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401. Smart Money on Chinese Advances in AI

Author:
William A Carter and William Crumpler
Publication Date:
09-2019
Content Type:
Working Paper
Institution:
Center for Strategic and International Studies
Abstract:
Few countries have embraced the vision of an AI-powered future as fervently as China. Unlike the United States, the Chinese government is dedicating significant resources and attention to AI development and creating a supportive policy environment to facilitate innovation and experimentation and proactively manage risk. However, numerous misconceptions and competing narratives around China’s innovation economy have made it difficult for U.S. policymakers to understand the AI ecosystem in China and its links to AI innovation in the United States. This report seeks to improve this understanding by examining China’s progress toward achieving its four strategic goals. We find that while China’s progress towards AI leadership remains uneven, its commitment to building domestic innovation capacity could allow the country to become a world-leading AI power in the coming decades. China’s progress in AI can complement and accelerate U.S. AI development, and policymakers should avoid responding to China’s advances with counterproductive policies that undermine the U.S. innovative capacity to little or no gain. Instead, the United States should focus on developing a positive agenda for driving its own AI development.
Topic:
Science and Technology, Innovation, Artificial Intelligence, and Emerging Technology
Political Geography:
China, Asia, North America, and United States of America

402. Shooting Oneself in the Foot? Trade War and Global Value Chains

Author:
Cecilia Bellora and Lionel Fontagné
Publication Date:
12-2019
Content Type:
Working Paper
Institution:
Centre d'Etudes Prospectives et d'Informations Internationales (CEPII)
Abstract:
Despite the “Phase One Deal” agreed on mid-December 2019, bilateral tariffs between US and China remain at unprecedented high levels, which will have long-lasting effects. US tariffs remain very high on parts, components and other intermediate products; similarly, only the last wave of Chinese retaliatory tariffs has been half cut. We investigate in this paper how such tensions between highly interdependent economies will impact trade, income and jobs. We rely on a set-up featuring General Equilibrium, imperfect competition and importantly differentiating demand of goods according to their use, for final or intermediate consumption. This authorizes tracing the impact of protection along the value chains, on prices, value added and factor income. Additional tariffs from official lists are taken into account at the tariff line level, before being aggregated within sectors. Beyond the direct toll of sanctions, US exports to the world post a sizeable decrease as a result of reduced competitiveness led by vertical linkages along the value chains. Because of the tariffs in place as of February 2020, three quarters of the sectors decrease their value added in the US. Consistent with political economy determinants, these twists of value added are transmitted to production factors, leading to sizeable creation and destruction of jobs, and reallocation of capital to the benefit of protected sectors, mostly at the expense of their clients. Ultimately, this paper sheds light on the economic consequences of policies disrupting global value chains.
Topic:
Economics, International Political Economy, Bilateral Relations, Tariffs, Trade Wars, and Trade
Political Geography:
United States and China

403. Are Your Labor Shares Set in Beijing? The View through the Lens of Global Value Chains

Author:
Ariell Reshef and Gianluca Santoni
Publication Date:
12-2019
Content Type:
Working Paper
Institution:
Centre d'Etudes Prospectives et d'Informations Internationales (CEPII)
Abstract:
We study the evolution of labor shares in 1995-2014 while taking into account international trade based on value added concepts. On average, the decline in labor shares (starting around 1980) accelerates in 2001-2007, after which labor shares recover somewhat. In contrast, skilled labor shares consistently increase. The acceleration in the decline in labor shares is associated with increased intensity of intermediate input exporting; this manifests in a sharp increase in the foreign component in upstreamness of industries and countries in global value chains (GVCs). China's global integration accounts for much of this. Declines in the price of investment together with capital-skill complementarity can explain both the consistent increase in skilled labor shares and the reversal of trend in overall labor shares. Compared to shares in GDP, labor shares in gross national product (GNP) are higher in countries with positive net FDI positions; the uneven spread of multinational activity contributes to greater inequality through this channel.
Topic:
Economics, International Political Economy, International Trade and Finance, Labor Issues, Trade, Global Value Chains, and Skilled Labor
Political Geography:
China and Global Focus

404. Exchange rate pass-through to import prices: Accounting for changes in the Eurozone trade structure

Author:
Valérie Mignon and Antonia Lopez-Villavicencio
Publication Date:
06-2019
Content Type:
Working Paper
Institution:
Centre d'Etudes Prospectives et d'Informations Internationales (CEPII)
Abstract:
This paper assesses whether the emergence of new trading partners (i.e., China and Eastern Europe) as suppliers reduces the exchange rate pass-through (ERPT) in Eurozone countries which differ regarding their external exposure. Using bilateral data on import prices at the two-digit sector level, we find that (i) pass-through is complete in many cases, (ii) ERPT from China is higher than from the United States, and (iii) there is no compelling evidence of a generalized link between ERPT and the increasing integration of some emerging markets in European imports. We also show that the launch of the single currency has not provoked a sufficient change in the part of trade exposed to exchange rate fluctuations and, therefore, has not affected the pass-through. Overall, the trend of liberalization in new players' markets has not altered the competitive environment such as to induce exporters of other countries to absorb exchange rate depreciations.
Topic:
Economics, International Political Economy, International Trade and Finance, Exchange Rate Policy, Eurozone, Trade, and Imports
Political Geography:
China, Europe, and Eastern Europe

405. Income and consumption inequality in China: A comparative approach with India

Author:
Carlos Gradín and Binbin Wu
Publication Date:
08-2019
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
We analyse income and expenditure distribution in China in a comparative perspective with India. These countries represent extreme cases in the relationship of inequality to both wellbeing indicators. Income is more highly concentrated than expenditure in India, especially at the top of the distribution. Both types of inequality are similar in China, although expenditure is more unequally distributed than income in urban areas. China has a much stronger correlation in individual ranks and levels between the two wellbeing distributions. As a result, expenditure inequality is higher in China than in India, but income inequality much lower. This results partially from differences in population composition, such as China being more urbanized and having smaller households, but mostly from differences in conditional income distributions, especially by attained education of the household head. We show that hybrid measures of wellbeing combining income and expenditure can be useful for such cross-country comparison.
Topic:
Inequality, Income Inequality, and Consumerism
Political Geography:
China, South Asia, India, and Asia

406. Now I Know my ABCs: U.S.-China Policy on AI, Big Data, and Cloud Computing

Author:
Wenhong Chen
Publication Date:
09-2019
Content Type:
Working Paper
Institution:
East-West Center
Abstract:
Artificial Intelligence (AI), Big Data, and Cloud Computing (ABC) have generated unprecedented opportunities and challenges for economic competitiveness, national security, and law and order, as well as the future of work. ABC policies and practices have become contentious issues in U.S.-China bilateral relations. Pundits see a U.S.-China AI race and are already debating which country will win. Kaifu Lee, the CEO of Sinovation Ventures, believes that China will exceed the United States in AI in about five years. Others argue that China will never catch up. This essay focuses on two issues: the comparative ABC strengths of the United States and China in data and research and development (R&D); and the emerging ABC policies and practices in the two nations. Empirical analysis suggests that the United States and China lead in different areas. Compared to China’s top-down, whole-of-government, national- strategy approach, the U.S. ABC policy has been less articulated but is evolving.
Topic:
Science and Technology, Artificial Intelligence, Strategic Competition, Data, and Cloud Computing
Political Geography:
China, Asia, North America, and United States of America

407. Chinese, Japanese, and Korean Inroads into Central Asia: Comparative Analysis of the Economic Cooperation Roadmaps for Uzbekistan

Author:
Timur Dadabaev
Publication Date:
12-2019
Content Type:
Working Paper
Institution:
East-West Center
Abstract:
China, Japan, and South Korea have regarded Central Asia as a new Asian frontier in their foreign policies since the collapse of the Soviet Union. With time, their policies evolved into regionbuilding initiatives exemplified by the Shanghai Cooperation Organization, Belt and Road Initiative, Central Asia plus Japan Dialogue Forum, and Korea-Central Asia Cooperation Forum. This paper raises the following research questions: What are the areas of interest for China, Japan, and Korea in their relations with Central Asian states and Uzbekistan in particular? What are the patterns of agenda setting in establishing intergovernmental cooperation? What are the particular projects that these states initiate? What are the objectives of projects initiated within these areas of interest? How competitive or complementary are these projects of China, Japan, and Korea? Throughout, Chinese, Japanese, and Korean “Silk Road” roadmaps with Uzbekistan are discussed to highlight their similarities and differences.
Topic:
Foreign Policy, Economy, and Economic Cooperation
Political Geography:
Japan, China, Central Asia, Asia, South Korea, and Uzbekistan

408. Domestic Politics Force India's Withdrawal from RCEP and Broader Trade Disengagement

Author:
Amitendu Palit
Publication Date:
11-2019
Content Type:
Working Paper
Institution:
East-West Center
Abstract:
The Regional Comprehensive Economic Partnership (RCEP) negotiations concluded at the ASEAN Summit in Bangkok on November 4, 2019. Fifteen RCEP members, including the ten-ASEAN countries, and Australia, China, Japan, Korea and New Zealand, agreed to commence preparation of the legal text of the agreement for signing in 2020. India was the only member to opt out, citing significant unresolved outstanding issues. India’s decision was surprising as it actively participated in the negotiations that lasted for 29 rounds and went on for more than six years since beginning in 2013. Domestic pressures forced Prime Minister Modi to withdraw India from RCEP at the last minute. It also points to disengagement becoming the prominent character of India’s trade policy as domestic protectionist interests successfully undermine outward-oriented economic visions.
Topic:
Politics, Treaties and Agreements, Economy, Trade, and ASEAN
Political Geography:
China, India, and Asia

409. Addressing China's Exported Emissions

Author:
Amy Namur
Publication Date:
12-2019
Content Type:
Working Paper
Institution:
East-West Center
Abstract:
Once known as the world's top carbon polluter, China has recently recommitted itself as a leader in sustainability and renewable energy. Moving to fill the gaps left by the United States at the Paris Climate Talks, China has ramped up its renewable energy commitments, including plans to cap its CO2 emissions, drastically increase forest stocks, and expand its non-fossil fuel market share to 20 percent, all by 2030. This move has been highly favorable for Chinese diplomatic relations with its Southeast and Pacific Island neighbors who have labeled climate change as a top priority. Domestically the extensive health impacts of air pollution in China has rallied public opinion against the pollution industry, making the move to green energy both a wide berth of support. While still the highest CO2 emitting country in the world, China has made significant investments in renewable energy development and currently leads the planet in renewable investments abroad. China’s domestic commitment to sustainability has been ambitious; however, meeting these goals has created one of the biggest energy paradoxes of the 21st century.
Topic:
Climate Change, Renewable Energy, Sustainability, and Carbon Emissions
Political Geography:
China and Asia

410. Water Security in the Himalayan Region: Navigating Opportunities for Joint Prosperity and Conflict Prevention

Author:
Farwa Aamer and Jace White
Publication Date:
12-2019
Content Type:
Working Paper
Institution:
EastWest Institute
Abstract:
On October 21, 2019, the EastWest Institute (EWI), together with the Multinational Development Policy Dialogue of the Konrad-Adenauer-Stiftung (KAS), convened a high-level roundtable dialogue in Brussels, concerning international water security. The dialogue, the first in the project series, brought together distinguished experts representing both the public and private sectors in China, India, Pakistan, Bangladesh, Nepal and the European Union to assess the risks and threats to water security and gauge opportunities for future cooperation between co-riparian states in the Himalayan region. The roundtable dialogue consisted of two panels: “Rethinking Hydrodiplomacy in an Uncertain Geopolitical Future,” moderated by Ms. Kitty Pilgrim, international journalist and former CNN correspondent, and “Effective Water Resource Governance through Multi-Stakeholder Partnerships,” moderated by Dr. Peter Hefele, head of the Asia and Pacific team of the Konrad-Adenauer-Stiftung (KAS).
Topic:
Conflict Prevention, Security, International Cooperation, and Water
Political Geography:
China, India, Asia, and Himalayas

411. Petro Dollar. Petro Yuan. Petro Rupee?

Author:
Amit Bhandari
Publication Date:
08-2019
Content Type:
Working Paper
Institution:
Gateway House: Indian Council on Global Relations
Abstract:
Over the last two decades, every component of the global energy scenario has changed: demand, supply and energy-type. The only constant has been the U.S. Dollar as the currency of energy trade. Lately, the Chinese Yuan has emerged to challenge the Dollar. Can the Indian Rupee be a third player? India is now the world’s third-largest consumer and second-largest importer of energy. Its open market, transparent regulation and growing demand give it an opportunity to become the hub of a vibrant new oil market, simultaneously ensuring its energy security and raising the international profile of the Rupee. This paper explores the possibility the Rupee could be the third currency in which energy is traded, and the challenges and opportunities it presents.
Topic:
Security, Energy Policy, Markets, Oil, Currency, and Trade
Political Geography:
China, South Asia, India, Asia, North America, and United States of America

412. China’s new policy on the European Union: A toughening line on political issues

Author:
Jyrki Kallio
Publication Date:
01-2019
Content Type:
Working Paper
Institution:
Finnish Institute of International Affairs
Abstract:
China’s recent policy paper on the European Union shows that the country continues to recognize the EU as an important partner in many fields. A new, distressing element is that China has toughened its demands towards the EU to respect its core interests and to refrain from meddling in its internal affairs.
Topic:
Globalization, International Affairs, European Union, and Conflict
Political Geography:
China, Europe, and Asia

413. The changing global order and its implications for the EU

Author:
Katja Creutz, Tuomas Iso-Markku, Teija Tilikainen, and Kristi Raik
Publication Date:
03-2019
Content Type:
Working Paper
Institution:
Finnish Institute of International Affairs
Abstract:
The forms of global political transition contradict each other. The Western leadership of the world seems to be in decline, with the US political and military hegemony being challenged by the rise of China and other emerging powers and with global power structures evolving towards multipolarity. At the same time, however, there are increasing signs of a diffusion of state power. It involves a growing group of non-state actors challenging state power in very different forms and different capacities. This report focuses on the axis of state power considered the most important in terms of its global implications: the relationship between the US and China. This relationship is studied with the aim of assessing how the mutual interdependencies are evolving, and what the goals of the two actors look like in respect of their own global role. The im¬plications of this power transition in the key fields of global governance – also covering the simultaneous diffusion of power to non-state actors – forms another relevant topic under review in the global context. Lastly, the report analyses how the EU contends with these forms of power transition and safeguards its own influence in this changing environment. The project also addresses the international role and influence of one of the northernmost EU members, Finland. It investigates how the changes in the global and regional setting should be understood from the Finnish point of view and how Finland should act in order to consolidate its international role in economic as well as political terms.
Topic:
Power Politics, Non State Actors, Hegemony, Leadership, and Liberal Order
Political Geography:
United States, China, Asia, and North America

414. The Sinification of China: How the minorities are being merged into one nation

Author:
Jyrki Kallio
Publication Date:
04-2019
Content Type:
Working Paper
Institution:
Finnish Institute of International Affairs
Abstract:
The long-term aim of the Communist Party is to make China unified, and the most recent tool for this is the creation a Chinese nation. This term was included in the Constitution last year, which contradicts the definition of China as a multi-national state. Unifying China includes promoting a Chinese identity through history and culture. The current borders and ethnic composition of China are presented as the results of natural processes. History is written from the viewpoint of the Han Chinese and their relations with the border regions. Culture is discussed in a similar Han-centric manner. The Party has set “Chinese values” against “universal values” and religions. It demands religions to be Sinified in order to alleviate any risks they might pose to national unity. Most concretely, the creation of a Chinese nation is affecting the people in Xinjiang. This has given rise to concerns in other countries. The Sinification of minority nationalities may potentially become a new stumbling block in China’s relations with Western states.
Topic:
Human Rights, Nationalism, Culture, and Minorities
Political Geography:
China and Asia

415. China’s challenge to human rights: Increased proactivity may weaken the UN human rights system

Author:
Katja Creutz
Publication Date:
05-2019
Content Type:
Working Paper
Institution:
Finnish Institute of International Affairs
Abstract:
China has raised its stakes in human rights governance. It has systematically sought to remove human rights from the centre of the international order by launching alternative human rights concepts, blocking human rights financing at the UN, and hindering civil society involvement in human rights scrutiny. China’s approach to human rights is not only guided by past experiences of humiliation and the idea of developmentalism, but first and foremost by the desire to secure the existing political system and its leadership. The alternative design for human rights is built around consensual cooperation rather than hard legal obligations and international scrutiny. It promotes dialogue and capacity-building instead of practices such as naming and shaming. States supportive of human rights should respond to Chinese efforts in the Human Rights Council as well as within the UN more broadly. This can be done by raising awareness of the systematic attack on human rights, increasing knowledge about Chinese foreign policy objectives, and by creating practices that help to achieve common stances.
Topic:
Civil Society, Human Rights, United Nations, and Humanitarian Crisis
Political Geography:
China and Asia

416. Geostrategically motivated co-option of social media: The case of Chinese LinkedIn spy recruitment

Author:
Mika Aaltola
Publication Date:
06-2019
Content Type:
Working Paper
Institution:
Finnish Institute of International Affairs
Abstract:
Social media platforms enable a strategically motivated and harmful set of practices that leverage both their scalability and targeting potentials. The wider vulnerabilities of digitalized democracies have been much discussed in connection with election meddling and disinformation campaigning. However, the emphasis here is on the more direct vulnerability of mass spy recruitment. The ongoing LinkedIn-based mass recruitment provides a case in point, representing a dangerous vulnerability that can lead to the theft of intellectual property and confidential materials, as well as to the setting up of influence networks. An important case in point is the Chinese co-option of LinkedIn for gaining operatives in and confidential information from Western states and enterprises. Exposing the emerging adversary techniques used by resourceful state actors is the first counter-step. Moreover, preparedness needs to be highlighted, counter-measures modernized, and laws updated to address the new vulnerabilities.
Topic:
Intelligence, Science and Technology, Social Media, Covert, and Spy
Political Geography:
China and Asia

417. US foreign policy tools in the era of disinformation: Deficiencies prevent effective response to malign information operations

Author:
Deborah A. McCarthy
Publication Date:
10-2019
Content Type:
Working Paper
Institution:
Finnish Institute of International Affairs
Abstract:
Russia, China, Iran and ISIS use information operations to undermine the national security objectives of the United States and its allies. However, the US’s international response has been weak. Internal constraints have limited more effective counter-measures. In particular, the lack of a coordinated White House-level strategy, dispersed authorities and little cooperation with private social media companies can be identified as causal factors. Additional steps by the Trump Administration to counter foreign disinformation will aim to protect the 2020 presidential elections rather than to push back on efforts to undermine US leadership abroad.
Topic:
Security, Foreign Policy, Science and Technology, ISIS, Social Media, and Disinformation
Political Geography:
Russia, United States, China, Europe, Iran, Middle East, Asia, and North America

418. Russia and China in the Middle East: Playing their best cards

Author:
Marco Siddi and Marcin Kaczmarski
Publication Date:
11-2019
Content Type:
Working Paper
Institution:
Finnish Institute of International Affairs
Abstract:
Russia and China share a number of interests in the Middle East: limiting US power and maintaining good relations with all players in the region while remaining aloof from the key conflicts, especially between Iran and Saudi Arabia, and Iran and Israel. Russia’s position has been based on political support for particular states, arms sales and the provision of civilian nuclear energy technology. Moscow has boosted its role by intervening militarily in the Syrian civil war. China has been strengthening its political position in the region for the last decade and its presence is more substantial from a financial-economic perspective. The current Chinese and Russian regional posture further marginalises the influence of the EU in MENA. In the Middle East, the EU is already a weaker economic actor than China and a weaker military player than Russia. However, the EU can cooperate with Russia and China on upholding the Joint Comprehensive Plan of Action on Iran’s nuclear programme.
Topic:
Energy Policy, International Cooperation, Nuclear Power, Military Intervention, and Strategic Interests
Political Geography:
Russia, China, Europe, Middle East, and Asia

419. A Stronger Mediterranean Partnership: Why More Than Gas is at Stake

Author:
Eran Lerman
Publication Date:
08-2019
Content Type:
Working Paper
Institution:
Jerusalem Institute for Strategy and Security (JISS)
Abstract:
Israel, Egypt, Greece and Cyprus must encourage the US to assert a higher military and diplomatic profile as a counterweight to Turkish pressures, Russian and Iranian ambitions, and Chinese inroads.
Topic:
Diplomacy, Energy Policy, Military Strategy, and Foreign Interference
Political Geography:
Russia, China, Europe, Iran, Turkey, Middle East, Israel, Greece, Asia, North America, Egypt, Cyprus, and United States of America

420. Can a Chinese-Iranian Deal be Averted?

Author:
Eran Lerman
Publication Date:
10-2019
Content Type:
Working Paper
Institution:
Jerusalem Institute for Strategy and Security (JISS)
Abstract:
Chinese investment in Iran would help Tehran withstand US economic pressures, and exacerbate the Western crisis with Iran
Topic:
International Cooperation, Investment, Economic Diplomacy, and Foreign Interference
Political Geography:
China, Iran, Middle East, Israel, Asia, North America, and United States of America

421. China’s Pursuit of Semiconductor Independence

Author:
James Andrew Lewis
Publication Date:
02-2019
Content Type:
Working Paper
Institution:
Center for Strategic and International Studies
Abstract:
While China has made immense investments in science and technology, and while these are producing results, it is still dependent on Western technology. This is particularly true for semiconductors. China’s dependence on foreign semiconductors has worried Beijing for decades. China suspects that Western semiconductors contain “backdoors,” intentional vulnerabilities that can be exploited for intelligence and military purposes. In 2016, President Xi Jinping said, “the fact that core technology is controlled by others is our greatest hidden danger.” Vice Premier Ma Kai said at the 2018 National People’s Congress, “We cannot be reliant on foreign chips.”1 China intends to end this dependence, but despite 40 years of investment and espionage, it is unable to make advanced semiconductors. Along the way, there have been embarrassing frauds and expensive failures.
Topic:
Science and Technology, Hegemony, Investment, and Emerging Technology
Political Geography:
China and Asia

422. Innocent Bystanders

Author:
Judd Devermont and Catherine Chiang
Publication Date:
04-2019
Content Type:
Working Paper
Institution:
Center for Strategic and International Studies
Abstract:
Speaking at the United Nations General Assembly, President Nana Akufo-Addo of Ghana warned of the repercussions of escalating U.S.-China trade tensions on African nations. Although largely absent from the discourse surrounding the so-called “trade war,” sub-Saharan Africa has suffered from its impacts. Uncertainty hovering over global and African markets has already undermined investor confidence, triggering drops in commodity prices and local currencies. A slowdown in Chinese production and global growth could threaten to throw African markets further off balance. U.S. protectionist measures stand out for their repercussions on African economies and U.S.-Africa relations. Tariff tensions risk indirectly undercutting U.S. goals of promoting African self-reliance, increasing U.S.-Africa trade and investment, and countering China’s expanding influence on the continent.
Topic:
Development, Hegemony, Conflict, and Trade Wars
Political Geography:
Africa, China, Asia, North America, and United States of America

423. Determinants of Developing Countries' Export Upgrading: The Role of China and Productive Investment

Author:
Dic Lo and Yue Teng
Publication Date:
09-2019
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
This paper explores the determinants of developing countries' export upgrading measured by export sophistication. In particular, as a response to the recent debate on China's impact on developing countries' industrialisation, we examine a new hypothesis that the considerable growth in developing countries' trade with China may serve as a source of productive investment for their export upgrading. Dynamic panel estimations based on HS 6-digit export data on 62 developing countries during 1995-2014 show the positive effects of human capital, productive investment, and absolute gains from trade with China measured by income terms of trade vis-à-vis China. Mediation analysis finds that the positive effect of trade with China on export upgrading takes effect largely through its enhancing effect on productive investment, which supports our hypothesis. By contrast, China's direct export-downgrading impact is minor. Our findings suggest that, for developing countries, China serves more as a stimulator of capital accumulation for industrial development than a competitor in manufacturing market or a predator of natural resources. This provides an alternative to the widespread argument of China's crowding-out and re- primarisation impact on developing countries. The priority for developing countries is therefore the appropriate use of the gains from trade for productive purposes.
Topic:
Development, International Trade and Finance, Hegemony, Investment, Exports, and Foreign Interference
Political Geography:
China and Asia

424. U.S. Trade Policy in North America, China, and Beyond

Author:
Andy Green and Daniella Zessoules
Publication Date:
02-2019
Content Type:
Working Paper
Institution:
Center for American Progress - CAP
Abstract:
In recent decades, economic, political, and technological barriers to international trade and investment have collapsed around the world. This rapid globalization of commerce has lifted many out of poverty in developing countries, but due in part to a lack of meaningful labor and environmental standards and enforcement, it has also resulted in an outsourcing of production and jobs as well as downward pressure on workers’ real wages in developed countries such as the United States.1 The key trade agreements and international institutions put in place to manage globalization, such as the North American Free Trade Agreement (NAFTA) and China’s entry into the World Trade Organization (WTO), have failed to rebalance the rules to enable globalization to work on behalf of all workers—not just in the United States, but in Mexico, China, and more broadly. And in many cases, the trade rules have exacerbated economic pressures on many U.S. workers.2 For years, progressive voices in the United States have called for efforts to make globalization work better for working families, communities, and the environment.3 Now, the Trump administration has sought claim to the trade reform mantle. Those claims, however, should be met with skepticism. The 2017 congressional Republican tax law slashed taxes for corporations and the wealthy on the false promise of raising wages for workers.4 Corporate profits, share buybacks, and mergers and acquisitions have all boomed, but working-class wages have barely budged.5 The international provisions of the 2017 tax law further incentivize offshoring operations at the expense of domestic investments and sourcing.6 The Trump administration’s domestic economic agenda of financial deregulation, budget cuts, and attacks on workplace safety and labor rights protections will simply make matters worse for working families. The administration’s record on trade policy has been mixed and largely incoherent. The president railed against NAFTA and other trade agreements for harming workers and U.S. jobs yet renegotiated a new NAFTA deal that fails to make labor and environmental standards meaningfully enforceable.7 His administration has slapped tariffs on adversaries and allies alike with little strategy—often in the name of national security and without addressing the root causes of the problem. Threatening further tariffs, the administration now is engaged in negotiations with China over intellectual property theft, market access for foreign multinationals, and a state-led industrial strategy.8 The president announced a delay in the additional tariffs, suggesting a deal with China is coming together, but concerns have long existed that the administration may settle for high-profile spot sales of U.S. commodities while effectively letting structural impediments and China’s industrial policies continue.9 The cost of what may be President Donald Trump’s high-profile deal with China could be real concessions for the United States, including in the technology and national security space, without providing lasting, solidly enforceable benefits more broadly.10 As U.S. Trade Representative Robert Lighthizer makes his first appearance this week before the new U.S. House of Representatives, the Trump administration will finally have to answer for its approach. Here are several questions that Congress should ask in order to hold the administration accountable to the American people.
Topic:
Security, International Cooperation, International Trade and Finance, and Science and Technology
Political Geography:
China, Asia, North America, and United States of America

425. The Rise of China and the Rebound in Korea’s Manufacturing Employment

Author:
Kyong Hyun Koo and Unjung Whang
Publication Date:
12-2018
Content Type:
Working Paper
Institution:
Korea Institute for International Economic Policy (KIEP)
Abstract:
Over the last three decades, the world has experienced a substantial in-crease in Chinese import penetration due to the rapid improvement in Chi-na’s supply productivity, which is often called the “China shock” or “China syndrome.” The existing literature have shown that the increase in imports from China due to the China shock adversely affected the manufacturing employment of a number of advanced countries such as the U.S., Norway, Denmark, and Spain. Unlike those advanced countries, South Korea has shown a pronounced increase in exports to China as well as imports from China since the 1990s. Over the same time, furthermore, Korea’s manufactur-ing employment has shown a stagnated downward trend compared to other advanced economies and even rebounded since the mid-2000s. Given these motivations, this study investigates both import and export channels to ex-plore how the China trade shocks affected the exceptional trend in Korea’s manufacturing employment from 1993 through 2015. To capture the overall employment effects of the China shocks, specifically, we consider not only how a Korean manufacturing industry employment is affected by the change in its direct exposure to China trade shocks (direct effects), but also how other industries’ changes in exposure to China trade shocks affect the industry through domestic industrial linkages (indirect ef-fects), largely following the empirical approach employed by Acemoglu et al. (2016). Mainly using firm-level data for almost all Korean manufacturing firms with more than four employees and the 2SLS estimation method, we find that during the period 1993-2015 the increase in Chinese import expo-sure had statistically insignificant direct effects on Korea’s manufacturing em-ployment on average, while 1% point increase in Chinese export exposure directly caused 0.18% increase in employment across Korean manufacturing industries. For the indirect effects of China shocks, in contrast, 1% point in-crease in Chinese import exposures of downstream industries (intermediate goods buyers) led to 3.00% decrease in employment of upstream industries (intermediate goods sellers) on average, while 1% point increase in Chinese export exposures of downstream industries brought 1.70% increase in em-ployment of upstream industries on average. The relatively moderate direct effects compared to the indirect ones are partly explained by two factors: First, Korea has gone through a substantial change in the structure of its trade with China since 2000s, so that within-industry supply chains between China and Korea have become more intertwined for some industries. Second, the Korean industries whose main downstream industries were substantially exposed to the Chinese imports (exports) tended to have a relatively low di-rect Chinese import (export) exposure during the period 1993-2015. Based on the 2SLS estimates above, the increased Chinese import expo-sure turns out to have decreased Korea manufacturing employment by 1,210,000 during the period 1993-2015, mainly through the indirect channel. In contrast, the increased Chinese export exposure appears to have increased Korea manufacturing employment by 1,090,000 during the same period, through the direct channel (210,000) and indirect channel (880,000). In the case of Korea’s manufacturing industry, therefore, most of the job reduction attributable to the China shocks has been also offset by job creation caused by the China shocks. Such a considerable increase in manufacturing jobs due to the rise of China, which has not been reported yet in other advanced economies, appear to have played an important role in generating the re-bounding trend in Korea’s manufacturing employment.
Topic:
Globalization, Labor Issues, Economic Policy, and Trade Shocks
Political Geography:
China, Asia, and South Korea

426. A Quantitative Trade Model with Unemployment

Author:
Kyu Yub Lee
Publication Date:
10-2018
Content Type:
Working Paper
Institution:
Korea Institute for International Economic Policy (KIEP)
Abstract:
Over the last decade, quantifying the welfare effects from tariff changes has become one of the main challenges among international trade economists. There are a number of quantitative trade models with micro-foundations which emphasize demand-side (Anderson and Van Wincoop 2003), supply-side (Eaton and Kortum 2002), Bertrand competition (Bernard et al. 2003), extensive and intensive margin (Chaney 2008), etc, and conclude that trade liberalization with tariff reductions leads an economy to reach a higher level of welfare compared to pre-liberalization (Costinot and Rodriguez-Clare 2014). While elegant, these models inducing gravity equations share the common assumption, a perfect labor market. Quantitative trade models with full-employment developed so far have not taken account of labor market frictions when evaluating the welfare effects from tariff changes. This paper aims to fill the gap in the trade literature by explicitly considering labor market frictions. I employ search-and-matching to a multi-country and multi-sector Ricardian model with input-output linkages, trade in intermediate goods, and sectoral heterogeneity, in order to quantify the welfare effects from tariff changes. The paper shows that labor market frictions can be a source of comparative advantage in the sense that better labor market conditions contribute to lower cost in production. Labor market frictions play a critical role in determining the probability of exporting goods to trading partners, and interact with bilateral trade share, price, expenditures, etc. Unemployment and changes in unemployment rates due to tariff reductions contribute welfare changes across countries, implying that welfare effects based on quantitative trade models with full-employment are likely to be biased. I confirm the biased welfare effects by revisiting Caliendo and Parro (2015), who conduct an analysis of the welfare effects from the NAFTA from 1993 to 2005. I show that the welfare gap between theirs and mine has a positive correlation with changes in observed unemployment rates across countries. With the constructed model, I further conduct counterfactual exercises by asking what would happen if China’s tariffs remain unchanged from 2006 to 2015. It turns out that there are mild welfare effects to trading partners in the world trading system.
Topic:
Tariffs, Economic Policy, Trade, Unemployment, and Welfare
Political Geography:
China and Asia

427. Trade Policy Options for ASEAN Countries and Their Regional Dialogue Partners: “Preference Ordering” Using CGE Analysis

Author:
Pradumna B. Rana, Xianbai Ji, Wai-Mun Chia, and Chang Tai Li
Publication Date:
03-2018
Content Type:
Working Paper
Institution:
Centre for Non-Traditional Security Studies, S. Rajaratnam School of International Studies
Abstract:
The withdrawal of the United States from the Trans-Pacific Partnership (TPP) and Trump’s “America First” agenda have ignited a second round of interest in mega-free trade agreements in the Asia Pacific region. Countries have been motivated to explore alternative trade policy options. Using national real gross domestic output gains estimated by the GTAP model to construct “preference ordering” for 10 Association of Southeast Asian Nations (ASEAN) members and their six regional dialogue partners, this paper comes up with several findings. First, when multilateral agreements are not possible, countries are better off with a narrower regional trading agreement than without one. Second, in the region, Regional Comprehensive Economic Partnership (RCEP) has higher beneficial impacts than the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Third, for dual-track countries, that is countries that are negotiating both the CPTPP and the RCEP, implementing both agreements is better than each separately. Fourth, as expected, economic impacts of the CPPTP are lower than those of the original TPP12, but all CPPTP members will benefit although to different degrees. Fifth, economic impacts of open regionalism are higher than those of a closed and reciprocal one. Going forward, the paper argues that ASEAN countries and their regional dialogue partners need to adopt a “multi-track, multi- stage” approach to trade policy.
Topic:
Regional Cooperation, Trans-Pacific Partnership, Free Trade, and Economic Cooperation
Political Geography:
United States, China, Asia, and Asia-Pacific

428. Indonesian Muslims in a Globalising World: Westernisation, Arabisation and Indigenising Responses

Author:
Martin van Bruinessen
Publication Date:
05-2018
Content Type:
Working Paper
Institution:
Centre for Non-Traditional Security Studies, S. Rajaratnam School of International Studies
Abstract:
In the two decades since the fall of the Suharto regime, one of the most conspicuous developments has been the rapidly increasing influence of religious interpretations and practices emanating from the Middle East and more specifically the Gulf states, leading observers to speak of the “Arabisation” of Indonesian Islam. In the preceding decades, the state had strongly endorsed liberal and development-oriented Muslim discourses widely perceived as “Westernised” and associated with secularism and Western education. Indonesia’s unique Muslim traditions have in fact been shaped by many centuries of global flows of people and ideas, connecting the region not just with the Arab heartlands of Islam and Europe but South Asia and China. What is relatively new, however, is the presence of transnational Islamist and fundamentalist movements, which weakened the established nation-wide Muslim organisations (Muhammadiyah, NU) that had been providing religious guidance for most of the 20th century. The perceived threat of transnational radical Islam has led to renewed reflection on, and efforts to rejuvenate, indigenous Muslim traditions.
Topic:
Islam, Religion, transnationalism, and Secularism
Political Geography:
United States, China, Indonesia, Asia, and Southeast Asia

429. Xi Jinping and PLA Transformation through Reforms

Author:
You Ji
Publication Date:
05-2018
Content Type:
Working Paper
Institution:
Centre for Non-Traditional Security Studies, S. Rajaratnam School of International Studies
Abstract:
China’s five-year plan of PLA reform marked a new page in the history of PLA transformation. This article will analyse two major aspects of this round of unprecedented PLA reforms: (i) the politics of the military reform; and (ii) the PLA’s efforts to reshape its force establishments, organisational structure, and command chains. The first concerns Xi’s political leadership and the second draws a roadmap to remould the PLA by 2020. By now the reform has yielded substantial achievements: (i) the overhaul of the apex of power; (ii) the reshaping of the mid-level command chains of the war zone and service; and (iii) the restructuring of the overall force establishments. It has also created some transitional uncertainties as well.
Topic:
Military Affairs, Reform, Political structure, and transnationalism
Political Geography:
China and Asia

430. Game of Institutional Balancing: China, the AIIB, and the Future of Global Governance

Author:
Kai He and Huiyun Feng
Publication Date:
05-2018
Content Type:
Working Paper
Institution:
Centre for Non-Traditional Security Studies, S. Rajaratnam School of International Studies
Abstract:
The establishment of the Asian Infrastructure Investment Bank (AIIB) has signified a “charm offensive” by China towards multilateral institutions and existing global financial governance. If the rise of China is inevitable, what will the future world look like and what should other countries be prepared for? Borrowing insights from institutional balancing theory and role theory in foreign policy analysis, this project introduces a “leadership transition” framework to explain policy dynamics in global governance with the AIIB as a case study. It suggests that China, the US, and other countries have employed different types of institutional balancing strategies, i.e., inclusive institutional balancing, exclusive institutional balancing, and inter-institutional balancing to compete for influence and interest in the process of establishing the AIIB. A state’s role identity as a “leader,” a “challenger,” or a “follower” will shape its policy choices regarding different institutional balancing strategies in the process of leadership transition in global governance. Institutional balancing is a new form of balancing among states in the future of global governance. China’s institutional rise in global governance might be more peaceful than widely predicted.
Topic:
Regional Cooperation, Infrastructure, Governance, and Economic Cooperation
Political Geography:
United States, China, and Asia

431. Securing Energy Supply and Maritime Interests: Seeking Convergence

Author:
Frank Umbach
Publication Date:
10-2018
Content Type:
Working Paper
Institution:
Centre for Non-Traditional Security Studies, S. Rajaratnam School of International Studies
Abstract:
As ASEAN’s energy demand is likely to increase by almost two-thirds in the period up to 2040, the regional oil and gas resources in the offshore zones of the ASEAN member states will become even more important for enhancing the energy supply security of both the individual member states as well as for ASEAN as a whole. Accordingly, access to and political as well as physical control and security of these offshore energy resources will receive even more governmental attention. In context of China’s Belt and Road Initiative as well as South China Sea policies and its energy dimensions, they can fuel already existing maritime competition and conflicts in the South China Sea, the Bay of Bengal, the Indian Ocean and the interconnecting sea lanes and regional choke points. This paper analyses the question to what extent are energy security concepts and challenges are interlinked with maritime policies, particularly in regard to the unresolved overlapping claims in the South China Sea and the perceived intensifying naval competition in the Indian Ocean. It also highlights the strategic implications of ASEAN's rising energy demand and growing exploitation of its offshore maritime energy resources for future regional cooperation, enhanced competition and potential strategic rivalries as well as conflicts.
Topic:
Security, Energy Policy, Oil, Gas, Maritime, and ASEAN
Political Geography:
China, Asia, Indian Ocean, and South China Sea

432. The New Southbound Policy Deepening Taiwan’s Regional Integration

Author:
Bonnie Glaser, Scott Kennedy, and Matthew Funaiole
Publication Date:
01-2018
Content Type:
Working Paper
Institution:
Center for Strategic and International Studies
Abstract:
In a concerted effort to expand Taiwan’s presence across the Indo-Pacific, President Tsai Ing-wen has introduced the New Southbound Policy (NSP) to strengthen Taipei’s relationships with the 10 countries of ASEAN, six states in South Asia (India, Pakistan, Bangladesh, Nepal, Sri Lanka, and Bhutan), Australia, and New Zealand. The policy is designed to leverage Taiwan’s cultural, educational, technological, agricultural, and economic assets to deepen its regional integration. This report tracks the ongoing implementation of the NSP and assesses what has been achieved since Tsai was elected in January 2016. The Guidelines for the New Southbound Policy issued by the Tsai administration detail that the policy is designed to (1) forge a “sense of economy community” by fostering links between Taiwan and the 18 NSP target countries; and (2) establish mechanisms for wide-ranging negotiations and dialogues, and to “form a consensus for cooperation” with NSP target countries. In the short and medium term, the Guidelines identify four goals: (1) use national will, policy incentives, and business opportunities to spur and expand “two-way” exchanges with NSP target countries; (2) encourage industry to adopt “a New Southbound strategy” in their planning; (3) cultivate more people with the skills needed to support the NSP; and (4) expand multilateral and bilateral negotiations and dialogues to enhance economic cooperation and resolve disputes and disagreements.1 The NSP follows from similarly named policies initiated under Presidents Lee Teng-hui and Chen Shui-bian, which were aimed at diversifying Taiwan’s outbound investment away from Mainland China and into Southeast Asia. Since these prior efforts had only a limited impact, skeptics often mischaracterize the NSP as the latest iteration of a failed policy. Such naysayers fail to appreciate, however, that Tsai’s approach is both more strategic and more comprehensive than those of her predecessors. While diversifying and reinvigorating Taiwan’s economy remain fundamental to the NSP, the policy also outlines mechanisms for more effectively integrating Taiwan into the region through cultivating interpersonal connections. Moreover, the NSP is being implemented at a time of slowing growth and rising wages in Mainland China, while investment opportunities are booming in Southeast Asia and South Asia. The core economic goals of the NSP include institutional initiatives, such as updating and expanding economic agreements with targeted countries. At the same time, Taiwan is seeking to encourage small and medium enterprises (SMEs) to explore opportunities overseas. Taipei has also identified avenues for improving bilateral ties by engaging with the general publics of NSP target countries, as well as with government officials and business executives. As such, Taiwan has invested heavily in expanding cultural and educational exchanges to help promote a deeper under- standing of South and Southeast Asian cultures, languages, and business practices among the people of Taiwan. These “people-centered” exchanges serve to realize Taipei’s twin goals of strengthening Taiwan’s integration with the region and facilitating its economic diversification. It is too early to determine whether the NSP will ultimately achieve its ambitious goals, and it may take years before the Tsai government’s investment will start paying dividends. Furthermore, the NSP should be carefully examined by both the countries targeted by Tsai and partners further afield—including the United States. Many of these countries have a vested interest in bolstering the mechanisms available for Taiwan to contribute to the peaceful development of Asia. These countries may find that the goals of the NSP overlap with their own objectives in the region, and therefore may be eager to lend additional support to the endeavor. Selected Policy Recommendations for the United States The United States has a profound interest in the success of Taiwan’s New Southbound Policy. Taiwan has been a long-standing partner of the United States. Its democracy and free society are a beacon of liberal values in the region, while its economic development model has been admired and studied for decades by nations in Asia and beyond. To date, the United States does not appear to have given much thought or expended much effort to support the NSP within Asia. We suggest the United States consider actively supporting the NSP. We recommend the following specific actions: The assistant secretary of state for East Asian and Pacific affairs should coordinate with his/ her counterpart in the South and Central Asia division to create an internal working group to consider how the U.S. government can support the NSP. The U.S. government should engage Japan, Australia, and India, the other members of the “quad,” in support of the NSP. The U.S. government should continue to support Taiwan’s inclusion and active participation in international and regional initiatives where statehood is not required. U.S. nongovernmental organizations (NGOs), particularly those with programs in NSP target countries, should consider partnerships with NGOs in Taiwan to integrate their work where appropriate in support of the NSP. The Commerce Department’s U.S. Commercial Service should engage with American industry associations and companies, and explore potential avenues of collaboration be- tween American and Taiwan industry in NSP target countries. The United States should consider bilateral (U.S.-Taiwan) cultural initiatives that may be brought to third countries in Asia. The United States should include Taiwan youth in relevant regional programs and networks.
Topic:
Agriculture, Education, Regional Cooperation, Science and Technology, Culture, and ASEAN
Political Geography:
Pakistan, Bangladesh, China, India, Taiwan, Sri Lanka, Nepal, and Bhutan

433. Meeting the China Challenge Responding to China’s Managed Economy

Author:
James Andrew Lewis and John J. Hamre
Publication Date:
01-2018
Content Type:
Working Paper
Institution:
Center for Strategic and International Studies
Abstract:
The U.S.-China relationship is one that neither country can escape. Both benefit from it in important ways. The question for quite some time, though, has been whether China’s economy, international presence, and participation in global institutions would come to look more like our own, or whether it would seek to challenge the order the United States has built and led over the past 70 years. While China’s economic size does not necessarily threaten the United States, China’s willingness to use its economic leverage to forge a global economy closer to its image raises complicated questions considering its lack of transparency. The essays in this volume, written by a diverse group of CSIS scholars, address some of the key issues that currently vex the U.S.-China economic relationship.
Topic:
Diplomacy, Global Political Economy, and Economic Cooperation
Political Geography:
United States, China, Asia, North America, and Asia-Pacific

434. The Return of Political Warfare

Author:
Seth G. Jones
Publication Date:
02-2018
Content Type:
Working Paper
Institution:
Center for Strategic and International Studies
Abstract:
The Trump administration’s National Security Strategy and National Defense Strategy outline a U.S. shift from counterterrorism to inter-state competition with China, Russia, Iran, and North Korea. However, U.S. policymakers need to be prepared for much of this competition to occur at the unconventional level, since the costs of conventional and nuclear war would likely be catastrophic. U.S. strategy is evolving from a post-9/11 focus on counterterrorism against groups like al Qaeda and the Islamic State to competition between state adversaries. As the National Defense Strategy notes, “Inter-state strategic competition, not terrorism, is now the primary concern in U.S. national security.”1 This shift has significant implications for the U.S. military, since it indicates a need to improve U.S. capabilities to fight—and win—possible wars against China, Russia, Iran, and North Korea if deterrence fails. Though it is prudent to prepare for conventional—and even nuclear—war, the risks of conflict are likely to be staggering. Numerous war games and analyses of U.S. conflicts with Russia in the Baltics, China in the Taiwan Strait and South China Sea, and North Korea on the Korean peninsula suggest the possibility of at least tens of thousands of dead and billions of dollars in economic damages. In addition, these conflicts could escalate to nuclear war, which might raise the number of dead to hundreds of thousands or even millions. According to one analysis, for example, a U.S. war with China could reduce China’s gross domestic product (GDP) by between 25 and 35 percent and the United States’ GDP by between 5 and 10 percent. The study also assessed that both countries could suffer substantial military losses to bases, air forces, surface naval forces, and submarines; significant political upheaval at home and abroad; and huge numbers of civilian deaths.2 These costs and risks will likely give Washington, Moscow, Beijing, Tehran, and even Pyongyang pause, raising several questions. Will these high costs deter the possibility of conventional and nuclear war? If so, what are the implications for the United States as it plans for a rise in inter-state competition? The Cold War offers a useful historical lens. NATO planners prepared for a possible Soviet and Warsaw Pact invasion of Western Europe. The U.S. military, for example, deployed forces to the Fulda Gap, roughly 60 miles outside of Frankfurt, Germany, as one of several possible invasion routes by Soviet and other Warsaw Pact forces. NATO also planned for nuclear war. The United States built up its nuclear arsenal and adopted strategies like mutually assured destruction (MAD). The concept of MAD assumed that a full-scale use of nuclear weapons by two or more opposing sides would cause the annihilation of both the attacker and the defender. The threat of such heavy costs deterred conflict, despite some close calls. During the 1962 Cuban Missile Crisis, the two superpowers nearly went to war after a U.S. U-2 aircraft took pictures of Soviet medium-range and intermediate-range ballistic nuclear missiles (MRBMs and IRBMs) under construction in Cuba. But Washington and Moscow ultimately assessed that direct conflict was too costly. Deterrence held. Instead, the United States and Soviet Union engaged in intense security competition at the unconventional level across Latin America, Africa, Asia, and Europe. Both countries backed substate groups and states to expand their power and influence. Under the Reagan Doctrine, for example, the United States provided overt and covert assistance to anticommunist governments and resistance movements to roll back communist supporters. The Soviets did the same and supported states and substate actors across the globe. In addition, the Soviets adopted an aggressive, unconventional approach best captured in the phrase “active measures” or aktivnyye meropriatia. As used by the KGB, active measures included a wide range of activities designed to influence populations across the globe. The KGB established front groups, covertly broadcast radio and other programs, orchestrated disinformation campaigns, and conducted targeted assassinations. The Soviets used active measures as an offensive instrument of Soviet foreign policy to extend Moscow’s influence and power throughout the world, including in Europe. Unlike the Cold War, the United States confronts multiple state adversaries today—not one. As the National Defense Strategy argues, the United States is situated in “a security environment more complex and volatile than any we have experienced in recent memory” where “the central challenges to U.S. prosperity and security is the reemergence of long-term, strategic competition by what the National Security Strategy classifies as revisionist powers.” But based on the likely costs and risks of conventional and nuclear war with China, Russia, Iran, and North Korea, much of the competition will likely be unconventional—and include what former U.S. State Department diplomat George Kennan referred to as “political warfare.” The term political warfare refers to the employment of military, intelligence, diplomatic, financial, and other means—short of conventional war—to achieve national objectives. It can include overt operations like public broadcasting and covert operations like psychological warfare and support to underground resistance groups.3 The United States’ adversaries today are already engaged in political warfare. Russia, for instance, utilizes a range of means to pursue its interests, such as technologically sophisticated offensive cyber programs, covert action, and psychological operations. Moscow has conducted overt operations like the use of RT and Sputnik, as well as semitransparent and covert efforts. It has also become increasingly active in supporting state and substate actors in countries like Ukraine, Syria, Afghanistan, and Libya to expand its influence in the Middle East, Asia, Europe, and even North Africa. Finally, Russia is attempting to exploit European and transatlantic fissures and support populist movements to undermine European Union and NATO cohesion, thwart economic sanctions, justify or obscure Russian actions, and weaken the attraction of Western institutions for countries on Russia’s periphery. Iran is using political warfare tools like propaganda, cyber attacks, and aid to substate proxies to support its security priorities, influence events and foreign perceptions, and counter threats. Tehran is also assisting state and substate actors in Yemen, Lebanon, Syria, Iraq, Bahrain, and Afghanistan. Iran supports Shia militia groups in Iraq, Hezbollah in Lebanon, the Bashar al-Assad regime in Syria, and Houthi rebels in Yemen. In the South China Sea, China is pouring millions of tons of sand and concrete onto reefs, creating artificial islands. It is also conducting a sophisticated propaganda campaign, utilizing economic coercion, and using fleets of fishing vessels to solidify its assertion of territorial and resource rights throughout the Pacific. Finally, Beijing is targeting the U.S. government, its allies, and U.S. companies as part of a cyber-espionage campaign. With political warfare already alive and well with the United States’ state adversaries, there are several implications for U.S. defense strategy. First, U.S. policymakers need to be prepared for significant inter-state competition to occur at the unconventional level, since the costs and risks of conventional and nuclear war may be prohibitively high. This should involve thinking through trade-offs regarding force posture, procurement, acquisition, and modernization. A U.S. military that predominantly focuses on preparing for conventional or nuclear war with state competitors—by modernizing the nuclear triad, building more resilient space capabilities, acquiring more effective counter-space systems, equipping U.S. forces with high-technology weapons, and emphasizing professional military education (PME) to fight conventional wars—may undermine U.S. unconventional readiness and capabilities. Second, even organizations that already engage in some types of political warfare—such as U.S. Special Operations Command and the U.S. intelligence community—will need to continue shifting some of their focus from counterterrorism to political warfare against state adversaries. This might include, for example, providing more aid to the Baltic States to conduct an effective resistance campaign against unconventional action by Moscow. Or it might involve aiding proxies in countries like Syria and Yemen to counter Iranian-backed organizations. It could also include improving the border security capabilities and effectiveness of Ukrainian military and police units against Russian-backed rebels. Third, the United States should invest in resources and capabilities that allow the military and other U.S. government agencies to more effectively engage in political warfare—and to provide agencies with sufficient authorities to conduct political warfare. One example is improving capabilities to conduct aggressive, offensive cyber operations. Other examples might include advanced electronic attack capabilities, psychological warfare units, security force assistance brigades, and precision munitions. Recognizing that other powers routinely conduct political warfare, George Kennan encouraged U.S. leaders to disabuse themselves of the “handicap” of the “concept of a basic difference between peace and war” and to wake up to “the realities of international relations—the perpetual rhythm of struggle, in and out of war.” Kennan’s advice may be even more relevant today in such a competitive world.
Topic:
Security, Defense Policy, Nuclear Weapons, Military Strategy, and Counter-terrorism
Political Geography:
Russia, United States, China, Europe, Asia, and North Korea

435. Seven Chinas A Policy Framework

Author:
David Kelly
Publication Date:
02-2018
Content Type:
Working Paper
Institution:
Center for Strategic and International Studies
Abstract:
The debate about China’s changing role in global affairs is often framed as a dichotomous choice between a peacefully rising China that seeks to be a constructive stakeholder and an increasingly dangerous China that is challenging the status quo, both in terms of its norms and the place of the United States. The reality is more complicated. There are not only signs of both elements, but the foundations shaping Chinese behavior is multifold. Most international relations scholars examine China through one or another version of realism or liberalism. David Kelly, head of research at China Policy, offers an alternative approach that examines the nature of Chinese identity, or rather, Chinese identities, plural, and how they exhibit themselves in Chinese foreign policy. Using his renowned skills in reading Chinese-language official documents and the broader commentary, Kelly teases out seven narratives that Chinese tell themselves and the world, and he provides a codebook for explicating shifting Chinese behavior in different arenas. Kelly concludes that some of these narratives facilitate cooperation, but most point toward deep-seated tensions between China and the West in the years ahead.

Topic:
Foreign Policy, Globalization, Imperialism, and Conflict
Political Geography:
United States, China, Asia, North America, and Asia-Pacific

436. Russia's New Nuclear Weapons: Whoever Dies with the Most Toys Wins?

Author:
Anthony H. Cordesman
Publication Date:
03-2018
Content Type:
Working Paper
Institution:
Center for Strategic and International Studies
Abstract:
Whatever his other limitations, Vladimir Putin has shown he is a master in exploiting Russian nationalism and American and European sensitivities. His latest gambit—publicizing new Russian nuclear systems—several of which are still developmental, may have key components that are untested, or do not yet exist—give him political credibility in asserting Russian national strength in a Russian election year, and emphasize the one key area where Russia remains a leading global super power: its possession of nuclear weapons. The key question is whether they represent any real change in the nuclear balance, Russian and U.S. ability to pose an existential threat to the other state, and mutual assured destruction. If they do not, they are more technological status symbols or “toys” than real threats, although the proliferation of such weapons might allow smaller nuclear powers like Iran and North Korea to defeat today’s missile and air defense systems and technologies. An analysis of the actual content of his speech, the changing nuclear and conventional balance between the superpowers—the U.S., Russia, and China, the global balance of deployed nuclear weapons, the shifts taking in US and Russian balance since the Cold War, and as a result of START, the full range of new U.S. and Russian nuclear programs, and of what Putin did and did not say about Russia's new programs, provides a very different picture from the one Putin portrayed in his speech. It shows that Putin focused on the "toy factor" in emphasize technology over any real world aspects of the balance, arms control, and war fighting.
Topic:
Defense Policy, Nationalism, Military Strategy, Authoritarianism, and Nuclear Power
Political Geography:
Russia, United States, China, Europe, and Asia

437. Perspectives on Taiwan Insights from the 2017 Taiwan-U.S. Policy Program

Author:
Bonnie S. Glaser and Matthew Funaiole
Publication Date:
03-2018
Content Type:
Working Paper
Institution:
Center for Strategic and International Studies
Abstract:
The papers in this compendium were written by the 10 members of the 2017 CSIS Taiwan-U.S. Policy Program (TUPP) delegation. TUPP provides a much-needed opportunity for future leaders to gain a better understanding of Taiwan through first-hand exposure to its politics, culture, and history. Each participant was asked to reflect on his or her in-country experience and produce a short article analyzing a policy issue related to Taiwan. These papers are a testament to the powerful impact that follows first-hand exposure to Taiwan.
Topic:
Foreign Policy, Diplomacy, and Regional Cooperation
Political Geography:
United States, China, Taiwan, Asia, and Asia-Pacific

438. The Other Side of the North Korean Threat: Looking Beyond Its Nuclear Weapons and ICBMs

Author:
Anthony H. Cordesman
Publication Date:
03-2018
Content Type:
Working Paper
Institution:
Center for Strategic and International Studies
Abstract:
The United States, South Korea, Japan—and every other state affected by the stability and security of Northeast Asia—has a strong incentive to find a way to end North Korea's nuclear threat and its development and deployment of ICBMs. At the same time, no one can afford to forget that North Korea poses a much wider range of threats from its conventional forces and shorter-range missiles—particularly as it develops ballistic and cruise missiles with precision strike capabilities. U.S. diplomacy and strategy cannot afford to focus solely on nuclear weapons, particularly when North Korea has the option of developing biological weapons with the same lethality as nuclear weapons. The U.S. cannot afford to ignore the conventional threat that North Korea poses to South Korea—a threat that could inflict massive casualties on South Korean civilians as well as create a level of conventional war that could devastate the South Korean economy.
Topic:
Security, Nuclear Weapons, Political stability, and Biological Weapons
Political Geography:
United States, Japan, China, Asia, South Korea, North Korea, and Asia-Pacific

439. A Tale of Three Coal Markets Common Challenges and Unique Attributes of U.S., Chinese, and Indian Markets

Author:
Jane Nakano and Sarah Ladislaw
Publication Date:
03-2018
Content Type:
Working Paper
Institution:
Center for Strategic and International Studies
Abstract:
The United States, China, and India together constitute about 70 percent of global coal consumption and 64 percent of global coal production. Each country is an important contributor to the global coal supply and demand picture and yet each stands at a very different stage in its relationship with coal. The history of coal in the United States is predicated on a long-term decline in its share of the electricity fuel mix, but deep regional socioeconomic ties give the fuel an outsized role in national energy politics. Coal makes up 15 percent of the total U.S. energy mix and 30 percent of the electric power mix while the power sector accounts for about 90 percent of coal use in the United States. Over the years, electricity demand has flattened thanks to strong efficiency gains. Moreover, the abundance of inexpensive natural gas and rapid decline in renewable energy costs have significantly diminished the competitiveness of coal-fired power generation. Unlike in China and India, the U.S. coal fleet is in contraction as a wave of retirements is underway, with little evidence of reversal, indicating that the current downturn appears structural and not cyclical. After a recent period of decline and bankruptcy for the U.S. industry, a political movement to revitalize the coal sector has emerged from the current presidential administration. Notwithstanding the renewed political support, however, the regulatory uncertainty clouds a future pathway for a coal power resurgence. The notion of economic and energy security benefits long associated with the use of coal has effectively disappeared in one of the largest producer and consumer markets for coal in the world. China is far and away the largest coal consumer and has built coal-fired power generation capacity at an unprecedented rate over the past couple of decades. As it enters a new phase of development, China seeks to reduce the role of coal in its economy both to mitigate the environmental impacts of coal production and use but also to harness its domestic power consumption to drive its competitive advantage in things like solar, wind, and nuclear power generation. China has concrete targets to reduce greenhouse gas emissions and ambitious plans, such as a nationwide emissions trading system, that can influence the pace and scope of shift in its power supply mix. Despite these government targets and the ongoing industrial structural reform that can reduce coal’s dominance in the electric power sector, the trajectory for coal use remains significantly subject to the future of state-owned enterprises and economic liberalization. In contrast to the United States and China, India is a fast-growing market for coal where economic development and universal energy access goals often override concerns about environmental pollution and climate change. India also sees enormous opportunity in renewable energy development—for the positive environmental attributes, the potential commercial opportunities, and the ability to lessen reliance on imported sources of energy like oil, gas, and coal. The Indian central and state governments have set up ambitious policies to foster a greater share of renewable energy in the electric power mix. The growth in renewable power-generation capacity shows early indications that renewables as an indigenous resource have the potential to challenge not only coal’s economic advantage but also its energy security value propositions as an indigenous resource, warranting close attention for some potentially valuable lessons for power-sector management in other developing economies where renewables increasingly beat out coal. How India will calibrate its desire to phase out coal imports despite the quantitative and qualitative issues its domestic supply has is another issue with major implications for both global coal markets and the future of its power supply mix, particularly solar and wind. Even as each market navigates a unique set of circumstances surrounding the role of coal-fired power generation, the availability of midstream infrastructure looms large as a universally important determinant of the competitiveness of coal resources, and thus the fuel hierarchy. Railways are the dominant mode for transporting coal in China and the capacity constraints continue to intensify, disadvantaging domestic resources to imports. Midstream is also a major topic in the United States, where a lack of west coast export terminals limits the U.S. ability to take advantage of continued demand growth in Asia. Low utilization rates also reflect the headwinds facing coal-fired power generation in all three countries. For example, U.S. coal-fired power generation experienced a 20 percent decrease in coal fleet utilization rates and a 12 percent decrease in the generation capacity from 2015 to 2016. Also, while China is expected to add another 200 GW of new coal-power capacity by 2020, the utilization rate of 47.5 percent for the thermal power fleet in 2016 indicates a complex nexus between capacity investment and power demand in the country, where the capacity growth does not give a solid indication of electric power output or fuel consumption. The local air pollution and climate implications of coal-fired power generation in each country also depend on the age of their fleet and capital stock turnover. The perceived future direction of coal in each country impacts the willingness of investors to upgrade or build new, more efficient plants. Whereas the ever-weakening coal-power demand in the United States is diminishing investor appetite for new coal plants with higher efficiency, lower emissions (HELE) technology, the capacity expansion in China is enabling the modernization of its fleet that includes more HELE plants. The pace and scope of modernization for India’s coal fleet, which is much younger yet remains low efficiency and high emissions today, will be an important indicator for its future emissions profile. Lastly, various noneconomic forces at play can generate a tension between the needs of a changing electricity market and the political-economic pressures of expanding coal-power capacity. The coal sector enjoys a powerful narrative on its socioeconomic benefits like jobs and tax revenues for coal-mining communities, but enabled by technology advancements, the emerging focus on values like flexibility in the power sector has elevated attributes of many alternative sources of electricity, including renewables and natural gas in the United States. Likewise, the Chinese expansion of coal capacity appears to be misaligned not only with the projected level of power demand growth but also with government efforts to expand alternative sources of electricity, thus raising the risk of stranded or severely underutilized coal plant assets.
Topic:
Energy Policy, Natural Resources, Renewable Energy, and Coal
Political Geography:
United States, China, India, and Asia

440. Security Implications of China’s Military Presence in the Indian Ocean

Author:
Zack Cooper
Publication Date:
04-2018
Content Type:
Working Paper
Institution:
Center for Strategic and International Studies
Abstract:
The issue: China’s increased military presence in the Indian Ocean should not come as a surprise. China is following in the traditional path of other rising powers; it is expanding its military operations to match its interests abroad. The security implications of China’s push into the Indian Ocean region are mixed. In peacetime, these efforts will certainly expand Chinese regional influence. In wartime, however, China’s Indian Ocean presence will likely create more vulnerabilities than opportunities. China’s military forays into the Indian Ocean have triggered a series of warnings. The term “string of pearls” was first used to refer to Chinese basing access in the Indian Ocean by a 2004 report for the U.S. Department of Defense. That report suggested China’s growing regional presence could “deter the potential disruption of its energy supplies from potential threats, including the U.S. Navy, especially in the case of a conflict with Taiwan.” Other scholars have warned that Beijing seeks to “dominate” the Indian Ocean region. Others suggest that the Chinese government is simply following its expanding trading interests and seeking to secure its supply lines against disruption. Although China’s presence in the Indian Ocean may permit it to increase its regional influence, Chinese facilities and forces would be highly vulnerable in a major conflict. Thus, the security implications of China’s push into the Indian Ocean region are mixed. In peacetime, these efforts will certainly expand Chinese regional influence. In wartime, however, China’s Indian Ocean presence will likely create more vulnerabilities than opportunities.
Topic:
Foreign Policy, Diplomacy, Imperialism, Military Strategy, and Maritime
Political Geography:
United States, China, India, Taiwan, Asia, and Indian Ocean

441. China’s Maritime Silk Road Initiative: Economic Drivers and Challenges

Author:
Matthew Funaiole and Jonathan Hillman
Publication Date:
04-2018
Content Type:
Working Paper
Institution:
Center for Strategic and International Studies
Abstract:
The issue: China’s Maritime Silk Road Initiative (MSRI) seeks to connect Beijing with trading hubs around the world. Beijing insists the MSRI is economically motivated , but some observers argue that China is primarily advancing its strategic objectives. This article examines several economic criteria that should be used when analyzing port projects associated with the MSRI. China’s leaders have mapped out an ambitious plan, the Maritime Silk Road Initiative (MSRI), to establish three “blue economic passages” that will connect Beijing with economic hubs around the world.1 It is the maritime dimension of President Xi Jinping’s Belt and Road Initiative (BRI), which could include $1–4 trillion in new roads, railways, ports, and other infrastructure. Within this broad and ever-expanding construct, Chinese investments have been especially active in the Indo-Pacific region, raising questions about whether it is China’s economic or strategic interests that are driving major port investments.
Topic:
Foreign Policy, Imperialism, Maritime, and Trade
Political Geography:
China and Asia

442. Pakistan’s Gwadar Port: A New Naval Base in China’s String of Pearls in the Indo-Pacific

Author:
Gurmeet Kanwai
Publication Date:
04-2018
Content Type:
Working Paper
Institution:
Center for Strategic and International Studies
Abstract:
The Issue The development of Gwadar Port is a key element of the greater China-Pakistan Economic Corridor (CPEC). It speaks to both the strength of the China-Pakistan relationship and the reach of China’s grand strategy. With Pakistan’s two other major ports operating near capacity with no room for expansion, projects in Gwadar promise to eventually handle one million tons of cargo annually, while also providing significant industrial, oil, and transportation infrastructure. Though a “monument of Pakistan-China friendship,” there are misgivings on both sides about CPEC, including the safety of Chinese workers, the resentment of Baloch nationalists, and the growing debt trap created by the project. The prospect of the PLA Navy in Gwadar poses greater security questions, as it forms another link in China’s efforts to expand its maritime presence in the Indo-Pacific region. The members of the Quadrilateral Security Dialogue, or “Quad,” comprised of India, Japan, Australia, and the United States, should counter China’s strategic outreach by networking with other like-minded countries on cooperative security frameworks to ensure a free, open, prosperous, and inclusive Indo-Pacific region.
Topic:
Security, Oil, Regional Cooperation, Global Political Economy, and Trade
Political Geography:
Pakistan, United States, Japan, China, Middle East, India, Asia, and Australia

443. Rebooting U.S.-China Trade Ties: “Enter Ye Through the Narrow Gate”

Author:
Christopher K Johnson
Publication Date:
05-2018
Content Type:
Working Paper
Institution:
Center for Strategic and International Studies
Abstract:
Nearly two weeks after the U.S. “Trade Avengers” unleashed during their visit to Beijing what one reasonably could call “trade shock and awe” with a very aggressive—if thoroughly researched and well-crafted—set of demands targeting the yawning U.S. trade deficit with China and the core of that country’s throaty industrial policy, China this week is taking its turn with the visit of Chinese Communist Party (CCP) Politburo member and Vice Premier Liu He, President Xi Jinping’s economic point man who is almost universally described as a thoughtful, pragmatic, and mild-mannered policy academic. In the interim, voices from a wide swath of official Washington have sounded the alarm about the dangers of Chinese influence operations and the presence of alleged subversives, while President Trump himself seemed to cast aside these growing concerns by suggesting via Twitter that he would ask the Commerce Department to overturn its action against the Chinese telecommunications firm ZTE—long a focus of the U.S. security community for suspected cyber espionage activity and irrefutable violations of U.S. law—in response to protests that reportedly emanated directly from President Xi. With such frenetically sustained action in such a short period of time, the fog of war seems particularly thick at the moment. As such, it seems like a good time to slow down and have a think about how we got here, what actually is going on, and, with a little bit of luck, perhaps think about some ways to craft a viable way forward. Just like milestone birthdays in one’s personal life, important political anniversaries also can incline the mind toward reflection. Next year, of course, marks the fortieth anniversary of the reestablishment of diplomatic ties between the United States and China. As such, much breath and a lot of ink have been devoted to analyzing the course of the bilateral relationship over that nearly half-century. Although certainly not a universal opinion, it seems fair, if perhaps overly reductionist, to suggest that the general conclusion among a substantial number of U.S. officials, policy analysts, and journalists has been that the consistent U.S. policy emphasis on engagement with China during those forty years was, at the end of the day, a sham. In this rendering, naïve groups of senior policymakers in succeeding U.S. administrations and in most of the U.S. China-watching community were hoodwinked by wily CCP leaders who talked the talk of integrating into the so-called U.S.-led rules-based international order, but all the while they had a secret master plan to instead subvert that order and challenge U.S. primacy throughout the globe. In a slightly less menacing (if no less absurd) version of this narrative, China was, indeed, headed generally toward this hoped for integration under the stewardship of deceased paramount leader Deng Xiaoping and his handpicked successors Jiang Zemin and Hu Jintao until Xi Jinping arrived and, through a ruthless consolidation of power, decided instead to change course in what now regularly is referred to in shorthand as Xi’s “authoritarian turn.” But this conclusion seems utterly wrongheaded when examined in the light of hard facts. On the Chinese side of the equation, for example, Deng Xiaoping may have appeared warm and cuddly when donning his cowboy hat during his famous 1979 visit to the United States, but he could be just as ruthless and grasping as any other authoritarian leader. Deng’s exceptionally courageous and dogged pursuit of the policies of reform and opening certainly are worthy of praise, but they cannot, and therefore should not, be separated from the fact that he was content to sit idly by as Chairman Mao’s loyal lieutenant as Mao decimated his political rivals during the Anti-Rightist Campaign (1957-59) and the Great Leap Forward (1958-62). Nor should we forget that Deng used every ounce of his massive personal prestige with the People’s Liberation Army to, with steely determination, rally his many reluctant commanders to execute the brutal Tiananmen crackdown of June 4, 1989. Similarly, Xi Jinping is no Jack-in-the-Box-like figure who has pulled a fast one with a sharp directional turn in the last couple of years made all the more stark after his sweeping consolidation of power at last fall’s 19th Party Congress. In fact, it is this author’s contention, as supported by a large body of written work and public commentary, that everything Xi has done over the last five years was abundantly clear, whether explicitly or in embryonic form—from the moment he was introduced to the world as China’s new top leader in the fall of 2012, as encapsulated in his call for his country to pursue the “China Dream” set on a foundation of “the great rejuvenation of the Chinese nation.” This by no means suggests the United States should express support for, or even acquiescence in, Xi’s policies, but only that it should not be reacting with the borderline hysteria that now seems to be gripping Washington.
Topic:
Security, Diplomacy, Global Political Economy, and Trade Wars
Political Geography:
United States, China, Asia, and North America

444. Shield of the Pacific: Japan as a Giant Aegis Destroyer

Author:
Tom Karako
Publication Date:
05-2018
Content Type:
Working Paper
Institution:
Center for Strategic and International Studies
Abstract:
Several decades ago, former Japanese Prime Minister Yasuhiro Nakasone once described his country as a “big aircraft carrier” from which to defend against Soviet aircraft.1 Although such an analogy fails to capture the richness and depth of the U.S-Japan alliance, it did say something important about Japan’s unique geographic and strategic position. Today’s air and missile threats in the Asia-Pacific region are different, as is the joint U.S.-Japanese defense posture to meet them. Given a handful of changes underway, however, one might instead say that Japan is shaping up to be a giant Aegis destroyer group of sorts. A vision of much more robust air and missile defense capability in the Asia-Pacific region hinges upon the forthcoming acquisition of Aegis Ashore sites in Japan. Japan’s intent to acquire two such sites was announced in December 2017, a decision supported by 66 percent of the Japanese population, according to one recent poll.2 But the potential significance of Japanese Aegis Ashore deployments has not yet been widely understood. Combined with military forces in other domains, these sites will be the foundation of more robust air and missile defenses against North Korea and form a base upon which to adapt to more sophisticated future threats, including China. Assuming the approval process for the foreign military sales comes along well, this development has broad implications for the United States and America’s allies.3 The road to more layered missile defense goes in part through Aegis Ashore, and the road to innovative Aegis Ashore deployments probably goes through Tokyo. The U.S. Navy’s Aegis Combat System has evolved considerably since the first Aegis ship deployed in 1984. Some 90 Aegis ships are currently operated by the United States, and five other countries have Aegis ships as well: Australia, Norway, South Korea, Spain, and Japan. The word “Aegis” refers to the shield of the ancient god Zeus, and Aegis ships have long provided fleet air defense, strike, and antisubmarine warfare. Over the past decade, 35 American and 4 Japanese Aegis ships have also acquired a ballistic missile defense mission. The most recent configurations are capable of executing the integrated air and missile defense (IAMD) mission, with simultaneous air defense and ballistic missile defense operations.
Topic:
Defense Policy, Regional Cooperation, Military Strategy, and Missile Defense
Political Geography:
United States, Japan, China, Asia, South Korea, North Korea, and Asia-Pacific

445. The Korean Civil-Military Balance

Author:
Anthony H. Cordesman
Publication Date:
05-2018
Content Type:
Working Paper
Institution:
Center for Strategic and International Studies
Abstract:
President Trump's cancellation of the summit with North Korea is a warning as to just how difficult it is to bring any kind of stability to the Korean Peninsula and Northeast Asia. It is also a warning that the U.S. cannot focus on the nuclear issue and ICBM, rather than the overall military balance in the Koreas and the impact that any kind of war fighting can have on the civil population of South Korea and the other states in Northeast Asia. The nuclear balance is an all too critical aspect of regional security, but it is only part of the story and military capability do not address the potential impact and cost of any given form of conflict.
Topic:
Diplomacy, Regional Cooperation, Military Strategy, and Conflict
Political Geography:
United States, Japan, China, Asia, South Korea, and North Korea

446. Southeast Asia Financial Integration and Infrastructure Investment: What Role for the United States?

Author:
Murray Hiebert
Publication Date:
05-2018
Content Type:
Working Paper
Institution:
Center for Strategic and International Studies
Abstract:
The Issue Southeast Asia has come a long way since the devastating financial turmoil of 1997 and has set up mechanisms to avoid the next shock. But in case a future crisis hits, it would be useful for the U.S. government to say upfront if it would support International Monetary Fund (IMF) support. Some in the Trump administration have said they oppose IMF bailouts. The newest opportunity—and challenge—to Southeast Asia’s financial system is the bursting onto the scene of fintech firms. These companies are meeting the urgent needs of underserved populations. Yet their activities outstrip the ability of traditional regulators to govern their activities and protect consumers. China’s Belt and Road Initiative could play a mighty role in meeting infrastructure needs in Southeast Asia if it is done right. But so far Beijing has said little about what it envisions the impact of its projects to be. “Will that spending help people who need it most?” asks Jonathan Hillman of CSIS’ Reconnecting Asia Project. “Will it go into viable projects…? Will it help or hurt climate change?” “[I]n countries where public debt is already high, careful management of financing terms [for infrastructure projects] is critical,” IMF Managing Director Christine Lagarde said during a conference in Beijing. “This will protect both China and partner governments from entering into agreements that will cause financial difficulties in the future.”
Topic:
Infrastructure, Global Political Economy, Integration, and Economic Cooperation
Political Geography:
United States, China, Asia, and Southeast Asia

447. Social Innovation and Higher Education in the BRICS (1): a background overview

Author:
Paula R. Cruz, Victor Rebourseau, and Alyssa Luisi
Publication Date:
04-2018
Content Type:
Working Paper
Institution:
BRICS Policy Center
Abstract:
This working paper results from the first phase of the research project on “Social Innovation and Higher Education in the BRICS” conducted by the Research Group on Innovation Systems and Development Governance at the BRICS Policy Center. This research aims to contribute to both the advancement of the scholarly debate on the engagement of HEIs in social innovation initiatives, and the promotion of more inclusive and sustainable development policies in the Global South, particularly in the BRICS.
Topic:
Development, Education, Governance, Innovation, and Higher Education
Political Geography:
Russia, China, India, South Africa, and Brazil

448. Social Innovation and Higher Education in the BRICS (2): a multiscalar governance approach with evidence from DESIS Labs

Author:
Paula R. Cruz, Alyssa Luisi, and Victor Rebourseau
Publication Date:
04-2018
Content Type:
Working Paper
Institution:
BRICS Policy Center
Abstract:
This is the second working paper resulting from the first phase of the research project on “Social Innovation and Higher Education in the BRICS” conducted by the Research Group on Innovation Systems and Development Governance at the BRICS Policy Center. It aims to provide evidence on the ways in which social innovation labs in HEIs in the BRICS countries may operate within a complex, multiscalar governance mode, which a number of local-, national-, and international or transnational level stakeholders participate in.
Topic:
Development, Education, Governance, and Higher Education
Political Geography:
Russia, China, India, South Africa, and Brazil

449. Resourcing Green Technologies through Smart Mineral Enterprise Development

Author:
Salem Ali, Perrine Toledano, Nicolas Maennling, Nathaniel Hoffman, and Lola Aganga
Publication Date:
02-2018
Content Type:
Working Paper
Institution:
Columbia Center on Sustainable Investment
Abstract:
Much has been written in recent years about the urgency to develop new technologies that meet ambitious targets for more efficient energy infrastructure with reduced reliance on fossil fuels. There has also been growing recognition that mineral scarcity can hamper the speed of key technologies being developed. The dominance of China as a global supplier of many technology minerals and the Chinese government’s ability to constrain supply has led to a focus on the international trade dimensions of the challenge. The United States, Japan, the European Union and South Korea have all been keenly focused on securing mineral supply for their domestic industries through a range of initiatives. These efforts have included the World Trade Organization dispute resolution mechanism; research investment in alternative and more widely available materials where possible; and considering strategic stockpiles of minerals from internal sources that harken back to Cold War era strategies for material security. In this report, we argue that a neglected area in addressing the mineral scarcity challenge is the private sector’s current trajectory for geological mineral exploration of key minerals and innovative initiatives on material efficiency and recycling where possible. We term this approach Smart Mineral Enterprise Development (SMED) which entails a partnership between public and private entities to consider pathways whereby public sector data sharing on geology can be coupled with research innovations in the private sector both upstream and downstream of mineral supply. Just as smart energy grids harness efficiencies in electricity supply and demand through a dynamic process of communication, SMED processes can do the same for key technological bottlenecks in mineral supply. We focus on cobalt to highlight the bottlenecks; identify alternative supply sources based on current exploration and recycling technologies; propose ways in which the international legal framework could be adapted to promote investments in critical minerals; and consider ways by which the public sector can assist the private sector in developing a SMED process that would bring forth more efficient and effective entrepreneurial activity to meet our green technology needs.
Topic:
Climate Change, Energy Policy, Science and Technology, Natural Resources, European Union, Green Technology, and Electricity
Political Geography:
United States, China, Europe, Asia, and South Korea

450. China and International Financial Standards: From "Rule Taker" to "Rule Maker"?

Author:
Hongying Wang
Publication Date:
08-2018
Content Type:
Working Paper
Institution:
Centre for International Governance Innovation
Abstract:
Following the global financial crisis, international financial standard-setting bodies granted emerging economies unprecedented representation. Some observers expected the existing system of international financial regulation to be undermined by the larger number of players and their diverging interests from the traditional standard setters. This paper examines whether China, the largest emerging economy, has influenced the international financial regulatory regime. It finds that China has, by and large, been a “rule taker” so far, but points out some important signs of change. It argues that with improved technical capacity, greater stakes in international financial standards and rising structural power, China is poised to increase its participation in the making of international financial standards.
Topic:
Regulation, Global Political Economy, and Fiscal Policy
Political Geography:
China and Asia

451. Made in China 2025 as a Challenge in Global Trade Governance: Analysis and Recommendations

Author:
Anton Malkin
Publication Date:
08-2018
Content Type:
Working Paper
Institution:
Centre for International Governance Innovation
Abstract:
This paper provides a reassessment of Made in China 2025 (MIC 2025) — China’s industrial policy framework aimed at helping the country overcome the much-maligned middle-income trap — in the context of global trade governance. It suggests that China’s industrial policies have been viewed too narrowly — without sufficient attention to longer-term global governance issues — by a large segment of the global business and policy-making community. The paper argues that the general aims of MIC 2025 and the policies that underpin them are not unreasonable, given the increasingly prevalent dilemmas in global trade that China’s leaders are grappling with. These include problems of international development arising from growing global industrial concentration — driven by the growth of the intangible economy — and China’s shrinking access to importing and developing technological components (such as semiconductor chips) that are increasingly characterized as “dual-use” by China’s trading partners. This suggests that resolving the concerns of China’s trading partners regarding China’s industrial policies requires global trade governance reform to ensure an equitable, rules-based global trading order that addresses the legitimate needs of developing and middle-income economies in acquiring foreign-owned technological components and know-how, for the purposes of economic development. The paper concludes by outlining specific recommendations for Canada’s policy makers in improving their economic relationship with China in the context of MIC 2025.
Topic:
Development, Industrial Policy, Science and Technology, Governance, and Free Trade
Political Geography:
China, Canada, Asia, and North America

452. Crisis in the WTO: Restoring the Dispute Settlement Function

Author:
Robert McDougall
Publication Date:
11-2018
Content Type:
Working Paper
Institution:
Centre for International Governance Innovation
Abstract:
The impasse in the World Trade Organization (WTO) over the appointment of new members of the Appellate Body is just one symptom of crisis in cooperation on trade. Driven by skepticism about multilateralism and binding dispute settlement, and by a growing strategic and economic rivalry with China, the current US administration has elevated longstanding US concerns about WTO dispute settlement to new heights. The inability of WTO members to exercise their collective authority to interpret the meaning of their WTO commitments has meant that the Appellate Body is effectively not subject to any checks and balances. As other WTO members blocked US efforts to negotiate more member control, the United States increasingly turned to unpopular unilateral mechanisms, culminating in the current block on new appointments as part of its more disruptive trade policy. Assuming the United States will eventually return to rules-based trade, restoring the WTO dispute settlement system to full capacity and enhancing its legitimacy will likely require some changes. This might include improving mechanisms for political oversight, diverting sensitive issues from adjudication, narrowing the scope of adjudication, improving institutional support and providing members more say over certain procedures. Preserving compulsory, impartial and enforceable dispute settlement in the WTO will require an accommodation of different perspectives on how the system should function. Achieving this, in whatever form, will contribute to maintaining and even strengthening multilateral cooperation on trade.
Topic:
International Trade and Finance, World Trade Organization, Global Political Economy, and Multilateralism
Political Geography:
United States, China, Asia, and North America

453. Taiwan's Place in the Evolving Security Environment of East Asia

Author:
Kharis Templeman
Publication Date:
07-2018
Content Type:
Working Paper
Institution:
Walter H. Shorenstein Asia-Pacific Research Center
Abstract:
In March 2018 the Taiwan Democracy and Security Project, a part of the U.S.-Asia Security Initiative at Stanford University’s Shorenstein Asia- Pacific Research Center, convened a workshop that examined Taiwan’s place in the evolving security environment of East Asia. Participants from the United States, Taiwan, and elsewhere in Asia were experts on a wide array of economic, diplomatic, and security topics. The discussions at the workshop were intended to place Taiwan’s security challenges in a broader regional context, to consider possible obstacles to and opportunities for greater multilateral cooperation on security issues, and to devise a set of recommendations for steps that Taiwan and its friends and partners could take to enhance regional security relationships.
Topic:
International Relations, Security, Military Strategy, and Democracy
Political Geography:
China, Taiwan, and Asia

454. Trade linkages and firm value: evidence from the 2018 US-China "trade war"

Author:
Yi Huang, Chen Lin, Sibo Liu, and Heiwai Tang
Publication Date:
04-2018
Content Type:
Working Paper
Institution:
Centre for Trade and Economic Integration, The Graduate Institute (IHEID)
Abstract:
On March 22, 2018, Trump proposed to impose tariffs on up to $50 billion of Chinese imports leading to a significant concern over the "Trade War" between the US and China. We evaluate the market responses to this event for firms in both countries, depending on their direct and indirect exposures to US-China trade. US firms that are more dependent on exports to and imports from China have lower stock and bond returns but higher default risks in the short time window around the announcement date. We also find that firms' indirect exposure to US-China trade through domestic input-output linkages affects their responses to the announcement. These findings suggest that the structure of US-China trade is much more complex than the simplistic view of global trade that engendered Trump's "Trade War" against China.
Topic:
Economics, International Cooperation, International Trade and Finance, Global Political Economy, Trade Wars, and Exports
Political Geography:
United States, China, and Asia

455. Debating the Quad

Author:
Euan Graham, Chengxin Pan, Ian Hall, Rikki Kersten, Benjamin Zala, and Sarah Percy
Publication Date:
03-2018
Content Type:
Working Paper
Institution:
Australian National University Department of International Relations
Abstract:
In this Centre of Gravity paper, six of Australia’s leading scholars and policy experts debate Australian participation in the ‘Australia-India-Japan-United States consultations on the Indo-Pacific’ - known universally as the ‘Quad’. A decade since its first iteration, the revival of the Quad presents significant questions for Australia and the regional order. Is the Quad a constructive partnership of the region’s major powers to safeguard regional stability, uphold the rules-based order and promote security cooperation? Is it a concert of democracies seeking to contain China? Or is it an emerging strategic alignment that risks precipitating the very confrontation with China it seeks to avoid? Or is it something else entirely? Euan Graham opens the debate by arguing that the Quad represents a rare second chance for Australia to cooperate with regional powers who have a shared interest is the maintenance of stability in Asia through the preservation of a balance of power. In addition to constraining China’s strategic choices beyond its maritime periphery, Dr. Graham argues that the Quad’s revival aims to send a concerted strategic signal to China along the four compass points of the Indo-Pacific region, but sufficiently restrained to avoid significant blowback from Beijing. Chengxin Pan responds that instead of forcing China to change tack, the Quad, by exacerbating China’s strategic vulnerability, will achieve precisely the opposite: prompting it to further strengthen its military capabilities. Dr. Pan argues that the nature of China’s challenge to the existing regional order is actually geoeconomic in design, as evidenced by the Belt and Road Initiative. To meet this challenge, however, the Quad’s military response is far from the right answer or an effective alternative. Ian Hall next argues that the Quad is neither a proto-alliance nor an instrument for containing China. Given that these states have so far failed to advance a coherent and coordinated line on Chinese initiatives to transform the region, Dr. Hall notes that the Quad offers something more prosaic and evolutionary: a forum for discussion and information exchange intended to lead to better policy coordination between like-minded states with a stake in the rules-based order. Rikki Kersten notes that the Japanese government wants Quad 2.0 to be seen as a Japanese initiative because it aspires to lead an ethical endeavour that reaches beyond the Asia-Pacific region. This represents a stepchange in post-war Japanese foreign and security policy thinking. Japan under Abe is seeking to harness rising insecurity to underpin its own regional leadership credentials and enhance the geographical scope of its security policy ambition. Benjamin Zala responds that the potential risks associated with sending containment-like signals to Beijing in the short-term and the potential for misperceptions over ambiguous commitments during a future crisis in the longer-term clearly outweigh the benefits of the current vague aspiration to cooperation with no clear purpose. Dr. Zala also warns against blurring the lines between formal military alliances and strategic partnerships like the Quad which increase the odds of miscalculation during times of power transition. Finally, Sarah Percy rounds out the debate by arguing that discussions of the Quad’s high politics have thus far obscured the more practical and interesting questions about how it might function and contribute to maritime security. Dr. Percy notes that that the day-to-day operations of most navies are focused on the more proximate security challenges posed by maritime crime. The Quad would yield tangible and possibly lasting benefits from such cooperation.
Topic:
Conflict Prevention, Diplomacy, Military Affairs, and Maritime
Political Geography:
United States, Japan, China, India, Asia, and Australia

456. The conventional military balance on the Korean Peninsula

Author:
James Hackett
Publication Date:
06-2018
Content Type:
Working Paper
Institution:
International Institute for Strategic Studies
Abstract:
As US President Donald Trump and North Korean leader Kim Jong-un meet in Singapore on 12 June, it is useful to keep in mind what is at stake. The long-standing tinderbox of the Korean Peninsula, if ignited through another provocation or miscalculation, could spark a full-scale war that could well go nuclear. The prize of diplomacy – sustainable peace on the peninsula – is all the more valuable when one considers the range of military capabilities potentially in play. This information is of use in assessing both the goals of diplomacy and the risks should the current efforts fail. Weapons based on the Korean Peninsula have become faster, more precise and more powerful. North Korea has tested a thermonuclear weapon, an intercontinental ballistic missile and more accurate shorter-range missiles, all designed to offset the relative qualitative weakness of its broader conventional forces. It has also pursued advanced cyber capabilities. South Korea, meanwhile, has focused on developing military systems allowing for more rapid and precise strikes. US forces on the peninsula have introduced yet more advanced capabilities. For these reasons the IISS provides this independent, measured and detailed analysis of military dynamics on the peninsula. The report focuses on the defence policies and military capabilities of the two Koreas, and the US military forces stationed in South Korea which can be brought to bear in a crisis. While it does not ignore unconventional systems, it principally focuses on conventional capabilities. Due to its poverty and isolation, North Korea’s conventional forces have become relatively weaker, compared with those of South Korea and its US ally. Aware of this qualitative inferiority, Pyongyang has invested in asymmetric capabilities, particularly the pursuit of nuclear weapons and ballistic missiles to deliver them. Nonetheless, Pyongyang’s armed forces remain equipped with a wide range of conventional military systems, including large numbers of artillery pieces and multiple-launch rocket systems. Its armed forces, at around 1.2 million, are the fourth-largest in the world. Its conventional military power remains significant, not least because of these numbers (for instance, 4,000 main battle tanks and 8,500 self-propelled- and towed-artillery systems) and the weight of fire they could rapidly bring to bear if employed. Seoul, for instance, is within range of many of North Korea’s artillery systems. North Korea has also developed increasingly advanced cyber capabilities as another aspect of its asymmetric power. The North will continue to improve these, if only to slow the decline in military parity between it and the South. US and South Korean defence authorities assume that the North will, in the event of major conflict, use cyber attacks against South Korean critical infrastructure and command-and-control networks. However, recent events like the Wannacry ransomware attacks have shown that North Korea is now using its cyber power for another purpose: raising revenue to support the regime. Meanwhile, South Korea’s defence policy and military posture is dominated by the security challenge from the North. This has led Seoul to pursue military capabilities, and strategies, designed to defeat North Korean provocations. These range from developments in air-defence, intended to tackle North Korea’s air force and missile capabilities, to strategies designed to pre-empt a potential North Korean provocation. To enable these strategies, South Korea has developed and procured increasingly advanced military systems, ranging from its own Hyeonmu ballistic- and cruise-missiles, to advanced air-to-ground air-launched weapons and, in the next few years, squadrons of F-35A combat aircraft. Working closely with the South Korean armed forces, the US maintains a military presence some 28,500-strong in South Korea, augmented by advanced military systems on the peninsula like the Terminal High-Altitude Area Defense (THAAD) ballistic-missile-defence system, and the military power deployed by the US in the broader Indo-Pacific. This publication builds on the contributions of expert analysts of military power on the Korean Peninsula, and the extensive information holdings available in the IISS Military Balance+ database. It was prepared with the support of the Korea Foundation.
Topic:
Diplomacy, International Cooperation, Nuclear Weapons, and Military Strategy
Political Geography:
United States, Japan, China, Asia, South Korea, and North Korea

457. Reducing the Risk of Iran Developing an ICBM

Author:
Michael Elleman
Publication Date:
08-2018
Content Type:
Working Paper
Institution:
International Institute for Strategic Studies
Abstract:
With the Iran nuclear accord currently on life support, it is not too late to pursue diplomatic measures that address the growing challenge posed by Iran’s ballistic missiles, argues Michael Elleman in a new report. The lack of curbs on Iran’s missile programme was cited by President Donald Trump in May 2018 as one of the principal reasons for withdrawing from the 2015 Joint Comprehensive Plan of Action (JCPOA). With the nuclear accord consequently on life support, it is not too late to pursue diplomatic measures that address the growing challenge posed by Iran’s ballistic missiles. The most promising would be to lock in, through negotiations, the 2,000 kilometre-range limit that Iran has previously stated is its maximum requirement. While this would not reduce the threat perceived by Iran’s regional neighbours, it would forestall development of systems that could target Western Europe or North America. Tehran is not likely to commit to verification measures for such negotiated range limits, however, without receiving something in return. One bargain that could be considered would be to allow Iran to continue its satellite-launch programme, under certain conditions, while capping the maximum range of its ballistic missiles. Such a trade-off may also be relevant to the North Korean case.
Topic:
Diplomacy, International Cooperation, Nuclear Weapons, and Military Strategy
Political Geography:
United States, Japan, China, Asia, South Korea, and North Korea

458. Guardians of the Belt and Road: The Internationalization of China's private security companies

Author:
Meia Nouwens and Helena Legarda
Publication Date:
08-2018
Content Type:
Working Paper
Institution:
International Institute for Strategic Studies
Abstract:
Chinese private security companies are going global to protect the country's assets and citizens, in the sometimes unstable countries linked to Beijing's Belt and Road Initiative. Following the build-up of infrastructure and investment projects along China’s extensive Belt and Road Initiative (BRI), private security companies from China are also increasingly going global – to protect Chinese assets and the growing number of Chinese nationals living and working in countries along the BRI, in sometimes unstable regions. Out of the 5,000 registered Chinese private security companies, 20 provide international services, employing 3,200 security personnel in countries like Iraq, Sudan and Pakistan. The impact of this newly developing Chinese activity abroad is analyzed in this MERICS China Monitor. Chinese private security companies’ international activities pose a challenge to European interests as they are often largely unregulated and their security staff are often inexperienced in dealing with serious conflict situations and combat. EU policymakers, thus, are called upon to encourage and assist Beijing to pass laws regulating Chinese private security companies’ activities overseas.
Topic:
Security, Globalization, European Union, and Private Sector
Political Geography:
China, Europe, Beijing, and Asia

459. China Global Security & Taiwan

Author:
Helena Legarda and Meia Nouwens
Publication Date:
06-2018
Content Type:
Working Paper
Institution:
International Institute for Strategic Studies
Abstract:
The focus of this issue of the China Global Security Tracker is the growing threat that China’s rapid military modernization presents to Taiwan. The People’s Liberation Army has demonstrated its new capabilities through aggressive maneuvers over the last few months, simulating an attack on Taiwan. China’s party and state leader Xi Jinping has left no doubt that he views the reunification with Taiwan as key for China’s future national strength. The China Global Security Tracker is a semi-annual publication. It is part of the China Security Project, a cooperation between the Mercator Institute for China Studies (MERICS) and the International Institute for Strategic Studies (IISS). In her analysis of events during the first half of 2018, MERICS researcher Helena Legarda tracks China’s growing military expenditures as well as steps taken by the Chinese Communist Party to extend its control over the military.
Topic:
Nationalism, Military Strategy, Military Spending, and Military Intervention
Political Geography:
Africa, United States, China, Taiwan, Beijing, and Asia

460. China’s pursuit of advanced dual-use technologies

Author:
Helena Legarda and Meia Nouwens
Publication Date:
12-2018
Content Type:
Working Paper
Institution:
International Institute for Strategic Studies
Abstract:
In its quest to become a global ‘science and tech superpower’ and to build a strong military that can fight and win wars, China has embarked on a major process to achieve civil–military integration (CMI) and develop advanced dual-use technologies. Using various methods both to promote indigenous innovation and to access foreign technology and know-how, China’s goal is to leapfrog the United States and Europe and achieve dominance in these technologies, which will have major civilian and military implications in the future. The EU does not have strong, coordinated strategies to promote the development of indigenous dual-use technologies or to protect Europe’s indigenous innovation. As a result of this patchwork regime, China is either catching up to, or surpassing, European capabilities regarding most of these technologies through a ‘whole-of-government’ regulatory framework and financial investment, as well as by accessing European innovation and technology through a variety of means. For Europe, the incentive to keep up with China’s progress in these technologies, and to protect its own innovation in this field, is one with military, but also commercial and economic, imperatives. At a time when China is increasing its commitment to this process of developing advanced, dual-use technologies, it is high time for Europe to think strategically and take action to leverage its own competitive advantages.
Topic:
Defense Policy, Regional Cooperation, Science and Technology, Military Strategy, and European Union
Political Geography:
United States, China, Europe, and Asia

461. Ministers For Foreign Affairs 1972-83

Author:
Melissa Conley Tyler and John Robbins
Publication Date:
11-2018
Content Type:
Working Paper
Institution:
Australian Institute of International Affairs
Abstract:
The Australian Institute of International Affairs (AIIA) is pleased to present the latest book in the Australian Ministers for Foreign Affairs series. In May 2016 the AIIA held a one-day forum to examine the achievements of Australia’s foreign ministers between 1972-83. This forum and publication is the third book in the AIIA’s Australian Ministers for Foreign Affairs series following on from Ministers for Foreign Affairs 1960-72 and R.G. Casey: Minister for External Affairs 1951-60.
Topic:
Foreign Policy, Cold War, Diplomacy, Human Rights, and International Cooperation
Political Geography:
United States, Japan, China, Indonesia, Asia, and Australia

462. Will North Korea Denuclearize after the Singapore Summit? Lessons from the past

Author:
Naoko Aoki
Publication Date:
07-2018
Content Type:
Working Paper
Institution:
Center for International and Security Studies at Maryland (CISSM)
Abstract:
Policy-makers, scholars, and analysts disagree about whether North Korea will take any meaningful denuclearization steps after its leader Kim Jong Un met with U.S. President Donald Trump in Singapore in June 2018. Many believe that the breakdowns of the 1994 Agreed Framework and the Six Party Talks process in the 2000s show that North Korea’s nuclear weapons program cannot be constrained through cooperation. According to this view, Pyongyang violated its previous commitments once it received economic and political benefits, and it will do so again. The underlying assumption is that Washington was fully implementing its own commitments until Pyongyang broke the deal. But is this true? This paper discusses three key findings drawn from an analysis of U.S. implementation of past denuclearization agreements with North Korea. The first is that the United Stated did not always follow through with its cooperative commitments because of domestic political constraints, even when North Korea was fulfilling its commitments. This makes it difficult to determine whether North Korea ultimately did not honor its obligations because it never intended to or because it was responding to U.S. actions. The second is that some parts of past deals were more susceptible than others to being undercut by domestic opposition because they received insufficient political attention. The third is that such domestic interference could be minimized by obtaining the widest possible coalition of domestic support from the negotiation stage. The roadmap for North Korea’s denuclearization is unclear, as the Singapore summit did not determine concrete steps toward that goal. Secretary of State Mike Pompeo’s visit to Pyongyang in early July also did not yield specifics such as the scope and timeline of denuclearization. But based on the findings from past agreements, this paper argues that the only way for the United States to find out if engagement will work this time is to test North Korea’s intentions by carrying out Washington’s own cooperative commitments more consistently than in the past.
Topic:
Diplomacy, Nuclear Weapons, Military Strategy, Nonproliferation, and Deterrence
Political Geography:
United States, Japan, China, Asia, South Korea, North Korea, and Korea

463. PeSCo – Anything There for European Defence?

Author:
Sandro Knezović
Publication Date:
02-2018
Content Type:
Working Paper
Institution:
Institute for Development and International Relations (IRMO)
Abstract:
The European strategic landscape has changed dramatically over the course of the last decade. The post-Cold War mantra about the obsolescence of conventional threats in the wider European space proved to be short-sighted with developments at its eastern �lanks, while security dysfunctions in the MENA region and their immanent consequences for the safety of European citizens have loaded a heavy burden on compromise-building and decision-making in the �ield of the Common Security and Defence Policy (CSDP) of the EU. Furthermore, the approach of the new US administration to European security and the strategic consequences of Brexit have changed the wider framework in which security of 'the Old Continent' is to be determined, hence stimulating European leaders to rethink European security in a strive for strategic autonomy of their own. The very ambitiously phrased EU Global Strategy that came out in June 2016, served as both catalyst and umbrella document for such an endeavour. However, in order to achieve measurable progress in responding to contemporary security challenges, it was clear that the EU needs to develop a structural way for member states to do jointly what they were not capable of doing at the national level. This is so especially in the environment in which China, Russia and Saudi Arabia are championing the defence spending, right after the US, while European states are signi�icantly trailing behind. The fact that the EU collectively is the second largest military investor and yet far from being among the dominant military powers only emphasises the burning issue of ef�iciency of military spending and the level of interoperability among member states’ armies. High-level fragmentation of the European defence market and the fact that defence industries are kept in national clusters is clearly contributing to that. The reality on the ground is obviously challenging traditional methods of co-operation that operate mainly in ‘national boxes’ and calling for a paradigm change in the wider policy context of CSDP. However, it remains to be seen to which extent will this new security environment actually be able to push the European defence policy context over the strict national boundaries.
Topic:
Security, Economics, Military Strategy, and European Union
Political Geography:
United States, China, Europe, Middle East, Asia, and Saudi Arabia

464. Monitoring Uranium Mining and Milling in China and North Korea through Remote Sensing Imagery

Author:
Melissa Hanham
Publication Date:
10-2018
Content Type:
Working Paper
Institution:
James Martin Center for Nonproliferation Studies
Abstract:
Although uranium mining and milling constitute the first step in any nuclear-weapons program, nuclear nonproliferation analysts have devoted surprisingly little attention to monitoring these processes. Understanding and monitoring uranium mines and mills can provide deeper insight into fissile-material production. This report focuses on the insights gleaned from remotely sensed images of known Chinese uranium mines and mills to understand the current status of uranium mining and milling in North Korea.
Topic:
Nuclear Weapons, Nuclear Power, Surveillance, Mining, and Uranium
Political Geography:
China, Asia, and North Korea

465. Comparative Industrial Policy and Cybersecurity: A Framework for Analysis

Author:
Vinod K Aggarwal and Andrew Reddie
Publication Date:
09-2018
Content Type:
Working Paper
Institution:
Berkeley APEC Study Center
Abstract:
This comparative project evaluates the role of firms, governments, and other key stakeholders in the rise of industrial policy in important states in the cybersecurity industry. In particular, we focus on the U.S., China, Taiwan, Japan, the EU and other key European states. Our goals are as follows: 1) to examine the motivation for government promotion of the cybersecurity industry; 2) to inventory existing measures employed by these countries; 3) to understand the driving forces of cybersecurity industrial policy in these countries; and 4) to examine the likely conflicts that will arise from the competitive pursuit of such industrial policies and how they might possibly be resolved through international cooperation. To this end, we suggest an analytical framework to serve as the comparative structure for this project, drawing on a variety of approaches to understand industrial policy.
Topic:
Science and Technology, European Union, Cybersecurity, and Industry
Political Geography:
Japan, China, Europe, Taiwan, and United States of America

466. The Rise of China as a Cybersecurity Industrial Power: Principles, Drivers, Policies, and International Implications

Author:
Tai Ming Cheung
Publication Date:
09-2018
Content Type:
Working Paper
Institution:
Berkeley APEC Study Center
Abstract:
This paper examines China’s cybersecurity industrial development over the past two decades since the arrival of the internet in that country. This analysis takes place from a primarily security and technology perspective because the national security apparatus occupies a powerful presence in China’s cyber affairs. Moreover, the development of the cybersecurity industry is significantly driven by the development of technological capabilities. Key issues explored include: 1) Chinese decision-making and thinking on cybersecurity development within the context of the Chinese leadership’s general approach to development, national security, and technology advancement; 2) the nature and characteristics of recent Chinese cybersecurityrelated development strategies and plans; 3) the drivers behind the development of China’s cybersecurity industry, looking especially at market failures, national security rationales, and government intervention; 4) the proliferation of principal actors and coalitions in the Chinese cybersecurity industry and how this influences its development; and 5) the nature of the relationship between the state and cybersecurity firms, in particular examining four types of interactions: the state as a customer; state hiring of talent; the state’s direct regulatory power, and the state as an investor. The paper concludes by considering the international implications of China’s rise as an increasingly capable and confident cybersecurity power.
Topic:
Development, Science and Technology, Cybersecurity, and Industry
Political Geography:
China and Asia

467. China’s Carbon Market: Accelerating a Green Economy in China and Reducing Global Emissions

Author:
Yifei Zhang, Jonathan Harris, and Jim Li
Publication Date:
04-2018
Content Type:
Working Paper
Institution:
Global Development and Environment Institute at Tufts University
Abstract:
The National Carbon Emission Rights Trading Market (ETS) Construction Plan (Power Generation Industry) was released in Beijing on December 19 , 2017 by China’s government. As promised during COP23 held in Bonn, Germany in November 2017, this is a key step to fulfilling China’s commitment to the Paris Agreement. The performance of ETS pilot projects in seven provinces of China have been evaluated since October 2011. The supporting policies were also thoroughly analyzed at both local and central government levels. Analysis of the pilot projects shows that the national ETS just initiated in China will not only strengthen supply-side structural reform and carbon-saving patterns of economic growth, but it will also contribute to poverty alleviation by introducing ecosystem valuation into the market. This is a practical application of the “Two Mountain Theory” suggesting that the economic and ecological systems can work in harmony, as proposed by President Xi and emphasized in the 19th National Congress of the Communist Party of China (CPC) on development, poverty alleviation and environmental protection in October 2017. Policy suggestions in terms of economic characteristics, industrial development and regional differences were developed to improve the effects of ETS in China. Taking advantage of differences in the costs of reducing emissions and expanding the size of the trading market are key to success.
Topic:
Climate Change, Environment, Carbon Emissions, and Paris Agreement
Political Geography:
China and Asia

468. China’s 40 Years of Fiscal and Tax Reform: A Basic Trajectory

Author:
Peiyong Gao
Publication Date:
05-2018
Content Type:
Working Paper
Abstract:
The present paper describes the trajectory of China’s fiscal and tax reform in thepast 40 years, which can be summarized in five phases. The reform commenced with“decentralizing power and transferring benefits.” Then, under great fiscal pressure,institutional reform was instigated, which aimed to establish a new fiscal and tax system.To regulate the government revenue and expenditure beyond the fiscal and tax system,reforms were put in place to build an institutional framework for public finance. As thefiscal and tax reform had gradually entered the more sophisticated phases, China took aseries of measures to further improve the public finance system. Since 2012, based on theoverall plan of comprehensively deepening reform, China has embarked on establishinga modern public finance system. The present paper characterizes China’s fiscal and taxreform as gradually moving toward a system that aligns with the overall reform andcomplements the goal of marketization and modernization of state governance.
Topic:
Government, Governance, Finance, Economy, Tax Systems, and Fiscal Policy
Political Geography:
China and Asia

469. China's plans and direction for further opening-up

Author:
Yang Panpan
Publication Date:
08-2018
Content Type:
Working Paper
Abstract:
This year marks the 40th anniversary of China's reform and opening-up, and will be the first year for China to hold the international import expo. This signals that China is further opening up its domestic market and striving to be more integrated with the world. Meanwhile, China is enduring the external uncertainties mainly from its biggest trade partner -- the U.S. One question should be asked: What is China's plan and direction for further opening-up? Since China is shifting from a mid-high-income country to a high-income country, the trajectory of other major developed countries may be a reference for China's further opening-up process. With this in mind, it's necessary to compare the opening-up pattern of these countries with China. One variable might fit this kind of observation -- the foreign value added in one country's final demand. This represent the amount of foreign input used in a country's consumption and investment. Examples include final goods consumed by households, capital goods invested by firms, or intermediate goods used to make products.
Topic:
Markets, Reform, Finance, and Economy
Political Geography:
China and Asia

470. The Development of U.S.-China Trade and the Result of Conflict

Author:
Ma Tao
Publication Date:
06-2018
Content Type:
Working Paper
Abstract:
The very success of globalization has flourished since World War II. The benefits of economic globalization are not evenly distributed among countries, especially among different groups within a country. Before the financial crisis in 2008, as the major promotors of globalization, developed countries intensified their internal contradictions. So populism, protectionism and isolationism are rising in many developed countries, which are the main features of anti-globalization. Brexit happened against the polls in 2016, in large part, because of the migrant crisis tipping the British towards protection of its borders. In the beginning of his presidency, Donald Trump declared to withdraw from TPP, build Mexican border wall, renegotiate NAFTA and so on. Trump’s protectionism policies may be gradually implemented in 2017. Going on like these, the tide of anti-globalization may be further strengthened in the future.
Topic:
Globalization, Bilateral Relations, Foreign Direct Investment, Trade Wars, and Trade
Political Geography:
China, Asia, North America, and United States of America

471. Who Can Win the Possible China-US Trade War?

Author:
Li Chunding
Publication Date:
06-2018
Content Type:
Working Paper
Abstract:
This paper uses a multi-country global general equilibrium (GE) model to numerically simulate the effects of possible China-US trade wars. We introduce an endogenous trade imbalance structure with trade cost into the model which helps to explore both tariff and non-tariff trade war effects. Our simulation results show that China will be significantly hurt by the China-US trade war, but negative impacts are affordable. The US can gain under unilateral sanction measures to China, but will lose if China takes retaliation measures. Comparing the effects under mutual trade war, China will lose more than the US. Introducing non-tariff barrier trade wars will intensify the negative effects, and comparatively negative effects to China are larger than to the US. Mexico’s involvement in trade war with the US will strengthen the negative effects and comparatively hurt the US more. Under non-cooperative and cooperative Nash bargaining equilibrium, the US can gain more than China in trade war negotiation, which means the US has stronger bargaining power than China. Additionally, trade wars between China and the US will hurt most countries and the world especially in GDP and manufacturing employment, but benefit their welfare and trade.
Topic:
Economics, International Trade and Finance, Tariffs, and Trade Wars
Political Geography:
China, Asia, North America, and United States of America

472. U.S.-China Trade Imbalance and the Results of Trade Conflict

Author:
Ma Tao
Publication Date:
04-2018
Content Type:
Working Paper
Abstract:
The very success of globalization has flourished since World War II. The benefits of economic globalization are not evenly distributed among countries, especially among different groups within a country. Before the financial crisis in 2008, as the major promotors of globalization, developed countries intensified their internal contradictions. So populism, protectionism and isolationism are rising in many developed countries, which are the main features of anti-globalization. Brexit happened against the polls in 2016, in large part, because of the migrant crisis tipping the British towards protection of its borders. In the beginning of his presidency, Donald Trump declared to withdraw from TPP, build Mexican border wall, renegotiate NAFTA and so on. Trump’s protectionism policies may be gradually implemented in 2017. Going on like these, the tide of anti-globalization may be further strengthened in the future.
Topic:
Globalization, Economy, Trade, and Protectionism
Political Geography:
China, Asia, United States of America, and North America

473. Who Can Win the Possible China-US Trade War?

Author:
Li Chunding
Publication Date:
03-2018
Content Type:
Working Paper
Abstract:
This paper uses a multi-country global general equilibrium (GE) model to numerically simulate the effects of possible China-US trade wars. We introduce an endogenous trade imbalance structure with trade cost into the model which helps to explore both tariff and non-tariff trade war effects. Our simulation results show that China will be significantly hurt by the China-US trade war, but negative impacts are affordable. The US can gain under unilateral sanction measures to China, but will lose if China takes retaliation measures. Comparing the effects under mutual trade war, China will lose more than the US. Introducing non-tariff barrier trade wars will intensify the negative effects, and comparatively negative effects to China are larger than to the US. Mexico’s involvement in trade war with the US will strengthen the negative effects and comparatively hurt the US more. Under non-cooperative and cooperative Nash bargaining equilibrium, the US can gain more than China in trade war negotiation, which means the US has stronger bargaining power than China. Additionally, trade wars between China and the US will hurt most countries and the world especially in GDP and manufacturing employment, but benefit their welfare and trade.
Topic:
Bilateral Relations, Trade Wars, and Trade
Political Geography:
China, Asia, North America, and United States of America

474. Country-Risk Rating of Overseas Investment from China (2018)

Author:
CROIC-IWEP
Publication Date:
01-2018
Content Type:
Working Paper
Abstract:
China's outbound direct investment hit a new high in 2016, reaching $196.15 billion, making the country the world's second-largest overseas investor. The volume of its outbound direct investment increased by 34.7% year-on-year in 2016 and accounted for 13.5% of the world's total — the first time it exceeded 10%. Since 2003, when the Ministry of Commerce joined hands with the National Bureau of Statistics and the State Administration of Foreign Exchange to start releasing authoritative investment data annually, China's outbound direct investment has kept increasing for 14 consecutive years. From 2002 to 2016, the annual average growth of its outbound direct investment reached 35.8%. In 2016, China's outbound direct investment once again exceeded the foreign direct investment it received, making it a net capital exporter for two consecutive years. Meanwhile, its outbound direct investment stock hit $1.35739 trillion at the end of 2016, the 6th largest in the world, two notches up compared with in 2015. In 2016, China had the most overseas M&A deals in history in terms of both number and value of M&A deals. In the future, China is expected to bring out more of its investment potentials and build a win-win cooperative relationship with other countries following its economic transition and upgrading, rising competitiveness of Chinese enterprises in overseas markets and steady advancement of the Belt and Road Initiative.
Topic:
Economics, Foreign Direct Investment, and Investment
Political Geography:
China and Asia

475. Domestic Constraints on South Korean Foreign Policy

Author:
Scott A. Snyder, Geun Lee, You Young Kim, and Jiyoon Kim
Publication Date:
01-2018
Content Type:
Working Paper
Institution:
Council on Foreign Relations
Abstract:
Despite becoming influential on the world scene, South Korea remains a relatively weak country surrounded by larger, more powerful neigh- bors. This contrast between its global rank as a top-twenty economy and its regional status as the weakest country in Northeast Asia (with the exception of North Korea) poses a paradox for South Korean for- eign policy strategists. Despite successes addressing nontraditional security challenges in areas such as international development, global health, and UN peacekeeping, South Korea is limited in its capacity to act on regional security threats. South Korea has historically been a victim of geopolitical rivalries among contenders for regional hegemony in East Asia. But the coun- try’s rise in influence provides a glimmer of hope that it can break from its historical role by using its expanded capabilities as leverage to shape its strategic environment. The pressing dilemma for South Korean strategic thinkers is how to do so. As the regional security environment becomes more tense, South Korea’s strategic options are characterized by constraint, given potentially conflicting great-power rivalries and Pyongyang’s efforts to pursue asymmetric nuclear or cyber capabilities at Seoul’s expense. South Korea’s relative weakness puts a premium on its ability to achieve the internal political unity necessary to maximize its influence in foreign policy. Students of Korean history will recall that domestic factionalism among political elites was a chronic factor that hamstrung Korea’s dynastic leadership and contributed to its weakness in dealing with outside forces.
Topic:
Foreign Policy, Diplomacy, International Cooperation, Regional Cooperation, and Military Strategy
Political Geography:
China, Asia, South Korea, and North Korea

476. Managing Global Disorder: Prospects for U.S.-China Cooperation

Author:
Council on Foreign Relations
Publication Date:
04-2018
Content Type:
Working Paper
Institution:
Council on Foreign Relations
Abstract:
Emerging challenges to international order require cooperation between the United States and China, two countries that share a common interest in preventing the world from becoming more dangerous and disorderly. U.S.-China relations are becoming more strained and antagonistic, however, and the prospects for cooperation appear to be receding. To explore whether there are still grounds for cooperation on issues of common concern between the two countries, in March 2018 the Center for Preventive Action (CPA) at the Council on Foreign Relations convened a group of fifteen experts from the United States and China for the workshop “Managing Global Disorder: Prospects for U.S.-China Cooperation.” CPA partnered with Peking University’s School of International Studies in Beijing for the workshop and also met with experts at the China Institutes of Contemporary International Relations in Beijing and the Shanghai Institutes for International Studies in Shanghai. During the workshop, President Donald J. Trump announced plans to impose about $60 billion in new tariffs on Chinese imports. While trade was a major topic of discussion, it was by no means the only area discussed. Workshop participants assessed conflicting views of the sources of global disorder and examined areas of global governance such as international trade, development, the environment, and the future of various multilateral institutions. They also discussed the most pressing security challenges in East and Southwest Asia. Participants highlighted the need for a greater understanding between the United States and China on the evolving international order. No major transnational problems will be solved without some cooperation between the two powers. It is therefore imperative that the two countries avoid a further deterioration of the relationship and instead identify areas of potential cooperation.
Topic:
International Cooperation, International Trade and Finance, Tariffs, and Social Order
Political Geography:
United States, China, Asia, and North America

477. The U.S.-Southeast Asia Relationship: Responding to China’s Rise

Author:
Council on Foreign Relations
Publication Date:
05-2018
Content Type:
Working Paper
Institution:
Council on Foreign Relations
Abstract:
Although the Barack Obama administration rhetorically made Southeast Asia a centerpiece of its “rebalance to Asia” strategy, the administration still largely focused on the Middle East and Europe, and Southeast Asia remained a low U.S. policy priority. The Obama administration did try to boost U.S. economic ties with Southeast Asia in 2016 by forging the Trans-Pacific Partnership (TPP), but that trade deal was broadly unpopular in the United States. The following year, the Donald J. Trump administration ended U.S. participation in the TPP, and it also suggested launching punitive economic measures against Southeast Asian states currently running trade surpluses with the United States. Many Southeast Asian leaders now worry that Washington has no clear security or economic strategy for the region, other than applying pressure on Beijing to respect freedom of navigation in the South China Sea. In this perceived void of U.S. leadership and strategy, workshop participants assessed how Southeast Asia might change as China becomes an increasingly dominant regional security and economic actor. They also discussed the future of U.S. strategic and economic relationships with important partners in the region, including Indonesia, the Philippines, Singapore, Thailand, and Vietnam. Participants further considered how China might use its growing leverage in Southeast Asia, and whether Beijing’s tactics could backfire. Finally, several workshop participants posited that the United States, China, and Southeast Asian states could cooperate on at least some nontraditional security issues, such as combating piracy and terrorism.
Topic:
Diplomacy, International Cooperation, International Trade and Finance, and Economic Cooperation
Political Geography:
United States, China, Asia, and Southeast Asia

478. Social Media Celebrities and Neoliberal Body Politics in China

Author:
Anett Dippner
Publication Date:
09-2018
Content Type:
Working Paper
Institution:
The Kolleg-Forschergruppe (KFG)
Abstract:
Since 2015, a new category of media stars came to public awareness and sparked a controversial discussion in China: Internet Celebrities (Wanghong). “Wanghongs” build their fame and fandom mostly on their eyecatching and hyperfeminine appearance which they are presenting extensively on Social Media platforms to gain public attention and acquire followers and fans. The stereotypical so-called “Internet Celebrity face” (Wanghong lian) became the most discussed buzz word of the year 2016 and led to a society-wide discussion about new beauty ideals and the growing popularity of cosmetic surgery, the objectification and commercialization of the body, as well as the increasing importance of an appropriate appearance for the individual’s social and economic success since the 2000s. For tracing these questions, the article analyses the development and characteristics of this new group of celebrities and locates them in the booming “Beauty Economy”. By literally selling their beautiful face, Wanghongs convert symbolic capital through e-commerce and online advertising into real economic advantages. The utilitarization of “body capital” heats up the public discourse about yanzhi (value of a pretty face) in China’s status-conscious society. With an analysis of the so called “Internet Celebrities” phenomenon this paper looks behind the sparkling Social Media façade and reveals the social and economic conditions that led to this new ideology of beauty as capital in China.
Topic:
Mass Media, Internet, Social Media, and Neoliberalism
Political Geography:
China and Asia

479. Russia-India relations: Long-term obstacles remain despite sectoral achievements

Author:
Marcin Kaczmarski
Publication Date:
10-2018
Content Type:
Working Paper
Institution:
Finnish Institute of International Affairs
Abstract:
Despite concrete achievements in energy and military-technical cooperation, long-term trends, such as Russia’s growing dependence on China, India’s tilt towards the US, and tense Sino-Indian relations are not conducive to closer strategic cooperation between Moscow and New Delhi.
Topic:
Foreign Policy, Diplomacy, Energy Policy, and International Cooperation
Political Geography:
Russia, China, Europe, India, and Asia

480. Europe’s connectivity strategy and the challenge of China: Rivalry, reciprocity, or both?

Author:
Bart Gaens
Publication Date:
12-2018
Content Type:
Working Paper
Institution:
Finnish Institute of International Affairs
Abstract:
The EU’s new strategy for connecting Europe and Asia, implicitly a response to China’s Belt and Road Initiative, is an important first step in promoting European priorities in terms of connectivity. However, uncertainties, including those surrounding the financial implications, remain.
Topic:
Foreign Policy, Diplomacy, Regional Cooperation, and European Union
Political Geography:
China, Europe, and Asia

481. The Sino-Russian and US-Russian relationships: Current developments and future trends

Author:
Marcin Kaczmarski, Mark Katz, and Teija Tiilikainen
Publication Date:
12-2018
Content Type:
Working Paper
Institution:
Finnish Institute of International Affairs
Abstract:
The great-power system has been in constant change since the end of the Cold War. The US became the hegemonic power, and under its shelter, the European Union was able to transform into a European-wide political body. Soon, a group of leading regional powers started to question the universalist aspirations of the Western-led international order. Two members of this club in particular were not satisfied with the role of a regional hegemon and had more global ambitions. China has already become the largest trading nation globally, and Chinese foreign policy has assumed an assertive tone. China has both the potential to challenge US hegemony, as well as the political will to use it. Russia’s project to achieve a global great-power status, on the other hand, is inspired by its historical identity and its alleged humiliation by the West after the collapse of the Soviet Union. Russia longs for recognition of its great-power status in particular from the US. This report focuses on relations between China and Russia on the one hand and the US and Russia on the other. It analyses the current developments and future trends in these relationships, as well as their implications for the EU.
Topic:
Foreign Policy, International Cooperation, International Trade and Finance, and Hegemony
Political Geography:
Russia, United States, China, Europe, Asia, and North America

482. Japan’s Free and Open Indo-Pacific Strategy: What does it mean for the European Union?

Author:
Nanae Baldauff
Publication Date:
11-2018
Content Type:
Working Paper
Institution:
EGMONT - The Royal Institute for International Relations
Abstract:
Not so long ago Japan seemed to be left out on the diplomatic stage, notably when it decided not to join China’s newly established Asian Investment and Infrastructure Bank (AIIB) in 2015. But while no one can deny China’s impressive global outreach under the banner of the Belt and Road Initiative (BRI), Japan has not been sitting idly by. Quite the contrary, Japan is playing a leading role in shaping the concept of free and open Indo-Pacific region, and has positioned itself as an important political actor that upholds the rule of law under its Free and Open Indo-Pacific Strategy (FOIP). As China becomes more and more assertive economically and militarily, strengthening ties with Japan becomes all the more important for the European Union (EU). As a strategic partner of Japan, the EU more than ever needs to work with Japan in upholding the liberal international order.
Topic:
Regional Cooperation, Military Strategy, European Union, and Investment
Political Geography:
Japan, China, Europe, Asia, and Indo-Pacific

483. The EU and China: Modest Signs of Convergence?

Author:
Gustaaf Geeraets
Publication Date:
12-2018
Content Type:
Working Paper
Institution:
EGMONT - The Royal Institute for International Relations
Abstract:
Against a background in which the United States is increasingly drawing into question its commitments to free trade and the global commons, the challenge for the EU and China is to deal with a global governance system that is evolving from a multilateral system centred around the US into a more diffuse system resting on the three strong trading poles: China, the EU and the US.
Topic:
International Trade and Finance, Governance, European Union, and Multilateralism
Political Geography:
United States, China, Europe, Asia, and North America

484. War’s Future: The Risks and Rewards of Grey-Zone Conflict and Hybrid Warfare

Author:
David Carment
Publication Date:
10-2018
Content Type:
Working Paper
Institution:
Canadian Global Affairs Institute (CGAI)
Abstract:
Today’s geopolitical conflicts, especially among great powers, involve a desire to fundamentally revise the order of alliances as well as solidify new norms of conduct. The purpose of our paper is to delineate two distinct phenomena in international affairs – hybrid warfare, which emphasizes the tactical level and grey-zone conflicts, which incorporates a long-term strategic dimension into international disputes. We argue that hybrid warfare can be a tactical subset of grey-zone conflict deployed under certain conditions and in varying degrees. We examine four case studies: China’s application of ‘unrestricted warfare’, Russia’s strategy of ‘hybrid balancing’, ‘regional hybridism’ practiced by Israel and ‘restricted hybridism’ applied by Canada/NATO globally. We conclude that the solution to challenges from Russia and China is not a military one but a political and collective one based on baseline requirements for building resilience. Israel, on the other hand, is largely uninterested in the revision of order of alliances and will continue to utilize its tactical advantage vis-à-vis regional neighbors to achieve victories in short conflicts. We conclude that NATO (and Canada) should work more closely with the Organization for Security and Co-operation in Europe and the European Union to effectively extend security guarantees to its members. In doing so Canada and likeminded countries will involve the costs of engaging in hybrid warfare and the subsequent erosion of democratic accountability.
Topic:
NATO, War, Geopolitics, and Hybrid Warfare
Political Geography:
Russia, China, Eurasia, Middle East, Canada, Israel, and Asia

485. The Security Dimension of a China Free Trade Agreement: Balancing Benefits and Risk

Author:
Gordon Houlden
Publication Date:
08-2018
Content Type:
Working Paper
Institution:
Canadian Global Affairs Institute (CGAI)
Abstract:
In 2017, Canada engaged in several rounds of exploratory discussions for a potential free trade agreement (FTA) with the People’s Republic of China. It seemed probable that this exploratory phase would be followed by the opening of formal rounds of negotiations, to be announced during Prime Minister Justin Trudeau’s visit to China in December 2017. An FTA appeared to be a priority for Trudeau since his government came into office in 2015 (Global Affairs Canada, 2017a; Lu, 2017; PMO, 2017); however, such negotiations were put on hold indefinitely, ostensibly due to irreconcilable differences on gender and labour issues. Despite this setback, it is likely that the Canadian government will continue to explore this option in the coming years, particularly with the North American Free Trade Agreement (NAFTA) in jeopardy. While there are many potential benefits of a Canada-China free trade agreement (CCFTA), there are also significant national security implications that will deserve particular attention. The security dimension will be the focus of this paper. Prospective CCFTA negotiations with China would be both complex and time consuming, in part due to the wide divergences between the Canadian and Chinese economies, as well as differences between Canadian and Chinese administrative and legal systems. Negotiations could therefore take several years to conclude, and might not be finished until well after the 2019 federal election. It took a full decade to sign and ratify the China-Australia Free Trade Agreement (ChAFTA), although it appears that the most difficult portion of the negotiations was wrapped up in the final two years. It is unlikely that a CCFTA will move as slowly as the Australian FTA did, in part because of the established Australian precedent and because of China’s increasing familiarity with FTA negotiations that involve advanced economies. For this reason, Canada would benefit from approaching a CCFTA after Australia, but before many other Western countries. Chinese and Canadian negotiators will be consumed with elaborating the principles of each side’s responsive FTA approaches, as well as the myriad of details involving thousands of products and services that a CCFTA’s provisions would affect. Canadian negotiators will seek a high-quality FTA that covers a large percentage of our export and import products with China, as well as an agreement that covers all key sectors and industries. There is also likely to be a Canadian focus on addressing China’s use of non-tariff barriers to trade which currently inhibit Canadian firms from taking full advantage of the massive China market. Such measures include the Chinese Ministry of Health’s 2013 changes to food safety standards which required all imported food products to list detailed nutritional components in Chinese. Procedural barriers such as this represent a significant hurdle for Canadian firms, and cause uncertainty among international exporters that want to break into the Chinese domestic market. In theory, the centralized Chinese economy lacks the regional complexity of the Canadian federal state, characterized by sub-national units, but in reality, China’s provinces and municipalities can, and often do, impose barriers to foreign imports, often to protect market share for local substantive industries. To date, China has FTAs with only a handful of developed countries. Australia, Korea, Switzerland, Iceland, Singapore and New Zealand currently have bilateral FTAs with China, and several others, such as Norway and Israel, are in FTA negotiations. China is also floating ideas for FTAs with developing countries, including India. China is far more trade-dependent than the United States, although by comparison China is not nearly as trade-dependent as Canada is.1 The balance of trade is currently in China’s favour: China exports US$46 billion to Canada, versus the US$16 billion that it imports from Canada (MIT, 2016a). However, it is important to note that China’s exports to Canada account for only 2.2 per cent of China’s total merchandise exports (MIT, 2016b).
Topic:
Security, Intellectual Property/Copyright, Free Trade, and Trade
Political Geography:
China, Canada, Asia, and United States of America

486. The Dragon and Great Power Rivalry at the Top of the World: China’s Hawkish, Revisionist Voices Within Mainstream Discourse on Arctic Affairs

Author:
David Curtis Wright
Publication Date:
09-2018
Content Type:
Working Paper
Institution:
Canadian Global Affairs Institute (CGAI)
Abstract:
This paper discusses China’s Arctic policy white paper, covers China’s appreciation of the region’s strategic value, and samples scholarly articles across the wide spectrum of opinion and policy recommendation regarding China’s participation in Arctic affairs. It describes the articles, offers translated segments from them, and refers readers who want to read more about the articles and more extensive translated passages from them to the Appendix, where they are included in fuller form. This paper’s main contention and conclusion is that the military and strategic dimensions of China’s interests in the Arctic are part and parcel of mainstream Chinese discourse on the Arctic today. One important motivation behind China’s burgeoning interest and engagement in Arctic affairs is the eventual utilisation of the region as strategic space from which to threaten the security of North America. China’s activities in the Arctic bear close, careful, and continuous scrutiny. It is imperative that Canada not succumb to the siren song of complacency and inaction regarding China’s ambitions in the Arctic region.
Topic:
Foreign Policy, Power Politics, Military Affairs, and Geopolitics
Political Geography:
China, Europe, Asia, North America, and Arctic

487. Finding "Win-Win": China's Arctic Policy and What It Means for Canada

Author:
Adam Lajeunesse
Publication Date:
12-2018
Content Type:
Working Paper
Institution:
Canadian Global Affairs Institute (CGAI)
Abstract:
China is a “Near Arctic State” with national interests in Arctic resources, shipping lanes, and regional governance. That was the message delivered to the world in China’s new Arctic policy (China 2018). The philosophy espoused in the Chinese White Paper is one of cooperation and mutual profit – what the Chinese have dubbed “win-win” polar partnerships. These partnerships have been expanding in recent years. Tens of billions of dollars in Chinese capital has flowed into oil and gas projects in Siberia and the Russian Arctic offshore, new shipping routes are being tested, and state-owned mining companies have acquired rich mineral deposits in Greenland and – to a lesser extent – Canada. These resources, and the sea lanes that connect them, have been labelled the “Polar Silk Road,” a maritime trade and shipping route supported by Chinese infrastructure spending (theoretically) running through the Northwest Passage and other circumpolar channels. China’s increasingly confident posture in the North represents real opportunities – and challenges – for Canada. Managed properly, Chinese money can support the decades old Canadian dream of developing the Northwest Passage as a useable sea route, decreasing shipping costs, supporting development and improving the quality of life for Arctic residents. Managed incorrectly, Chinese activity might leave the Asian power with a degree of de facto control over the Arctic, damaging Canadian sovereignty and imperiling the country’s ability to manage this increasingly important region on Canadian terms. This new White Paper is as clear a signal as can be sent that China is coming into the Arctic with long-term strategic ambitions. Canada should not fear this development, but it must be prepared for it.
Topic:
Natural Resources, Geopolitics, and Strategic Competition
Political Geography:
China, Canada, Asia, and Arctic

488. Energy, Trade and Geopolitics In Asia: The Implications for Canada

Author:
Jeff Kucharski
Publication Date:
07-2018
Content Type:
Working Paper
Institution:
Canadian Global Affairs Institute (CGAI)
Abstract:
Canada’s growing interest in trade with countries in the Indo-Pacific region corresponds with an ominous growth in geopolitical instability and insecurity in that part of the globe. With Indo-Pacific hunger for oil expected to soar – especially in China, where demand will translate to 80 per cent of imports in 10 years – Canada needs to develop policies to deal with the region’s turbulent realities. The Indo-Pacific comprises countries in South Asia and Southeast Asia, and includes such unstable and unpredictable players as North Korea and Pakistan, both of which have nuclear weapons and long-simmering border tensions. India is an emerging economic and military rival to China. In the next 20 years, China and India are expected to lead the global demand for gas as coal consumption continues to decline, and Canada has a stake in this prosperous future. Along with territorial squabbles in the region, Canada will have to deal with complex issues such as terrorism, human trafficking, transnational crime, piracy and cyber-crime, as well as the struggle for global dominance between China and the U.S. One key area for potential conflict is China’s recent construction and militarization of artificial islands in the South China Sea. The Canadian government’s new military strategy, Strong, Secure, Engaged does little more than make a plea for peace and the rule of law in the South China Sea. However, more trade crosses the Pacific Ocean from Canada than crosses the Atlantic. And with Canada signing on to the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP), the region’s troubles will need to be resolved by more than good intentions on paper. Canada must shift more diplomatic, security and military resources to the Indo- Pacific; otherwise, its efforts will be spread too thinly to be effective in the region. Trade, especially through a major route like the Strait of Malacca, could easily be disrupted by any one of a number of disputes, such as a conflict between China and Taiwan or if historic resentments boil over among competing territorial claimants in the region. Thus, Canada needs to step up and reaffirm its security commitments to the Association of Southeast Asian Nations (ASEAN) as a partner in the region. Participating in maritime exercises and Freedom of Navigation (FON) operations would also help to reinforce to countries in the region the importance of abiding by international law. Meanwhile, Canada should set aside for now any intentions to negotiate a free trade agreement with China. China does not share some of Canada’s key trade and security goals and its aggressive behaviour in the South and East China Seas clearly signal that now is not the time to talk about a trade pact. China must demonstrate that it is willing to take a more cooperative approach to resolving trade and security issues in the Indo-Pacific and to support and respect the rule of law in the region. Canada has the potential to become a reliable, stable source of energy for Indo-Pacific countries. There is also an opportunity for provinces such as Alberta to strike their own strategic deals to provide energy resources to countries in that region, in return for trade and investment benefits. However, while investing at home in the necessary infrastructure and export capability to expand its role, Canada must also strive to bring its own unique approach to enhancing regional and energy security in the Indo-Pacific.
Topic:
Security, Energy Policy, Geopolitics, and Trade
Political Geography:
China, Canada, Asia, and North America

489. Canada’s Progressive Trade Agenda and a Free Trade Agreement with China: Are They Incompatible?

Author:
Hugh Stephens
Publication Date:
10-2018
Content Type:
Working Paper
Institution:
Canadian Global Affairs Institute (CGAI)
Abstract:
The “non-market” clause in the just-concluded update of NAFTA, now known as the U.S.-Mexico-Canada Agreement (USMCA) would appear to limit Canada’s options in terms of negotiating a free trade agreement with China at the present time (given the de facto U.S. veto over a Canada-China agreement that it provides), yet Prime Minister Trudeau has already reaffirmed Canada’s intention to pursue closer economic ties with China despite this apparent limitation. If negotiations proceed, negotiating a free trade agreement (FTA) with China will be very different from negotiating one with a country that shares Canada’s Western values. However, a trade agreement with China makes good economic sense, and while there are some unique obstacles to reaching such an agreement owing to differing views of progressive trade, these are not insurmountable. In fact, Canada can use the same models in negotiating with China that it has used with Western countries. Such an approach combines trade goals with respecting Chinese cultural and political differences, particularly those that fall into the category of progressivism. This category includes labour rights, Indigenous and gender issues, and governance. Prime Minister Justin Trudeau’s government has been focused on progressive elements in trade deals, while China has made it clear it is not interested in including them in any such pact. Concluding an agreement would mean that China and Canada must both recognize the political requirements and dynamics on the opposite side of the negotiating table, while seeking common ground diplomatically. Side agreements such as those that exist in the original NAFTA and in the Comprehensive Economic and Trade Agreement (CETA) are one way to work with the two countries’ differences. Many of the provisions in a side agreement are not binding and thus not subject to the agreement’s dispute settlement mechanism or trade sanctions. Instead, they are more aspirational and sometimes lay out a process for civil society groups to raise issues and help the thinking on those issues evolve, rather than simply holding the parties accountable for breaches. Canada is rightly concerned about Chinese stances on human rights, labour, environmental and gender issues. However, instead of including these issues in the main document on trade, they can be dealt with as shared interests between the two countries. Establishing separate but parallel mechanisms to deal with these issues would be a practical way to make progress. Focusing on micro, small and medium-sized businesses as one Chapter of the Trans-Pacific Partnership (TPP) did, could be another successful approach. Women own many of these businesses in developing countries, so such a focus would make a substantial contribution to their welfare. None of this means Canada should kowtow to China or look the other way on important values and issues. Side agreements and special focuses have formed parts of agreements with other countries that already share Canada’s Western values. This type of give-and-take is present even when Canada negotiates with countries that are not polar opposites. No country’s interests are exactly the same as those of any other and it’s unrealistic to expect unanimity on every issue. Language and firm commitments on progressive issues are still evolving in many of Canada’s free trade agreements, including the USMCA. It would be unreasonable to hope that everything can be achieved in an agreement with China on the first go-around. Rather, viewing a trade agreement with China as a work-in-progress means controversial elements can be brought into the negotiations and language used that reflects the understanding that these issues are evolving. It will require creative thinking, flexibility and joint commitment to find a solution, but—assuming that the USMCA does not rule out Canada-China negotiations toward a trade agreement— it should be possible to find sufficient common ground without having to resort to obfuscation and “creative ambiguity”.
Topic:
Treaties and Agreements, Bilateral Relations, Sanctions, NAFTA, Free Trade, and Trade
Political Geography:
China, Canada, Asia, and North America

490. China-Israel Relations: Growing Cooperation Amidst Conflicting Interests

Author:
Omer Dostri
Publication Date:
10-2018
Content Type:
Working Paper
Institution:
Jerusalem Institute for Strategy and Security (JISS)
Abstract:
In the past decade, relations between Israel and China have become closer, following a decision in Jerusalem to diversify and expand Israel’s ties with emerging powers and countries that do not belong to the European Union and are less identified with the American coalition. The visit to Israel by China’s vice president is evidence of the warming of relations between the two countries.
Topic:
Diplomacy, International Cooperation, Hegemony, and Emerging Powers
Political Geography:
China, Europe, Middle East, Israel, Asia, North America, and United States of America

491. Not Quite that Close: Israel’s Policy towards China

Author:
Eran Lerman
Publication Date:
11-2018
Content Type:
Working Paper
Institution:
Jerusalem Institute for Strategy and Security (JISS)
Abstract:
Israel’s strategy toward China doesn’t conflict with American interests; rather, it serves and reinforces them. Partnering with Beijing can help stabilize the Middle East. Partnering with Asian nations threatened by Beijing can help build a counterbalance to Chinese power.
Topic:
International Cooperation, Hegemony, Economic Cooperation, and Regional Power
Political Geography:
China, Middle East, Israel, Asia, North America, and United States of America

492. The Future of Latin America and the Caribbean in the Context of the Rise of China

Author:
Dr. R. Evan Ellis
Publication Date:
11-2018
Content Type:
Working Paper
Institution:
Center for Strategic and International Studies
Abstract:
There are numerous analyses about China and its future, as well as about Chinese engagement with Latin America. This report examines, in detail, how the growth of China, with its power and role in the global economy, is likely to transform Latin America and the Caribbean through economic, political, and other forms of engagement with the region. The report considers multiple scenarios regarding the future of China, the resolution of its security challenges, and possible departures from its current trajectory. It focuses primarily on the question of what Latin America and the Caribbean will look like if China succeeds in its ongoing economic and political engagement in the region. Compared to scenario-oriented analyses, this report does not attempt to predict the detailed political ebbs and flows of the region. Instead, it examines economic sectors to understand how the region will be transformed through its intimate economic relationship with China and its part in a global process in which Chinese companies continue to expand their presence in the region. While the report also looks at military issues and the likely evolution of Latin America’s relationship with the United States, it finds equally dramatic implications for China’s willingness to use its soft power in the region. While this report does not claim that China has nefarious objectives to politically dominate the region, or usurp the United States as a superpower, it does find evidence that the logical extension of China’s current expansion plans threatens to relegate the region to a future of limited economic opportunity and personal liberty. This is seen in China’s actions to pursue its development interests, dominate the most lucrative parts of global value chains, and expand China’s power with a questionable level of respect for Western concepts of universal laws, rights, and freedoms. As China continues in the pursuit of these goals, compromised elites serve the transfer of wealth and resources from the Latin American region and other "Belt and Road" region to the new imperial center.
Topic:
International Cooperation, Hegemony, Foreign Interference, and Regional Power
Political Geography:
China, Asia, Latin America, Caribbean, and North America

493. Technological Competition and China

Author:
James A. Lewis
Publication Date:
11-2018
Content Type:
Working Paper
Institution:
Center for Strategic and International Studies
Abstract:
Napoleon’s famous quotation about a sleeping giant moving the world when it awoke seems prescient, but a closer examination presents a more complex story. China’s rise is often accompanied by corresponding predictions of inevitable conflict and U.S. decline. These predictions are simplistic and rest on assumptions of China’s economic and political trajectory that may not be valid. In the near term, competition is unavoidable, and the more important challenge comes from China’s efforts to “return to the center of the world stage” and the means China uses to attain this at a time when the United States is reassessing its global role. The United States and China are in a growing competition, perhaps verging on conflict, but it is not a nineteenth century competition between empires for control of territory and resources. Unlike great power competition in previous centuries, the focal point is not military strength or territorial expansion. This conflict is over control of the modern levers of power—global rules and institutions, standards, trade, and technology. The ability to create new technologies, particularly digital technologies (given their importance for politics, security, and economic growth) have become key factors in the U.S.-China relationship, which is marked by close commercial cooperation and deep governmental distrust. This disparity creates unavoidable tensions. The link between technology, innovation, national security, and international power is now widely recognized. When Vladimir Putin says that the country that leads in artificial intelligence (AI) “will be the ruler of the world,” it is hyperbole, but hyperbole that confirms that political leaders recognize that the ability to innovate is a potent source of national power. In the digital age, national security and national power have different requirements shaped by technological change and cyberspace. Innovation has become a central element of its international influence.1 This is not new—the U.S.-Soviet space race was a contest of the ability of different systems to produce new technologies, but those were unique government programs. Technological competition today is as much between companies as states. A country’s ability to innovate and produce advanced technologies provides economic strength, military power, and an intangible benefit of perceived leadership. Both China and the United States have advantages and disadvantages in this contest, and while it is usual to focus on quantitative aspects—such as the number of engineers or patents and spending on research and development (R&D)—these are not the key determinants of technological competition between states. This competition is a contest of ideas on governance for investment, innovation, and the internet. The internet and global connectivity not only reshape the environment for competition but also create political and market forces that both nations find difficult to control.
Topic:
Science and Technology, Hegemony, and Strategic Competition
Political Geography:
China and Asia

494. The Article II Mandate: Forging a Stronger Economic Alliance between the United States and Japan

Author:
Matthew P. Goodman, Ann Listerud, and Daniel Remler
Publication Date:
12-2018
Content Type:
Working Paper
Institution:
Center for Strategic and International Studies
Abstract:
The alliance between the United States and Japan has been a force for peace and prosperity around the world for nearly 60 years. Economics has been at the heart of the U.S.–Japan alliance from the outset: Article II of the Treaty of Mutual Cooperation and Security mandates that the two allies “seek to eliminate conflict in their international economic policies and … encourage economic collaboration between them.” Nowhere are U.S. and Japanese strategic interests more closely aligned than in the Indo-Pacific region. Both Washington and Tokyo seek to ensure regional security and stability, expand trade and other economic opportunities, and support universal democratic norms. The two countries have worked constructively together for many decades to shape regional economic rules and norms through institutions such as the Asian Development Bank and the Asia-Pacific Economic Cooperation (APEC) forum.
Topic:
International Cooperation, International Trade and Finance, Regionalism, and Economic Cooperation
Political Geography:
Japan, China, Asia, North America, and United States of America

495. China should address downward pressure in 2018

Author:
Qiyuan Xu
Publication Date:
01-2018
Content Type:
Working Paper
Abstract:
In 2017, the Chinese economy rebounded more significantly than expected. There is now general anticipation that growth in 2018 will fall slightly compared with that of 2017, but that it will remain stable at 6.5 percent or above. However, there are some factors that could lead to downward pressure on investment and consumption in 2018
Topic:
International Political Economy and International Affairs
Political Geography:
China

496. From Deng to Xi: Economic Reform, the Silk Road, and the Return of the Middle Kingdom

Author:
LSE Ideas
Publication Date:
01-2018
Content Type:
Working Paper
Institution:
LSE IDEAS
Abstract:
This LSE IDEAS Special Report - with senior contributors from politics, journalism, and academia - looks at the internal causes and consequences of the return of the 'Middle Kingdom'. It explores the extent to which Deng's momentous economic reforms in 1978 have shaped modern China, what the country's expanded international role under Xi means, and who really makes Chinese foreign policy.
Topic:
International Affairs and Global Political Economy
Political Geography:
China

497. The Chinese Perception of the U.S.-China-ROK Triangle

Author:
Yun Sun
Publication Date:
08-2018
Content Type:
Working Paper
Institution:
Korea Economic Institute of America (KEI)
Abstract:
Since being applied to U.S.-Soviet-China trilateral relations after the Sino-American rapprochement in the early 1970s, the notion/theory of “strategic triangles” has been widely used to examine many trilateral relations. The model of “U.S.-China plus one” is popular among students of U.S.-China relations and, consequently, the policy community has witnessed an increasing amount of scholarship on triangles among U.S.-China-India, U.S.-China-Japan, U.S.-China-Russia, and even U.S.-China-Taiwan. Unsurprisingly, this begs the question whether a strategic triangle could be construed and constructed among the United States, China, and South Korea. Generally speaking, despite the trilateral nature of U.S.-China-ROK relations, the Chinese policy community rarely subscribes to the existence of a strategic triangle among the U.S., China, and South Korea. This is not necessarily because South Korea does not carry the same strategic weight as the two great powers, but more importantly is because China does not see South Korea as possessing the strategic autonomy to act as an independent player in the trilateral relations. Although arguably such autonomy might exist in economic and trade relations, on key political and security issues, the Chinese see South Korea as invariably constrained by the U.S.-ROK military alliance and unable to form its own independent national security policy. In writing about the post-Cold War period with an emphasis on geopolitics, Chinese authors do not often treat South Korean policy or Sino-ROK relations as autonomous. Given the great weight given to the U.S. role, it is important, therefore, to take a triangular approach in assessing these writings centered on South Korea. I do so first explaining in more detail why the “strategic triangle” framework does not apply, then examining views on how this triangle has evolved in a period of rising Chinese power relative to U.S. power and fluctuating U.S.-ROK relations as the leadership in Seoul changed hands, and finally returning to the triangular theme to grasp how this shapes China’s understanding of Seoul’s policies with emphasis on the ongoing Moon Jae-in era.
Topic:
International Relations, Foreign Policy, Geopolitics, Economy, and Trade
Political Geography:
China, Asia, and South Korea

498. Financing Green Growth

Author:
Gregor Semieniuk and Mariana Mazzucato
Publication Date:
04-2018
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
This paper surveys the current state of financing green growth in the energy sector, based on the insight that there are different qualities of finance. In past transformational changes in other sectors, public monies played a key role across the innovation landscape. Public financing was central also in a number of past national energy transitions, as reviewed here for Iceland (from fossil to geothermal energy), Norway (from mainly non-electricity energy to hydroelectricity), France (from oil to nuclear) and the United States (from conventional to shale gas). In the current transition to low-carbon energy supplies, there is much public activity, most directed and concerted in China, but also reasons to doubt it is enough and applied in the right places to be able to finance the transition to a low carbon sector on time scales consistent with current climate change mitigation targets. A discussion of opportunities and challenges to a more central role for public financing concludes, drawing also on insights from the recent mission-oriented innovation literature.
Topic:
Energy Policy, Finance, Green Technology, and Renewable Energy
Political Geography:
China, Europe, Asia, France, North America, Iceland, and United States of America

499. American Radical Economists in Mao’s China: From Hopes to Disillusionment

Author:
Isabella M. Weber and Gregor Semieniuk
Publication Date:
10-2018
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
American radical economists in the 1960s perceived China under Maoism as an important experiment in creating a new society, aspects of which they hoped could serve as a model for the developing world. But the knowledge of ‘actually existing Maoism’ was very limited due to the mutual isolation between China and the US. This paper analyses the First Friendship Delegation of American Radical Political Economists (FFDARPE) to the People’s Republic of China in 1972, consisting mainly of Union for Radical Political Economics (URPE) members, which was the first visit of a group of American economists to China since 1949. Based on interviews with trip participants as well as archival and published material, this paper studies what we can learn about the engagement with Maoism by American radical economists from their dialogues with Chinese hosts, from their on-the-ground observations, and their reflection upon return. We show how the visitors’ own ideas conflicted and intersected with their perception of the Maoist practice on gender relations; workers’ management and life in the communes. We also shed light on the diverging conceptions of the role for economic expertise between URPE and late Maoism. As the first in-depth study on the FFDARPE we provide rich empirical insights into an ice-breaking event in the larger process of normalization in the Sino- U.S relations, that ultimately led to the disillusionment of the Left with China.
Topic:
Radicalization, Capitalism, Economic Theory, Transition, and Socialism
Political Geography:
China, Asia, North America, and United States of America

500. The Mainstream Economics Interpretation of the Local State and Central-Local Relations in Post-Mao China: a Critical Review

Author:
Alexandre De Podesta Gomes
Publication Date:
11-2018
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
Decentralization and the role of local governments have long been touted as key factors in the Chinese economic miracle. This paper intends to critically assess the chief theories advanced by mainstream economics in its attempt to make sense of these aspects of China’s growth story. Firstly the theoretical underpinnings of fiscal federalism, new institutional economics, and market-preserving federalism approaches will be presented, as these theories offer the bedrock for most of the applied insights in which China is framed through the lenses of the central-local relations debate. Secondly, the idea of ‘market-preserving federalism, Chinese-style’ will be critically appraised, highlighting its shortcomings. Thirdly, the paper proceeds by bringing in the mainstream response to these problems, relying on the notion of political incentives and career concerns faced by local cadres. It will be argued that the continual adherence to some core tenets dear to the new institutional economics literature in all previous explanations prevents this broad camp of knowledge to properly grasp the complex dynamics of China’s decentralization drive and the role of local governments in the process. Finally, and in closing, an alternative approach will be offered.
Topic:
Economics, Local, Decentralization, and Federalism
Political Geography:
China and Asia