian government fears the Chinese Communist Party. From 1949 to 1972, especially when Australian and Chinese troops participated in the Korean War as rivals and later the Cultural Revolution was launched in China, Sino-Australian relations were hostile to each other due to the fact they were both subordinated to different political and ideological camps: USSR-led communism and the United Stated-led capitalism.
During this period, Sino-Australian relations encountered the most drastic ups and downs the bilateral ties have ever experienced. In 1972, the Whitlam Labor government’s election marked the most radical turning point in Sino-Australian history by establishing diplomatic relations with China in December of the same year. Despite the endeavor, Whitlam made, this new chapter of the bilateral relations is mainly dependent on the change of China Policy from the strongest ally of Australia, the United States. More concretely, in the early 1970s, the American army was withdrawn from Vietnam, indirectly ending the military collisions with the People’s Liberation Army.At the beginning of 1972, Nixon has his dramatic visit to Beijing and Shanghai.
From 1972 to 1989, the bilateral relations were at the stage of steady development. Partly, the positive Sino-Australian relations can be attributed to the same view of opposing the Soviet threat, which facilitated the Sino-Australian cooperation. More specifically, in July 1973, the first Sino-Australian trade agreement was signed by the Chinese government and the Whitlam government. The visit of Whitlam to Beijing in late 1973 culminated in a joint communique, concurring with the promotion of views exchanges among the Sino-Australian officials. In 1976, during the period of the Coalition-led Fraser government, “the Australian Parliament even stood in silence in the honor” of Mao Zedong, when Mao passed away. In 1978, the Australia-China Council was built by the Coalition-led Fraser government to facilitate bilateral relations.
Furthermore, in the 1980s, with the economic reform of Deng Xiaoping and the incrementally frequent visits of Sino-Australian senior leaders, the Australian government saw the economic opportunities China may bring, and the Chinese government also realized the Chinese modernization might benefit from the support of Australia. Mackerras argues that “the mid-1980s saw the relationship reach a peak”. In 1984, the ALP-led Hawke government launched the China Action Plan, “an overall economic program towards China”, aiming to deepen bilateral economic cooperation. In 1985, Hawke told the Australian parliament that a ‘special relationship’ between the two countries was forming.
The realistic Sino-Australian political relations from 1990 to 2015
The outbreak of the Tiananmen Incident in 1989 was a devastating turnaround in Sino-Australian relations, bringing the vigorous relations to a sudden stop. To some extent, Deng’s economic reform gave Australia and the Western world an illusion that China tried to become more Western. Contrariwise, the Incident shattered misapprehension of the special relationship between the two countries and has pushed human rights to one of the central issues that needs to be addressed in the bilateral agenda until now. It is noteworthy that the negative influence of the Tiananmen Incident was in all domains. Antagonized by the Australian broadcasting of violence in Beijing, the Australian people, including politicians, business people, scholars and religious figures, unanimously condemned Beijing. All aspects of Sino-Australian relations were affected at varying levels.
Arguably, after the Tiananmen Incident, the attitudes of the Australian government has changed to be more pragmatic and national-interest-driven. Wang argues that the reassessment of Sino-Australian relations “did not lead to a fundamental policy shift” in Canberra “and human rights were not emphasized to the detriment of Australia’s economic interests”. In 1993, as the first Australian Prime Minister after the Incident, Keating visited China, breaking the diplomatic ice, partly because he needed to push wool exports to China.
Noticeably, from 1989 to 2015, China and the comparison of world powers experienced earthshaking changes. The hazards of the Asian Financial Crisis in 1998 and the Global Financial Crisis in 2008 lead to the economic meltdown of some Southeastern countries and the relative decline of the West. Bearing the two Crises, China has benefited enormously, even the most, from joining the WTO and other regional and global economic organizations as a member of economic globalization. At the end of 2010, China surpassed Japan and has become the second-biggest global economy, indicating that the global economic center has gradually transferred to East Asia. During this period, Hong Kong and Macao were subsequently handed over to China, enhancing China’s confidence. There is no doubt that bilateral relations have been increasingly asymmetrical during this time, leading to the concept of equal partners less possible.
From 1989 to 2015, facing China’s economic rise, on the one hand, the Australian government and business took advantage of the historical opportunities and have been more engaged in the Chinese economy. For instance, the Coalition-led Howard government was a firm“ supporter for China’s accession to the WTO” to share better Chinese economic growth. In 2014, the Coalition-led Abbott government and the Chinese government started to portray the bilateral relations as a “comprehensive strategic partnership” due to the incremental and robust trade relations and more frequent communication between top leaders of the two sides. On the other hand, due to the different political ideologies and systems, and the gradually widening disparity of the two countries, there have been strong concerns in the Australian government that China may leverage trade over Australia. Foot indicates the sense of uncertainty and insecurity in Canberra that
Has Beijing worked to support the dominant norms of the international order, or has it striven to overturn them? Has it ever deserved to be called “responsible power”, a term defined by the dominant states, or has it acted irresponsibly? To place these questions more explicitly within an international relations framework, has China shown itself since 1949, and more especially during the period of reform and opening since 1979, as capable of be socialized into supporting global norms? Or, as realists would predict, have there been signs that its rising power over the past two decades has generated new tensions in the international system? Looking more to the future, what kind challenge does its enhanced capabilities pose to the status quo?
Despite the dilemma that the Australian government has to face and the political ups and downs between the two countries during this period, “the growing sense of independence in formulating Australia’s policy towards China, as well as the increasing saliency of trade considerations in implementing such policy, has transcended political and inter-administration divides”. Thus, to some extent, although there were still ups and downs during this period from the ALP-led Hawke government to the Coalition-led Abbott government in 2015, the bilateral relations “appears to have become less uncertain” and matured. Arguably, the Australian government started to view China either without unjustified fear as they had before 1972, or super optimism as they had before 1989.
In fact, the differences may only exist in the style of how different administrations approach China. For instance, the first Mandarin-speaking Prime Minister Kevin Rudd introduced a concept called “Zhengyou in Chinese that means to voice different opinions to benefit the Chinese leadership. By comparison, another Prime Minister John Howard preferred to deal with China on more practical issues.
The increasingly strained bilateral political relations from 2016 to 2020
Bilateral relations have deteriorated since the exacerbation of territorial disputes in the South China Sea in 2016. The Australian government criticized China for not abiding by the South China Sea Arbitration, a joint statement with Japan and the US. In response, the Chinese government expressed its strong displeasure through its state-owned media the Global Times, denouncing Australia as a “paper cat”. Currently, the Australian government is concerned that Chinese activity in the South China Sea may threaten Asia pacific security, thus influencing Australian sovereignty and security.
More importantly, Australia’s closest and strongest ally, the US, initiated a trade war with China at the beginning of 2018. Since Australia often follows American foreign policy, the increasingly intense Sino-American relations have negatively affected Sino-Australian relations. In the same year, Sino-Australian ties soured further when Australia became the first country to officially ban China’s Huawei from its 5G network. A similar prohibition on Huawei was later executed in the US in 2019.
In terms of domestic politics, there are continuously more negative speeches about China.Australian politician Andrew Hastie urges urged the Australian government and public to realistically recognize the unprecedented democratic conviction and security threat from China. He even goes “as far as to compare the Western tolerance of China’s rise with the appeasement of Nazi Germany”. Hamilton argues Chinese infiltration in Australia is a “silent invasion”. The Minister for Home Affairs Peter Dutton, one of most senior officers in the Liberal-Coalition-led Morrison administration, condemned China’s interference and cyber hacks in Australia and claimed that the policies of the CCP are incompatible with Australian values.
2020 may have been the most turbulent year for Sino-Australian relations so far. Facing the once-a-century Covid-19 pandemic, Beijing has taken trade actions against a series of Australian goods such as barley, cattle, wine, cotton and coal after the Morrison administration advocated an independent Covid-19 inquiry without consulting Beijing first.
The tension also extended to people-to-people exchange. Canberra has warned its residents against arbitrary arrest in China. In contrast, Beijing has cautioned against studying and visiting Australia due to purportedly increasing racism and discrimination against people of Chinese and Asian descent. At the end of 2020, Morrison reacted furiously and demanded an apology from Beijing to an image tweeted by a Chinese diplomat showing an Australian soldier holding a knife to an Afghan child’s throat, which has further shadowed current and future relations.
Meanwhile, despite the global pandemic, there is increasing scrutiny in Australian media, including of the Hong Kong anti-extradition bill, the Xinjiang re-education camp, and China’s political donation to Australian political parties, Chinese spy students, the fight between Hong Kong and Chinese students in Australia, the defection of Wang Liqiang, Huawei backdoor suspicion and the detention of Cheng Lei and Yang Hengjun. According to the Lowy Institute poll in 2019, Australians’s trust in China to ‘act responsibly’ has dropped to 32 %, a 20-point decline from 2018. In 2020, trust in China has deteriorated to 23%, the lowest point in the Poll’s history.
Whatever, if any, evidence underpins these narratives or not, they seem to point out one reality: the plummeting state of Sino-Australian relations. Geoff Raby, former Australian Ambassador to China, even argues that Sino-Australian relations are at their lowest ebb since 1972.It may be controversial to argue that the current bilateral relations are worse than the relations in 1989, but it is appropriate to point out the reality that the Sino-Australian relations have been incrementally damaged. The Australian government’s dilemma is the overreliance of the Australian trade upon China and the exacerbated political disagreement. Jonathan Pearlman argues that “security and economics are tugging Canberra in different directions, as are its values and its interests”.
The Influence of the United States in Australian foreign policy
Undoubtedly, the Australian foreign policy has been influenced by the American government, as Australia has been called the “fifty-first state” of the US. Australia and the US have the same language background, similar European ancestry, similar political systems and strong economic ties. More importantly, in 1951, Canberra and Washington agreed on the Australia, New Zealand and United States Security Treaty (ANZUS), regulating that “an attack on either country’s armed forces or territory in the Pacific area” means “common danger” for the three countries. Since the US abolished its responsibilities to New Zealand due to the disputes of nuclear-armed ships, the ANZUS has become a bilateral treaty between Australia and the US and, separately, between Australia and New Zealand.
Given the American economic and military power around the world and the substantial disparity of Australia-American strengths, it is easy to argue that the ANZUS is the cornerstone of Australian security, and the US is the most important ally of Australia. In fact, Australia followed the US’s leadership through the UN, in the Korean War in 1950, the Vietnam War in 1962, the Afghanistan War in 2001 and the Iraq War in 2003 and recognized the PRC after the Nixon government had changed its China policy. To underpin the above view, Tow and Albinski affirm that the “ANZUS alliance remains Australia’s primary security relationship”. The former Australian diplomat Dr.Alison Broinowski argue that
Australia uncritically and voluntarily imitates its major ally (the United States) and its minor ally (the United Kingdom) in most things, yet lacks the capacity to do them well and the independence to do them differently. Having taken the drug of dependence from birth, Australia seems allied and addicted to it.
Thus, it is easy to question how independent Australia’s foreign policy is, especially its China policy, and argue that Australia does generally imitate the US’s foreign policy. As for the recent downturn of bilateral relations, Geoff Raby, an insider of Australia politics, believes that Canberra has developed policies to push back China’s rise in that the US started regarding China as a strategic competitor.
However, there is some policy flexibility in the Australian government, mainly economic-interests-motivated. To cite an instance, despite the opposition of the US, Australia participated in the China-led Asian Infrastructure Investment Bank in 2015 and leased the Port of Darwin to a Chinese company in the same year. Australia took the position as an outsider in terms of the Sino-American trade war, suggesting the two sides to end the fight to avoid the risks of collateral damage to Australia. Even in the 1950s and 1960s, when the Australian government adopted a hostile attitude towards China, the wheat trade between China and Australia“reached a significant level”.
The Economic Revival of Japan
Amidst the uncertainty weaved by the pandemic, the stock markets around the world have shunned the preconceived notions associated to their functionality over the past year. While some sophisticated economies are suffering turmoil at the ensue of new Covid variants, deviant vaccination drives, and resumption of state-wide lockdowns, some of the countries are outright negating the educated forecasts made by seasoned financial experts all over the globe. China stands as a flag-bearer of such reality-defying markets: bagging GDP growth unlike any in the world whilst simultaneously controlling the virus strain in Beijing. Recent to the tally, however, is the quaint nation of Japan that despite being head-to-head with another gruesome wave of Coronavirus, still manages to consistently outperform the hailed champions of the global financial markets.
The 3rd biggest economy in the world astonished the financial gurus when Nikkei 225, Japan’s core stock market Index, soared up steadily over the last few weeks. With a 1.9% hike at the week’s opening on Monday, 15th February, Nikkei 225 Index surpassed the coveted 30000-point threshold after more than three decades. The economic rebound is associated to the export sector picking up the pace after a sluggish performance last year. The country still wrestles with the throttle of the pandemic; confirming over 1000 Covid-positive patients since November 16th and adding the cumulative death toll of 7056; surpassing the 7000 deaths mark in just under two weeks.
The positive effect, however, dawns since the daily confirmed cases are showing a steady drop; below 1000 daily-confirmed cases in over 4 months. This occurrence is in tandem to the global fall in the Covid cases. Moreover, Japan’s approval of the Covid vaccine produced by Pfizer Inc. is reflecting the recovery in the health condition of the country, especially a lucrative news amidst the second health emergency recently imposed in Tokyo.
Standing at the 30393.13-point mark, Nikkei 225 is expected to follow the bullish trend heavily over the following week as well. According to the measured forecasts, the bourse is optimally headed to strike the 33000-point mark after crossing the milestone of triple decades. This is due to the positive economic outlook in tandem to the rebooting of the global economy which would ultimately enable the export-reliant country. With Japan announcing a 12.7% GDP growth trailing from the recovery of the last quarter of 2020, followed by a hefty government stimulus to prompt domestic consumption, the Japanese bourse is expected to inflate by up to 30% by the end of the first quarter of 2021 in March, presumably speculating a record surge to bypass the highest ever figure of 38915.87-point, posted by Nikkei 225 back in 1989 before being subsequently floored by the notorious price bubble crash.
However, the economic recovery much less a record shattering surge in the market is heavily dependent on some of the core facets. The debacle of the nationalisation of vaccines is evident in Europe and ironically is the crisis posing more of a serious threat than the pandemic itself. Japan’s economic stability would only be possible given the vaccinations are administered effectively and timely with minimal resistance. As Japan still finds it hard to evade the emergency measures introduced in multiple regions, a vaccine crisis could intensify the emergency precautions and lockdowns may even gear into effect. This could seriously undermine the production capabilities of the country which ultimately could carry forward as an element hampering the blooming investor confidence in Japan.
Much to the global conformity of economic peril last year, Japan’s economy also contracted by 4.8% in 2020. The steep contraction, despite being of a greater extent relative to the 3.5% annualised shrinkage in the US economy, was still much controlled than the forecasted 5.3% fall projected by the International Monetary Fund (IMF). However, unlike some of the regional economies, the pandemic-induced decline lasted only for a short span of time before Japan waded through and rallied. Posting a 3% growth in the 4th quarter of 2020, when major economies like Germany and US grappled with recession, Japan steadily made surface.
Now as the pessimism looms in Europe and the political divide worsens in US, Investors are pouring confidence in Japanese equities which provide a solid foundation to the already surging Japanese Indices. This shift in perspective could be gauged by the purview of global stock positions taken by the active equity investors throughout the globe; pouring investments unlike the sceptical position adopted since January. The increasing investor confidence coupled by the improving economic and social health of Japan has proved monumental on the financial charts; despite being in the highs of a heavy stimulus, S&P 500 continues to be outperformed by Nikkei 225, sometimes even falling short by colossal margins to the returns added by the Japanese Index.
Which way the markets would turn and how Japan could sustain the whelming economic recovery depends largely on how Japan deals with Covid and how efficiently it regulates the vaccination drives. Moreover, Japan’s success may be upped the ante by any new misery that might befall on US or Europe that could ultimately drive more confidence and flare to the 3rdlargest economy of the world.
Mongolia-World Bank Group Partnership: Three Decades of Partnering for Prosperity
It all began exactly thirty years ago. On February 14, 1991, the eve of Tsagaan Sar, Mongolia joined the World Bank Group. This was the period when the country had just gotten on the path of democracy, free market, and openness to the outside world. Mongolia rightly took pride in this transition but, at the same time, it presented enormous challenges, including a sharp economic contraction. Following the cut of external aid, the hardship was felt by Mongolians every day. Long lines were visible on every street corner for rationed food.
The World Bank’s support was quick to arrive. By the end of 1991, the first project of $30 million was already signed to help rehabilitate production in key sectors such as agriculture, energy and transport. The World Bank also carried out a comprehensive macroeconomic analysis, zooming in on the immediate challenges of runaway inflation and falling output.
Since these early days three decades ago, the World Bank Group (WBG) has accompanied Mongolia’s strong recovery and development, culminating in the country’s graduation from the International Development Association (IDA) – the WBG’s lending window for low income countries – last year. Mongolia’s economy has expanded significantly over this period, with GDP per capita rising more than fourfold from $1,072 in 1991 to $4,339 in 2019. But growth has been volatile. Like many other resource-rich countries in the world, Mongolia experienced persistent boom-and-bust cycles. Economic diversification remains critical to generate productive jobs, especially for the young. People’s living standards have improved, but growth did not not generate shared prosperity for all. Mongolian citizens expect their government to deliver quality education and health services, and provide for a clean and safe living environment. Their aspirations have not yet been fully realized.
Through good and difficult times, the WBG has remained a steadfast partner of Mongolia. Our budget support operations helped Mongolia restore macroeconomic stability and lay the foundations for inclusive growth. Our investments contributed to economic development in both mining and non-mining sectors, improving people’s livelihoods, and addressing environment and climate challenges. A total of $1.28 billion World Bank financing has been committed to Mongolia for these years. The WBG’s private sector arms—the International Finance Corporation (IFC) and Multilateral Investment Guarantee Agency (MIGA)—have also been active in supporting private investments.
The investments have helped improve people’s livelihoods across the country. In the energy sector, we supported electricity access to over 100,000 rural and herder families providing them with portable solar panels in the 2000s. In the early 2000s, the World Bank telecommunications project helped all 360 soums in Mongolia gain access to modern phone and internet services. To help herders mitigate natural disaster risks, we supported the world’s first index-based livestock insurance system in Mongolia. To improve governance, we helped revamp the statistical system in Mongolia to match international standards to inform decision making, and empowered citizens to make their voice heard on public expenditure allocations at local levels. IFC financed Mongolia’s first utility-scale windfarm for the country and supported reforms to increase access to finance for SMEs through enabling movable collateral.
Most recently, in the face of the COVID-19 pandemic, the WBG quickly mobilized over $60 million to support the relief and stimulus measures for saving lives, protecting the poor and vulnerable, and ensuring sustainability of businesses and jobs. These resources are being invested for the most essential medical and diagnostic equipment in three tertiary hospitals, nine district hospitals of the capital city and 21 aimags, personal protective equipment for frontline health workers, and training for medical staff. A new project, which would finance the vaccination of about 60 percent of Mongolians has just been approved. The Bank is also financing the temporary relief of social insurance contribution for over 120,000 self-employed workers including 72,000 women and around 150,000 workers employed by 18,000 firms affected by COVID-19. Bank support has also benefited approximately 1.19 million children through the top-up payments to the government’s Child Money Program.
After thirty years of partnership with the World Bank Group, Mongolia has become a lower-middle-income country and its vision is to become by 2050 a high-income country with high levels of human development, better quality of life, a diversified economy, and good governance. This is an aspiration we will continue to support. To turn it into reality will be challenging. The first step will be to gradually phase out short-term relief measures and return to the important agenda of structural reforms which are needed to rekindle growth and make it sustainable and inclusive. Over the medium-term, Mongolia will have to contend with the growing risks associated with climate change, and the challenges this will bring to the structure of its economy. And it will need to offer its youth the perspective of productive, well-paying jobs, to retain the country’s talents at home.
The WBG is honored to have been Mongolia’s trusted partner over the past thirty years. We are confident that our partnership will continue and further strengthen in the decades ahead, rain or shine.
 Mongolia joined the International Bank for Reconstruction and Development (IBRD), International Development Association (IDA), the International Finance Corporation (IFC), and International Centre for Settlement of Investment Disputes (ICSID) in 1991; and Multilateral Investment Guarantee Agency (MIGA) in 1999. All these organizations together known as the World Bank Group.
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