Content Type: Working Paper / Political Geography: China

201. How China and Pakistan Negotiate

Author:: Katharine Adeney and Filippo Boni
Publication Date:: 05-2021
Content Type:: Working Paper
Institution:: Carnegie Endowment for International Peace
Abstract:: Since being officially launched in April 2015, the China-Pakistan Economic Corridor (CPEC) has been one of the most watched set of projects under the aegis of Chinese President Xi Jinping’s signature Belt and Road Initiative (BRI). Having already injected around $25 billion into Pakistan, the CPEC not only has been dubbed the “flagship project” of the BRI, but it also holds a central role in Beijing’s global ambitions.1 While much has been said about the geopolitical implications of the CPEC, including for both India and the United States, less attention has been devoted to providing in-depth insights into the mechanics of how the BRI is unfolding on the ground in Pakistan. How do China and Pakistan negotiate the terms of CPEC deals? To what extent has Islamabad managed to exert agency in its dealings with Beijing? How does China adapt to the contexts it operates in? By now, the CPEC has been subject to much media, academic, and policy scrutiny, but these questions have not been answered. The power asymmetry between the two partners—coupled with the impression that the BRI represents a unidirectional Chinese endeavor, not just in Pakistan but also globally—has contributed to the erroneous representation that Beijing is merely imposing the CPEC on its all-weather partners in Islamabad. On the contrary, this study highlights China’s adaptive strategies in dealing with a host of Pakistani actors (including political parties, local communities, and the military) against the backdrop of Pakistan’s evolving political landscape and change in leadership following the country’s 2018 elections. In filling this gap, this paper foregrounds the importance of adopting a relational approach to studying how the BRI unfolds on the ground. This entails looking at how Pakistan and China have negotiated the CPEC’s energy, infrastructure, and industrial cooperation projects. The analysis is based on semi-structured elite interviews conducted by the two authors during three rounds of fieldwork in 2015, 2018, and 2020–2021 triangulated with a host of official reports, statements, and newspaper articles. Examining the domestic contours of the CPEC shows that Pakistani actors have wielded agency in important ways throughout the process, while Chinese actors at times have accommodated key Pakistani demands.
Topic:: Energy Policy, Bilateral Relations, Geopolitics, Economy, and Belt and Road Initiative (BRI)
Political Geography:: Pakistan, China, South Asia, and Asia

202. The Hidden Face of Informal Cross-Border Trade in Tunisia After 2011

Author:: Hamza Meddeb
Publication Date:: 05-2021
Content Type:: Working Paper
Institution:: Carnegie Endowment for International Peace
Abstract:: Despite the heavy-handed approach to security that has been adopted at Tunisia’s land borders, informal cross-border trade continues to thrive. Land corridors have been shut down, but the continued dynamic activity in maritime corridors has compensated for this loss, allowing Turkish and Asian consumer goods adapted to the declining purchasing power of the Tunisian population to penetrate local markets. The dynamism of Tunisia’s maritime corridors owes much to the emergence of small entrepreneurs and underprivileged outsiders who operate informally through trade networks connecting Tunisian and Asian ports. Some well-established firms also have adopted informalization strategies to circumvent trade barriers and restrictions against bilateral trade between Turkey and Tunisia. The rise of these informal networks and approaches reflects a growing trend: the progressive shift of Tunisia’s trade away from Europe and the rise of Turkey and China as major trade partners.
Topic:: Borders, Trade, and Informal Economy
Political Geography:: China, Europe, Turkey, North Africa, and Tunisia

203. The Local Roots of Chinese Engagement in Pakistan

Author:: Muhammad Tayyab Safdar
Publication Date:: 06-2021
Content Type:: Working Paper
Institution:: Carnegie Endowment for International Peace
Abstract:: China has deepened its economic engagement with Pakistan through elite-centered negotiations over the routes and projects of the China-Pakistan Economic Corridor (CPEC). But elites are not the whole story: China has made inroads beyond Pakistan’s political elites with a broader array of local stakeholders in the country’s education, media, and energy sectors. Pull factors in each of these areas are giving local Pakistani actors incentives to develop closer relationships with Chinese actors. In education, China’s status as a rising global power and the promise of future economic returns have driven ever more Pakistanis to learn Mandarin and opt to study abroad in China. In the media sector, the financial pressures facing Pakistan’s private media houses have contributed to increasing domestic buy-in for news sharing agreements with Chinese media organizations. In the power sector, the lack of alternative sources of external funding for local Pakistani conglomerates has resulted in the emergence of joint ventures on electricity generation projects with large Chinese state-owned enterprises (SOEs). At the same time, Chinese government policies are serving as push factors to incentivize Chinese actors to expand their interactions in different segments of Pakistani society. For example, China has opened and sponsors Confucius Institutes and classrooms across Pakistan, while also offering scholarships to Pakistani students interested in studying in China. As Chinese firms have expanded their presence in Pakistan, they have worked with local universities to adapt to local customs and cultural and religious values. In media circles, stakeholders like China’s Xinhua News Agency have worked with local Pakistani media outlets to localize information dissemination and shape Pakistani public opinion on important international issues in ways that are in sync with Beijing’s worldview. And Chinese investment in Pakistan’s power sector is aligned with Chinese SOEs’ Go Global strategy and the expansion of these firms’ operations in overseas markets as part of the BRI. China’s engagement with Pakistani political, social, and economic institutions comes in response to local conditions. By adapting to these conditions and working through local institutions and actors, a host of Chinese actors are poised to continue deepening their interactions with different parts of Pakistani society.
Topic:: Education, Partnerships, Media, Economy, and Engagement
Political Geography:: Pakistan, China, South Asia, and Asia

204. How Duterte Strong-Armed Chinese Dam-Builders But Weakened Philippine Institutions

Author:: Alvin Almendrala Camba
Publication Date:: 06-2021
Content Type:: Working Paper
Institution:: Carnegie Endowment for International Peace
Abstract:: Chinese construction contracts and development finance have increased massively in recent years. According to many experts, these projects are largely transplants designed to offshore and export Chinese technology, labor, and policy designs to host countries. However, these views have little regard for important nuances of place, time, and politics, ignoring the degree to which host countries—such as local elites, members of civil society, and norms—shape project design, implementation, and results on the ground. Under the regime of President Rodrigo Duterte, political elites in the Philippines have pressed Chinese firms to adapt to some of their demands for political expediency on key infrastructure projects. This pattern is evident from the Kaliwa Dam and the Chico River Pump Irrigation Project—both of which have made substantial progress during Duterte’s rule. In particular, Manila has bypassed local social and environmental regulations and has paved the way for Chinese dam builders to break ground on projects quickly so as to strengthen the Duterte government’s political standing. Around the world, Chinese firms have been highly attentive to the will of local political elites, limiting or sometimes completely avoiding relationships with opposition elites and ties to civil society members. Philippine politics is turbulent. Projects supported by the Duterte regime today might not have the same traction under his successor. So while these Chinese concessions have earned favor with Duterte and his allies, such tactics may prove unsustainable over the long term and could easily spur future resentment against China among local communities marginalized by this decisionmaking. In sum, it is Filipinos, not Chinese actors, who mostly have set the agenda on these major infrastructure projects, except on a few specific contractual terms.
Topic:: Development, Politics, Infrastructure, Rodrigo Duterte, and Construction
Political Geography:: China, Philippines, and Asia-Pacific

205. What Railway Deals Taught Chinese and Brazilians in the Amazon

Author:: Adriana Erthal Abdenur, Maiara Folly, and Maurício Santoro
Publication Date:: 08-2021
Content Type:: Working Paper
Institution:: Carnegie Endowment for International Peace
Abstract:: Over the past decade, Chinese investments in Brazil have expanded and diversified considerably, especially ones involving infrastructure. Chinese investors have also diversified geographically. Increasingly, major Brazilian infrastructure projects are being planned or implemented with Chinese backing in environmentally sensitive regions such as the Amazon rain forest and the Cerrado, a large savanna region in Central-West Brazil. Chinese actors have become directly involved in such projects against a backdrop of sharpening debates about sustainability and other consequences of large-scale infrastructure projects. This is especially true in protected areas such as land populated by Indigenous groups and conservation units. A notable example is the Ferrogrão project, a major railway line designed to cross sections of the Amazon and Cerrado to deliver goods to Brazilian ports. This paper examines the diverse ways that Brazilian and Chinese actors have learned from each other as they negotiate the terms of these deals. It also explores how these learning processes have been conditioned by intense domestic political debates over these projects in Brazil. Official documents and secondary sources reveal that, rather than a set Chinese way of doing business or a stock Brazilian response, such projects entail dynamic institutional learning. Such learning is shaped not only by the particulars of the Ferrogrão project but also by Chinese actors’ broader engagement with Brazilian infrastructure projects over the past ten years.
Topic:: Environment, Infrastructure, Investment, and Sustainability
Political Geography:: China, Asia, Brazil, South America, and Amazon Basin

206. China’s Digital Yuan: An Alternative to the Dollar-Dominated Financial System

Author:: Rajesh Bansal and Somya Singh
Publication Date:: 08-2021
Content Type:: Working Paper
Institution:: Carnegie Endowment for International Peace
Abstract:: Central bank digital currencies (CBDC) are digital tokens issued by central banks. In a way, they are the digital version of cash; their value is guaranteed by a central bank. Unlike money held in credit cards and mobile wallets, CBDCs are not a mere representation of physical money stored elsewhere. Instead, they are a complete replacement for currency notes. While several countries are developing their digital currencies, China is well positioned to take the lead with the digital yuan. This paper highlights ways in which China can use its digital yuan to internationalize the renminbi (RMB) and gradually chip away at the hegemony of the dollar. The first part of the paper focuses on the dollar’s dominance in the global financial system and the privileges the United States accrues as a result of the dollar being the world reserve currency. The United States has a tight grip on the world’s payment rails, especially in the case of cross-border transactions. For example, the Society for Worldwide Interbank Financial Telecommunications (SWIFT)—the largest cross-border payment clearinghouse in the world—has to comply with and implement unilateral U.S. sanctions. These sanctions seriously hinder trade and damage the economies of the countries affected by them, as was the case with Iran, which lost $150 billion worth of revenue as a result of U.S. sanctions.1 Once a country is cut off from SWIFT’s network, it becomes extremely difficult for it to trade with the rest of the world. Thus, via the dollar’s dominance and its geopolitical muscle, the United States is positioned to maintain a tight grip on the world’s financial system. In an increasingly multipolar world, this outdated, decades-old system of the dollar as the apex currency and the United States’ position of power that allows it to pursue its own geopolitical interests has become outdated. The U.S. dollar’s hegemony has been challenged by economies like those of the European Union (EU), Russia, and China. Of all the countries, China finds itself in a dominant position to gain from this transition. In order to challenge the dollar’s hegemony and internationalize its currency, China will have to move away not just from the dollar but also from the payment rails dominated by the dollar. The best way to simultaneously do both would be to introduce a new payment rail like CBDCs. This paper analyses the way the launch of China’s CBDCs could greatly enhance its currency internationalization prospects. Considering China’s growing economy and influence over the world, the paper argues that China’s CBDC launch could bring a period of momentous change in the global financial system. In order to challenge the dollar, China will have to build the payments infrastructure required to facilitate the use of its digital yuan. It will also have to incentivize other countries to adopt its digital currency. China’s ability to successfully promote its currency using CBDCs will depend heavily on the country’s ability to relax capital controls and maintain the world’s trust in its institutions. China’s geopolitics will play a key role here. In the last decade, some of China’s major geopolitical efforts have set the stage for its CBDC launch. As China continues to use its foreign policy and technological capabilities to grow its influence in the global financial system, the launch of the digital yuan could be a significant step forward in this direction. This paper examines the reasons for China’s past efforts at currency dominance and explores ways in which the country can use its CBDC to further internationalize its digital yuan.
Topic:: Foreign Policy, Finance, Economy, Central Bank, and Currency
Political Geography:: China and Asia

207. Chinese Mining and Indigenous Resistance in Ecuador

Author:: Cintia Quiliconi and Pablo Rodriguez Vasco
Publication Date:: 09-2021
Content Type:: Working Paper
Institution:: Carnegie Endowment for International Peace
Abstract:: Chinese mining companies were drawn to Ecuador by a strong interest in diversifying their sources of copper in Latin America. But Chinese mining operations in Ecuador, which could have contributed to Ecuadorian development, soon gained a negative reputation after these activities prompted a great deal of local pushback, especially from affected Indigenous communities. As a result, the major Chinese mining consortium that now controls Ecuador’s two main copper mines has taken adaptive steps to stabilize its mining investment and increase the security of its supply networks, steps that often have not produced the intended results. Working through two subsidiaries, the Chinese mining consortium has responded to this localized criticism with a blend of tactics that includes co-opting select local figures, colluding with national officials to sidestep environmental and sociocultural safeguards, and coercing inhabitants into relocating under the threat of force from accommodating Ecuadorian authorities. By turning Ecuadorian national elites against locals and using divide-and-conquer tactics among Indigenous communities, the Chinese-led mining projects have entrenched existing political cleavages, have undermined community cohesion, and ultimately have harmed Ecuador’s democratic fabric, especially the standing of civil society and Indigenous rights organizations. While Ecuador has welcomed Chinese capital and other sources of international investment, this infusion of financing has increased the risk of political abuses at the national and local levels. This paper explains the adaptive strategies employed by the Chinese consortium and its subsidiaries in charge of the Mirador and San Carlos Panantza mining sites, contrasting the differing results these tactics have produced in each case. Both projects are located in Ecuador’s so-called Copper Belt provinces of Morona Santiago and Zamora Chinchipe, which are part of a mountain range known as the Cordillera del Cóndor. They are embedded in an ecologically and culturally sensitive zone that includes territory of the Indigenous Shuar community in the Ecuadorian Amazon. In the case of Mirador, the Chinese mining consortium’s adaptive response helped its subsidiary overcome local resistance but only by crushing it. In the case of San Carlos Panantza, local resistance so far has not been overcome, so the Chinese consortium has remained unable to proceed with its project. Neither case, even the Mirador site where mining has moved forward, is a sign of success for future relationships between Chinese mining conglomerates and Ecuadorian communities. To understand why the Chinese consortium’s adaptive tactics were somewhat more successful in Mirador, it is important to focus on the differing composition of the inhabitants of the land where the two mines are located. Mirador sits on territory shared by Shuar and non-Shuar settler communities who have different bonds with the land. The non-Shuar settlers emphasize the productive and commercial value of the land over the spiritual and symbolic value that is key for many in the Shuar community. The Canadian-held and later Chinese-controlled companies active in Ecuador’s mining industry understood this difference between Mirador’s inhabitants and adapted accordingly: they managed to displace resistant residents despite widespread opposition through questionable and sometimes arguably illegal purchases of land. In San Carlos Panantza, a second subsidiary of the Chinese consortium chose to respond to local criticism with the same alleged practices of violence, occupation, and displacement used in Mirador. However, although the two projects are geographically near each other, the situation played out differently at the second would-be mine: ongoing opposition has prevented mining operations from beginning at all yet. Again, paying attention to the inhabitants of the land is instructive. San Carlos Panantza is in the heart of Shuar territory in Arutam, a region with few non-Indigenous settlers. The mining incursion by the Chinese-run subsidiary and the Ecuadorian security forces tasked with supporting it were seen as a threat to the area’s Shuar people, who have been strongly protesting and opposing the mining venture since late 2016. This state of affairs is likely to have far-reaching effects for Ecuador too. The apparent collusion between Ecuador’s national government and the Chinese consortium (and its subsidiaries) has crushed those who oppose mining, has upended the country’s policies on resource extraction, and has yielded documented violations of local communities’ human rights. These events have transpired because both the Chinese firms and the Ecuadorian state have tended to see local communities as an obstacle to the development of the country’s extractive industries. As a result, local social and environmental safeguards have been weakened, tenuous consultation processes have eroded, environmental licenses have been granted under dubious circumstances, and local communities have been forcibly displaced. This paper explores the implications of the adaptive tactics chosen by the Chinese mining subsidiaries that run the Mirador and San Carlos Panantza mines. It also addresses how Chinese companies have, in some cases, negotiated with local communities to begin mining exploitation, while also analyzing the ways the Chinese mining consortium has interacted with the Ecuadorian government and other players, such as the Canadian mining company it acquired and other peer companies that set up successful coalitions for mining development in Ecuador. Finally, the paper explores the effects the agreements between the Ecuadorian government and the Chinese consortium have had on local actors.
Topic:: Development, Government, Mining, Indigenous, and Resistance
Political Geography:: China, Asia, South America, and Ecuador

208. India’s Fog of Misunderstanding Surrounding Nepal–China Relations

Author:: Vijay Gokhale
Publication Date:: 10-2021
Content Type:: Working Paper
Institution:: Carnegie Endowment for International Peace
Abstract:: India’s postindependence ties with Nepal were predicated on the intimate cultural and historical links between the two countries. As India’s first prime minister, Jawaharlal Nehru, noted, “though Nepal was an independent country, it was very closely allied to India in culture and tradition and we did not look upon it as a foreign country.” New Delhi also regarded China as an “interloper” in Nepal in 1950 who threatened India’s security and interests in the region, ignoring at least a century of Sino-Nepali history centering around Tibet. This paper argues that New Delhi’s close relationship with Nepal, bound in history and culture, and the misperception about China’s relations with Nepal before 1950 have contributed to a skewed understanding of Sino-Nepali relations. The Working Paper looks at the impact that New Delhi’s misperceptions of Sino-Nepali relations, termed the “fog of misunderstanding,” has had in the context of the triangular relations between China, India, and Nepal. The paper is divided into four sections arranged chronologically. The first section looks at the historical Sino-Nepali relationship from the mid-eighteenth to the mid-twentieth centuries. It establishes that this early relationship was centered on Tibet. While the Gorkha kings of Nepal sought to preserve their trade privileges in the region, the Chinese were concerned about the security of their southwestern frontier. Notably though, Beijing’s concern with security does not appear to have extended into any desire to conquer Nepal. This section also touches upon British India’s policy toward Nepal in the nineteenth century, and the subsequent approach that the government of independent India took in the first few years, without an adequate appreciation of Kathmandu’s history with China. As a consequence, India developed a suspicious attitude toward Beijing’s desire to re-establish ties with Kathmandu after the Chinese Civil War, and shaped its policy toward Nepal with this factor in mind. The second section delves into Indian and Chinese policies toward Nepal in the period from 1955 until the end of the monarchy in 2008. It showcases how, during this long period, the three kings of Nepal sought to leverage their ties with China in order to maintain some semblance of balance and how China, in turn, followed a limited but strategic approach that was centered on the kings. The fog of misunderstanding continued to shroud India’s attitude to Nepal-China relations during this period and, consequently, India’s Nepal policy lacked a working template to manage relations with a smaller neighbor sandwiched between India and China in a way that would preserve New Delhi’s influence in a positive way. In contrast to China’s political approach, New Delhi fluctuated between the monarchy and an assortment of democratic political parties, suggestive of a provincial approach in New Delhi’s dealing with Kathmandu. As a result, China’s approach ensured that its main objective in Nepal, namely the security of its southwestern frontier, was secured with a relatively low-risk and low-cost strategy. The third section deals with the aftermath of the fall of the Nepali monarchy, 2008 to 2016. During this important period, New Delhi had a fresh opportunity to reset ties by providing the support to democratic forces in Nepal, that could have resulted in a transformation of the Indo-Nepali ties. However, India appeared to hew to its traditional policy. China, on the other hand, quickly built new ties with the post-monarchical dispensation. India’s perceived actions as a result of the adoption of the new constitution of Nepal plunged Indo-Nepali ties to a nadir. It seems to have pushed Kathmandu to strengthen its relationship with China. This section of the paper also outlines the changing nature of China’s policy and objectives in Nepal, especially in the second decade of the twenty-first century, and its possible implications on the future course of the triangular relationship, as well as for India-Nepal relations. It postulates that under President Xi Jinping, China’s policy toward Nepal has shifted from protecting its periphery to a broader goal of bringing Nepal under its strategic control. This section highlights the political and economic levers that Beijing is using to build a preeminent position in Nepal. The paper concludes with an assessment of options available to all three countries going forward, and India’s options in Nepal in the face of China’s new policy in the region. It suggests that a decisive reset in policy toward Nepal is required to restore healthy relations that are based on mutual respect and mutual sensitivity. New Delhi may need to re-orient its thinking toward Nepal in the context of triangular relations, including on the boundary issue and the 1950 Treaty of Peace and Friendship that have been long-standing irritants in the India-Nepal relationship. Nepal, for its part, should also reflect carefully on whether its leveraging of China might become counterproductive in the light of changing strategic balance in its vicinity, and the implications of giving up the policy of balance for one that tilts decisively toward Beijing. The paper concludes that there is sufficient scope and opportunity for course correction by India, and that through sustained efforts India may be able to preserve its influence and security in Nepal and counter China’s expanding footprint.
Topic:: Security, Foreign Policy, Bilateral Relations, and Geopolitics
Political Geography:: China, South Asia, India, Asia, and Nepal

209. China’s Influence in South Asia: Vulnerabilities and Resilience in Four Countries

Author:: Deep Pal
Publication Date:: 10-2021
Content Type:: Working Paper
Institution:: Carnegie Endowment for International Peace
Abstract:: China’s economic and political footprint has expanded so quickly that many countries, even those with relatively strong state and civil society institutions, have struggled to grapple with the implications. There has been growing attention to this issue in the United States and the advanced industrial democracies of Japan and Western Europe. But “vulnerable” countries—those where the gap is greatest between the scope and intensity of Chinese activism, on the one hand, and, on the other, local capacity to manage and mitigate political and economic risks—face special challenges. In these countries, the tools and tactics of China’s activism and influence activities remain poorly understood among local experts and elites. Both within and beyond these countries, meanwhile, policy too often transposes Western solutions and is not well adapted to local realities. This is especially notable in two strategic regions: Southeastern, Central, and Eastern Europe; and South Asia. China’s economic and political profile has expanded unusually quickly in these two regions, but many countries lack a deep bench of local experts who can match analysis of the domestic implications of Chinese activism to policy recommendations that reflect domestic political and economic ground truth. To address this gap, the Carnegie Endowment initiated a global project to better understand Chinese activities in eight “pivot” countries in these two strategic regions. The project’s first objective was to enhance local awareness of the scope and nature of Chinese activism in states with (1) weak state institutions, (2) fragile civil societies, or (3) countries where “elite capture” is a feature of the political landscape. Second, the project aimed to strengthen capacity by facilitating a sharing of experiences and best practices across national boundaries. Third, the project sought to develop policy prescriptions for the governments of these countries, as well as the United States and its strategic partners, to mitigate and respond to activities inimical to political independence or well-balanced economic growth and development. To establish a comprehensive picture of China’s activities and their impact, this project dug deeply into Chinese activism in four case countries in each region—eight countries in total. We began by holding workshops, so that influencers across countries could share experiences and compare notes. Invited participants included policymakers, experts, journalists, and others—all with deep local knowledge, steeped in their countries’ politics, economies, and civil societies. In Europe, the four countries were Georgia, Greece, Hungary, and Romania, and in South Asia, Bangladesh, Maldives, Nepal, and Sri Lanka. Cross-national discussions among these regional participants aimed to raise awareness, discuss the implications of China’s growing activism in their countries, and compare notes on the diverse ways in which these various countries had managed the rapid influx of Chinese capital, programs, people, technology, and other sources of influence.
Topic:: International Relations, Foreign Policy, Development, Economy, Engagement, Regionalism, and Resilience
Political Geography:: Bangladesh, China, South Asia, Sri Lanka, Nepal, and Maldives

210. China’s Influence in Southeastern, Central, and Eastern Europe: Vulnerabilities and Resilience in Four Countries

Author:: Erik Brattberg, Philippe Le Corre, Paul Stronski, and Thomas de Waal
Publication Date:: 10-2021
Content Type:: Working Paper
Institution:: Carnegie Endowment for International Peace
Abstract:: China’s presence has brought socioeconomic opportunities to Georgia, Greece, Hungary, and Romania. Yet it has exacerbated governance shortfalls, undermined elements of political and economic stability, and complicated the European Union’s ability to reach consensus on key issues.
Topic:: Foreign Policy, Governance, European Union, Political stability, Resilience, and Economic Stability
Political Geography:: China, Europe, Greece, Romania, Hungary, Georgia, and United States of America

211. How Central Asians Pushed Chinese Firms to Localize

Author:: Dirk Van Der Kley and Niva Yau
Publication Date:: 10-2021
Content Type:: Working Paper
Institution:: Carnegie Endowment for International Peace
Abstract:: There has been a sea change in China’s economic involvement in Central Asia. Large-scale transport and electricity projects funded by Chinese government loans have dried up. Hydrocarbon exports to China continue, but they are not the focus of most new projects. Instead, there are a growing number of industrial projects that seek to make value-added products that can be exported. These projects are increasingly staffed by Central Asians who receive technical training from Chinese firms. This change has been primarily driven by Central Asian states. The region’s governments have long pushed for industrial capacity building, including the upskilling of local workers. In addition, debt concerns in Kyrgyzstan in particular have made Chinese loans less attractive and less prevalent. This trend has coincided with Chinese policy banks’ embrace of more conservative lending policies globally for infrastructure projects. Chinese firms have begun adapting to these demands. They have steadily increased their proportions of local hires by training Central Asian workers both onsite and in China to address skills shortages. They have tried to engage local communities to earn a social license for their overseas operations. The Chinese government is now following suit. It is developing more formal cooperation agreements on industrialization and upskilling in addition to pre-existing, ad-hoc arrangements by individual companies. So far, the outcomes have been mixed. Many Chinese firms in Central Asia are employing more locals. Yet the more closely integrated these Chinese firms become with the region’s economies, the more they must deal with, or be co-opted by, localized corruption and political fights. Newly available polling data shows that public sentiments toward China are becoming more negative. Chinese companies are flexibly adapting to this environment of heightened expectations in a variety of ways. The views that outside observers in Washington and elsewhere harbor of China’s infrastructure investments through the Belt and Road Initiative (BRI) in Central Asia are outdated and do not reflect how much Chinese firms and eventually the Chinese government have adapted to meet local needs. Any Western-proposed alternative to the BRI needs to take these considerations into account.
Topic:: Economics, Business, Industry, and Job Creation
Political Geography:: China, Central Asia, and Asia

212. How China Learned to Harness Israel’s Media and Booming Tech Scene

Author:: Roie Yellinek
Publication Date:: 10-2021
Content Type:: Working Paper
Institution:: Carnegie Endowment for International Peace
Abstract:: Israel and China established full diplomatic relations only in 1992, making Israel almost the last Middle Eastern country to do so. Starting in the early 2000s, ties between the two countries began to blossom, mostly because the Chinese government started to view Israel as a global technology hub and began seeking to capitalize on Israel’s innovation capabilities to help meet its own developmental needs and strategic challenges. In addition, as China’s rivalry with Israel’s leading ally, the United States, has heated up, Beijing’s interest in Israel also has gotten stronger. In light of Israel’s status as a major technology hub and a leading U.S. ally, China has sought to deepen its influence in Israel through media engagement and other forms of outreach. As Chinese actors have pursued technological innovation and greater political influence in Israel, they have employed three basic approaches to court favor in and through Israeli media circles: direct messaging to the Israeli public in local Hebrew-language newspapers, the use of Chinese outlets (especially the Hebrew department of China Radio International) targeted at Israeli audiences, and efforts to leverage prominent public figures friendly toward China to amplify favorable messages delivered on these local Israeli and Chinese platforms. China’s messaging strategy in Israel has evolved in three stages. Early on, this strategy mainly included recycled talking points from the Chinese Communist Party that do not always translate well overseas. Between 2015 and 2018, this messaging from Chinese actors started to become more direct and tailored for the Israeli people. Since 2018, Chinese engagement has expanded to include a much wider variety of Israeli media outlets, which has meant even more direct access to ordinary Israelis. This strategy and other elements of China’s diplomatic outreach to Israel seem to be having an impact. According to 2019 polling from the Pew Research Center, Israeli respondents view China more positively than those in any other Western-oriented countries that took part in this survey did. These results are an outgrowth of China’s desire to build influence vis-à-vis Israeli society, especially in terms of Israelis’ views on China. Chinese government officials and other actors see this campaign toward the Israeli people as part of a broader and more important strategic campaign, as Beijing competes with Washington for worldwide influence. Israel has a clear national interest in carefully examining how and why Beijing deploys such strategic messaging and how Chinese actors have leveraged local conditions, language habits, and consumer preferences to advance their objectives. The new Israeli government under Prime Minister Naftali Bennett must act prudently and keep these Chinese messaging activities in mind as it balances and advances Israel’s foreign policy interests, seeking to underscore that it does not see China as an enemy but that cooperation with Beijing needs to be pursued in the right way.
Topic:: Diplomacy, Science and Technology, Bilateral Relations, and Media
Political Geography:: China, Middle East, Israel, and Asia

213. How Argentina Pushed Chinese Investors to Help Revitalize Its Energy Grid

Author:: Juliana González Jáuregui
Publication Date:: 12-2021
Content Type:: Working Paper
Institution:: Carnegie Endowment for International Peace
Abstract:: China’s modernization strategy integrates both domestic and foreign policy, especially through two complementary prongs—the so-called Going Global strategy and the Belt and Road Initiative (BRI). This push to internationalize China’s development strategy has ushered in a new era in Beijing’s relationships with countries and regions around the world. In Latin America, these policies have triggered a dynamic pattern of interactions between China and the region’s political economy. Being rich in fuels, energy, foodstuffs, and basic products, countries in Latin America have emerged as significant suppliers for China, but they also have become important destinations for Chinese-made industrial products, and, subsequently, Chinese investment and lending. For Latin American countries, China’s rise as an influential investor, lender, trader, and builder has created an array of new challenges and opportunities. While Beijing has harnessed its engagement in Latin America to support its own development, countries in the region have sought to direct some of China’s economic and financial resources to promote their own strategic sectors. Argentina illustrates this dynamic well, particularly in the energy sector. Argentinian government officials and business leaders have attracted Chinese investment and finance into renewables and other types of energy to promote Buenos Aires’s goals of taking a hybrid path to an energy transition. For its part, China has seized this opportunity to advance its own development goals and to participate in Argentina’s energy transition strategy. Though Argentina has not yet formally joined the BRI, Argentinian officials have reported publicly that Buenos Aires has already decided to endorse the initiative and is waiting for the right moment to do so.1 Argentina has been weighing the pros and cons of signing on to the BRI. On the one hand, signing on could enhance the presence of Chinese actors in the Argentinian renewables sector, as China seeks to intertwine its engagement in Latin America with the deployment of the Green BRI, the dimensions of the initiative that are framed in terms of environmental sustainability. More broadly, joining the BRI could attract new Chinese investment and finance in alternative energy and electricity transmission infrastructure, further contributing to Argentina’s goals for an energy transition. On the other hand, Argentina faces the challenge of designing and implementing a long-term national energy plan that complements its role in the BRI. This means devising an energy plan that, among broader objectives, seeks to help Argentina harness Chinese know-how on renewables and develop innovation and technological capacities of its own. In the meantime, Argentina’s lack of committed engagement with the BRI to date has not impeded the expansion of Chinese overseas investment and financing for renewables and other types of energy projects in the country. In a clear sign of political agency, the diplomatic outreach of key Argentinian national and provincial government officials, as well as corporate players’ push for local associations, has been central in the quest to increase Chinese engagement in Argentina’s solar and wind power sectors and in other alternative energy projects. These interactions have allowed Argentinian policymakers to help shape an adaptive partnership to strengthen the alignment between Chinese investments and Argentinian development objectives. Admittedly, this engagement has at times encountered resistance due to environmental and social risks in certain localities. Even so, these concerns are part of the learning process and set a tone for future cooperation on energy projects. Renewables and alternative energy will continue to be a magnet for global investment as countries around the world strive to address climate change. Thus, local tensions are pushing both Argentinian and Chinese actors to learn from the problematic impacts of some projects and do more to address local communities’ concerns jointly. Successful responses to such concerns would further enhance the basis of Argentina and China’s energy-focused adaptative partnership.
Topic:: Infrastructure, Economy, Business, Investment, and Energy
Political Geography:: China, Asia, Argentina, and South America

214. Supply Chain Regulation in the Service of Geopolitics: What’s Happening in Semiconductors?

Author:: Dieter Ernst
Publication Date:: 08-2021
Content Type:: Working Paper
Institution:: Centre for International Governance Innovation
Abstract:: Supply chain regulation can be a formidable tool to protect a country’s resilience against unexpected disruptions of trade, investment and the supply of skilled labour. Its utility, however, may erode when geopolitics rather than economics becomes the primary objective. This paper examines the implementation problems and the unintended consequences of a new supply chain doctrine in the service of geopolitics, with a focus on US President Joe Biden’s Executive Order on America’s Supply Chains to protect US technological leadership and national security against China. With semiconductors as a primary target, America’s supply chain controls are designed to exploit China’s most glaring weaknesses as supply chain chokepoints that the US Commerce Department can block, thus impeding timely and cost-effective access to essential products, services and technologies. The paper also highlights a second defining characteristic of America’s supply chain doctrine — regulatory supply chain controls are combined with a big push in domestic semiconductor manufacturing. Three propositions are presented as guideposts for further research. The paper concludes with a brief discussion of the implications for future US supply chain control against China: Will the quest for improved supply chain resilience succeed in mobilizing enough forces to shift the focus of US policy away from supply chain regulation in the service of geopolitics?
Topic:: International Cooperation, Labor Issues, Regulation, Rivalry, and Supply Chains
Political Geography:: China, Asia, North America, and United States of America

215. Australia as a Rising Middle Power

Author:: Malcolm Davis
Publication Date:: 04-2020
Content Type:: Working Paper
Institution:: Centre for Non-Traditional Security Studies, S. Rajaratnam School of International Studies
Abstract:: This paper examines the key drivers shaping Australia’s role as a middle power in an era of intensifying US-China strategic competition. These drivers include the influence of strategic geography; its historical legacy in international affairs; the impact of its economic relationships with states in the Indo-Pacific region; the changing demands of defence policy, including the potential offered by rapid technological change; and, the impact of climate change, resource constraints and demographic factors. The paper considers three possible scenarios that will shape Australia’s middle power policy choices – a US-China strategic equilibrium; a “China crash” scenario that promotes a more nationalist and assertive Chinese foreign policy; and a third “major power conflict” scenario where competition extends into military conflict. The paper concludes that Australia cannot maintain a delicate balance between its strategic alliance with the US and trading relationship with China. It argues there is a need for Australia to adopt a deeper strategic alliance with the US while promoting closer ties with its partners in the Indo-Pacific and supporting the growth of a Free and Open Indo-Pacific region to counterbalance growing Chinese power. Australia needs to embrace an Indo-Pacific step up, and as a middle power, reduce the prospect of a Sino-centric regional order emerging.
Topic:: Defense Policy, Nationalism, Military Strategy, and Conflict
Political Geography:: United States, China, Asia, Australia, and Indo-Pacific

216. The New “Rare Metal Age”: New Challenges and Implications of Critical Raw Materials Supply Security in the 21st Century

Author:: Frank Umbach
Publication Date:: 04-2020
Content Type:: Working Paper
Institution:: Centre for Non-Traditional Security Studies, S. Rajaratnam School of International Studies
Abstract:: When Beijing threatened to restrict China’s export of rare earths (widely used in numerous important civilian and military technologies) to the United States at the end of May 2019, the world was reminded of China’s rare earths export disruption in the autumn of 2010 amid a maritime territorial conflict between China and Japan. In the past few years, the worldwide attention cast on the future supply security of rare earths and other critical raw materials has increased in the United States, the European Union, Japan and other countries owing to the global expansion of “green technologies” (including renewable energy sources, electric vehicles and batteries, and smart grids) and digitalisation as well as equipment and devices embedded with artificial intelligence. In this paper, the term “critical raw materials” (CRMs) refers to raw materials critical to industries that are also import-dependent on them, and to new technologies which often have no viable substitutes and whose supply, besides being constrained by limited recycling rates and options, is also dominated by one or a few suppliers. CRMs include rare earth elements (REEs), which comprise 17 different elements (see Figure 4). The global race for the most advanced technologies dependent on CRMs has intensified the competition for access to as well as strategic control of REEs, lithium, cobalt, copper, nickel and other CRMs. This working paper analyses the global supply and demand balance of three CRMs (REEs, lithium and cobalt, the latter two being major raw materials for batteries) in the foreseeable future and whether ASEAN countries can play a role as producers and suppliers of CRMs. It also examines potential counterstrategies for mitigating and reducing the global demand for CRMs, such as substitution, reduced use of CRMs, and recycling and re-use.
Topic:: Natural Resources, Digital Economy, Green Technology, and Metals
Political Geography:: United States, Japan, China, and Asia

217. India’s Strategic Intent and Military Partnerships in the Indian Ocean Region

Author:: Gaurav Sharma and Marc Finaud
Publication Date:: 05-2020
Content Type:: Working Paper
Institution:: The Geneva Centre for Security Policy
Abstract:: Due to the importance India attaches to potential threats to its maritime security, its diplomacy has increasingly focused on the Indian Ocean region (IOR) and it has increased cooperation with Indian Ocean states. In the last five years, India has also established security partnerships with major IOR strategic stakeholders such as France and the United States. India has increasingly invested in providing military training, weapons support and disaster relief assistance to “like-minded” states in the IOR. Due to the potential risks of escalation to nuclear-weapons use should conflict occur with other countries in the region such as China and Pakistan, it would be in India’s interests to promote more confidence and
Topic:: Security, Diplomacy, Nuclear Weapons, Military Affairs, and Missile Defense
Political Geography:: Pakistan, China, South Asia, India, and Indian Ocean

218. Toward Accountable Nuclear Deterrents: How Much is Too Much?

Author:: George Perkovich
Publication Date:: 02-2020
Content Type:: Working Paper
Institution:: Carnegie Endowment for International Peace
Abstract:: For decades, policy debates in nuclear-armed states and alliances have centered on the question, “How much is enough?” What size and type of arsenal, and what doctrine, are enough to credibly deter given adversaries? This paper argues that the more urgent question today is, “How much is too much?” What size and type of arsenal, and what doctrine, are too likely to produce humanitarian and environmental catastrophe that would be strategically and legally indefensible? Two international initiatives could help answer this question. One would involve nuclear-armed states, perhaps with others, commissioning suitable scientific experts to conduct new studies on the probable climatic and environmental consequences of nuclear war. Such studies would benefit from recent advances in modeling, data, and computing power. They should explore what changes in numbers, yields, and targets of nuclear weapons would significantly reduce the probability of nuclear winter. If some nuclear arsenals and operational plans are especially likely to threaten the global environment and food supply, nuclear-armed states as well as non-nuclear-weapon states would benefit from actions to physically reduce such risks. The paper suggests possible modalities for international debate on these issues. The second initiative would query all nuclear-armed states whether they plan to adhere to international humanitarian law in deciding if and when to detonate nuclear weapons, and if so, how their arsenals and operational plans affirm their intentions (or not). The United Kingdom and the United States have committed, in the words of the 2018 U.S. Nuclear Posture Review, to “adhere to the law of armed conflict” in any “initiation and conduct of nuclear operations.” But other nuclear-armed states have been more reticent, and the practical meaning of such declarations needs to be clarified through international discussion. The two proposed initiatives would help states and civil society experts to better reconcile the (perceived) need for nuclear deterrence with the strategic, legal, and physical imperatives of reducing the probability that a war escalates to catastrophic proportions. The concern is not only for the well-being of belligerent populations, but also for those in nations not involved in the posited conflict. Traditional security studies and the policies of some nuclear-armed states have ignored these imperatives. Accountable deterrents—in terms of international law and human survival—would be those that met the security and moral needs of all nations, not just one or two. These purposes may be too modest for states and activists that prefer the immediate prohibition and abolition of nuclear weapons. Conversely, advocates of escalation dominance in the United States and Russia—and perhaps in Pakistan and India—will find the force reductions and doctrinal changes implied by them too demanding. Yet, the positions of both of these polarized groups are unrealistic and/or unacceptable to a plurality of attentive states and experts. To blunt efforts to stifle further analysis and debate of these issues, the appendix of this paper heuristically rebuts leading arguments against accountable deterrents. Middle powers and civil society have successfully put new issues on the global agenda and created political pressure on major powers to change policies. Yet, cooperation from at least one major nuclear power is necessary to achieve the changes in nuclear deterrent postures and policies explored here. In today’s circumstances, China may be the pivotal player. The conclusion suggests ways in which China could extend the traditional restraint in its nuclear force posture and doctrine into a new approach to nuclear arms control and disarmament with the United States and Russia that could win the support of middle powers and international civil society. If the looming breakdown in the global nuclear order is to be averted, and the dangers of nuclear war to be lessened, new ideas and political coalitions need to gain ascendance. The initiatives proposed here intended to stimulate the sort of analysis and debate from which such ideas and coalitions can emerge.
Topic:: Arms Control and Proliferation, Environment, Nuclear Power, Weapons, and Deterrence
Political Geography:: Pakistan, Russia, China, India, Global Focus, and United States of America

219. China’s responsibility for the Covid-19 pandemic: An international law perspective

Author:: Katja Creutz
Publication Date:: 06-2020
Content Type:: Working Paper
Institution:: Finnish Institute of International Affairs
Abstract:: The coronavirus pandemic has roiled international relations. The huge global toll of the pandemic, both in terms of deaths and economic implications, has raised the question of Chinese responsibility. This Working Paper analyzes China’s responsibility for Covid-19 under international law. In order for state responsibility to arise, China must have committed an internationally wrongful act. The conduct must be attributable to China and must constitute a breach of its international obligations. An analysis of the timeframe concerning the main measures undertaken by Chinese authorities at different government levels shows a lag in reporting the outbreak to WHO according to the International Health Regulations. Hence, there appears to be a case for injured states to invoke China’s responsibility. The prospects for implementation are nevertheless bleak. A tacit understanding seems to prevail among states not to pursue the spread of pathogens in terms of legal responsibility or litigation. Whether major power rivalry or the enormous costs of the pandemic will change this non-confrontational tradition of dealing with pathogens remains to be seen.
Topic:: Leadership, Public Health, Pandemic, and COVID-19
Political Geography:: China and Asia

220. Great-power competition and the rising US-China rivalry: Towards a new normal?

Author:: Bart Gaens and Ville Sinkkonen
Publication Date:: 09-2020
Content Type:: Working Paper
Institution:: Finnish Institute of International Affairs
Abstract:: The United States and China are posited to be at the epicenter of an emerging and – by most accounts – intensifying rivalry. This report delves into the theoretical underpinnings as well as the geostrategic and geo-economic dynamics driving this great-power competition. It explores future prospects for contestation and engagement in key issue areas, such as arms control, trade and sanctions. The chapters in this volume also examine the Indo-Pacific as the immediate regional frontline of the unfolding great-power contest and explore the role that Europe has to play in this game. As the world is crossing the threshold into a new age of great-power competition, the debate on the US-China rivalry reveals the complex and contested nature of the meanings, causes, policy implications and future prospects of what is set to become the “new normal” in global politics.
Topic:: Hegemony, Geopolitics, Conflict, and Rivalry
Political Geography:: United States, China, Asia, and North America

221. Iran’s foreign policy: Buying time until the US presidential elections

Author:: Mariette Hagglund
Publication Date:: 10-2020
Content Type:: Working Paper
Institution:: Finnish Institute of International Affairs
Abstract:: A key issue dominating Iran’s foreign policy agenda is the future of the Iran nuclear deal with regard to the next US president. Non-state armed groups mark the core of Iran’s leverage in the region, but Iran is currently looking into diversifying its means of influence. Although Iran considers its non-aligned position a strength, it is also a weakness. In an otherwise interconnected world, where other regional powers enjoy partnerships with other states and can rely on external security guarantors, Iran remains alone. By being more integrated into regional cooperation and acknowledged as a regional player, Iran could better pursue its interests, but US attempts to isolate the country complicate any such efforts. In the greater superpower competition between the US and China, Iran is unlikely to choose a side despite its current “look East” policy, but may take opportunistic decisions.
Topic:: Security, Foreign Policy, Military Strategy, and Elections
Political Geography:: United States, China, Iran, Middle East, Asia, and North America

222. Is China preparing to invade Taiwan? The time may be opportune, but the overall situation is not

Author:: Jyrki Kallio
Publication Date:: 10-2020
Content Type:: Working Paper
Institution:: Finnish Institute of International Affairs
Abstract:: Speculation is rife that China could take advantage of the potential confusion during the US presidential election and invade Taiwan. Although China has never relinquished the military option for resolving the Taiwan issue, there are sound reasons to downplay the risk of a military confrontation at the present time.
Topic:: War, Military Strategy, Elections, and Conflict
Political Geography:: United States, China, Taiwan, Asia, and North America

223. Digital authoritarianism in China and Russia: Common goals and diverging standpoints in the era of great-power rivalry

Author:: Elina Sinkkonen and Jussi Lassila
Publication Date:: 10-2020
Content Type:: Working Paper
Institution:: Finnish Institute of International Affairs
Abstract:: China and Russia are jointly advancing their shared interests in the international arena and are building up cooperation in the tech sector. Despite far-reaching plans, the asymmetry of cooperation in favour of China is increasingly at odds with Russia’s national goals in digital technology. Differences in resources and standpoints are also reflected in the implementation of digital surveillance. China’s surveillance system is sophisticated and extensive whereas Russia’s is largely inconsistent and emerging, as evidenced by the fact that there was virtually no control of the internet in Russia until 2012. While advanced surveillance in authoritarian countries is worrying, technology in strategic sectors is also a key field of increasingly disconcerting great-power competition. As a result of strategic competition, the world is faced with the risk of technological decoupling, which would contribute to further fragmentation of the international community and deepening of existing rivalries.
Topic:: Science and Technology, Authoritarianism, Digital Economy, and Surveillance
Political Geography:: Russia, China, Europe, and Asia

224. Uzbekistan’s new Central Asia policy: The economic rationale and political implications of good neighbourliness

Author:: Kristiina Silvan
Publication Date:: 11-2020
Content Type:: Working Paper
Institution:: Finnish Institute of International Affairs
Abstract:: Under the leadership of President Shavkat Mirziyoyev, Uzbekistan has embarked on a moderate reform programme that aims to achieve socio-economic growth without undoing the country’s authoritarian political system. The programme has implications beyond Uzbekistan’s borders because it has changed the way Uzbekistani foreign policy is formulated and implemented. Uzbekistan’s former isolationist stance has shifted to a foreign policy opening, which is most noticeable in the improvement of its relations with its neighbours. This Working Paper analyzes “good neighbourliness”, the key concept of Uzbekistan’s new Central Asia policy. It details the amendment of Uzbekistan’s bilateral relations with its neighbours and points to the positive reception of Uzbekistan’s new regional policy in Russia, China, and the West. The paper argues that while “good neighbourliness” is a pragmatic strategy rooted in economic rationality, the policy’s regional implications are substantial. It is laying the necessary foundation for sustainable Central Asian co-operation from within in a way that is acceptable to the Central Asian states and big non-regional actors alike.
Topic:: Regional Cooperation, Bilateral Relations, Authoritarianism, Reform, and Leadership
Political Geography:: Russia, China, Europe, Central Asia, Asia, and Uzbekistan

225. Estimating the Arms Sales of Chinese Companies

Author:: Nan Tian and Fei Su
Publication Date:: 01-2020
Content Type:: Working Paper
Institution:: Stockholm International Peace Research Institute
Abstract:: Quantitative research on the finances of the Chinese arms industry has been limited by the scarcity of available data. A scoping study to estimate the financial value of the arms sales of companies in the Chinese arms industry—using a new methodology—found information on four companies: the Aviation Industry Corporation of China (AVIC), the China Electronics Technology Group Corporation (CETC), the China South Industries Group Corporation (CSGC) and the China North Industries Group Corporation (NORINCO). These four companies cover three main sectors of conventional arms production: aircraft, electronics and land systems. The estimates suggest that China is the second-largest arms producer in the world, behind the United States and ahead of Russia. All four of the profiled companies would be ranked among the 20 largest arms-producing and military services companies globally in 2017, with three—AVIC, NORINCO and CETC—in the top 10. The new methodology improves the understanding of the structure, size and evolution of the global arms industry.
Topic:: International Trade and Finance, Weapons, Arms Trade, and Military Spending
Political Geography:: China and Asia

226. EU Security Perspectives in an Era of Connectivity: Implications for Relations with China

Author:: Ian Anthony, Jiayi Zhou, and Fei Su
Publication Date:: 02-2020
Content Type:: Working Paper
Institution:: Stockholm International Peace Research Institute
Abstract:: This SIPRI Insights Paper assesses EU security perspectives on connectivity, alongside and in relation to its evolving relationship with China. The EU’s relations with China have undergone an important shift in recent years, with a strengthened emphasis by the EU on the challenges to bilateral cooperation. In addition, since 2014, EU and EU member states’ security perspectives have undergone a wider reassessment, one that has increased the prominence of the military dimensions of connectivity, including military mobility, in EU security planning. The EU and China are currently pursuing synergies between their separate connectivity initiatives, namely the Belt and Road Initiative and the Connecting Europe programme. However, there remain barriers to sustainable cooperation that will need to be addressed between them moving forward. This Insights Paper outlines a number of those security concerns from the EU perspective, within the transport and digital sectors specifically.
Topic:: Security, International Cooperation, Bilateral Relations, European Union, and Belt and Road Initiative (BRI)
Political Geography:: China, Europe, and Asia

227. Combating China’s COVID-19 Propaganda Offensive to Undermine the United States on the Global Stage

Author:: John Lee
Publication Date:: 03-2020
Content Type:: Working Paper
Institution:: Hudson Institute
Abstract:: Throughout the United States, it is becoming increasingly clear that the Chinese Communist Party (CCP) is exploiting COVID-19 in an effort to reshape the global order and enhance China’s international leadership at the expense of the US. A range of prominent commentators further assert that the Trump administration bears much of the blame for this turn of events. This argument tends to rest on twin assumptions:1 China is winning the battle of narratives when it comes to comparative national competence and its decisiveness in responding to its COVID-19 outbreak. The Trump administration is damaging America’s standing by getting off to a bad start in its response to the pandemic, exposing the underlying weaknesses of American institutions and preparedness for such a crisis. These arguments correctly acknowledge that the global pandemic is occurring within a context of US-China strategic, political, and economic competition and/or rivalry. This is the point of warnings to the administration that there is more at stake than containing and managing the virus, even if that is the immediate priority.
Topic:: International Relations, Foreign Policy, Economics, Health, National Security, and COVID-19
Political Geography:: China and East Asia

228. Beyond Corona: Getting EU Economic Security Right

Author:: Tobias Gehrke
Publication Date:: 04-2020
Content Type:: Working Paper
Institution:: EGMONT - The Royal Institute for International Relations
Abstract:: The corona crisis, the US-China great power competition and lacklustre international rules vividly demonstrate the vulnerability of economic interdependence. Interdependence is a power struggle, not a mutual aid society. For the vast benefits of a globalised economy to continue to outweigh its risks, policies to build greater resilience are necessary. For the EU, the unprecedented events also offer an opportunity to forge a new economic security approach to better manage its dependencies in strategic sectors.
Topic:: Security, International Cooperation, Europe, Public Health, Pandemic, and COVID-19
Political Geography:: United States, China, Europe, Asia, and North America

229. Post-workshop Briefing Paper: Preventing a COVID-19 Crisis in Africa

Author:: Atif Choudhury, Yawei Liu, and Ian Pilcher
Publication Date:: 06-2020
Content Type:: Working Paper
Institution:: The Carter Center
Abstract:: In May 2020, the Carter Center’s China Program partnered with the China Institutes of Contemporary International Relations (CICIR) and the South African Institute of International Affairs (SAIIA) to organize a virtual workshop on Africa-U.S.-China cooperation on COVID-19 response. The workshop brought together a range of experts from the U.S, China, Ethiopia, Burundi, Kenya, and South Africa to discuss the public health impact and wider policy implications of the COVID-19 pandemic on the African continent. Emory University’s Global Health Institute and The Hunger Project also helped identify speakers and moderate panels.
Topic:: International Cooperation, Public Health, Pandemic, and COVID-19
Political Geography:: Kenya, Africa, United States, China, Asia, South Africa, North America, Ethiopia, and Burundi

230. Labour Market Impacts of Import Penetration from China and Regional Trade Agreement Partners: The Case of Japan

Author:: Kazunobu Hayakawa, Tadashi Ito, and Shujiro Urata
Publication Date:: 04-2020
Content Type:: Working Paper
Institution:: Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:: The impacts of imports on the domestic labour market have been hotly debated recently. The purpose of this paper is to empirically examine the effects of not only imports from China but also those under regional trade agreements (RTAs) on employment in Japan. As in previous studies in the literature, we found that the rise in import penetration from China significantly decreases employment in Japan. However, import penetration under RTA regimes is found to have insignificant effects on employment. The finding suggests that the increase in imports under RTA regimes might not be harmful to the domestic labour market. In addition, we did not find significant effects of import penetration via input–output linkages. This insignificant result may be because imports by Japanese manufacturing firms are mostly conducted in the form of intra-firm trade, enabling them to avoid negative impacts on employment.
Topic:: International Trade and Finance, Regional Cooperation, Labor Issues, Employment, and Manufacturing
Political Geography:: Japan, China, and Asia

231. The Value-Added Tax Reform and Labour Market Outcomes: Firm Level Evidence from China

Author:: Yuxiang Yang and Hongyong Zhang
Publication Date:: 08-2020
Content Type:: Working Paper
Institution:: Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:: The tax incentives designed to stimulate firm investment may have a large impact on labour market outcomes. Using a comprehensive data set containing more than 1 million Chinese manufacturing firms during the period 2000–2013 with a difference-in-difference approach, we examine the impact of the value-added tax reform in 2004–2008 on the firm-level labour market outcomes. We find that firms in eligible industries and regions (treated firms) enjoying lower costs of purchasing fixed assets under the reform tended to increase capital investment and reduce employment relative to firms that did not have tax incentives (the control firms). Compared with the control firms, the treated firms became more capital intensive and had an increase in average wage but a decline in labour income share. We also provide evidence that the substitutions of labour input by capital input is associated with increases in firm productivity and the share of skilled workers, but not imported capital goods.
Topic:: Labor Issues, Reform, Tax Systems, and Labor Market
Political Geography:: China and Asia

232. Exploring India's Strategic Futures

Author:: Arzan Tarapore
Publication Date:: 01-2020
Content Type:: Working Paper
Institution:: Walter H. Shorenstein Asia-Pacific Research Center
Abstract:: he method of major/minor trends developed in this report suggests that the roots of apparently surprising future behavior can be found in a close reading of a target state’s history. Using this method, the report outlines three unlikely but plausible alternative futures of India as a strategic actor. The first scenario envisions India as a Hindu-nationalist revisionist power hostile to Pakistan but accommodating of China; in the second, it is a militarily risk-acceptant state that provokes dangerous crises with China; and in the third scenario, India is a staunch competitor to China that achieves some success through partnerships with other U.S. rivals like Russia and Iran. These scenarios are designed not to predict the future but to sensitize U.S. policymakers to possible strategic disruptions. They also serve to highlight risks and tensions in current policy.
Topic:: International Relations, Foreign Policy, Conflict, and Strategic Interests
Political Geography:: Russia, United States, China, Europe, India, Asia, and North America

233. BRICS and Mortar: New Architecture in Education

Author:: Kishore Singh
Publication Date:: 12-2020
Content Type:: Working Paper
Institution:: India International Centre (IIC)
Abstract:: In the beginning of the new century and the millennium, Brazil, the Russian Federation, India and China came to be reckoned as the world’s fastest growing economies. Later, these were joined by South Africa, leading to the emergence of BRICS as a political coalition of five countries. The year 2009 was a landmark in this historic development. In that year, the first BRICS Summit was held in Yekaterinburg, Russian Federation. The BRICS summits held annually since then have become an important political platform for the collective voice of BRICS countries in the form of BRICS Declarations. Education is one of the most critical areas addressed in successive BRICS summits. Centrality of education in people’s lives and its catalytic role for human development is widely recognised in today’s world. So it was inevitable that the BRICS countries would come together and create a common plat-forum on education as well. The first meeting of BRICS Education Ministers was held in November 2013 on the margins of the UNESCO General Conference. Since then, the BRICS Education Ministers have been meeting annually and issuing a separate declaration in tandem with the declaration issued at the summits.
Topic:: Development, Education, International Cooperation, and BRICS
Political Geography:: Russia, China, South Asia, India, South Africa, and Brazil

234. COVID-19: In Search of Solutions for Maritime Supply Chains

Author:: Chin Yim Leng
Publication Date:: 06-2020
Content Type:: Working Paper
Institution:: Maritime Institute of Malaysia
Abstract:: The outbreak of the COVID-19 pandemic has had a remarkable impact on maritime supply chains. Since its first case in the capital of China’s Hubei province, Wuhan, Chinese seaborne trading activities were greatly affected – reports of weakening manufacturing confidence, decreasing demand for non-essential goods worldwide, and reduced workforce has surfaced since the massive transmission of COVID-19 in January 2020. Many European and Asian countries, including the United States, have responded to the pandemic in March 2020 by imposing strict containment measures. The implementation of national lockdowns or movement restrictions in pandemic-affected countries has led to rapid contractions in maritime supply chains. The wide-ranging impacts of COVID-19 on manufacturing and trading demands have created the need for different importing speeds based on essentiality, thus deteriorating the maritime supply chains. Governments and relevant authorities, as well as private entities, should take initiatives to ensure that maritime supply chains remain fully functional for national and commercial interests as the COVID-19 pandemic progresses. It could be ideal to adopt digitalisation and blockchains as these digital processes are easy to access and control in optimising the efficiency of maritime supply chains amidst the unprecedented COVID-19 pandemic.
Topic:: International Trade and Finance, Maritime, Pandemic, COVID-19, and Supply Chains
Political Geography:: China and Asia

235. Mapping the International Presence of the World’s Largest Arms Companies

Author:: Lucie béraud-Sudreau, Alexandra Marksteiner, Diego Lopes da Silva, Nan Tian, Alexandra Kuimova, Pieter D. Wezeman, and Siemon T. Wezeman
Publication Date:: 12-2020
Content Type:: Working Paper
Institution:: Stockholm International Peace Research Institute
Abstract:: Arms companies have a presence that reaches far beyond the countries in which they are headquartered. This is the result of the internationalization of the arms industry. This paper uses a new data set to examine the results of this internationalization in terms of the international presence of major arms companies. It presents a mapping comprising 400 foreign entities linked to the world’s largest arms companies. The mapping shows that the international presence of major arms companies continues to be influenced by geopolitical divisions and ties, and generally mirrors the geographical locations of the world’s biggest arms import markets. It also reveals that the international presence of major Chinese arms companies and the one Russian company included in the study remains limited.
Topic:: Arms Control and Proliferation and Military Spending
Political Geography:: Russia, China, and Global Focus

236. Domestic and International (Dis)Order: A Strategic Response

Author:: Aspen Strategy Group
Publication Date:: 10-2020
Content Type:: Working Paper
Institution:: Aspen Institute
Abstract:: The Aspen Strategy Group recently released Domestic and International (Dis)Order: A Strategic Response bringing together preeminent experts to explore race, democracy, and political divisions on the American home front; the future of U.S.-China relations; the global economy; and U.S. foreign policy priorities for 2021. Contributors include: Madeleine K. Albright, Ayaan Hirsi Ali, Zoë Baird, Robert D. Blackwill, Nicholas Burns, Kurt M. Campbell, Diana Farrell, Peter Feaver, Michael J. Green, Naima Green-Riley, Jane Harman, Kay Bailey Hutchison, Wolfgang Ischinger, Aditi Kumar, Anja Manuel, David McCormick, John McLaughlin, Shivshankar Menon, Joseph S. Nye, Jr., David H. Petraeus, Tom Pritzker, Condoleezza Rice, Senator Tim Scott, Anne-Marie Slaughter, Torrey Taussig, and Philip Zelikow.
Topic:: Security, Foreign Policy, Diplomacy, Economics, International Cooperation, Race, Military Strategy, Democracy, and Strategic Stability
Political Geography:: China, Asia, North America, and United States of America

237. Biowar next? Security implications of the coronavirus

Author:: Karsten Friis
Publication Date:: 06-2020
Content Type:: Working Paper
Institution:: LSE IDEAS
Abstract:: What are the possible short-, medium- and long-term implications of the coronavirus for global security and defence? In this Strategic Update, Karsten Friis investigates the pandemic's potential consequences for the world, its armed forces, the integration of Europe, US-China relations, as well as the concept and practice of 'war' more broadly. Although much remains uncertain, the disruptions which are beginning to emerge demand a reckoning with a changed world -- and world order.
Topic:: Security, Defense Policy, War, and COVID-19
Political Geography:: China, Europe, and United States of America

238. From Russia With Love? Serbia's Lukewarm Reception of Russian Aid and Its Geopolitical Implications

Author:: Vuk Vuksanovic
Publication Date:: 06-2020
Content Type:: Working Paper
Institution:: LSE IDEAS
Abstract:: As the coronavirus (COVID-19) pandemic reached the Balkans, Serbia has energetically taken its partnership with China to the next level. This happened as Belgrade embraced China’s “mask diplomacy” campaign of supplying medical equipment to the countries affected by the pandemic. However, while Russia has supplied aid to Serbia to combat the pandemic, it has not received the same attention from the Serbian leadership and public the way China did. Therefore, the pandemic has proven to be a potent ‘revealer’ and reminder of the lack of substance and depth of differences in the Serbo-Russian partnership.
Topic:: Diplomacy, Partnerships, Geopolitics, and COVID-19
Political Geography:: Russia, China, Serbia, and Balkans

239. China in One Country: interdependence or globalisation 'with Chinese characteristics'?

Author:: George Magnus
Publication Date:: 07-2020
Content Type:: Working Paper
Institution:: LSE IDEAS
Abstract:: Globalisation has faltered, and faces significant political challenges. In both the US and China, voices are calling for a reduction of economic interdependence between the two countries. In the US, this has taken the name of decoupling, in China, self-reliance. At the same time, China’s President, Xi Jinping has vocally championed globalisation in various global fora in recent years. Understanding of China’s systems of government and business, as well as its global interests, is lacking when compared to that of the US. In this Strategic Update, George Magnus investigates what is meant when China’s leadership speaks of globalisation, and what the implications of the answer are for the rest of the world.
Topic:: Foreign Policy, Economics, Globalization, and Leadership
Political Geography:: China, Asia, and United States of America

240. Economic Diplomacy in the 21st Century: Principles and Challenges

Author:: Linda Yueh
Publication Date:: 08-2020
Content Type:: Working Paper
Institution:: LSE IDEAS
Abstract:: Economic diplomacy in the 21st century will face a different set of challenges stemming from the changed global economy, US-China tensions, as well as a backlash against globalisation, among others. Therefore, the conduct of economic diplomacy, i.e., how a country manages its foreign economic relations including trade and investment, must adapt. The framework for economic diplomacy should seek to balance commercial openness with strategic foreign policy aims, broadly defined. It should situate a country within the 21st century global economy with its new drivers, promote a rules-based system in order to mitigate Great Power tensions, and recognise that all foreign economic policy is ultimately also domestic. There is no one general approach but there are several principles, each with their own challenges, for governments to consider, which is set out in this Strategic Update.
Topic:: Foreign Policy, Investment, Trade, and Economic Diplomacy
Political Geography:: China, Asia, North America, and United States of America

241. All Hands on Deck: the Crisis in the Eastern Mediterranean and the Need for US Leadership

Author:: Alexandros Zachariades
Publication Date:: 10-2020
Content Type:: Working Paper
Institution:: LSE IDEAS
Abstract:: Crisis has returned to the Eastern Mediterranean where Greek and Turkish economic interests, legal claims, and armed forces are squaring off. In this Strategic Update, Alexandros Zachariades explores how the two NATO powers arrived at the current confrontation, how the contest intersects with issues ranging from China to Libya, and how the international community can resolve the tension.
Topic:: International Relations, Foreign Policy, NATO, Economics, and Leadership
Political Geography:: China, Turkey, Greece, Libya, United States of America, and Mediterranean

242. Axis of Convenience? Israel and China in a multipolar world

Author:: Vuk Vuksanovic
Publication Date:: 02-2020
Content Type:: Working Paper
Institution:: LSE IDEAS
Abstract:: Despite being one of the most important allies of the United States in the Middle East, Israel has been building a new partnership with China since 2013. The repositioning is motivated by changes in the country’s strategic environment, its crisis in the relationship with the United States during the Obama years, and its economic and infrastructural needs. However, Israel is still deeply anchored in its alliance with the United States, which will impose limitations on how far its partnership with China can grow. For now, nevertheless, this relationship attests to the new geopolitical reality of the 21st century in which even the most ardent US allies, such as Israel, must hedge their bets and diversify their partnerships by engaging China.
Topic:: Partnerships, Alliance, Strategic Competition, and Multipolarity
Political Geography:: China, Middle East, Israel, Asia, and United States of America

243. China and COVID-19: a shock to its economy, a metaphor for its development

Author:: George Magnus
Publication Date:: 02-2020
Content Type:: Working Paper
Institution:: LSE IDEAS
Abstract:: The Chinese government’s draconian actions to control the coronavirus seem to be producing a remarkable economic contraction. As so many are unable to attend or resume work at the moment, the government’s palliative economic measures may gain little traction. Although the demand shock will eventually fade, other longer-term issues will surely endure. The supply shock will be less obvious but more corrosive. The government’s questionable conduct in managing the public health crisis has unveiled significant features about governance in Xi’s China that can be mapped on to China’s development. While this crisis is the biggest challenge Xi has faced, there is little doubt that he will survive it, champion the party’s role in the nation’s rescue, and feel emboldened to continue with his authoritarian governance. Yet it is this that, in the long run, will prove incompatible with China’s economic development ambitions.
Topic:: Development, Economy, COVID-19, and Health Crisis
Political Geography:: China and Asia

244. Battleground Southeast Asia: China's Rise and America's Options

Author:: Charles Dunst
Publication Date:: 03-2020
Content Type:: Working Paper
Institution:: LSE IDEAS
Abstract:: Southeast Asia, while still a reservoir of goodwill for the US, has in recent years come increasingly under China's umbrella. In this Strategic Update, Charles Dunst analyzes China's expansion there, discusses Southeast Asians' American predeliction, and offers steps the US can take to "win back" the region.
Topic:: Foreign Policy, Politics, International Affairs, and Strategic Competition
Political Geography:: China, Southeast Asia, and United States of America

245. Making Sense of Technological Spheres of Influence

Author:: Valentin Weber
Publication Date:: 04-2020
Content Type:: Working Paper
Institution:: LSE IDEAS
Abstract:: The deterioration of Sino-American relations and the rise of novel forms of statecraft have given way to a worrying new feature of the international system: technological spheres of influence. In this Strategic Update, Valentin Weber explains how we have arrived at this novel geopolitical arrangement, where in the world the greatest contestation lies, and what the future of technospheres may hold.
Topic:: Science and Technology, Bilateral Relations, and International System
Political Geography:: China and United States of America

246. China versus the US in the Pandemic Crisis: The State-People Nexus Confronting Systemic Challenges

Author:: Dic Lo and Yuning Shi
Publication Date:: 07-2020
Content Type:: Working Paper
Institution:: School of Oriental and African Studies - University of London
Abstract:: The control of the COVID-19 crisis requires strong and rapid actions of each nation- state, but multiple facets of the ineffectiveness have been exposed so far. This paper seeks to characterise and assess the handling of the public health emergency in China and the United States. The exposition focuses on the governance structures and state-people dynamics of the two countries, drawing on the framework of “exit, voice, and loyalty” developed by Albert Hirschman. The paper concludes that the Chinese “tough model” appears to have facilitated a virtuous circle of the state- people interaction, whereas the US “loose model” has led to a vicious circle.
Topic:: Governance, Hegemony, Public Health, Pandemic, COVID-19, and Rivalry
Political Geography:: China, Asia, North America, and United States of America

247. The Just Transition in Energy

Author:: Ian Goldin
Publication Date:: 12-2020
Content Type:: Working Paper
Institution:: Center on International Cooperation
Abstract:: With each new year of data, and each new intergovernmental report, it becomes harder to deny the scale and urgency of the energy transition required to prevent catastrophic anthropogenic climate change. The Intergovernmental Panel on Climate Change urges countries to take action to prevent a rise in temperature by more than 1.5°C, and warns of catastrophic consequences of a rise above 2°C. Yet current policies and pledges fall far short of hitting these targets. Worse, since harmful climate change is caused by the stock of carbon in the atmosphere, the longer we delay measures to limit the flow of new carbon into the atmosphere, the more drastic those measures will have to be. This uneven distribution of threat and responsibility raises difficult questions. Developed countries are generally more advanced in their transition to renewables, which means that some of the cheapest opportunities to reduce emissions are in developing countries. Yet the fact remains that developed countries are responsible for a larger share of historic emissions—and developing countries may have a right to pursue development unhindered, as developed countries did in earlier decades. There are therefore several elements of the “just transition” in energy. The world needs to transition to cleaner energy, and the developing world needs to keep developing, all while supporting the countries and communities that bear the highest costs of mitigation measures—and supporting those areas already beginning to feel the negative effects of climate change. This report will outline the key challenges and opportunities and conclude with a series of practical steps available to policymakers.
Topic:: Climate Change, Energy Policy, International Security, Crisis Management, and Inclusion
Political Geography:: China, Europe, South Asia, Middle East, India, East Asia, South Africa, Latin America, West Africa, United States of America, and Sub-Saharan Africa

248. Mapping the International Presence of the World’s Largest Arms Companies

Author:: Lucie béraud-Sudreau, Alexandra Marksteiner, Diego Lopes da Silva, Nan Tian, Alexandra Kuimova, Pieter D. Wezeman, and Siemon T. Wezeman
Publication Date:: 12-2020
Content Type:: Working Paper
Institution:: Stockholm International Peace Research Institute
Abstract:: Arms companies have a presence that reaches far beyond the countries in which they are headquartered. This is the result of the internationalization of the arms industry. This paper uses a new data set to examine the results of this internationalization in terms of the international presence of major arms companies. It presents a mapping comprising 400 foreign entities linked to the world’s largest arms companies. The mapping shows that the international presence of major arms companies continues to be influenced by geopolitical divisions and ties, and generally mirrors the geographical locations of the world’s biggest arms import markets. It also reveals that the international presence of major Chinese arms companies and the one Russian company included in the study remains limited. Appendix A lists the 25 largest arms-producing and military services companies in the world, ranked by their arms sales in 2019.
Topic:: Arms Control and Proliferation, Military Spending, and Manufacturing
Political Geography:: Russia, China, Eurasia, and Asia

249. China Global Security Tracker, No.6

Author:: Helena Legarda
Publication Date:: 02-2020
Content Type:: Working Paper
Institution:: International Institute for Strategic Studies
Abstract:: China hits back after NATO calls it a security challenge, dormant Chinese hacking group resumes attacks, and more.
Topic:: Security, Defense Policy, NATO, and Diplomacy
Political Geography:: United States, China, Europe, North Atlantic, Beijing, Asia, Vietnam, and Sri Lanka

250. China and CoronaShock

Author:: Tricontinental: Institute for Social Research
Publication Date:: 04-2020
Content Type:: Working Paper
Institution:: Tricontinental: Institute for Social Research
Abstract:: This is the first in a multiple part series of studies on CoronaShock. It is made up of three articles on how China identified the novel coronavirus and then how the Chinese government and Chinese society fought against its wider diffusion. The report is researched and written by Vijay Prashad (Director of Tricontinental: Institute for Social Research), Du Xiaojun (a translator and linguist from Shanghai), and Weiyan Zhu (an attorney from Beijing). These articles first appeared through the Globetrotter service of the Independent Media Institute. The paintings in this booklet have been done by Li Zhong, an artist from Shanghai. At the end of the booklet is an interview with Li Zhong conducted by Tings Chak (Lead Designer at Tricontinental: Institute for Social Research).
Topic:: Governance, Public Health, Pandemic, and COVID-19
Political Geography:: China and Asia

251. Competing in Artificial Intelligence Chips: China’s Challenge amid Technology War

Author:: Dieter Ernst
Publication Date:: 03-2020
Content Type:: Working Paper
Institution:: Centre for International Governance Innovation
Abstract:: This special report assesses the challenges that China is facing in developing its artificial intelligence (AI) industry due to unprecedented US technology export restrictions. A central proposition is that China’s achievements in AI lack a robust foundation in leading-edge AI chips, and thus the country is vulnerable to externally imposed supply disruptions. The COVID-19 pandemic has further decoupled China from international trade and technology flows. Success in AI requires mastery of data, algorithms and computing power, which, in turn, is determined by the performance of AI chips. Increasing computing power that is cost-effective and energy-saving is the indispensable third component of this magic AI triangle. Research on China’s AI strategy has emphasized China’s huge data sets as a primary advantage. It was assumed that China could always purchase the necessary AI chips from global semiconductor industry leaders. Until recently, AI applications run by leading-edge major Chinese technology firms were powered by foreign chips, mostly designed by a small group of top US semiconductor firms. The outbreak of the technology war, however, is disrupting China’s access to advanced AI chips from the United States. Drawing on field research conducted in 2019, this report contributes to the literature by addressing China’s arguably most immediate and difficult AI challenges. The report highlights China’s challenge of competing in AI, and contrasts America’s and China’s different AI development trajectories. Capabilities and challenges are assessed, both for the large players (Huawei, Alibaba and Baidu) and for a small group of AI chip “unicorns.” The report concludes with implications for China’s future AI chip development.
Topic:: Energy Policy, Science and Technology, Sanctions, and Artificial Intelligence
Political Geography:: United States, China, Asia, and North America

252. Toward a Robust Architecture for the Regulation of Data and Digital Trade

Author:: Dan Ciuriak and Maria Piashkina
Publication Date:: 04-2020
Content Type:: Working Paper
Institution:: Centre for International Governance Innovation
Abstract:: The rapid digital transformation occurring worldwide poses significant challenges for policy makers working within a governance framework that evolved over centuries. Domestic policy space needs to be redefined for the digital age, and the interface with international trade governance recalibrated. In this paper, Dan Ciuriak and Maria Ptashkina organize the issues facing policy makers under the broad pillars of “economic value capture,” “sovereignty” in public choice and “national security,” and outline a conceptual framework with which policy makers can start to think about a coherent integration of the many reform efforts now under way, considering how policies adopted in these areas can be reconciled with commitments under a multilateral framework adapted for the digital age.
Topic:: International Trade and Finance, Reform, Digital Economy, Multilateralism, and Digitization
Political Geography:: United States, China, Europe, Asia, and North America

253. A New Horizon for the Korea-India Strategic and Sustainable Partnership under Korea's New Southern Policy

Author:: Choong Yong Ahn
Publication Date:: 03-2020
Content Type:: Working Paper
Institution:: Korea Economic Institute of America (KEI)
Abstract:: India and South Korea, Asia’s third- and fourth-largest economies, respectively, established a Comprehensive Economic Partnership Agreement (CEPA) in 2010 and upgraded their relationship to a special strategic partnership in 2015. South Korean President Moon Jae-in’s “New Southern” policy and Indian Prime Minister Narendra Modi’s “Act East” policy share important objectives and values through which Korea and India can maximize their potential to pursue high tech-oriented, win-win growth. Both countries face the great challenge of diversifying their economic partners in their respective geo-economic domains amid newly emerging international geo-economic dynamics as well as rapidly changing Fourth Industrial Revolution technologies. Given the two countries’ excessive dependence on the Chinese market and potential risks and uncertainties involved in the U.S.-China trade war and related security conflicts, South Korea and India need to deepen bilateral linkages in trade, investment, and cultural contacts. South Korea-India cooperation is crucial in promoting plurilateralism, prosperity, and harmony in East Asia. This paper suggests a specific action agenda to fulfill mutual commitments as entailed in the “Special Strategic Partnership” between these two like-minded countries of South Korea and India.
Topic:: International Relations, Foreign Policy, Science and Technology, Bilateral Relations, and Industry
Political Geography:: United States, China, South Asia, India, Asia, South Korea, and Korea

254. Framing an Indo-Pacific Narrative in India-South Korea Ties

Author:: Jagannath P. Panda
Publication Date:: 01-2020
Content Type:: Working Paper
Institution:: Korea Economic Institute of America (KEI)
Abstract:: Both India’s and South Korea’s strategic choices are deeply influenced by the rapidly evolving Indo-Pacific construct, particularly amid a mounting U.S.-China rivalry. With India’s “Look/Act East” policy and South Korea’s “New Southern Policy” offering a perfect stage for deepened mutual cooperation, both nations need to further their relations to build Asia’s future while advancing their respective national interests. With both countries following stringent foreign policies as a result of the actions of their immediate neighbors, they present a geopolitically strategic complementarity for their relationship to prosper and emerge as one of the most important relationships in the region. Seoul’s hesitation to overtly embrace the “Indo-Pacific” concept is not really a barrier; rather a geo-political overture to discard the balance of power politics and pursue an autonomous foreign policy. India’s preference for the “Indo-Pacific” is equally based on strategic autonomy, imbibing universal values and an inclusive regional order. Both countries emphasize a free and rules-based Indo-Pacific and have immense potential to establish security and connectivity partnerships as the keystone of their bilateral ties. With India and South Korea understanding the economic importance versus security ramifications of China, and with Japan’s reemergence as a key regional, if not global actor, both countries need to bring serious strategic intent to their relationship. Making use of the ASEAN platform and bilateral dialogues, South Korea and India have the potential to become one of the strongest Indo-Pacific partners of the 21st century
Topic:: International Relations, Foreign Policy, Bilateral Relations, Partnerships, and Geopolitics
Political Geography:: China, South Asia, India, Asia, South Korea, Korea, United States of America, and Indo-Pacific

255. US Nonproliferation Cooperation with Russia and China

Author:: Robert Einhorn
Publication Date:: 10-2020
Content Type:: Working Paper
Institution:: James Martin Center for Nonproliferation Studies
Abstract:: The United States has at times worked cooperatively with Russia and China to promote shared nonproliferation objectives. But with no end in sight to the current precipitous decline in Washington’s bilateral relations with Moscow and Beijing, constructive engagement on today’s nonproliferation challenges has become increasingly problematic. Unless the United States and its two great power competitors can find a way to carve out areas of cooperation in otherwise highly adversarial relationships, the remarkably positive record of international efforts to prevent additional countries from acquiring weapons will be difficult to sustain. From sometimes partners to frequent foes, this Occasional Paper examines the history of US cooperation with Russia and China on key issues including Iran, North Korea, Syria, international nonproliferation mechanisms, and nuclear security. It also outlines the obstacles to future nonproliferation cooperation, as well as the growing proliferation threats that require such cooperation. Most importantly, it identifies several possible areas where the United States can hope to find common ground with both countries. With relationships with Russia and China reaching new lows and unlikely to improve for the foreseeable future, finding a way to for the United States to work cooperatively with both countries will not be easy. Bridges to constructive engagement have been burned and will be difficult to rebuild. However, the author points out that constituencies for cooperation remain in all three countries, including in government bureaucracies. “As hard as it may be to find common ground in otherwise highly adversarial relationships, it is imperative that the US administration in office after January 2021 make every effort to do so. Cooperation with America’s two great power rivals will not always guarantee success, but the absence of such cooperation will surely increase the risk of failure.”
Topic:: Diplomacy, International Cooperation, Nuclear Weapons, Military Strategy, and Nonproliferation
Political Geography:: Russia, China, Europe, Asia, United States of America, and North America

256. China’s BRI: The Development-Finance Dimension

Author:: David Gordon and Haoyu Tong
Publication Date:: 03-2020
Content Type:: Working Paper
Institution:: International Institute for Strategic Studies
Abstract:: This report is the first of two synthesising the findings of a major research workshop convened in Washington DC on 26 June 2019, by The International Institute for Strategic Studies (IISS), as part of its multi-year project on China’s Belt and Road Initiative (BRI). The IISS commissioned ten papers that addressed development-finance and security issues in the BRI, prepared by leading scholars and policy practitioners. They were joined at the workshop by more than two dozen other experts on China’s international behaviour. This first report focuses on development-finance issues in the BRI; the second will address security issues broadly cast. China’s Belt and Road Initiative is now six years old. Announced by (then) newly ensconced President Xi Jinping, it has since become the centrepiece of Xi’s ambitious drive to make China a more active global leader, and to break free from the cautious approach set out more than 30 years earlier by then-paramount-leader Deng Xiaoping – that China’s strategic approach should be to ‘hide its capacities and bide its time’. At the Chinese Communist Party’s (CCP) 19th Congress in 2017, the BRI was integrated into the party’s charter. Much of the early analytical work on the BRI has focused on questions surrounding China’s motivations – economic or geopolitical. Is Xi’s initiative a response to changing domestic economic circumstances? Or does it signal evidence of China’s intent to build a twentyfirst- century imperium modelled on the post-war United States-led experience, more than on European colonial or earlier Asian empires? The emerging consensus on this question is that it has been a bit of both. At the same time, an often overlooked factor is Xi’s constant need to further consolidate his power inside China, as the economics versus geopolitics debate about the motivations for the BRI gives too little attention to the more purely political dimension. The BRI cannot be separated from Xi’s efforts to cast himself domestically as an exceptional leader for an exceptional moment in China’s history.
Topic:: Development, Globalization, Infrastructure, Hegemony, and Belt and Road Initiative (BRI)
Political Geography:: China and Asia

257. Assessing Chinese defence spending: proposals for new methodologies

Author:: Meia Nouwens
Publication Date:: 03-2020
Content Type:: Working Paper
Institution:: International Institute for Strategic Studies
Abstract:: Little is known about how China’s growing defence budget is allocated, particularly following recent structural reforms. In the absence of publicly available information and new research on Chinese defence economics, outside observers consider the official data to be incomplete. Publications addressing Chinese defence spending often claim that ‘it is widely believed’ official Chinese statistics exclude key categories of military-related spending. For instance, in 2003, one analyst wrote that ‘it is widely accepted that the official budget released by the Chinese every year accounts for only a fraction of actual defense spending. In particular, whole categories of military expenditure are believed to be missing from official figures.’ The methodologies employed by research institutions, such as the International Institute for Strategic Studies (IISS) and the Stockholm International Peace Research Institute (SIPRI), to estimate China’s total military spending date back to the late 1990s. Furthermore, existing estimates do not take into account China’s recent military reorganisation under President Xi Jingping’s direction, which began in 2015, and a wide range of defence reforms. For example, in 2018, the Chinese authorities integrated the China Coast Guard (CCG), the People’s Armed Police (PAP) and the maritime militias into the Central Military Commission’s (CMC’s) command structure. It is currently unclear how this restructuring has affected China’s defence spending. In addition, China’s defence spending could have been affected by the increasing fulfilment of weapons procurements by domestic firms. Therefore, a reassessment of China’s defence spending and the methodologies employed is required.
Topic:: Defense Policy, Military Strategy, Military Affairs, and Budget
Political Geography:: China and Asia

258. The PLA’s Mask Diplomacy

Author:: Helena Legarda
Publication Date:: 08-2020
Content Type:: Working Paper
Institution:: International Institute for Strategic Studies
Abstract:: Much has been written about China’s “mask diplomacy” during the Covid-19 pandemic. As the epicenter of the pandemic shifted from China to the rest of the world, China’s government sent planeloads of masks and medical supplies to hard-hit countries around the world. Beijing’s “mask diplomacy” sought to bolster China’s image as a responsible global power and was widely perceived as part of Beijing’s attempt to control the narrative around the pandemic and distract from its initial cover-up. But while all the attention focused on the Chinese government’s actions, the People’s Liberation Army (PLA) was carrying out its own, much quieter version of mask diplomacy. According to MERICS data, in the three months between March 13 and June 19, the PLA sent military planes full of medical material to 46 countries. The material, which mostly consisted of masks and personal protective equipment (PPE), was invariably donated to the recipient countries’ armed forces or defense ministries. The PLA also set up video conferences with foreign militaries to share its experiences of fighting the Covid-19 outbreak and strengthen military-to-military relations. At first glance, the Chinese government’s mask diplomacy campaign and the PLA’s look remarkably similar. However, a number of differences suggest there were different goals and strategies at play.
Topic:: Diplomacy, Public Policy, Pandemic, and COVID-19
Political Geography:: China and Asia

259. China’s BRI: The Security Dimension

Author:: David F Gordon, Haoyu Tong, and Tabatha Anderson
Publication Date:: 09-2020
Content Type:: Working Paper
Institution:: International Institute for Strategic Studies
Abstract:: In this second report published by the IISS Belt and Road Initiative (BRI) Project under the Geo-Economics, Geopolitics and Strategy Programme, the authors examine a range of security-related challenges that the BRI confronts as it expands into diverse geographies to China’s west and south. The report explores the risks in operating across environments fraught with political, economic and social instability. Beyond this, it delves into the actual and potential challenges that the BRI faces from Islamic extremism and terrorism. The report also assesses the ways in which the Maritime Silk Road (MSR) fits into China’s growing strategic interests in Southeast Asia, and the development of the Digital Silk Road (DSR) at the forefront of the technological and geopolitical competition between China and the United States. Finally, the report explores the China–Pakistan Economic Corridor (CPEC) as a case study of the security risks and governance challenges present in what is probably the single most important country-wide BRI endeavour.
Topic:: Regional Cooperation, Infrastructure, Hegemony, Digital Economy, Belt and Road Initiative (BRI), and Silk Road
Political Geography:: Pakistan, China, and Asia

260. Defeating Threat Air Defences: the Return of the DEAD

Author:: International Institute for Strategic Studies
Publication Date:: 12-2020
Content Type:: Working Paper
Institution:: International Institute for Strategic Studies
Abstract:: For the past two decades the US and its allies have faced a very limited surface-to-air threat in wars in which they have engaged. This is now changing as the worsening security environment and the emergence of near-peer rivals once again raises the spectre of a strongly contested air domain. A central element of the renewed challenge is the surface-to-air missile (SAM) system. China and Russia have fielded and continue to develop SAM systems across all range categories – and to offer many of these for export – that pose a credible threat to air operations. The US, and to an even greater extent the Europeans, have reduced emphasis and expenditure on what is known as the suppression of enemy air defence (SEAD) role. Counter-insurgency rather than counter-integrated air-defence operations have been the priority since the turn of the century. There is now, however, the renewed challenge of being able to carry out air operations in airspace defended by the latest generations of point-, short-, medium- and long-range SAM systems. Low-observable aircraft only offer a partial solution, particularly as the US and its allies will operate mixed fleets of stealthy and non-stealthy combat aircraft at least until around the middle of the century. The latter types of aircraft remain at greater risk from SAM threats than low-observable aircraft, and their operational utility will depend partly on the wider capacity to counter surface-based threat missile systems. SEAD is an asset-intensive capability, particularly in the early days of a conflict, and has traditionally involved dedicated platforms as well as fighter ground-attack aircraft. In SEAD operations in the 1990s, such as Operation Allied Force during the 1999 Kosovo conflict, up to one-third of strike missions were tasked against ground-based air defences. While the force mix will change as uninhabited systems are increasingly adopted in the inventory, a variety of crewed and uninhabited aircraft and associated weaponry will still be required for the task, and will be required in numbers greater than are available in current inventories if faced by a peer or near-peer threat. Collating what is known as an electronic order of battle against peer and near-peer rivals should once again become a priority, as should the capacity to counter, disable or destroy surface-to-air threat systems.
Topic:: Foreign Policy, Defense Policy, Military Strategy, and Missile Defense
Political Geography:: Russia, China, Europe, Asia, North America, and United States of America

261. The impact of COVID-19 on organised crime in the Western Balkans

Author:: International Institute for Strategic Studies
Publication Date:: 12-2020
Content Type:: Working Paper
Institution:: International Institute for Strategic Studies
Abstract:: The fourth in a series analysing the ways COVID-19 is affecting stability across the world, this paper explores the impact on organised crime in the Western Balkans of the health and economic crisis brought about by the pandemic. Criminal organisations active in the Western Balkans have proved very apt at exploiting the evolution of the pandemic and related government responses to expand their activities regionally and globally. The key role played by the European Union in recent times to promote the rule of law and institutional reforms against organised crime in the region is at risk of setback given its limited economic firepower post-COVID-19 and China’s increasing influence through its economic and investment diplomacy. Law-enforcement agencies will struggle to prevent criminal groups from further infiltrating the region’s economies amid increasing budgetary constraints. Western Balkans governments should use the current challenging circumstances as an opportunity to redefine medium- and long-term priorities in their efforts against organised crime. However, for these efforts to be successful, the sustained political and operational support of other countries will be needed, given the expanding international reach of regional criminal groups.
Topic:: Political stability, Public Health, Pandemic, COVID-19, and Organized Crime
Political Geography:: China, Europe, Asia, and Balkans

262. China's Rise as a Global Security Actor: Implications for NATO

Author:: Meia Nouwens and Helena Legarda
Publication Date:: 12-2020
Content Type:: Working Paper
Institution:: International Institute for Strategic Studies
Abstract:: In December 2019, for the first time, NATO leaders recognised China as a new strategic point of focus for the Alliance. This reflects growing concern among NATO members surrounding China’s geopolitical rise and its growing power-projection capabilities, as well as the impact that these may have on the global balance of power. Today, China is not only taking a central role in Indo-Pacific security affairs but is also becoming an increasingly visible security actor in Europe’s periphery. As such, the question of how to deal with an increasingly global China has been an important part of Secretary-General Jens Stoltenberg’s NATO 2030 reflection process. China poses a wide range of challenges to NATO. Beijing sees the Alliance as a United States-centric outfit that may be used by Washington to contain China, and has therefore tried to influence individual NATO members’ decisions in order to weaken the Alliance’s unity. Close ties between China and Russia, especially in the security and military spheres, have also been a source of concern for NATO allies. Besides the Chinese and Russian navies’ joint exercises in the Baltic and Mediterranean seas, there is also the potential for the two sides to further coordinate – or at least align their behaviour – on issues of relevance to the Alliance, including hybrid warfare and cyber espionage, arms-control issues, and their approach to Arctic governance, among others. China’s defence spending and military-modernisation process, along with the growing strength of its defence industry, have led to the proliferation of more advanced military platforms around the world. Beijing is also expanding its stockpile of missiles, some of which have the range to reach NATO countries. China’s military-power-projection capabilities have likewise edged towards Europe as the People’s Liberation Army (PLA) has expanded its international presence over the last few years. While NATO allies may have agreed that China presents a number of challenges to the Alliance’s security, they have yet to achieve consensus on how to address them. Some of these issues lie beyond NATO’s traditional areas of competence and will require expertise best provided by partners of the Alliance rather than the Alliance itself. NATO allies will need to prioritise how, when, where and with which partners to use their combined resources to deal with them. At the same time, the Alliance acknowledges that China is not its adversary. NATO thus must find areas of common interest where it can continue to cooperate with China, albeit with a more clear-eyed approach than it has done in the past. Addressing the opportunities and problems posed by China as a cohesive alliance will be more important than ever.
Topic:: Security, Foreign Policy, Defense Policy, NATO, Diplomacy, Regional Cooperation, and Hegemony
Political Geography:: China, Europe, North Atlantic, Asia, and North America

263. Increasing Nuclear Threats through Strategic Missile Defense

Author:: Greg Thielmann
Publication Date:: 06-2020
Content Type:: Working Paper
Institution:: Center for International and Security Studies at Maryland (CISSM)
Abstract:: Growing concerns about third-country nuclear threats led the United States to withdraw from the ABM Treaty’s constraints on the size and scope of ballistic missile defense arsenals in 2002. Inaccurate and alarmist projections of “rogue state” ICBM threats were critical in winning support for the decision to withdraw from the treaty and to sustain the multi-billion dollar annual price tag for developing, deploying, and expanding strategic missile defenses. But 18 years after Washington abandoned the treaty, North Korea is the only rogue state that could pose a near-term nuclear threat against the American homeland—and U.S. missile defense interceptors and radars have not even delivered high confidence of being able to protect against this threat. Meanwhile, the absence of limits on U.S. strategic missile defenses and prudent, worst-case concerns in Moscow and Beijing about their future expansion are fueling resistance to additional nuclear arms reductions and stability measures. The end result is that the exponential threats posed by Russia and China are getting worse and the chances of a disastrous nuclear arms race are increasing. This analysis argues that the nuclear threat confronting the United States is multilateral, three-dimensional, and interrelated. Unless the United States acknowledges the role of missile defenses in this complicated reality, it will not be able to realize the full benefits that arms control offers.
Topic:: Defense Policy, Nuclear Weapons, Military Strategy, Nuclear Power, and Missile Defense
Political Geography:: Russia, China, Europe, Asia, North America, and United States of America

264. Iran's Influence in the Middle East

Author:: Jadranka Polovic
Publication Date:: 08-2020
Content Type:: Working Paper
Institution:: Institute for Development and International Relations (IRMO)
Abstract:: The Middle East as one of the most heterogeneous and politically conflicting regions in the world and has long been at the center of international interest. Faced with sectarian wars and comprehensive social crises for decades the Middle East, due to its geostrategic importance and especially the imperative of controlling the region’s vast energy resources, has once again become a battle ground for major powers whose interests affect the concentration of participants in the region. The competition between global powers and growing influence of Russia and China, who undermine the US power and European Union’s influence and also undermine established alliances in the Middle East, undoubtedly require a rethinking of Western strategies for the region. A series of geopolitical challenges, especially after September 11 attacks against the United States, as a result of military interventions and civil wars (Afghanistan, Iraq, Libya and Syria) and uprisings (Arab Spring) and thus the collapsed regional order, confronted the international community with the changing nature of security threats, as well as with the new balance of power of regional and international actors in the Middle East. Among the many aspects of the Middle East conflicts, the fundamental issue of regional security today is the Sunni-Shiite conflict, which has since the invasion of Iraq in 2003 directly defined the approaches and policies of great powers and significantly changed regional dynamics. In this context, Iran’s role is particularly significant. Namely, over the last two decades, Iran has consolidated its goals in the Persian Gulf and strategically expanded its influence to other countries in the Middle East, primarily Iraq, Syria, Lebanon and Yemen. The growing influence of Shiite Iran, and its close relations with Shiite communities in the region with which it forms a strategic coalition, have become a key geopolitical challenge for the international community.
Topic:: Foreign Policy, Energy Policy, International Cooperation, Natural Resources, and Hegemony
Political Geography:: Russia, China, Europe, Iran, Middle East, Asia, North America, and United States of America

265. Potential Reserve Army and Diverging Paths of Transition in Former State Socialist Economies

Author:: Zhun Xu
Publication Date:: 08-2020
Content Type:: Working Paper
Institution:: Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:: Since the rise of neoliberalism in the world in the last quarter of the 20th century, many former state socialist economies also started their transition into different kinds of market economic models. Over the course of the last three decades or so, there emerged distinct paths of transition among these economies. This paper proposes a Marxian framework to help understand the three major models of transitions among former socialist economies: the Russian path, the Chinese path, and the Cuban/North Korean path. The framework focuses on the differences in working class composition and in particular the size of the potential reserve army in these socialist economies. An examination of the historical process of market reforms in former state socialist economies suggests that a sizable potential reserve army could give rise to a gradual approach to neoliberal transition while a negligible potential reserve army could lead to either a shock therapy or a long impasse.
Topic:: Political Economy, Neoliberalism, Socialism, and Market Economy
Political Geography:: Russia, China, North Korea, and Cuba

266. The State's Response to the Crisis of Neoliberalism: A Comparison of the Net Social Wage in China and the United States, 1992-2017

Author:: Katherine Moos and Hao Qi
Publication Date:: 08-2020
Content Type:: Working Paper
Institution:: Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:: We compare the welfare states and taxation regimes of the two largest economies in the world, China and the United States, from 1992 to 2017. We begin with a comparison of each country’s net social wage—that is, the difference between total benefits received by and taxes paid by labor—using two established methods. While the net social wage in the two countries exhibited similar trends, the increasing net social wage has distinctly different implications in the two countries due to their specific historical trajectories in the neoliberal era. In the US, the increasing net social wage reflects an ambivalent and reluctant response to workers’ social reproduction. In China, it reflects institutional changes in the welfare state, which we interpret as the Chinese state’s attempt to resolve the social-reproduction crisis caused by neoliberal reforms of the 1990s.
Topic:: Political Economy, Economy, Neoliberalism, Crisis Management, and Welfare
Political Geography:: China and United States of America

267. The U.S.–China Trade Imbalance and the Theory of Free Trade: Debunking the Currency Manipulation Argument

Author:: Anwar Shaikh and Isabella Weber
Publication Date:: 03-2020
Content Type:: Working Paper
Institution:: Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:: The U.S.–China trade imbalance is commonly attributed to a Chinese policy of currency manipulation. However, empirical studies failed to reach consensus on the RMB misalignment. We argue that this is not a consequence of poor measurement but of theory. At the most abstract level the conventional principle of comparative cost advantage suggests real exchange rates will adjust so as to balance trade. Therefore, the persistence of trade imbalances tends to be interpreted as arising from currency manipulation facilitated by foreign exchange interventions. By way of contrast, the absolute cost theory explains trade imbalances as the outcome of free trade among nations that have unequal real costs. We argue that a disparity in real costs is the root cause of the U.S.–China trade imbalance.
Topic:: Exchange Rate Policy, Free Trade, Trade, and Purchasing Power
Political Geography:: China, Asia, North America, and United States of America

268. Oil Prices and Stock Prices in Clean Energy: New Evidence from Chinese Subsectoral Data

Author:: Dong Weijia
Publication Date:: 02-2020
Content Type:: Working Paper
Abstract:: The International Energy Agency (IEA) believes that the world needs a clean energy revolution to break its dependence on fossil fuels. Clean energy consists of not just the new energy but also the vehicles that use them,2 including renewable energy, nuclear power, and biofuels. In this context, many studies discuss whether clean energy could have a significant substitution effect on traditional fossil fuels, especially oil.
Topic:: Energy Policy, Oil, and Trade
Political Geography:: China and Asia

269. The cross-border impacts of China’s official rate shocks on stock returns of Chinese concepts shares listed on U.S. market

Author:: Dong Weijia
Publication Date:: 02-2020
Content Type:: Working Paper
Abstract:: This paper examines a new cross-border effect of an emerging country’s interest rate changes on the stock returns of its domestic firms listed overseas. First, we discover that the increase in China’s official interest rate greatly affects the NYSE-listed Chinese stocks, thereby suggesting that similar to Chinese domestic investors, the institutional investors in a mature market sometimes exhibit irrational sentiment driven by an emerging economy’s unexpected monetary policy shocks. Second, we highlight some novel asymmetric impacts of China’s official rate changes on Chinese concepts stock prices and reveal that these effects differ from the conventional nonlinear effects of monetary policies. For instance, a bull and bear regime has no statistically significant asymmetric effect on NYSE, whereas interest rate rise has different cross-border impact on Nasdaq and NYSE markets. These interesting findings are mainly driven by the smart investors in the U.S. stock market who are knowledgeable about the differences between NYSE- and Nasdaq-listed stocks and carefully analyze the different impacts of China’s official interest rate changes on the fundamentals of different types of Chinese concepts stocks.
Topic:: International Trade and Finance, Bilateral Relations, and Investment
Political Geography:: China, Asia, North America, and United States of America

270. Comovement of Home Prices: A Conditional Copula Approach

Author:: Lei Hou, Wei Long, and Qi Li
Publication Date:: 02-2020
Content Type:: Working Paper
Abstract:: Even though housing markets in different areas are relatively localized, regional home prices have become closely correlated and tend to be simultaneously affected by many national economic factors. In this paper, through the dynamic copula model, we confirm that regional home price dependence is time-varying and the conventional time-invariant copulas underestimate the degree of dependence during economic expansions and recessions. In essence, the U.S. residential real estate market has become more integrated since the mid-1980s. Using the conditional copula model, we further identify how the dependence among regional housing markets evolves along with some fundamental economic factors such as unemployment rate and interest rate. These findings can help investors and home buyers to better identify and evaluate the systematic risk in the nationwide housing market.
Topic:: Economics, Unemployment, and Housing
Political Geography:: China, Asia, North America, and United States of America

271. Evaluating the impact of fossil fuel vehicles exit on the oil demand in China

Author:: Ziru Feng, Tian Cai, Kangli Xiang, Chenxi Xiang, and Lei Hou
Publication Date:: 03-2020
Content Type:: Working Paper
Abstract:: Vehicle ownership is one of the most important factors affecting fuel demand. Based on the forecast of China's vehicle ownership, this paper estimates China’s fuel demand in 2035 and explores the impact of new energy vehicles under the scenarios of slow, medium, and rapid substitution. The main contribution of this paper is making a more detailed estimation on the main parameters such as the saturation level and growth rate of the vehicle ownership by taking into account the heterogeneity of provinces when using the Gompertz model to forecast the future vehicle ownership. On that basis, the fuel demand of each province in 2035 is calculated. The results show that: ①The vehicle ownership rate of each province conforms to the S-shape trend with the growth of real GDP per capita. At present, most provinces are at a stage of accelerating growth. However, the time for the vehicle ownership rate of each province to reach the inflection point is quite different. ②Without considering the replacement of new energy vehicles, China's auto fuel demand is expected to be 746.69 million tonnes (Mt) in 2035. Guangdong, Henan, and Shandong are the top three provinces in fuel demand due to the economic and demographic factors, with the expected fuel demand of 76.76, 64.91 and 63.95Mt respectively. ③Considering the replacement of new energy vehicles, China’s fuel demand in 2035 will be 653, 615 and 578 Mt respectively under the scenarios of slow, medium and fast substitution. Even under the scenario of slow substitution, the reduction in fuel demand will be 94 Mt, accounting for 26.3% of China's net oil imports in 2016. Therefore, the withdrawal of fuel vehicles will greatly reduce the oil demand and the dependence on foreign oil of China. Faced with the dual pressure of environmental crisis and energy crisis, the forecast results of this study provide practical reference for policy makers to rationally design the future fuel vehicle exit plan and solve related environmental issues.
Topic:: Climate Change, Oil, and Fossil Fuels
Political Geography:: China, Asia, and United States of America

272. WTO accession, trade expansion, and air pollution: Evidence from China’s county-level panel data

Author:: Shuai Chen, Faqin Lin, Xi Yao, and Peng Zhang
Publication Date:: 07-2020
Content Type:: Working Paper
Abstract:: This study provides evidence that trade expansion has contributed to the degradation of air pollution in China. On the basis of different responses of counties’ trade to China’s World Trade Organization accession at the end of 2001, we exploit air pollution data from NASA to construct a difference-in-differences predicted trade as an instrument for our identification. We document statistically significant and robust evidence on trade expansion, which accounts for approximately 60% and 20% for the increase of PM2.5 and SO2, respectively, in China. Findings on trade pollution relation are robust to various tests. Deterioration in the environment is mainly driven by scale and trade in polluting sectors.
Topic:: Trade, Pollution, and WTO
Political Geography:: China and Asia

273. The Impact of COVID-19 on World Economy and China’s Role

Author:: Xu Xiujun
Publication Date:: 07-2020
Content Type:: Working Paper
Abstract:: Recent years have seen more countries to experience “three lows and three highs” problems. The pandemic triggered the exposure of these accumulated risks, leading to a slump in world economic growth. Given the developing trend of world economy amid the ongoing pandemic, the world may face a range of challenges for a long time to go, e.g. insufficient momentum for economic growth, increased resistance for market opening and rising debt risks. As the world economy suffers a major hit, China has been active in providing the international community with the assistance needed to combat the COVID-19 and recover the economy, while China’s economy itself has shown strong resilience and stability. In the long run, the pandemic will not change the sound momentum of China’s economic development; rather, it will provide an opportunity for China to play a significant role in the world economy.
Topic:: Economy, Global Political Economy, and COVID-19
Political Geography:: China and Asia

274. Fight the COVID-19 Pandemic and Improve Global Health Governance

Author:: Lin Ren, Aizong Xiong, Guoding Wu, Chen Shen, Xu Tian, and Bo Peng
Publication Date:: 07-2020
Content Type:: Working Paper
Abstract:: The fast spreading of the COVID-19 across the globe points to the urgency of strengthening global health governance. As the core global health governance institution, the WHO has taken a series of actions after the eruption of the epidemic and played an important role in providing guidance and coordinating global forces to combat the epidemic. The epidemic, however, has also exposed some defects of the global health governance mechanism, especially the WHO, and posed challenge to it. The international community needs to strengthen its support for the WHO to improve its role in the global health governance.
Topic:: Health, Governance, and COVID-19
Political Geography:: China, Asia, and Global Focus

275. An International Intellectual Property and Digital Trade Strategy for Canada

Author:: Jeremy de Beer
Publication Date:: 10-2020
Content Type:: Working Paper
Institution:: Centre for International Governance Innovation
Abstract:: To remain competitive on a global scale, Canada needs to enhance its domestic intellectual property (IP) and digital trade strategies with an international approach that can respond to constantly changing global economic conditions. Although Canada launched its Intellectual Property Strategy in 2018 — focusing on IP awareness, strategic tools and legislation — its data initiative, known as the Digital Charter, remains a work in progress. Both policies would benefit from an outward-looking, interconnected, international strategic vision. As a member of various international trade agreements, Canada has framed its IP laws to align with these agreements and its trade partners. Canada should expand its trade relationships with Africa before other countries, such as China, take advantage of the continent’s rapidly growing economies and trade opportunities. Building strategic alliances with the right global partners, combined with the use of hard and soft laws to promote Canadian interests, will help Canada strengthen its international IP and digital trade strategy.
Topic:: International Cooperation, Intellectual Property/Copyright, Digital Economy, and Trade
Political Geography:: China, Canada, Asia, and North America

276. At a Crossroads? China-India Nuclear Relations After the Border Clash

Author:: Toby Dalton and Tong Zhao
Publication Date:: 08-2020
Content Type:: Working Paper
Institution:: Carnegie Endowment for International Peace
Abstract:: While both countries may think the situation is under control, dismissive attitudes and misperceptions could end up fueling a dangerous competition. On June 15, 2020, a lethal military conflict over disputed territory in the Himalayas shook the edifice of China-India relations. The clash in the Galwan Valley along their shared border is the gravest military confrontation the two nuclear powers have faced in fifty years. This event and ongoing tensions focus attention on the long-standing but tempered competition between China and India. One of the most interesting puzzles of that relationship is why nuclear weapons, which both possess, have not played a more important role. With the potential for a major reset in China-India ties after the Ladakh crisis, are Beijing and New Delhi finally approaching a long-anticipated crossroads in their nuclear relations? The findings reveal that while Indian security analysts give serious attention to China’s nuclear policy and capabilities, Chinese analysts maintain a dismissive attitude about the relevance of nuclear weapons in China-India relations. The attitude stems from a widely held view that India’s indigenous military technologies are significantly behind China’s and that China will continue widening the gulf between the two countries’ conventional and nuclear capabilities. However, Chinese analysts do not appear to fully appreciate the long-term destabilizing implications of this growing gap. India may feel pressure to build out its nuclear arsenal, and this could further threaten the fragile stability between India and Pakistan. Chinese experts tend to underestimate the role Beijing may have in shaping New Delhi’s threat perception and nuclear strategy.
Topic:: International Relations, Nuclear Weapons, Military Affairs, and Borders
Political Geography:: China, South Asia, India, and Asia

277. East Asia decouples from the United States: Trade war, COVID-19, and East Asia's new trade blocs

Author:: Peter A. Petri and Michael G. Plummer
Publication Date:: 06-2020
Content Type:: Working Paper
Institution:: Peterson Institute for International Economics
Abstract:: he deepening US-China trade war and nationalist reactions to the COVID-19 pandemic are reshaping global economic relationships. Alongside these developments, two new megaregional trade agreements, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the Regional Comprehensive Economic Partnership (RCEP), will refocus East Asia’s economic ties in the region itself. The new accords are moving forward without the United States and India, once seen as critical partners in the CPTPP and RCEP, respectively. Using a computable general equilibrium model, we show that the agreements will raise global national incomes in 2030 by an annual $147 billion and $186 billion, respectively. They will yield especially large benefits for China, Japan, and South Korea and losses for the United States and India. These effects are simulated both in a business-as-before-Trump environment and in the context of a sustained US-China trade war. The effects were simulated before the COVID-19 shock but seem increasingly likely in the wake of the pandemic. Compared with business as before, the trade war generates large global losses rising to $301 billion annually by 2030. The new agreements offset the effects of the trade war globally, but not for the United States and China. The trade war makes RCEP especially valuable because it strengthens East Asian interdependence, raising trade among members by $428 billion and reducing trade among nonmembers by $48 billion. These shifts bring regional ties closer to institutional arrangements proposed in the 1990s and incentivize greater cooperation among China, Japan, and South Korea.
Topic:: Treaties and Agreements, Trade Wars, Trans-Pacific Partnership, Free Trade, COVID-19, and Protectionism
Political Geography:: China, Asia, North America, and United States of America

278. How the United States marched the semiconductor industry into its trade war with China

Author:: Chad P. Bown
Publication Date:: 12-2020
Content Type:: Working Paper
Institution:: Peterson Institute for International Economics
Abstract:: The US-China trade war forced a reluctant semiconductor industry into someone else’s fight, a very different position from its leading role in the 1980s trade conflict with Japan. This paper describes how the political economy of the global semiconductor industry has evolved since the 1980s. That includes both a shift in the business model behind how semiconductors go from conception to a finished product as well as the geographic reorientation toward Asia of demand and manufactured supply. It uses that lens to explain how, during the modern conflict with China, US policymakers turned to a legally complex set of export restrictions targeting the semiconductor supply chain in the attempt to safeguard critical infrastructure in the telecommunications sector. The potentially far-reaching tactics included weaponization of exports by relatively small but highly specialized American software service and equipment providers in order to constrain Huawei, a Fortune Global 500 company. It describes potential costs of such policies, some of their unintended consequences, and whether policymakers might push them further in the attempt to constrain other Chinese firms.
Topic:: Science and Technology, Trade Wars, Industry, and Protectionism
Political Geography:: China, Asia, North America, and United States of America

279. Putting A Spoke In The Wheel: Russian Efforts To Weaken U.S.-led Alliance Structures In Northeast Asia

Author:: James D. J. Brown
Publication Date:: 06-2020
Content Type:: Working Paper
Institution:: Korea Economic Institute of America (KEI)
Abstract:: Russia is widely accused of employing a range of instruments—both overt and covert—to undermine Western unity. However, to what extent is Russia engaged in comparable activities to weaken the South Korean and Japanese alliances with the United States? This paper answers this question by assessing Moscow’s actions in the domains of diplomacy, information, the military, and the economy. It finds that Russia is indeed aiming to encourage Seoul and Tokyo to distance themselves from Washington and from each other. In particular, Moscow is committed to deterring U.S. allies from facilitating the deployment of additional units of U.S. missile defense systems within the region. Across the four domains, it is only in the economic field that Russia is found to lack leverage. Overall, Moscow has achieved several tactical victories, but has yet to seriously damage U.S.-led alliance structures within the region. All the same, Seoul and Tokyo must remain watchful of Moscow’s activities, especially since there are signs of increased cooperation between Russia and China in exploiting wedge issues between the United States and its allies, thereby potentially combining China’s economic weight with Russia’s skills in influence operations.
Topic:: International Relations, Foreign Policy, Defense Policy, Economy, and Alliance
Political Geography:: Russia, China, Eurasia, and United States of America

280. Transforming informal work and livelihoods in China

Author:: Carl Shu-Ming Lin, Linxiang Ye, and Wei Zhang
Publication Date:: 11-2020
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: The informal sector has long been viewed as a locus of the disadvantaged, unskilled, and inexperienced workers in under-developed and developing economies. Workers in the informal sector, however, can learn skills and gain experience that could help them switch to better-paying jobs in the formal sector. But evidence of this is limited. China constitutes an important case study because it is the most populous country and has the largest labour force, consisting of over 290 million rural-to-urban migrants whose employment is mostly informal. Using three waves of nationally representative household surveys from 2014 to 2018, we study how the livelihoods of Chinese workers change when transitioning to different work statuses within or between formal and informal sectors. Our results show that transitioning jobs from the informal to the formal sector and from the self-employed to the wage-employed increases earnings, which improves the livelihoods of Chinese workers.
Topic:: Employment, Economic Development, Informal Economy, and Workforce
Political Geography:: China and Asia

281. Preparing for the Nightmare: Readiness and Ad hoc Coalition Operations in the Taiwan Strait

Author:: Mark Stokes, Yang Kuang-shun, and Eric Lee
Publication Date:: 09-2020
Content Type:: Working Paper
Institution:: Project 2049 Institute
Abstract:: Taiwan’s (Republic of China, ROC) defense readiness can be viewed from both strategic and operational perspectives. In our report, readiness is measured by both (1) the degree to which Taiwan’s government and civil society are prepared to counter coercion by the Chinese Communist Party (CCP), and (2) the degree to which the ROC armed forces can carry out its mission. Given the increasing likelihood of CCP use of force against Taiwan in the foreseeable future, it is in the interests of the United States and the ROC governments to improve overall defense readiness. This report evaluates the threat environment Taiwan faces and details its strategic and operational readiness, as well as the utility of ad hoc coalitions. In addition, the report highlights future opportunities for U.S. policymakers to strengthen the United States and Taiwan’s readiness in pursuit of the shared goal of peace and stability in a free and open Indo-Pacific region.
Topic:: Conflict Prevention, Strategic Stability, Coalition, and Readiness
Political Geography:: China, Taiwan, and Asia

282. Don’t be rude, don’t be docile! How to manage freedom of manoeuvre in tense bilateral diplomacy

Author:: Hans Mouritzen
Publication Date:: 11-2020
Content Type:: Working Paper
Institution:: Danish Institute for International Studies (DIIS)
Abstract:: Bilateral diplomacy has become increasingly important in today’s multipolar world. A number of cases are analysed in this DIIS Working Paper, where Nordic countries have been ‘disciplined’ in bilateral diplomacy by the emerging great powers of Russia, China, or India. Compared to the immediate aftermath of the Cold War, with US unipolarity and EU normative power, the Nordics have experienced a narrowing of their freedom of manoeuvre. It is no longer possible, without significant costs, to criticise these great powers’ internal affairs or foreign policies based on allegedly universal values. In general, it is crucial for decision-makers not to overstep their state’s freedom of manoeuvre. But on the other hand, they should not be too docile and desist from occasionally challenging its limits. Trial balloons or parallel action with related countries might do exactly that.
Topic:: Foreign Policy, Diplomacy, Power Politics, and Bilateral Relations
Political Geography:: Russia, China, India, Norway, Denmark, Sweden, and United States of America

283. Weaponizing the Belt and Road Initiative

Author:: Daniel R. Russel and Blake Berger
Publication Date:: 09-2020
Content Type:: Working Paper
Institution:: Asia Society
Abstract:: China’s Belt and Road Initiative (BRI), launched by President Xi Jinping in 2013, is a massive international infrastructure program involving nearly 140 countries with over an estimated $1 trillion in projects related to energy, transportation, digital networks, and trade. Chinese leaders frame the BRI as “win-win” cooperation focused solely on development and connectivity. Beijing has gone to great lengths to minimize BRI’s links to the People’s Liberation Army and to downplay the initiative’s geostrategic overtones. Nevertheless, many governments have become worried about ulterior motives behind BRI projects, many of which have dual-use commercial-military capabilities and are increasingly connected to Chinese digital technologies and networks and satellite systems. The Asia Society Policy Institute’s – Weaponizing the Belt and Road Initiative – examines key BRI projects in the Indo-Pacific and explores relevant Chinese doctrine, the involvement of the People’s Liberation Army with BRI, and assesses the potential military and geostrategic advantages to China from BRI ports and other projects. This project is led by ASPI Vice President for International Security and Diplomacy Daniel Russel, with support from ASPI Senior Program Officer Blake Berger. The project and the report benefitted from advisement from experts and officials in Singapore, Australia, Japan, Vietnam, China, and the United States as well as to the expert advisory group whose distinguished members generously shared their time and wisdom to support this effort.
Topic:: Development, Geopolitics, Belt and Road Initiative (BRI), and Strategic Competition
Political Geography:: China and Asia

284. Climate Diplomacy under a New U.S. Administration

Author:: Thom Woodroofe and Brendan Guy
Publication Date:: 04-2020
Content Type:: Working Paper
Institution:: Asia Society
Abstract:: The United States is the world’s second-largest greenhouse gas emitter. For that reason, the outcome of the U.S. presidential election in November will have an undeniable impact on the future of the global climate change regime. This is especially the case now that the United Nations’ COP26 Climate Change Conference has been postponed to 2021 as a result of the COVID-19 pandemic. Indeed, as Asia and the rest of the world consider whether and how to step up their levels of ambition as part of the five-year ratchet mechanism of the Paris Agreement, the United States has the potential to be either a catalytic force for that effort going into 2021 or an even stronger spoiler of the Agreement’s ongoing effectiveness at a crucial juncture. No country will be watching more closely than China. The 2014 U.S.-China Joint Announcement on Climate Change between President Barack Obama and President Xi Jinping proved to be the watershed moment in the lead-up to the Paris Agreement, as the two countries signaled for the first time that they would act in a coordinated manner to combat climate change. Whether the United States and China can recapture that spirit of shared ambition in the future will have ripple effects on the positions of other major emitters as well—especially India, Japan, and Australia, which may not enhance their own levels of ambition without a stronger indication of further action by the United States and China. While President Donald Trump has begun the process of withdrawing the United States from the Paris Agreement and rolled back domestic and international measures to combat climate change, it is clear that if a Democrat is elected president in 2020, they would make combating climate change a defining priority of their administration. Therefore, a clearer understanding of the specific approach that would underpin the climate diplomacy of a new Democratic president can provide greater reassurance to the international community as countries consider their own levels of ambition in the lead-up to COP26 and beyond.
Topic:: Climate Change, Diplomacy, Carbon Emissions, COVID-19, and Joe Biden
Political Geography:: China and United States of America

285. China’s Response to Climate Change: A Study in Contrasts and a Policy at a Crossroads

Author:: David B. Sandalow
Publication Date:: 07-2020
Content Type:: Working Paper
Institution:: Asia Society
Abstract:: China is the world’s leading emitter of heat-trapping gases, by far. In 2019, Chinese emissions were greater than emissions from the United States, the European Union, and Japan combined. There is no solution to climate change without China. China’s response to climate change is a study in contrasts. China leads the world in solar power, wind power, and electric vehicle deployment, but also in coal consumption. The Chinese government has adopted some of the world’s most ambitious energy efficiency and forest conservation policies, but is financing a significant expansion of coal-fired power plant capacity at home and abroad. China’s leaders are strongly committed to the Paris Agreement, but appear to attach less priority to climate change than in years past. This Issue Paper explores these contrasts. It does so at an important time in Chinese climate change policy. During the next 18 months, the Chinese government will spend heavily on economic stimulus measures, release its 14th Five-Year Plan (for 2021–2025), and develop short- and long-term climate action plans (known as its “updated nationally-determined contributions” and “mid-century strategy” in the terminology of the global U.N. climate process). Decisions by the Chinese government will reverberate globally, including in the United States. A Biden administration’s ambition in addressing climate change would be reinforced by ambition in China. This Issue Paper provides an up-to-date snapshot of China’s climate policies, drawing on data from 2019 and the beginning of 2020 (during the height of the COVID-19 economic lockdown), as well as recent remarks by Chinese leaders. It starts by examining Chinese emissions of heat-trapping gases. It then discusses China’s principal climate policies, explaining the main tools the Chinese government uses to address climate change and related topics. The Issue Paper concludes with a discussion of processes that will shape Chinese climate change policy in the years ahead.
Topic:: Climate Change, European Union, Economy, and Carbon Emissions
Political Geography:: Japan, China, Europe, Asia, and United States of America

286. China's Pandemic Diplomacy

Author:: Denny Roy
Publication Date:: 09-2020
Content Type:: Working Paper
Institution:: East-West Center
Abstract:: The COVID-19 pandemic threatened to damage China’s international reputation just as the Chinese government under Xi Jinping was peaking in its promotion of China as a model political system and superior international citizen. Beijing launched a massive diplomatic effort aimed at both foreign governments and foreign societies. The goal was to overcome initial negative publicity and to recast China as an efficient and heroic country in the eyes of international public opinion. The crisis created an opening for China to make gains in its international leadership credentials as the world saw the superpower United States falter. Ultimately, however, Chinese pandemic diplomacy contributed to a net decrease in China’s global prestige, largely because domestic political imperatives motivated behavior that generated international disapproval and distrust for the Chinese Communist Party (CCP) government. This paper summarizes the content of Chinese pandemic diplomacy through the key period of January through May 20201, identifies specific strengths and weaknesses of China’s effort, and briefly assesses its global impact.
Topic:: International Relations, Diplomacy, Pandemic, and COVID-19
Political Geography:: China, Asia, North America, and United States of America

287. Cooperation Between the United States and Pakistan: What is the Future?

Author:: Riaz A. Khokhar
Publication Date:: 01-2020
Content Type:: Working Paper
Institution:: East-West Center
Abstract:: Within the Indo-Pacific region, the United States and Pakistan have sharply divergent strategic objectives. While American objectives have changed over time, focusing in recent years on rivalry with China, Pakistan’s strategic objective has remained constant—to maintain a balance of power with India. Yet Pakistan retains close strategic and economic ties with China, and the United States considers India an important strategic partner. Nevertheless, the two countries have worked together for nearly two decades toward two tactical goals—achieving a political settlement in Afghanistan and eliminating terrorism in South Asia. There is potential for them to cooperate more broadly, for example, increasing direct foreign investment to Pakistan and helping Islamabad balance its relations with the United States and China. Washington’s willingness to expand such cooperation will depend on Pakistan’s cooperation in fighting terrorism in the region.
Topic:: International Cooperation, Terrorism, Power Politics, Foreign Direct Investment, and Geopolitics
Political Geography:: Pakistan, Afghanistan, China, South Asia, India, North America, United States of America, and Indo-Pacific

288. Defending the Maritime Rules-Based Order: Regional Responses to the South China Sea Disputes

Author:: Rebecca Strating
Publication Date:: 01-2020
Content Type:: Working Paper
Institution:: East-West Center
Abstract:: The seas are an increasingly important domain for understanding the balance-of-power dynamics between a rising People’s Republic of China and the United States. Specifically, disputes in the South China Sea have intensified over the past decade. Multifaceted disputes concern overlapping claims to territory and maritime jurisdiction, strategic control over maritime domain, and differences in legal interpretations of freedom of navigation. These disputes have become a highly visible microcosm of a broader contest between a maritime order underpinned by the United Nations Convention on the Law of the Sea (UNCLOS) and challenger conceptions of order that see a bigger role for rising powers in generating new rules and alternative interpretations of existing international law. This issue examines the responses of non-claimant regional states—India, Australia, South Korea, and Japan—to the South China Sea disputes.
Topic:: Foreign Policy, Territorial Disputes, Geopolitics, Maritime, and Jurisdiction
Political Geography:: China, Asia, North America, United States of America, and South China Sea

289. Has U.S. Government Angst over the China Danger Diminished?

Author:: Robert Sutter
Publication Date:: 01-2020
Content Type:: Working Paper
Institution:: East-West Center
Abstract:: The so-called “truce” in the trade war with the signing of the phase one U.S.-China trade agreement on January 15 comes amid indicators that the intense U.S. government consensus pushback against a wide range of perceived challenges posed by China may be subsiding.
Topic:: Government, Bilateral Relations, Economy, and Trade Wars
Political Geography:: China, Asia, North America, and United States of America

290. Taiwan's 2020 Election and Its Implications for the New Southbound Policy

Author:: H. H. Michael Hsiao and Alan H. Yang
Publication Date:: 02-2020
Content Type:: Working Paper
Institution:: East-West Center
Abstract:: The elections in January 2020 marked a new era for Taiwan, clearly demonstrating citizens’ resistance to China. The results showed that incumbent President Tsai Ing-wen, leader of the Democratic Progressive Party (DPP), was re-elected with a landslide victory of 8.17 million votes (57.1%) which is higher than the previous record high of 7.65 million votes obtained by the Kuomintang (KMT) President Ma Ying Jeou in 2008. Michael Hsiao and Alan Yang, Chairman and Executive Director, respectively, of the Taiwan‐Asia Exchange Foundation in Taiwan, explain that “The Taiwanese people firmly defended Taiwan’s sovereignty and cherished democracy through free and open elections.”
Topic:: Foreign Policy, Politics, Sovereignty, Elections, and Democracy
Political Geography:: China, Taiwan, and Asia

291. Taking Stock of United States-Vietnam Relations 45 Years After the Fall of Saigon

Author:: Huong Le Thu
Publication Date:: 06-2020
Content Type:: Working Paper
Institution:: East-West Center
Abstract:: Dr. Huong Le Thu, Senior Analyst at the Australian Strategic Policy Institute, explains that “To many, shared concerns about China are the driving force for Vietnam‐U.S. relations.”
Topic:: Bilateral Relations and Geopolitics
Political Geography:: China, Vietnam, North America, Southeast Asia, and United States of America

292. Mongolia's Response to Increasing U.S.-China-Russia Rivalry in Asia

Author:: Alicia Campi
Publication Date:: 08-2020
Content Type:: Working Paper
Institution:: East-West Center
Abstract:: Dr Alicia Campi, President of the Mongolia Society, explains that “The [“Third Neighbor”] policy was reinterpreted in content and meaning to include cultural and economic partners as diverse as India, Brazil, Kuwait, Turkey, Vietnam, and Iran. With increased superpower rivalry in its region, Mongolia has expanded this basic policy.”
Topic:: Foreign Policy, Partnerships, and Economy
Political Geography:: Russia, China, Turkey, India, Mongolia, Asia, Kuwait, Brazil, North America, and United States of America

293. Implications of the Proposed China-Iran deal for India

Author:: Sruthi V.S.
Publication Date:: 08-2020
Content Type:: Working Paper
Institution:: Council on International Policy (CIP)
Abstract:: The ambitious $400 billion deal between China and Iran has garnered worldwide attention. The 18-page draft proposal says that China will facilitate the infusion of about $280 billion to Iran. This major economic and security partnership between China and Iran has raised India’s concerns against the backdrop of its ongoing border conflict with China. According to the New York Times report, the proposed China-Iran deal talks about expanding China’s presence in Iran’s “banking, telecommunications, ports, railways and dozens of other projects”, and in return China will receive a steady supply of oil from Iran for the next 25 years at a discounted price. There are more than 100 projects listed in the draft that will see Chinese investments; these include building Free Trade Zones and several very significant ports. The Chinese will also help Iran build infrastructure for 5G networks and come up with an internet filter like the Great Firewall in China. The stronghold of China in Iran could also result in undermining US policy in the Middle East.
Topic:: International Relations, Diplomacy, International Trade and Finance, and Conflict
Political Geography:: China, Iran, Middle East, India, and Asia

294. Prospects for India-Taiwan Relations

Author:: Niranjan Jose
Publication Date:: 08-2020
Content Type:: Working Paper
Institution:: Council on International Policy (CIP)
Abstract:: This year’s border stand-off in the Galwan Valley between China and India following China’s encroachment into Indian territory, is a reminder of India’s perennial problems with Beijing. The latest violation is an example of the staunch stance China has adopted against India. Neither nation is interested in a full-fledged confrontation. In this scenario, New Delhi has no option but to engage with Beijing to resolve the dispute through dialogue; however discussion and confidence-building initiatives by itself will not lead India towards problem-solving. China’s confrontational approach towards India and the border disagreement set the right background as to why it could not be a better opportunity for India to meaningfully engage with Taiwan. India and Taiwan both are Asian democracies pursuing an effective resolution of dynamic social and ethnic problems, and both face aggressive Chinese security policies aimed at establishing regional hegemony. From a strategic security perspective, both India and Taiwan are deeply concerned about the rising assertiveness of Beijing in the region. The China element can become a tool for moving closer to the strategic communities in New Delhi and Taipei. India and Taiwan have a variety of mutual concerns, ranging from controlling China’s growth to a political and economic partnership. For Taiwan, China’s current trade war with the US has made several Taiwanese firms keen to reduce their vulnerability on China. Indian government initiatives such as Smart Cities, Make in India, Digital India, and Start-up India were launched to increase India’s viability for foreign investors, making it an attractive destination for Taiwanese corporations.
Topic:: International Relations, Foreign Policy, Diplomacy, and Regional Cooperation
Political Geography:: China, India, Taiwan, and Asia

295. 11th U.S.-China High-Level Political Party Leaders Dialogue

Author:: Joshua Cavanaugh
Publication Date:: 06-2020
Content Type:: Working Paper
Institution:: EastWest Institute
Abstract:: A select delegation of leaders from the U.S. Democratic and Republican Parties and the global business community traveled to Beijing, China to meet with senior officials from the Communist Party of China (CPC) on November 18-21, 2019. The discussions were part of the 11th U.S.-China High-Level Political Party Leaders Dialogue organized by the EastWest Institute (EWI) in partnership with the International Department of the Central Committee of the Communist Party of China (IDCPC). Launched in 2010, the U.S.-China High-Level Political Party Leaders Dialogue seeks to build understanding and trust between political elites from the U.S. and China through candid exchanges of views on topics ranging from local governance to foreign policy concerns. The dialogue process consistently involves sitting officers from the CPC and the U.S. Democratic and Republican National Committees. In the 11th iteration of the dialogue, the CPC delegation was led by Song Tao, minister of IDCPC. Gary Locke, former secretary of the United States Department of Commerce, former governor for the state of Washington and former United States Ambassador of China; and Alphonso Jackson, former secretary of the United States Department of Housing and Urban Development; lead the U.S. Democratic and Republican delegations, respectively. Throughout the dialogue, members of both delegations spoke freely on relevant topics including foriegn policy trends, trade disputes and emerging areas of economic cooperation. EWI facilitated a series of meetings for the U.S. delegation, which included a productive meeting with Wang Qishan, vice president of the People’s Republic of China at the Great Hall of the People. The delegates also met with Yang Jiechi, director of the Office of the Central Commission for Foreign Affairs; Dai Bingguo, former state councilor of the People’s Republic of China; and Lu Kang, director of the Department of North American and Oceanian Affairs at the Ministry of Foreign Affairs. The U.S. delegates visited the Asian Infrastructure Investment Bank and met with their president, Jin Liqun, as well as the Schwarzman College at Tsinghua University to engage prominent scholars on the future of the U.S.-China relationship.
Topic:: Foreign Policy, Diplomacy, International Trade and Finance, and Economic Cooperation
Political Geography:: United States, China, Asia, and North America

296. A space exploration industry for India

Author:: Chaitanya Giri
Publication Date:: 05-2020
Content Type:: Working Paper
Institution:: Gateway House: Indian Council on Global Relations
Abstract:: On 16 May, the government introduced a huge reform that liberalised India's space sector, leveling the field and propelling the space ambitions of private players. Corporations such as L&T and Godrej Aerospace, can now compete and collaborate with the Indian Space Research Organisation, to build an indigenous Boeing or Lockheed Martin, and be part of global, private, space industry syndicates. The timing is significant, as the space race has accelerated with the U.S. and China marking their space territories through Accords and SEZs. India now is much better equipped to launch its space agenda. This paper analyses India's future potential.
Topic:: Space, Private Sector, and Industry
Political Geography:: China, South Asia, India, Asia, North America, and United States of America

297. China after the pandemic: Insecurity spills over to contradictory foreign policy actions

Author:: Jyrki Kallio
Publication Date:: 03-2020
Content Type:: Working Paper
Institution:: Finnish Institute of International Affairs
Abstract:: China has garnered international goodwill by aiding countries hardest hit by the Covid-19 pandemic. China is in a position to show that it takes its ideal of creating a global community with a shared future seriously. However, the country’s other actions undermine its soft-power dissemination efforts.
Topic:: International Cooperation, Public Health, Pandemic, and COVID-19
Political Geography:: China and Asia

298. Coming out and breaking out: The US, Iran and Europe go nuclear

Author:: Erwin van Veen
Publication Date:: 10-2020
Content Type:: Working Paper
Institution:: Clingendael Netherlands Institute of International Relations
Abstract:: On the eve of the US elections, the nuclear deal (JCPOA) stands on the edge of the precipice. The US strategy of ‘maximum pressure’ has not (yet) achieved its implicit objective of 'regime change' but tanked Iran’s economy, caused its government to dig in and increased regional instability. The geopolitical consequences of US sanctions, EU prevarication and Iran’s deep presence throughout the Middle East have been equally profound. At the global level, they include nudging Iran towards China/Russia, the US alienating its European ‘partners’ and encouraging them to develop greater strategic autonomy. At the regional level, US sanctions risk creating an alternative economic regional order, ensuring Yemen remains a protracted war and making a regional security initiative more necessary, but less likely. It is not yet too late to turn the tide. The focus should now be on reducing regional tensions and especially the stress that sanctions have put on Iran’s population and government. Radical action looks more inviting when one stands against the wall, but the Middle East does not need more conflict than it already has. To do so, the EU should first support Iran with a large-scale Covid-19 humanitarian economy recovery package. As such measures are already sanctions-exempt, they will create few new tensions. An economic initiative should follow that grants preferential access to the EU’s internal market for industrial and agricultural goods from the entire Middle East (for Iran via an upgraded INSTEX). Such interventions will not resolve existing security dilemmas but can show there is an alternative to confrontation.
Topic:: Treaties and Agreements, Sanctions, Nuclear Power, Elections, and European Union
Political Geography:: Russia, China, Europe, Iran, Yemen, and United States of America

299. China’s Strategic Objectives in a Post-COVID-19 World

Author:: Benjamin Tze Ern Ho
Publication Date:: 10-2020
Content Type:: Working Paper
Institution:: Institute for National Strategic Studies (INSS), National Defense University
Abstract:: On 1 October 2019, the People’s Republic of China (PRC) celebrated its 70th birthday, thus marking another important landmark of modern China under the leadership of the Chinese Communist Party (CCP). In commemorating the event, the Chinese government held a grand military parade with some 15,000 troops, more than 160 aircraft, and 580 active weapon systems during the event, including the latest generation nuclear missile systems such as the Dongfeng-41 mobile intercontinental ballistic missile. As the South China Morning Post reported, citing one insider, “the parade, which aims to showcase President Xi’s achievement in military modernization and reforms in both hardware and software will carry a lot of political meaning.” Given ongoing social protests in Hong Kong and problems in western societies at that time (such as Brexit talks in the UK and political opposition to President Trump in the United States) the contrast could not have been more stark: A powerful and prosperous China celebrates its international success while many western societies fail and flounder amidst their own domestic problems.
Topic:: Hegemony, Public Health, Strategic Competition, Pandemic, COVID-19, and Strategic Interests
Political Geography:: China and Asia

300. Dealing with China: Lessons Learned from Three Case Studies

Author:: Christopher W. Bishop
Publication Date:: 09-2020
Content Type:: Working Paper
Institution:: Canadian Global Affairs Institute (CGAI)
Abstract:: The idea for this paper began after several conversations with Canadian friends and colleagues about the cases of Michael Kovrig and Michael Spavor. On December 10, 2018, Chinese officials detained the two Canadian citizens for “endangering state security”, 10 days after Canadian authorities arrested Meng Wanzhou, Huawei’s chief financial officer, on an extradition warrant from the United States, where she was wanted for bank fraud. Despite Chinese statements denying any connection between the two Michaels and Meng, some Canadians have argued the only way to gain their release is for Canada to release Meng – a classic “prisoner exchange”. Others, however, have argued just as forcefully that trading Meng for the two Canadians would only give legitimacy to China’s “hostage diplomacy”. One friend asked me if China had ever done anything like this before. How had those cases been resolved, and what would China do this time? Those were good questions. As a U.S. Foreign Service officer who has spent much of my career working on China – including at the U.S. embassy in Beijing from 2015-2018, where I analyzed the Communist Party leadership and China’s state security apparatus – I had some insight into Chinese foreign policy. I also had a personal connection to one of the cases. I knew Michael Kovrig – he had been one of my counterparts at the Canadian embassy in Beijing – and I had great respect for his work as a diplomat, and later as a senior advisor at the International Crisis Group. Moreover, because I was now on leave from the U.S. Department of State to serve as a Council on Foreign Relations International Affairs Fellow in Canada, I had time to look for some answers. And so I began trying to identify and analyze similar cases from the recent past. This paper is the result. It represents my own views, and although the Department of State has allowed me to publish it in my personal capacity, it does not necessarily reflect the views of the Department or the U.S. government.
Topic:: Foreign Policy, Diplomacy, International Affairs, Prisons/Penal Systems, and Finance
Political Geography:: China, Canada, Asia, North America, and United States of America

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