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1321. The US–China trade war and phase one agreement

Author:
Chad P. Bown
Publication Date:
02-2021
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
The Trump administration changed US trade policy toward China in ways that will take years for researchers to sort out. This paper makes four specific contributions to that research agenda. First, it carefully marks the timing, definitions, and scale of the products subject to the tariff changes affecting US-China trade from January 20, 2017 through January 20, 2021. One result is that each country increased its average duty on imports from the other to rates of roughly 20 percent, with the new tariffs and counter-tariffs covering more than 50 percent of bilateral trade. Second, the paper highlights two additional channels through which bilateral tariffs changed during this period: product exclusions from tariffs and trade remedy policies of antidumping and countervailing duties. These two channels have received less research attention. Third, it explores why China fell more than 40 percent short of meeting the goods purchase commitments set out for 2020, the first year of the phase one agreement. Finally, the paper considers additional trade policy actions—involving forced labor, export controls for reasons of national security or human rights, and reclassification of trade with Hong Kong—likely to affect US-China trade beyond the Trump administration.
Topic:
Education, Trade Wars, Trade Policy, and Protectionism
Political Geography:
China, Asia, North America, and United States of America

1322. How China lends: A rare look into 100 debt contracts with foreign governments

Author:
Anna Gelpern, Sebastian Horn, Scott Morris, Brad Parks, and Christoph Trebesch
Publication Date:
05-2021
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
China is the world’s largest official creditor, but basic facts are lacking about the terms and conditions of its lending. Very few contracts between Chinese lenders and their government borrowers have ever been published or studied. This paper is the first systematic analysis of the legal terms of China’s foreign lending. The authors collect and analyze 100 contracts between Chinese state-owned entities and government borrowers in 24 developing countries in Africa, Asia, Eastern Europe, Latin America, and Oceania, and compare them with those of other bilateral, multilateral, and commercial creditors. Three main insights emerge. First, the Chinese contracts contain unusual confidentiality clauses that bar borrowers from revealing the terms or even the existence of the debt. Second, Chinese lenders seek advantage over other creditors, using collateral arrangements such as lender-controlled revenue accounts and promises to keep the debt out of collective restructuring (“no Paris Club” clauses). Third, cancellation, acceleration, and stabilization clauses in Chinese contracts potentially allow the lenders to influence debtors’ domestic and foreign policies. Even if these terms were unenforceable in court, the mix of confidentiality, seniority, and policy influence could limit the sovereign debtor’s crisis management options and complicate debt renegotiation. Overall, the contracts use creative design to manage credit risks and overcome enforcement hurdles, presenting China as a muscular and commercially savvy lender to the developing world.
Topic:
Foreign Policy, Debt, Government, and Banking
Political Geography:
China and Asia

1323. Raising a caution flag on US financial sanctions against China

Author:
Jeffrey J. Schott
Publication Date:
01-2021
Content Type:
Policy Brief
Institution:
Peterson Institute for International Economics
Abstract:
China’s policies in Xinjiang, Hong Kong, and the South China Sea and its ongoing support for Iran, North Korea, and Venezuela pose major challenges for the United States, where bipartisan pressure is growing to ramp up punitive sanctions against leading Chinese firms and financial institutions. Financial sanctions freeze the US assets or bar US entry of the targeted individuals and firms and prohibit US financial firms from doing business with them. Schott explains why US officials should carefully weigh the risks to international financial markets and US economic interests before imposing punitive sanctions on major financial institutions engaged with China. The collateral costs of such sanctions would be sizable, damaging US producers, financial institutions, and US alliances. By restricting access of major banks to international payments in US dollars and barring use of messaging systems like SWIFT, tougher US financial sanctions would effectively “weaponize” the dollar; friends and foes alike would be pushed to seek alternatives to dollar transactions that, over time, would weaken the international role of the dollar. Instead of doubling down on current unilateral financial sanctions, US policy should deploy sanctions in collaboration with allies and calibrate trade and financial controls to match the expected policy achievements.
Topic:
Human Rights, Sanctions, Finance, and Economy
Political Geography:
China, Asia, North America, and United States of America

1324. The unappreciated trend toward unilateral trade liberalization

Author:
Robert Z. Lawrence
Publication Date:
03-2021
Content Type:
Policy Brief
Institution:
Peterson Institute for International Economics
Abstract:
Afrequently voiced complaint from the Trump administration was that US firms have faced a competitive disadvantage in exports because the US market is open and US tariffs are low but US trading partners protect their markets with high tariffs. The administration used this concern to justify raising US tariffs whenever it could. Lawrence argues that these claims should be more nuanced and account for the extensive unilateral liberalization by many countries over the past 30 years and that the grievances that motivated the Trump trade policies are increasingly misplaced. Many developing countries have reduced their tariffs unilaterally to rates that are far lower than they applied three decades ago and far less than the bound rates reflected in their World Trade Organization (WTO) obligations. Globally, on average, tariffs were not raised during the global financial crisis of 2008 and continued to decline through at least 2018. Even when shocks from imports resulted in serious injury to domestic industries, several developing countries temporarily provided safeguard protection but at levels that were lower than their WTO bound rates. This evidence of import liberalization also suggests that rising protectionism was not responsible for the slow growth in world trade that has been evident since 2011. It remains uncertain whether countries will now respond to disruptions to global supply chains since 2018 caused by Trump’s trade policies and the COVID-19 pandemic by reversing their tariff liberalization stance, but the sustained enthusiasm for new megaregional trade agreements suggests many countries will not.
Topic:
Emerging Markets, World Trade Organization, Trade Wars, and Protectionism
Political Geography:
China, Asia, North America, and United States of America

1325. Improving China's participation in resolving developing-country debt problems

Author:
Martin Chorzempa and Adnan Mazarei
Publication Date:
05-2021
Content Type:
Policy Brief
Institution:
Peterson Institute for International Economics
Abstract:
The COVID-19 shock has exacerbated the struggles of many emerging-market and developing economies (EMDEs) to repay their external debt. One of the most urgent challenges relates to debt owed to China, whose lending spree under its Belt and Road Initiative and other programs has played an outsized role in what amounts to a crisis for many countries. The scope of the problem is striking. China is owed more than $100 billion, or 57 percent of all debt owed to official creditors by the countries that need help the most. China is not a member of the Paris Club of official creditors, which coordinates, within a multilateral framework, the resolution of general sovereign illiquidity or unsustainable external debt of EMDEs. There is an urgent need to put in place more effective, long-term solutions to help durably lower the risks of prolonged debt difficulties in EMDEs. These problems could be partly addressed by creating creditor committees to coordinate debt relief with China. The Group of Twenty (G20) has taken some steps to include creditor committees in the context of the Common Framework for Debt Treatments beyond the Debt Service Suspension Initiative (DSSI), but only for low-income countries that qualify for the DSSI and only for official creditors. To better address debt distress, it needs to extend the approach, especially to middle-income debtor countries.
Topic:
Debt, Development, Emerging Markets, and G20
Political Geography:
China and Asia

1326. U.S. Economic Challenges for the Biden Administration

Author:
Paweł Markiewicz
Publication Date:
06-2021
Content Type:
Special Report
Institution:
The Polish Institute of International Affairs
Abstract:
The U.S. economy is emerging from the recession caused by the COVID-19 pandemic. To maintain growth and at the same time achieve climate and technology goals, the Biden administration is pushing large socio-economic programmes. To pass them in Congress, the administration will be forced to reach compromises with factions within the Democratic Party. Biden also will need some Republican support. In foreign policy, these programmes aim to strengthen the U.S. position in its rivalry with China, something that also opens greater possibilities for closer cooperation with the EU.
Topic:
Economics, Politics, COVID-19, and Joe Biden
Political Geography:
China, North America, and United States of America

1327. A Vision of the Future: The U.S. Intelligence Report “Global Trends 2040”

Author:
Marcin Andrzej Piotrowski
Publication Date:
06-2021
Content Type:
Special Report
Institution:
The Polish Institute of International Affairs
Abstract:
In April 2021, the U.S. intelligence community published the extensive report “Global Trends 2040: A More Contested World”. It analyses the main demographic, political, and strategic trends that will likely shape the world for the next two decades. The report will be intensively used by the Biden administration in the preparation of the new U.S. National Security Strategy and National Defense Strategy, as well as in new military doctrines. The “Global Trends” document reflects the main tendencies in American strategic thinking, such as the growing “Sinocentrism” and traditional U.S. attachment to transatlantic relations.
Topic:
Foreign Policy, Climate Change, Intelligence, and Strategic Planning
Political Geography:
China and United States of America

1328. Developments in U.S. Defence Spending: Implications for NATO

Author:
Artur Kacprzyk
Publication Date:
04-2021
Content Type:
Special Report
Institution:
The Polish Institute of International Affairs
Abstract:
After a few years of increases, U.S. defence spending is likely to stagnate. At the same time, the needs related to the U.S. priority of deterring China will grow. The effect will be that the U.S. will continue to call for a greater contribution of NATO members to their own defence, even given the softening of transatlantic tensions and positive signals regarding the U.S. military presence in Europe.
Topic:
Defense Policy, NATO, Military Spending, and Deterrence
Political Geography:
China, North America, and United States of America

1329. The Impact of the Repression in Xinjiang on China’s Relations with Other Countries

Author:
Marcin Przychodniak
Publication Date:
04-2021
Content Type:
Special Report
Institution:
The Polish Institute of International Affairs
Abstract:
The policy of repression of Uyghurs in Xinjiang has become a significant element of criticism of China in the world. In March this year, the EU, U.S., Canada, and the United Kingdom imposed sanctions on China over the matter. Moreover, the Netherlands, the U.S. and Canada described China’s actions as genocide. For China, however, its actions involving Uyghurs are a key element of domestic politics, which is why it presents accusations as disinformation. It has imposed counter sanctions, including on the EU, and their wide scope indicates that for China, Xinjiang is more important than, for example, the ratification of the Comprehensive Investment Agreement (CAI) with the EU.
Topic:
International Relations, Genocide, Human Rights, European Union, and Uyghurs
Political Geography:
China, United Kingdom, Europe, Canada, Asia, Netherlands, United States of America, and Xinjiang

1330. A Crash Test: EU Strategic Autonomy in the Foreign Policy of France

Author:
Łukasz Maślanka
Publication Date:
03-2021
Content Type:
Special Report
Institution:
The Polish Institute of International Affairs
Abstract:
France uses the idea of EU strategic autonomy as a tool in its own foreign policy. France’s aim is to redefine the Union’s partnership with the U.S. and NATO. Hence, the activity of President Emmanuel Macron in emphasising the differences between the positions of the U.S. and the EU, especially in relations with China and Russia. Macron’s rhetoric worries other European countries and hides the real problems in EU security policy, such as insufficient financing of the Common Security and Defence Policy as well as the lack of a clear definition of strategic autonomy.
Topic:
Security, Foreign Policy, European Union, and Strategic Autonomy
Political Geography:
Russia, China, Europe, France, and United States of America

1331. NATO on the Road to a New Strategy

Author:
Wojciech Lorenz
Publication Date:
01-2021
Content Type:
Special Report
Institution:
The Polish Institute of International Affairs
Abstract:
During the meeting of NATO foreign ministers on 2–3 December 2020, a group of experts presented the report “NATO 2030. United for a New Era” about strengthening the political dimension and consultation mechanisms of the Alliance. The report indicates a possible consensus on the expansion of the Alliance’s tasks, including on a common policy towards China. The document increases the chances that the allies will decide to start work on a new NATO strategy.
Topic:
Foreign Policy, NATO, Military Strategy, Alliance, and Strategic Interests
Political Geography:
China, Europe, and United States of America

1332. Framing Violence: US and Chinese State-Funded News Outlets during the Hong Kong Protests

Author:
Hanmin Kim
Publication Date:
06-2021
Content Type:
Special Report
Institution:
Pacific Forum
Abstract:
State-funded news media outlets and the ways in which they convey the messages of government and government-affiliated officials represent an essential but under-emphasized area of study in the realm of international diplomacy. Through a case study of the Hong Kong protests of 2019, this paper draws on theories from journalism and public diplomacy to analyze articles by state-funded media covering the unrest. This paper argues that the state-funded news outlets of the US and China used the same frame—violence and conflict—but approached the Hong Kong protests differently. Using this frame, state media outlets made themselves channels for government officials during the US-China rivalry, but made different arguments regarding the violence that occurred there. While US government-funded media focused on the violence of the Hong Kong Police Force as a danger to the territory’s democracy, Chinese state media emphasized the violence of the Hong Kong protestors as a danger to national security.
Topic:
Government, Communications, Media, Protests, and Journalism
Political Geography:
United States, China, and Hong Kong

1333. The Vision Group on U.S.-ROK Relations: Insights and Recommendations

Author:
KEI
Publication Date:
01-2021
Content Type:
Working Paper
Institution:
Korea Economic Institute of America (KEI)
Abstract:
The Korea Economic Institute of America (KEI), with the generous support of the Korea Foundation, organized six “Vision Group” roundtable conversations with leading American scholars and commentators to discuss the United States’ relationship with the Republic of Korea. The first was held in December 2019, the last in November 2020. The intent was to consider the future of relations during a time of change. The Vision Group comprised a wide range of expertise and opinion. This record conveys some of the insights and recommendations that arose during the conversations.
Topic:
International Relations, Security, Foreign Policy, Economics, and Human Rights
Political Geography:
China, Asia, South Korea, North Korea, and United States of America

1334. Limits of Public Diplomacy and Soft Power: Lessons from the THAAD Dispute for South Korea's Foreign Policy

Author:
Maximilian Ernst
Publication Date:
04-2021
Content Type:
Working Paper
Institution:
Korea Economic Institute of America (KEI)
Abstract:
This paper examines South Korea’s foreign policy towards China before, during, and after the Terminal High Altitude Area Defense (THAAD) missile defense dispute to investigate the limits of South Korea’s public diplomacy and soft power. South Korea’s official public diplomacy has the objective to “gain global support for Korea’s policies,” following Joseph Nye’s narrow definition of soft power. South Korea furthermore ranks high in the most relevant soft power indices. Based on the case of Chinese economic retaliation against South Korea in response to THAAD deployment, this paper argues that public diplomacy and soft power only work in the absence of traditional security contentions, but fail in the presence of such security contentions. The THAAD case also demonstrates the utility of traditional diplomacy, based on high-level summits and negotiations, to solve the very disputes that South Korea’s latent public diplomacy and soft power were unable to alleviate.
Topic:
International Relations, Foreign Policy, Diplomacy, Economics, and Weapons
Political Geography:
China, Asia, South Korea, and Korea

1335. The changing nature of work and earnings inequality in China

Author:
Chunbing Xing
Publication Date:
06-2021
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper examines the evolution of China’s industrial and occupational structure in the last two decades and its impact on wage inequality. We find that non-routine cognitive and interpersonal tasks have increased, while routine cognitive tasks first increased and then declined. Occupation structural change is accompanying rising wage inequality. The wage premium for educated workers rose sharply in the 1990s and remained high thereafter. Occupations with high routine task intensity are associated with lower wages. While the return to education has become the largest contributor to wage inequality, routine task intensities have yet to play a significant role.
Topic:
Education, Labor Issues, Employment, Inequality, and Work Culture
Political Geography:
China and Asia

1336. The Silence of non-Western International Relations Theory as a Camouflage Strategy: The Trauma of Qing China and the Late Ottoman Empire

Author:
Hayriye Asena Demirer
Publication Date:
01-2021
Content Type:
Journal Article
Journal:
All Azimuth: A Journal of Foreign Policy and Peace
Institution:
Center for Foreign Policy and Peace Research
Abstract:
My main argument in this article is that there have been at least three important barriers to the development of non-Western international relations theory (NWIRT): intellectual barriers (traumatizing effects of the imposition of the “standard of civilization”); ideational barriers (dominance of Western concepts and contexts); and scientific barriers (imposition of the standard of science). I argue that the silence of NWIRT is substantially a side effect of the strategy of mimicking the West, which was developed as an intellectual defense mechanism or as a camouflage strategy for the (re)establishment and the survival of non-Western states after their traumatic encounter with the Western states. Therefore, the surfacing of NWIRT discussions in the last decades can be attributed primarily to the maturation of an internal condition that is the revival of self-confidence in the residuals of former empires due to their regaining of rising power status and, thus, can be seen as a new phase of the ‘revolt against the West.’ On the other hand, I argue that the rise of NWIRT discussions are also related to the ripening of an external condition: some European schools of IR have been attempting to intellectually balance against the hegemony of American mainstream IRT, therefore, publication of edited books and special issues on NWIRT can also be read as searching for intellectual alliance with NWIRT.
Topic:
International Relations, Trauma, Civilization, and Ottoman Empire
Political Geography:
China, Turkey, Middle East, and Asia

1337. The challenge to US hegemony and the “Gilpin Dilemma”

Author:
Giorgio Romano Schutte
Publication Date:
04-2021
Content Type:
Journal Article
Journal:
Revista Brasileira de Política Internacional (RBPI)
Institution:
Instituto Brasileiro de Relações Internacionais (IBRI)
Abstract:
This article makes a comparison between the challenges faced by the US to maintain its hegemonic position at the end of the 1970s and in the 2010s. To do so we review Robert Gilpin’s writing during the first period. He suggested the US had three options: 1) a defensive protectionist reaction 2) fragmentation of the international system 3) a new wave of innovation, (“rejuvenation”). It is argued that the Reagan administration was able to establish support for the third option. We argue the US is now faced with the same dilemma again, but with a different kind of challenger: China.
Topic:
Foreign Direct Investment, Hegemony, Conflict, and Innovation
Political Geography:
China, Asia, North America, and United States of America

1338. Understanding Hypersonic Weapons: Managing the Allure and the Risks

Author:
Shannon Bugos and Kingston Reif
Publication Date:
09-2021
Content Type:
Special Report
Institution:
Arms Control Association
Abstract:
RESEARCH & REPORTS The debate concerning hypersonic weapons has gained increased attention in recent years as the United States has poured billions of dollars—and plans to pour billions more—into accelerating the development of hypersonic weapons and as China and Russia make headway in developing and deploying their own such weapons. The Pentagon is funding no less than eight prototype hypersonic weapons programs with the aim of fielding an initial capability of at least some of those by 2022. The U.S. rush to field hypersonic weapons merits a more critical examination by the Biden administration and Congress given the many unanswered questions about their rationale, technical viability, cost-effectiveness, and escalatory risks. It is past time for Congress to demand these answers before the military begins fielding the weapons in great numbers. This new report outlines the scope of the unanswered questions about the case for hypersonic weapons, details the underappreciated risks to stability posed by the weapons, assesses the viability of arms control as a tool to reduce these risks, and suggests recommended action items for Congress to better its understanding about the Pentagon’s plans for the weapons, eliminate potential redundancies in weapons capabilities, and mitigate stability risks.
Topic:
Arms Control and Proliferation, Nuclear Weapons, and Hypersonic Weapons
Political Geography:
Russia, China, and United States of America

1339. Climate Politics and the Crisis of the Liberal International Order

Author:
Felipe Leal Albuquerque
Publication Date:
08-2021
Content Type:
Journal Article
Journal:
Contexto Internacional
Institution:
Institute of International Relations, Pontifical Catholic University of Rio de Janeiro
Abstract:
The election of Donald Trump brought disarray to the climate change regime. The changes in what was up to then a promoter of the liberal international order (LIO) exacerbated existing tensions while creating new ones. This paper investigates how that challenge impacted the behaviours of Brazil, China and the European Union (EU) by comparatively analysing their dissimilar positions with respect to three indicators before and after Trump’s coming into power. These indicators are individual pledges and climate-related policies; approaches to climate finance; and the principle of common but differentiated responsibilities and respective capabilities (CBDR-RC). The analysis first shows how the US started eroding the broader LIO and the climate change regime to then delve into the behaviours of the three respective key players concerning climate talks. I sustain that the EU, despite its inner divisions, is already counteracting Washington, whereas China is combining a pro-status quo position based on a rhetorical condemnation of the United States. Brazil, in turn, had a transition towards a climate-sceptic government, shifting from being a cooperative actor to abdicating hosting the COP25.
Topic:
Climate Change, Environment, Liberal Order, Multilateralism, and International Order
Political Geography:
China, Asia, Brazil, South America, North America, and United States of America

1340. China in UN Peacekeeping Operations: A 30-Year Assessment (1990-2019)

Author:
Renan Holanda Montenegro
Publication Date:
08-2021
Content Type:
Journal Article
Institution:
Institute of International Relations, Pontifical Catholic University of Rio de Janeiro
Abstract:
This article presents a broad assessment of Chinese personnel deployments to peacekeeping operations (PKOs) for the past three decades (1990-2019). To this end, an original dataset was built with data collected from the UN Department of Peace Operations. The following four indicators were considered in the analysis: (i) total personnel contribution per year; (ii) personnel contribution per mission; (iii) personnel contribution in relation to the mission’s total contingent; and (iv) personnel in a given mission in relation to the total personnel dispatched by China that year. Generally speaking, UN missions in Liberia (UNMIL) and South Sudan (UNMISS) have been the main destinations of Chinese peacekeepers in the 21st Century, while Cambodia (UNTAC) was by far the only place where China got deeply involved during the 1990s. In addition to displaying descriptive data, the paper also briefly analyses Chinese engagement in these operations.
Topic:
International Cooperation, United Nations, Peacekeeping, and Peace
Political Geography:
China, Asia, and Global Focus