[Parag Khanna, The Future is Asian. Simon & Schuster. New York, 2019. 433 p.]
review / Emili J. Blasco
Parag Khanna's book can be greeted with suspicion from entrance because of the apparent axiomatic character of his degree scroll. However, the blunt assertion on the cover is softened when one begins to read the pages inside. The thesis of the work is that the world is in a process of asianisationnot of chinisationMoreover, this process is presented as another coat of paint on the planet, not as a colour that will be clearly predominant or definitive.
It is possible that the discussion over whether the US is in decline and will be replaced by China as the pre-eminent superpower obscures other parallel developments. Those watching Beijing's rise in the world order, writes Khanna, "have often been paralysed by two views: either China will devour the world or it is on the verge of collapse. Neither is correct. "The future is Asian, even for China," he asserts.
Khanna believes that the world is moving towards a multipolar order, which is also the case in Asia, even if China's size often dazzles.
The author's Indian background and also his time living in the United States may have influenced this judgement, but he offers figures to support his words. Of the 5 billion people living in Asia, 3.5 billion are non-Chinese (70%): China thus has only a third of Asia's population; it also accounts for slightly less than half of Asia's GDP. Other data: half of outward investment from the continent is non-Chinese, and more than half of outward investment goes to Asian countries other than China. Asia is therefore "more than China plus".
It is not just a question of size, but of wills. "A China-led Asia is no more acceptable to most Asians than the notion of a US-led West is to Europeans," says Khanna. He rejects the idea that, because of China's power, Asia is heading towards a kind of tributary system like the one ruled in other centuries from Beijing. He points out that such a system did not extend beyond the Far East and was based primarily on trade.
The author reassures those who fear Chinese expansionism: "China has never been an indestructible superpower presiding over all of Asia like a colossus". He warns that while Europe's geographical characteristics have historically led many countries to fear the hegemony of a single power, Asia's geography makes it "inherently multipolar", as natural barriers absorb friction. Indeed, clashes between China and India, China and Vietnam or India and Pakistan have ended in stalemates. "Whereas in Europe wars have occurred when there is a convergence in power between rivals, in Asia wars have occurred when there is a perceived advantage over rivals. So the more powerful China's neighbours like Japan, India or Russia are, the less likely they are to conflict with each other.
For Khanna, Asia will always be a region of distinct and autonomous civilisations, especially now that we are witnessing a revival of old empires. Asia's geopolitical future will not be led by the US or China: "Japan, South Korea, India, Russia, Indonesia, Australia, Iran and Saudi Arabia will never come together under a hegemonic umbrella or unite into a single pole of power".
There will not be, then, a Chineseisation of the world, according to the author, and the Asianisation that is taking place - a shift of the world's weight towards the Indo-Pacific - need not be seen as a threat to those who live elsewhere. Just as there was a Europeanisation of the world in the 19th century, and an Americanisation in the 20th century, we are witnessing an Asianisation in the 21st century. Khanna sees this as "the most recent substratum of sedimentation in the geology of global civilisation", and as a "layer" it does not imply that the world Withdrawal to what came before. "Being more Asian does not necessarily mean being less American or European," he says.
The book analyses the weight and fit of different Asian countries on the continent. Of Russia, he argues that it is strategically closer to China today than at any time since its communist pact in the 1950s. Khanna believes that geography leads to this understanding, as it invites Canada to maintain good relations with the United States; he predicts that climate change will further open up the lands of Siberia, which will integrate them more with the rest of the Asian continent.
As for India and China's relationship, Khanna believes that both countries will have to accept each other as powers more normally. For example, despite India's reluctance towards China's Silk Road and India's own regional connectivity projects, in the end the two countries' preferred corridors will "overlap and even reinforce each other", ensuring that products from inland Asia reach the Indian Ocean. "Geopolitical rivalries will only accelerate the Asianisation of Asia," says Khanna.
In assessing the importance of Asia, the book includes Middle Eastern oil. Technically, the region is part of the continent, but it is such a separate chapter with its own dynamics that it is difficult to see it as Asian territory. The same is true when label is used to refer to Israel or Lebanon. It can give the impression that the author is lumping everything together in order to make the figures more impressive. He argues that the Middle East is becoming less and less dependent on Europe and the United States and is looking more to the East.
Khanna is in a position to reasonably defend himself against most of the objections to his text. Most controversial, however, is his near-defensive justification of technocracy as a system of government. Beyond the descriptive attitude of a model that in some countries has received an important economic and social development , Khanna even seems to endorse its moral superiority.
[John West, Asian Century on A Knife Edge: A 360 Degree Analysis of Asia's Recent Economic Development. Palgrave Macmillan. Singapore, 2018. 329 p.]
REVIEW / Gabriela Pajuelo
The degree scroll of this book seems to contribute to the generalised chorus that the 21st century is Asia's century. In reality, the book's thesis is the opposite, or at least puts this claim "on a knife's edge": Asia is a continent of great economic complexity and competing geopolitical interests, posing a series of challenges whose resolution will determine the region's place in the world in the coming decades. For now, argues John West, a university professor in Tokyo, nothing is certain.
The book begins with a preamble on the recent history of Asia, from the Second World War to the present day. Already at the beginning of this period, economic liberalism was established as the standard doctrine in much of the world, including most Asian countries, in a process driven by the establishment of international institutions.
China joined this system, without renouncing its domestic doctrines, when it joined the World Trade Organisation in 2001. Since then, there have been some shocks such as the financial crisis of 2007-2008, which severely affected the US economy and had repercussions in the rest of the world, or the recent tariff tensions between Washington and Beijing, as well as the current global crisis caused by the coronavirus pandemic.
The principles of protectionism and nationalism deployed by Donald Trump and an increased US resource to the hard power in the region, as well as a more assertive policy by Xi Jinping's China in its geographical surroundings, also resorting to positions of force, such as in the South China Sea, have damaged the multilateralism that had been built up in that part of the world.
The author provides some thought-provoking insights into the challenges that Asia will face, given that the factors core topic that favoured its development have now deteriorated (mainly due to the stability provided by international economic interdependence).
West examines seven challenges. The first is to gain a better position in global value chains, as since the 1980s the manufacture of components and the production of final products has taken place in different parts of the world. Asia is heavily involved in these supply chains, in fields such as technology or apparel production, but is subject to business decisions by multinationals whose practices are sometimes not socially responsible and allow abuse of labour rights, which are important for the middle classes development .
The second challenge is to maximise the potential of urbanisation, which has grown from 27% of the population in 1980 to 48% in 2015. The region is known for its densely populated mega-cities. This brings with it some challenges: people migrating to industrial centres generally move from leave productivity jobs to high productivity jobs, and health care capacity is put at test . But it is also an opportunity to improve environmental practices or encourage innovation through green technologies, even though much of Asia today still faces high levels of pollution.
Another challenge is to give all Asians equal opportunities in their respective societies, from LGBT people to women and indigenous communities, as well as ethnic and religious minorities. The region also faces a major demographic challenge , as many populations either age (such as China's, despite the correction of the "two-child policy") or continue to expand with presumed future supply problems (such as India's).
West also points to reference letter, the barriers to democratisation in the region, with China's notable immobility, and the spread of economic crime and corruption (counterfeiting, piracy, drug trafficking, human trafficking, cybercrime and money laundering).
Finally, the author speaks of challenge that Asian countries can live together in peace and harmony, while China consolidates its position as a regional leader: if there is a Chinese commitment to thesoft powerThrough the Belt and Road initiative, there is also a more confrontational attitude on the part of Beijing towards Taiwan, Hong Kong and the South China Sea, while actors such as India, Japan and North Korea want a greater role.
Overall, the book provides a comprehensive analysis of Asia's economic and social development and the challenges ahead. In addition, the author offers some thought-provoking insights, arguing that the proclaimed "Asian century" is unlikely due to the region's lagging economic development , as most countries have not caught up with their Western counterparts in terms of GDP per capita and technological sophistication. However, it leaves the future open: if the challenges are successfully met, the time may indeed come for an Asian century.
▲ Night view of Shanghai [Pixabay].
COMMENT / Jimena Puga
China's new Foreign Investment Law, which came into force on 1 January 2020, aims to accelerate the country's economic policy reforms to open up the domestic market and remove obstacles and contradictions of the previous law, goal as its main objective. As stated by the President of the People's Republic statement , the new rule aims to build a market based on stability, transparency, predictability and fair skill for foreign investors. Moreover, the Chinese authorities claim that this new law represents a fundamental part of the state's policy to open up to the world and attract more foreign direct investment.
The draft of the rule, drafted in 2015, created high expectations among Chinese reformers and foreign investors for a change in the country's foreign investment policy regime. And its publication in 2019, the year at the end of which the US and PRC presidents agreed to a hiatus in the trade war in which they are both engaged, signalled a breakthrough in this change.
However, the reality is different. Beijing's stance on foreign investment remains significantly different compared to the conception of investment in the international arena, but parts of the reformist sector of society know that the government cannot afford to miss the opportunity for improvement after the gradual slowdown of domestic investment in the Chinese market over the last decade.
On the contrary, and taking into account the image that the Middle Kingdom has sought to project to the world since the opening of the regime, it might be thought that President Xi Jinping and the leaders of the Communist Party would have seized the opportunity to give a facelift to a new policy that, in comparison with the labyrinthine and previous law, would be systematic and perceived in a more friendly way by investor countries, as a means to revive the declining rates of economic progress. The Asian power's new approach to the free market is therefore a smokescreen based on the establishment of protocols that vaguely define the limits of the rights enjoyed by foreign investors.
As a complement to the content of the foreign investment law, the regulation highlights its promotion and protection and details the necessary measures to ensure its effective implementation. It promotes investment by protecting the rights and interests of investors, standardising the administration of foreign investment, improving the environment for business establishments, as well as promoting the advancement of market opening with a broader scope.
Specifically, the precept stipulates that foreign-invested enterprises shall enjoy the same favourable policies as domestic companies. In addition, it details measures to protect business confidentiality and improve the mechanism for presentation of suggestions from foreign firms to the authorities.
It also sets out and clarifies the implementation of a negative listing mechanism for foreign investment access and details the registration and notification system for this subject of investments. Finally, it also regulates the investment policies for companies established in Hong Kong, Macao and Taiwan, and the legal responsibilities for violations of these regulations.
From a strictly legal point of view, article 2 of the precept defines the concept of foreign investment as "the activity of investing directly or indirectly carried out by foreign natural persons, companies or other organisations", and also contemplates four circumstances that are considered part of this investment subject :
Who establishes a business in the territory of China either alone or with another investor
Whoever acquires participations, shares... or other rights and interests of a business in the territory of China
Who invests in any new project in China, either alone or with another investor
Whoever invests in any other manner stipulated by law, administrative regulations or provisions of the State committee
The term "business foreign investment" refers to a business incorporated in Chinese territory under Chinese law and with all or part of its investment financed from a foreign investor.
However, as mentioned above, despite the important innovations of this law, many questions remain unanswered. For example, it does not specify what indirect investment is. Nor does it specify the scope of "foreign natural person": what about Chinese who acquire another nationality, and what about foreigners who acquire Chinese citizenship? Moreover, the legislator also fails to clarify whether investment from Hong Kong, Macao or Taiwan will be considered foreign investment.
Articles 4 and 28 of the new law state that China will adopt the management system of pre-establishment of national treatment (a principle that guarantees foreign investors and their investments access to markets without disadvantages, and thus on the same terms as domestic investors). And the Negative List system for foreign investment, which consists of special administrative measures for foreign investment access to certain fields. In other words, the government will treat all foreign investments outside the Negative List as domestic.
This Negative List system was first tested in the Shanghai SEZ and expanded across the country in 2018. Both article 4 and 28 clarify that the new Negative List will be promulgated prior to agreement of the committee of State. This means that neither ministers nor local governments will be able to place restrictions on foreign investment. What's missing? If investors want access to the sectors restricted under the Negative List, they must receive authorisation from the Ministry of Commerce, a procedure that the legislator does not include in rules and regulations.
On the other hand, Articles 34 and 37 of the new law establish the system of communication on the establishment of new investments for management and their organisation.
From agreement with these points, foreign investors are obliged to communicate all relevant information to the trading department regulated by the business Registration System or the business Credit Information System advertising . Penalties for non-compliance are also set out in these articles. But once again, in this field there is a lack of requirements as to how and what content is required for the communication of information to the department trading system.
This new turn in economic policy translates, once again, into a strategy by which Beijing aims to project itself on the international stage as a powerful and innovative economic power, trying to hide the slowdown in its domestic market and the damage suffered from the trade war against Washington. However, given the loopholes analysed in the aforementioned articles and their vague and ambiguous wording, foreign companies will have to wait to determine what this reform actually entails after its implementation at internship.
[Xulio Ríos. Xi Jinping's China. From bitter decadence to the dreamed modernization. publishing house Popular. Madrid, 2018. 300 p.]
review / María Martín Andrade
Given the globally known growth of China in recent years and the uncertainty caused internationally by its giant steps in a rather short period of time, it is worth examining what sustains the Chinese modernization process in order to determine its solidity. Xulio Ríos, expert in sinology and director of the Observatory of Chinese Politics (jointly dependent on Igadi and Casa Asia), carries out this analysis in Xi Jinping's Chinawith approach covering political, economic and social issues. Rios addresses China's role in globalization and how Xi Jinping's 2012 takeover of power has further accelerated the country's rapid modernization.
Ríos begins by identifying the three keys to China's success in the modernization process: the employment of a sound economic policy, the implementation of its own strategy and a strong identity capable of adapting the major currents of international thought to the country's unique characteristics. This adaptation has been at the heart of China's modernization process, whose challenges in the coming years are to move from a Economics of imitation to a Economics of innovation, to invest in fair policies aimed at correcting the inequalities the country faces, and to carve out a niche for itself in the international system without having to abandon its identity.
The Chinese dream is the main element that characterizes this new path that Xi Jinping intends to follow since he became University Secretary of the CCP; a dream that makes reference letter to the illusion and aspirations of a people that has seen its path towards modernization hindered. Unlike Maoism, where traditional culture was seen as an expression of the old society, Xi stresses the importance of highlighting some of the values of popular culture that can help consolidate the nation's consciousness in this century.
The author does not fail to note that the main obstacles to this rapid Chinese evolution are the high social costs of the latest transformations and the environmental bankruptcy that is causing so much serious damage. For this reason, without ever taking his eyes off the Chinese dream, University Secretary of the CCP and president of the country assures us that he wants a beautiful, environmental, rich and powerful China, with global influence, but without ever abandoning his own profile .
As part of the party's governance reform, Xi Jinping persists, like no other previous president, in the importance of the rule of law as an expression of modernization in the form of government. In tune with this, judicial reform has become one of the main thrusts of his mandate to combat the imbalance in the administration of justice throughout the country. On the economic front, the role attributed to the private Economics in terms of modernization is making China the world's leading Economics . The diversification of its investment in foreign reserves and developments in sectors such as automobiles are proving to be an alternative to the Western model aimed at taking the lead in globalization.
Thus, the four modernizations of Xi's governance focus on industry, agriculture, science and technology, and defense. These advances are intended to be complemented by a remarkable drive to strengthen multipolarity, increasing its presence in foreign markets and seeking global recognition of its update through new objectives, such as the revitalization of the Silk Roads, the creation of economic corridors or the Asian Investment and Infrastructure Bank.
Having broken down the different elements that make up the change in China's image, the author concludes by pointing out that, despite the economic development and the increase in political confidence, the country can become more involved and take on more responsibilities. However, due to its structural circumstances and domestic conflicts, China is not yet sufficiently prepared to replace the US or the West in global leadership. Nevertheless, there is nothing to stop Xi Jinping's distinguished move, compared to other Chinese leaders, to assert interests more conspicuously and visibly, with the Silk Road being a clear example of the ambition of the Chinese process.
[Jim Sciutto, The Shadow War: Inside Russia's and China's Secret Operations to Defeat America. Hasper-Collins. New York, 2019. 308 p.]
review / Álvaro de Lecea
With the end of the Cold War, which pitted the former Soviet Union against the victorious United States of America, the international system shifted from bipolar to a hegemony led by the latter. With the United States in the lead, the West focused on the spread of democracy and commercial globalisation, and if anything the geo-strategic preoccupation of the West was focused on the Al-Qaeda attacks on the Twin Towers on 9/11, so the focus of attention shifted and today's Russia was pushed into the background. However, Russia continued to slowly reconstitute itself in the shadow of its old enemy, which no longer showed much interest. Russia was joined by China, which began to grow by leaps and bounds. At this point, the United States began to realise that it had two major powers on its heels and that it was engaged in a war it did not even know existed: the Shadow War.
This is the term used by Jim Sciutto, CNN's chief national security correspondent, to describe what he describes in detail throughout his book and what has largely come to be known as hybrid or grey zone warfare. Sciutto prefers to speak of Shadow War, which could be translated as war in the shadows, because this better denotes its character of invisibility under the radar of open or conventional warfare.
This new war was started by Russia and China, not as allies, but as powers with a common enemy: the United States. It is a hybrid war subject and therefore contains both military and non-military methods. On the other hand, it does not envisage a direct military confrontation between the two blocs. In The Shadow War: Inside Russia's and China's Secret Operations to Defeat America, Sciutto explains seven situations in which the strategies being pursued by China and Russia to defeat the United States in order to become the world's major powers and impose their own international norms can be clearly observed.
First, it is important to note that Russia and China, while pursuing similar strategies, are different types of adversaries: on the one hand, China is a rising power, while Russia is more of a declining power that is trying to return to its former self. Nevertheless, both share a number of similarities. First, both seek to expand their influence in their own regions. Second, both are suffering from a crisis of legitimacy within their borders. Third, both seek to right the wrongs of history and restore what they perceive as their countries' legitimate positions as world leaders. And finally, they possess great national unity, so that the majority of their populations would do whatever is necessary for their nation.
In the shadow war, thanks to the rules established by Russia and China, any major actor can win, regardless of its power or influence over other international actors. Following the theories of International Office, these rules could be considered to follow a very realistic patron saint , since, in a way, anything goes to win. The power of lies and deception is the order of the day, and lines that were thought unthinkable are crossed. Examples of this, as the book explains and elaborates, are the militarisation of the artificial islands built by China in the South China Sea when Xi Jinping himself had promised not to do so, or the hacking of the Democratic Party's computer system in the 2016 US election campaign by Russian hackers, which may have helped Donald Trump emerge victorious.
To all this must be added an essential part of what is happening in this context of non-traditional warfare: the particularly mistaken idea that the United States has about everything that is happening. To begin with, the first mistake the US made, as Sciutto explains, was to neglect Russia as a relevant focus in the international arena. It believed that, having defeated it in the Cold War, the country would no longer re-emerge as a power, and so failed to see the clear clues that it was slowly growing, led by President Vladimir Putin. Similarly, it failed to understand the Chinese government's true intentions in situations such as the South China Sea or the degree program submarines. All of this can be summed up as the US believing that all international actors would play by the rules established by Washington after the Cold War, without imagining that they would create a new scenario. In conclusion, the US did not understand its opponents.
In his latest chapter, Sciutto makes it clear that the US is currently losing the war. Its biggest mistake was not realising status until it was in front of it and it now finds itself playing on a disadvantaged stage. It is true that the US remains the world leader in many respects, but Russia and China are overtaking it in others, following the new rules they themselves have set. However, a change of attitude in US policies could turn the tide. The author proposes a number of solutions that could help the US get back in the lead.
The solutions he proposes focus, in the first place, on the total knowledge of the enemy and its strategy. This has always been his great disadvantage and would be the first step to begin to control status. Similarly, it recommends greater unity within the Allied bloc, as well as an improvement of its own defences. He also recommends a better understanding of the new scenario in which the whole conflict is taking place, and therefore a series of international treaties regulating these new spaces, such as cyberspace, would be of great help financial aid. Further on, he proposes setting clear limits on enemy actions, raising the costs and consequences of such actions. Finally, it encourages the US to exercise clear leadership.
In conclusion, Sciutto's thesis is that the United States finds itself fighting a war whose existence it has only just discovered. It is a subject war that it is not used to and with a set of rules that are alien to what it preaches. While it is still the leader of the current international system, it finds itself losing the game because China and Russia have been able to discover its rival's weaknesses and use them to its advantage. America's biggest mistake was to ignore all the signs of this shadow war and do nothing about it. New scenarios have been introduced and the rules of the game have been changed, so the US, if it wants to turn status around and once again emerge as the victor, the author argues, will have to unite more than ever internally as a nation and strengthen its alliances, and know its enemies and their intentions better than ever before.
In terms of a evaluation of the book, it can be said that it succeeds in concisely and clearly conveying the most relevant points of this new contest. It manages to make clear the strengths and weaknesses of each actor and to take stock of the current status . However, the author does not manage to be too goal judgemental. While admitting the failings of the US, he gives a negative picture of its rivals, taking for granted who are the good guys and who are the bad guys. Objectivity is lacking in some cases, as the good guys are not always so good and the bad guys are not always so bad. That said, Sciutto provides a great analysis of the current international status in which the world's major powers find themselves.
[Bruno Maçães, Belt and Road. A Chinese World Order. Penguin. Gurgaon (India), 2019. 227p.]
review / Emili J. Blasco
Covered at the moment by literature devoted to present the novelty of the Chinese New Silk Road project , Bruno Maçães leaves aside many of the specific concretions of the Chinese initiative to deal with its more geopolitical aspects. That is why Maçães uses the name Belt and Road throughout the book, instead of its acronyms -OBOR (One Belt, One Road) or the more recently used BRI (Belt and Road Initiative)-, since he is not referring so much to the layout of the transport connections themselves as to the new world order that Beijing wants to shape.
Through this economic integration, according to Maçães, China could project power over two thirds of the world, including Central and Eastern Europe, in a process of geographic cohesion of Eurasia to which this Portuguese politician and researcher already dedicated his previous work.
Compared to other essays on the New Silk Road, this one focuses a lot on India (this is the case in its general content, but also in this review a special edition dedicated to that country has been used, with a particular introduction).
Maçães grants India the role of core topic of vault in the project integrating Eurasia. If India decides not to participate at all and, instead, to go for the alternative promoted by the United States, together with Japan and Australia, then the Chinese design will not reach the dimension longed for by Beijing. "If India decides that life in the Western order will be better than under alternative arrangements, the Belt and Road will have difficulty achieving its original ambition," says the author.
Maçães believes, however, that the West is not all that attractive to the subcontinent. In that Western order, India can only aspire to a secondary role, while the rise of China "offers it the exciting possibility of a genuinely multipolar, rather than merely multilateral, world in which India can legitimately hope to become an autonomous center of geopolitical power," at least on a par with a declining Russia.
Despite these apparent advantages, India will not go all the way to either side, Maçães predicts. "It will never join the Belt and Road because it could only consent to join China in a project that was new. And it will never join a US initiative to rival the Belt and Road unless the US makes it less confrontational." So, "India will keep everyone waiting, but it will never make a decision on the Belt and Road".
Without Delhi's involvement, or even more, with resistance from the Indian leadership, neither the US nor China's vision can be fully realized internship, Maçães continues to argue. Without India, Washington may be able to preserve its current model of alliances in Asia, but its ability to compete on the scale that the Belt and Road does would collapse; for its part, Beijing is realizing that alone it cannot provide the financial resources needed for the ambitious project.
Maçães warns that China has "ignored and disdained" India's positions and interests, which may end up being "a major miscalculation". He believes that China's impatience to start building infrastructure, because of the need to demonstrate that its initiative is a success, "may become the worst enemy".
He ventures that the Chinese may correct the shot. "It is likely - perhaps even inevitable - that the Belt and Road will grow increasingly decentralized, less China-centric," he says, commenting that in the end such a new Chinese order would not be so different from the structure of the existing Washington-led world order, where "the US insists on being recognized as the state at the apex of the hierarchy of international power" and leaves some autonomy to each regional power.
If Maçães puts India in a status of non-alignment plenary session of the Executive Council, he does foresee an unequivocal partnership of that country with Japan. In his view it is a "symbiotic" relationship, in which India sees Japan as its first source of technology, while Japan sees the Indian navy as "an indispensable partner in its efforts to contain Chinese expansion and safeguard freedom of navigation" in the seas of the region.
As for Europe, Maçães sees it in the difficult position "of not being able to oppose an international project of economic integration, while being equally incapable of joining as a mere participant" in the Chinese initiative, in addition to the germ of division that project has already introduced into the European Union.
From Bangladesh to Pakistan and Djibouti
Despite the differences indicated above, Maçães believes that the relationship between China and India can develop positively, even if there is some element of latent conflict, encouraged by a certain mutual distrust. The commercial linkage of two such immense markets and production centers will generate economic ties "called to dominate" the world Economics towards the middle of this century.
This movement of goods between the two countries will make Bangladesh and Myanmar the center of a major trade corridor.
For its part, Pakistan, in addition to being a corridor for the exit to the Indian Ocean from western China, will be increasingly integrated into the Chinese production chain. In particular, it can supply raw materials and basic manufactures to the textile industry that China is developing in Xinjiang, its export gateway to Europe for goods that can optimize rail transport. The capital of that province, Urumqi, will become the fashion capital of Central Asia in the next decade, according to Maçães' forecast, agreement .
Another interesting observation is that the shrinking of Eurasia and the development of internal transport routes between the two ends of the supercontinent, may cause the container ports of the North Sea (Amsterdam, Rotterdam, Hamburg) to lose weight in the trade between Europe and China at the expense of a greater transit of those of the Mediterranean (Piraeus, especially).
The author also ventures that Chinese infrastructure works in Cameroon and Nigeria can help facilitate connections between these countries and Doralé, the port that China manages in Djibouti, which, through these trans-African routes, could become "a serious rival" to the Suez Canal.
If in Djibouti China has its first, and for the moment only, military base outside its territory, it should be kept in mind that Beijing can give a possible military use to other ports whose management has assumed. As Maçães reminds, China approved in 2016 a legal framework that obliges civilian companies to support military logistics operations requested by the Chinese Navy.
All these are aspects of a suggestive book that does not allow itself to be carried away by the determinism of the Chinese rise, nor by an antagonistic vision that denies the possibility of a new world order. The work of a European who, although he served in the Portuguese Foreign Ministry as director general for Europe, is realistic about the weight of the EU in the orb's design .
The risk of military use of the facility, fuelled by confidentiality clauses, fuels discussion in Argentina and suspicion in Washington.
China's arrival on the far side of the moon has put the spotlight on Chinese space developments. For this new degree program, Beijing has a tracking and observation station in Patagonia, the first on its own territory. In Argentina, there has been an extensive discussion about possible unacknowledged purposes of these facilities and alleged secret clauses negotiated at the time by the Kirchner administration. The government of Mauricio Macri guarantees the peaceful uses of the station, but the controversy has not ceased.
Chinese space station in the Argentinean province of Neuquén [Casa Rosada] ▲ Chinese space station in the Argentinean province of Neuquén [Casa Rosada].
article / Naomi Moreno Cosgrove
After years of gradual economic penetration, which has led it to become the leading commercial partner in several South American countries and a major lender and investor throughout the region, China's incursion into Latin America is no longer silent. The influence it has achieved in various nations - for example, it acquires almost 90% of Ecuador's oil exports and its credits have been essential for the subsistence of Venezuela and certain Brazilian public companies - means that China's activities are attracting special attention and its expansion is becoming increasingly clear.
China's growing power in Latin America is especially noted by the United States, although its own neglect of the region, sometimes presented as a consequence of its pivot towards Asia, has contributed to national governments' attempts to meet its needs by seeking other partners from reference letter.
Already suspicious of China's growing presence in the Americas, any activity in strategic fields such as security arouses particular suspicion in Washington. This has also been the case with moves made by Moscow, such as the siting of a station for the Russian Global Navigation Satellite System (Globalnaya Navigatsionnaya Sputnikovaya Sistema or GLONASS) in Managua (Nicaragua). The secrecy surrounding the operation of the facility has caused mistrust among the population itself, raising suspicions as to whether its use is intended solely to provide a higher quality of the Russian navigation system or whether there is the possibility of strategic exploitation by Russian aerospace defence forces.
Suspicions about the so-called Far Space Station, the Chinese National Space Administration (CNSA) station in Patagonia, in the province of Neuquén, stem from entrance from the fact that it was negotiated at a time of particular disadvantage for Argentina, due to the financial weakness of Cristina Fernández de Kirchner's government and its need for urgent credit. When Argentina was out of the international credit markets for having defaulted on nearly 100 billion dollars in bonds, the Asian country was a blessing for the then president.
In 2009, in the midst of the financial crisis, China sent representatives to Latin America to discuss an issue that had little to do with currency fluctuations: Beijing's space interests. This was due to China's desire to have a centre in the other hemisphere of the globe that could support its space activity, such as the expedition to the far side of the moon.
After months of negotiation under great secrecy, the Chinese government and the government of the province of Neuquén signed a agreement in November 2012, giving China the right to use the land - rent-free - for fifty years. The technical agreement was signed by the Chinese state-owned business Launching Security and Control Satellite (CLTC) and the Argentinean National Commission for Space Activities (CONAE).
Enormous in size, the larger of the two circular antennas - it is twelve stories high, weighs 450 tons and has a large diameter - and visible from a great distance due to its location in the middle of a desert plain, the station soon became an ideal target for controversy and suspicion. Fears that, in addition to its declared civilian use, it might also have a military purpose and be used to gather information by intercepting communications in that part of South America, fuelled the controversy.
After becoming Argentine president in 2015, Mauricio Macri entrusted the then foreign minister Susana Malcorra and the Argentine ambassador in Beijing, Diego Guelar, with the task of negotiating that agreement should include the specification that the station would only be used for peaceful purposes, which the Chinese accepted.
In spite of everything, the discussion about the risks and benefits of the Chinese base is still alive in Argentine public opinion. Politicians from civil service examination in Neuquén consider that "it is shameful to renounce sovereignty in your own country", as Congresswoman Betty Kreitman said when provincial legislators heard about project.
Beyond Argentina's borders, White House officials have called project a 'Trojan Horse', reflecting US concerns about the initiative, according to sources quoted by The New York Times. Even apart from any strategic dispute with the United States, some Latin American leaders have doubts and regrets about established ties with China, worrying that previous governments have subjected their countries to excessive dependence on the Asian power.
The main questioning of the Chinese base, then, has to do with its possible military use and the possible existence of secret clauses. The latter have been the main cause of international suspicion, as Macri himself came to validate the existence of these clauses when they became a weapon against the Kirchner government, and promised to reveal them when he became president, something he has not done. However, the Argentine space authorities themselves deny any section secrecy.
Perhaps the misunderstanding can be found in the fact that the contract signed between the Chinese CLTC and the Argentinean CONAE states that "both parties will maintain confidentiality regarding the technology, activities and monitoring, control and acquisition programmes of data". Although confidentiality regarding third parties in relation to technology is a common internship , in this case it contributes to public mistrust.
Given that the CLTC reports to the Chinese People's Army, it is difficult to deny that the data it obtains will come under the domain of the Defence hierarchy and may end up being put to military use, although not necessarily for military purposes. Experts also say that antennas and other equipment used to support space missions, similar to those the Chinese have in Patagonia, are likely to increase China's intelligence-gathering capabilities. "A giant antenna is like a huge hoover. It sucks up signals, information, all subject of things," Dean Cheng, an expert on China's national security policy, was quoted as saying in the NYT.
Opportunities and challenges in Sino-Panamanian relations, one year after the establishment of diplomatic relations
In June 2016, Panama inaugurated the expansion of its Canal. In June 2017, the Panamanian government decided to establish diplomatic relations with China (Central America has been a traditional ally of Taiwan), thus giving rise to the flow of new Chinese investments in a Canal revitalized with the expansion. On the one-year anniversary of the establishment of relations, here is a review of the opportunities and challenges posed by the increased Chinese presence in the isthmus.
▲Container ship of the Chinese shipping company COSCO, making transit issue 2,000 in the expanded Canal, in September 2017 [Panama Canal].
article / Ximena Barria
In the last decade, the People's Republic of China has made efforts to increase its presence in different regions of the world. China's projection as a global power has meant that no region is alien to it and there are hardly any countries that do not actively seek commercial exchange with the Asian giant. Therefore, it is not surprising that China has wanted to increase its activity around the Panama Canal, and that this Central American country has established diplomatic relations with Beijing, breaking the traditional relationship with Taiwan.
Panama's privileged geography and its rapid economic growth in the region are two important aspects taken into account by China. The Panama Canal offers advantageous access to the Atlantic and Pacific oceans and about 6% of global maritime trade passes through it. At times there has been talk of Chinese interest in building a canal in Nicaragua, something that was never really on Beijing's diary . China sees Panama as an important geostrategic point from which to project its foreign policy in Latin America, which undoubtedly unsettles Washington.
On June 13, 2017, the Republic of Panama and the People's Republic of China announced the establishment of diplomatic relations. With this, Panama recognized the government of Beijing as the legitimate Chinese government and broke the previous diplomatic relations established with Taipei. The new Sino-Panamanian relations gave way to 19 agreements in various areas.
Chinese projects in the isthmus
In a country as open to trade and transactions of all subject as Panama is, the population of Chinese origin has always had a relative presence. The Chinese community in Panama is made up of some 135,000 people, which represents 4% of its 4 million inhabitants.
Since 1911, Panama had maintained diplomatic relations with China. However, after the defeat of the Chinese Nationalist Party and the victory of Mao Zedong's communism, the Panamanian State decided to maintain diplomatic relations with Taiwan, due to its capitalist stance, during the Cold War. Since 1949, Panama remained one of Taiwan's major allies until its rupture in 2017.
Despite the recognition of Taipei, trade relations between Panama and the People's Republic of China have been increasing in recent years, generating a larger volume of exchange than that recorded between the Central American country and Taiwan.
Panama's most important economic engine is the Canal, which links the Atlantic and Pacific oceans and constitutes one of the most important routes for world trade. Canal revenues generate one third of Panama's Gross Domestic Product. Over the years, China has become an important customer of the Canal, becoming its second largest customer Username after the United States. The first ship to cross the expanded Canal, at the inauguration held in June 2016, was a vessel of the Chinese shipping company COSCO, which was awarded the honor by lottery.
China is the largest provider of the Colon Free Zone (CFZ), located on the Caribbean coast of Panama, next to the northern mouth of the Canal. It is the most important free zone in the Americas and the second largest in the world, with an annual volume of imports and re-exports of $16.16 billion. In the first semester of 2017, the FTZ imported $1.344 billion worth of goods from China. Likewise, important Chinese companies have sought to establish themselves in the FTZ taking advantage of the strategic advantages it offers.
China has also announced the construction of a container port at area in Colon, which will have facilities for receiving liquefied natural gas. The planned construction is estimated to cost $900 million. The construction will result in the first container terminal designed to handle Neopanamax ships, which have the maximum dimensions to transit the canal.
In the area of communications, the People's Republic of China expressed its interest in building a railway infrastructure connecting the capital of Panama and the province of Chiriqui, covering a distance of 400 kilometers. As for air transportation, the Air China airline committed to operate the Panama City-Beijing route twice a week. Panama has the most important air hub in Latin America and having a direct flight to Beijing represents an important opportunity to bring Asian markets closer to Latin America.
In addition, Panama has an important and diversified financial center that is attractive to Chinese banks as a strategic gateway to establish themselves in the region. The presence of Bank of China, with more than 30 years in the country, and future establishments of other entities such as Banco Industrial y Comercial, Exim Bank and China Development Bank will contribute to increase the flow of Chinese capital to Panama. This, in turn, will diversify and make Panama's banking sector increasingly dynamic.
The Panamanian challenge to take advantage of the opportunity
Ensuring that this increased relationship with China and the Asian market structurally benefits Panama and does not degenerate into a future status of dependence presents important challenges for a country that is in the process of development. Panama will have to increase productivity in sectors such as agriculture and industry, train more staff and create a transparent framework of financial institutions.
The agricultural sector presents marketing difficulties and a lack of agricultural policies to produce and sell crops at fair prices. In recent years, there has been a shortage of land for crop marketing purposes as a result of droughts and floods. Another challenge is food imports, since many imported foreign products are cheaper and this causes a drop in the prices of domestic products, which makes their production unprofitable for the farmer.
The increase in industrial productivity goes hand in hand with the effort of training of a better human capital. Currently, in the Panamanian republic there is a lack of preparation of people who can manage important companies. In 2015, the issue of enrolled in universities reached only a meager issue of 160,000 students. The Panamanian government should promote technical training projects and scholarships to increase this issue so that in the long term deadline there will be more staff trained for the new companies that will arrive.
The Panamanian financial structure should also be prepared to create new legislation that will contribute to legal certainty. In order to harmonize the financial sector with international anti-money laundering conventions, the Panamanian government should establish tax reforms that promote fiscal transparency. The entry of foreign banks should be regulated more effectively. The discussion to consider classifying tax evasion as a tax crime will present an important challenge for the country to consider.
Kenya has the first section of the new railway network financed with financial aid from Beijing.
Africa's participation in the New Silk Road promoted by China involves connecting the hinterland of several East African countries with the main ports on their Indian coast. The designed railway network , which introduces standard gauge in the region, has begun to operate between the two main cities of Kenya: Nairobi and the port of Mombasa. But the full realisation of the project is subject to the questionable model of Chinese investment.
▲Freight transport between Nairobi and Mombasa [Kenya Railways] ▲Freight transport between Nairobi and Mombasa [Kenya Railways].
article / Claudia Correa and Alexia Cosmello
Sino-African relations date back to the 15th century when Zhang, the navigator and trader, arrived on the shores of Mozambique. However, it was with Mao Zedong in 1949 that real relations were established. With promises of respect and taking into account the wounds left by colonisation, China has economically assisted Africa to become its main economic partner since 2009. Through the implementation of economic and technological cooperation projects, it has financed the construction of hydroelectric power plants, dams, airports, aqueducts, hospitals, refineries, gas pipelines, railways and highways in 52 of Africa's 54 countries.
Cooperation between China and Africa has grown considerably. Since 2000, ministerial conferences of the Forum on China-Africa Cooperation (FOCAC) have been held, increasing trade and partnership in areas such as Education, science, technology and health. On the other hand, in terms of lending and investment, China has announced that it will allocate a large part of its capital to projects on the African continent. In 2013, for example, Chinese President Xi Jinping pledged €14.4 billion for infrastructure built by Chinese companies, while in 2014 Premier Li Keqiang announced that China would allocate an additional €8.6 billion to development projects in Africa.
China's rise and intention to broaden and deepen its influence in the world has been very clear in recent years. In September 2013, Xi Jinping presented a new public works expansion project called the New Silk Road. With the goal to gain a foothold in world trade, China aims to improve Asia's connections with other regions by building land routes and articulating a sea route to facilitate trade. Although it is an initiative that will be useful for the international community, it is important to stress the benefits for Africa, since the East African transport route network will be built on its territory, which will give that part of the African continent greater access to world trade, as well as new infrastructure with cutting-edge technology.
Standard Gauge Railway
The network East African freight and passenger goal is intended to connect Kenya's major cities with Uganda's capital Kampala, Burundi's capital Bujumbura, South Sudan's capital Juba and Rwanda's capital Kigali. It is planned to apply standard gauge to most of the route, so the project is known as Standard Gauge Railway (SGR). It is estimated that the network railway will be around 2,935 kilometres in total and will cost around $13.8 billion. position The majority of the financing will be provided by the Chinese government, with financial aid and EiximBank, which will finance 90% of the construction costs, while the Kenyan government will finance the remaining 10% only. The work will be carried out by the Chinese business Road & Bridge Corporation, which is considered to be the most entrepreneurial public business presence in Africa.
The first phase of project, called the Madaraka Express, is now complete and was inaugurated in May 2017. The initiative involved the construction of a railway line to link Nairobi, the capital of Kenya, with Mombasa, the most important port city in Kenya and East Africa. The train can carry 1,260 passengers over a distance of approximately 470 km. With one of the key parts of the network transport network already built, it is possible to continue with the project and move on to the second phase, which will consist of extending the railway lines to the rest of the cities mentioned above.
project of the new railway network [Kenya Railways].
China's Investment Challenges
What are China's purposes for investing in Africa? It probably does so because it is a large potential market for the sale of its products, as well as a large source source of natural resources. In East Africa, for example, there is oil in Kenya or materials essential for mobile phone batteries in Malawi. In any case, it is clear that this is not a charitable act on the part of the Chinese, as it has been shown that Chinese banks and companies offer financing because it allows them to secure a larger market share in Africa as part of their strategy to go global.
According to Chinese Premier Li Keqiang, "cooperation with Africa is based on respect, equality and mutual benefit". African representatives are enthusiastic about China's investment in Africa's development . The Kenyan president declared that the new train will "revolutionise the region's Economics and reaffirm Kenya's status as an economic hub", and Malawi's ambassador Wang Shiting expressed his thoughts on Africa's development , posting that Africa will only improve when everyone contributes to its development, and that is precisely what China is currently doing.
According to agreement with these official views, from the African point of view, China's intervention on the continent is not seen as negative. However, it does present certain problems, such as the suspicion and accusation of corruption by Chinese investors or the claim that it is aggravatingly widening the economic gap between the more and less well-off, as Chinese investors understandably expect to do business with the continent's elites. There is also the mistreatment of the environment, such as the controversy over the environmental impact of the aforementioned network railway, especially in Kenya, where people have questioned the route through Nairobi Park because of the environmental impact.
It is not only Chinese companies that are investing on the African continent; some Western and European companies have, in some cases, replaced Chinese companies. A prime example is the US multinational General Electric, which in just one year has tripled its workforce in Nigeria, Kenya and Ethiopia. This is possible as a result of the delays or paralysis that some projects have suffered due to the sudden drop in raw material prices and the Chinese slowdown. Thanks to this, some African states with sufficient financial structure have taken the initiative themselves not to let the projects be buried.
▲Flags in a welcome ceremony given to the US vice president in Tokyo, in February 2018 [White House].
COMMENTARY / Gabriel de Lange [English version].
Over the last few decades China has grown in economic and political strength. One of the most recent developments was the inclusion of the document Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era in the Communist Party of China's (CPC) Constitution, which took place during the 19th Congress held in Beijing in October 2017. Later on, in March 2018, the National People's Congress approved to remove from the country's Constitution the limit of two presidential terms. These steps have consolidated the power of the current Chinese leader.
The United States of America on the other hand has been criticized on multiple fronts for its dealings in Asia. Some authors say that Trump's approaches to North Korea, China, and other Asian countries "are damaging US interests" in the Asia-Pacific region, specifically in his rash handling of the threat of North Korea. In terms of economics, withdrawing the US from the TPP (Trans-Pacific Partnership) "has undermined America's influence" in shaping the Asia-Pacific's future and "given China an enormous opportunity to shape that future on its own terms." The withdrawal has made many Asian countries concerned with what the United States brings to the table in terms of economic engagement, and this may encourage them to look to China to fill this void.
One of the main factors that keep Asian countries' foreign policy at a distance from China and closer to the US is due to trouble in the South China Sea, such as in the case of the Philippines with the Spratly Islands or Vietnam with the Parcel Islands. Many have noted these countries' concerns about Chinese intentions "have pushed them closer to the United States." Unfortunately for the US, this dependency is more reliant on China's own decision whether or not to insist their claims to particular islands. This is subject to change if the Xi administration decides that the benefits of stronger relations with their neighbors are more important than these disputed territories.
The question now is, who will the other Asian countries, especially those members of ASEAN (Association of South East Asian Nations) look to rely on as a political ally? With signs of firm, stable, and lasting Chinese power under the authority of Xi Jinping, compared to a seemingly unpredictable, divided, and internationally criticized Trump administration, one may not be surprised to see Asian foreign policies leaning more towards China in the near future.